Definitions

• Management information systems (MIS) are integrated

computer-based networks and applications that
collect, store, and analyze data to help business leaders
and managers make informed decisions.
• Management Information System is flow-processing
procedures based on computer data, and integrated
with other procedures in order to provide information
in a timely and effective manner to support decision-
making and other management functions.
 Functions of management information
systems
• Data collection and storage : Management information systems
gather and store data from various sources, such as sales
figures, stock levels, financial statements, and employee records.
MIS serves as a repository of information, ensuring all relevant data
is accessible to decision-makers.
• Data processing : MIS processes raw data into a more usable form
by sorting, classifying, calculating, and interpreting. By turning vast
amounts of raw data into meaningful information, MIS can make it
easier to identify trends and insights. This involves the creation of
reports, visualizations, and summaries that aid managers in
understanding the current state of the business and forecasting
future scenarios.
• Data management: These systems organize and maintain data
systematically, ensuring accessibility and regular updates. Effective
data management keeps information relevant and reliable for
business planning.
•
Advantages of MIS
Enhanced Efficiency : MIS can improve business processes by automating tasks and integrating
data from multiple systems. This integration facilitates efficient data management and report
generation. By automating routine tasks, MIS can reduce time spent on manual processes,
enabling staff to concentrate on strategic initiatives.
For example, in a health care clinic, an MIS could automate the entry of patient records into a
central database. This reduces the time staff spend on manual entry and minimizes errors,
ensuring health care providers have immediate access to accurate, up-to-date information for
each consultation.
• Improved Decision making: MIS provides accurate and timely information for decision-making in
various business areas, including financial planning and marketing. By leveraging data
from enterprise resource planning systems, which integrate various business functions like
finance, supply chain, and human resources into a cohesive framework, managers gain insights
for strategic planning and operational adjustments.
Example: At a retail store, for example, an MIS could generate a monthly sales report with
visualizations of regional sales performance and customer buying trends. This enables
managers to make data-driven decisions on inventory management and targeted marketing
campaigns.
• Risk Management: MIS identifies potential issues by analyzing patterns in data. This proactive
detection, especially in financial operations and supply chain management, allows for timely
interventions.
Example: At a financial services firm, the MIS processes raw data from market trends, client
investment portfolios, and economic indicators. It summarizes it into an easy-to-understand
dashboard that helps financial analysts identify emerging investment opportunities and market
 Types of MIS
• Management reporting systems
Ther produce operation-focused reports, including financial, attendance,
accident, and efficiency metrics. They collate business data from various systems
within an organization to provide management with consolidated information for
evaluation and oversight. This aids in assessing company operations, financial
output, and goal achievement​​.
• Sales and marketing systems
They enable the tracking of sales figures and advertising effectiveness. These
systems assist in understanding distribution channels and customer response.
This aids marketing managers in gauging projected sales and developing
strategies for future improvements based on current patterns and profits.
• Accounting and finance systems
Accounting and finance MISs track a company’s assets and investments, assisting
with functions like financial statement generation and tax compliance. These
systems facilitate the creation of financial audits, annual reports, and daily
transaction management. They provide insights into a company’s financial health
through profit-and-loss statements and balance sheets​​.
• Human resource systems
A human resource MIS controls information flow related to overseeing the
activities of employees, supervisors, and contractors. It manages critical HR
functions like payroll, benefits, compliance, and recruitment. These systems also
monitor work attendance, timesheets, and leaves.
• Inventory management systems
Inventory management systems track and report on a company’s inventory,
assessing the impacts of spoilage, theft, or sales. They assist purchasing managers
in decision-making for restocking and ensure safe inventory transit within
warehouses. These systems are vital for maintaining business efficiency and
managing customer returns.
• Process control systems
Process control systems monitor and report on production line processes, such as
steel or automobile manufacturing. They continuously gather data to evaluate
product quality and process efficiency, identifying irregularities in production.
Essential for manufacturing companies, these systems regulate product
consistency and performance​​.
• Decision support systems
Decision support systems compile information from internal and external sources
to assist in business decision-making. They integrate with existing systems to
collect data from various departments with external market trends and economic
indicators. This supports decisions like business expansion, work quotas, or policy
formulation​​.
• Transaction processing systems
Transaction processing systems streamline an organization’s daily transactional
activities, such as payroll processing, accounts payable, and accounts receivable. A
transaction processing system automates and manages repetitive and consistent
operational tasks. It enhances the efficiency and accuracy of financial transactions
and routine business processes.
• Executive information systems
Executive information systems provide executives
with comprehensive reports on company data. They
compile processing records and financial data into
quick-to-read formats like charts and spreadsheets.
These systems are instrumental for executives in
conducting comparative research and identifying
efficiency improvements.
 Chapter 1: Information Systems in
Global Business Today
• How are information systems transforming business,
and why are they so essential for running and
managing a business today?
• What is an information system? How does it work?
What are its management, organization, and
technology components? Why are complementary
assets essential for ensuring that information
systems provide genuine value for organizations?
• What academic disciplines are used to study
information systems, and how does each contribute
to an understanding of information systems?
• Most of the business value of IT investment
derives from these organizational, management,
and cultural changes inside firms due to new
technologies.
• As managers, most of you will work for firms that
are intensively using information systems and
making large investments in information
technology. You will certainly want to know how
to invest this money wisely. If you make wise
choices, your firm can outperform competitors. If
you make poor choices, you will be wasting
valuable capital
 How Information Systems Are
Transforming Business?
• You can see how people conduct business. Changes in
technology and new, innovative business models have
transformed social life and business practices:
- 2.8 billion people worldwide have smartphones.
- an estimated 1.26 billion use their smartphones for Internet
access. More than 1 billion people use tablet computers.
- In developing and emerging countries, phones and tablets are
the primary means of access to the Internet.
• - 150 million businesses worldwide had dot-com Internet sites
registered.
• social networking, texting, e-mailing, and webinars have all
become essential tools of business because that’s where your
customers, suppliers, and colleagues can be found.
• Global e-commerce and Internet advertising continue to expand
• These changes in information technology and
systems, consumer behavior, and commerce have
spurred the annual growth of digital information
to over 5 exabytes every few days.
• A recent study concluded that the value of
information flowing between countries has grown
45 times since 2005, and the value of this
information now exceeds the value of goods and
finance exchanged.
 What’s New in Management
Information Systems?
1- IT Innovations. A continuing stream of information
technology innovations is transforming the traditional
business world.
Examples include the emergence of cloud computing, the
growth of a mobile digital business platform based on
smartphones and tablet computers, big data, business
analytics, and the use of social networks by managers to
achieve business objectives.
• These innovations are enabling entrepreneurs and
innovative traditional firms to create new products and
services, develop new business models, and transform the
day-to-day conduct of business.
• In the process, some old businesses, even industries, are
being destroyed while new businesses are springing up.
2- New Business Models. For instance, the
emergence of online video services like Netflix for
streaming, Apple iTunes, Amazon, and many others
for downloading video has forever changed how
premium video is distributed and even created.
3- E-commerce Expanding. E-commerce is changing
how firms design, produce, and deliver their
products and services.
E-commerce has reinvented itself again, disrupting
the traditional marketing and advertising industry
and putting major media and content firms in
jeopardy.
• Management Changes. The management of business firms
has changed: With new mobile smartphones, high-speed
wireless Wi-Fi networks, and tablets, remote salespeople on
the road are only seconds away from their managers’
questions and oversight. Business is going mobile, along with
consumers. Managers on the move are in direct, continuous
contact with their employees.
• The growth of enterprise-wide information systems with
extraordinarily rich data means that managers no longer
operate in a fog of confusion but instead have online, nearly
instant access to the really important information they need
for accurate and timely decisions. In addition to their public
uses on the web, wikis and blogs are becoming important
corporate tools for communication, collaboration, and
information sharing.