28 Cross-Functional MIS

Dr. Sudhanshu Joshi

Introduction

The term “Integrated Management Information System”, refer to a very highly organized combination of personnel, equipment, and facilities performing data storage and retrieval, data processing, transmission and display, all in response to the needs of decision makers at all levels of the business.” (Hershner Cross, 1978).

“The formal group of processes that, operating on a collection of data structured according to the needs of a company, compiles, elaborates and distributes part of the information necessary for the operation of the company, and for the related management and control activities, supporting, in part, the decision-making processes necessary to carry out the business functions of the company.” (Hurtubise, 1984).

Importance of Information Systems

In order to have a viable information system that is responsive to a variety of information needs, all the measurable data pertaining to the organization must be organized in such a manner that it can readily be recorded, stored, processed, retrieved, and communicated as required by a variety of users. Conceptually, information system converts raw data into either a consumable report or input for a later phase of the processing cycle. Figure 27.1 depicts the Inter-disciplinary relevance of MIS.

Figure 2-1 depicts the Inter-disciplinary relevance of MIS (Source: Nolan and Wetherbe, 1980).

The Effect of Information Systems on an Organization.

Every organization has one or more information system for its various management levels. These systems have always existed. Their goal consists of retrieving daily operational data, which can then be processed and used to prepare reports that respond to management needs. Mangers of all levels must make frequent choices, selecting from a number of possibilities, not only to attain organizational objectives but also to operate, control, plan, and supervise.

Figure 27.2 (a): General Model of a System

A Management Information System (MIS) is an evolutionary design in which various organizational units use one system; a system that exploits computer technology and makes frill use of data, information and human resources. In converting data into information and information into significant actions, the MIS provides tools for all levels of management so that subsystems may function adequately.

Cross-Functional MIS effectiveness may be used to determine Information Technology (IT) impacts on the overall business productivity. A number of effectiveness measures have been identified to evaluate the effectiveness of Cross- Functional MIS in the literature under various names, there are six general measures: Cost/benefit analysis, multi-attribute analysis, simulation, the critical success factors, utilization, and informal approaches. These measures have been identified from a number of studies, which review the MIS evaluation literature

(Dickson, Senn & Chervany, 1977; King & Rodriguez, 1978; Zmud, 1979; Hamilton & Chervany, 1981a; Ives, Olson & Baroudi, 1983; Ives & Olson, 1984; Trice & Tracy, 1988; Wrigley & Dixter, 1991; Szajna & Scamell, 1993; Doll, Xia & Torkzadeh; 1994; Barki & Hartwick, 1994; Pitt, Watson & Kavan, 1995; Vandyke & Kappelman, 1997; Eldon, 1997; Pitt, Watson & Kavan, 1997).

The Need to have Cross-Functional Management Information System

There is a constant requirement for a cross-functional enterprise level Information System. Table 4-1 and 4-2 Explain the various aspects of Integration of Cross-Functional MIS and Benefits from it.

Table 4-1: Main aspects of integration of Cross- Functional MIS

Table 4-2: Benefits of Using Cross- Functional Management Information Systems (MIS)

What is the Framework for IT Enabled Cross-Functional Integration

IT based cross-functional integration (CFI) is the fundamental underlying requirement for the implementation of innovations to streamline, improve and automate business processes. A recognition and understanding of this fundamental infrastructural requirement can contribute to its consideration and incorporation in the design and development of information systems structures, right from the early stage of such efforts. CFI issues can be considered throughout the IS architectural design and development phases as a fundamental design requirement, independent of any current or future BPR or restructuring initiatives.

CFI facilitate easier implementation of innovations such as BPR (Hammer, 1990), cycle time reduction (Stalk, 1998; Marucheck, 1992), group processes (Rao and Jarvenpaa, 1991), and Workflow automation (Bitzer and Kamel, 1996; Joosten and Schipper, 1996). Further, identification of the importance of CFI and its implementation in successive enhancements to information systems architecture would lay the foundation for future process improvements throughout the organization, whether through a radical restructuring of selected processes or through a radical restructuring of selected processes or through a gradual improvement of all processes, e.g. in the mode of TQM (Earl and Khan, 1994).

But their are always challenges of high failure rates for BPR efforts (Clemons, Thacher, and Row, 1995; Moad, 1993; Bashein, Markus, and Riley, 1994). Researchers have reported very high failure rates for initial BPR efforts (Clemons, Thacher and Row, 1995; Moad, 1993; Bashein, Markus, and Riley, 1994). One cause of such failures many be weak CFI could limit the scope and success in implementing process innovations, which usually cross functional boundaries. Further, the need for large, unplanned investments to overhaul IS infrastructure. CFI is useful for the improvement of organization’s performance in areas such as product innovation (Swink, Sandvig, and Vincent, 1996), and R&D (Miller, 1995), product quality (Numerof and Abrams, 1994), development capability (Wheelwright and Clark, 1992), and TQM and quality improvement efforts (Porter, 1991).

Cross-Functional Integration

Cross-functional integration is the establishment of mechanisms and links that facilitate the needed coordination of the activities of different functions to ensure that these functions work together effectively to achieve the overall objectives of the organization. Such integration is also needed across different organizations to create a well managed, integrated supply chain of cooperative organizations with high responsiveness and low transactions costs. Therefore, CFI issues have been considered important at the Intra-organizational as well as the inter-organizational level.

Intra-organizational CFI

Close cross-functional coordination is vital for the effective functioning of an organizaito, much before the induction of Information Technology to support the information and process flow. In manufacturing and service organizations, sales, production and purchasing have to closely coordinate their activities to develop and adjust production and production and procurement plans to optimize inventories at all stages of production in line with customer preferences and demands. Budgeting, recruitment, manpower levels, and production capabilities need to be tied to short term and long term production plans. Activities of warehouse, good movement, various production lines, maintenance, tools engineering, and shipping also need to be coordinated. Similar coordination is also needed among various functional units in the non-manufacturing sector. For example, in Micro-finance companies, coordination is needed between different functions that perform credit checking, quoting, rating, underwriting, and other related processes.

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Suggested Readings:

(a) Magal (2009): Essentials of Business Processes and Information systems. Wiley

(b) Jawdaekar (2013): Management Information Systems: A Global Digital Enterprises Perspective Paperback. McGraw Hill Education.