TYBMS Prof.

Hemant Kombrabail

MARKETING INFORMATION SYSTEM (MIS)

MEANING OF MARKETING INFORMATION SYSTEM (MIS)

Companies in India and across the world have been forced recognize and acknowledge -
the rising power of customers (across all classes) and the emerging new generation of
competitors. This rise in customer power has gained prominence especially in the post-
liberalization scenario, which is triggered by the extensive deregulation and the general
import duty reduction, leading to cutthroat competition. Given this scenario, it is no
wonder that firms are faced with the task of building up a database of customers (existing
and potential), enhance their product/service offerings continuously, understand their
customers' perceptions of its product and services vis - a - vis that of their competitors
and also to innovate (product and service mix) regularly so as to be able to set them apart
from the rest of the pack. This is no easy job because data may be available in plenty but
it has to be sorted and resorted so to ensure that this data reaches the people who need the
information for decision-making.

Thus has begun the age of information explosion with marketing decision makers and
also the other managers having learned that they need certain kinds of information during
regular intervals of time in order to deal with recurring decisions.

Marketing information system (MIS) is of recent origin and supports marketing decision-
making and marketing planning. It facilitates quick marketing decision-making and
thereby raises marketing excellence. However, MIS is not a substitute for, but an aid to
rational decision-making. Even after collecting all required information, the decisions are
to be made by marketing executives. Information is those cues that make managerial
decisions scientific. In brief, MIS is an essential support system for developing marketing
decisions, plans and strategies.

Marketing information includes all facts, estimates, opinions and other data used in
marketing decision-making. A lot of information is generated regularly from within the
organization and also from external sources. Such information can be collected
purposefully for planning business activities and for decision-making. Information is
useful to top and middle level management for planning and control of marketing
activities. The marketing manager takes marketing decisions in the light of the
information supplied through MIS. He is like a pilot on the flight desk controlling aircraft
as per the information available through instrument panels. Such information system
provides updated and varied type of information in an uninterrupted manner to a business
organization. In fact, information is the glue that holds organization together. Every
organization needs efficient MIS to effectively manage the information collected. In
business organizations, marketing information managers are appointed and are
responsible for creation and dissemination of marketing information throughout the
organization.

The meaning of MIS can be made clear with the help of a simple example of a pilot of an
aircraft. When a pilot is at the controls of his aircraft, he is constantly monitoring its

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(aircraft's) performance in relation to air speed/ light and altitude, engine revolutions so
that the, flight can continue safely towards a destination. The task of piloting the plane
centers on his receiving information through the instrument panels on his flight deck. He
takes decisions and sees that the plane moves towards the destination quickly and safely.
In many ways managing business or marketing activity is like piloting an aircraft. In
order to achieve marketing objective, correct decisions must be taken and correct
decision-making is possible only when reliable, up-to-date and adequate information is
made available regularly and promptly. This suggests the meaning and significance
(importance) of MIS.

It may also be noted that information has no value until managers use the information
collected to make better marketing decisions. For this the information gathered through
MIS/marketing intelligence/ marketing research should be distributed promptly to the
right marketing managers at the right time. Developments in information technology have
brought a revolution in information distribution. In many companies, marketing managers
have direct access to the information network at any time and from virtually any location.
This is due to advances in computers, software and telecommunication.

For the purpose of decision-making, marketers generally require three types of

information

• Information for the Purpose of Control: In order to ensure effective control, marketers
are interested in having access to weekly sales reports (on sales territories, product-wise
etc.), sales- expense ratios, warehouse inventory reports, etc. Such information will
enable the marketer to know what is happening, what has happened in the past or what
changes may be required to be taken in the future.

• Information for Planning Purpose: This will include economic and sales forecasts,
understanding demographic profiles, estimating social and political shifts

• Information for an ad-hoc Study: This could be information being sought for one-time
decisions or study like - whether a proposed new product is to be introduced? What sort
of an advertisement should for used for a national campaign and so on.

The latter two types of information involve research. If the reports are not fed into the
formal information system and is basically in the possession of the person who was
originally seeking the information, then this may lead to another problem, i.e. another
group or department may be seeking this type of information but in the absence of a
formal filing of the research report, may be unaware that such a study has already been
conducted.

This reiterates the fact that an effective Marketing Information System must be such that
it is able to identify, manage and disperse all the above-mentioned three types of
information. Moreover, the information systems will also have an impact on the location
and methods of Marketing Research.

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It is to be noted that the Marketing Information System is spoken to be as the same u&
Management Information System. This is because the systems are quite similar with the
only distinction that the former system applies to a system dedicated to the marketing
branch of management, while the latter refers to the whole spectrum of management. As
mentioned earlier MIS can also be termed as an extension of the scope of Marketing
Research. A more limited meaning of a MIS is that of a computerized network which
stores and supplies management information. This means that the co-ordinated efforts of
MIS and Marketing Research will enable the management to take better decisions by
supplying data and analytical operation facilities to the Marketing Research and thereby
relieving the latter from routine data and reports.

DEFINITIONS OF MARKETING INFORMATION SYSTEM:

(1) "A set of procedures and methods for the regular and planned collection,
analysis and presentation of information in making marketing decisions.” – Cox and
Good
(2) "A continuing and interacting structure of people, equipment and procedures to
gather, sort, analyze, evaluate, and distribute pertinent, timely and accurate
information for use by marketing decision-makers to improve their marketing
planning, execution, and control.” – Philip Kotler
(3) "Marketing information system (MIS) is an ongoing, organized set of procedures
and methods design to generate, analyze, disseminate, store, and retrieve
information for use in making marketing decisions." – William Stanton
(4) "Marketing information system (MIS) consists of people and/or equipment
organized to provide for the continuous, orderly collection and exchange of
information – both internal and external needed in a firm’s decision making
activities." – George Kress

FUNCTIONS OF MARKETING INFORMATION SYSTEM:

(1) Assembling of information or relevant marketing data through internal and
external sources Such data act as raw material of MIS
(2) Processing of information viz. editing, tabulating and summarizing the data
collected for the purpose of ready reference and critical analysis In short/ MIS
decides the information needs of the organization and generate and process such
information on a continuing basis
(3) Analyzing the data collected which is essential for drawing conclusions for
decision-making
(4) Storing of data collected viz. filing and indexing of information collected so
that it can be made available for use when required
(5) Evaluating the data viz. finding out accuracy and reliability of the data
collected
(6) Disseminating relevant information to decision-makers - Marketing
Managers
(7) Updating the information collected periodically by discarding outdated data
and incorporating new data available

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(8) Introducing updated information technology in the collection / processing and

storing of the information collected

CHARACTERISTICS OF MIS:
(1) Continuously operated process: Information is a skilled human accomplishment
MIS is a consciously developed technique for the flow of information to the
company. It operates continuously. Regular inflow of information acts as a feedback
in decision-making. It is an ongoing process as new information is added to the old
one in a continuous manner. The information supplied by the MIS should be relevant
and pertinent.
(2) Operates with speed and accuracy. Electronically operated data processing
technique can be used to collect and process new information. Computers are now
used for raising the efficiency of MIS. This brings speed and accuracy in the MIS and
indirectly in the decision-making process.
(3) Needs cooperation of departments and executives: Close cooperation and
understanding among functional departments, executives and specialists (computer
expert programmer and system analyst) are essential for purposeful collection and
utilization of the market information. Information collection is important but its actual
use in the decision-making process is more important. For this, cooperation of
departments and executives is essential.
(4) Facilitates prompt and correct decision-making: MIS provides updated
information on various aspects of marketing to managers/ executives. As a result,
managers are aware of new marketing developments taking place. They are also in a
position to take prompt decisions from time to time due to the feedback provided by
MIS. It acts as a data bank for the benefit of marketing managers. MIS stands
between the marketing environment and marketing decision maker. Marketing data
flow from the environment to the MIS. The data is processed and converted into
marketing information flow, which goes to the marketer for decision-making.
(5) Future-oriented: MIS provides information about possible future problems and
their solutions through appropriate marketing decisions. It acts as a preventive
mechanism in marketing management and offers guidance to marketing executives.
(6) Provides continuous information on marketing developments: MIS collects
and provides information on marketing to concerned executives. It goes to right
people at the right time. In other words, it provides right information at the right time
to right people for decision-making. As a result, decision-making process becomes
reasonably accurate and quick. MIS usually provides three types of information to
marketing managers. The information could be recurrent (information supplied on a
periodic basis), monitoring (information obtained from regular scanning of certain
sources) and requested (information sought by a marketing manager
(7) Acts as a link between external environment and internal resources: It
provides updated information about external marketing situation and facilitates
suitable adjustment in the internal resources to face the overall situation effectively.
(8) Operates in a systematic manner: MIS operates in a rational and systematic
manner. This is necessary for quick reference to required information. Proper system
in the collection and storing of information is necessary as varied type of information
is now easily available. Such information needs to be stored after due classification,

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etc. In brief, MIS needs well-prepared operational system for raising its utility and
efficiency.
(9) Uses modern technologies: Revolutionary changes are taking place in
information technology. New techniques and machines are available for collection,
processing and storage of information. Required information is made available to
marketing executives promptly. MIS is now becoming costly and also needs the
services of technically qualified staff (software experts). MIS is now based on
advanced technology. It is a computer-based method of data collection, processing
and storage. Due to the use of computers updated information is provided to
executives easily and quickly.

OBJECTIVES OF MARKETING INFORMATION SYSTEM

Marketing information system is a scientific method of collecting information, arranging
them in order and reporting to suit and feed the organization with information.
1. To gather data and information needed by the organization
2. To supply and maintain the flow of information periodically and continuously.
3. To provide pertinent and relevant data needed by the executives.

Hence Marketing Information System must provide:

1. Desired Information to the Executives: This is possible only by assessing the actual
needs of the executive. Analysis of each executive's decision-making responsibilities
should clarify his or her marketing information requirements; thereby identifying the
information outputs that the marketing information system should provide him or her.
The composite of the marketing information requirements for entire organization thus
identifies the variety and nature of specific information output that the marketing
information system should provide.'
2. Supply Needed Information: It is not dumping information that is not needed or
irrelevant. It is to supply needed information 'Each executive wants complete and
accurate information received on a timely basis yet not provided (routinely) in
overwhelmingly and confusingly large quantities. It is ironic that while organizations
generate increasingly massive volumes of data, many executives continue to voice
complaints that available information is too incomplete and not sufficiently relevant or
timely to use as a basis for marketing decisions. The marketing information system
should have the built-in capability of extracting from the data bank timely items of
information relevant for each executive's use in decision-making.

FACTORS JUSTIFYING THE NEED OF MARKETING INFORMATION

SYSTEM: The following points justify the need as well as importance of MIS:
1. Need of correct decision-making: MIS is needed for correct decision-making by
marketing managers. They understand current market situation with the help of such
information. If the information is reliable, the manager can take the final decision
quickly and with confidence. Decisions relating to products, prices, sales promotion
measures, channels of distribution, etc. can be taken by collecting and using the

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marketing information in a purposeful manner. This is natural as correct view of total

marketing environment is possible only through accurate MIS.
2. Need of promptness in decision-making: In the present aggressive marketing
system, quick marketing decisions are necessary. Time factor is important in
decision-making and all decisions must be taken quickly as delayed decisions are
costly and troublesome to a firm. Delayed decisions means not taking the benefit of
promising marketing opportunities. Support of reliable and updated information is
essential for such quick decision-making. MIS provides regular feedback, which is a
must for decision-making in the present ever-changing business environment.
A marketing manager can now collect required information while working at a home
office, in a hotel room or an airplane with the use of a laptop computer and phone. He
can obtain information from company databases or from outside information services.
He can analyze the information with the help of statistical packages and models; draw
conclusions and communicate decisions through electronic communications.
3. Growth of consumerism and growing consumer expectations: Consumerism is
a growing force in modern marketing. Consumers are now conscious and oppose their
exploitation. Their resistance is always harmful to marketing companies. It is,
therefore, necessary to study their expectations. For this, MIS is needed. In addition,
needs and expectations of consumers require careful consideration in marketing
planning and decision-making. Information about the needs and grievances of
consumers is available through MIS.
4. Complex nature of marketing system: Marketing system has become complex
due to market competition, availability of substitutes, government controls and
growth of consumerism. Long term planning and correct decision-making are
required to face the challenges of current marketing environment. For this, accurate
information about complex marketing environment is required. This is possible
through MIS.
5. Growing market competition: Marketing is, now/ highly competitive with
different varieties of products. Competition may be due to price, quality and sales
promotion techniques. A marketing manager needs accurate and updated information
about market competition and policies of competitors. It is through MIS that
information regarding market competition can be collected, analyzed and used while
taking marketing decisions.
6. Information explosion: There is information explosion in the business world due
to the use of new techniques of information collection and dissemination. A firm may
not require all information available from different sources. It is necessary to find out
precisely the information needs of the enterprise and sources that can supply such
information. Accordingly, MIS should be organized.
7. Rapid developments in information technology: Fast changes are taking place
in the field of information technology. Computers, internet, e-commerce, fax, e-mail
and other instruments are used extensively for managing huge information easily,
quickly and economically. A business firm needs efficient MIS in order to use latest
information in marketing management. In short, information serves as the lifeblood of

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modem marketing management. Lower level management needs operational

information for taking operational decisions while top-level management needs
strategic information for taking strategic policy decisions. There is a flood of
information (information explosion) knocking at the door of the management and
management has to use such information for its survival, stability and growth.
Marketing executives need market information (feedback) for correct decision-
making. Even marketing activities are now becoming complex and broader in scope.
These activities can be conducted in an orderly manner with the support of good MIS.
In brief, MIS is needed for dealing with new marketing problems and challenges
effectively.

DESIGNING MARKETING INFORMATION SYSTEM

MIS involves collection, processing, storing, evaluating and supplying information to
marketing mangers for decision-making. A firm needs suitable organizational structure
for managing MIS. Every business unit has to design its own MIS as per its needs -
present and future. Attention should be given to the following aspects/points while
designing MIS:
(1) Identify precisely the information needs: The firm has to find out its
information needs i.e. the type of information that it requires for taking marketing
decisions. There is information revolution in the business world. However, all
information is not useful to all enterprises. It is necessary to identify the information
needs so as to collect, arrange and store the required information properly.
(2) Identify the sources of required information: The required information for the
enterprise can be collected from different internal and external sources. The sources
that can supply required information easily and economically are to be identified for
actual use in the information collection process.
(3) Estimate the expenditure required on MIS: In this stage, the firm has to
estimate the cost of collecting and processing the required information. There should
be cost-benefit analysis of MIS. It is a non-productive service activity. Expenditure is
required in order to collect, arrange, process and store the required information. Such
expenditure should be minimum as far as possible. At the same time, required
information should be collected and made available for decision-making.
(4) Collection of information: After deciding the information required and its
sources, the next step is to collect the information from the sources selected. For this,
suitable department with necessary facilities, infrastructure and expert staff should be
established. The department has to collect and store the information systematically in
computers, files, etc. This will enable the MIS department to supply information to
other departments when required.
(5) Processing of information: The next step is data processing in which data are
arranged properly for quick analysis by departments. The updating of data is also
necessary in order to supply latest information to concerned departments. This
facilitates reasonably accurate decision-making by departments.
(6) Creation of information/data bank: With the completion of the steps noted
above, there will be an information bank within the organization. It will have

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information required by all departments. The information will be properly processed,

arranged and stored for ready reference. MIS department will maintain effective
communication with all other departments so that information will be supplied to
them quickly as per their need for decision-making.

PRECAUTIONS IN USING MIS

1. The firm should not put too much emphasis only on a computerized information
system and lose sight of the importance of human processors.
2. Efforts should be made to ensure the quality of data and not accept all computer
output as gospel because there is an old adage which goes as - "garbage in -garbage
out".
3. Specific care be exercised that computer outputs should not be voluminous so as
to discourage use by marketing decision makers.
4. The Marketing Information should be flexible enough to be adjusted according to
the specific use by decision makers and serve all levels of management.
5. When newly establishing and developing a Marketing Information System rather
than making it very sophisticated at the outset itself, it will help if improvising is done
by stages.
6. Executives and managers wanting Marketing Information should be properly
trained and also communicate the type of information being sought.

SOURCES OF MARKETING INFORMATION SYSTEM:

In MIS, information is collected, arranged, stored and made available to departments and
managers for decision-making. Information is the base of MIS. Such information is
collected from different sources, which include internal and external.

Internal Sources of Information:

(1) Old statistical records of the company.
(2) Sales invoices and sales statistics
(3) Sales-force reports
(4) Sales Analysis
(5) Production statistics
(6) Profit and Loss statements
(7) Operating Ratios
(a) Gross Margin ratios
(b) Expense Ratios
(c) Net Profit Ratios
(8) Departmental budgets and reports
(9) Old research reports and surveys
(10) Periodical progress reports
(11) Directors' reports and committee reports.

External Sources of Information:

(1) Trade journals and periodicals

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(2) Business press i.e. Economic Times, Financial Express, etc

(3) Census reports and other government publications on business, finance, marketing,
exports, etc.
(4) Publications of trade associations, chambers of commerce and other agencies
concerned with finance, trade, commerce and industry
(5) Publications of RBI/ financial institutions, term lending institutions and government
departments
(6) Publications and survey reports of IMF, World Bank, WTO, FAO/ etc.
(7) Published survey reports and statistical data
(8) Special reports, surveys etc. conducted by marketing research agencies, magazines,
advertising agencies etc.
(9) Publications of stock exchanges, commodity exchanges and export promotion
councils
(10) Daily press, reports and information.
(11) Marketing Research
(12) Syndicated services

ADVANTAGES / BENEFITS OF MIS

(1) Provides updated and timely information for decision-making: MIS provides
information about various aspects of marketing. Information acts as a feedback and
facilitates correct decision-making by marketing managers. Likely problems are
solved at the initial stage through suitable preventive measures. Thus, MIS facilitates
effective decision making by marketing executives. It acts as the lifeblood of modern
marketing management.
(2) Facilitates monitoring of marketing operations: Data on different aspects of
marketing can be collected and stored through MIS. This facilitates easy and effective
monitoring of the performance of products, markets, sales-force and so on. Thus,
continuous monitoring of marketing operations is possible through MIS.
(3) Raises efficiency of decision-making: Integrated and updated marketing
information may not be available easily and quickly in large companies with many
departments. However, separate arrangement can be made for collection, evaluation
and storage of such information on sound principles through efficient MIS. Thus/!
MIS is beneficial as it raises the efficiency of decision-making process in marketing.
(4) Facilitates quick reference: Easy and quick reference to old information is
possible due to MIS. Computers are now used for easy accessibility of MIS. Quick
reference to old information is possible due to modem computer techniques. Thus, the
use of computers facilitates easy reference to old records and this raises the utility of
MIS.
(5) Provides information on changing marketing environment: MIS provides
regular information to marketers about changing marketing environment much before
it actually takes place. Managers can forecast the future trends with the scrutiny of

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updated information. This enables managers to prepare marketing plans and strategies
for the future period.
(6) Promotes marketing excellence: MIS leads to marketing excellence. It is rightly
said that to manage a business well is to manage its future and to manage the future is
to manage information. Marketing decisions will be prompt and reasonably accurate
when they are based on dependable information. Thus/ MIS gives the benefit in the
form of marketing excellence.
(7) Facilitates tapping of marketing opportunities: MIS facilitates tapping of
promising marketing opportunities and effective defense against marketing problems
and threats likely to develop in the near future. Both benefits bring stability and
prosperity to business.
(8) Provides market intelligence: MIS acts as marketing intelligence wing of a
marketing firm. It provides information about new marketing trends likely to develop
in future. Such trends may be related to price trends, consumer expectations, extent of
market competition, new products likely to enter the market and so on. This
information is useful for long term marketing planning.

The advantages (noted above) suggest the importance of MIS. No marketing organization
can function effectively without the support of appropriate information system. The
information system should cover every aspect of marketing - the consumer, the market,
the competition and the environment. The marketing excellence of a firm has a direct ^
relationship with the MIS operated by it. Marketing excellence is the net result of correct
marketing decisions and correct decisions are possible only when updated and reliable
information is supplied promptly by the information system created within the
organization. This briefly suggests the importance of MIS in business/marketing
management.

COMPONENTS OF MARKETING INFORMATION SYSTEM:

The components of MIS are as noted and explained below:
(1) Internal marketing information.
(2) Marketing intelligence.
(3) Marketing research.
(4) Market information analysis.

(1) Internal Marketing Information: This component of MIS provides information

from within the organization itself i.e., through the accounting system on sales,
inventories, cost, cash flows, accounts receivable etc. and old records. Data on sales,
turnover, costs, cash flows, accounts receivable and payable, etc. provide information
required for marketing decision making. All such records are available within the firm
and hence these sources are rightly called internal sources of marketing information.
Reference to any old information is possible quickly if the available information is
already stored systematically through computer techniques.
Marketing managers use this internal source fully as the information is available easily
and quickly. Even current marketing information is easily available. For easy availability
of internal information, filing and record keeping system must be efficient.

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(2) Marketing Intelligence: The second component of MIS is the marketing intelligence.
This component provides information on external marketing environment. Here,
information is collected from external sources. This component of MIS provides
information regarding current marketing environment and changing conditions in the
market. Such information is easily available through census data, weekly and monthly
reports on markets and market news published in magazines and trade journals,
commercial press, reports of trade associations and chambers of commerce, annual
reports of companies and so on. Even reports of salesmen are useful to study current
market trend.

Professional market research agencies publish information on various aspects of

marketing and market trends. Information available from these sources may not be useful
in the present form. It is necessary to evaluate and arrange the information in a proper
order. This enables the marketing executives to draw conclusions and frame marketing
policies accordingly. Market intelligence acts as a mirror of marketing environment and
facilitates appropriate decision-making on marketing.

(3) Marketing Research: Marketing research is one more component of MIS. In this
component, specific marketing problem of the firm is selected for investigation. Data
regarding the problem are collected, tabulated, analyzed and conclusions are drawn. In
addition, suitable policy measures are recommended in order to solve the problem.
Marketing research as a component of MIS provides information but such information is
specific and useful for one specific purpose. MR and MIS are closely related functions.
Both provide updated information for decision-making by marketing executives.
However, MIS and MR are not substitutes of each other.

(4) Market Information Analysis: Information gathered by the company's marketing

intelligence and marketing research systems often requires more detailed analysis.
Sometimes, managers may require more help to use the information to their marketing
problems. This help may include advanced statistical analysis. With support from market
information analysis managers can make better marketing mix decisions, design sales
territories and sales-call plans, select site for retail outlets and forecast new product sales.

ROLE OF MIS IN MODERN BUSINESS:

(1) Essential supplement of business management: The role of MIS in the overall
business management is universally accepted. It is an essential supplement of
business management. It performs various functions and offers useful services and
this proves its constructive role in the modern business management.
(2) Helps in decision-making: Reliable information about all aspects of business is
available through MIS. This suggests that MIS plays an important role in planning
and decision-making.
(3) Provides feedback: MIS provides feedback and this suggests its supportive role
in business management. Managers at all levels need information. They analyze
information, draw conclusions and take reasonably correct decisions. This suggests
crucial role of MIS in the management of business.

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(4) Provides accurate and timely information: It is rightly observed that modern
business cannot function efficiently, if the information system at its disposal fails to
provide accurate and timely information. This suggests the importance of information
network, which serves as a key resource in business management.
(5) Provides information on business environment: Business activities are to be
adjusted as per the changes in the business environment. MIS provides information
about changes in the environmental factors and enables managers to take appropriate
decision to adjust business activities as per the need. This is how MIS plays a
supportive role in decision-making and follow-up measures in business management.

Marian Harper Jr. has rightly suggested the importance of MIS. According to him "To
manage a business well is to manage its future, and to manage future is to manage
information".

Thus, information management (collection, processing, tabulation, storage and easy

reference) is an integral aspect of total business management. Policies, plans and
decisions for .the future period can be designed accurately with the help of MIS. This
suggests the role of information system in modern business. Correct understanding of
total marketing environment is necessary for success, progress and prosperity of business.
This is possible through MIS. Business can be made competitive as well as consumer-
oriented by using the available market information in an intelligent manner. In brief,
information serves as the life & blood of modern business. MIS plays a positive role in
modern dynamic, competitive and global business.

ESSENTIAL REQUIREMENTS OF A GOOD MARKETING INFORMATION

SYSTEM
(1) MIS should be Unified and Centralized: Trn1 MIS introduced should be
managed as a single entity even when the information collected and stored may be
varied one. There may be different information components in every MIS but the
components should be integrated for reference purpose. It should operate as one unit.
The MIS of the firm should be at the central office. The chief of MIS must operate as
the consultant, coordinator and controller of all information components of the MIS.
The operating departments of the firm should be free to use the information but the
information management should be centralized.
(2) MIS should be a Decision Support System: MIS is expected to play an
important role in making marketing management more efficient accurate and result-
oriented. It should offer guidance to marketing managers in the decision-making
process. The MIS should act as decision support system. For this, information should
be supplied quickly and the information supplied should be up-to-date. The MIS
should help the marketing manager in the selection of right policy for the benefit of
the whole organization. The MIS should not act merely as a data bank. It should
accept more positive role and participate in the decision-making process in a
meaningful manner.
(3) MIS should be Quick and Accurate: The MIS should be user-oriented and also
quick. The information flow should be done accurately and also with speed. This is
necessary as there is information flood in the field of business world. In addition,

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information should be made available quickly to managers. Information must move

with speed as information supplied late to the department is not useful in the decision
making process. Even marketing opportunities are lost. This clearly suggests that MIS
should be accurate and should move/operate with speed within the organization.
(4) MIS should be Economical: MIS should be economical as far as possible. This
means the expenditure on running the system should be minimum as the system is not
directly productive. It is a service and supporting function. For such economy in the
MIS/ the principle of selectivity should be introduced in the collection/ processing,
storing and supplying information system. The cost of MIS should not exceed its
value. The expenditure of MIS should be minimum as far as possible. However, cost
reduction should not be at the cost of quality and reliability of information.
(5) MIS should be Selective: MIS should collect information that is absolutely
essential and useful in decision-making process. MIS should not be viewed as a mere
courier service department. It should sort out the information that is really useful to
the firm. This is essential when there is information flood due to the use of electronic
media of communication. Thus information needs of the organization should be
assessed and the MIS should operate accordingly. This avoids wastage of time and
money.
(6) MIS should be compatible with the Culture of the Firm: MIS should be
adjusted with the culture and level of sophistication attained by the business
organization. The MIS required by a large firm would be different as compared to one
required in a small firm even when both have to maintain their own MIS. The MIS
should be intelligible to the people who have to use the system frequently. After all.
MIS is a means and not the end in self. In brief, the management should set up a MIS
that will cater to the needs of an organization and also offer operational convenience.
(7) MIS should provide updated Information: It is necessary to use new techniques
for speed and accuracy in the MIS. Computers, microfilms, etc. should be used for
raising the efficiency of MIS. Communication technology is making rapid progress in
recent years. It is desirable to improve the MIS by using the latest available
techniques. Such updating of MIS is useful for future marketing planning and also for
quick, correct and relevant marketing decisions. Thus, in-built updating arrangement
should be incorporated in a good MIS.
(8) MIS should be Flexible: The MIS introduced in an organization should be elastic
or adjustable. It should not be rigid. When the system is flexible, new changes can be
incorporated easily, quickly and smoothly. Moreover, modern techniques can be
introduced for raising the efficiency and accuracy of the system. In brief, flexibility is
one essential requisite of a good MIS.
(9) MIS should use New Techniques: Along with information explosion,
information technology is also making rapid progress. New machines, methods and
techniques are being introduced in the collection, processing and storage of
information. New techniques bring speed, updating and accuracy in the MIS.
Managers can use the MIS to the fullest extent only when the latest techniques such
as computer technology and internet service are used in MIS itself.
(10) MIS should be Future-oriented: The MIS should be forward looking. It should be
future oriented. It should consider the future information needs of the firm and

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adjust/readjust its management accordingly. The decisions are to be taken for the
future period. For this, the MIS should be future oriented and not the past oriented.

A SIMPLE MODEL OF MIS

Person needing
Information
Statistical
Models
MIS Facilitator

Analytic
Database
System

Marketing
Mix Models

Computerized Internal Data External Data Adhoc

Search  Invoice data  Government Research
Capabilities  Sales data data
 Inventory data  Commercial
 Payroll data data

The model is inclusive of a facilitator, a database along with analytic software and the
capability to incorporate both continuous (internal and external) as well as one time or
ad-hoc data apart from providing computerized information searches.

"MIS facilitator" is the person(s) or the equipment through which the desired information
can be obtained. This could be a microcomputer or personal computer or a librarian
located in the decision maker’s office.

The "database" refers to the actual database accessible through the MIS. This will be
inclusive of the usual or routine internal data of the firm as well as the external data
regularly flowing into the firm. The database is also able to provide computerized
searches through both government agencies as well as commercial firms.

The "analytic system" refers to the general software packages that can be used to adjust
or supplement to the basic data. These may comprise of statistical tools like the
regression and analysis of variance models and also marketing mix models. The latter
could involve procedures for separating sales data into different criteria based on the
requirement of different decision makers such as sales - customerwise / territorywise /

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TYBMS Prof. Hemant Kombrabail

productwise etc. The MIS should be able to acknowledge the existence as well as locate
where or in which departments / units of the firm have made use of ad-hoc studies.

A very important element in a MIS is that the system must allow for the timely
disbursement of the desired information to the decision makers.

The "database" refers to the actual database accessible through the MIS. This will be
inclusive of the usual or routine internal data of the firm as well as the external data
regularly flowing into the firm. The database is also able to provide computerized
searches through both government agencies as well as commercial firms.

The "analytic system" refers to the general software packages that can be used to adjust
or supplement to the basic data. These may comprise of statistical tools like the
regression and analysis of variance models and also marketing mix models. The latter
could involve procedures for separating sales data into different criteria based on the
requirement of different decision makers such as sales - customerwise / territorywise /
productwise etc. The MIS should be able to acknowledge the existence as well as locate
where or in which departments / units of the firm have made use of ad-hoc studies.

A very important element in a MIS is that the system must allow for the timely
disbursement of the desired information to the decision makers.

RELATIONSHIP BETWEEN MIS AND MR:

Marketing information system is closely connected with marketing research. In fact, it is
one of the sub-systems included within the scope of MIS. Thus, marketing research is one
component of MIS. MR conducts studies on specific marketing problems and reports its
findings to marketing management. Such studies are undertaken by qualified persons
within the company or by an outside agency. Marketing ' research offers information and
guidance to marketing managers while dealing with specific marketing problems and
difficulties.
Marketing research needs detailed information from different internal sources, which can
be used easily and conveniently through the MIS. Problems relating to consumer
behavior, product or brand preferences, advertising awareness, sales promotion, etc. can
be studied with the help of information available through MIS. In brief, MIS provides
data required for different marketing research projects.
The basic objectives of MIS and MR are identical. Both offer information to marketing
executives and enable them to take quick and correct marketing decisions. Both are
interrelated. Large-scale manufacturing/marketing companies maintain up-to-date MIS
and also maintain independent marketing research department. In addition, both supply
ready reference regarding marketing activities and facilitate correct decision-making in
the marketing field.
MR and MIS are closely related functions. The basic purpose of both is to collect relevant
information in order to facilitate marketing ^decisions quickly and correctly. Both these
functions offer guidance to marketing managers in the conduct of their marketing
activities. However, MR generates information but MIS concentrates on the storage and

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TYBMS Prof. Hemant Kombrabail

flow of information to marketing managers for decision-making. Both the functions are
interrelated as both the functions aim at making marketing decisions more effective. In
this sense, it is said that MIS is a computer-based extension of MR.
MR is one vital component of MIS. It provides properly processed information on a
specific marketing problem and guides the marketing manager in finalizing plan to deal
with such problem. The information supplied by the MIS is of a general nature and needs
to be analyzed properly for drawing conclusions and for using the information for taking
decisions regarding marketing activities. This purpose is achieved through MR.
Similarly, both functions are treated as important functions for promoting sales, for
promoting consumer satisfaction and finally for effective planning and decision-making
in the field of marketing. Thus MIS and MR are closely interrelated and complementary
concepts. MR is some sort of marketing information system without any responsibility of
decision-making.
MR and MIS are supporting functions as both deal with the management of information.
In addition, they offer guidance to marketing managers in the conduct of their marketing
activities. Along with this, there are some basic points, which indicate the difference
between MR and MIS. For example, the job of MIS is to supply marketing information
whereas MR is concerned with problem analysis. MR uses marketing information but its
purpose is problem solving through appropriate marketing decisions. These points of
difference between MR and MIS are as noted below:

Dimension Marketing Research (MR) Marketing Information

System (MIS)
Meaning MR is "the systematic MIS is "a set of procedures and
gathering, recording and methods used for the regular
analyzing of data relating to the and planned analysis and
marketing of goods and presentation of information for
services". marketing decision making"
Nature of concept MR is a narrow concept as MR MIS is a broad concept. Its
is one of the components of MIS purpose is to collect information
on all aspects of business
Information MR provides precise and MIS provides information on
provided properly analyzed information various aspects of marketing in
regarding a specific marketing order to frame marketing
problem with a view to solving policies and marketing
that problem decisions.
Purpose The purpose of M.R. is to study The purpose of MIS is to
a specific marketing problem in provide relevant and reliable
depth and to solve it quickly and information to all departments
also in a satisfactory manner and facilitate quick and
reasonably correct decision-
making
Coverage MR collects information relating MIS collects information on
to specific marketing problem various aspects of marketing

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TYBMS Prof. Hemant Kombrabail

under investigation such as products, consumer

needs, market competition and
sales
Operational MR is conducted on problem by MIS is a continuous system and
method problem or project by project information is collected,
basis with each project having a analyzed used and also stored in
starting and ending point a regular and continuous
manner.
Use of computer It is a non-computer based MIS is a computer based process
system. However, computers as computer technology is
may be used while tabulating extensively used while
data or while analyzing the collecting, analyzing and
information collected. storing the information
collected
Type of MR is more past-oriented MIS is more future-oriented
orientation
Organizational Every company may or may not Companies must always make
structure maintain MR department arrangements for the collection
and storage of information
through MIS
Frequency of In M.R. data collection is not In MIS data are collected
data collection continuous but only as per the regularly on different marketing
research projects undertaken. aspects in which the firm
interested.
Sources of data In MR external sources such as In MIS external as well as
used surveys and census reports are internal sources (past records,
used for data collection documents, etc.) are used for
data collection.

MARKETING DECISION SUPPORT SYSTEM

The introduction of computers has facilitated the setting up of MDSS (Marketing
Decision Support System). Such system comprises of collection, storage, analysis and
reporting of marketing data. The difference between MIS and MDSS is that whereas the
former is centralized, the latter is decentralized and allows marketing managers to
interact directly with the database. The systems are generally computerized with one or
more models built in.

CHARACTERISTICS OF A GOOD MDSS

A good MDSS should have the following characteristics
1.Interactive. The process of interaction with the MDSS should be simple and direct.
With just a few commands the user should be able to obtain the results immediately.
There should be no need for a programmer in between.

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TYBMS Prof. Hemant Kombrabail

2. Flexible. A good MDSS should be flexible. It should be able to present the available
data in either discrete or aggregate form. It should satisfy the information needs of the
managers in different hierarchical levels and functions.
3. Discovery oriented, The MDSS should not only assist managers in solving the
existing problems but should also help them to probe for trends and ask new
questions. The managers should be able to discover new patterns and be able to act on
them using the MDSS.
4. User friendly. The MDSS should be user friendly. It should be easy for the managers
to learn and use the system. It should not take hours just to figure out what is going
on. Most MDSS packages ere menu driven and are easy to operate.

MDSS has the following components:

(a) Database (data sources, data management)
(b) Display
(c) Statistical analysis
(d) Modeling.

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TYBMS Prof. Hemant Kombrabail

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