Role and Importance of Management Information System

Role and Importance of Management Information System

Role of Management Information System 

The role of the MIS in an organization can be compared to the role of the heart in the body. The information is the blood and MIS is the heart. In the body, the heart plays the role of supplying pure blood to all the elements of the body including the brain. The heart works faster and supplies more blood when needed. It regulates and controls the incoming impure blood, processes it, and sends it to the destination in the quantity needed. It fulfills the needs of blood supply to the human body in the normal course and also in crisis.
The MIS plays exactly the same role in the organization. The system ensures that appropriate data is collected from the various sources, processed, and sent further to all the needy destinations. The system is expected to fulfill the information needs of an individual, a group of individuals, the management functionaries: the managers and the top management. 
The MIS satisfies the diverse needs through a variety of systems such as Query Systems, Analysis Systems, Modelling Systems and Decision Support Systems the MIS helps in Strategic Planning, Management Control, Operational Control, and Transaction Processing 
The MIS helps the clerical personnel in the transaction processing and answers their queries on the data about the transaction, the status of a particular record, and references on a variety of documents. The MIS helps the junior management personnel by providing the operational data for planning, scheduling, and control, and helps them further in decision making at the operations level to correct an out-of-control situation. The MIS helps the middle management, in short, them plan, target setting, and controlling the business functions. It is supported by the use of the management tools of planning and control. The MIS helps the top management in goal setting, strategic planning, and evolving the business plans and their implementation. 
The MIS plays the role of information generation, communication, problem identification and helps in the process of decision making. The MIS, therefore, plays a vital role in the management, administration, and operations of an organization. 

The Importance of MIS to Management 

In all but the smallest organizations management rarely observe operations directly. They attempt to make decisions, prepare plans, and control activities by using information that they obtain from formal sources, for example, the organization’s MIS, and also by informal means such as face-to-face conversations, telephone calls, social contacts, and so on. A management information system is generally thought of as an integrated, user-machine system providing information to support operations, management, and decision-making functions in an organization. As a matter of fact, an MIS is a special-purpose system useful for management in an organization. MIS is an accessible and rapid conveyor belt for appropriate high-quality information from its generation to its users. The heart of an effective MIS, therefore, is a carefully conceived, designed, and executed database. Its level corresponds to adaptive decisions. 

The characteristics of MIS in practice include: 

  • An information focus, designed for managers in an organization: 
  • Structured information flow
  • Integration of data processing jobs by business function , such as production of MIS , personnel MIS and so on ; and 
  • Inquiry and report generation , usually with a database

Impact of the Management Information System

Since the MIS plays a very important role in the organization, it creates an impact on the organization’s functions, performance, and productivity. The impact of MIS on the functions is in its management. With good support, the management of marking, finance, production, and personnel become more efficient The tracking and monitoring of the functional targets become easy. The functional, managers are informed about the progress, achievements, and shortfalls in the probable trends in the various aspects of the business. This helps in forecasting and long-term perspective planning. The manager’s attention is brought to a situation that is exceptional in nature, inducing him to take any action or a decision in the matter. A disciplined information reporting system creates structured data and a knowledge base for all the people in the organization. The information is available in such a form that it can be used straight away or by blending analysis, saving the manager’s valuable time. 
The MIS creates another impact in the organization which relates to the understanding of the business itself. The MIS begins with the definition of a data entity and its attributes. It uses a dictionary of data, entity, and attributes, respectively designed for information generation in the organization. Since all the information systems use the dictionary, there is a common understanding of terms and terminology in the organization bringing clarity in the communication and a similar understanding even of the organization. 
The MIS calls for the systemization of the business operation for an effective system design. A well-designed system with a focus on the manager makes an impact on managerial efficiency. The fund of information motivates an enlightened manager to use a variety of tools of the management. It helps him to resort to such exercises as experimentation and modeling. The use of computers enables him to use tools techniques that are impossible to use manually. The ready-made packages make this task simpler. The impact is on the managerial ability to perform. It improves decision-making ability considerably. Since the MIS works on the basic systems such as transaction processing and databases, the drudgery of the clerical work is transferred to the computerized system, relieving the human mind for better work. It will be observed that a lot of manpower is engaged in this activity in the organization. If we study the individual’s time utilization and its application; we will find that seventy percent of the time is spent in recording, searching, processing and communication. This is a large overhead in the organization. The MIS has a direct impact on this overhead. It creates an information-based work culture in the organization.

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