unit1

BCA V
 MIS:-Management Information System
• Management:-Management covers the planning, control, and
administration of the operations of a concern. The top
management handles planning; the middle management
concentrates on controlling; and the lower management is
concerned with actual administration.
• Information:-Information, in MIS, means the processed data that
helps the management in planning, controlling and operations.
Data means all the facts arising out of the operations of the
concern. Data is processed i.e. recorded, summarized, compared
and finally presented to the management in the form of MIS
report.
• System:-Data is processed into information with the help of a
system. A system is made up of inputs, processing, output and
feedback or control
 Management Information System
• 'MIS' is a planned system of collecting, storing, and disseminating data in the
form of information needed to carry out the functions of management.
• The MIS has been understood and described in a number of ways. It is also
referred to as:
a) Information system
b) Information and decision system
c) Computer based information system
• MIS can be defined in a number of ways:
1. The MIS is defined as a system which provides information support for
decision making in the organization.
2. MIS is an integrated system of men and machines for providing the
information to support the operations, the management and decision making
functions in the organization.
3. MIS is defined as a system based on the database to the Organization evolved
for the purpose of providing information to the people in the Organization
 Basic Objectives
• Capturing Data − Capturing contextual data, or operational information that will
contribute in decision making from various internal and external sources of
organization.
• Processing Data − The captured data is processed into information needed for
planning, organizing, coordinating, directing and controlling functionalities at
strategic, tactical and operational level. Processing data means:
a) making calculations with the data
b) sorting data
c) classifying data and summarizing data
• Information Storage − Information or processed data need to be stored for
future use.
• Information Retrieval − The system should be able to retrieve this information
from the storage as and when required by various users.
• Information Propagation − Information or the finished product of the MIS should
be circulated to its users periodically using the organizational network.
 Characteristics of Computerized MIS
• It should be able to process data accurately and with high speed,
using various techniques like operations research, simulation,
heuristics, etc.
• It should be able to collect, organize, manipulate, and update large
amount of raw data of both related and unrelated nature, coming from
various internal and external sources at different periods of time.
• It should provide real time information on ongoing events without any
delay.
• It should support various output formats and follow latest rules and
regulations in practice.
• It should provide organized and relevant information for all levels of
management: strategic, operational, and tactical.
• It should aim at extreme flexibility in data storage and retrieval.
 Components of MIS
1. Executives :The people who utilize MIS. These people are computer professionals who operate
MIS for data processing to achieve organizational goals like planning and decision-making.
2. Hardware :Components of MIS include various input and output devices that helps in feeding
data as well as displaying the information when required. The input devices include the keyboard,
scanners and mouse. The output devices may be the monitor, printer, network devices, and so on.
3. Software :Computer programs which are designed to do a specific task for example, MS Office,
Banking Software’s, Railway’s applications etc., different kinds of software available to process
the data/information in an organization such as ERP (enterprise resource planning) and CRM
(customer relationship management).
4. Organizational Procedures :Procedures are sets of rules or guidelines that an organization
establishes for the use of a computer-based information system. The procedures may vary from
one organization to another. It may also vary from one department to another as per the
requirement.

For example, the working of production department is different from the working of sales
department. The production department requires information regarding the raw material or
quantity of goods to be produced. So, the production department sets its procedures in such a way
that the MIS system helps in retrieving the information required by the department. In the similar
way, the sales department requires information regarding the quantity of goods sold and the other
expenses that occurred during the sales of the product. Therefore, the sales department sets the
procedures in such a way that they get only that information which is required from the MIS.
 Functions of MIS
The main goal to set up an MIS in a company is to utilize the information by its managers for
managerial purpose for decision making.
MIS performs following functions to achieve organizational goal:
1.To collect useful data: MIS executes the data through computer system using the sources of an
organization. The organizational data is stores in computer system or as a paper record by its end
users.
2.Data Processing: Processing data includes converting the storage data into the required
information to take beneficial actions. Data processing includes mathematical and logical operations
like, calculations, sorting, classifying and summarizing the data. The data processing signifies
processing activities as:
• Organize data
• Analysis on data
• Apply statistical, mathematical, operations
• To create predictive modeling
• Research and forecasting
3.Information storage and retrieval: MIS stores data as an organizational record and processed for
future use. The data organizes as a fields, records, files and databases for future use. Information
retrieval comprises to access the stored data as per the requirements of the management users.

4.Disseminating management information: information of finished product is categorizes and

dispersed to the users in an organization as per the needs. This information could be periodic, through
reports or online through computer terminals. Figure shows various functions performed by MIS.
Information
Processing
 Framework of MIS
• Robert Anthony from the University of
Chicago;
• In 1965,He proposed a framework for
the MIS system which mainly consists
of three components.
• These components are Strategic
Planning, Operational Control, and
Management Control.
• Strategic Planning
• Strategic planning is a method of focusing on improvements in the
goals of the organization, the methods that are to be used to achieve
these objectives; policies that are frame by management experts to
control, organize, and use organizational resources to reduce the cost
and maximize profit. Overall, strategic planning helps in designing
the strategies of the company, and is used in formulating policies to
control the acquisition, handling of the business activities, and gets
involved in reframe strategy whenever required. From a philosophical
perspective, strategic planning must be design in such a way so that
an organization may achieve its aim and objectives as well as can
keep itself up to date on new developments through changes to the
objectives, the financial aspects of the resources needed, and the
guiding principles and policies to be followed in obtaining, using the
organizational resources.
 Operational Control

• Operational control is a process of managing operational activities

of an organization that are carried out to achieve optimal
utilization of the resources and successful implementation of the
operational activities in an organization like production,
production, stock management, financial process, HRM, etc. To
run it smoothly, matrices allow for pre-established processes and
decision rules to be used, the constant assurance of effective
acquisition and use of resources in the areas in which the results
can be reasonably well understood, and operations are optimally
organized and managed. For an instance – the directives set by
our superiors are followed as per our ability and that the tasks we
perform effectively and efficiently. These decisions at lower levels
of the company have very little effect on the organization. There is
a fixed timeline for decisions being taken, and there are certain
"routines" that immediately proceed to complete the process.
 Management Control
• Management control is a process of assuring that resources
are collected and used effectively and efficiently, resulting in
the accomplishment of the organizational key objectives. In
this process, an executive or superiors, or managers will use
to assess the productivity of his/her department, identify the
issues, formulate some new and innovative strategies, make
some rules of control, set protocol, and evaluate the risk
allocation of resources. This job is mainly taking care of the
middle-level management of the company. At this level,
managers must be taking advice from the strategic planning
hierarchy and must be monitoring the organization's
activities so that the strategic priorities can be set and
accomplished efficiently and successfully.
 Relationship between Operations, Planning and
Control
• The details given by an MIS helps the managers to make decisions that are not
involved. An organization must conduct certain activities to prevent itself from
running into serious causes. For example “in a production of any product, a
common process has to perform certain production activities" like a wholesaler
has to obtain and dispatch goods, a municipal corporation has to provide water
supply to its area of jurisdiction. In addition to its day-to-day activities, a company
must also prepare for its potential closing operations. To predict trends, the
company has to make a prompt decision about how much production of a
particular product needs to make for the upcoming time.
• In an organization, the planning process and goals set out at the time of the
planning process decides the scope of the organization’s operations. During the
production process, it has to know whether a decision has to be taken to make
corrections or revise on pre plans based on the tests. Interestingly, all that the
wholesaler would do is correct the deviation or update the plans. It might be
important to control organizational activities with effects to ensure companies'
existence in the market. The following figure is illustrating the same -
MIS is one that is concerned with planning and control. When running, we can
benefit from having several systems for obtaining information. For example, the
carmaker would have sensors installed in the car, programming a system on the
shop floor for giving the workers their information about the task that is required
on a specific batch of material. Along with the rate materials being pushed along
route sheets, other materials are moving at different rates at any given moment.
This system by itself contains only the necessary information to support
operations. It does not have any high-level decision-making meaning. It is not part
of his/her medical record. If, however, the system does include information on
efficiency, computer utilization, or rejection rates (anything which is relevant to
business or productivity), then we can conclude that the system is a part of an
MIS.
The levels of management

• Organizations have several levels, each of which offers a

different context.
• This could be categorized into several categories; multiple-
categories of the levels (Senior, middle and lower).
• This organization is ruled by the top management, and they conduct
strategic planning and the two lower levels provide processing of the
information for their work. The middle management level is responsible
for preparing the tactical management strategies and controls and needs
to get information to execute the level. The junior level of the company
is involved in day-to-day operational management, and they need
knowledge for their working to be effective.
• Decisions are being taken at all levels of the business.
• Now and then, making an extraordinary and rare decision will change
everyone's future.
• Change IT offers new tools for managers to carry out business decisions.
• Receive the most concrete, up-to-date information and relay it as quickly
as possible to those who need to be aware of it.
• It does not provide some information explicitly but offers some
capabilities to the user to evaluate the decision-making problem and
produce some significant information, which can be used as a data
sample of the decision problem.
 Information Needs for the Different Levels of Management

Levels of Problems handled/ decisions made Type of information required

Management

Top level Unstructured problems. Strategic information from within the

organization and outside.
Middle level Decisions are based on situations
not/rarely handled in the past. Information about likely scenarios.
Decision-making variable not clearly Information that can be analyzed in
defined. different ways.
Semi structured/structured problems. Exception reports
Decisions on regular issues. Regular summarized reports.
Decisions on tactical issues. Information that can be drilled deeper for
insight.

Operational Structured problems Information to help find out exceptions so

level Structured decision-making that they can be reported to top
Decision-making on the basis of set management
rules Operational information
Rule based information, guidelines,
handbook level information
 Structured Decisions

• structureddecisions are characterized by well-

defined parameters, clear objectives, and
established criteria for evaluation. These
decisions typically follow a predetermined
process or algorithm, allowing for systematic
analysis and straightforward problem-solving.
Structured decisions are common in routine
tasks and situations where outcomes are
predictable and data is readily available.
 Key Features of Structured Decisions
1.Defined Parameters: Structured decisions operate within
predetermined boundaries, with specific guidelines and
criteria governing the decision-making process.
2.Clear Objectives: Structured decisions are guided by clear
objectives or goals, enabling decision-makers to focus their
efforts on achieving desired outcomes.
3.Systematic Approach: Structured decisions follow a systematic
approach or algorithm, often involving step-by-step
procedures for gathering information, analyzing data, and
reaching a conclusion.
4.Repetitive Nature: Structured decisions are often repetitive in
nature, as they are applied to similar situations or scenarios
with consistent parameters and criteria.
 Unstructured Decisions

• Unstructured decisions are choices made in

situations where there is no clear, predefined
process or standard operating procedure.
These decisions often involve complex,
ambiguous scenarios that require intuition,
creativity, and judgment to navigate effectively.
• Unstructured decisions are usually unique to
a specific context and lack established
guidelines, making them more challenging
compared to structured decisions.
5 Must Know Facts For Your Next Test
1.Unstructured decisions often occur in dynamic environments
where variables are constantly changing and new information
emerges.
2.These types of decisions are typically made by individuals or
groups at higher levels of management who are responsible
for strategic planning.
3.Unstructured decisions can lead to innovative solutions since
they encourage out-of-the-box thinking and creativity.
4.In contrast to structured decisions, unstructured decisions
often involve a greater degree of uncertainty and risk,
requiring careful consideration of potential consequences.
5.Unstructured decisions may rely heavily on qualitative data
and subjective assessments rather than quantitative analysis
or metrics.
 Simon’s Model of Decision-Making

• Herbert Simon made key contributions to enhance our

understanding of the decision-making process. In fact, he
pioneered the field of decision support systems. According to
(Simon 1960) and his later work with (Newell 1972), decision-
making is a process with distinct stages. He suggested for the
first time the decision-making model of human beings. His
model of decision-making has three stages:
•• Intelligence which deals with the problem identification and
the data collection on the problem.
• Design which deals with the generation of alternative
solutions to the problem at hand.
• Choice which is selecting the ‘best’ solution from amongst the
alternative solutions using some criterion.
 Intelligence Phase
• This is the first step towards the decision-making process. In this step the decision-maker
identifies/detects the problem or opportunity. A problem in the managerial context is detecting
anything that is not according to the plan, rule or standard. An example of problem is the
detection of sudden very high attrition for the present month by a HR manager among workers.
Opportunity seeking on the other hand is the identification of a promising circumstance that
might lead to better results. An example of identification of opportunity is-a marketing manager
gets to know that two of his competitors will shut down operations (demand being constant) for
some reason in the next three months, this means that he will be able to sell more in the market.
• Thus, we see that either in the case of a problem or for the purpose of opportunity seeking the
decision-making process is initiated and the first stage is the clear understanding of the stimulus
that triggers this process. So if a problem/opportunity triggers this process then the first stage
deals with the complete understanding of the problem/opportunity. Intelligence phase of
decision-making process involves:
Problem Searching: For searching the problem, the reality or actual is compared to some
standards. Differences are measured & the differences are evaluated to determine whether
there is any problem or not.
Problem Formulation: When the problem is identified, there is always a risk of solving the
wrong problem. In problem formulation, establishing relations with some problem solved earlier
or an analogy proves quite useful.
 Design Phase
• Design is the process of designing solution outlines for the
problem. Alternative solutions are designed to solve the
same problem. Each alternative solution is evaluated after
gathering data about the solution. The evaluation is done on
the basic of criteria to identify the positive and negative
aspects of each solution. Quantitative tools and models are
used to arrive at these solutions. At this stage the solutions
are only outlines of actual solutions and are meant for
analysis of their suitability alone. A lot of creativity and
innovation is required to design solutions.
 Choice Phase

• It is the stage in which the possible solutions are

compared against one another to find out the most
suitable solution. The ‘best’ solution may be
identified using quantitative tools like decision tree
analysis or qualitative tools like the six thinking hats
technique, force field analysis, etc.
 Bounded Rationality Model (Simon)of Decision
Making
• Bounded rationality is a term first coined by Herbert Simon.
Simon challenged the concept of a rational man in classical
and neoclassical economic theories and argued that the
rationality of man is bounded by certain limitations. He
opined that even though rational thinking, deductive
reasoning and logic are good for solving theoretical problems.
• They are not so good for practical problem solving where the
behavior of the decision-maker and his intellect, information
about the problem at hand and the time to solve such a
problem may create a scenario where the decision-making
may happen under a rationality that is bounded by certain
conditions. He argued that in real situations people take
decisions on the basis of heuristics rather than rule based
optimization methods. He argued that decision-making is
bounded by the following limitations.
•
• Lack of information or incomplete information leads to sub optimal
decisions as the decision-maker is not fully aware of the pros and cons
of a decision due to lack of information. Hence, lack of information
creates a boundary and hinders the rational choice of the decision-
maker.
• Intellectual Ability/Cognitive Ability
• The problem at hand may be so complex that the decision-maker may
not be able to comprehend the true nature and complexity of the
problem, leading to a sub optimal decision. If the problem would have
been comprehensible, the decision-maker would have made a rational
choice. This creates a boundary on the otherwise rational choice of the
decision-maker.
• Lack of Time to take Decisions
• The lack of time may also lead to
suboptimal decisions as in this case
the decision-maker does not have time to evaluate all the choices and
come to a rational choice. On the contrary, lack of time leads to
• Formal System:
• Formal system is a system that is designed and developed
using a set of well-established organizational policies,
procedures, and principles, guidelines to coordinate and
facilitate communication between different functional units
and the processes they support, and to meet the overall
information needs of the business.
• Informal System:
• Informal Systems is the systems created by ad hoc, informal
work groups to support information needs that cannot be met
by formal systems. These are powerful systems that meet
unique needs and thrive in many organizations.
Types of formal organization structure

• Line Organization
• Line and Staff Organization
• Functional Organization
• Project Management Organization
• Matrix Organization
 key Differences Between Formal and
Informal Organization
• The difference between formal and informal organization can be drawn clearly on the following grounds:
1.Formal Organization is an organization in which job of each member is clearly defined, whose authority,
responsibility and accountability are fixed. Informal Organization is formed within the formal organization
as a network of interpersonal relationship when people interact with each other.
2.Formal organization is created deliberately by top management. Conversely, informal organization is formed
spontaneously by members.
3.Formal organization is aimed at fulfilling organization’s objectives. As opposed to an informal organization is
created to satisfy their social and psychological needs.
4.Formal organization is permanent in nature; it continues for a long time. On the other hand, informal
organization is temporary in nature.
5.The formal organization follows official communication, i.e. the channels of communication are pre-defined.
Unlike informal organization, the communication flows in any direction.
6.In the formal organization, the rules and regulations are supposed to be followed by every member. In
contrast to informal communication, there are norms, values, and beliefs, that work as a control mechanism.
7.In the formal organization, the focus is on the performance of work while in the case of an informal
organization, interpersonal communication is given more emphasis.
8.The size of a formal organization keeps on increasing, whereas the size of the informal organization is small.
9.In a formal organization, all the members are bound by the hierarchical structure, but all the members of an
informal organization are equal.
 INFORMAL
BASIS FOR COMPARISON FORMAL ORGANIZATION
ORGANIZATION
Meaning An organization type in An organization formed
which the job of each within the formal
member is clearly defined, organization as a network of
whose authority, interpersonal relationship,
responsibility and when people interact with
accountability are fixed is each other, is known as
formal organization. informal communication.

Creation Deliberately by top Spontaneously by members.

management.
Purpose To fulfill, the ultimate To satisfy their social and
objective of the organization. psychological needs.
Nature Stable, it continues for a long Not stable
time.
Communication Official communication Grapevine
Control mechanism Rules and Regulations Norms, values and beliefs
Focus on Work performance Interpersonal relationship
Authority Members are bound by All members are equal.
hierarchical structure.