6. An international car company

A car company sells vehicles in dozens of countries around the world. Two factories make the cars. The task of the management team is to

  • Maximise profits and sales in every market
  • Keep the factories as busy as possible
  • Keep stocks at the optimum level
  • Respond to market threats such as competing car makers

They have an MIS department dedicated to providing weekly information on sales, stock levels, seasonal trends, best selling product, worst selling product and so on.

Here is a typical set of information for senior management and the decisions they need to make

Use of an MIS
MIS information provided Decision to be made
Sales are trending down in the USA because our prices are uncompetitive Do we start a marketing campaign to boost sales or can we afford to drop our prices
There is going to be a VAT hike in March. When this happened before, sales peaked just before the deadline as customers wanted to save money. Do we need to temporarily ramp up production. Can our suppliers deal with the short term demand.
Blue cars are proving to be 30% more popular than red cars in the market. Do we need to change the colour mix of our cars going into stock.
One of our factories is running at only 10% capacity, We are not making a profit. Do we need to shut down a factory. Can one factory cope with future sales.
We are paying our staff 10% less than industry norms. Staff turnover is increasing. What benefit package do we need to put together to retain our best staff.

And so on.

You can see that the MIS is providing very high level information to management. It is taking the huge amount of incoming data and extracting some very important trends and conclusions from it.

Note that an MIS department deals with facts not personal opinions. The facts are presented to management, then it is up to them to make a decision based on those facts.

An MIS such as this would include a powerful data management system and a high level of expertise from the data analysts in the MIS department

A good example of a vast MIS organisation is the UK 'Office for National Statistics'. They are independent from the political parties. They will present raw, verifiable facts - then it is up to current Government and the Opposition to put a political spin on those raw facts.

 

challenge see if you can find out one extra fact on this topic that we haven't already told you

Click on this link: Car industry MIS systems