Chapter 2: Management Information Systems PDF

Chapter 2 How is a Management Information System Useful in Companies? Planning and Control: - MIS improves planning quality by providing relevant decision- making information. - It links planning with control. - It helps management assess and boost performance. MIS Minimizes Information Overload: -...

Chapter 2 How is a Management Information System Useful in Companies? Planning and Control: - MIS improves planning quality by providing relevant decision- making information. - It links planning with control. - It helps management assess and boost performance. MIS Minimizes Information Overload: - MIS turns large data into summaries. - This avoids confusion from overwhelming details. MIS Encourages Decentralization: - Decentralization becomes possible as MIS tracks lower-level operations. - It helps measure performance and make adjustments to company plans. Costs: - Hiring a consultant helps define core requirements for strategic planning and project management. - For MIS to succeed, it should focus on products, services, customers, costs, opportunities, and risk. MIS Brings Coordination: - MIS integrates different departments by making each aware of others' needs and issues. 1 - It connects all decision-making centers in the company. - MIS Assembles, Processes, Stores, Retrieves, Evaluates, and Disseminates Information Impact of the Management Information System: - With strong MIS support, managing marketing, finance, production, and HR becomes more efficient. - MIS starts by defining data entities and their details, specifically for generating useful information. - It requires systemizing business operations to create an effective system design. - This leads to a streamlined setup, even though it may complicate the system design process. - MIS enhances business administration by enforcing discipline, as everyone needs to follow established systems and procedures. - This process adds a high level of professionalism to business operations. - Since MIS goals align with the company’s goals, it unifies the organization towards its objectives by delivering relevant information to employees. Benefits of the Management Information System: - Data is easy to access and analyze without needing extra time for processing. - Decisions can be made faster, with confidence that the data is accurate and timely. - Information can be organized into meaningful categories that support profitable operations.- MIS brings cost savings, time efficiency, higher productivity, and chances to improve processes. 2 Financial Management Information Systems: - Provides financial information to executives and other users. - Key Financial MIS Subsystems and Outputs: - Profit/loss and cost systems for profit and revenue centers. - Auditing, both internal and external. - Managing and utilizing company funds. Manufacturing Management Information Systems: - Manufacturing MIS Subsystems and Outputs: Track and manage the flow of materials, products, and services in the organization. - Design and Engineering: Includes CAD systems for product design. - Master Production Scheduling and Inventory Control: Uses methods like EOQ, MRP, and JIT for planning. - Process Control: Uses techniques like CAM, CIM, and FMS to manage production. - Quality Control and Testing Marketing Management Information Systems: Supports managerial activities in: - Product development - Distribution - Pricing decisions - Promotional effectiveness 3 Subsystems: - Marketing research - Product development - Promotion and advertising - Product pricing - Sales analysis Human Resource Management Information: - Concerned with activities related to employees and potential employees. Subsystems: - Human resource planning - Personnel selection and recruiting - Training and skills inventory - Scheduling and job placement - Wage and salary administration - Outplacement Other Management Information Systems: - Accounting MIS: Provides aggregate information on: - Accounts Payable - Accounts Receivable - Payroll, and many other applications - Geographic Information System (GIS): 4 - Capable of assembling - Storing - Manipulating - Displaying Geographic Information 5