“Management information system is essential for creating competitive firms, managing global corporations, and providing useful products and services to customers.” (Laudon, 2002,P1) It provides information figure of reports and displays to managers. For example, sales managers may use their computer workstations to get sales results of their products and to access weekly sales analysis reports, and then evaluate sales made by each salesperson. “Management information systems arose in the 1970s to focus on computer-based information systems aimed at managers.” (Laudon, 2002, P15). Because of the growths of the Internet, globalisations of trade, and the rise of information economies, have to improve the role of information systems in business and management.
And then it needs pays attention to organisation management information that issues raised by sociology, economics, environment and psychology. “An organization is a stable, formal social structure that takes resources from the environment and processes them to produce outputs.” (Laudon, 2002,P87) This essay will be evaluating the contribution of Management Information System to Organisations. Like as What relationship between information and manager’s job; computer network’s importance for management information development; different types of management information systems to use differences and how it is impact and limitation of information systems.
Firstly, before organisation Management Information need to understand it that have four factors determine the usefulness of information a manager: quality, timeliness, completeness, and relevance (Gareth, 2000,P613)
“Accuracy and reliability determine the quality of information.” (Gareth, 2000,P613) tell us higher quality of information need have greater accuracy and reliability. The greater accuracy and reliability’s information will bring correct decision for manager. For example, accounting informstions, ” information as accuracy refers to the extent to which information effectively represents a situation as it really is, the accuracy of each source of data used varied widely.”((Volking, 1993, P8)
The source where accuracy posed the greatest problem was the marketing database.So I think usefulness informations need have accuracy and reliability, accuracy and reliability determine the quality of information.
“Information that is timely is available when it is needed for managerial action, not after the decision has been made” (Gareth, 2000,P614) In today’s speedily changing world and technology ‘s developing, lead to information changing frequently. Real-time Information is reflecting current conditions. (Gareth, 2000,P614) For example, productions’ price changing frequently in marketing because manager wants to make profit in competition’s marketing. So manager should be pay attention to information’s changing. Catch Real-time information is very importance. Look at timeliness in accounting
“Timeliness: accounting information should be made available to external decision-makers before it loses its capacity to influence decisions.” (Dyckman, 1992, P44) Like the news of the world, old financial information never carries the same impact fresh information carries. Otherwise lack of timeliness reduces relevance.
“Information that is complete gives managers all the information they need to exercise control, achieve coordination, or make an effective decision.” (Gareth, 2000,P615) information’s completive will provided good help to manager to decision. When you set up a new business, look at complete information is importance. Such as, how is this productions sold, how long can make profit and how much capital need put in this company at first time. Also information in accounting system also need pay attenation to information’s completetive.
“Information that is relevant is useful and suits a manager’s particular needs and circumstances” (Gareth, 2000,P615) It can make a difference in a user’s decision. Relevance refers to the capacity of accounting information to make different to external decision-makers who use financial reports. They use accounting information with either or both of two viewpoints in mind:
Forecasting what the economic future is likely to hold.
Confirming the accuracy of past forecasts.
Stated more technically, relevant accounting information help users to make predictions about future events, to confirm or correct prior expectations, and to evaluate current conditions. (Dyckman, 1992, P43)
In my opinion, relevant is most importance, because if the data are not relevant to the task at hand, manager will be make mistake by these wrong information, and west time in wrong decisions. And then will bring some problem for this company’ s operation.
Information decision, control and coordination
Secondly, information technology’s development is importance for management information development. Because the growths of the Internet, globalisations of trade, and the rise of information economies, it have to improve the role of information systems in business and management. Software is the detailed instructions that control the operation of a computer system. Without software, computer hardware could not perform the tasks we associate with computers. The functions of software are to (1) manage the computer resources of the organisation (2) provide tools for human beings to take advantage of these resources, and (3) act as an intermediary between organisations and stored information. Selecting suitable software for the organisation is a key management decision. (Laudon, 2002,P172)
Thirdly, different types of management information systems to use differences: a transaction-processing system is a system designed to handle large volumes of routine, recurring transactions. (Gareth, 2000,P625) For example, managers use transaction- processing system to record sale of items and path inventory levels, employee record keeping, and payroll.
“A management information system that gathers, organize, and summarizes comprehensive data in a from that managers can use in their nonroutine coordinating, controlling, and decision-making task.(Gareth, 2000,P626) Operational Systems are concerned with transaction handling and the day-to-day operation of the organisation, usually for a particular department within the organisation. Data are entered and stored in a file format, and are updated regularly during routine processing. Example, Producing invoices and monthly reports for operational-level managers, and fortnightly payroll cheques.
The major disadvantage of this system is that they are inflexible and so not able to be adapted easily to do new tasks, or expected tasks earlier than usual. They also do not support any decision-making advice ability for tactical and strategic-level managers.
Most companies today have gone beyond this system. (Long, 1994,P365-397)
Decision support systems give direct computer support to managers during the decision-making process. For example advertising managers may use an electronic database packs up to do what, if analysis as they test the impact of other advertising budgets on the forecasted sales of new products. (O’Brien, 1997,P31) A Decision Support System is an interactive information system that rely on integrated user-friendly hardware and software designed to assist mangers make decisions related to the efficient and profitable running of the business.
Expert systems can provide expert advice for operational chores like equipment diagnostics, or managerial decisions such as loan portfolio management. (O’Brien, 1997,P32) Expert systems have been developed for subjects such as medical diagnosis, oil exploration, financial planning, taxation return preparation, chemical analysis, surgery, weather prediction, computer repair, nuclear power plant operation, newspaper layout, interpreting government regulation, and troubleshooting computer systems configurations (eg. MS Help). (Long, 1994,P365-397)
Finally, management information systems also have some limitations and some technology impact its development. The advance in management information system and technology are having important effects on managers and organisations. (Gareth, 2000,P629) One of the most important of these involves the subjectivity of the scoring technique. Clearly establishing the extent to which a data attribute is inherent in any one data source is highly judgemental. Likewise, establishing weightings for each attribute is also a highly subjective process. These tasks are therefore very much subject to the perception of the individuals who carry them out. This problem could be partly overcome by increasing the objectivity with which such estimates are made.
Conclusion, Management information system is an information system that managers’ plan and design to provide themselves with the specific information they need. (Gareth, 2000,P615)This essay has Evaluated the contribution of Management Information System to Organisations. Including about Like as What factors determine the usefulness of information a manager; computer network’s importance for management information development; different types of management information systems to use differences and how it is impact and limitation of information systems. From this essay, we can know MIS have some advantages for our used, however this tool is not perfect, also have limitations for it. So Managing a good company , need understand it first.
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