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Home > Management information systems

An information system is comprised of all the components that collect, manipulate, and disseminate data or information. It usually includes hardware, software, people, communications systems, and the data itself. The activities involved include inputing data, processing of data into information, storage of data and information, and the production of outputs such as management reports.

The area of study should not be confused with Computer Science which is more theoretical and mathematical in nature or with Computer Engineering which is more engineering.

The study of Information Systems is usually a commerce and business administration discipline, and frequently involves software development, but also distinguishes itself by concentrating on the integration of computer systems with the aims of the organization.

In business, information systems support business processes and operations, support decision making, and support competitive strategies.

1 The functional support role

The business processes and operations support function is the most basic. It involves collecting, recording, storing, and basic processing of data. Information systems support business processes and operations by:

• recording and storing sales data, purchase data, investment data, payroll data and other accounting records
• processing these accounting records into income statements, balance sheets, ledgers, management reports, and other forms of financial information
• recording and storing inventory data, work in process data, equipment repair and maintenance data, supply chain data, and other production/operations records
• processing these operations records into production schedules, production controllers, inventory systems, and production monitoring systems
• recording and storing personnel data, salary data, employment histories, and other human resources records
• processing these human resources records into employee expense reports, and performance based reports
• recording and storing market data, customer profiles, customer purchase histories, marketing research data, advertising data, and other marketing records
• processing these marketing records into advertising elasticity reports, marketing plans, and sales activity reports
• recording and storing business intelligence data, competitor analysis data, industry data, corporate objectives, and other strategic management records
• processing these strategic management records into industry trends reports, market share reports, mission statements, and portfolio models
• use of all the above to implement, control, and monitor plans, strategies, tactics, new products, new business models or new business ventures

2 The decision support role

The business decision making support function goes one step further. It is an integral part of making decisions. It allows users to ask “What if . . . ?” questions : What if we increase the price by 5%? ; What if we increase price by 10%? ; What if we decrease price by 5%? ; What if we increase price by 10% now, then decrease it by 5% in three months? It also allows users to deal with contingencies : If Inflation increases by 5% (instead of 2% as we are assuming), then what do we do? What do we do if we are faced with a strike or a new competitive threat?

The most basic and most versatile business decision making tool is the spreadsheet, but spreadsheets are not user friendly. More sophisticated programs often seamlessly incorporate statistical decision making tools like sensitivity analysis, Monte Carlo analysis, risk analysis, break even analysis and Bayesian analysis. If, for example, you are using the information system to decide about a new product introduction, the program should incorporate tools like logit analysis, B.C.G. Analysis, conjoint analysisConjoint analysis also called multiattribute compositional models, is a statistical technique that originated in mathematical psychology. Today it is used in many of the social sciences and applied sciences including marketing, product management, and ope, contribution margin analysisContribution margin analysis is a technique used in brand marketing and product management to help a company decide what product(s) to add to its product portfolio. The manager asks what will happen to profits if a new product is added or an existing prod, multi dimensional scaling, G.E. Multi Factoral analysis, factor analysisFactor analysis is a statistical technique that originated in mathematical psychology. It is used in the social sciences and in marketing, product management, operations research, and other applied sciences that deal with large quantities of data. The obj, cluster analysis, discriminant analysis, Quality Function Deployment, preference regressions, and preference-rank translations.

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ManagementManagement (from Old French, "menagement" "the art of conducting, directing", from Latin "manum agere" "lead by the hand") characterises the process of leading and directing all or part of an organization, often a business, through the deployment and mani Management scienceManagement Science (MS) is the discipline of using mathematics, and other analytical methods, to help make better business decisions. While often considered synonymous with Operations Research (OR), MS is differentiated by being generally thought to have Management accountingManagement accounting is concerned with the provision and use of accounting information to managers within organizations, to facilitate the managers in their decision making and management control functions. Unlike financial accountancy information (which Management systemA management system is the framework of processes and procedures used to ensure that an organisation can fulfil all tasks required to achieve its objectives. See also: TQM. Management developmentIn organizational development (OD), the effectiveness of management is recognized as one of the determinant's of organizational success. Therefore, investment in management development can have a direct economic benefit to the organization. Challenges Bad Management information systemsInformation Systems also Management Information Systems (MIS is the formal study of the information systems within an organization. WordNet described an information system as a system consisting of the network of all communication channels used within an Management consulting Management effectiveness Management by objectives Management process Management systems for road safety Management agent Management Science Management information base Management buyout