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Implementing a Management Information System

Chapter No. 1
1.1 Research Aim

The basic purpose of this research is to get knowledge about the implementing a management information system in an organization. Moreover, it judges the convenience of a management information system in an organization in managing the information. By implementing this management information system, the management of information becomes easier for the managers.

1.2 Scope

This project is not a very complicated according to the concepts, but still it is a challenging task for the mangers to implement this system in their organizations. This research is basically depends upon the general ideas and experimentation to resolve problems and get to the faster solutions for managers.

1.3 Research Objectives

  • Appraise critically and review the literature related to the MIS.
  • Make systems according to the mangers requirements that help them to get the information faster and accurate.
  • Make systems that help the managers to search the database quickly.
  • Make the information process system faster for the managers to minimize the time.

1.4 Research Questions

  1. Which are the factors that are affecting the proper working of management information system within the company?
  2. How the management information system can help the managers to take accurate and efficient decisions?
  3. What is the role of management information system in the development and growth of the company?
  4. What are the recommendations to the company to get better use of management information system?


The use of Management Information System in the business organizations is more common. The purpose of the research is to assess the impact of implementation of Management Information System (MIS) to Habib Bank Limited. So the study was conducted to see the MIS affects on the performance of bank after its implementation.


H0: Management Information Systems (MIS) is not an effective tool for the organization.

H1: Management Information Systems (MIS) is an effective tool for the organization.


“HBL was the first commercial bank established in Pakistan in 1947. Over the years, HBL has grown its branch network and become the largest private sector bank with over 1450 branches across the country and a customer base exceeding five million relationships.

The Government of Pakistan privatized HBL in 2004 through which AKFED acquired 51% of the Bank’s shareholding and management control.

With a presence in 25 countries, subsidiaries in Hong Kong and the UK, affiliates in Nepal, Nigeria, Kenya and Kyrgyzstan and rep offices in Iran and China, HBL is also the largest domestic multinational. The Bank is expanding its presence in principal international markets including the UK, UAE, South and Central Asia, Africa and the Far East.

Key areas of operations include product offerings and services in Retail and Consumer Banking. HBL has the biggest Corporate Banking portfolio in the country with a dynamic Investment Banking section. SME and Agriculture lending programs and banking services are offered in urban and rural canters.” (

“With a customer base of 5 million and a network of more than 1,450 branches in Pakistan, HBL is the largest private bank in the country. The network means that bank is geographically closer to its customers than any other bank. This gives the insights needed to provide a variety of products that directly reflect customer needs. Bank remains resolute in the commitment to provide products that are competitive and services that are exemplary.” (

Today, HBL plays a central role in Pakistan’s financial and economic development. It started its operations in Bombay in 1941 with a fixed capital of 25,000 rupees.

Impressed by its primary performance, Quaid-e-Azam Mohammed Ali Jinnah (the founder of Pakistan) asked the Bank to shift its operations to Karachi after the creation of Pakistan. HBL recognized itself in the Quaid’s city in 1943 and became a symbol of pride and growth for the people of Pakistan.


Management Information System is a system that provides people with either data or information related to an organization’s operations. MIS support the activities of employees, owners, customers and other key people in the organization’s environment – either by efficiently processing data to assist with the than section work load or by effectively supplying information to authorized people in a timely manner.

A management information system (MIS) is the collection of system, both computerized and manual, that provides information about on going activities to an organization’s decision makers.

The management information system of Habib Bank Limited has following major divisions:

* Transaction Processing System

* Management Reporting System

* Decision Support System

* Office Information System.


Transaction processing system supports the processing of Habib Bank Limited by automating the process of voluminous amounts of paperwork that must be handled daily. These systems include accurate recording of daily Transactions, controlling the procedure of issuance e.g. issuance of pay cheques invoices, customer statements, payment remainders, tuition bills and employee schedules etc.

1.10 Transaction Processing Functions

There are three steps of processing a transaction.

1.10.1 Book Keeping

First of all accurate record of transaction is recorded e.g. recording the deposits or withdrawals of account holders. This recording of transaction is called Book Keeping involving applications of financial accounting.

1.10.2 Issuance

It refers to the production of pay cheques, invoices, periodic statements as monthly telephone bills, credit card bills and payment remainders etc.

1.10.3 Control Reporting

Reports that are produced as a by product of transaction processing operation and that also serves operation control purposes are called control reports, as pay cheques are of Habib Bank are produced in batches, like wise the payroll edit report is produced to show the pay scheme of employees.


Management Reporting System is an information system that provides predefined types of information to management. At Habib Bank Management Reporting System is used not only in management planning but also in managing the control system.

1.12 Properties of Management Reporting System
1.12.1 Support

Management Reporting System supports structured and semi-structured decision, primarily at the middle-and lower-management levels.

1.12.2 Provision of Information

Management Reporting System Provides fixed types of information, in an established format; the formation requirements of users are normally known and stable.

1.12.3 Nature of Management Reports

Often implemented with voluminous, hardcopy reports, requiring each user to search specifically for key’ information. Frequently require a formal request to be submitted; formal systems development may be required to approve the request.

1.12.4 Data

It has usually consisted of internal operational data, rather than data about the external environment. It concerned with data about the past than data relating to the future.


It is a system that provides tools to managers to assist them in solving semi-structured and unstructured problems in their own somewhat personalized way. At Habib Bank decisions are only taken by Board of Directors otherwise usually predefined decisions are there for managers to follow.

1.14 Properties of Decision Support System of Habib Bank


1.14.1 Support

Decision Support System supports semi-structured or unstructured decision-making.

1.14.2 Flexibility

The Decision Support System of Habib Bank is flexible enough to respond to the changing needs of decisions makers.

1.14.3 Application Way

Decision support system of Habib Bank is easy to use.

1.14.4 Fastness

Decision Support System is fast in responding with a high degree of user control and interaction.

1.15 Types of Decisions Taken
1.15.1 Unstructured Decisions

This is the decision for which information provided by computer or men is not complete but is a small portion of the total knowledge required to make a decision.

1.15.2 Semi-structured Decisions

The decision made under a condition in which the information about problem to be solved is not complete is called semi-structured decision.


The combination of new technologies as hardware, software, facsimiles e-mails and the people availing their services makes the office information system.

1.17 Components of Office Information System of Habib Bank

There are 3 major components of Office Information System, Document Management System, Message Handling System, and Office Support System.

1.18 Document Management System of Habib Bank

Document Management System of Habib Bank is partly manual and partly computerized.

1.19.1 Reprographic System

In each branch of Habib Bank Reprographic machines are there for making copies of required documents.

1.19.2 Word Processing System

At Habib Bank the office system technology which is used is word processing involving hard ware and soft ware tools which allows computer system to operate.

1.20 Message Handling System of Habib Bank

It is one of major applications of Office Information System. At Habib Bank the message handling system is of following.

1.20.1 Facsimiles

Fax machines are there to receive and send faxes in other branches of Habib Bank.

1.20.2 Electronic Mail

Electronic mail is used to receive and send messages to other branches.

1.21 Office Support System

Many applications collectively help in working of groups, which are known as Office Support System.

1.22 Office Support System of Habib Bank
1.22.1 Group Ware

Habib Bank provides group ware in following ways.

1. Word processing services.

2. Using fax mails.

3. Availability to on- line Data.


Activity of account opening and deposit department are the followings:

a) Opening new accounts.

b) Maintain of deposits of the account holders.

c) Processing can stop payment instructions.

d) To give fresh cheque books.

e) To make amendments in the existing accounts.

f) Closing the accounts of accounts holders (if required).

Almost all the activities mentioned above are performed through computer. The computer maintains all records of each and every client. Vouchers have been prepared and send to the MIS department for daily transactions and making changes in customer’s accounts.


The major functions of cash dealing departments are:

a) Cash receipts.

b) To cash cheques.

All the regarding date, account number, tile of account, balance of account holder and the signature of customer have been verified through computer.


The major functions performed by remittance department are:

a) Pay order.

b) Demand like drafts on need.

c) Post transport.

d) Telegraphic transfer.

Fax and telephone are the major source of performing such activities.


Three major functions performed by the import department:

a) L/C opening.

b) Lodgement of papers and documents.

c) Retirement of papers and documents.

Import department is considered to be one of the most important departments of the bank. It handles the import licensing and imports of merchandise.

Imports can be separated into two categories:

a) Industrial Imports.

b) Commercial and industrial Imports.

Export Promotion Bureau makes registration of imports, Document required for sole proprietor partnership concern and limited concerns are different.


Export is a major source of earning foreign exchange. Every country wants to increase its exports because the foreign exchange earned through exports can help in meeting the other needs of the countries.

The computer keeps the records of each and every dealing which has been made by the customer for import export purposes. The records concerning his past and present performance and balance of accounts helps to make further decisions whether to give him loan or not.


Personal department uses computer for smooth functioning of work. The main functions performed by Personnel Department of Habib Bank are:

a) Selection and recruitment.

b) Training and growth.

c) Job explanation and estimation.

d) Periodic review

e) Communication


Consumer satisfaction is the first and for most priority for the bank. The marketing management makes policies for the better services of satisfaction of consumer. The process includes:

a) Finding out consumer wants and needs through marketing research.

b) Finding possibilities and then development of those wants and needs.

c) Establishing meaningful relations with customers.

d) Improving of product development for customers.

It is also the function of the organization to keep in constant contact with the consumer, read their needs, developed the product that can fulfil their needs and build the aim that express organizational purpose. Bankers also try to locate their past customers for offering more facilities to them. The computer provides every past and present updated account of each customer.

Chapter No. 2

2.0 A System for obtaining Management Information

“To get the better speedy management information, management may either use the services from a computer bureau, or they store their own computerized system.”(David Freestone).

2.1 Establishment of Management Information Systems

“Technology is improving the speed and reliability with which information is passed not only around the individual organization but also around the globe, and `dramatic reductions in the cost of obtaining, processing and transmitting information are changing the way we do business.” (Porter and Millar, 1991).

“Technology can assist those small firms that use these new technologies not only for data storage and transmission, but also to differentiate their products or to attack new market niches. The implementation should be handled by the team who will be able to handle key tropical areas.” (Nancy and Peter 2003).

2.2 Role of Management Information System

“Basically a management information system is depending upon other independent systems which are working in a combination to provide proper management information and transformed information. By recognizing the data that what information managers required to manage the organization is a starting point for making a proper information system.” (Tony Hines, 1995).


“The prospect of wholly independent status for South Bank Polytechnic in the late 1980s, responsible for its own finance, property and personnel, gave considerable motivation towards improving management structures and information systems. In the Peat Marwick McLintock analysis, the overall management information wants the Polytechnic recognized the interrelationship of five information sources: staff, students (enrolment and applications), resources (finance), space and curriculum. The Management Information System under development reflects this with an additional component called Performance Indicators, which is generated within the system.”(Perry P, Payne C, Geddes T (1991).


“According to Kenneth C. Laudon and Jane Price Laudon mentioned in their book Management Information Systems: A contemporary Perspective, an information system is a set of procedures that collects (or retrieves), processes, stores, and disseminates information to support decision making and control. In most cases, information systems are formal, computer-based systems that play an integral role in organizations. Although information systems are computer based, it is important to note that any old computer or software program is not necessarily an information system.” “Electronic computers and interrelated software programs are the technical foundation, the tools and materials, of modern information systems,” Laudon and Laudon wrote. “Understanding information systems, though, requires one to understand the problems they are designed to solve, the architectural and design solutions, and the organizational processes that lead to these solutions.”

2.5 Systems Development

“The development of effective information systems holds a number of challenges for small businesses. Despite, or perhaps because of, the quick 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 frequently cannot be programmed to take into account participant responses to marketing strategy or changes in economic conditions, among other things. Adding up, the worth of information erodes over time, and rapid changes in technology can make systems become outdated very quickly. In conclusion, many companies find systems development to be problematic because the services of skilled programmers are at a premium.

The momentum to develop a new information system can grow up of end-user demands, the availability of new technology, or management strategy. A range of tools exists for analyzing a company’s information requirements and designing systems to support them. The fundamental process of systems development involves defining the project, creating a model of the current system, deriving a model for the new system, measuring the costs and benefits of all alternatives, selecting the best option, designing the new system, completing the specific programming functions, installing and testing the new system, and completing a post-implementation audit.

“The organization must develop a technique for ensuring that the most important systems are attended to first, that unnecessary systems are not built, and that end users have a full and meaningful role in determining which new systems will be built and how, ” according to Laudon and Laudon. (Thomson Gale, 2002)


“A management information system for planning enables the corporation to have a central facility where large amounts of information can be gathered and stored. The information can be quickly retrieved and updated to help managers in making decisions. The management information system is capable of evaluating more alternatives than manual methods, can make superior and quicker decisions and provides timely and accurate information for decision making. Possibly if more companies are able to entirely put together the finance, marketing, production and human resources functions into an incorporated corporate simulation model, they will be better able to find out the effects that changes in internal or external phenomenon will have on their organization.” (Sethi NK, 1978)


Management information systems, like programming languages (e.g., ALGOL 60), which were originally regarded as quite universal, ceased to satisfy their creators at a certain stage of development. The disillusionment was due to the increase in accumulated knowledge, skills, and experience, to advances in hardware and software, and to the ever-expanding range and diversity of the relevant tasks.

Although the basic requirements and the underlying design principles were universally agreed upon since the early development of MIS, both theoreticians and practitioners were satisfied with partial realization of these requirements up to a point. At the present stage, however, no one can remain satisfied with the prevailing state of affairs, either organizationally or professionally.

Just complex MIS incorporating all the fundamental properties of the relevant objects, with their applications and interactions can hope to be effective. The development of such MIS requires using the latest advances in science and technology and instituting crash programs for the solution of the complex problems that arise in the design process.


“Information is a critical resource in the operation and management of organizations. Well-timed availability of appropriate information is essential for efficient performance of managerial functions such as planning, organizing, leading, and control. An information system in an organization is like the nervous system in the human body, it is the connection that links all the organization’s components together and provides for better operation and survival in a competitive environment. Indeed, today’s organizations run on information.” (Babu AR, Singh YP, Sachdeva RK)

2.9 Basic Concepts
2.9.1 Data versus Information

Data refers to raw, unevaluated facts, s, symbols, objects, events, etc. Data possibly will be a collection of facts lying in storage, like a telephone directory or sample records.

The information is data that have been set into a meaningful and helpful background and communicated to a receiver who make use of it to make decisions. The information involves communication and reception of intelligence and knowledge. This appraises and notifies surprises and stimulates, reduces ambiguity, reveals additional alternatives or helps eliminate irrelevant or poor ones, and influences individuals and stimulates them to action. An element of data may constitute information in a specific context; for example, when we want to contact our friend, his or her telephone number is a piece of information; otherwise, it is just one element of data in the telephone directory.

The computers have made it easier to process functions. Huge quantities of data can be processed rapidly through computers assisting in the conversion of data to information. Raw data go into the system and is changed into the output of the system. And this information supports managers in the decision- making.

2.9.2 Characteristics of Information

The characteristics of good information are relevance, timeliness, accurateness, cost-effectiveness, dependability, usability, exhaustiveness, and aggregation level. Information is related if it leads to superior decision-making. It may be relevant if it reaffirms a previous decision. If it not then it is not relevant.

The timeliness represents money of information accessible to the users. The currency of data and information is time hole between the occurrences of an occasion in the field until its presentation to the user (decision maker).

Accurateness is considered by comparing data to genuine procedures. The value of correct data varies with the kind of decisions that need to make. Though, a general estimation of how much personnel time was dedicated to a particular activity may be all that needed.

2.9.3 Value of Information

Information has a great impact on decision-making, and hence its value is closely tied to the decisions that result from its use. The information not has a complete common value. This value is linked to that use it, when it is used, and in what situation it is used. Information is like other commodities. For illustration, value of a glass of water is different for someone who has lost his way in arctic glaciers than it is to a wanderer in the Sahara desert.

The information supports decisions, decisions activate actions, and events affect the achievement or performance of the company. If it measures the difference in performance, it can be traced the impact of information, provided that the measurements are carefully performed, the relationships among variables are well defined, and possible effects of irrelevant factors are isolated. The calculated difference in performance due to informational factors is called the realistic value or revealed value of information.

“For most information systems, mainly those supporting middle and top management, the consequential decisions often relate to events that are not severely defined and involve probabilities that cannot be quantified. The decision-making process often is difficult to understand and the outcome are scaled by several and incomparable dimensions. In such cases, we may either attempt to perform a multi-attribute analysis or derive an overall subjective value. The subjective value reflects people’s comprehensive impression of information and the amount they are willing to pay for specific information.” (Ahituv N, Neumann S, Riley HN, 1994)

2.9.4 Information as an Aid to Decision Making

“The process of decision making as comprising four steps: intelligence, design, choice, and review. The intelligence phase encompasses collection, classification, processing, and presentation of data relating to the organization and its environment.” Simon (1977). This is essential to recognize situations calling for decision. Throughout this decision stage, the decision maker outlines substitute solutions, each of which involves a set of actions to be taken. Statistical and other models to forecast possible outcomes for each alternative now use the data collected during the intelligence stage. Every alternative can also be examined for technological, behavioral, and economic feasibility. In the choice stage, the decision maker should select one of the alternatives that will best donate to the goals of the organization. Previous choices can be subjected to review during the implementation and monitoring to enable the manager to learn from mistakes. Information plays a vital role in all four stages of the decision process. -I indicates the information requirement at each stage, along with the functions performed at each stage and the feedback loops between stages.

2.10 Conceptual Framework

Research Question


Questionnaire questions

Which are the factors that are affecting the proper working of management information system within the company?

(M-MIS, (1995),

Risks Associated With MIS.

Do you think that employees are needed to be sufficiently trained for new systems and subsequent enhancements?

Do you agree that the company is satisfied with the development of user manuals and testing of the system?

How the management information system can help the managers to take accurate and efficient decisions?

Simon (1977),

Information as an Aid to Decision Making

Does management has any policy to monitor the new MIS?

Has your management developed and maintained a current MIS policy or practice?

What is the role of management information system in the development and growth of the company?

Tony Hines (1995), Role of Management Information System.

Do you think MIS is an effective tool for the company?

Does the internal planning process consider and incorporate the importance of MIS at both the strategic and tactical level?

What are the recommendations to the company to get better use of management information system?

Masood SH, Pires CG (2005) SH, Management information system for better team productivity.

Does management encourage communication lines to link all MIS user effectively?

Does management use a project management technique to monitor MIS development schedules?

Does Company update MIS regularly?




1. Has your management developed and maintained a current MIS policy or practice?


Percentage (%)










Result shows that out of 130 respondent 45(34.6%) said that their management has developed and maintained a current MIS policy or practice while 85(65.4%) said that their management has not developed and maintained a current MIS policy or practice.

2. Does MIS policy or practice provide guidance to company employees to achieve their purposes?


Percentage (%)










Out of 130 respondents majority 75(57.7%) said that MIS policy or practice provide guidance to company employees to achieve their purposes and 55(42.3%) said that MIS policy or practice does not provide guidance to company employees to achieve their purposes.

3. Do you believe that MIS policy or practice provide enough guidance to achieve effective two-way communication between management and employees?


Percentage (%)










80(61.5%) respondents said they believe that MIS policy or practice provide enough guidance to achieve effective two-way communication between management and employees while 50(38.5%) were not agreed with it.

4. Do you believe after implementation of MIS System Company’s staffs performs well in initiating, developing and completing their jobs?


Percentage (%)










Result shows that out of 130 respondents 75(57.7%) said that they believe after implementation of MIS system company’s staff performs well in initiating, developing and completing their jobs while 55(42.3%) said no.

5. Do you think that MIS policy or practice provide enough guidelines for installing MIS enhancements in a controlled change environment?


Percentage (%)










Result depicts that out of 130 respondents 95(73.1%) said that MIS policy or practice provide enough guidelines for installing MIS enhancements in a controlled change environment while 35(26.9%) respondents were not agreed with it.

6. Do you agree that MIS policy or practice is helpful in acquiring, merging, manipulating and up-loading data to other systems?


Percentage (%)










Above table shows that out of 130 respondents 85(65.4%) said that MIS policy or practice is h

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