The Role of Management Information System in Business Organizations

Information systems have changed the way we collaborate and work in significant ways.


Information systems refer to a network of hardware and software applications which complement each other in the display, collection, classification, transformation, storage, retrieval, communication and processing of data. This makes it possible for organizations to make informed decisions regarding their operations based on the evidence provided from data. This organization of data has significantly changed the way individuals and organizations work and collaborate. This is because through information systems individuals and organizations are able to approach issues differently from the tradition means of decision making where decision making were made based on personal judgements and convictions. In order to understand the role of information systems in shaping the way people collaborate and work, it is important to approach the issue using various concepts of information systems. In this paper, we will use the concept of technology of information and communication and the role of socio-technical systems in organizations.

Information, Technology, Communication and networks

Networks can be viewed as mechanisms of governance which entail coordinative alternative or complementary of formal organizations. This involves managerial practices which highly rely on information and result in production and distribution of goods and services (Kallinikos, 2006). It is therefore necessary to develop information management process so as to initiate a supplementary pool of operations that result in the management of the processes of goods and services’ production and distribution.

Information systems have led to the diffusion of technologies in information and communication as well as the internet into these networks.

Information and communication technologies have a big role to play in organizational structures, promotion of new distributed modes of work and outsourcing of information-based tasks and services. Since the invention of computer-based information systems, there have been changes in the way goods and services are produced. In other words, organizational operations change substantially as a result of information systems (David, 1990). Information systems also result in new tasks in organizations. Information systems often lead to new efficient and less costly modes of communication across functional units within an organization. This in turn affects the governance and structure of organizations. Information system therefore leads to restructuring of organizations. Restructuring of organization often weakens its boundaries. In this case, the company’s operations are executed extensively in liaison with other actors in the company’s external environment.

Generally, it may be argued from this point of view that information systems transform an organization’s bounded, hierarchical and formal structure into alternative forms in which networks form part. Put in other words, information systems may be said to have resulted in emergence of networks (Kallinikos, 2006). Organizations and individuals get the opportunity to network with the external environment.

The second role of information and communication technologies that affect an organization’s operations is the diffusion of distributed work methods. Distributed work methods limit the role of a location as the central element of control within an organization.  Location played its primary role in the historical work methods where oral and faces to face communications were the key elements of communications within an organization. Distributed work therefore weakens the role played by hierarchical control mechanisms. It creates a multiple feedback loops which interfere with the hierarchical control within the organization.

It is also argued that the internet and information and communication technologies lead to the development of outsourcing and subcontracting practices. These practices are often comprehensive and cost-efficient. Information systems lead to development of the key question of what to produce within the organization (in-house) and what to obtain from the market. This is subcontracting. Technological development in general has imposed constraints in organizational operations.

Technological development also results in division of labour. Information and communication technologies therefore enlarges the scope of work by reducing coordination costs and enabling a feasible planning, control and communication of cross-organizational operations (Kallinikos, 2006). The falling communication costs as a result of information technologies have led to the spread of global sourcing practices. In order for products and services to be transferred in the global market, they have to be mobile and easily transferable. The mobility of such goods and services largely depends on dissolvability of operations within organizations. This is possible through standardization of technologies across the world market and the use of information and communication technologies. Information technologies that are based on standardized software and hardware often result in transferable functions and tasks across organizations.

From information and technology point of view, it is clear that the advent and use of technological information within organizations is the root cause of the remaking of infrastructural conditions that are concerned with the operations and structure of organizations. Computer-based technologies have an impact on the communication and interaction patterns within organizations and as a result cause a change in the operations and the structure of the organization. In this regard, the individuals in the organization also change their way of doing things. Tasks shift and formal organizations decompose into informal system of informatized structure. This may also affect the infrastructure within the organization.

One of the ways through which information systems affect organizational structures and operations is the synthesis of information into a decision making element (Eisenstein, 2002). In this case, information may be gathered, transformed and processed to come up with a solution to a given problem. This may include the use of computer based technologies. The whole process often involves information management using an appropriate information system. The result may be that the entire information process may distort the normal operation of the organization. The solution derived from data analysis and processing in information systems may also require a change in certain elements of the organization.

On a negative perspective, the observation and personal judgement criteria of traditional methods are not applied in information systems. This may hinder the development of creativity of individuals. Individuals over-depend on information and communication technologies in decision making processes and operations within organizations. This may limit the creativity and innovation of individuals. Human skills are also limited by computerized systems which don’t require human skills and make decision making easier and computerized.

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