The role of management information systems in decision making

Quick access to information #

Managers need quick access to information to make decisions on strategic, financial, marketing, and operational issues. Companies collect vast amounts of information, including customer profiles, sales data, market research, financial records, production and inventory data, and human resource records. However, much of that information is kept in separate departmental databases, making it difficult for decision makers to access the data quickly.

Management information systems simplify and speed up information retrieval by storing data in a central location accessible over the network. The result is faster and more accurate decisions.

“Selective Timely” It can be said that the top criteria of managers when making decisions, the work of business management is largely about making accurate decisions, that decision must be timely and selective. You cannot do this without a management information system.

Decisions based on the latest information #

A management information system gathers data from inside and outside the organization. By establishing a network that links a central database with retailers, distributors and members of the supply chain, companies can collect sales and production data on a daily basis or more often and make decisions based on the latest information.

Make it possible for departments to work together #

In situations where decision making involves departments, groups as well as individuals, management information systems make it easier for teams to make collaborative decisions. For example, in a project team, the management information system allows all members to access the same essential data, even when they are working in different locations.

Interpret results effectively #

Management information systems help decision makers to make sense of their decisions. The system collates raw data into reports in a format that allows decision makers to quickly identify patterns and trends where raw data would not be obvious.

Decision makers can also use management information systems to understand the potential impact of change. For example, a sales manager can make predictions about the effect of a price change on sales by running simulations in the system and asking some “what if price” questions. .

Presentable and persuasive #

The reporting tools in management information systems allow decision makers to tailor reports to the information needs of other parties. If a decision requires the approval of a senior executive, the decision maker can create a brief executive summary for review. If a manager wants to share the report's detailed findings with colleagues, they can create a full report and provide different levels of additional data.

A decision of a decision maker has the support of the company's team or not largely due to the persuasiveness of that decision, the persuasiveness of the decision cannot be explained in words but must be expressed through information. Numbers are presented in a clear, understandable way to accurately describe the information the decision maker wants to convey. This is decided by the enterprise's Management Information System.