The
structure of MIS can also be described in terms of organizational functions
which make use of information. The term organizational function information
systems is used to describe a variety of information system that support an
organizational function such as accounting, finance, production, marketing,
human resource management etc. Each of these functions has its own information
needs.
MIS
is a typically an integrated combination of functional information systems that
is designed to meet the info requirements of the functional subdivisions of an
organization. Each of these functions is considered as a subsystem. These
subsystems have info application related to that function only. In addition
there are common programs applicable to all functional subsystems. With in each
of these functional subsystems, there will be application for transaction
processing, operation control, managerial control and strategic planning.
Functional
Subsystems
The
important functional subsystems are the following.
1. Production
Subsystem
Production
info system support the production function which includes all activities
concerned with the planning & control of the processes that produce goods
or service. In the production subsystem there are transaction processing,
operation control, managerial control & strategic planning. The typical
info required at the transaction processing level is production orders. The
production order is generally based on the sales orders required by the
company.
At
the same time operational control level requires detailed reports comparing
actual performance with the production schedule & identifies the weak
areas. However management control requires a summary report which compares the overall
performance to actual performance. Strategic planning is concerned with
simplifying, automating ,integrating many of the activities needed to produce
goods.
2. Marketing
Subsystem
Marketing
is another important function of an organization. The success of an
organization depends on the efficiency of marketing. The marketing function of
an organization is concerned with the planning, promotion & sale of
existing products in existing markets & the development of new products
& new markets to satisfy existing & potential customers. Thus marketing
performs a vital function in the operation of the business enterprise.
MIS
help analyze dd for different products in different regions. It’s mainly
concerned with the marketing right product to target customers. Marketing info
system provides info for planning, control & transaction processing in the
market function. Strategic & operational info system assists marketing managers
in product planning, pricing decisions & advertising & sales promotion
strategies. MIS provides info that helps management to decide the number of sales
executives to assign specific products in specific geographical areas.
The
basic transaction is to be processed at transaction processing level is
customer’s orders & prepares invoice & bills. The operational control
activity includes the day to day scheduling of sales & promotional
activities. Managerial control level is concerned with comparison of overall
performance with the marketing plan. They require info relating to customers,
competitors etc. consideration of new markets & new product marketing strategies
are the issues dealt at the strategic planning level.
3. Human
Resource Subsystem
The
HRM function is concerned with the recruitment, placement, compensation &
development of employees in an organization. It mainly helps in record keeping
& employee evaluation. Every organization must maintain correct record of
its employees.
Produce
pay cheques & pay reports, maintain personal records & analyze the use
of personnel in business operation are the important activities done at the
transaction processing level. Management control level conducts budget analysis,
turnover analysis etc & showing the variances resulting from planned &
actual performance. Strategic planning of personnel involved with the planning
of alternative strategies for recruiting, training & compensating
employees. In this regard they have to collect different type of info from
external sources.
4. Finance
& Accounting Subsystem
Financial
subsystem undertakes the function of arranging adequate finance to the business
at min cost. This function includes granting credit to customers, cash management
& financial arrangement. Accounting info system record & report the
flow of funds through the organization on a historical basis & prepares
important financial statements like profit & loss account & balance
sheet.
Transaction
processing system engaged in the legal & historical record keeping &
produces financial statements. They undertake activities like order processing,
inventory control, payroll & general ledger systems. Management control level
focuses on planning & control of business operations & they compare the
actual cost of financial resources with the targeted cost. The strategic
planning level for accounting & finance involves in the long term
strategies connected with financial & accounting matters.
5. Logistics
Subsystem
The
logistic subsystem includes activities like purchasing, receiving, inventory
control & distribution. The transactions to be processed are purchase
requisitions, manufacturing orders, receiving reports & shipping orders.
The operational control function make use of info contained in reports like out
of stock items, over stocked items, inventory turn over reports etc managerial
control level compares the planned & actual inventory levels, cost of
purchased items, stock outs etc analysis of new distribution strategies,
adoption of new policy towards the sellers are some of the common tasks dealt
at the strategic planning level.
6. Information
Processing Subsystems
It’s
the responsibility of the info processing subsystem to provide the necessary
info processing services & resources. Typical transactions for info
processing are requests for processing, changes in data & program.
Managerial control over info processing requires data on planned & actual
performance. Acquisition of hardware & software & automation of info
processing etc are some of the strategic decision to b taken at the top level
management.
Next : MIS Structure Based on Management Activity
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