Introduction

Management information systems (MIS) are fundamental for public sector organisations seeking

to support the work of managers. Yet they are often ignored in the rush to focus on ‘sexier’

applications. This paper aims to redress the balance by providing a detailed analysis of public

sector MIS. It firstly locates MIS within the broader management monitoring and control

systems that they support. Understanding the broader systems and the relationship to public

sector inputs, processes, outputs and outcomes is essential to understanding MIS. The paper

details the different types of reports that MIS produce, and uses this as the basis for an MIS

model and a description of the decision-making benefits that computerised MIS can bring.

What is Management Information System (MIS)?

A management information system (MIS) is an information system used for decision-making,

and for the coordination, control, analysis, and visualization of information in an organization

(Bourgeois & David, 2014). The study of the management information systems involves people,

processes and technology in an organizational context (Saunders College of Business, 2017;

Mays Business School, 2015). In a corporate setting, the ultimate goal of using management

information system is to increase the value and profits of the business.

Types

The following are types of information systems used to create reports, extract data, and assist in

the decision making processes of middle and operational level managers.

i. Decision support systems (DSSs) are computer program applications used by middle and

higher management to compile information from a wide range of sources to support

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 problem solving and decision making. A DSS is used mostly for semi-structured and

unstructured decision problems.

ii. Executive information system (EIS) is a reporting tool that provides quick access to

summarized reports coming from all company levels and departments such as accounting,

human resources and operations.

iii. Marketing information systems are management Information Systems designed

specifically for managing the marketing aspects of the business.

iv. Accounting information systems are focused accounting functions.

v. Human resource management systems are used for personnel aspects.

vi. Office automation systems (OAS) support communication and productivity in the

enterprise by automating workflow and eliminating bottlenecks. OAS may be

implemented at any and all levels of management.

vii. School Information Management Systems (SIMS) cover school administration, often

including teaching and learning materials.

viii. Enterprise resource planning (ERP) software facilitates the flow of information between

all business functions inside the boundaries of the organization and manage the

connections to outside stakeholders (Bidgoli & Hossein, 2004).

ix. Local databases, can be small, simplified tools for managers and are considered to be a

primal or base level version of a MIS.

THE IMPORTANCE OF MIS

The Importance of MIS in public administration can include the following:

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1. It allows real-time performance reports

By receiving performance reports in real-time, the organisation can become more dynamic in its

operations. Its employees may be able to discover and respond to opportunities more quickly.

They may also be able to detect potential threats and find appropriate solutions to avoid or

minimise them. Additionally, when everyone is better-informed about the business operations

and long-term results, their work productivity may improve.

2. It generates analytical reports

The principal function of MIS is to organise and analyse data and use it to generate informative

reports. With these reports, the organisation's management can monitor its performance and

identify new business opportunities. They can formulate plans to improve the organisation's

processes and increase its production efficiency.

3. It compares projections and performances

Organisations regularly set business goals and make business and financial forecasts, but they

need to monitor their effectiveness. For that, they must compare them with actual performances.

An MIS facilitates performance reviews and accurate comparisons with the projections. That can

enable the management to make better business decisions.

4. It aids the work allocation process

With an MIS information system, the organisation's management can make better decisions

concerning the allocation of staff and resources. They can review the performance reports of

individual employees and departments and identify the best performers. To enhance work

productivity and get better business results, they can transfer the best employees to the high-

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performing departments. They can also arrange for training programmes to improve the

performances of the employees and departments that have not been doing as well.

5. It improves internal communication

It can facilitate communication between different employees and departments of the

organisation. They can share relevant and timely business information, particularly about

interdepartmental work. That can prevent work delays or misuse of resources due to any

misunderstanding or lack of discussion. For instance, when two departments require different

parts or materials that the organisation must order from a foreign supplier, it is more convenient

and economical to place an order together, rather than separate orders that could cause delays in

arrival.

Examples of Management Information Systems

Management information systems can be introduced to support a variety of public sector
applications, as described below.

Internal Transaction-Based MIS

Three main types of management information system fall into this category: accounting, human
resources, and 'other'.

i. Accounting MIS
Far more than anything else, the emphasis of public sector MIS has been on money: on
monitoring how much has been spent; on comparing this with budget; and on controlling
expenditure to bring it in as close as possible to budget at year-end. Examples of this type of
computerisation range from the Kenyan Ministry of Agriculture (Pinckney et al., 1987) to major
US regulatory agencies (Brown, 1999).

Typical reports include:

 Statements of account: month-end, year-end, year-to-date, etc.; these will generally have to be
designed to fit with existing regulatory or legislative standards for public sector accounting.

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 Warnings of budget head over- or under-spend against target; variance from planned budget
can be shown either in absolute or in percentage terms.
 Statements of cash requirements in the month ahead based on payments still owed within
accounts payable data.
Payroll often represents the main cost for public sector organisations. It has therefore been a
starting point for MIS in many organisations, looking to monitor and control salary and income
tax payments, and also to issue payments. One focus for payroll MIS in some countries has been
to identify and then eliminate 'ghost workers', who do not exist but whose pay is fraudulently
collected by other employees. Cain (1999) describes the importance of this approach in the
creation of MIS for the governments of Ghana, Uganda and Zimbabwe. Examples of payroll
reports were described above.

An example of a typical accounting MIS report is shown in Table 1.

Table 1: Accounting MIS Report Example

Accounting Report

Department of Land Management

Year-to-date, end September 1999

Expenditure Budget Actual Variance Variance

Head (US$) (US$) (US$) (%)

Salaries 275,900 291,400 15,500 5.6%

Wages 241,200 248,000 6,800 2.8%

Office 113,600 141,600 28,000 24.6%

Equipment

Utilities 88,500 84,500 -4,000 -4.5%

Transport 69,300 69,300 0 0%

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 Consumables 54,900 63,800 8,900 16.2%

Other 127,100 131,100 4,000 3.1%

TOTAL 970,500 1,029,700 59,200 6.1%

The MIS reporting Table 1 has been instructed to highlight all variances greater than US$10,000
and all variances greater than 5 per cent. Rationally, in attempting to control the overspend
indicated, management priority would be given to those items highlighted in both columns.

This form of accounting report, based on responsibility for particular budget heads, is widely
used in the public sector. Some public sector organisations, especially those providing public
services, have developed cost accounting MIS. These aggregate costs horizontally as they are
incurred in the delivery of a service. They therefore require allocation of labour and other costs
to particular services during the entire process of providing that service.

This is often difficult but can provide very valuable information in helping to assign a value or
cost to a public service, and in comparing costs between public service providers. The British
public sector National Health Service, for example, has been creating management information
systems that can report health care provision costs down to the level of individual patients. This
allows better-informed decisions about prioritising the use of scarce resources. It also allows
health units to compare their costs with other units (HSMU, 1996).

Income-related MIS are the exception rather than the rule in the public sector. MIS are found,
though, reporting on:

 Loans and loan repayment. For example, to report those applicants who have been waiting for
more than one month to know if their loan application has been granted.
 Customer payments where cost recovery operates in health, education and other social welfare
provision. For example, to report those public hospitals which have recovered most and least
per patient treated.

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 Customer payments to public sector utilities, transportation, rented housing, and enterprises.
In these cases, the MIS are likely to be building upon some form of accounts receivable
transaction processing system. For example, to report those customers whose accounts remain
outstanding 60 days after bills for provision of utility services were issued.
ii. Human resources MIS
Management information systems are used in the entire human resource lifecycle from
recruitment to termination or retirement. Reports include:

 Vacancies: for example, a detail report on all vacant posts in the organisation.
 Recruitment and selection: for example, a summary report on the ethnic origin and sex of all
job applicants and recruits for use in equal opportunities monitoring.
 Staff performance: for example, an exception report on only those secretarial staff who are
able to take shorthand dictation and type at over 50 words per minute.
 Payroll: examples have already been given.
 Training: for example, an ad hoc report on all those staff who have received training in gender
awareness.
 Staff promotion: for example, a detail report on all performance assessments for a potentially-
promotable member of staff.
 Staff departure: for example, a comparative report on turnover rates and reason for departure
in the information systems and accounting departments.
 Pensions: for example, a summary report on recent annual pension fund growth rates.
 Other: for example, a comparative report on workplace accident rates on different days of the
week; this and other categories may relate to government reporting and compliance.
The State of Vermont in the US developed a human resources management information system
(albeit both over-time and over-budget) that covered a number of these reporting functions (Cats-
Baril & Thompson, 1995). Similar experiences are reported in the development of a personnel
information system with MIS capabilities for Northamptonshire County Council, a local
government body in the UK (Palmer, 1993).

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iii. Other MIS
Public sector inventory information systems tend to be relatively basic and/or automated. The
aim of an inventory MIS is to monitor stock levels and to control stocks to ensure that all items
are neither over- nor under-stocked.

MIS may also report on other entities such as fixed assets, financial investments and projects.
One US regulatory agency, for instance, set up an MIS covering its major facilities in order to
monitor, control and then reduce expenditure on those facilities, as requested by Congress
(Brown, 1999).

MIS may also combine the functional areas described above. The British Department of Social
Security, for instance, has proceeded with development of an integrated MIS covering financial,
personnel and resource management (Bellamy & Henderson, 1992).

Public Administration and Regulation MIS

Management information systems have been created to support the whole range of public
administration and regulatory activities. In the US, for example, the National Drivers Register
has MIS facilities to report on driver licence details, such as all those within a given state whose
licence has been revoked or suspended (Danziger, 1991). Similarly, the US Environmental
Protection Agency is pushing forward in use of MIS to help monitor and control environmental
risks (Sparrow, 1992). Just a couple of other examples are provided here.

i. Buildings registration MIS

Based on data recorded about particular types of buildings, or buildings in a particular locality,
this could monitor building ownership and use, and produce reports on, for instance:

 all details of one individual building (building code, address, description, owner, floor space,
utility connections, local tax liabilities, etc.),
 annual growth in the total number of small industrial units in major cities, or
 all buildings within one city block for which no ownership records were lodged.
Japan’s registration MIS has these types of uses in mind. It was begun in earnest in 1988 as a
20-year project, and will eventually cover some 40 million buildings and 230 million parcels of
land (Snellen, 1991).

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ii. Taxation MIS
Based on data recorded about individual tax-paying entities (whether individuals or
organisations), this could monitor the payment of taxation, and produce reports on, for instance:

 all details of an individual tax payer (payer code, name, address, employment, employer, tax
code, record of assets, record of recent tax payments and liabilities, etc.),
 a summary of sales tax receipts broken down by sector,
 patterns of non-payment in order to target enforcement efforts more effectively, or
 the names and addresses of all those registered on public or private payrolls as tax payers who
are also claiming social welfare payments.
The State of New Jersey in the US used the last of these report types to identify welfare cheats
and to generate ‘estimated savings of $45 million in the first two years of operation’ (Danziger,
1991:175).

Public Service Delivery MIS

Many public service providers have developed management information systems to monitor and
control the services that they provide. Both the US and UK Social Security agencies have
developed MIS to report on the welfare payments and services that they provide (Danziger,
1991; Bellamy & Henderson, 1992). The British public healthcare system has also been a major
investor in MIS as it tries to control healthcare costs and simultaneously improve delivery
standards (HSMU, 1996; Ballantine & Cunningham, 1999). One further example is provided
here.

i. Education sector MIS for schools

Based on data gathered from individual schools and from other educational institutions such as
exam boards and school inspectorates, this could monitor the provision of education and produce
reports on, for instance:

 details of one individual school (school code, name, address, location, staff numbers, student
enrolment by year, annual budgets, school facilities, examination grades, etc.),
 a summary of the average staff:student ratio for each state, or
 the name and location of all schools without on-site sports facilities.
An example of a typical school MIS report is shown in Table 2.

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Table 2: Public Service MIS Report Example

Performance Report

Department of Education

Change in High School Examination Performance, 1998-99

School 1998 Average 1999 Average Percentag

Exam Grade Exam Grade e Change

Jacobson 45.3 51.5 13.7%

Chaparral 63.7 66.9 5.0%

Tomoroon 58.8 61.7 4.9%

Beaunine 49.8 51.3 3.0%

Burndale 51.5 47.9 -7.0%

Cheyenne 56.2 46.2 -17.8%

AVERAGE 54.2 54.2 0%

The MIS reporting Table 2 has been instructed to present the schools in decreasing order of
percentage change and to highlight all percentage changes of more than 10 per cent. Those
raising their average grades by more than 10 per cent might be the focus for special attention to
learn how they achieved this (or to probe for exam fraud!). Those with averages falling by more
than 10 per cent might be prioritised for external assistance or inspection.

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Individual schools can also make use of MIS. Hobmoor Junior and Infant School, a public school
in Birmingham, UK, introduced a computerised attendance system to produce MIS reports that
monitor pupil attendance. This improved the Principal’s ability to understand and control
absence patterns, resulting in a 2.5 per cent increase in attendance rates (Capita, 1998).

Advantages and disadvantages of MIS

The following are some of the benefits that can be attained using MIS: (Management Association

International Conference, 1995)

i. Improve an organization's operational efficiency, add value to existing products,

engender innovation and new product development, and help managers make better

decisions (Saunders College of Business, 2017).

ii. Companies are able to identify their strengths and weaknesses due to the presence of

revenue reports, employee performance records etc. Identifying these aspects can help a

company improve its business processes and operations.

iii. The availability of customer data and feedback can help the company to align its business

processes according to the needs of its customers. The effective management of customer

data can help the company to perform direct marketing and promotion activities.

iv. MIS can help a company gain a competitive advantage.

v. MIS reports can help with decision-making as well as reduce downtime for actionable

items.

Some of the disadvantages of MIS systems:

I. Retrieval and dissemination are dependent on technology hardware and software.

II. Potential for inaccurate information.

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 CONCLUSION

Information systems are very important in the current world where technological developments

have become a part of every day life. They have become of great relevance to the public

managers who are faced with a lot of bulky and tedious work that needs to be processed either

for decision-making purposes or for dissemination to the relevant parties such as public and

interest groups.

Information systems help public managers in financial management. Data is entered into the

computer and with a number of commands using the appropriate software; they are able to

generate information required within a short time. They have made information flow to be easy

and smooth within organization and therefore promoted effectiveness and efficiency in overall

information.

However, they call for considerable investment and careful analysis should be done in terms of

costs and benefits before a decision is made on the type of information system to put in place.

The managers should observe that information generated possess good qualities such as

reliability, relevance, consistency, and comparability among others.

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