Page 21 - DCAP205_DCAP409_ANALYSIS_AND_DESIGN_OF_INFORMATION_SYSTEMS

Unit 1: Introduction to Information System Development

Notes
Figure 1.5: Types of Information Systems Supporting Different Levels of Management

Levels in
organisation
Executive
Support Strategic
Systems
Management
Information Systems Management
Decision Support Systems

Office Automation System Knowledge
Transaction Processing Systems Operational

1.4.2 Management Information System (MIS)

This system is designed to serve the functions of planning, controlling and decision-making at
the management level of an organization. The system at management level support monitoring,
controlling and decision-making activities of middle level managers.
While computers were ideal for routine transaction processing, managers soon realized that the
computers’ capability of performing rapid calculations and data comparisons could produce
meaningful information for management. Management information systems thus evolved out
of transaction processing systems. A Management Information System, or MIS (pronounced
em-eye-ess), is an information system that generates accurate, timely and organized information
so managers and other users can make decisions, solve problems, supervise activities, and track
progress. Because it generates reports on a regular basis, a management information system
sometimes is called a Management Reporting System (MRS).
Management information systems often are integrated with transaction processing systems.

Example: To process a sales order, the transaction processing system records the sale,
updates the customer’s account balance, and makes a deduction from inventory. Using this
information, the related management information system can produce reports that recap daily
sales activities; list customers with past due account balances; graph slow or fast selling products;
and highlight inventory items that need reordering.
An MIS generates three basic types of information: detailed, summary and exception. Detailed
information typically confirms transaction processing activities. A Detailed Order Report is an
instance of a detail report. Summary information consolidates data into a format that an individual
can review quickly and easily. To help synopsize information, a summary report typically contains
totals, tables, or graphs. An Inventory Summary Report is an instance of a summary report.
Exception information filters data to report information that is outside of a normal condition.
These conditions, called the exception criteria, define the range of what is considered normal
activity or status.

Example: An example of an exception report is an Inventory Exception Report that
notifies the purchasing department of items it needs to reorder.
Exception reports help managers save time because they do not have to search through a detailed
report for exceptions. Instead, an exception report brings exceptions to the manager’s attention
in an easily identifiable form. Exception reports thus help them focus on situations that require
immediate decisions or actions.

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