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Management Information System: Role, characteristics and advantages

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The Role, Characteristics, and Advantages of Management Information System

The business world has undergone significant transformations over the last two decades, mainly driven by IT and digital technology. Information technology is now an integral part of business operations for millions of businesses globally. Business functions ranging from human resources to finance, marketing, and customer service depend on IT resources for performance and productivity.

IT is everywhere, from businesses and jobs to people’s personal lives and education. Digital technology has helped people and organizations grow their productivity and increased the convenience people enjoyed in their lives. However, in the business world, its importance has increased manifold because IT and digitalization have accelerated decision making and improved business processes including manufacturing and marketing, by making data processing easier for business managers and executives.

The growing importance of IT is clear from the fact that data has become central to all the valuable decisions in the business world. Today, organizations handle tons of data, starting from their supply chains to manufacturing, sales, and customer service functions. All this data needs to be processed and turned into actionable reports to facilitate decision-making by the management and leadership. Managers depend on real-time data for making critical decisions daily. Manipulating and turning data into actionable reports has never been easier. It is an essential advantage that businesses gain from the use of MIS. Management Information System or MIS has become a valuable tool for facilitating decision-making in the entire industry. It has filled a significant gap and drives higher operational efficiency and productivity organization-wide. Without the MIS, handling tons of data and converting it into actionable information would have remained impossible.

It is also the primary reason behind the growing interest in MIS. There is another factor as well, which is driving higher MIS use inside organizations. Higher competition in this era requires that managers and business leaders make faster and better decisions. Due to increased competition as well as higher operational pressures, managers have to make decisions faster based on the data and information in their hands. It is made possible through the use of MIS.

An MIS can present such data into actionable reports based upon which managers and executives can make decisions and formulate operational and marketing strategies. The type of reports that can be produced using an MIS is not limited to just one but you can format the same data tables into various reports to suit different needs and find solutions to many questions. Moreover, IT has grown quite advanced, and a large variety of hardware and software is available to process data at a faster pace and with higher precision and efficiency. However, that does not reduce the importance of MIS. Many of the modern information systems, including CRMs, have evolved based upon the needs of users. Data has grown central to decision-making, and that has made the importance of information systems grow.

What is a Management Information System?

Based upon the type of need it serves, an MIS is an organizational method of providing past, present, and projected information related to internal operations and external intelligence. It supports the planning, control, and operation functions of an organization by furnishing uniform information in the proper time frame to assist the decision-makers” (Waston, 1987).

There are other definitions too. Roughly speaking, an MIS is an Information Technology based system that organizes data and publishes it in the form of actionable reports which can be shared across the entire organization and used at various levels for decision making and business operation.  One primary advantage of having a shared MIS is that the right information is available at the fingertips of the business managers whenever they need it. Information technology can be a source of competitive advantage for businesses, and so can be a management information system. However, we will discuss the benefits of MIS later on in this article.

One can still understand an MIS as the heart of the decision-making process. The MIS has also evolved with the evolution of Information technology and hardware and software. Nowadays, it is possible to share data and reports with managers sitting in other corners of the world using high-speed internet and websites. Organizations manage large databases of customers and users, which managers can access for planning and decision making. In today’s world, data is power and can help you stay ahead of your competitors.

What are the functions of an MIS?

The broad functions of an MIS can be defined as follows:

Improved decision making:

One primary function of an MIS is to aid and improve decision-making. It does that by providing accurate information faster, which is then used by managers for making crucial decisions. By improving decision-making, it also works to improve the bottom line and profitability of the business.

Efficient operations:

MIS improves operational flow by providing the required information at the right time. The managers can perform their tasks with higher ease, and that enhances the productivity of the business.

Better communication and connectivity:

A central MIS helps improve the entire communication channel and provides better connectivity throughout the organization across all levels of management.

What are the main components of an MIS?

MIS has five main components that include:

Hardware:

Hardware means the machinery part of the MIS. You cannot run or access an MIS without the necessary hardware like computers, printers, servers, and other machinery. The machinery is required to process the data and access it when needed. You can upload the information or prepare an online MIS which different users can access and study from their desktops with a password. A shared MIS is often available to various levels of management, accessed via desktops or laptops, and printers.

  

Software:

The software is required to prepare the MIS. Apart from the system software like Mac or Windows, you may also need to use other software like accounting, payroll, or different kinds of software like CRM. The software runs on the hardware and is used to prepare the MIS as well as to access it. For unique information systems, you will also need to have special software in place to run and read the MIS.

Data:

Data is a core component of any and every MIS. Different business organizations have various sources and types of data. Banks and other financial institutions record financial data, whereas hospitals and other health agencies record health-related and other forms of personal data of the patients. In this way,  the type and volume of data can vary depending upon the needs of the business organization and its products/services. Data is the fuel for an MIS, and without it, the MIS has no purpose or, simply speaking, is meaningless and irrelevant.

Procedures:

Procedures or processes are also a critical component of MIS, whose purpose is to generate the most relevant reports. Users must be able to create various kinds of reports based on their use. They must also be able to restructure it as per the changing needs as well as the shape and size of the organization. Using an MIS also needs well-defined processes developed by people.

People:

These are the end-users who benefit from the MIS and the reports it generates. They include the IT department professionals, managers, and other people who might need to access the information in the MIS or have the right to.

What are the Advantages of Management Information System?

An MIS can be a source of competitive advantage since the faster the decision-making cycle, the more excellent your operational cycle and the more competitive your business. The competitiveness of your business depends upon the effectiveness of your business decisions. Increased competition in the business industry requires that decisions are made at a faster pace and that the operational flow does not get obstructed. In a fast-moving environment, business managers may be forced to make decisions instantaneously or risk losing their market share. They need data and tools that cater to their information needs effectively and efficiently.  MIS acts as a catalyst, speeding up the entire flow of work by aiding decisions with data and information. Some of the key advantages that come from MIS and can lead to a source of competitive advantage in terms of business strategy and operations are as follows:

  • It caters to the diverse information needs of managers and the entire organization, apart from the key decision-makers.  The same set of data can be used to generate various forms of reports depending upon the need. Managers can have a look at the data from several angles to learn about various aspects of the problem at hand and make effective decisions.
  • MIS can also create better communication flow by filling the information gaps and driving performance. It removes communication hindrances by supplying appropriate pieces of information at the proper time, allowing for a more effortless flow of information across various levels.
  • A significant advantage of MIS is that it provides precise information promptly that can be used to make the right decisions. Timeliness is critical because data available at the right time can be a crucial advantage. Otherwise, a delay can make the same piece of information obsolete and render it useless. You get the right information late, you lose a critical customer or another valuable partner and thus lose a crucial advantage. Speed matters, and so does the timeliness of data and information.
  • When decisions are based on facts, they are more effective, and in today’s hyper-competitive environment, business managers must base their decisions on facts. A simple but essential piece of data can change the entire course of an important decision and lead to higher turnover. Strategic decisions need to be based on data and facts, and MIS caters efficiently to this need. Business executives have to make crucial decisions, and they cannot go through entire big sets of data to do this. They must have access to reports upon which they can base their decisions. In this way, MIS helps managers and business executives make fact-based and effective decisions by providing customized reports.
  • An MIS is not just to aid decision making, but it also ensures better operational flow. The entire work is not being performed by the business executives alone.  Even the managers and associates at the front end require data and reports to make decisions and take appropriate action. MIS helps with the overall operational flow through easy, quick, and secure sharing of data across the various levels of management. We will discuss it later in this article, how MIS caters to the need of people sitting at various levels within an organization.
  • MIS can also be used to establish better control throughout the organization and manage your resources more efficiently.
  • It can be used for more efficient forecasting of a business’s future. Reports generated periodically can be used by managers to understand trends and, based upon them, make forecasts about future circumstances. Accordingly, a business can set the strategic course that can help it sail safely towards desired outcomes.

In this way, there are several advantages to be derived from a Management Information System. These advantages range from short term to long term. What is worth noting that an MIS makes efficient management of business through strategic planning and decision making possible.

Role and Importance for Various Levels of Management:

Precise data and information are required by managers on all tiers of an organization to make the right decisions and drive organizational performance. However, the needs at each level may differ. The information needs differ between the upper and the lower levels of management.

The frontline manager would need mostly need clear, precise, quantifiable, and internal information. In contrast, at the top level, the managers would need mostly external information that is summarised and future-oriented. The reason is that the type of decisions managers at various levels make can differ. However, MIS plays a vital role at each level, and sometimes different Information Systems have to be integrated into one to serve the information needs of the entire organization.

Clerical people/operational managers:

MIS helps the operational level user with transaction processing, management control, operations control, etc.

Junior Management:

MIS provides operational data and information that junior-level managers can use for efficient operational decision-making. It also helps with planning, scheduling, and controlling at the operational level. Apart from that, it aids in decision analysis at the operational level that can be used to bring an out-of-control situation under control.

Middle Management:

MIS provides the middle management with the data and information required for short term planning, setting targets as well as for managing the business.

Top-level management:

The top-level management requires the MIS for having precise and targeted information that helps it with goal setting, strategic planning and other things that the top managers are required to do.

Important Characteristics of MIS:

The forms of MIS have evolved with the evolution of technology and despite their changing forms, the basic characteristics of MIS have remained the same. The main characteristics of MIS are discussed below:

Management oriented:

The main focus of the MIS is to cater to the information needs of the management and so it is designed with that clear focus. It is designed around the needs felt by the several levels of management.

Management Directed:

Since the MIS is mainly meant to cater to the needs of the management, it also has a strong role in the creation and control of the MIS. It has a major role in the creation as well as the continuous development of the MIS. The MIS should evolve with the evolving needs of the management and the business and evolving technology. One important thing is to design and maintain it as per the needs and expectations of management.

Integrated :

Management Information System is an integrated system that is linked to all the operational and functional activities of the management. This characteristic is more of a requirement that MIS must confirm to. Moreover, the reason behind MIS being an integrated system is that the need for information for decision making arises in all corners of an organization. Managers need information for everything including decision making, rooting out obstructions, giving go-ahead to new projects as well as for resource allocation. Isolated systems do not make an MIS because that will make it lose its true meaning and relevance. Moreover, managers need more complete information in the form of detailed reports to make crucial decisions. This purpose can be served only through an integrated system and not with the help of several isolated systems serving isolated purposes. Even if you work with isolated systems, you need to generate a final integrated report to gain a clear picture 

Common data flows:

The integrated approach towards MIS ensures that duplication and redundancy can be avoided. It helps at keeping operations simplified. MIS performs the storage, dissemination, and processing of data in an integrated manner.

Strategic Planning:

An MIS cannot be designed in a short period but requires meticulous planning. It is because an MIS is not designed to serve just the short term needs of an organization but it must be designed in a manner that it can serve the organization for the next five to ten years. MIS is not designed just to meet the information needs of the managers. They have to be designed after careful planning because as the data needs of the organization evolve, the MIS must not become obsolete but must remain relevant even in the long term.

Bias towards centralization:

The bias towards centralization in an MIS is because of the fact that if the information is entered, updated and deleted from several points then providing correct information to all the managers would difficult. A centralized data repository ensures that version control can be exercised and an integrated common view of the data can remain available to the managers. When data is entered and updated from one point, then problems related to incorrect data and reports can be minimized and the same information remains available to all.

Information and communication technology-enabled:

Competition has kept growing intense, and that has increased the need for timely and accurate data. Managers need accurate data at the right time to make the right decisions. It can be made possible only through the use of information technology. Moreover, any MIS relies on IT in today’s environment. To ensure that these information systems operate smoothly, it is essential that the MIS remains up to date and uses the latest technologies.

Inside most of the business organizations in every industry, MIS is solving some of the most critical problems, including handling tons of complex data and presenting it in the form of actionable reports which can then be used for studying trends and forecasting the future. Organizations come across tons of data daily, which cannot be processed without the support of an MIS. There are several critical problems related to decision making, and efficient decision making is vital to remain ahead of your competitors. MIS can be a source of the most critical competitive advantage, which is efficient decision making. However, an MIS is not a panacea in itself, which is because, like any system, it is also subject to limitations.

What are the limitations of an MIS?

– An MIS is useful only if it is a well designed MIS. If not, then it is of very little relevance because a poorly designed MIS will not serve its purpose. An MIS must fit the information needs of the managers. If not, or if it serves the goal with less efficiency, then it is useless for the organization.

– MIS is for skilled users, and only qualified users can leverage the power of an MIS and benefit from it. If the users are untrained or only partially skilled at the use of MIS, then its full potential will not be utilized.

–  An MIS is nothing without data, and MIS data must be updated regularly. Data is like fuel or raw material for MIS. If the data in an MIS is obsolete or outdated, the reports generated will be of no use, which will not aid decision making.

How important is an MIS for the business managers and organizations? Can they manage without it?

The answer is a clear no. Managers cannot do without the aid of MIS for decision making. They cannot ensure operational excellence without access to all the information and complete reports for making critical decisions. In today’s highly competitive environment, businesses and managers cannot do without the Management Information System. It will not just stifle decision making but will also harm operational flow. The business environment has grown fiercely competitive, and every small piece of data is critical to understanding a business’s current environment and challenges. Nothing serves the purpose better than the MIS, and managers cannot make serious decisions when billions are at stake without having clear and precise as well as actionable information in their hands.

There are several questions that managers have to ask themselves before reaching a decision. It will become difficult to answer these questions without the MIS. The absence of the MIS will not just stifle communication and decision making, but also grow the barriers to operational flow. It is just as crucial for the senior decision-makers as for the frontline managers. Imagine tons of data that the businesses accumulate daily, and what if managers do not get actionable reports from this data.

They cannot act based on raw data until it has been processed to create relevant reports from which managers can derive clear conclusions. Summarised statements that provide a clear glimpse of ongoing trends and the changes that have happened in the recent period will help them foresee the future and chart an appropriate course of action. Even short term operational decisions need to be based on such reports. Managers may need to track weekly developments and changing consumer preferences based on sales data. So, MIS facilitates analysis and managerial decision making, and therefore, it is an essential support for managers.

What are the main types of reports that can be produced using an MIS?

Following are the main  types of reports that can be generated using a Management Information System:

Summary reports:

As the name suggests, summary reports summarise data and present it in a consolidated form. These reports aggregate data from several categories like accounting periods, product categories, etc. and present it in a way that managers can review and analyze conveniently. Some of the most common summary reports are sales summary reports, inventory reports, etc. An inventory summary report can present information on inventory in stock, its total value, and the recent purchases. A sales summary report will offer sales data grouped under different categories, like product categories and geographic regions.

Trend reports: 

The trend reports make it easier for the managers to understand trends. For example, you would like to compare the sales trends in America versus that in Asia for a specific product. You can learn about the performance of particular business units and product categories over a given period.  Such reports can be used to analyze historical trends and identify grey areas that require specific focus. For example, if sales of a specific product have kept falling in China, the management may need to define a new sales or marketing strategy or might need to release a new product there.  Trends are significant to study since if a particular product has not been performing well in a specific market over a given period, then you cannot expect it to start performing well in the future. The management may need to make alterations to its strategy to increase sales, or it may just discontinue the product. Trend reports also help brands remain competitive and perform well in the market by understanding trends and using the information to predict sales and formulae the right sales strategy.

Exception Reports:

As the name suggests, exceptions reports are based on data that does not fall within normal ranges. Exception reports focus on this unusual data and present it separately so managers can pay immediate attention to such exceptions. Rather than having to go through each account, the managers get to review all such unusual conditions in one place in a single report. For example, one can set an exception for low stock, and that will help the store manager notice which products’ supplies are running low, and there is a need to order immediately. Such exception reports also prove useful in the areas of HR and finance.

On-demand reports:

The on-demand reports are reports specific to the demand of the situation and the manager.  Such reports can be presented in the form of a customized report or in one of the summary or trend report format.  For example, a business manager would like to know which products are most popular during the holiday season. He would also want to know which products are more popular in the UK and which ones in Australia. A marketing manager can use these reports to know which products would need to be advertised more often and if a change in promotion or pricing strategy can affect their sales.

Value of MIS for Small Businesses:

Even small businesses stand to benefit from the use of MIS. Whether it is a doctor’s office or a small retailer, MIS can be used for planning as well as for the perfect allocation of the limited resources at your dispense. If small businesses can install MIS software, it will help them keep track of business performance, and based upon this information; they can make better use of their human and financial resources. Even the small businesses face heavy competition, and their survival also depends on careful planning as well as proper control and management. Some of the main benefits that come from the utilization of MIS in the case of small businesses are as follows:

– Internal processes have to be formulated and established based upon MIS reports which will help at better utilization of the limited human and financial resources. This helps manage the organizational productivity and performance of the human capital better.

– Small businesses too need specific, demand-based and effective information to remain competitive and this purpose can be served using an MIS.

– Efficient control of personnel and operations.

– Efficient office management and reduction in operational costs.

– Predict future trends and take action before competing businesses.

An MIS does not mean extra expenses for a small business. Instead, it will help you overcome performance bottlenecks and derive better results from the resources at your dispense. For example, if a doctor can keep an MIS, it will help him manage a patient’s data better and will allow him to link it with insurance and billing companies easily. A retailer can keep track of inventory in stock and manage it better. Moreover, there are not any significant costs involved in maintaining an MIS apart from the cost of hardware and software and some necessary skills. In several cases, it will only help a small business fill significant performance gaps and bring operational costs lower.

Advantages of a Cloud Based Management Information System

Cloud technology is helping businesses solve a myriad of computing and data storage related problems. Several industries, apart from the technology industry have found faster growth with the help of cloud technology. Apart from quicker decision making and faster business processes, companies are utilizing cloud computing to solve a vast range of challenges. Having a cloud based MIS can also eliminate some common challenges that enterprises face. Maintaining on premises IT systems can increase the operating costs for businesses. However, a cloud based MIS is not just securer but also much easier to access. Some of the leading benefits of cloud based management information system are noted below:

  • Security: It is generally securer to store your data in the clouds than have it on your premises. When you store your data in the clouds, the exclusive responsibility of its security falls on the provider. The large cloud providers like Amazon, Microsoft or Salesforce have highly secure cloud computing systems that are generally much safer compared to the inhouse IT systems. So, apart from keeping your data safe in the clouds, a cloud based MIS also ensures continuity and reliability of service. It is not very costly either and the organization remains free from the security and maintenance related worries.
  • Scalability: As an organization grows, its IT related needs grow. Business expansion also leads to a growth in the volume of data generated daily and the need to process a larger volume of data cannot be met by a small information system. However, maintaining an inhouse management information system or IT system can give rise to some difficulties. It is generally costlier to grow your own infrastructure than to use cloud technology enabled systems. Scalability becomes a problem especially when your business is growing fast. On the other hand, a cloud based MIS is generally easier and cheaper to scale. It allows you to utilize economies of scale to grow your productivity and meet peak demand without incurring huge costs while also ensuring continuity and efficiency. The processing capacity of the existing MIS can be easily increased by buying extra resources from your existing provider. Organizations may especially need to increase their IT resources during the peak season. They can change the configurations based on their needs. Most cloud providers charge for only the resources consumed. So, having your data in the clouds can be safer as well as cheaper for organizations than the inhouse systems. 
  • Efficiency: Cloud based management information systems are generally faster as compared to the inhouse MIS. Maintaining on site servers will require money as well as time. Companies will have to hire IT managers who are skilled at the task. They will need to manage complex IT systems in order to have everything in house. However, when a company uses a cloud based MIS, it does not only benefit from the large variety of resources and various add on targeted at providing higher efficiency, but also saves time. Otherwise, a  lot of time is lost in managing complex IT systems. The organization gets to save labor hours as well as money and remains free from the tensions of managing in house IT systems.
  • Mobility: Another major benefit of having cloud based MIS is the mobility that comes with using cloud based resources. Extra mobility means the managers can access data and information from anywhere using the internet and shared resources. The enterprise can share the MIS with all the managers who need access. Moreover, only the people who are authorized will be able to access the MIS. This can also improve the work experience for your employees and managers. Organizations can offer limited or full access to particular employees based on their designation.
  • Accessibility: A manager might be able to check real time data and reports while he is on the move or working from home. This has proved especially helpful for a large number of enterprises during the pandemic. They had to manage a large workforce working remotely and in such a time cloud based MIS can be the solution to several problems. With a cloud based MIS, the data is always within access and apart from the login credentials, you will only need internet connection. Managers can even check and update the MIS from their smartphones.

What is a Marketing Information System or MKIS?

The Marketing Information System or MKIS is designed to address the information needs of marketing managers. Its role is to assess the needs of the marketing managers and then offer the framework for collecting and processing the information as well as distributing it to the end users. Apart from marketing needs analysis, the other functions that an MKIS supports marketing managers with include planning, implementation and control. 

Where does the data and information (the raw material for MKIS) come from?

The data and information for the MKIS comes from several sources. This information is retrieved from internal records, marketing intelligence activities, marketing research as well as marketing decisions support analysis. 

What are the various parts of the MKIS?

The various parts of the MKIS include – 

  • An accounting information system 
  • Marketing, sales and customer services – This part of the MIS, apart from sales force automation, also saves the company labor hours and expenses related to telephone calls. It also captures customer data and the response time to customer queries.
  • Market research and intelligence information system.  – This part of the MIS includes market research, customer research and competitor intelligence. Competitor intelligence includes the information on the product line of the competitors as well as their operating strengths and weaknesses apart from other crucial information like customer service level and customer policies of the competitors and any new product in the competitors’ pipeline.

What is a Manufacturing Information System?

Enterprises generate a vast amount of data daily in their manufacturing operations that need to be processed so that important decisions are made faster, and the manufacturing flow remains free from bottlenecks. To manage the massive amounts of data, organizations need a set of tools that can help them manage the manufacturing/production data throughout the enterprise. Manufacturing is not a single area. It is instead a multidisciplinary area that includes several functions from product engineering to facility design and scheduling as well as fabrications and quality control management. Each of these functions can see dramatic improvements through the use of an information system. It is also why Manufacturing Information Systems seem to be complicated since they address several interacting domains. The Manufacturing information systems provide accurate and timely data that can be used in manufacturing to make critical decisions. 

A manufacturing information system can help businesses sustain and grow their profitability. However, the critical thing is the design of the MIS since a poorly designed MIS cannot sufficiently address the data and information related needs of the managers.

What is an Accounting Information System?

An ‘accounting information system’ is a part of the broader organizational information system. The organizational information system processes both quantitative and qualitative data. An accounting information system, on the other hand, processes only quantitative data. However, the accounting information system must be well integrated with the broader information system to serve its goals efficiently. When the two are blended well, they work together efficiently and effectively.

The accounting information system processes quantitative data and delivers the necessary information or reports to carry out the essential accounting related work. It offers accurate and timely information to the end-user. Even those who are not so familiar with core accounting and financial reporting can use these reports to carry out their work. These information systems can process a large volume of quantitative data. Data processing includes four major tasks – gathering, storage, and manipulation of data as well as report preparation.

Types of Information Systems

MIS is a discipline that is continuously evolving. It is without a definite boundary. However, there are still some top classifications of Information Systems that include the following:

  • Transaction Processing System (TPS) – Transaction processing refers to the automation of the primary and routine processes carried out inside an organization. For example, in a retail store that carries thousands of different products, customers come and buy as well as pay for products daily. The staff continuously fills the shelves with products. They order new shipments when stocks run low. In this way, several essential things need tracking to operate the retail business successfully. A transaction processing system captures and processes the data that is required to keep track of the daily operations of the organization.
  • Management Information System – Management Information System uses input from the TPS and processes the data to convert it into actionable information or reports.  The MIS generated reports can be used for various purposes, including operational control, short term, and long term or strategic planning, as well as management control and other types of managerial problem-solving. The use of MIS can help several business functions with their tasks, including marketing, accounting, finance, human resources management, manufacturing, etc.
  • Decision Support System –  As the name implies, a DSS or decision support system assists with managerial decision making. DSS mainly serves the top management and managers at the strategic planning level. The DSS is based on a database that combines internal corporate data with information collected from the external sources. 
  • Executive Support system – Executive Support systems are for use by the top-level executives of an organization. These information systems provide support for nonprogrammatic decisions by the senior executives. They need quick access to useful and summarized reports based on data and information from all the levels within an organization. Apart from reports, some ESS also provides analytical tools that executives can use to predict the outcome of particular actions over a given period. Companies also offer ESS that has extra analytical tools suited to the needs of specific industries.
  • Office Automation System – In general, the office automation tool refers to the application of IT to standard office functions. An office automation system allows the movement of data from one system to another without any human intervention or chances of inaccuracies and mistakes. The tools included in an office automation system allows the managers to collect, manage, and analyze data and information related to everyday tasks securely. Office automation systems offer a broad range of benefits for businesses. Apart from reducing the manual efforts required for the collection and analysis of data or information, they also store large volumes of data in very little space. Other significant benefits include the streamlining of daily tasks as well as faster information retrieval.
  • Business Expert System – A business expert system is a knowledge-based information system that utilizes the power of AI to make tasks easier inside an organization by acting as an expert on specific subject matters. It includes a database of knowledge related to a particular complex area of application. Using that database, it serves as an expert in that specific subject matter. These business expert systems (BES) are interactive and can answer difficult questions whose answers can be complicated for the managers to find. In this way, the business expert systems also support managerial decision making by providing expert advice in problematic areas. When asked a question, a business expert system searches its knowledge base to find related facts and rules and, based on that, answers the problem while also offering the reasoning behind its analysis.

What can be some problems with the implementation of an MIS?

While MIS is highly useful for managers and the entire organization, there can also be several hurdles to its implementation, including resistance from the staff as happens in most cases of technological change. The limitations are generally the same as in the case of most IT systems. An MIS changes several things inside an organization, from organizational culture to the power structure and the skills requirements as well as style of work. Problems may erupt because MIS implementation may face resistance from employees. The top management needs to be careful both at the time of the creation and implementation of the MIS. Some of the significant factors that may cause resistance against implementing an MIS include but are not limited to:

  • The degree of change that an MIS brings with itself. Any significant change that may force departments and staff to change their way of working is bound to be challenged and will meet resistance. These things must be anticipated at the time of the design. Apart from designing the MIS, there may also be a need to do some business process reengineering. The MIS will require some alterations to be made to the business processes so it can suit the normal operational flow and facilitate smooth workflow. If the management is aware of these factors in advance, it will be able to ready the workforce for the impending changes.
  • The lack of a supportive culture for IT can also become a hurdle to the implementation of MIS. Some organizations that lack an environment and culture of IT may face stiff resistance while trying to undertake a technological change. In such an environment where employees are untrained in making data-based decisions, MIS implementation may become difficult. Moreover, apart from implementing MIS, it may also be essential to institute a cultural change that will support its implementation.
  • The degree of staff involvement in MIS creation and implementation also decides how much support it will gain from the employees. When creating or implementing an MIS, it is good to let the staff participate. The higher their level of participation, the higher will be the acceptance for the MIS, and the resistance will be lower. Moreover, if the employees are not made a part of the process, a sudden change will make them feel like being excluded, and this will lead to higher resistance.
  • The MIS must not wholly take over the informal communication system because that will make people feel like they are losing control and authority, and this will make the resistance grow.

These are some of the main reasons that there can be stiff resistance to the implementation of an MIS. While it is designed to serve the purpose of information support for managerial decision making, it affects the way of work. It may require some additional changes to fit well with the organizational structure and culture. Apart from some basic employee training that may be essential for using the MIS, the management must also convince and persuade the employees regarding the benefits of the MIS and how it is going to raise their ability and productivity.