Question

Explain, using examples, the relationship between the organisational MIS and the other functional information system in an organisation. Describe how AIS receives and provides information to other functional MIS.

Answer 1

MIS is a planned system of collecting, processing, storing and disseminating the data in the form of information to perform the task of decision making and management of an organisation. An organisation basically operates in an environment, which is surrounded by its suppliers and customers. The informational needs of the organisation emerge from the business processes stratified into its various functional areas. Thus, in this sense, MIS has functional relationship with other functional management information system namely Manufacturing Information System, Human Resource Information System, Accounting Information System and Marketing Information System. MIS receives information from these other functional information systems and uses the received information to take appropriate decisions.

An Accounting Information System (AIS) is a system that identifies, collects, processes, summarises, generates and presents information about a business organisation to a wide variety of users. It is an important component of MIS. It receives and provides information to the various sub-systems of the MIS.

Relationship between AIS, Manufacturing Information System and Human Resource Information System

The Human Resource Department sends a list of workers to the Manufacturing Department. The Manufacturing Department on the basis of this information prepares a report on the performance of each worker and deductions to be made from the wages, if any. Thereafter, this report is send to both Accounts Department as well as to Human Resource Department. After this, the Human Resource Department sends report to the Accounts Department to pay the wages. The Accounts Department with the help of these reports calculates the amount payable and statutory dues and subsequently, makes the final payments to the workers. The report of the final payments is send to the HR Department and the Manufacturing Department by the Accounts Department.

Relationship between AIS and Manufacturing Information System- Business processes in the Manufacturing Department include the following activities.

a) Preparation of Plans and Schedules

b) Issue of Material Requisition Form and Job Cards

c) Issue of Stock and Inventory

d) Issue of Raw Material Procurement Orders

e) Handling Supplier Invoices

f) Payments to Suppliers

The AIS would accordingly include the process of

a) Purchasing Orders

b) Payments to Suppliers

c) Preparing Inventory Status Reports

d) Preparing Reports of Accounts Payable

Relationship between AIS and Marketing Information System- Business processes in the Marketing and Sales Department involve the following activities.

a) Inquiry Process

b) Creation of Contacts

c) Entry of Orders

d) Dispatching Goods

e) Generation of Bills to Customers

The AIS would accordingly include the following activities.

a) Processing of Sales Orders

b) Authorisation of Credit

c) Keeping Custody of the Goods

d) Inventory Status

e) Shipping Details