This PPT is prepared for students and other professionals regarding Management Information System (MIS) subject as lecture notes.This PPT aims to help students to recognize, specify and communicate effectively to data processing personnel to about information system. It also helps students to interpret new developments in information technology and fit into an overall framework. .OTHER TOPICS ARE DISCUSSED IN THE CONSECUTIVE PPTS

1. Prepared By
Assistant Professor
,(Ph.D),MBA,NET, B.Tech

2. MANAGEMENT
INFORMATION
SYSTEM
P R E PA R E D B Y
T. M A N O J K U M A R
A S S I S T A N T P R O F E S S O R
LECTURE NOTES-UNIT-2
B.Tech,MBA,NET,(Ph.D)

3. Unit-2
System Analysis and Design
A system is “an orderly grouping of interdependent components
linked together according to a plan to achieve a specific goal.”
Constraints of a System
A system must have three basic constraints −
A system must have some structure and behavior which is
designed to achieve a predefined objective.
Interconnectivity and interdependence must exist among
the system components.
The objectives of the organization have a higher priority
than the objectives of its subsystems.
For example, traffic management system, payroll system,
automatic library system, human resources information
system.

4. Unit-2
Elements of a System
The following diagram shows the elements of a system −

5. Unit-2
Outputs and Inputs
The main aim of a system is to produce an output, which is useful for its
user.
Inputs are the information that enters into the system for processing.
Output is the outcome of processing.
Processor(s)
The processor is the element of a system that involves the actual
transformation of input into output.
It is the operational component of a system. Processors may modify the
input either totally or partially, depending on the output specification.
As the output specifications change, so does the processing. In some
cases, input is also modified to enable the processor for handling the
transformation.

6. Unit-2
Control
The control element guides the system.
It is the decision–making subsystem that controls the pattern of activities
governing input, processing, and output.
The behaviour of a computer System is controlled by the Operating System and
software. In order to keep system in balance, what and how much input is
needed is determined by Output Specifications.
Feedback
Feedback provides the control in a dynamic system.
Positive feedback is routine in nature that encourages the performance of the
system.
Negative feedback is informational in nature that provides the controller with
information for action.

7. Unit-2
Environment
The environment is the “supersystem” within which an organization operates.
It is the source of external elements that strike on the system.
It determines how a system must function. For example, vendors and competitors of
organization’s environment, may provide constraints that affect the actual performance
of the business.
Boundaries and Interface
A system should be defined by its boundaries. Boundaries are the limits that identify its
components, processes, and interrelationship when it interfaces with another system.
Each system has boundaries that determine its sphere of influence and control.
The knowledge of the boundaries of a given system is crucial in determining the nature
of its interface with other systems for successful design.

8. Unit-2
Types of System
Physical and Abstract Systems
Open and Closed Systems
Adaptive and Non Adaptive System
Permanent or Temporary System
Natural and Manufactured System
Deterministic System

9. Unit-2
Types of Systems or Business Systems
The systems can be divided into the following types −
Physical or Abstract Systems
Physical systems are tangible entities. We can touch and feel them.
Physical System may be static or dynamic in nature. For example, desks and chairs are the
physical parts of computer center which are static. A programmed computer is a dynamic system
in which programs, data, and applications can change according to the user's needs.
Abstract systems are non-physical entities or conceptual that may be formulas, representation
or model of a real system.
Open or Closed Systems
An open system must interact with its environment. It receives inputs from and delivers outputs
to the outside of the system. For example, an information system which must adapt to the
changing environmental conditions.
A closed system does not interact with its environment. It is isolated from environmental
influences. A completely closed system is rare in reality.

10. Unit-2
Adaptive and Non Adaptive System
Adaptive System responds to the change in the environment in a way to improve their
performance and to survive. For example, human beings, animals.
Non Adaptive System is the system which does not respond to the environment. For example,
machines.
Permanent or Temporary System
Permanent System persists for long time. For example, business policies.
Temporary System is made for specified time and after that they are demolished. For example, A
DJ system is set up for a program and it is dissembled after the program.
Natural and Manufactured System
Natural systems are created by the nature. For example, Solar system, seasonal system.
Manufactured System is the man-made system. For example, Rockets, dams, trains.

11. Unit-2
Deterministic System
A deterministic system is a system in which a given initial
state or condition will always produce the same results.
There is no randomness or variation in the ways that inputs
get delivered as outputs
Characteristic
Deterministic system operates in a predictable manner and the
interaction between system components is known with certainty.
A system is deterministic if its outputs are certain.
This means that the relationships between its components are fully
known and certain.

12. Unit-2
Hence, when an input is given the output is fully predictable. All the entities in the
system and their interrelationships are well known and given an input the output can
be determined with certainty.
A deterministic system also called mechanistic system is one whose behavioural
patterns can be predicted if its present state and operation characteristics are known.
Such a system operates according to a predetermined set of rules.
Examples
A good example of a deterministic system is a computer program. The computer
programmer knows in advance the output his program will produce, if the program is
error free.
An example of a deterministic system is the common entrance examination for entry
into IIM.
For example, two molecules of hydrogen and one molecule of oxygen makes water.

13. Unit-2
Probabilistic System
A probabilistic system is one in which the occurrence of events
cannot be perfectly predicted. Though the behaviour of such a
system can be described in terms of probability, a certain
degree of error is always attached to the prediction of the
behaviour of the system.

14. Unit-2
Characteristic
A probabilistic system is one where events and occurrences
cannot be predicted with precise accuracy.
Probabilistic system is also called stochastic system is the one
whose outcome cannot be predicted with Precision. That is, not
certain what outputs will be achieved from specific input because
these systems are subjected to random influences from the
internal and external environment. Therefore, it cannot be
predicted precisely
Probabilistic systems are models of systems that involve
quantitative information about uncertainty
In a probabilistic system, unlike in a deterministic system, what
has just occurred is not always an accurate predictor of what will
transpire next
A probabilistic system must be analysed according to the various
possible outcomes and their relative probability of occurrence.

15. Unit-2
Examples
• The portfolio investment systems of an asset
management company that invests in the stock market will
have a probabilistic output for a given input as the system and
its entities behave probabilistically.
• Examples include the business system, economic system
and particularly agricultural system

16. Unit-2
SDLC is a process which defines the various stages involved in the development of
software for delivering a high-quality product. SDLC stages cover the complete life
cycle of a software i.e. from inception to retirement of the product.
Software Development Life Cycle Process

17. Unit-2
Given below are the various phases:
• Requirement gathering and analysis
• Design
• Implementation or coding
• Testing
• Deployment
• Maintenance

18. Unit-2
1) Requirement Gathering and Analysis
During this phase, all the relevant information is collected from the customer to develop a product as per
their expectation. Any ambiguities must be resolved in this phase only.
Business analyst and Project Manager set up a meeting with the customer to gather all the information like
what the customer wants to build, who will be the end-user, what is the purpose of the product. Before
building a product a core understanding or knowledge of the product is very important.
For Example, A customer wants to have an application which involves money transactions. In this case, the
requirement has to be clear like what kind of transactions will be done, how it will be done, in which currency
it will be done, etc.
Once the requirement gathering is done, an analysis is done to check the feasibility of the development of a
product. In case of any ambiguity, a call is set up for further discussion.
Once the requirement is clearly understood, the SRS (Software Requirement Specification) document is
created. This document should be thoroughly understood by the developers and also should be reviewed by
the customer for future reference.
2) Design
In this phase, the requirement gathered in the SRS document is used as an input and software architecture
that is used for implementing system development is derived.
3) Implementation or Coding
Implementation/Coding starts once the developer gets the Design document. The Software design is
translated into source code. All the components of the software are implemented in this phase.

19. Unit-2
Software Development Life Cycle Models
A software life cycle model is a descriptive representation of the software development
cycle. SDLC models might have a different approach but the basic phases and activity
remain the same for all the models.
1) Waterfall Model
Waterfall model is the very first model that is used in SDLC. It is also known as the
linear sequential model.
In this model, the outcome of one phase is the input for the next phase. Development of
the next phase starts only when the previous phase is complete.

21. Unit-2
4) Testing
Testing starts once the coding is complete and the modules are released for testing. In
this phase, the developed software is tested thoroughly and any defects found are
assigned to developers to get them fixed.
Retesting, regression testing is done until the point at which the software is as per the
customer’s expectation. Testers refer SRS document to make sure that the software is
as per the customer’s standard.
5) Deployment
Once the product is tested, it is deployed in the production environment or first UAT
(User Acceptance testing) is done depending on the customer expectation.
In the case of UAT, a replica of the production environment is created and the customer
along with the developers does the testing. If the customer finds the application as
expected, then sign off is provided by the customer to go live.
6) Maintenance
After the deployment of a product on the production environment, maintenance of the
product i.e. if any issue comes up and needs to be fixed or any enhancement is to be
done is taken care by the developers.

22. Unit-2
Waterfall model is the very first model that is used in SDLC. It is also known as the
linear sequential model.
In this model, the outcome of one phase is the input for the next phase. Development of
the next phase starts only when the previous phase is complete.
First, Requirement gathering and analysis is done. Once the requirement is freeze then
only the System Design can start. Herein, the SRS document created is the output for
the Requirement phase and it acts as an input for the System Design.
In System Design Software architecture and Design, documents which act as an input
for the next phase are created i.e. Implementation and coding.
In the Implementation phase, coding is done and the software developed is the input for
the next phase i.e. testing.
In the testing phase, the developed code is tested thoroughly to detect the defects in the
software. Defects are logged into the defect tracking tool and are retested once fixed.
Bug logging, Retest, Regression testing goes on until the time the software is in go-live
state.
In the Deployment phase, the developed code is moved into production after the sign off
is given by the customer.
Any issues in the production environment are resolved by the developers which come
under maintenance.

23. Unit-2
Advantages of the Waterfall Model:
Waterfall model is the simple model which can be easily understood and is the
one in which all the phases are done step by step.
Deliverables of each phase are well defined, and this leads to no complexity and
makes the project easily manageable.
Disadvantages of Waterfall model:
Waterfall model is time-consuming & cannot be used in the short duration
projects as in this model a new phase cannot be started until the ongoing phase
is completed.
Waterfall model cannot be used for the projects which have uncertain
requirement or wherein the requirement keeps on changing as this model
expects the requirement to be clear in the requirement gathering and analysis
phase itself and any change in the later stages would lead to cost higher as the
changes would be required in all the phases

24. Unit-2
V-Shaped Model
V- Model is also known as Verification and Validation Model. In this model Verification
& Validation goes hand in hand i.e. development and testing goes parallel. V model and
waterfall model are the same except that the test planning and testing start at an early
stage in V-Model.

25. Unit-2
(a) Verification Phase:
(i) Requirement Analysis:
In this phase, all the required information is gathered & analyzed. Verification
activities include reviewing the requirements.
(ii) System Design:
Once the requirement is clear, a system is designed i.e. architecture,
components of the product are created and documented in a design document.
(iii) High-Level Design:
High-level design defines the architecture/design of modules. It defines the
functionality between the two modules.
(iv) Low-Level Design:
Low-level Design defines the architecture/design of individual components.
(v) Coding:
Code development is done in this phase.

26. Unit-2
b) Validation Phase:
(i) Unit Testing:
Unit testing is performed using the unit test cases that are designed and is done in the Low-level
design phase. Unit testing is performed by the developer itself. It is performed on individual
components which lead to early defect detection.
(ii) Integration Testing:
Integration testing is performed using integration test cases in High-level Design phase.
Integration testing is the testing that is done on integrated modules. It is performed by testers.
(iii) System Testing:
System testing is performed in the System Design phase. In this phase, the complete system is
tested i.e. the entire system functionality is tested.
(iv) Acceptance Testing:
Acceptance testing is associated with the Requirement Analysis phase and is done in the
customer’s environment.

27. Unit-2
Advantages of V – Model:
It is a simple and easily understandable model.
V –model approach is good for smaller projects wherein the
requirement is defined and it freezes in the early stage.
It is a systematic and disciplined model which results in a
high-quality product.
Disadvantages of V-Model:
V-shaped model is not good for ongoing projects.
Requirement change at the later stage would cost too high

28. Unit-2
3) Prototype Model
The prototype model is a model in which the prototype is
developed prior to the actual software.
Prototype models have limited functional capabilities and
inefficient performance when compared to the actual software.
Dummy functions are used to create prototypes. This is a
valuable mechanism for understanding the customers’ needs.
Software prototypes are built prior to the actual software to
get valuable feedback from the customer. Feedbacks are
implemented and the prototype is again reviewed by the
customer for any change. This process goes on until the model
is accepted by the customer.

29. Unit-2

30. Unit-2
Steps of the prototyping model
In most cases, the steps of the prototyping model are as follows:
The new system requirements are defined in as much detail as possible. This usually involves interviewing a number
of users representing all the departments or aspects of the existing system.
A preliminary, simple design is created for the new system.
A first prototype of the new system is constructed from the preliminary design. This is usually a scaled-down system,
and represents an approximation of the characteristics of the final product.
The users thoroughly evaluate the first prototype and note its strengths and weaknesses, what needs to be added
and what should to be removed. The developer collects and analyzes the remarks from the users.
The first prototype is modified, based on the comments supplied by the users, and a second prototype of the new
system is constructed.
The second prototype is evaluated in the same manner as was the first prototype.
The preceding steps are iterated as many times as necessary, until the users are satisfied that the prototype
represents the final product desired.
The final system is constructed, based on the final prototype.
The final system is thoroughly evaluated and tested. Routine maintenance is carried out on a continuing basis to
prevent large-scale failures and to minimize

31. Unit-2
Advantages of Prototype Model:
Prototype model reduces the cost and time of development as the defects are found
much earlier.
Missing feature or functionality or a change in requirement can be identified in the
evaluation phase and can be implemented in the refined prototype.
Involvement of a customer from the initial stage reduces any confusion in the
requirement or understanding of any functionality.
Disadvantages of Prototype Model:
Since the customer is involved in every phase, the customer can change the
requirement of the end product which increases the complexity of the scope and may
increase the delivery time of the product

33. Unit-2
Marketing Information System
According to Philip Kotler, the four components that comprise the MkIS system
are Internal Reports (Records) System, Marketing Research System, Marketing
Intelligence System, and Marketing Decision Support System
1.Internal Reports System: It records various data from different department of
a company, which is regarded as a major source of information.
2.Marketing Intelligence System: It is a main source used by managers for
gaining daily information of the external environment, hence assists the
managers to react to the rapidly changing environment.
3.Marketing Research System: It is used to collect primary and secondary data,
and displays the results in forms of reports.
4.Marketing Decision Support System: Compared to the supply of the data by
the three previous systems, it focuses more on processing the data.

34. Unit-2
The Marketing Information System refers to the
systematic collection, analysis, interpretation, storage and
dissemination of the market information, from both the
internal and external sources, to the marketers on a regular,
continuous basis

35. Internal data consists of the information companies collect about their customers and prospective
customers, typically as part of their internal operations. Marketing departments, for example,
maintain information about the interest and leads they generate from prospective customers and
how they are interacting with these contacts. They may capture information used for
segmentation and targeting purposes, such as geographic location, gender, age, buying behaviors,
and communication preferences. Information about Web site visitors, traffic, and other customer
engagement activities can be another useful type of internal data. Additionally, sales teams
capture and maintain information about who is buying the product, where buyers are located,
buying patterns, and behaviors. Sales and marketing teams may also maintain information about
customer references, success stories, and how prospective customers are progressing toward
becoming new clients.
Other parts of the organization capture also capture and maintain data that may be useful as
marketing information. Accounting and billing departments track information about customers
such as how much they spend with the organization, when they buy, and other payment details.
Product managers and customer support organizations maintain information about customers
implementing or using products, problems or issues they run into, and satisfaction levels with the
company and products.
Internal Record

36. Unit-2
(Cont)Internal Record
Historically, it was standard for each department to maintain these data in their own
systems rather than in a common system or database that all parts of the organization
could access. This presented challenges for marketers, who had a difficult time gaining
access to complete, up-to-date internal data, since the information would need to be
pulled out of the various systems and put into usable formats before they could conduct
any sort of analysis.
Increasingly, organizations capture and maintain internal data by using information
systems and databases shared across multiple departments. A database is a set of
structured data accessible via a computer, and the data can be organized so that it’s
available for a variety of different uses, such as marketing or financial analysis.
Shared information systems may include large enterprise systems designed to support
business proceses and functions, customer support systems, and customer relationship
management (CRM) systems, among others.

37. Unit-2
Historically, it was standard for each department to maintain these data in
their own systems rather than in a common system or database that all parts of
the organization could access. This presented challenges for marketers, who
had a difficult time gaining access to complete, up-to-date internal data, since
the information would need to be pulled out of the various systems and put into
usable formats before they could conduct any sort of analysis.
Increasingly, organizations capture and maintain internal data by using
information systems and databases shared across multiple departments. A
database is a set of structured data accessible via a computer, and the data can
be organized so that it’s available for a variety of different uses, such as
marketing or financial analysis. Shared information systems may include large
enterprise systems designed to support business processes and functions,
customer support systems, and customer relationship management (CRM)
systems, among others.

38. Unit-2
Marketing Intelligence System
The routine information on the developments in the external market environment is
provided to the marketing management by the marketing intelligence system. This
subsystem has the scientific method, multiple methodologies, model building, creativity
& cost/ benefit measures for valuing the information.
Gathering market intelligence involves a number of activities, including scanning
newspapers, trade magazines, and economic data produced by the government to find
out about trends and what the competition is doing. In big companies, personnel in a
firm’s marketing department are primarily responsible for their firm’s market
intelligence and making sure it gets conveyed to decision makers. Some companies
subscribe to news service companies that regularly provide them with this information.
LexisNexis is one such company. It provides companies with news about business and
legal developments that could affect their operations.
Example when fuel prices hit an all-time high in 2008, unlike other passenger airline
companies, Southwest Airlines was prepared. Southwest had anticipated the problem,
and early on locked in contracts to buy fuel for its planes at much lower prices. Other
airlines weren’t as prepared and lost money because their fuel expenses skyrocketed.
Meanwhile, Southwest Airlines managed to eke out a profit. Collecting market
intelligence can also help a company generate ideas or product concepts that can then

39. Unit-2
Marketing Research: The Marketing Research is the systematic
collection, organization, analysis and interpretation of the primary
or the secondary data to find out the solutions to the marketing
problems. Several Companies conduct marketing research to
analyze the marketing environment comprising of changes in the
customer’s tastes and preferences, competitor’s strategies, the
scope of new product launch, etc. by applying several statistical
tools. In order to conduct the market research, the data is to be
collected that can be either primary data (the first-hand data) or
the secondary data (second-hand data, available in books,
magazines, research reports, journals, etc.)The secondary data are
publicly available, but the primary data is to be collected by the
researcher through certain methods such as questionnaires,
personal interviews, surveys, seminars, etc.
A marketing research contributes a lot in the marketing
information system as it provides the factual data that has been
tested several times by the researchers

40. Unit-2
Marketing Decision Support System (MDSS)
Marketing Decision Support System (MDSS) is the fourth
subsystem of the marketing information system that contains
statistical & decision tools for the assistance of managers in
making certain marketing decisions. There is supporting hardware
& software in the MDSS along with the combination of systems,
tools, data & techniques.
The marketing information is obtained and interpreted with the
help of MDSS for the purpose of getting assistance in making
decisions
Computer Software for Marketing
SAP R/3 version 4.0 for sales and distribution
SNAP & MARQUIS-software analysis for basic market analysis
SPSS-PC for more sophisticated market analysis

41. Unit-2
Features of Marketing Information System
The main features of marketing information system are continuous process, accuracy,
reliability and completeness, constancy and accessibility, interrelated components, right
time etc. They are made clearer by the following figure:
1. Continuous process
The important function of marketing information system is to collect necessary
information, select, analyze, review and evaluate them for taking proper decision and
controlling. This function goes on regularly. So, marketing information system is a
continuous process.
2. Accuracy, reliability and completeness
Marketing information system provides accurate, reliable and complete information for
taking rational and quick decision. Such types of information become compulsory in a
competitive environment.

42. Unit-2
3. Constancy and accessibility
The bases of information provided by marketing information system become same. So,
information becomes constant and uniform. Similarly, information can be easily
obtained. Due to the tremendous development in information technology, consistency
and uniformity in flow of information have become possible and easily accessible.
4. Interrelated components
Marketing research, marketing intelligence, internal record and information analysis
are the components of marketing information system. The components have an
important role to make information complete, reliable and updated.
5. Right time
Decision should be rational and quick. If there is no quickness in decision, it becomes
meaningless. This means, if a decision to be taken today is taken tomorrow, it becomes
meaningless and cannot work. Marketing information system provides accurate
information in proper time for taking quick and rational decision.

43. Unit-2
Importance of Marketing Information System
Marketing information system plays an important role in market expansion, effective marketing plan, environmental
scanning and monitoring, want creation and delivery, marketing programme formulation and implementing,
evaluation and control.
1. Expansion of market
Marketing information system plays an important role in market expansion besides conducting daily organizational
functions. It provides necessary information to promote market from local to national, national to regional and regional
to global market. In the lack of marketing information system, expansion of market becomes impossible. For example,
goods are to be shipped to American or European markets, it becomes necessary to get information about the wants,
needs, priority of consumers of these countries and market trend, price, quality, competition etc. in the markets. Such
information is possible only through marketing information system.
2. Marketing plan
Organizational success in competitive market depends on effective plans. Sufficient and reliable information about
customers’ wants, needs, changing fashion, strong and weak aspects of competitors, customers’ brand loyalty, buying
behavior, and buying motives etc. become necessary making effective plans. Marketing information system helps in
making effective marketing plans by providing information about such things.
3. Environmental monitoring and scanning
Environmental monitoring and scanning are the important organs of marketing information system. Business
organizations should monitor economic, political, legal, social, competitive, technological and other elements regularly.
Changes in such environmental elements provide opportunities on the one hand and threats on the other. So,
environmental elements should be scanned, opportunities be utilized and threats be faced.

44. Unit-2
4. Want creation and delivery
To get success in competitive environment, a business organization should be able to create wants of the
customers and deliver goods to satisfy their wants. Market research should be conducted and analysis be
made to identify customers’ wants and make them realize such wants. For this, marketing information
system is needed. As this psychological aspect of marketing, wants should be created only after clearly
studying the customers and goods or services should be produced accordingly.
5. Marketing program formulation and implementation
Success of a business organization depends on effective marketing plans and their implementation.
Marketing information system collects information about customers’ wants, needs, product price, discount,
commission, sale condition, possible demand etc. and analyzes and disseminates such information, which is
indispensable for making marketing plans and implementing them. So, marketing information system is also
very important to make marketing plans and implement them.
6. Evaluation and control
Regular evaluation and control of marketing program is an important task of marketing management
process. What types of programs become successful, what types of programs can help to achieve
organizational goal to what extent and what changes or improvement are needed in the programs etc. are the
matters related to study, evaluation and control which can be done only with the help of marketing
information system.

45. Unit-2
Definition:
1)Human resources information systems: concept “HRIS can be briefly
defined as integrated systems used to gather, store and analyze information
regarding an organization’s human resources.” (Hedrickson, 2003, p.381)
2) HRIS “One which is used to acquire, store, manipulate, analyze, retrieve and
distribute information about an organization’s human resources.”
(Tannenbaum 1990)
3) Human resources management systems (HRMS) or human resources
information systems (HRIS) can be defined as integrated systems used to
gather, store, and analyze information regarding an organization’s human
resources.
Using HRIS technology can help HR automate and simplify tasks, reduce
administration and recordkeeping, and provide management with HR-related
information when required

46. Unit-2
There are three major functional components of HRIS:
Input Subsystem: In Input subsystem there are three main
subsystems which are data processing, human resource research
and human resource intelligence.
HRIS database: In HRIS database all the data and information
can be stored in computer storage. The software such as Database
management system (DBMS) can help to perform the maintenance
processes.
Output subsystem: The Output subsystem contain all the output
related to HR consists of Workforce planning subsystem, recruiting
subsystem, workforce management subsystem, benefits subsystem,
compensation subsystem, environmental reporting subsystem.

47. Unit-2

48. Unit-2
INPUT SUBSYSTEM
Accounting Information Subsystem: This subsystem includes
two main types of data: Personnel – name, birth date, sex, marital
status, education, skills etc. and Accounting – It includes hourly
rate or monthly salary, taxes insurance deductions etc.
Human Resource Research Subsystem: This research can
generate new data for database and it can use existing database
contents. E.g.: Job analysis and evaluation, Succession studies and
Grievance studies etc.
Human Resource Intelligence Subsystem: HR has the
responsibility for interacting with the environmental elements of
any functional area.
Government – current on legislation, file reports.
Suppliers – employment services, labor unions, local community.
Competitors – sources of employees.

49. Unit-2
OUTPUT SUBSYSTEM
Work Force Planning Subsystem: This subsystem enables manager to
identify future personnel needs, salary forecasting, job analysis/ evaluation.
Recruiting Subsystem: In this subsystem manager will identify the
recruiting process that will be used in the organization.
Work Force Management Subsystem: This subsystem includes performance
appraisal, training ensuring that headcount does not exceed budgeted limits,
relocation and skill/ competency.
Benefit Subsystem: It includes benefits statements, flexible benefits, stock
purchase, claims processing.
Compensation Subsystem: They include payroll, executive compensation,
Bonus incentives, Attendances.
Environmental Reporting Subsystem: It includes reporting firm’s
personnel policies and practices to the government, Union increases, Health
records, Toxic substances and Grievances

50. Unit-2
Performance Evaluation This subsystem includes information regarding performance ratings,
the date these ratings were received, the type of appraisals that were used, comments about the
appraisal, and performance objectives and goals .
Compensation and Benefits Administration Information regarding the company’s
compensation and benefits plans and the policies relating to these plans are found in this
subsystem. For example, policies on the type of increases allowable when an employee receives a
promotion, data regarding pay grades and ranges for each position, positions that are entitled to
a bonus and bonus structure could be included. In addition, information regarding the type of
benefits plans, whether there is a cost-sharing arrangement, and what that arrangement would
be if an employee took an unpaid leave would also be available in this subsystem.
Organizational Management This subsystem includes the organizational structure and job
descriptions. It may have a field to enter the National Occupational Classification (NOC) codes..
It may also link positions/jobs to specific workers.
Health and Safety Accidents happen at work and organizations are responsible for reporting
these accidents to the Workers’ Compensation Board (or equivalent) in their jurisdiction. Data on
the number of accidents, types of accidents, health and safety complaints, resolutions, Workers’
Compensation claims, and related forms may be included in this subsystem.
Labor Relations Such information as seniority lists, union membership, grievances, and
resolutions of grievances can be found in this subsystem.
Payroll Interface This subsystem has information on salary, wages, and benefits to make it
easier to interface with accounting (payroll). Most HRIS systems today have a payroll component,
and the more sophisticated systems have an ability to directly interface with payroll providers

51. Unit-2

52. Unit-2

53. Unit-2

54. Unit-2

55. Unit-2

56. Unit-2

57. Unit-2

58. Unit-2

59. Unit-2
Special note about PeopleSoft

60. Unit-2
Financial Information SystemIs a system that
accumulates and analyses financial data in order to make
good financial management decisions in running the business.
Financial information systems are the software programs that
help businesses manage their money.
Systems can be set up to keep track of your banking, accounts
payable and accounts receivable; to generate standard
financial reports such as a profit-and-loss statement; and to
report the information in various formats. It's important to
choose a system that suits your business need

61. Unit-2

62. Unit-2
Elements of a financial information system
Input
Accounting Information Systems: The financial function of the enterprise
consists in taking stock of the flows of money and other assets into and out of an
organization, ensuring that its available resources are properly used and that the
organization is financially fit. The components of the accounting system include:
1. Accounts receivable records2.Accounts payable records3.Payroll
records4.Inventory control records5.General ledgers
Internal Auditing: The audit function provides an independent appraisal of an
organization's accounting, financial, and operational procedures and information.
All large firms have internal auditors, answerable only to the audit committee of
the board of directors
Finance intelligence talks about empowering employees with basic finance
knowledge so that they can make a sound business decision. Finance intelligence is
a skill set which every senior executive needs to have

63. Unit-2
Outputs
Financial Forecasting: Financial forecasting is the process of predicting the inflows
of funds into the company and the outflows of funds from it for a long term into the
future. Outflows of funds must be balanced over the long term with the inflows. With
the globalization of business, the function of financial forecasting has become more
complex, since the activities in multiple national markets have to be consolidated,
taking into consideration the vagaries of multiple national currencies.
Financial forecasts are based on computerized models known as cash-flow models. They
range from rather simple spreadsheet template
Spreadsheet programs are the main budgeting tools. Spreadsheets are the personal
productivity tools in use today in budget preparation.
Funds Management: Financial information systems help to manage the
organization's liquid assets, such as cash or securities, for high yields with the lowest
degree of loss risk. Some firms deploy computerized systems to manage their securities
portfolios and automatically generate buy or sell orders

64. Unit-2

65. Unit-2
Major Categories of Financial Information System

66. Unit-2

67. Unit-2

69. Design and Implementation of MIS

70. Unit-2
Step :# 1 Determine information needs and establish system needs
First, an analytical study of that information is made which are needed for the external
parties related to the organisation viz., government, customers, suppliers, labour
unions etc.The needs of information are related with the size of organisation, nature of
business, financial position, state government policies and several other factors.
There are two methods to judge the needs of the information. First, the users of the
information may be asked as to how much information they need to accomplish their
task. Secondly, they should be asked as to how they take the decision and then judge
what information should be provided to them.
The second step is to clearly define the objectives. Just monitoring to increase the
efficiency is not sufficient. Objective should be clear in terms of what one will do with
the information received by him. The size of the objectives is related with the planning,
management control and continuous flow of information.

71. Unit-2
Step :# 2 Develop Database
After estimating the need of information and clearly defining the
objectives. The next step step in installation of MIS is to determine the
sources of information. There are several sources. The internal sources of
are accounts, files, statistical papers etc. and external sources are
commercial and government publications. Information can also be
collected by personal interviews and personal inspections.
After determining the sources of information, the method of collection
and classification of information is chalked out. It is decided what will be
the source of information, frequency, quantity and time of information?
After collection how it will be classified? Where computers are used the
statistical information is feed into them, for which an outline is
prepared?

72. Unit-2
In this step the next process is to determine the method of giving information. It is
decided as to who the information is to be given, how many copies are to be prepared,
when and what will be its frequency and in which form it is to be given. They can be
communicated by reports, charts, statements or even orally. By doing so a complete
database can be prepared.
The next two steps in the process are done continuously.
Step 3 Determine Hardware needs and acquire equipment: After identifying the
needed source of information, database will be created based on that as mentioned in
the step 1 & 2.. Then based on that hardware needs and other equipment needed will
be identified. Exact nature of hardware needed and other equipment needed will be
determined. After that acquiring or procuring of the same will be done.
Step 4 :Determine Software Needs and acuire operating systems
One of the task is to assemble the one already in place and add to it as
required. While this is being done, the organisation must determine, what a
hardware , a software and operating system are needed to be acquired.

73. Unit-2
Step 5 & 6: Next step is the difficult task of integrating the
database, the hardware, the software and the operating system
long with appropriate control, after which system documentation
will be developed and the users are to be trained. System is then
tested and its deficiencies are corrected
Lastly Three to six months after implementation of management
information system, it should be evaluated, so that, it can be
judged whether the cost incurred in its implementation is less than
the benefits derived from it and, also if it satisfies the needs of the
persons using it. If it is not satisfactory, steps should be taken to
make to more effective and useful.

74. Unit-2
Manufacturing information system is a system that supports the manufacturing functions of
purchasing, receiving, quality control, inventory management, material requirements planning,
capacity planning, production scheduling, and plant design. The term manufacturing information
system actually applies to both manufacturing and service environments
Manufauturin
g
Information
System
Raw Material
Procurement
Subsystem
Cost
Subsystem
Inventory
SubsystemOrder
Processing
Subsyste
Production
Subsystem
Maintenance &
Scheduling
Subsyste

75. Unit-5
Raw Material Procurement Subsystem
Purchasing logistics of an entity critically affect time to market
and other quality related issues. The complexity of the purchase
subsystem should depend on types of raw materials required,
number of suppliers to deal with and complexity of the terms of
purchase agreements for long term supply chain management
spans all movement and storage of raw materials, work-in process
inventory, and finished goods from point-of-origin to point-of-
consumption. A procurement system should help in improving the
supply chain of the organization.
Inventory Sub System: Inventory subsystem focuses on
maintaining records and movements on inventory levels and usage
Timely production of finished goods require availability of right
quantity of material, maintenance of right stock levels,
determination of lead times and flex times and exchange of
information with supplier at the right time

76. Unit-2
Production Sub System Basically it tracks the flow of the job
through the entire production process. It also records change in
form of goods or transfer of goods from one place to the other
Maintenance & Scheduling Sub System: For efficient
production, the machines should be timely available. Many a
times, the machine is under repair and is not available to be
used for production. Without this subsystem, there is a
possibility of customer’s orders not being met on time.
Quality Sub system: This subsystem ensures the production
made and end product being delivered to the customer is
conforming the quality standards set by the company. Quality
covers aspects for the organization like better quality raw
materials and what is being purchased is according to
organization’s standards and improved finished goods in
accordance with the customer specification.

77. END OF UNIT-2