MIS (management information systems) is the department controlling hardware and software systems used for business-critical decision-making within an enterprise.
The MIS department was originally the whole of information technology. From the 1960s to the early 1980s, practitioners and business schools referred to MIS, rather than IT. In the early days, enterprise computing's main role was to help the CEO and CFO with information systems management for a few key run-the-business tasks, such as order entry, accounting and budgeting. No enterprise applications existed; programmers painstakingly wrote code to carry out these functions, usually on a mainframe.
These systems were business-critical, meaning a business would fail if it had to go back to manual accounting. If MIS failed, the business was in danger. The CFO oversaw MIS, ensuring the developers and administrators delivered what accounting needed.
In the 1980s, with the advent of personal computers that ran spreadsheets, the scope of computing's responsibilities began to change. Personal spreadsheets took business-critical processes out of the domain of upper management; MIS needed to service a wider range of users -- deploying external, as well as internal, software programs. The name of the department changed to reflect this new set of internal customers, becoming information systems (IS). The MIS department became one, still-vital part of the overall IS department.
How a MIS works
In addition to serving as a department within a company, MIS refers to computer software that is used to store, organize and analyze information. Management information systems are used to track sales, inventory, equipment and related business information. In the past, management information systems ran on mainframe computers. As computing systems evolved, MIS moved to run on client/server systems. Today, it’s common for MIS to run in the cloud or in a hybrid cloud.
Types of MIS
The four types of MIS are:
- Transaction Processing System (TPS), which processes the routine transactions associated with a business. Example transactions include payroll processing, order processing, such as for an e-commerce business, and invoicing.
- Management Support Systems (MSS), which store and organize data, enabling end users to generate reports and analyze data to address business needs and inform planning. A data warehouse is an example of a Management Support System.
- Decision Support Systems (DSS), which analyze business data to assist managers with decision making. For example, a DSS could project revenue figures based on new product sales assumptions.
- Expert Systems, which provide managers with insights and advice, using artificial intelligence (AI) to simulate the expert knowledge of a human in a particular field.
MIS vs. IT management
In the 1990s, the rise of the enterprise application brought about a new set of IS tasks. Companies succeeded by providing better services to the consumer than competitors, via a proper mix of enterprise applications and homegrown ones. The applications handled a wider range of functions than the original MIS department: order entry, accounting and budgeting, but also enterprise resource planning, supply chain management and sales force automation. Many of these tasks were not solely the property of the IS department -- outside vendors, outsourcers and line-of-business computing departments all claimed a share of enterprise computing.
Information systems became more of a strategic director of the software and underlying hardware technologies in the enterprise's architecture, and less of a controlling central entity. Again, the name changed to reflect the new role: information technology, or IT, rather than IS. Again, the original MIS department became a smaller part of the overall whole.
Today, the term management information systems is used broadly in various contexts. These include, but are not limited to:
- Decision support systems
- Resource and people management applications
- Project management
- Database retrieval applications.
Although the boundaries between MIS and IT management have become fuzzy over the years, typically, MIS still covers systems that are critical to the company's ability to survive, including accounting and order entry. Upper management should understand the importance of MIS in the context of enterprise revenue.
In many businesses, MIS handles legacy software and hardware, coded by programmers long since retired, who left no documentation for the systems. This is equally a role of IT management and business coordination. The enterprise upgrades or modernizes these systems only very carefully, and with high appreciation of the risks involved. Therefore, the importance of MIS, and the people who support it and know its quirks, remains high -- even if it is a little-discussed part of enterprise IT.
Importance of MIS
MIS, both the department and the software system, can help companies gain a competitive advantage. The data managed by an MIS system can help managers make better decisions related to sales, manufacturing, resource allocation and more. Both the MIS department and the software systems help organizations increase productivity by enabling workers to spend more time on productive tasks.
The MIS department plays an important role in providing these support services within an organization:
- Governance, which involves systems and controls over employees’ use of computing systems. This MIS department defines, manager and enforces rules on how (and whether) employees can access the company’s technologies and network infrastructure. MIS is responsible for IT security, as well as enforcing codes of conduct related to computer systems use.
- Infrastructure, which refers to the technology systems that support the day-to-day functioning of the business, such as phones, desktop/laptop computers, servers, application software and cloud computing. The MIS department provides internal help desk and support services, assisting employees and troubleshooting issues related to the infrastructure.
- Data management, which involves the provisioning and management of systems that enable employees to access and update critical business data. The MIS department is responsible for ensuring the availability and security of the data management systems.
Management information systems careers
The management information systems job description is likely to include financial concepts and duties alongside those of IT administration. Roles and responsibilities include network and computer systems management, business systems analysis, data integration, and compliance and audit preparations, as well as soft skills such as being a communicator who can liaison with the business units that rely on MIS.
A management information systems career could entail evaluating business applications and selecting those that will help the enterprise achieve sales, marketing or related goals. In turn, the MIS department then deploys and manages these applications throughout their lifecycle.
MIS jobs may require a degree in computer science or management information systems, specifically. The candidate should be able to manage IT and software vendors, and troubleshoot and optimize the computer systems and applications. In addition, they should be able to track metrics related to how effectively the application supports business objectives. The MIS career entails extensive planning and analysis for large-scale and business-critical projects, and it may require experience or education on finance and economics.