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An information system (IS) is any combination of information technology and people's


activities using that technology to support operations, management, and decision-
making. In a very broad sense, the term › ›  
 is frequently used to refer to
the interaction between people, algorithmic processes, data and technology. In this
sense, the term is used to refer not only to the information and communication
technology (ICT) an organization uses, but also to the way in which people interact with
this technology in support of business processes.

So in short it is an information system that collects, processes, stores, analyses and


disseminates information for a specific purpose. The basic components of computer
based information system are as follow:

Kc èardware
Kc Software
Kc ðata
Kc hetwork
Kc rocedure
Kc eople

]  
   
ðefinition: MIS refers broadly to a computer-based system that provides managers with
the tools for organizing, evaluating and efficiently running their departments. In order
to provide past, present and prediction information, an MIS can include software that
helps in decision making, data resources such as databases, the r    of a
system, decision support systems, people management and project
management applications, and any computerized processes that enable the department
to run efficiently.
]ithin companies and large organizations, the department responsible for computer
systems is sometimes called the MIS department.

The development and management of information technology tools assists executives


and the general workforce in performing any tasks related to the processing of
information. MIS and business systems are especially useful in the collation of business
data and the production of reports to be used as tools for decision making.

Commonly, MIS are used within organizations to allow many individuals to access and
modify information. In most situations, the management information system mainly
operates behind the scenes, and the user community is rarely involved or even aware of
the processes that are handled by the system.

D D 

A computer system used to process orders for a business could be considered a


management information system because it is assisting users in automating processes
related to orders. Other examples of modern management information systems are
websites that process transactions for an organization or even those that serve support
requests to users. A simple example of a management information system might be the
support website for a product, because it automatically returns information to the end
user after some initial input is provided.

Online bill pay at a bank also qualifies as a management information system ³ when a
bill is scheduled to be paid, the user has provided information for the system to act
against. The management information system then processes the payment when the
due date approaches. The automated action taken by the online system is to pay the bill
as requested. Since the bills within an online bill pay system can be scheduled to be
automatically paid month after month, the user is not required to provide further
information. Many times, the bill pay system will also produce an email for the user to
let him know that the action has occurred and what the outcome of the action was.
Many people use management information systems every day without thinking about
the actual system they are using. The individual will see a website and enter
information with the expectation that a specific action will happen; these websites, just
like the accounting systems used by large corporations, act as management information
systems to automate the process.

   


]ith computers being as ubiquitous as they are today, there's hardly any large business
that does not rely extensively on their IT systems.

èowever, there are several specific fields in which MIS has become invaluable.
à
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]hile computers cannot create business strategies by themselves they can assist
management in understanding the effects of their strategies, and help enable effective
decision-making.

MIS systems can be used to transform data into information useful for decision making.
Computers can provide financial statements and performance reports to assist in the
planning, monitoring and implementation of strategy.

MIS systems provide a valuable function in that they can collate into coherent reports
unmanageable volumes of data that would otherwise be broadly useless to decision
makers. By studying these reports decision-makers can identify patterns and trends that
would have remained unseen if the raw data were consulted manually.

MIS systems can also use these raw data to run simulations ² hypothetical scenarios
that answer a range of ¶what if· questions regarding alterations in strategy. For instance,
MIS systems can provide predictions about the effect on sales that an alteration in price
would have on a product. These ðecision Support Systems (ðSS) enable more informed
decision making within an enterprise than would be possible without MIS systems.

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hot only do MIS systems allow for the collation of vast amounts of business data, but
they also provide a valuable time saving benefit to the workforce. ]here in the past
business information had to be manually processed for filing and analysis it can now be
entered quickly and easily onto a computer by a data processor, allowing for faster
decision making and quicker reflexes for the enterprise as a whole.

 

 
›

]hile MIS systems are extremely useful in generating statistical reports and data
analysis they can also be of use as a Management by Objectives (MBO) tool.

MBO is a management process by which managers and subordinates agree upon a


series of objectives for the subordinate to attempt to achieve within a set time frame.
Objectives are set using the SMART ratio: that is, objectives should be Specific,
Measurable, Agreed, Realistic and Time-Specific.

The aim of these objectives is to provide a set of key performance indicators by which
an enterprise can judge the performance of an employee or project. The success of any
MBO objective depends upon the continuous tracking of progress.

In tracking this performance it can be extremely useful to make use of an MIS system.
Since all SMART objectives are by definition measurable they can be tracked through
the generation of management reports to be analyzed by decision-makers.



] 
     
Kc The information explosion ² growing base of knowledge workers
Kc The rapid pace of change(globalization, rapid social changes, legislative changes,
downloading, funding cuts, job losses, tax reforms and so on)
Kc The increasing complexity of Management (demands on quality,
competitiveness, timely delivery, etc.)
Kc The interdependence of organization units (finance, family welfare, fund-raising,
personnel, etc.)
Kc The improvement of productivity (better outreach, more clients, more programs,
better accuracy, etc.)
Kc The availability of computers for End-users(easy access, hands on service, wide
literacy and interest)
Kc The recognition of information as a resource

  

Effective management information systems are needed by all business organization


because of the increased complexity and rate of change of today·s business
environment. For Example, Marketing manager need information about sales
performance and trends, financial manger returns, production managers needs
information analyzing resources requirement and worker productivity and personnel
manager require information concerning employee compensation and professional
development? Thus, effective management information systems must be developed to
provide modern managers with the specific marketing, financial, production and
personnel information products they required to support their decision making
responsibilities.

An MIS provides the following benefit:


4  ››
 ›  MIS improves the quality of plans by providing relevant
information for sound decision ² making. ðue to increase in the size and complexity of
organizations, managers have lost personal contact with the scene of operations.

 › ››
› › 
 MIS change the larger amount of data in to
summarized form and there by avoids the confusion, which may arise when managers
are flooded with detailed facts.

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››  ðecentralization of authority is possible when there
is a system for monitoring operations at lower levels. MIS is successfully used for
measuring performance and making necessary change in the organizational plans and
procedures.

 › › ›  MIS facilities integration of specialized activities by keeping


each department aware of the problem and requirements of other departments. It
connects all decision centers in the organization.

 
  
›
 MIS serves as a link between managerial planning and control.
It improves the ability of management to evaluate and improve performance. The used
computers has increased the data processing and storage capabilities and reduced the
cost.

6. MIS assembles, processes, stores, retrieves, evaluates and disseminates the


information.

 


   Reducing the level of redundancy equates to cost-savings.
]hen redundancy is reduced and/or eliminated, this saves on man hours worked and
frees up employees to take on other tasks. In addition, processes can be streamlined
through information systems, which further reduce redundancy.

› 


› ›
Efficiency is another tangible benefit of assimilating information
systems. ]hen computers can take over some of the tedious, detailed and mundane
tasks, this makes processes move more quickly with a higher degree of accuracy. ]hile
it's true employees still play an importance role in ensuring data is entered correctly,
once entered in the program, the management information system can effectively
increase efficiency and data integrity.

Thus, investing in information systems keeps a business competitive and helps an


organization carry the ability to maintain visible status in the global economy. ]ithout
IS, a business will more than likely fall rapidly behind.

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à  !›  

 Improved reporting of business processes
leads inevitably to a more streamlined production process. ]ith better information on
the production process comes the ability to improve the management of the supply
chain, including everything from the sourcing of materials to the manufacturing and
distribution of the finished product.

The benefits of integrating technology within an organization can truly be limitless


depending on the level of creativity, strategic planning and innovation in the


 processes.

4 " › #

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 Better MIS systems enable an enterprise to react more quickly to their
environment, enabling them to push out ahead of the competition and produce a better
service and a larger piece of the pie.

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]hile the benefits typically outweigh the drawbacks, it is important that organizations
recognize the challenges and responsibility that do come with integrating information
systems.

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 › !
!
 Organizational change is typically one of the largest hurdles a
business has to contend with when updating their business environment to include new
technology. Change is hard and management may find that many employees do not
welcome this change.

  

 ðevelopment and cost is another challenge. A project such as this
can be extremely costly, so it is critical to do proper analysis, design and testing prior to
adding new systems. A business will want to be sure the technology will provide long
term benefits and the costs do not outweigh the return on the investment.

]hile the benefits are numerous and payoff can be excellent, the initial costs of
incorporating information systems are very pricey. Many businesses find themselves
either delaying or avoiding new technology because of the initial investment involved.

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›

››› : Additionally, the company will need to determine
reliability and accuracy so that the maximum benefits will be derived. This means time
will need to be invested in careful system analysis before development to insure that the
information system will meet the requirements of the business processes.

  ›  
›  rivacy and security is another huge challenge for organizations
that use technology. Information is a valuable commodity and there is a large
responsibility that comes with maintaining data. A lot of sensitive information is
collected through the course of business and this responsibility is one that should be
taken seriously.
]hen making decisions, privacy should be considered and any laws abided to. In
addition ongoing security is essential, and this is an expensive maintenance that bears
no incoming revenue.

Unfortunately many organizations put security on the backburner in favor of other


processes such as marketing, accounting or sales because these are what impact
incoming revenue; however even one data breach can destroy a business, so these days
security is just as important as other business processes. Security cannot and should not
be ignored, and is a significant challenge in using information systems.

    ›› 


 Change in management, exits or departures of department
managers and other senior executives have a broad effect on the working and
monitoring of certain organization practices including MIS systems. Since MIS is a
critical component of an organization's risk management strategy and allied systems,
constant monitoring is necessary to ensure its effectiveness. Quality of inputs into MIS
needs to be monitored; otherwise consistency in the quality of data and information
generated gets affected. Managers are not able to direct business, operational and
decision-making activities with the requisite flexibility.

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› ›  A potential problem with relying on electronic
communication and processing of information is the loss of the vital human element.
Sometimes, because of the complexity of information, an MIS report cannot effectively
summarize it. Very rich information is needed to coordinate and run an enterprise, and
certain classes of information cannot be quantified. For example, it might be wrong to
evaluate an employee's performance solely based on numbers generated by an MIS.
humbers can indicate a performance problem, but a face-to-face meeting is necessary to
discuss the nature of the problem.



è   
The set of two overheads on steps in MIS development is to be introduced while
discussing the different stages. These steps are more appropriate for a computer based
MIS.


››   
› › 
In this phase, the agency needs to critically assess its current system in order to justify
the cost and time involved before deciding on having a new MIS. The facilitator needs
to clarify the MIS need not always involve computers. èowever, if there are computers
the work gets accelerated.

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, ›

-  ›
The facilitator discusses the methods and means of ascertaining the information needs
to be addressed by MIS. Further, the mechanisms for gathering information from
primary and secondary sources are to be determined by agencies. A critical factor is
ascertaining MIS needs of primary and secondary users.

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The facilitator explains basics of a MIS system elucidating the inputs, the processing
and the outputs. ]hile inputs include information provided by front-line workers, the
outputs could be various types of reports, including those sent periodically to funders.
The procedures define how and in what format the information will be inputted and by
whom and at what intervals. The storage could be manual or electronic or both. ðesign
specifies the operational parameters at a drawing board stage. One of the inputs for MIS
could be information from a client database.

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The facilitator systematically discusses the different steps in MIS development in a
universalized perspective. In other words, it needs to be specified that these steps need
to be tailored to one·s own situation. In the acquisition stage, hardware is procured after
appraisals and cost analysis. ðraw attention to the need to ensure compatibility
between what is being acquired and what is already available within the agency.

The implementation step is a crucial one consuming considerable amount of time in


MIS development. èere the application development is done customized to the
agency·s needs. The procedure and user manuals are developed and personnel are
oriented in using MIS. The software is installed once it is tested and debugged.
The development of effective information systems holds a number of challenges for
small businesses. "ðespite, or perhaps because of, the rapid development of computer
technology, there is nothing easy or mechanical about building workable information
systems, " Laudon and Laudon stated. "Building, operating, and maintaining
information systems are challenging for a number of reasons." For example, some
information cannot be captured and put into a system. Computers often cannot be
programmed to take into account competitor responses to marketing tactics or changes
in economic conditions, among other things. In addition, the value of information
erodes over time, and rapid changes in technology can make systems become obsolete
very quickly. Finally, many companies find systems development to be problematic
because the services of skilled programmers are at a premium.

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ð 

MIS and ðSS are business-related information systems, which share some similarities
but are ultimately differentiated in terms of components, dynamics, analytical methods
and general properties. MIS function to furnish managers with reports on past and
current organizational performance, thereby enabling the monitory of actual business
performance and aiding the prediction of future ones. ]ithin such a context, it may be
described as addressing the needs of those managers who are interested in weekly,
monthly or yearly results, compared to day-to-day ones. Furthermore, founded upon
the TS, MIS draws data from internal organization sources, summarizes it and
presents that regularly and answers structured questions, is processed via a simple
method that relies on comparison and summarization. Therefore, processing involves
reports, simple models and low-level analysis, outputting summary and exception
reports. As regards users, professionals and staff managers primarily employ MIS.

In comparison, ðSS may be defined as a ´coherent system of computer based


technology used by managers as an aid in their decision making in semi-structured
tasks.µ ]hile, MIS functions to produce routine-reports, ðSS employ sophisticated data
modeling and analysis tools for the purpose of resolving quasi-structured problems.
Secondly, whereas MIS is used by a limited group (staff managers and professionals)
ðð are used by groups, individuals and managers across various levels. Thirdly, ðSS is
characterized by an adaptability, which contrasted with the semi-flexible nature of MIS.
Lastly, ðSS data sources are much more varied, comprising inventory, accounting and
production sources and not just internal business ones, and its analytical tools are more
sophisticated, including simulation, statistical analysis are in-built spreadsheets.

The essential difference between the two is in focus. ðSS, as the permanent status
indicates, is about leadership and senior management surrounded by
an organization providing good, reliable judgment as ably as vision. MIS, on the other
hand, is about focusing on the actual flow of information itself.
MIS focuses on operational efficiency (comfort organization "do things rightµ). It plans
reports on variety of subject, reports are standard, structured, routine, constraint by
organizational system.ðSS focuses on making effective decision (help collective "do the
right thingµ) and on finding making, unstructured and available on request, immediate,
friendly.
MIS is basically a compassionate of link to facilitate communication between managers
across different areas in a business association. MIS plays a pivotal role in enabling
communications across the floor of an organization, between multiple entities therein.
ðSS, many consider, is advancement from the original MIS. èowever, this is not the
sole difference between the two. ]hile there may not be too much separating the two,
the difference is still within, as is apparent when we say ðSS is advancement over MIS.
These and few other differences have been summarized below:

1.c MIS functions to produce routine reports, ðSS employ sophisticated data
modeling & analysis tools for the purpose of resolving structured problems.

2.c MIS is used by a limited group (staff managers & professionals); ðSS are used by
groups, individuals & managers at various levels.

3.c ðSS is characterized by an adaptability which contrasted with the semi-inflexible


nature of MIS.

4.c ðSS data sources are much more varied comprising inventory, accounting &
production sources & not just internal business ones & its analytical tools are
more sophisticated (simulation, statistical analysis).

Thus, MIS & ðSS are differentiated in terms of components, dynamics, analytical tools
& general properties.

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To simplify prompt decision making, an institution's MIS should be capable of


providing and distributing current information to appropriate users. Information
systems should be designed to expedite reporting of information. The system should be
able to quickly collect and edit data, summarize results, and be able to adjust and
correct errors promptly.

-  
A sound system of automated and manual internal controls must exist throughout all
information systems processing activities. Information should receive appropriate
editing, balancing, and internal control checks. A comprehensive internal and external
audit program should be employed to ensure the adequacy of internal controls.

 ›

To be reliable, data should be processed and compiled consistently and uniformly.
Variations in how data is collected and reported can distort information and trend
analysis. In addition, because data collection and reporting processes will change over
time, management must establish sound procedures to allow for systems changes.
These procedures should be well defined and documented, clearly communicated to
appropriate employees, and should include an effective monitoring system.





ðecision makers need complete and pertinent information in a summarized form.
Reports should be designed to eliminate clutter and voluminous detail, thereby
avoiding "information overload."

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Information provided to management must be relevant. Information that is
inappropriate, unnecessary, or too detailed for effective decision-making has no value.
MIS must be appropriate to support the management level using it. The relevance and
level of detail provided through MIS systems directly correlate to what is needed by the
board of directors, executive management, departmental or area mid-level managers,
etc. are in the performance of their jobs

  
   


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: It is an integrated computer-based application used
to manage internal and external resources, including tangible assets, financial resources,
materials, and human resources. Its purpose is to facilitate the flow of information
between all business functions inside the boundaries of the organization and manage
the connections to outside stakeholders. Built on a centralized database and normally
utilizing a common computing platform, ER systems consolidate all business
operations into a uniform and enterprise-wide system environment.
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! 
 : A data warehouses a database used for reporting. The
data is offloaded from the operational systems for reporting. The data may pass
through an Operational ðata Store (OðS) for additional operations before it is used in
the ð] for reporting. A data warehouse maintains its functions in three layers: staging,
integration and access.

A data mart (ðM) is the access layer of the data warehouse environment that is used to
get data out to the users. It is a subset of data warehouse.

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: These functional areas include Marketing, èuman resouce,
Accounting, Finance departments, etc.

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: Customers, Suppliers, Competitors and Stockholders, whose data is not
already captured by the TS.

 

 Tthe Internet is a global system of interconnected computer networks that use
the standard Internet rotocol Suite (TC/I) to serve billions of users worldwide. It is
a
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( that consists of millions of private, public, academic, business, and
government networks, of local to global scope, that are linked by a broad array of
electronic and optical networking technologies.

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: An extranet is a computer network that allows controlled access from the
outside, for specific business or educational purposes. An extranet can be viewed as an
extension of a company's intranetthat is extended to users outside the company,
usually partners, vendors, and suppliers. It has also been described as a "state of mind"
in which the Internet is perceived as a way to do business with a selected set of other
companies (business-to-business, B2B), in isolation from all other Internet users. In
contrast, business-to-consumer (B2C) models involve known servers of one or more
companies, communicating with previously unknown consumer users


‰  

Scheduled reports: A scheduled business report is a report that comes out at a


predetermined time. It can be produced periodically or on a schedule (daily. weekly,
monthly, quarterly, semi-annually, annually)

Key-indicator Reports: Summarizes the previous day·s critical activities. Typically


available at the beginning of each day

ðemand Reports: Reports that come out when somebody needs them, it gives certain
information on manager·s request

Exception Reports: Report that comes out only when something happens, like an
accident or other non expected occurrence. These are automatically produced when a
situation is unusual or requires management action.

ðrill-down Reports: rovides increasingly detailed data about a situation. ðrill ðown
reports are triggered by clicking on a designated field of an existing report

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management information system is used for generating reports including inventory


status reports financial statements performance reports etc. These reports are essential
for analyzing different aspects of business. These reports also help to answer 'what-if'
questions like what would be the effect on cash flows of a company if the credit term is
changed for its customers etc.

MIS reports also support decision making and it helps to integrate the decision maker
and the quantitative model being used. These automated systems allow managers to
make decisions for smooth & successful operation of businesses. The systems includes
computer resources people and procedures used in the modern business enterprise

In the accounting sense, we can list out the following MIS reports:

1. eriodical financial reports

2. eriodical costing & Budget reports

3. Inventory Reports

4. ðebtors/creditors Age wire reports

5. Any other reports required by the management.

In order to provide past, present and prediction information, an MIS can include
software that helps in decision making, data resources such as databases, the hardware
resources of a system, decision support systems, people management and project
management applications, and any computerized processes that enable the department
to run efficiently.

à›  



The system ensures that an appropriate data is collected from the various sources,
processed, and sent further to all the needy destinations. The system is expected to
fulfill the information needs of an individual, a group of individuals, the management
functionaries: the managers and the top management.

The MIS satisfies the diverse needs through a variety of systems such as Query
Systems, Analysis Systems, Modeling Systems and ðecision Support Systems the MIS
helps in Strategic lanning, Management Control, Operational Control and Transaction
rocessing.

The MIS helps the clerical personnel in the transaction processing and answers their
queries on the data pertaining to the transaction, the status of a particular record and
references on a variety of documents.

The MIS helps the junior management personnel by providing the operational data for
planning, scheduling and control, and helps them further in decision making at the
operations level to correct an out of control situation.

The MIS helps the middle management in short them planning, target setting and
controlling the business functions. It is supported by the use of the management tools of
planning and control.

The MIS helps the top management in goal setting, strategic planning and evolving the
business plans and their implementation.

The MIS plays the role of information generation, communication, problem


identification and helps in the process of decision making. The MIS, therefore, plays a
vital role in the management, administration and operations of an organization.

à   ›    

The automation in manufacturing companies has significantly improved in all areas of


processing, but at the same time it has also created a staggering amount of data.

Though IT departments have taken advantage of hardware improvements to


economically store the increased data, there never seems to be enough time or resources
to meet the needs of factory managers who face the ´fact gapµ that exists between the
data and the usable information required to make real business decisions.

For manufacturing/operations companies, getting the right information to the right


people in a timely manner has never been more important than it is today ² to reduce
hidden costs, to increase production, and to maximize profits.

Manufacturers have to manage the complexity of their supply chain, internal


manufacturing, and operations along with meeting their distribution and customer
requirements. Manufacturers today are faced with making extremely complicated
decisions in real-time, on a daily basis, with limited information. Manufacturers face
increasing globalization, more competition than ever, and customers whose demands
reflect their own knowledge and expectations of a global market.

Every manufacturing company is different like different processes, different tracking


systems and different challenges. All of these variations add up to the fact that you need
a management information system (MIS) that caters to the specific needs as well. ]hile
looking for a MIS solution you may define your needs and formulate a list of
requirements that simplify the adoption of information technology for improving
performance.

In the manufacturing industry, information quality issues exist throughout the supply
chain. One reason for this is that manufacturers depend on data from suppliers, contract
manufacturers, distributors, retailers, and consumers in order to effectively and
efficiently source raw materials, forecast demand, make and market their products.
Very seldom will manufacturers have control over the quality and format of this
external data. Through incremental improvements in data quality throughout the
supply chain, however, manufacturers can realize significant performance
improvements, including improved speed and efficiency of product manufacture,
improved ability to perform demand analysis, improved channel partner effectiveness
through timely and accurate product and pricing information, and improved customer
satisfaction through timely and accurate customer information. Measurement and
verification are needed to ensure the information quality program is reaching its
objective.
The single biggest obstacle to deploying a MIS in manufacturing is data: availability,
quality, and access. Several factors make it difficult to ensure optimal performance in
manufacturing. ðata and events come from many disparate sources, including those of
your suppliers, contract manufacturers, and other business partners. ðata types and
formats vary from one source to the next. Business partners in the collaborative supply
chain may use different data schemas and systems to track their manufacturing
process. Large volumes of data must be processed from each interface and subsystem
used in the manufacturing process.

A MIS tool should also easily integrate with operational applications and legacy
systems that already exist in a typical manufacturing environment. Real-time
manufacturing data need to be put into many different contexts for other roles in the
organization that are contributing to the optimal performance of the real-time
enterprise.

Manufacturing companies today have extensive inventories to track and move, a


greater number of products to generate, numerous suppliers to negotiate with and
quality standards to maintain. They also have an ever-increasing need to acquire, satisfy
and retain additional customers to remain profitable. Because of these complex
pressures, it is imperative that all the links in the supply chain be managed successfully.

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CASE STUDY:

MIS

Of

PepsiCo

Layns Sales Departmen t


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epsi was founded in 1898 by Caleb Bradham, a hew Bern, horth Carolina, druggist,
who first formulated epsi-Cola.

Today, Brand epsi is part of a portfolio of beverage brands that includes carbonated
soft drinks, juices and juice drinks, ready-to-drink teas and coffee drinks, isotonic sports
drinks, bottled water and enhanced waters. epsiCo Americas Beverages (AB) has
well known brands such as Mountain ðew, ðiet epsi, Gatorade, Tropicana ure
remium, Aquafina water, Sierra Mist, Mug, Tropicana juice drinks, ropel, SoBe, Slice,
ðole, Tropicana Twister and Tropicana Season's Best.

epsiCo Americas Foods (AF) is epsiCo's food and snack business in horth and
South America. Its portfolio of businesses includes Frito-Lay horth America, Quaker
Foods & Snacks, Sabritas, Gamesa and Latin America Foods.

2
  
  


In 1932, C.E. ðoolin entered a small San Antonio cafe and purchased a bag of corn
chips. Little did he dream this savory chip would become one of the nation's most
popular snacks. Mr. ðoolin learned that the manufacturer of the chips was eager to sell
his small business, so he purchased the recipe, and began to sell FRITOS® Corn Chips
from his Model T Ford.

Meanwhile, that same year, èerman ]. Lay began his potato chip business in hashville
by delivering snack foods. hot long after, Mr. Lay purchased the manufacturer, and the
è.]. Lay & Company was formed. è.]. Lay & Company became one of the largest
snack food companies in the Southeast, and LAY'S® brand otato Chips is still
America's favorite potato chip.

Years later, in 1961, the Frito Company and the è.]. Lay Company merged to become
Frito-Lay, Inc. Today, Frito-Lay horth America makes some of the most popular snacks
in the US, including LAY'S® and RUFFLES® potato chips, ðORITOS® tortilla chips,
TOSTITOS® tortilla chips and dips, CèEETOS® cheese flavored snacks, FRITOS® corn
chips, ROLð GOLð® pretzels, SUhCèIS® multigrain snacks, CRACKER JACK®
candy coated popcorn.

  D




epsiCo Asia, Middle East & Africa (´AMEAµ) makes, markets and sells a number of
leading snack food brands including Lay·s, Kurkure, Chipsy, ðoritos, Smith·s, Cheetos,
Red Rock ðeli and Ruffles, through consolidated businesses as well as through
noncontrolled affiliates. Further, either independently or through contract
manufacturers, AMEA makes markets and sells many Quaker-brand cereals and
snacks. AMEA also makes markets and sells beverage concentrates, fountain syrups
and finished goods, under various beverage brands including epsi, Mirinda, 7U and
Mountain ðew. These brands are sold to authorized bottlers, independent distributors
and retailers. èowever, in certain markets, AMEA operates its own bottling plants and
distribution facilities. In addition, AMEA licenses the Aquafina water brand to certain
of its authorized bottlers. AMEA also, either independently or through contract
manufacturers, makes markets or sells ready-to-drink tea products through an
international joint venture with Unilever (under the Lipton brand name).

 !

In akistan, epsi was introduced in 1979. Initially epsi faced a lot of problems
because Coca Cola had the larger share.

èowever, epsiCo started gaining strength in the 80s in akistan. epsiCo has a
number of offices and factories located in the major cities of akistan such as Lahore,
Karachi, and Islamabad etc. Every office has two divisions of epsiCo that are
Beverages and Food & Snacks working simultaneously.
 


The main head office of epsiCo in Lahore is situated in Gulberg. There are 8
departments at this head office for each ðivision. The departments are as follows:

Kc Sales
Kc Marketing
Kc Finance
Kc lanning
Kc Controls
Kc Research & ðevelopment
Kc Operations
Kc èuman Resource

There are some shared departments between the two divisions, such as Administration
and Information Technology.

Every department has its own Information System.

The department that we have studied for our project is Sales in the Lays ðivision.
Under the Sales, there are further sub departments. Those are:

÷c Sales
÷c Sales Operations
÷c Sales ðevelopment
÷c Key Accounts
÷c Sales Information System

The Sales department of the Food and Snacks department uses software named as epsi
ðistribution System. It is a Management Information System as it supports the Middle
and Top Level management takes decisions regarding their Store Keeping Units (SKU),
the snacks they produce. The Middle Level Sales and Marketing managers make
different sets of reports based on the data collected through this IS (Information
System), e.g. Sales Analysis, Market Trends, èistory, etc. Initially when the Food and
Snacks division was established in Lahore, they had no proper IS for the Sales
department. Later epsi ðistribution System software was developed to facilitate them.

The Sales Information System sub department is responsible for the operations and
maintenance of this software. This department maintains the entire database of the IS
that supports Sales department.

  


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Uc The previous system being used was not fulfilling the department·s
requirements.
Uc It was unclear in terms of its purpose and structure.
Uc ðue to different pressures, there was always too much work and too little time
for the staff in Sales. And there was no structured software for them to work at.
Uc The Sales department lacked a clear visibility in terms of the number of sales,
number of distributors, trends of sales, etc.
Uc Business was growing by each day and things were not scalable.
Uc Software was needed that kept track of the distributors and their sales.
Uc A link between the distributors and the sales department had to be established.

Thus a solution was required urgently. After justifying financially and culturally to the
Top Level Management, the Sales Information System hired an In-house, contractual
free lancer to develop such a software that eliminated all the problems of the previous
software and fulfilled the requirements of the company. The software was developed
within 4 to 5 months. Some form of rototyping Approach for developing the software
as it was needed on urgent basis. All the modules were not made immediately. The
software cost about $1000. It was less costly than getting it made form a Software
èouse. And the already existing softwares being used at epsiCo were expensive and
the off the shelf options did not cater to all their needs. The best solution at that time
was to get it custom made.
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ðS is a software that connects Lays· distributors with Sales. It runs in real time and can
be used anywhere in akistan by the Sales employees and the distributors. It is a ]eb
based application and can be called an Extranet. It gives access to the employees and
distributors to enter the data onto the database and make further reports on it. The
database is all made on Oracle and è, a ]eb based application language. At the
distributor·s end, it can be called a TS but the at the management·s end it is an MIS.

]hen a new distributor is added to the chain of distributors, the Sales Information
System creates the distributor·s profile under the respective area·s information and a
confirmation email is sent to the distributor. The distributor is given a unique user id
and password. This username allows the distributors to access a specific portion of the
application. Once the distributor logs on to the ]ebsite, a confirmation email is sent to
the Area Sales Manager and Sales Reporting Officer. A link is created between the
respective parties. The distributor is also known as the ðata Entry Operator as he enters
the data and details of the sales made to the distributor of the Store Keeping Units and
of the sales made by the ðata Entry Operator to the local area retailers.

The ðata Entry Operator logs onto the ]ebsite, places the order for e.g. X stock of X
snacks.

The following screenshot shows the log in window of the software.


The system gives a notification to Area Sales Manager that the particular distributor
requires this much of stock. The Manager then selects the distributor and enters the
details of the sales on an invoice of the stock on the application. The stock is the
delivered to the distributor.

Screenshots for Selection of ðistributor and entering the details on the Invoice are as
follows:
Once the distributor receives the stock, he enters its receiving information onto his
profile. èence the details of the sales to the distributors are automatically entered onto
the database and the Sales department has the record of day to day transactions that
take place. At the end of the distributor, the distributor needs to enter information once
the stock is received and also the details regarding the number of stock sold further to
retailers.

Screenshot for the distributor·s Inventory Receipt is as follows:


At the end of each day, the Sales personnel can also check their closing sales through
this software. They can also get the details for the entire month at the end of the month.
Thus, this application has enabled the Sales department to channelize their information
in an appropriate and organized manner.
The above screenshots show the Closing ðay orders Summary and the Closing Month
Summary.
The Information System enables the users such as the Sales team to make a number of
reports based on that data collected through the database. They can generate reports on
ðaily Sales, ]eekly Sales, Monthly Sales, Trend in a particular area, ðistributor ]ise
Sales, Stock Report etc.

The reports include complete comprehensive detail about the stock sold to each
distributor and then further sold to retailers. This helps the Middle level Manager have
a complete overview about the market trends of each and every product of theirs.

The screenshot for the reports page is as follows:


èere are some of the reports generated by the Sales department through the epsi
ðistribution System IS:

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÷c There is structured decision making in the department now.

÷c Business visibility is clear now for the Middle and Top Level Management

÷c It has helped them reduce cost as a lot of the paper work and time lags have been
reduced.

÷c The IS is cost efficient in terms of its development and maintenance.

÷c It caters the need of the hour of the Sales department.

÷c ðS provides a range of reports that assist the management in decision making.
For e.g. it assists the management in taking a decision regarding new schemes to
promote their snacks in different areas given that area·s market trends.

÷c Easily accessible for the personnel and distributors anywhere and anytime.

÷c Sales departments of epsiCo company·s Lay·s ðivision all over akistan can use
the software.
ðrawbacks:

÷c After 3 years of using ðS, the personnel now feel that it lacks flexibility in terms
of the fact that new modules can be added to the current application at the
moment. ]ith the growing needs of the business, the department needs more
flexibility.

÷c The implementation part was a little difficult on the side of the distributors as all
of them may not be educated or trained for the software. Thus, training had to be
given to the distributors and it was hammered in their yearly objectives to input
data.

÷c Limited scope of modification.

Concluding Remarks:

ðS has played a major role in streamlining the information collected by the Sales
department of Lay·s ðivision. It has assisted them in keeping track of each and every
transaction that occurs in the business. It has enabled the ðivision to cut down many of
its initial costs. There is a smooth flow of information throughout the department
because of the software.

èence, it can be said that the IS being used by the Sales department has been successful
in achieving its desired results

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