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Management Information System: Benefits & Examples of Its Application

Did you know that? Like technological advancements in the business world, business activities necessitate the support of a management information system (MIS). In addition, almost all fields necessitate the use of a system capable of controlling and managing information properly and adequately.

An information system, in general, is an integrated set of components for collecting, processing, and storing data. These components will later produce a large amount of information to knowledge and digital products that we encounter daily.

Businesses and organisations use to run their operations. This system manages interactions with customers, suppliers of goods, and market competition.

Several large corporations, including eBay, Alibaba, and even Google, rely on information systems. E-commerce and marketplaces, for example, use digital screens to sell their products, and the product information they have is the result of IS.

The following are the disadvantages of not having a management information system:

  • Piracy and cybercrime are typical examples of technological crimes.
  • Individual liberty and competence do not grow.
  • Due to a lack of progress in IT, it does not strengthen the economy.
  • Media offers will present a limited range of interests and tastes.
  • The formation of community ties and relationships will be hampered.
  • An agency’s operations become inefficient.

In addition, consider the following definitions, benefits, and applications of MIS.

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Definition of Management Information System

A management information system (MIS) is a series or group of processes that process, analyse, and display data to be used in decision making. This system is a planning system that is part of the company’s internal control and consists of documents, human resources, technology, and management accounting processes.

The primary goal of this system is to collect and organise all data from various levels of business, summarise and then facilitate decision making, and improve quality to increase the company’s productivity and profitability.

Furthermore, there are a variety of expert opinions on the meaning of MIS, including:

L. Jamers Havery 

A management information system is a logical and rational process for executing or designing a series of interrelated components. 

Azhar Susanto 

A management Information System is a set or group of subsystems or parts or components of various types, physical or non-physical, interconnected for control, evaluation and continuous improvement.

Ludwig von Batalanfy 

A management information system is a set of interrelated elements in a relationship between these elements with the environment.

So far, are you interested in knowing more about management information systems? Then, check out the benefits and applications of SIM for the following business.

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Four Benefits of a Management Information System

Here are some of the advantages or benefits of using a MIS for management and a company as a whole.

1. Improving data accuracy 

Accurate data is needed in a company because it is related to strategic decisions. A management information system is a tool that provides accurate data needed by the company. 

The system automatically processes incoming data to make administrative tasks more effective and efficient. And with the support of internet technology, you can also retrieve the required data in the system in real-time. 

2. Facilitate coordination 

This system also provides information services that you can use for planning, monitoring and administrative control. From the resulting information, data can be used by other departments or departments in need. 

Information systems also help management to delegate tasks to other parties easily. Coordination between departments can also take place quickly without having to meet in person.

3. Improving the quality of human resources 

What is a management information system for executives? 

Of course, when information data is available accurately and quickly, this will affect the performance of the company’s human resources. 

Like it or not, HR who use this system must adapt their work system to technological advances. Quality resources will undoubtedly affect the progress of your business development in the future. 

4. Reduce operational costs 

If MIS has worked for your company, this system will help minimise human error. With a minimal number of errors, the productivity of existing human resources will also increase. Then at the same time, conditions like this certainly reduce the company’s operational costs.

Also read: Production Process in Business: Definition, Types, and Characteristics

Application of Management Information Systems in Business

Enterprise Resource Planning (ERP)

Usually, large companies often use ERP management information systems. However, this system can also be used on a small scale. ERP is generally used in management and in integrated monitoring between business units.

Supply Chain Management (SCM) 

This system is beneficial for management because it can help to integrate material supply management from suppliers, manufacturers, retailers to final consumers.

Transaction Processing System (TPS) 

TPS is a management information valuable system for processing large amounts of data or multiple and routine transactions. 

This program is widely used in payroll and inventory management. 

Office Automation System (OAS)

This application helps facilitate communication between departments within a company by integrating computer servers for each company user.

For example, the use of email for various activities in the office every day.

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Knowledge Work System (KWS)

This system integrates new knowledge into an entity or organisation/unit. i.

Informatic Management System (IMS)

IMS helps support various tasks within the organisation and analyses decision making. This system can also integrate various information functions with computer programs such as electronic shopping…

Decision Support System (DSS)

This system helps executives make decisions by observing the business environment. An example of this single management information system is links electronic.

Expert System (ES) and Artificial Intelligent (AI)

Both systems use artificial intelligence, which helps analyse a problem using expert energy knowledge.

Group Decision Support System (GDSS)

If the previous system was to analyse problems, this system is to find solutions to a problem through gathering knowledge in a group, not per individual. Usually in the form of questionnaires, consultations and scenarios. Examples such as e-government.

Computer-Support Collaborative Work System (CSCWS)

This system is a group of users who design a system to help work as a group and understand the impact of technology on their work patterns.

Executive Support System (ESS)

This system helps managers to interact with the corporate environment through graphics and other communication tools.

Related article: Benefits of Using a Cloud SCM


Management information systems provide several advantages and functions that are especially useful in business. As a result, this system can make work and decision-making more effective and efficient. However, reliable personnel must support the management information system, and involvement in the system’s design is required.

ERP in MIS is one such system that can assist in streamlining business operations by automating the most data-driven processes, performing extensive data analysis, and providing accurate data management, all within an intuitive and integrated framework.

Related article: What is ERP Software and What Can It Do for Your Business?

ERP can simplify complex business activities, increasing efficiency, saving costs and optimising your company’s productivity. Different scale companies can use this software, be it small, medium, or large. 

If you still don’t know which module you need in an ERP system, don’t hesitate to ask the right ERP solution provider. HashMicro offers a free consultation for those who are planning to implement ERP in their company. Click here.

Interest in getting savvy tips for improving your business efficiency?

Olivia Mariane Gunawan
Looking forward to give the readers more new insights and useful informations everyday! For business inquiries: [email protected]


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