MIS processes information using computers and intelligent systems to support better organizational decision-making. Management of information systems can include concepts like decision support systems, expert systems, transaction processing systems, and executive information systems. In the academic scenario, the term is often associated with studying business. Fields of study like information technology, computer science, informatics, e-commerce, and information systems are closely related to management info systems. This subject is studied as a part of the management program, and many universities offer specialization in MIS systems besides finance, marketing, human resource management, management, accounting, etc.
History Of MIS
With technological advancement, management information systems have developed rapidly over the past several decades. IBM designed the earlier MIS systems, which involved mainframe computers, which were large and required considerable space. The mainframe computer of IBM required a separate staff to operate the computer. Then came the minicomputers, which dominated most of the early '60s. After the introduction of personal computers with the invention of microprocessors, the dynamics of MIS changed and moved from large data centres to smaller offices. After the 70s, there was a substantial decline in the price of computers, and companies could provide their employees with computers, which has since revolutionized management information systems.
Types Of Management Information Systems
Several MISs can operate simultaneously in a business, fulfilling the different requirements of the other divisions within an organization. The senior management might require information to help them with business planning and decision-making. The middle management may require information following the activities relating to the functioning of the business. Sometimes the employees may also need MIS to know their duties. Some of the types of management information systems are listed below.
- Executive support systems (ESS) – This system is for senior management. It helps the management to make strategic decisions. ESS uses the internal and external information of the business through modelling and data analysis tools.
- Business management information systems (EMIS or MIS) – The primary function of this information system is to analyze the internal source of information. It uses transaction processing systems to prepare management reports. The operational and middle-level managers utilize these reports.
- Decision support system (DSS) – This type of system is designed primarily to assist the management in decision-making when the decision outcome is uncertain. DSS utilizes spreadsheets and databases to provide interpretable information for complex problems.
- Knowledge management systems (KMS) generate and exchange information within the organization. It is done in organizations where employees generate new data and expertise in the field and can be shared with other employees. It is usually practised in organizations or firms like lawyers, management consultants, and accountants.
- Transaction processing systems (TPS) – Every business applies TPS to process various transactions. A few examples of TPS can be the billing system used to generate an invoice and send it to the clients, methods used to calculate the weekly, monthly, and yearly payroll and tax payment, keep track of the raw materials purchased and sold, and control of stock within the business.
- Office automation systems – It includes a wide range of software that increases the employees' productivity. Software like MS Office systems that regulate the working of employees from home are office automation systems.
Purpose Of Management Information System
The purpose and importance of management information systems can be observed in accepting this system in almost all companies worldwide, whether big, medium or small. Every company applies some or other form of MIS for the daily functioning of its activities. Some of the importance of management information system resources are described below.
- Every organization has multiple functional departments, including financial, customer support, sales, logistics, human resource, etc. MIS combines all the information from different departments to help managers better manage the activities of a business. It is one of the core functions of a management information system.
- The most important aspect of a management information system is to help managers make decisions. It is the core feature as the primary purpose of MIS is to make the business process easy and profitable.
- MIS is understood as a specific combination of systems that fulfils business needs. It can be developed to match any of the organization's requirements. CRM and ERP are important examples of systems developed for a specific activity in an organization.
- It can help assess individual departments' performance; this allows the less-performing department to evaluate its previous version and determine the areas where change is needed.
Organizations use several MIS systems for their daily activity. Before including any management information system in a business, a detailed analysis of the requirement of the system must be made. If the cost of MIS is more than the benefit it brings to the company, then such a system is useless and fails to serve its primary function and, thus, must not be implemented.