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118 PART 2 • STRATEGY FORMULATION

“Information is the lifeblood of the company.” A satellite network connects Mitsui’s
200 worldwide offices.
A management information system’s purpose is to improve the performance of an
enterprise by improving the quality of managerial decisions. An effective information
system thus collects, codes, stores, synthesizes, and presents information in such a
manner that it answers important operating and strategic questions. The heart of an
information system is a database containing the kinds of records and data important to
managers.
A management information system receives raw material from both the external
and internal evaluation of an organization. It gathers data about marketing, finance,
production, and personnel matters internally, and social, cultural, demographic, envi-
ronmental, economic, political, governmental, legal, technological, and competitive
factors externally. Data are integrated in ways needed to support managerial decision
making.
There is a logical flow of material in a computer information system, whereby data
are input to the system and transformed into output. Outputs include computer printouts,
written reports, tables, charts, graphs, checks, purchase orders, invoices, inventory
records, payroll accounts, and a variety of other documents. Payoffs from alternative
strategies can be calculated and estimated. Data become information only when they are
evaluated, filtered, condensed, analyzed, and organized for a specific purpose, problem,
individual, or time.
Because organizations are becoming more complex, decentralized, and globally
dispersed, the function of information systems is growing in importance. Spurring this
advance is the falling cost and increasing power of computers. There are costs and bene-
fits associated with obtaining and evaluating information, just as with equipment and
land. Like equipment, information can become obsolete and may need to be purged from
the system. An effective information system is like a library, collecting, categorizing,
and filing data for use by managers throughout the organization. Information systems
are a major strategic resource, monitoring internal and external issues and trends, identi-
fying competitive threats, and assisting in the implementation, evaluation, and control of
strategy.
We are truly in an information age. Firms whose information-system skills are weak
are at a competitive disadvantage. In contrast, strengths in information systems allow firms
to establish distinctive competencies in other areas. Low-cost manufacturing and good cus-
tomer service, for example, can depend on a good information system.

Strategic-Planning Software
Some strategic decision support systems, however, are too sophisticated, expensive, or
restrictive to be used easily by managers in a firm. This is unfortunate because the
strategic-management process must be a people process to be successful. People make the
difference! Strategic-planning software should thus be simple and unsophisticated.
Simplicity allows wide participation among managers in a firm and participation is essential
for effective strategy implementation.
One strategic-planning software product that parallels this text and offers man-
agers and executives a simple yet effective approach for developing organizational
strategies is CheckMATE (www.checkmateplan.com). This personal computer
software performs planning analyses and generates strategies a firm could pursue.
CheckMATE incorporates the most modern strategic-planning techniques. No previ-
ous experience with computers or knowledge of strategic planning is required of the
user. CheckMATE thus promotes communication, understanding, creativity, and
forward thinking among users.
CheckMATE is not a spreadsheet program or database; it is an expert system that car-
ries a firm through strategy formulation and implementation. A major strength of
CheckMATE strategic-planning software is its simplicity and participative approach. The
user is asked appropriate questions, responses are recorded, information is assimilated, and