An effective MIS should be capable of meeting the information needs of its executives in future as well. To maintain this capability evaluation of MIS and timely action thereof is required. The evaluation of MIS should take in to account the following:
– Flexibility in built, with the system to meet any expected and unexpected information requirement in future.
– Ascertaining the views of the users and the designers about the capabilities and deficiencies of the system.
– Guiding the appropriate authority about the steps to be taken to keep the effectiveness of MIS alive.
COMPUTER AND ITS EFFECT ON MIS
The effects of applying computer technology to information systems can be listed below:
1. Increase in speed of processing and retrieval of data: Modern business situations, are characterized by, high degree complexity, keen competition and high risk and reward factors. This invariably calls for system capable of providing relevant information with minimum loss of time. Manual systems howsoever well organized often fail to match the demand for information for decision-making. Computer with its unbelievably fast computational capability and systematic storage of information with random access facility has emerged as an answer to the problems faced by management. Processing of data in relevant form and design and retrieval of it, when needed, in fact requires considerably less time and facilitate the management action and decision-making. The speed of computer processing is in nano-range, i.e.; an operation takes only billionths of a second. This characteristic of computer has accounted for as a major factor in inducing MIS development. Computers today are capable of meeting varied type of information requirement of executives.
2. Expanded Scope of use of information system: The importance and utility of information system in business organizations was realized by most of the concerns, after the induction of computers for MIS development.
System experts in business organizations develop areas and functions, where computerized MIS could be used to improve the working of concern. This type of applications hitherto, not feasible under the manual system. For example, it was made possible by using an on line real time system to provide information to various users sitting at a remote distance from a centrally located computer system.
3. Widened scope of analysis: The use of computer can provide multiple type of information accurately and in no time to decision-makers. Such information equips an executive to carry out a thorough analysis of the problem
and to arrive at the final decision. Computers are capable of providing various types of sales reports for example, Area wise sales; Commission of each sales man; product wise sales etc. These reports are quite useful in analyzing the sales department working and to ascertain their weaknesses, so that adequate measures may be taken in time. In this way, the use of computer has widened the scope of analysis.
4. Complexity of system design and operation: The need for highly processed and sophisticated information based on multitudes of variables has made the designing of system quite complex. During the initial years, after the induction of computer for MIS development, systems experts faced problems in designing systems and their operations. The reason at that time was the non-availability of experts required for the purpose. But these days the situation is better. The manufacturers have developed some important programs (software) to help their users. Some private agencies too are there who can perform the task of developing programs, to cater the specialized needs of their customers, either on consultancy basis or on contract.
5. Integrates the working of different information sub-systems: A suitable structure of management information system may be a federation of information sub-system, viz., production, material, marketing, finance, engineering and personnel. Each of these sub-systems is required to provide information to support operational control, management control and strategic planning. Such information may be made available by common-data-base.
This common-data -base may meet out the information requirements of different information sub-system by utilizing the services of computers for storing, processing, analyzing and providing such information as and when required. In this way, computer technology is useful for integrating the day-to-day working of different information sub-systems.
6. Increased the effectiveness of information systems: Information received in time is of immense value and importance to a concern. Prior to the use of computer technology for information purposes, it was difficult to provide the relevant information to business executives in time even after incurring huge expenses. The use of computer technology has overcome this problem. Now, it is quite easy to provide timely, accurate and desired information for the purpose of decision-making. Hence, we can conclude, that the use of computer has increased the effectiveness of information system also.
7. More comprehensive information: The use of computer for MIS, enabled system experts to provide more comprehensive information to executives on business matters.
IMPACT OF MIS ON DIFFERENT LEVELS OF CORPORATE MANAGEMENT
Top level of corporate management spends mostly it’s time for business planning. The major responsibilities of this level include long and short-range planning, resource and capacity analysis, setting of profit and budget goals, and in general establishing the business objectives of the company. It is thus apparent that there is a heavy planning and lesser control element in the work domain of top level management.
Presently, the impact of computers and MIS on the working of this level is minimum. The reasons for lesser computer effect on top level are:
(i) Unstructured nature of data
(ii) Slow acceptance and use of operations research techniques (iii) Non-availability of suitable systems and computer experts (iv) Reliance on intuitive abilities.
The impact of MIS on top level too is far less than at the middle or supervisory level. This fact is apparent from the following table, which has been constructed on the basis of several surveys.
Decision Making Process Job Contents Job Members
Top Management Scant Influence Scant Change No Influence
Middle Management Moderate Influence Moderate Change Scant Influence Lower or Supervisory level Major Influence Major Change Moderate Influence In fact MIS in its present form is more effective for control than for planning. Therefore, it can be concluded that the impact of MIM on top management level is almost non-existent.
The potential impact of computers on top level management may be quite significant. An important factor, which may account for this change is the fast development in the area of computer science. It is believed that in future computers would be able to provide simulation models to assist top management in planning their work activities.
For example, with the help of a computer it may be possible in future to develop a financial model by using simulation technique, which will facilitate executives to test the impact of ideas and strategies formulated on future profitability and in determining the needs for funds and physical resources. By carrying sensitivity analysis with the support of computers, it may be possible to study and measure the effect of variation of individual factor to determine the final results. Also the availability of a new class of experts will facilitate effective communication with computers. Such experts may also play a useful role in the development and processing of models. In brief, potential impact of computers would be more in the area of planning and decision-making.
Futurists believe that in future top management will realize the significance of techniques like simulation, sensitivity analysis and management science. The application of these techniques to business problems with the help of computers would generate accurate, reliable, timely and comprehensive information to top management. Such information will be quite useful for the purpose of managerial planning and decision-making. Computerized MIS will also influence in the development, evaluation & implementation of a solution to a problem under decision-making process.
The impact of computers and MIS on middle management is moderate. This level of management translates the management objectives into plans, arranges resources to achieve such objectives and goals as laid down by top management. Also it reviews the result of operations performed at the supervisory level. It thus acts as a bridge between the other two levels. The information provided by computer serves only limited purpose to middle management. Such information is quite effective for carrying out an analysis of the operations but has little impact on the formulation of organizational plans.
Potential impact of computers and MIS on middle management level will be significant. It will bring a marked change in the process of decision-making. At this level, most of the decisions will be programmed and thus will be made by the computer, thereby drastically reducing the number of middle level manager’s requirement. For example, In the case of inventory control system, computer will carry records of all items with respect of their purchase, issue and balance. The reorder level, reorder quantity etc. for each item of material will also be stored in computer after its pre-determination. Under such a system as soon as the consumption level of a particular item of material will touch reorder level, computer will inform for its purchase immediately. The futurists also foresee the computer and the erosion of middle management as the vehicles for a major shift to decentralization.
The new information technology will enable management to view an operation as a single entity whose effectiveness can only be optimized by making decisions that take into account the entity and not the individual parts.
The impact of computers and MIS today at supervisory management level is maximum. At this level, managers are responsible for routine, day to day decision and activities of the organization, which do not require much judgement and discretion. In a way, supervisory mangers job is directed more towards control function, which are highly receptive to computerization. For control, such mangers are provided with accurate, timely, comprehensive and suitable reports. A higher percentage of information requirements of executives are met out at this level.
Potential impact of computers and MIS on supervisory level will completely revolutionize the working at this level. Most of the controls in future will be operated with the help of computers. Even the need of supervisory mangers for controlling the operation/activities now performed manually will be either fully or partially automated.
In future MIS would provide highly accurate, precise and desired information to control operations with the support of computers.
CONSTRAINTS IN OPERATING A MIS
Major constraints which come in the way of operating an information system are the following :
1. Non-availability of experts, who can diagnose fully the objectives of the organisation and give a desired direction needed for operating information system.
2. Difficulty usually faced by experts, in selecting the sub-systems of MIS, to be designed and operated upon first.
3. Source of availability of experts for running MIS effectively, is not always known to management.
4. Due to varied objectives of business concerns, the approach adopted by experts for designing and implementing MIS is non-standardised one.
5. Non-availability of cooperation from staff.
6. Non-availability of heavy financial resources required for running the MIS effectively.
7. Turnover of experts is quite high.
8. It is difficult to quantify the benefits of MIS, so that it can be easily comparable with cost.
9. Perception problems as its utility are not readily perceptible by many users.
LIMITATIONS OF MIS
1. The main limitations of MIS are as follows:
2. The quality of the outputs of MIS is basically governed by the quality of inputs and processes.
3. MIS is not a substitute for effective management .It means that it cannot replace managerial judgement in making decisions in different functional areas. It is merely an important tool in the hands of executives for decision-making and problem solving.
4. MIS may not have requisite flexibility to quickly update itself with the changing needs of time, especially in the fast changing and complex environment.
5. MIS cannot provide tailor made information packages suitable for the purpose of every type of decisions made by executives.
6. MIS takes into account mainly quantitative factors; thus it ignores non-quantitative factors like morale, attitudes of members of the organization, which have an important bearing on decision-making process of executives.
7. MIS is less useful for making non-programmed decision-making. Such type of decisions is not of routine type and thus they require information, which may not be available from existing MIS to executives.
8. The effectiveness of MIS is reduced in the organization, where the culture of hoarding information and not sharing with others hold.
9. MIS effectiveness decreases due to frequent changes in top management organizational structure and operational team.
MISCELLANEOUS INFORMATION SYSTEMS
Transaction Processing Systems (TPS)
A data processing system processes transactions and produces reports. It represents the automation of fundamental, routine processing to support operations. Prior to computers, data processing was performed manually or with simple machines. A management information system is more comprehensive; it encompasses processing in support of a wider range of organizational functions and management processes. However, every MIS will also include transaction processing as one of its functions.
What does it takes into account to make a data processing system into a management information system? Can a rather mundane data processing system be a MIS if a simple database, retrieval capabilities, and one or two decision models are added? This is not a useful question. MIS is a concept and an orientation toward which an information system design moves rather than an absolute state. Therefore, the significant issue is the extent to which an information system adopts the MIS orientation and supports the management functions of an organization. The answer is usually a matter of degree rather than a simple yes or no.
One important aspect of the difference between MIS and routine data processing is the capability to provide analysis, planning, and decision making support. An MIS orientation means users have access to decision models and methods for querying the database on an ad hoc basis; the database is also, of course, an essential part of routing transaction processing and reporting. Furthermore, a MIS orientation means information resources are utilized so as to improve decision-making and achieve improved organizational effectiveness. Information resources are also used as a means of achieving a competitive advantage.