Management information system [mis]:

INTRODUCTION:A management information system (MIS) is a system that provides information needed to manage organizations effectively. Management information systems are regarded to be a subset of the overall internal controls procedures in a business, which cover the application of people, documents, technologies, and procedures used by management accountants to solve business problems such as costing a product, service or a business-wide strategy. Management information systems are distinct from regular information systems in that they are used to analyse other information systems applied in operational activities in the organization. Academically, the term is commonly used to refer to the group of information management methods tied to the automation or support of human decision making, e.g. Decision Support Systems, Expert systems, and Executive information systems.Definition: Management Information Systems (MIS) is the term given to the discipline focused on the integration of computer systems with the aims and objectives on an organisation. The development and management of information technology tools assists executives and the general workforce in performing any tasks related to the processing of information. MIS and business systems are especially useful in the collation of business data and the production of reports to be used as tools for decision making.

ADVANTAGES OF MIS:

An MIS provides the following advantages.

1. It Facilitates planning: MIS improves the quality of plants by providing relevant information for sound decision making. Due to increase in the size and complexity of organizations, managers have lost personal contact with the scene of operations.

2. In Minimizes information overload: MIS change the larger amount of data in to a summarized form and there by avoids the confusion which may arise when managers are flooded with detailed facts.

3. MIS Encourages Decentralization: Decentralization of authority is possibly when there is a system for monitoring operations at lower levels. MIS is successfully used for measuring performance and making necessary change in the organizational plans and procedures.

4. It brings Coordination: MIS facilities integration of specialized activities by keeping each department aware of the problem and requirements of other departments. It connects all decision centres in the organization.

5. It makes control easier: MIS serves as a link between managerial planning and control. It improves the ability of management to evaluate and improve performance. The used computers has increased the data processing and storage capabilities and reduced the cost.

6. MIS assembles, process, stores, Retrieves, evaluates and disseminates the information.

7. Management oriented: better management of resources reducing the cost of production.

8. Efficiency: due to faster processing technology management can see the information in their perspective and take different view of the business.

DISADVANTAGES OF MIS:Depending on organization deployment, usage and extraneous factors, some disadvantages related to Management Information Systems can come to the fore. Allocation of budgets for MIS upgrades, modifications and other revisions can be quite tricky at times. If budgets are not allocated uniformly or as per immediate requirements, key functionalities might get affected and benefits might not be realized consistently. Integration issues with legacy systems can affect the quality of output and vital business intelligence reports.

1. Constant Monitoring Issues: Change in management, exits or departures of department managers and other senior executives have a broad effect on the working and monitoring of certain organization practices including MIS systems. Since MIS is a critical component of an organization's risk management strategy and allied systems, constant monitoring is necessary to ensure its effectiveness. Quality of inputs into MIS needs to be monitored; otherwise consistency in the quality of data and information generated gets affected. Managers are not able to direct business, operational and decision-making activities with the requisite flexibility.

2. Unemployment: While information technology may have streamlined the business process it has also crated job redundancies, downsizing and outsourcing. This means that a lot of lower and middle level jobs have been done away with causing more people to become unemployed.

3. Privacy: Though information technology may have made communication quicker, easier and more convenient, it has also bought along privacy issues. From cell phone signal interceptions to email hacking, people are now worried about their once private information becoming public knowledge.

4. Lack of job security: Industry experts believe that the internet has made job security a big issue as since technology keeps on changing with each day. This means that one has to be in a constant learning mode, if he or she wishes for their job to be secure.

5. Dominant culture: While information technology may have made the world a global village, it has also contributed to one culture dominating another weaker one. For example it is now argued that US influences how most young teenagers all over the world now act, dress and behave. Languages too have become overshadowed, with English becoming the primary mode of communication for business and everything else.

APPLICATIONS OF MIS:With computers being as ubiquitous as they are today, there's hardly any large business that does not rely extensively on their IT systems. However, there are several specific fields in which MIS has become invaluable.

Strategy Support :While computers cannot create business strategies by themselves they can assist management in understanding the effects of their strategies, and help enable effective decision-making. MIS systems can be used to transform data into information useful for decision making. Computers can provide financial statements and performance reports to assist in the planning, monitoring and implementation of strategy. MIS systems provide a valuable function in that they can collate into coherent reports unmanageable volumes of data that would otherwise be broadly useless to decision makers. By studying these reports decision-makers can identify patterns and trends that would have remained unseen if the raw data were consulted manually. MIS systems can also use these raw data to run simulations hypothetical scenarios that answer a range of what if questions regarding alterations in strategy. For instance, MIS systems can provide predictions about the effect on sales that an alteration in price would have on a product. These Decision Support Systems (DSS) enable more informed decision making within an enterprise than would be possible without MIS systems. Data Processing :Not only do MIS systems allow for the collation of vast amounts of business data, but they also provide a valuable time saving benefit to the workforce. Where in the past business information had to be manually processed for filing and analysis it can now be entered quickly and easily onto a computer by a data processor, allowing for faster decision making and quicker reflexes for the enterprise as a whole.

Management by Objectives :While MIS systems are extremely useful in generating statistical reports and data analysis they can also be of use as a Management by Objectives (MBO) tool. MBO is a management process by which managers and subordinates agree upon a series of objectives for the subordinate to attempt to achieve within a set time frame. Objectives are set using the SMART ratio: that is, objectives should be Specific, Measurable, Agreed, Realistic and Time-Specific. The aim of these objectives is to provide a set of key performance indicators by which an enterprise can judge the performance of an employee or project. The success of any MBO objective depends upon the continuous tracking of progress. In tracking this performance it can be extremely useful to make use of an MIS system. Since all SMART objectives are by definition measurable they can be tracked through the generation of management reports to be analysed by decision-makers.

ENTERPRISE RESOURCE PLANING SYSTEM [ERP]:

INTRODUCTION:Enterprise resource planning (ERP) integrates internal and external management information across an entire organization, embracing finance, accounting, manufacturing, sales and service, etc. ERP systems automate this activity with an integrated software application. Its purpose is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.ERP systems can run on a variety of hardware and network configurations, typically employing a database to store data.ERP systems typically include the following characteristics: An integrated system that operates in (next to) real time, without relying on periodic updates. A common database which supports all applications. A consistent look and feel throughout each module. Installation of the system without elaborate application/data integration by the Information Technology (IT) department.Enterprise Resource Planning or ERP is actually a process or approach which attempts to consolidate all of a company's departments and functions into a single computer system that services each department's specific needs. It is, in a sense, a convergence of people, hardware and software into an efficient production, service and delivery system that creates profit for the company.The most often-cited example of an ERP software is customer ordering and delivery where a customer's order moves smoothly from Sales, where the 'deal' is consummated, to Inventory and Warehousing, which retrieves and packages the order for delivery, to Finance, where invoicing, billing and payments are handled, and on to Manufacturing, where replacement of the bought-and-paid-for product is done.

ADVANTAGES OF ERP:The fundamental advantage of ERP is that integrating the myriad processes by which businesses operate saves time and expense. Decisions can be quicker and with fewer errors. Data becomes visible across the organization. Tasks that benefit from this integration include:

1. Sales forecasting, this allows inventory optimization.2. Order tracking, from acceptance through fulfilment.3. Revenue tracking, from invoice through cash receipt.4. Matching purchase orders (what was ordered), inventory receipts (what arrived), and costing (what the vendor invoiced).5. ERP systems centralize business data.6. Eliminates synchronizing changes between multiple systemsconsolidation of finance, marketing and sales, human resource, and manufacturing applications7. Enables standard product naming/coding.8. Provides comprehensive enterprise view. Makes real time to make proper decisions.9. Protects sensitive data by consolidating multiple security systems into a single structure. DISADVANTAGES OF ERP:

1. Customization is problematic.2. Reengineering business processes to fit the ERP system may damage competitiveness and/or divert focus from other critical activities3. ERP can cost more than less integrated and/or less comprehensive solutions.4. High switching costs increase vendor negotiating power, support, maintenance and upgrade expenses.5. Overcoming resistance to sharing sensitive information between departments can divert management attention.6. Integration of truly independent businesses can create unnecessary dependencies.7. Extensive training requirements take resources from daily operations.

APPLICATION OF ERP:

Enterprise applications suites, commonly known as enterprise resource planning (ERP) systems, represent the transactional backbone for most enterprises and comprise a variety of applications for finance and administration as well as industry-specific applications for business operations. Comprehensive ERP suites from leading vendors now typically span customer relationship management (CRM), supply chain management (SCM), analytics, and other applications traditionally sold as best-of-breed products. As vendors and enterprises enter the next generation of applications that support new deployment options like software-as-a-service (SaaS), deliver on service-oriented architecture (SOA) principles, and support business processes via Web services, Forrester's ERP research provides the knowledge of the basics, best practices, trends, strategic advice, and vendor and product comparisons that firms need in order to navigate the complexities across the software ownership life cycle.An ERP system would qualify as the best model for enterprise wide solution architecture, if it chains all the below organizational processes together with a central database repository and a fused computing platform.

Manufacturing:Engineering, resource & capacity planning, material planning, workflow management, shop floor management, quality control, bills of material, manufacturing process, etc.

Financials:Accounts payable, accounts receivable, fixed assets, general ledger, cash management, and billing (contract/service)

Human Resource:Recruitment, benefits, compensations, training, payroll, time and attendance, labour rules, people management

Supply Chain Management:Inventory management, supply chain planning, supplier scheduling, claim processing, sales order administration, procurement planning, transportation and distribution

Projects:Costing, billing, activity management, time and expenseCustomer Relationship ManagementSales and marketing, service, commissions, customer contact and after sales support

Data Warehouse:Generally, this is an information storehouse that can be accessed by organizations, customers, suppliers and employees for their learning and orientation

ERP Systems Improve Productivity, Speed and Performance:Prior to evolution of the ERP model, each department in an enterprise had their own isolated software application which did not interface with any other system. Such isolated framework could not synchronize the inter-department processes and hence hampered the productivity, speed and performance of the overall organization. These led to issues such as incompatible exchange standards, lack of synchronization, incomplete understanding of the enterprise functioning, unproductive decisions and many more.

For example: The financials could not coordinate with the procurement team to plan out purchases as per the availability of money.

Hence, deploying a comprehensive ERP system across an organization leads to performance increase, workflow synchronization, standardized information exchange formats, complete overview of the enterprise functioning, global decision optimization, speed enhancement and much more.