An MIS report is a collection of data based on different aspects of a business and is prepared to analyse all the crucial areas of the business. While the primary focus of an MIS report is to analyse the company’s performance and optimise decision-making, it also plays a crucial role in the day-to-day activities of an entity, regardless of the size and niche of the business in question.
As in a sales summary report, all big to negligible data and dealings are recorded in these reports and they are typically generated to help the top-level management make decisions that forever favour the company. This report can also come into the Center stage while identifying pressure points and opportunities of a firm which is variable from firm to firm therefore an MIS report also changes from entity to entity.
Since decision-making is an everyday task for an entrepreneur, depending on an MIS report is inevitable. Especially if the company in question revolves around big sales, massive job opportunities and multiple clients, the decision-making becomes a huge task that has to be handled with care. This is where an MIS report truly shines.
In this article, we will explore all the important aspects of MIS reports and analyse how they can help streamline business operations.
Table of Contents
What Does MIS Reporting Stands For?
For a better understanding of an MIS report, the MIS report meaning has to be clearly analysed, and that begins with the MIS full form, which is a Management Information System. The term refers to a set of reports that share a clear view of the everyday activities of an entity which typically helps business owners or the top management make crucial decisions to avoid manual errors in decision-making.
Artificial data collection often ensures accuracy over manual data collection methods especially when it comes to maintaining and analysing business performances. To avoid any mistakes, one has to rely on efficient technologies while understanding what their position in the company is and what the potential threats to their businesses are. This is where the Management Information System becomes crucial for each firm.
The significance of an effective MIS report is far beyond identifying the pressure points and bottlenecks, it also helps organisations engage in daily operations more efficiently. Thus keeping an eye out on the daily operations of an organisation is highly crucial. It is important to analyse them for the better future of the business, and this can be easily done with the help of an MIS report. From easy analytical data to complicated information, including supply chain variables, and market trends, MIS reports simply focus on almost all the key areas that need to be reviewed.
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The Working of an MIS Report
The MIS reports are reports designed to help management assess the overall performance of an organisation and allow fast decision-making. While there is no exact process of MIS reporting, there is a common flow that is followed for preparing an MIS report.
Depending on the purpose of why the MIS report is being generated, some businesses collect automated digital data or trending data and analyse them according to their needs. There are also businesses that completely rely on data supplied by their staff members. Such reports are prepared periodically. For example, monthly, quarterly or yearly. They are not always prepared by the same department of a firm rather different departments in a company, bringing diversity.
After analysing an MIS report, experts can make a conclusion on how profitable a product or an organisation is, and they can also help businesses consider expansion. For instance, if the company is not showcasing growth, then an MIS report can indicate the slow performance and suggest better strategies for the sustenance of the company instead of an expansion.
Some companies only depend on using automatic management information systems to generate MIS reports because they cover all the core parts of the business to pull the required outcome. From the single report, multiple reports can be created based on the needs of the company and the area of focus. If the data collected are error-free, timely, relevant and reliable, the results are expected to be highly informative. It often projects the actual achieved results of the company along with the estimated target, showcasing where the company has to put more effort.
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Types of MIS Reports
Based on the company’s requirements, different types of MIS reports can be created, and some common ones are listed below:
1. Accounting MIS report
This type of MIS report is typically prepared by analysing different financial documents, such as income statements and profit reports. It is usually used by the financial department of a firm.
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2. Inventory MIS report
It shares relevant data about the inventories in the business, including the number of items in stock, the top and least selling items, etc.
3. Summary MIS report
With all the information and data regarding the business, a summary MIS report showcases a clear picture of the business’s finances.
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4. Profit MIS report
profit reports are concerned with highlighting the difference between the actual and estimated profit generated by a firm. This report also invites attention to the factors that may have led to the profit or loss.
5. Cash flow MIS report
This identifies the exact amount of cash inflow and outflow in the form. It highly involves the cash flows from the core operations of the business as well as from external investments.
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6. Exception MIS report
It presents all unusual or abnormal activities taking place within the organisation. This helps identify the problems from the root and rectify them as soon as possible.
7. Management control MIS report
It includes essential information related to the management that can significantly help with decision-making.
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8. Production reports
Production reports are typically prepared by the manufacturing department and are primarily created to compare the production targets with the final production count.
9. Abnormal losses reports
These reports are expected to help companies reduce their expenditure. Here the abnormal losses referred to the losses that are associated with the breakdown of missionary, raw material associated concerns, or natural calamities.
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10. HR MIS reports
Such MIS reports are used by the human resource department to carefully analyse the performance of employees in their firm. It calculates the total number of assignments or tasks completed by different employees at a given time.
11. Orders in hand report
These reports are created by the officials in the marketing department after analysing the ratio between the production capacity of the organisation with the orders received for products.
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12. Machine utilisation report
This report correctly demonstrates the number of hours a machine was utilised and the number of hours it stayed idle.
Components of an MIS Report
Just like there are different types of reports, there are also different formats used by different organisations. The formats may highly depend on the end need of the firm, however, there are some of the key elements that are never missed:
● Summary
It involves the findings and suggestions that can help decision-makers.
● Performance Indicators
These indicators are used within an organisation to keep a track of the performance of the company. Different indicators are used to analyse the growth in different aspects of the firm and together they help analyse customer satisfaction, sales growth, profit margins, and more.
● Charts and Pies
The collected data are represented in the form of understandable charts, pies, – boards, tables, or bars.
● Customer Data
After conducting numerous customer satisfaction surveys, businesses collect trustable information on customer behaviour and feedback to step up their game.
● Recommendations
This section includes recommendations to make adjustments to the existing business plan.
● Conclusion
The conclusion reinforces the key takeaways, stressing on the implications.
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How to Prepare an MIS Report?
Preparing an MIS report is easy, but involves a few key steps that ensure the report thus formed is useful for decision making. First and foremost, it is important to define the purpose and objectives of the MIS report to let the reader know what kind of analysis has been made and what questions it will answer.
Next comes the collection of data, which is followed by selecting the right metrics and the KPIs. Then comes the analysis of the data, which is extended to presenting the data visually. Subsequently, present the body of the report, and then provide recommendations based on the findings. Lastly, the report is reviewed and distributed among the beneficiaries. By following these key steps, informed MIS reports can be created that may offer added value to the organization.
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Why Should Companies Depend on MIS Reports?
An MIS report can come to the rescue in different ways. For instance, when a company is finding any sort of financial difficulty, analysing the MIS report is all it takes to find where it went wrong. While the big names of the market often depend on MIS reports for the smooth functioning of their business, small businesses do not usually consider generating an MIS.
There are several reasons why an MIS report is inevitable for a firm. Besides, highlighting the key problematic areas, such reports are reliable when making resource and investment decisions. Whenever a firm is thinking of any specific change such as seeking investment or looking for an expansion, an MIS report should be the first document to go through as it holds some of the most dependable initial questions with understandable answers. They also encourage communication within the organisation as well as within the investors, boosting their confidence.
As per some of the accounting firms in Dubai, the following are some of the key benefits that businesses look for while using MIS reports:
▪️It generates accurate reports that can be relied on while making well-informed business decisions
▪️It helps the management systematically collect all the big and small records
▪️MIS reports significantly reduce the complexities of business management
▪️Such reports can help in increasing the efficiency of the workforce, making it easy to track all the dealings, including production, sales, inventory, profit, losses, cash flows, etc.
▪️Goal setting becomes easier than usual
▪️With an efficient MIS report, the management can accurately calculate the actual working hours of the staff as well as the functioning hours of a machine
▪️Eliminates errors that might have occurred during manual entries
▪️MIS reports do the job within the shortest time frame
▪️It ensures the proper flow of information within the organisation
▪️It focuses on specific information rather than stuffing it with unnecessary details
FAQs
- Who uses MIS reports?
MIS reports are largely used by large-scale business owners or firms that are on the verge of expanding. However, it is equally important for small-scale businesses to prepare MIS reports to keep track of the day-to-day activities of the firm.
- How often should an MIS report be created?
MIS reports are usually created based on the needs of the organisation. The frequency of a report generation may typically range from daily, weekly, monthly to quarterly, and annually.
- How do an MIS report and a financial report differ?
While both reports are primarily about the business performance of an organisation, the MIS report is a wider concept that focuses on different operational data, whereas a financial report is more concerned with financial performance.
- What are the tools used to create MIS reports?
Several tools can be used among which the most common ones are Microsoft Excel or Google Sheets, Business Intelligence Tools like Qlik and Tableau, ERP systems like Oracle or SAP, and CRM Systems like Salesforce.
- What are the setbacks in generating MIS reports?
Common pitfalls may include timeliness, lack of standardisation, and data overload.
