Lesson 9:
Types of information system
Introduction
 An MIS is a decision support system in which the form of input query and response is
predetermined.
 It is often summarised from an information system. It is used where management want to
ask the same question frequently, though perhaps about different subjects. Here are two
typical questions:
 List the top ten stores for sales this month, by product type, together with last month’s data and
the percentage change. (This would help management review their flagship stores.)
 For a particular store, list this month’s average sales by day of week and by product type. (This
would help store management plan the staff needed at different times. It could also help them
understand their sales – for example, it might show that groceries sell best on Fridays; wines, beers
and spirits on Saturdays; and home improvement items on Sundays.)
 There are many different types of information system. This presentation shall explain these.
Management Information System (MIS)
 A management information system (MIS) is a set of systems and procedures that gather information
from a range of sources, compile it and present it in a readable format.
 Managers use an MIS to create reports that provide them with a detailed overview of all the
information they need to make decisions ranging from daily tasks to top-level strategy.
 The main purpose of a MIS is to make managers' decision-making more efficient and productive. By
pooling information from a range of sources into a single database and presenting the information
in a logical format, an MIS can give managers everything they need to make highly informed
decisions and perform in-depth analysis of business issues.
 An MIS can collect nearly any type of information needed. They can show financial data such as
revenue and expenses and attribute them to specific departments or groups. Performance
indicators such as the timeliness of projects or the quality of products coming off an assembly line
can help managers pinpoint areas of needed improvement. Staff can manage schedules for work
shifts, incoming deliveries and outgoing shipments from any place linked to the MIS.
 A management information system can help collaboration and communication as well. Employees
can edit and share documents and communicate information on anticipated developments and
warnings across the organisation.
Marketing Analysis and Competitor analysis
 Many of the fist examples of information systems were in marketing and sales.
 Sales performance: If a business could identify where and why its sales were increasing,
then it could apply those conditions elsewhere with the same effect. For example, a retail
chain might run an advertising campaign or a reduced price offer in one shop or a small
number of shops. An information system could identify how successful
this was. A chain of shops or hotels could have a programme of refurbishing their
properties. An information system could show how successful this programme was in
increasing business.
 Competitors: Typical competitive activities include selling competing products, opening
competing stores and reducing prices. As competitors introduce these changes, an
information system can show what effect these changes have. A business can also make
similar changes specifically to compete and the system could identify the effect of these
changes.
Human Resources (HR)
 Human resources departments often produce a lot of analyses and so may have an
information system to help them.
 Staffing: One of the goals of an organisation may be to have the right number of people
doing the right work with the right skills. An information system can identify staff and skill
shortages and excesses. It can also identify staff turnover, age, gender and experience
profiles.
 Professional development: This is an extension from staffing – it covers the organisation’s
needs, staff training, and skills and experience for professional development. Analysis of
this can identify suitable candidates for jobs and potential training opportunities for staff.
Financial Information System
 Once a business has an information system to help manage income or revenue, the next area
to address is often expenditure or costs.
 Financial costs: Spreadsheets can be used to help manage regular costs. However, information
systems will more easily find trends and unusual patterns. Typical questions they could answer
are:
 Do costs regularly surge or drop at the start or end of the year?
 Which over-spends are gradual?
 Which are caused by one large unexpected or excessive item?
 Investment returns: A bank or investment company wants to understand its portfolio of
investments. Some investments are high risk but potentially high return. Some are low risk but
with low return. Some offer no return at all, but increase the capital value of the investment. An
information system will help identify the investments that fall into each category.
Customer Relationship Management (CRM)
 CRM is an type of information system that manages a company's interactions with current
and future customers by organizing and co-ordinating sales and marketing, providing
better customer services along with technical support.
 A CRM is used:
 To keep track of all present and future customers.
 To identify and target the best customers.
 To let the customers know about the existing new products and services.
 To provide real-time and personalized services based on the needs, wants and habits of the
existing customers.
 To provide superior service and consistent customer experience.
 To implement a feed-back system.
Decision Support System
 All information systems support decision making, but decision support systems are expressly
designed for this purpose.
 A decision support system (DSS) is a computer program application that analyses business data
and presents it so that users can make business decisions more easily.
 The primary objective of DSS’s s is to analyse large pools of data, gathered over long periods of
time in data warehouses (large databases), in a process known as data mining.
 Typical information that a decision support application might gather and present would be:
 Comparative sales figures between one week and the next.
 Projected revenue figures based on new product sales assumptions.
 The consequences of different decision alternatives, given past experience in a context that is
described.
 A decision support system may present information graphically and may include an expert
system or artificial intelligence (AI). It may be aimed at business executives or some other group
of knowledge workers.