Answer
Effective management information systems are needed by all business organization because of the increased complexity and rate of change of today’s business environment. For example, marketing manager need information about sales performance and trends, financial manager returns, production managers needs information for analyzing resources requirement and worker productivity and personnel manager requires information concerning employee compensation and professional development. Thus, effective management information systems must be developed to provide modern managers with the specific marketing, financial, production and personnel information products they require to support their decision making responsibilities.
Management informationsystems have changed the dynamics of running businesses efficiently. Decentralization is one of the biggest advantages; it allows monitoring of operations at low levels and frees up resources for departmental managers to devote time to strategic activities. Coordination of specialized projects and activities is much better and decision makers in the organization are aware of issues and problems in all departments. Another advantage of MIS is that it minimizes information overload, which can be quite common with conventional businesses in the modern era.
An MIS provides the following advantages.
- It Aids in Decision Making: The purpose of MIS is to generate synthesized and processed information from computerized/automated and certain manual systems. Information distribution to all levels of corporate managers, professionals and key executives becomes quite seamless with streamlined MIS. Managers are able to make quick, timely and informed decisions. Top management and board members can take strategic decisions, plan future growth and business expansion activities based on the data and information generated by MIS.
- 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.
- It Minimizes Information Overload: MIS change the larger amount of data in to summarized form and thereby avoids the confusion which may arise when managers are flooded with detailed facts.
- 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.
- 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 centers in the organization.
- It Facilitates Better Planning and Control: MIS has to be designed and managed in such way that it aggregates information, monitors the company’s activities and operations and enhances communication and collaboration among employees. This ensures better planning for all activities and better ways to measure performance, manage resources and facilitate compliance with industry and government regulations. Control helps in forecasting, preparing accurate budgets and providing the tools and vital information to employees, top management and business partners.
- MIS assembles, process, stores, retrieves, evaluates and disseminates the information efficiently and effectively.
