International Journal of Software Engineering and Its Applications

Vol.8, No.8 (2014), pp. 201-208

http://dx.doi.org/10.14257/ijseia.2014.8.8,19

Management Information Systems Research for Small and Medium

Enterprises: A Sustainability Perspective

Srinivas Nowduri Ph.D.

Associative Professor and Chairman Department of Information Technology &

Computer Science, American University of Afghanistan, Darul Aman Road, Kabul,
Afghanistan
([email protected]/[email protected])

Abstract

The management information systems (MIS) research and its significant contribution
towards small and medium enterprises (SMEs) improvement is analysed via sustainability.
Corporate sustainability along with its business significance is highlighted from new
entrepreneur perspective. SMEs and their susceptibility in this modern era with
sustainability, call it sustainable SMEs (SSMEs) is addressed. SMEs and their opportunity to
work with large-scale organization with the help of computer based systems is highlighted.
Finally presents an insight of MIS research towards SSMEs.

Keywords: Small and medium enterprises (SMEs), Sustainability, Management

information systems (MIS)

1. Introduction

Over the years, the business environment has become extremely complex and highly
integrated, resulting a sudden rise to the numerous business functions and operations at the
workplace. Primarily a huge volumes of data that is being generated every day, along with
managers experiencing difficulties in making effective decisions due to these complexities [9,
10]. At the same time, the management function is increasingly experiencing the challenge of
keeping track of all the diverse organizational resources, numerous business activities, as well
as in monitoring the entire business process and the huge order-turnover processes. In
response these, most of the modern businesses have established information systems
(computer based), which help keeping track of all their activities right from the planning stage
to the delivery of value to the final consumer in the product market [5].
As a result, a highly competitive entrepreneurial atmosphere demands that managers
should be clear concerning aspects of the business, should plan effectively, and should be in
position to make fast smart business decisions at each stage of the operation chain in order to
succeed [10]. This has gradually led to the evolution of the Management Information System
(MIS), an advancement in computer based systems, as a software tool for supporting the
decision making function of the organization; many studies have highlighted the multiple
benefits of the MIS as a decision making tool of the organization.
Over the years, this MIS has taken part in improving productivity, quality and many
business aspects start quickly contributing significantly for the modern corporate world.

ISSN:1738-9984 IJSEIA
Copyright ⓒ 2014 SERSC
International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

However, it also starts carrying some limitations due to fast changing marketing and business
trends; which are beyond the scope of this research. At the same time, the research and
development of MIS is also fine-tuned, incorporating certain environmental issues,
addressing the modern business world. Automation and work environment has become a
significant part of the modern corporate world. Computerization of several routine tasks and
echo friendly work environment has surfaced several new facets to modern businesses.
However, it is an undeniable fact that the continued deterioration of natural environments
in the modern global business era poses greater risks as well as opportunities for the present
businesses, which further underpins the need to fine tune the organizational thought processes
towards sustainability [7]. In that respect, modern organizations are facing yet another crucial
challenge of generating decisions that focus on sustainability and innovative environmental
strategies, thereby leading to the evolution of the modern Sustainable SMEs that are fine-
tuned towards social responsibility as well as sustainable development. The SSMEs research
is still growing, thereby increasingly highlighting the modern SSMEs focus on environmental
responsibility as well as technology up-gradation for strategic business advantages.
Generally, environmental responsibility encompasses the measures to reduce, recycle
material, while technology up-gradation entails the use of computer based systems such as the
MISs among other innovative tools. A vast proportion of literature covers the contributions of
the MIS to the establishment of SSMEs; for that reason, this present study will explore the
Management Information Systems research and its impact on Sustainable Small and Medium
Enterprises (SSMEs).

2. The Management Information System concept for SMEs

There are numerous definitions of the MIS concept but all of them reach consensus that the
system provides information, which supports the decision making function of the
organization [8]. The MIS has been around for nearly two decades, but it has evolved to
encompass the growing information technologies, thus, in todays’ business context, MIS is a
computerized business processing system that generates information that is vital for the
organizations’ decision making processes, for the aim of achieving business goals [12]. The
MIS is central to the functioning of the organization because it collects raw data from various
ends, converts it into useful information, and sends it to the parts of the organization that need
to benefit from the said information, thereby fulfilling the information needs of individuals,
teams, and management respectively.
The MIS generates different types of information such as descriptive, diagnostic,
predictive, as well as prescriptive information; descriptive information identifies the present
conditions thereby partly helping in identifying the problems. Diagnostic information
measures the disparity between “what is” and “what ought to be” while predictive
information is concerned with the possible future trajectories or outcomes; the prescriptive
type of information provides answers to what should be done to address the problems the
organization is facing. In that respect, the MIS provides the organization with effective past,
present, prediction information that is vital for the efficient running of the organization.
Therefore a typical MIS system in the organization today is a computerized database of
financial information organized and programmed to produce regular reports on operations for
every level of management in the organization [2].
The MIS plays a crucial role in the organization because it becomes increasingly
challenging for individuals to decipher crucial information from the vast data collected by the
organization with clarity and conciseness without the help of computerized systems. The MIS

202 Copyright ⓒ 2014 SERSC

 International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

eliminates the possibility of human error in terms of completeness, accuracy, validity,

timeliness, as well as value of information in the analysis and evaluation of data that is
significant for key decision making in the organization. In that respect, an effective
management information system makes it easy to handle large volumes of data, to confirm
the validity of information, process and analyse complex data giving multi-dimensional
views; furthermore, this system enables the quick search and retrieval of data, mass storage of
data, fast communication of information as well as quick responses to the constantly shifting
needs of information.
Among the MIS concepts for SMEs one need to analyze the information from three
different perspectives as detailed below.

A. Value of Information for SMEs: The value of information is very essential for a new
entrepreneur while setting up his/her business. For example, the information pertaining to the
strategic location of business, existing competitors and the social community. Therefore an
entrepreneur should possess preliminary knowledgeable about the product, place and location
such as climate changes and natural sources availability at the business location. Information
is always dynamic, keep changing, might impact the initial views of the entrepreneur, to
remain competitive in the changing market. Most of the times the value of 'information' is
implicit rather than explicit, results in a chain reaction. For example, information support
business decision, these business decisions demands actions, and finally these actions affect
business achievements, which help determining the organizational performance.

B. Information as a software tool for Entrepreneurs (Intelligent Decision Making): This

information is fed in to the computer based systems (results in software tools) and make use
of them for decision making. For example, one often comes across process and product tools,
for improving the productivity and quality of the business. Sustainability issues like climate
changes, use of renewable energy sources, etc, come under the umbrella of business process,
for new entrepreneurs. These software tools (enriched with information) ultimately designed
and used based on the economic feasibility of the business, aiming towards particular
business goals.

C. Sustainability Information for SMEs: This information is basically required for young
entrepreneurs for two main purposes viz., for smooth transfer of business from one generation
to the other, and to remain competitive in the volatile market place; as a long term business
strategy. This information is essential not only to corporate employees, but also to the
business and resources. Sustainability coupled with technology is definitely essential for long
term viability of the business.
Therefore design of MIS for modern SMEs should primarily include three levels of
information viz., Organization level, Application level and User level [3][5].

3. Sustainability and Modern SMEs: A Bridge for Future Generation

SMEs

Given the increasing global attention on complex business challenges such as climate
change, and the contribution of business operations on the gradual deterioration of the natural
environment, the concept of sustainable development has taken a central position in
organizational strategies [6]. The concept of sustainability has been taunted as the effective
management tool for addressing the combined challenges of climate change and sustainable

Copyright ⓒ 2014 SERSC 203

International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

business development all over the world. Businesses have to consider sustainability factors in
their plans and incorporate them in their operations by adopting the management techniques
that help in the planning, organization, and overall control of operations to promote both the
business, environmental, as well as societal needs. The MIS is very significant in the
establishment of innovative environmental strategies that enables the organizations to tackle
the complex challenges besetting their effective operation in the face of the complex market
dynamics.
In this modern era, even the small businesses inevitably engage in the conventional
business functions of consulting, marketing, sales, research, and communications, among
others, thus, MIS has become an integral part of the small business operations [1]. The
prevailing MIS research highlights that a vast majority of SMEs have established large
computer networks on which they display substantial databases that support their decision
making functions to promote sustainable development. Precisely, the MIS research has
increasingly become a critical tool for the sustainability of SMEs since it has been established
beyond any reasonable doubt that every business needs to have an effective information
system in place, to help keep track of all the business functions and operations. Sustainability
is a crucial aspect of the SMEs movement, especially given the heightened awareness of the
potentially detrimental effect of human actions on the natural environment. For instance,
destructive weather events such as earth quakes, tsunamis, and floods, among others have all
been attributed to the damaging impact of human actions in the drive for entrepreneurship,
and this has led to the growing emphasis on the concept of SSME in the corporate world.
In the context of sustainability, SMEs should take a non-economic stance by focusing on
better living and environmental improvements. That is, they must focus on searching new
opportunities to create new products and services using new technologies or production
methods that lead to the enhancement of social as well as environmental conditions.
Moreover, SMEs focus on the efficient utilization of energy and natural resources while
harnessing the development potential of the new resources whose exploitation has been found
to be cheaper, and resulting to less harmful impacts on society in general. The SMEs have
been very successful at implementing sustainability measures due to their effectiveness in
manipulating technologies, particularly where they can enhance outcomes, in decreasing the
potential negative impact of entrepreneurial activities on the natural environment and the
human condition in general. For instance, the SMEs have been successful at implementing
various sustainability measures that have enabled them to absorb wastes and pollution cost-
effectively, without causing permanent or irreversible harm to the natural environment.

SMEs Sustainability SSMEs

+ =

The question of what sustainability factors impact the SMEs business success is
completely depends on the nature of SMEs business venture. The following are some
of the sustainability factors (not limited to) vital for young entrepreneurs and modern
SMEs
a) Use of renewable energy sources
b) Use of pollution control techniques
c) Avoiding the use of Hazardous materials

204 Copyright ⓒ 2014 SERSC

 International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

d) Establishing a link between employees and the existing business

community
e) Fine tune the business strategy towards adapting to climate changes
f) Periodically producing suitability reports

The rapid changing technological advancements intertwined with environmental

effects also contribute progress of SMEs significantly. The very idea of
"sustainability" stems from different perspectives like environmental and ecological
sciences. Investigation of sustainability via MIS support for SMEs and entrepreneurs
is precisely the focus of this research. Modern MIS functionality needs to support
sustainability and help entrepreneurs, remain competitive.

4. Impact of MIS Research for SSMEs

Within the modern corporate world, MIS has become a key ingredient in the organizational
transaction processing as well as business operations, since it provides vital reports to the
various levels in the organizational hierarchy. Added to this MIS systems are specifically
designated to give the right information when needed, enabling managers to exercise effective
control of organizational resources and operations. For instance, the MIS provides the mid-
level managers with organizational performance reports, which they use to predict future
growth direction while the top management utilize the MIS for strategic decisions. There by
in this highly competitive global business environment, an effective MIS enables SMEs to
win competition since it provides the tools that can be used to evaluate and understand
business dynamics both within and outside the SMEs yielding competitive advantage [11]. At
the same time, the myriad challenges presented by the complex and fast-changing global
business environment, such as effects of green house gases, establishing a strong relation
between employees and community members, ways of reducing the pollution and industrial
waste. Use of modern automation systems for generating green products and reduce
environmental impacts, apart from integrating with strong business process. All these factors
invariably exerts a huge pressure on entrepreneurs' to respond effectively for sustainability in
the face of the resulting socio and environmental circumstances.
On the other hand, an accurate, complete, and timely information is also a key resource in
the present highly complex and competitive global business environment. This is precisely
important to this modern society for facilitating effective management decisions in the pursuit
of organizational development goals [3]. Enterprises need to have the appropriate information
at the right time in order to respond effectively to the numerous market dynamics, in order to
make profits and to survive the competition in the long term. The MIS research has been very
significant to the growth and development of the SSMEs since it has enabled these enterprises
to incorporate numerous sustainability factors in their organizational plans thereby making
them more resilient and capable of survival in the face of the turbulent changes in the global
business environment. Similarly, the incorporation of sustainability factors has enabled the
enterprises to adapt to the myriad socio and environmental changes thereby prompting their
growth and development effectively; besides that, the SMEs have emerged to be more
innovative and productive through the effective utilization of raw materials and energy
sources.
Past literature on MIS research clearly highlights three crucial factors of SMEs, viz.,
management, information, as well as systems; which contribute significantly to the

Copyright ⓒ 2014 SERSC 205

International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

sustainability of SMEs; each of these factors have a significant impact on SSMEs in varying
degrees [1]. The open question to many researchers, is to look for sustainability factors
associated with these, and the ways in which MIS can address these. The current MIS
research needs to contribute to the sustainability of SMEs by providing management with the
basic framework for addressing the sustainability factors; management addresses
sustainability factors from the environmental perspective, which takes into account the
conservation of crucial environmental factors including air, water, climate as well as
ecosystems. MIT research has also helped to fine tune management techniques in enhancing
the needs of the SMEs in the present and in the future, thereby aligning the enterprises
towards long-term economic performance. In other words, the MIT research highlights the
intricate interconnectedness of economic and commercial imperatives with the
environmental, as well as societal factors, which only emerges as the SMEs progress. The
MIS function enables the SSMEs to track and monitor their functional targets, thereby
providing the functional managers with real time information concerning the progress,
achievements, and shortfalls in the various aspects of the business. This information is very
significant in forecasting and long-term planning of the organization in response to the
emerging situations; the value of this information is utilized in remedial actions to rectify the
situation in case of shortfalls.
The MIS research has led to the systematization of business operations for the
effectiveness of enterprise system designs; effective system designs are the basis for
management and operational efficiency since it provides the manager with a variety of
management tools that can be used to process data into useful information [4].
Systematization of management provides the SME manager with models and tools that enable
him or her to manipulate data in ways that are not manually possible thereby making certain
management tasks simpler while considerably enhancing the decision making function.
The MIT research highlights the link between information and sustainability, that is, it
recommends the establishment of an information technology infrastructure that is efficient in
terms of diminished impacts on the environment such as greenhouse gas emissions from the
computing and IT related activities. For example, IT infrastructures that have central desktop
power management software in addition to sleep mode functionality when not in use are more
efficient in terms of energy utilization. In that respect, the MIS research is impacting SMEs
by compelling them to respond to the current environmental as well as societal concerns by
enforcing sustainability measures in their IT infrastructures, to promote protection and
conservation of the environment while promoting societal needs respectively.
In this modern era, several automation systems for business organization are quickly start
addressing sustainability issues, which is especially so for modern SMEs. These systems
provide vital information that provides vision for the efficient future utilization of renewable
energy sources yielding reduced energy costs. For instance, the environmental management
systems require information in the monitoring, evaluation, enhancement, as well as
communication of enterprise environmental performance, thereby promoting sustainability of
the enterprises respectively. Therefore MIS research fine tuned to contribute significantly to
the organizational knowledge concerning the natural environment thereby promoting the
establishment of environmental strategies that take into account the protection of the
environment and contributing to the enhancement of the natural environment.
Finally the MIS research has prompted SMEs to consider the environmental and social
impact of business, to apply the business impacting sustainability factors to enhance their
competitiveness, and to connect the sustainability strategy with their prevailing corporate
business strategies. Overall, implementation of the MIS has greatly transformed the SMEs by
helping them to save money since it promotes the efficient utilization of resources while

206 Copyright ⓒ 2014 SERSC

 International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

considerable reducing waste, apart from enabling SMEs to respond effectively to business
risks in their environments. Moreover, SMEs maintain a positive social image and enjoy a
wide social acceptance due to their sustainability approaches, which have only resulted due to
the implementation of MIS as the decision making tool.

5. Useful Conclusions and Future Possibilities

The existing literature on business management approaches reveals a considerable body of

research on the concept of managing people, time and resources through MIS. These MIS
systems and their significance in the present global business environment is rapidly changing.
This is precisely so, in view of the broadened information and technology (IT) platform
coupled with sustainability issues such as environmental and societal changes. MIS research
has been very significant to the growth and development of the SSMEs in the highly complex
and fast-changing global business environment by enhancing their capacity to respond and
contain the myriad environmental and societal changes.
Sustainability being a primary concern for many modern organizations in the present
market conditions, MIS research needs to be fine tuned to dire need for strategic decision-
making processes that yield competitive advantage for enterprises. It is concluded that the
design and architecture of MIS for quick and accurate data processing, enable enterprises to
incorporate numerous sustainability factors in their organizational plans. Further making
SSMEs more resilient and capable of survival in the face of the turbulent changes in the
global business environment, needs further investigation. Incorporating sustainability factors
into automation systems like MIS can enabled the business enterprises to adapt to the myriad
societal and environmental changes. This might ultimately results in prompting their growth
and development effectively. The impact of MIS on MIS is expected to emerge more
innovative and productive through the effective utilization of raw materials and renewable
energy sources.

References
[1] Nowduri, Srinivas & Al-Dosary, Shafi. “Management Information Systems and Its Support to Sustainable
Small and Medium Enterprises.” International Journal of Business and Management, 7.19(2012): pp.125-
131.
[2] Portougal, Victor & Janczewski, Lech. “An information system for operations management: Co-ordination
and integration.” Industrial Management + Data Systems, 98.8(1998): pp.356-361.
[3] O’Shea, Michael. “Information management: Making your system work.” The Office, 118.2(1993), pp.26.
[4] Engdahl, Lora. “A new mindset about MIS.” Association Management, 45.12(1993): pp. 47.
[5] Allingham, Patricia & O'connor, Marcus. "MIS success: Why does it vary among users?" Journal of
Information Technology, 7.3(1992): pp. 160-168.
[6] Nee, Goh Yen & Wahid, Nabsiah Abdul. "The Effect of ISO 14001 Environmental Management System
Implementation on SMEs Performance: An Empirical Study in Malaysia", Journal of Sustainable
Development, 3.2(2010): pp. 215-220.
[7] Thongpoon, Sirluk, Ahmad, Noor & Yahya, Sofri. "Sustainable Performance of Thai SMEs: Investigating
the Entrepreneurial Competencies and Sufficiency Economy Philosophy", Asia Pacific Journal of
Management & Entrepreneurship Research, 1.2(2012): pp. 5-20.
[8] Asemi, Asefa, Safari Ali & Zavareh, Adelah. "The Role of Management Information System (MIS) and
Decision Support System (DSS) for Manager's Decision Making Process", International Journal of Business
and Management, 6.7(2011): pp. 164-173.
[9] Goodman, Susan. "Information needs for management decision-making", ARMA Records Management
Quarterly, 27.4(1993): pp. 12.
[10] Leidner, Dorothy & Elam, Joyce. “Executive information systems: Their impact on executive decision
making", Journal of Management Information Systems, 10.3(1994): pp.139.

Copyright ⓒ 2014 SERSC 207

International Journal of Software Engineering and Its Applications
Vol.8, No.8 (2014)

[11] Ong, Jeen-Wei & Hishamuddin, Bin Ishmael. “Sustainable Competitive Advantage through Information
Technology Competence: Resource-Based View on Small and Medium Enterprises.” Communications of the
IBIMA Journal 1(2008): pp.62-70.
[12] Nazari, Marzieh Zare & Nazari, Hamid Reza. “Management Information Systems and Business.”
International Journal of Information Science and System, 2.1(2013): pp.1-8.

208 Copyright ⓒ 2014 SERSC