Applications of Management Information System
With computers being as ubiquitous as they are today, there’s hardly any large business that does not rely extensively on their IT systems.
However, there are several specific fields in which MIS has become invaluable.
While computers cannot create business strategies by themselves they can assist management in understanding the effects of their strategies, and help enable effective decision-making.
MIS systems can be used to transform data into information useful for decision making. Computers can provide financial statements and performance reports to assist in the planning, monitoring and implementation of strategy.
MIS systems provide a valuable function in that they can collate into coherent reports unmanageable volumes of data that would otherwise be broadly useless to decision makers. By studying these reports decision-makers can identify patterns and trends that would have remained unseen if the raw data were consulted manually.
MIS systems can also use these raw data to run simulations – hypothetical scenarios that answer a range of ‘what if’ questions regarding alterations in strategy. For instance, MIS systems can provide predictions about the effect on sales that an alteration in price would have on a product. These Decision Support Systems (DSS) enable more informed decision making within an enterprise than would be possible without MIS systems.
not only do MIS systems allow for the collation of vast amounts of business data, but they also provide a valuable time saving benefit to the workforce. Where in the past business information had to be manually processed for filing and analysis it can now be entered quickly and easily onto a computer by a data processor, allowing for faster decision making and quicker reflexes for the enterprise as a whole.
Types of management information systems
There are many types of management information systems in the market that provide a wide range of benefits for companies.
- Transaction processing systems (TPS) collect and record the routine transactions of an organization. Examples of such systems are sales order entry, hotel reservations, payroll, employee record keeping, and shipping.
- Management information systems (MIS) produce fixed, regularly scheduled reports based on data extracted and summarized from the firm’s underlying transaction processing systems (TPS) to middle and operational level managers to provide answers to structured and semi-structured decision problems.
- Decision-support systems (DSS) are computer program applications used by middle management to compile information from a wide range of sources to solve problems and make decisions.
- Executive support systems (ESS) is a reporting tool that provides quick access to summarized reports coming from all company levels and departments such as accounting, human resources and operations.
- Expert system (ES) is a knowledge about a specific area to act as an expert consultant to the user. It is no the replacement of human being rather they help them in using their expertise more efficiently and effectively. When we join the concept of artificial intelligence with information system, the result is an Expert System.
- Office automation systems (OAS) are meant for improving the communication and productivity of people in the enterprise. They attempt to automate office procedures and remove bottlenecks, lacuna in the secretarial work. These systems are helpful to all levels of management.
Benefits of Management Information System
The field of MIS can deliver a great many benefits to enterprises in every industry. Expert organizations such as the Institute of MIS along with peer reviewed journals such as MIS Quarterly continue to find and report new ways to use MIS to achieve business objectives.
Every market leading enterprise will have at least one core competency – that is, a function they perform better than their competition. By building an exceptional management information system into the enterprise it is possible to push out ahead of the competition. MIS systems provide the tools necessary to gain a better understanding of the market as well as a better understanding of the enterprise itself.
Enhance Supply Chain Management
Improved reporting of business processes leads inevitably to a more streamlined production process. With better information on the production process comes the ability to improve the management of the supply chain, including everything from the sourcing of materials to the manufacturing and distribution of the finished product.
As a corollary to improved supply chain management comes an improved ability to react to changes in the market. Better MIS systems enable an enterprise to react more quickly to their environment, enabling them to push out ahead of the competition and produce a better service and a larger piece of the pie.
- Increased brand equity
- Boost production processes
- Impact mass customization production processes
- Leverage learning curve advantages
- Leverage IT investment in computer aided design
- Leverage stability
- Expand E-commerce
- Improve B2B commerce
Five Elements of usable MIS
Difference between MIS and Traditional Information system
Although Management Information Systems and Information Systems are segments of Information Technology, both are entirely diverse streams. Management Information Systems deals with the overall in-house controls of an industry covering the employees, documents, know-how, and measures adapted by administration accountants to unravel business tribulations like estimating and pricing a product, service or a business-wide strategy. However, Computer Information Systems is concerned with the integration of computers, data, software packages and management techniques to carry out the day-to-day operations of an organization.