Chapter 14
Redesigning the Organization with Information Systems
14-1
Chapter 14
Redesigning the Organization with Information Systems
True-False Questions
1.
The overall business plan of the organization should support the information systems plan.
Answer: False
2.
Hard
Reference: p. 496
Difficulty:
Hard
Reference: p. 496
Difficulty:
Easy
Reference: p. 498
Difficulty:
Hard
Reference: p. 499
Difficulty:
Medium
Reference: p. 499
Organizational and individual CSFs must be the same within the organization if the
organization is to succeed.
Answer: False
9.
Difficulty:
The strength of the CSF method is that it produces a smaller data set to analyze than the
enterprise analysis method.
Answer: True
8.
Reference: p. 496
The principle method used in CSF analysis is JAD.
Answer: False
7.
Easy
The weakness of enterprise analysis is that it produces an enormous amount of data that is
expensive to collect and difficult to analyze.
Answer: True
6.
Difficulty:
When developing an information systems plan, the organization is only required to have a
basic understanding of its short-term information requirements.
Answer: False
5.
Reference: p. 496
An information systems plan should be decided on before selecting specific projects within
the overall context of a strategic plan.
Answer: False
4.
Hard
An organization must have a clear understanding of both its long- and short-term information
requirements if it is going to develop an effective information systems plan.
Answer: True
3.
Difficulty:
Difficulty:
Hard
Reference: p. 500
Rationalization of procedures often follows quickly from early automation.
Answer: True
Difficulty:
Medium
Reference: p. 500
14-2
Redesigning the Organization with Information Systems
10.
An organizational change involving a paradigm shift is low risk and high return.
Answer: False
11.
Reference: p. 502
Difficulty:
Easy
Reference: p. 504
Difficulty:
Medium
Reference: p. 504
Difficulty:
Easy
Reference: p. 505
Difficulty:
Medium
Reference: p. 506
Difficulty:
Easy
Reference: p. 507
Difficulty:
Easy
Reference: p. 508
The amount of testing time needed for a new system is consistently underrated.
Answer: True
20.
Medium
End users should not be included in the design process, but must be involved later.
Answer: False
19.
Difficulty:
Faulty requirements analysis is a leading cause of systems failure and high systems
development costs.
Answer: True
18.
Reference: p. 501
Systems development activities always take place in sequential order.
Answer: False
17.
Easy
TQM derives from concepts developed by American quality experts, but was popularized in
Japan.
Answer: True
16.
Difficulty:
The majority of reengineering projects achieve breakthrough gains in business performance.
Answer: False
15.
Reference: p. 501
Information technology can create new design options for various processes.
Answer: True
14.
Medium
The conventional method of designing systems establishes how information technology can
support processes and then establishes the information requirements of each business
function.
Answer: False
13.
Difficulty:
If organizations wait to apply computing power until after they rethink and redesign their
business processes, they may obtain large payoffs.
Answer: True
12.
Chapter 14
Difficulty:
Easy
Reference: p. 509
Thorough testing is not required if, during the programming stage, the design documents are
sufficiently detailed.
Answer: False
Difficulty:
Medium
Reference: p. 509
Chapter 14
21.
Redesigning the Organization with Information Systems
Test-plan documentation consists of a series of test-plan screens maintained on a database.
Answer: True
22.
Reference: p. 511
Difficulty:
Hard
Reference: p. 511
Difficulty:
Medium
Reference: p. 512
Difficulty:
Medium
Reference: p. 513
Difficulty:
Medium
Reference: p. 514
Difficulty:
Medium
Reference: p. 514
Difficulty:
Medium
Reference: p. 514
Structural diagrams are used to describe the relationships between classes of objects.
Answer: True
31.
Easy
Objects are grouped into hierarchies, and hierarchies into classes.
Answer: False
30.
Difficulty:
Object-oriented development is more iterative and incremental than traditional structured
development.
Answer: True
29.
Reference: p. 510
A structure chart is a bottom-up chart, showing each level of design, its relationship to other
levels, and its place in the overall design structure.
Answer: False
28.
Hard
Object-oriented frameworks have been developed to provide reusable, semi-complete
applications a company can customize into finished applications.
Answer: True
27.
Difficulty:
A data flow diagram offers a logical and graphical model of information flow, partitioning a
system into modules that show manageable levels of detail.
Answer: True
26.
Reference: p. 510
Documentation reveals how well the system has met its original objectives.
Answer: False
25.
Hard
The system is not in production until conversion is complete.
Answer: True
24.
Difficulty:
Detailed documentation showing how the system works is usually finalized before
conversion time for use in training and everyday operations.
Answer: False
23.
14-3
Difficulty:
Easy
Reference: p. 515
CASE tools facilitate the creation of clear documentation and the coordination of team
development efforts.
Answer: True
Difficulty:
Easy
Reference: pp. 516-517
14-4
Redesigning the Organization with Information Systems
32.
The oldest method for building information systems is prototyping.
Answer: False
33.
False
Difficulty:
Easy
Reference: p. 518
Difficulty:
Easy
Reference: p. 519
Difficulty:
Easy
Reference: p. 519
Difficulty:
Easy
Reference: p. 522
Difficulty:
Easy
Reference: p. 522
In the digital firm environment, organizations must be able to add, change, and retire
technology capabilities much more rapidly than traditional development methods will allow.
Answer: True
40.
Reference: p. 517
In some forms of outsourcing, a company hires an external vendor to create the software for
its system, but operates the software on its own computers.
Answer: True
39.
Medium
Generally all costs of a system are obvious at the beginning of a project.
Answer:
38.
Difficulty:
An advantage of fourth-generation tools is that they can easily handle processing large
numbers of transactions or applications with extensive procedural logic and updating
requirements.
Answer: False
37.
Reference: p. 516
End-user-developed systems can be completed more rapidly than those developed through
the conventional systems lifecycle.
Answer: True
36.
Medium
A problem with prototyping is that the systems constructed thereby may not be able to handle
large quantities of data in a production environment.
Answer: True
35.
Difficulty:
Prototyping is more iterative than the conventional lifecycle.
Answer: True
34.
Chapter 14
Difficulty:
Easy
Reference: p. 525
Businesses are using component-based development to create their e-commerce applications.
Answer: True
Difficulty:
Hard
Reference: p. 526
Chapter 14
Redesigning the Organization with Information Systems
14-5
Multiple-Choice Questions
41.
A road map indicating the direction of systems development, the rationale, the current
situation, new developments to consider, the management strategy, the implementation
plan, and the budget is called a:
a.
b.
c.
d.
project plan.
request for proposal.
information systems plan.
mission statement.
Answer:
42.
Easy
Reference: p. 496
personal interviews and critical success factors.
enterprise analysis and systems analysis.
object-oriented design and systems analysis.
enterprise analysis and critical success factors.
Answer:
d
Difficulty:
Easy
Reference: p. 499
A small number of easily identifiable operational goals shaped by the industry, the firm,
the manager, and the broader environment that are believed to assure the success of an
organization best describes:
a.
b.
c.
d.
strategic objectives.
management objectives.
critical success factors.
information plan objectives.
Answer:
44.
Difficulty:
Two principal methodologies for establishing the essential information requirements of
the organization as a whole are:
a.
b.
c.
d.
43.
c
c
Difficulty:
Easy
Reference: p. 499
The most common form of IT-enabled organizational change is:
a.
b.
c.
d.
rationalization of procedures.
paradigm shifts.
accessibility and empowerment.
automation.
Answer:
d
Difficulty:
Easy
Reference: p. 500
14-6
Redesigning the Organization with Information Systems
45.
The streamlining of standard operating procedures to eliminate obvious bottlenecks is:
a.
b.
c.
d.
rationalization of procedures.
paradigm shifts.
accessibility and empowerment.
automation.
Answer:
46.
Easy
Reference: p. 501
d
Difficulty:
Easy
Reference: p. 501
A paradigm shift involves:
a.
b.
c.
d.
rethinking the nature of the business itself.
rethinking the nature of the information systems process itself.
rethinking the nature of the organization itself.
Both a and b
Answer:
d
Difficulty:
Medium
Reference: p. 501
When systems are used to strengthen the wrong business model or business processes:
a.
b.
c.
d.
the resulting information system is very difficult to analyze.
the resulting system has no impact on the firm’s performance.
the business becomes more efficient doing what it shouldn’t do.
organizational change does not occur.
Answer:
49.
Difficulty:
rationalization of procedures.
paradigm shifts.
accessibility and empowerment.
business process reengineering.
Answer:
48.
a
The radical redesign of business processes is:
a.
b.
c.
d.
47.
Chapter 14
c
Difficulty:
Easy
Reference: p. 502
When many companies work together to jointly redesign their shared processes, James
Champy calls the procedure:
a.
b.
c.
d.
enterprise engineering.
Six sigma.
BPR.
X-engineering.
Answer:
d
Difficulty:
Hard
Reference: p. 504
Chapter 14
50.
Redesigning the Organization with Information Systems
Business process management does not include::
a.
b.
c.
d.
data flow diagrams
process monitoring.
analytics
work flow management.
Answer:
51.
Medium
Reference: p. 504
b
Difficulty:
Medium
Reference: p. 505
A specific measure of quality, representing 3.4 defects per million opportunities best
describes:
a.
b.
c.
d.
return on investment.
activity-based cost.
internal rate of return.
six sigma.
Answer:
d
Difficulty:
Medium
Reference: p. 505
External industry standards, standards set by other companies, and/or internally
developed high standards are used to set up:
a.
b.
c.
d.
total quality management.
six sigma installation.
benchmarking procedures.
workflow management.
Answer:
54.
Difficulty:
mid-level management.
a series of continuous improvements.
a few large-scale improvements.
eliminating design errors.
Answer:
53.
a
TQM focuses on:
a.
b.
c.
d.
52.
14-7
c
Difficulty:
Easy
Reference: p. 506
Systems design:
a.
b.
c.
d.
describes what a system should do to meet information requirements.
shows how the new system will fulfill the information requirements?.
always tries to increase precision.
includes the testing phases.
Answer:
b
Difficulty:
Easy
Reference: p. 507
14-8
Redesigning the Organization with Information Systems
55.
The entire system-building effort is driven by:
a.
b.
c.
d.
systems analysis.
end-user support capabilities.
the database design.
user information requirements.
Answer:
56.
Chapter 14
d
Difficulty:
Easy
Reference: p. 508
Unit testing:
a. includes all the preparations for the series of tests to be performed on the system.
b. tests the functioning of the system as a whole in order to determine if discrete
modules will function together as planned.
c. tests each program separately.
d. provides the final certification that the system is ready to be used in a production
setting.
Answer:
57.
c
Difficulty:
Easy
Reference: p. 509
System testing:
a. includes all the preparations for the series of tests to be performed on the system.
b. tests the functioning of the system as a whole in order to determine if discrete
modules will function together as planned.
c. tests each program separately.
d. provides the final certification that the system is ready to be used in a production
setting.
Answer:
58.
b
Difficulty:
Easy
Reference: p. 509
Acceptance testing:
a. includes all the preparations for the trials.
b. tests the functioning of the system as a whole in order to determine if discrete
modules will function together as planned.
c. tests each program separately.
d. provides the final certification that the system is ready to be used in a production
setting.
Answer:
59.
d
Difficulty:
Easy
Reference: p. 509
In the pilot study conversion strategy, the new system:
a.
b.
c.
d.
is tested by an outsourced company.
replaces the old one at an appointed time.
and the old are run together.
is introduced to a limited area until it is proven to work properly.
Answer:
d
Difficulty:
Easy
Reference: p. 510
Chapter 14
60.
Redesigning the Organization with Information Systems
In the parallel conversion strategy, the new system:
a.
b.
c.
d.
is tested by an outsourced company.
replaces the old one at an appointed time.
and the old are run together.
is introduced to a limited area until it is proven to work properly.
Answer:
61.
c
Difficulty:
Easy
Reference: p. 510
In the direct cutover conversion strategy, the new system:
a.
b.
c.
d.
is tested by an outsourced company.
replaces the old one at an appointed time.
and the old are run together.
is introduced to a limited area until it is proven to work properly.
Answer:
62.
14-9
b
Difficulty:
Easy
Reference: p. 510
The _____________ occurs after the system is in production.
a. preparation of documentation
b. iterative process
c. post implementation audit
d. feasibility audit
Answer:
63.
Difficulty:
Easy
Reference: p. 511
Changes in hardware, software, documentation, or production to a production system to
correct errors, meet new requirements, or improve processing efficiencies are termed:
a.
b.
c.
d.
tested.
classified.
maintenance.
models.
Answer:
64.
c
c
Difficulty:
Easy
Reference: p. 511
In terms of percentages, the maintenance phase devotes approximately _____ percent to
changes in data, files, reports, hardware, or system software.
a.
b.
c.
d.
20
25
40
35
Answer:
a
Difficulty:
Easy
Reference: p. 511
14-10
65.
Redesigning the Organization with Information Systems
The primary tool for representing a system’s component processes and the flow of data
between them is the:
a.
b.
c.
d.
data dictionary.
knowledge base.
user documentation.
data flow diagram.
Answer:
66.
Easy
Reference: p. 512
a
Difficulty:
Easy
Reference: p. 512
In object-oriented software development, relationship between objects would be
described using:
a.
b.
c.
d.
structural diagrams.
behavioral diagrams.
use case diagrams.
object diagrams.
Answer:
a
Difficulty:
Medium
Reference: p. 515
Object-oriented modeling is based on the concepts of:
a.
b.
c.
d.
processes and data classes.
data classes and data flows.
class and inheritance.
logical application groups and data classes.
Answer:
69.
Difficulty:
data dictionary.
data catalog.
data master.
data log.
Answer:
68.
d
A tool for structured analysis that contains information about individual pieces of data
and data groups within the system is called the:
a.
b.
c.
d.
67.
Chapter 14
c
Difficulty:
Medium
Reference: p. 513
Object-oriented development could potentially reduce the time and cost of writing
software because:
a.
b.
c.
d.
object-oriented programming requires less training.
iterative prototyping is not required.
objects are reusable.
a graphical interface is automatic.
Answer:
c
Difficulty:
Easy
Reference: p. 514
Chapter 14
70.
Redesigning the Organization with Information Systems
The industry standard for representing various views of an object-oriented system that
uses a series of graphical diagrams is:
a.
b.
c.
d.
XTHML.
XML.
UML.
PPT.IP.
Answer:
71.
Difficulty:
Medium
Reference: p. 514
describe interactions in an object-oriented system.
describe how employees will react to learning new systems.
reduce the need for extensive programming.
describe relationships between classes.
Answer:
a
Difficulty:
Easy
Reference: p. 515
The oldest method for building information systems is the:
a.
b.
c.
d.
pilot study.
systems approach.
iterative process.
systems life cycle.
Answer:
73.
c
Behavioral diagrams are used to:
a.
b.
c.
d.
72.
14-11
d
Difficulty:
Medium
Reference: p. 516
In the traditional systems life cycle, end users:
a. are important and ongoing members of the team from the original analysis phase
through maintenance.
b. are important only in the testing phases.
c. have no input.
d. are limited to providing information requirements and reviewing the technical staff’s
work.
Answer:
74.
d
Difficulty:
Easy
Reference: pp. 517-518
The use of _______________ is most likely to produce systems that fulfill user
requirements.
a.
b.
c.
d.
documentation
prototyping
a pilot study
a parallel strategy
Answer:
b
Difficulty:
Medium
Reference: p. 518
14-12
75.
Redesigning the Organization with Information Systems
When systems are created rapidly, without a formal development methodology:
a.
b.
c.
d.
end users can take over the work of IT specialists.
the organization quickly outgrows the new system.
hardware, software, and quality standards are less important.
testing and documentation may be inadequate.
Answer:
76.
Difficulty:
Easy
Reference: p. 519
developing a formal development methodology.
requiring cost justification for end-user IS projects.
establishing standards for user-developed applications.
Both b and c
Answer:
d
Difficulty:
Easy
Reference: p. 519
If an organization’s requirements conflict with the software package chosen and the
package cannot be customized, the organization will have to:
a.
b.
c.
d.
outsource the development of the system.
redesign the RFP.
change the evaluation process.
change its procedures.
Answer:
78.
d
Management should control the development of end-user applications by:
a.
b.
c.
d.
77.
Chapter 14
d
Difficulty:
Easy
Reference: p. 521
“Hidden costs” such as _____________________ can easily undercut anticipated
benefits from outsourcing.
a. monitoring vendors to make sure they often are fulfilling their contractual
obligations.
b. transitioning to a new vendor.
c. identifying and evaluating vendors of information technology services
d. a, b, and c
Answer:
79.
d
Difficulty:
Easy
Reference: p. 522
Systems must be scalable to accommodate growing numbers of users and:
a.
b.
c.
d.
to deliver data over multiple platforms.
to accommodate new interfaces.
to accommodate systems built by external vendors.
to accommodate applications packages.
Answer:
a
Difficulty:
Medium
Reference: p. 525
Chapter 14
80.
Redesigning the Organization with Information Systems
14-13
Web services use:
a.
b.
c.
d.
a proprietary architecture.
a “plug and play” architecture.
joint application development.
rapid application development.
Answer: b
Difficulty:
Easy
Reference: p. 528
Fill in the Blanks
81.
Enterprise analysis is also known as business systems planning.
Difficulty: Medium
82.
Critical success factors are a small number of easily identifiable operational goals shaped by
the industry, the firm, the manager, and the broader environment that are believed to assure
the success of an organization.
Difficulty: Hard
83.
Reference: p. 501
A(n) paradigm shift is a radical reconceptualization of the nature of the business and the
nature of the organization.
Difficulty: Medium
87.
Reference: p. 500
Business process reengineering is the radical redesign of business procedures, combining
steps to cut waste and eliminate repetitive, paper-intensive tasks.
Difficulty: Medium
86.
Reference: p. 500
Rationalization of procedures is the streamlining of standard operating procedures,
eliminating obvious bottlenecks, so the automation makes operating procedures more
efficient.
Difficulty: Medium
85.
Reference: p. 499
Automation uses the computer to speed up the performance of existing tasks.
Difficulty: Medium
84.
Reference: p. 496
Reference: p. 501
Work flow management is the process of streamlining business procedures so the documents
can be moved easily and efficiently from one location to another.
Difficulty: Easy
Reference: p. 502
14-14
88.
Redesigning the Organization with Information Systems
Six sigma is a specific measure of quality, representing 3.4 defects per million opportunities.
Difficulty: Hard
89.
Reference: p. 509
Testing is the exhaustive and thorough process that determines whether the system produces
the desired results under known conditions.
Difficulty: Easy
97.
Reference: p. 507
Programming is the process of translating the system specifications prepared during the
design stage into code.
Difficulty: Easy
96.
Reference: p. 507
A(n) systems design details how a system will meet the information requirements as
determined by the study of information needs.
Difficulty: Medium
95.
Reference: p. 506
Information requirements contain a detailed statement of the information needs that a new
system must satisfy; identifies who needs what information, and when, where, and how the
information is needed.
Difficulty: Medium
94.
Reference: p. 506
A(n) feasibility study is the way the organization determines whether the solution is
achievable, given the organization’s resources and constraints.
Difficulty: Medium
93.
Reference: p. 506
Systems development is the activities that go into producing an information systems solution
to an organizational problem or opportunity.
Difficulty: Easy
92.
Reference: p. 505
Benchmarking is the setting of strict standards for products, services, or activities and
measuring organizational performance against those standards.
Difficulty: Medium
91.
Reference: p. 505
Total quality management (TQM) focuses on making a series of continuous improvements..
Difficulty: Easy
90.
Chapter 14
Reference: p. 509
A(n) test plan includes all the preparations for the series of tests to be performed on the
system.
Difficulty: Easy
Reference: p. 510
Chapter 14
98.
Redesigning the Organization with Information Systems
Conversion is the process of changing from the old system to the new system.
Difficulty: Easy
99.
14-15
Reference: p. 510
A(n) parallel strategy is the safest and most conservative conversion approach.
Difficulty: Medium
Reference: p. 510
100. Documentation describes how an information system works from both the technical and the
end-user standpoints.
Difficulty: Easy
Reference: p. 510
101. Structured refers to the fact that the techniques are step by step, with each step building on
the previous one.
Difficulty: Medium
Reference: p. 511
102. A data flow diagram represents a system’s component processes and the flow of data
between them..
Difficulty: Easy
Reference: p. 512
103. Process specifications describe the transformation occurring within the lowest level of the
data flow diagrams. They express the logic of each process.
Difficulty: Easy
Reference: p. 513
104. In structured methodology, the structure chart is a top-down chart, showing each level of
design, it relationship to other levels, and its place in the overall design structure.
Difficulty: Easy
Reference: p. 513
105. Object-oriented development uses the object as the basic unit of system analysis and design.
Difficulty: Easy
Reference: p. 513
106. In a class diagram, the attributes for each class are displayed in the middle portion of each
box.
Difficulty: Hard
Reference: p. 513
107. Unified Modeling Language (UML) has become the industry standard for representing
various views of an object-oriented system using a series of graphical diagrams.
Difficulty: Easy
Reference: p. 514
108. Behavioral diagrams are used to describe interactions in an object-oriented system.
Difficulty: Hard
Reference: p. 515
14-16
Redesigning the Organization with Information Systems
Chapter 14
109. Back-end CASE tools are used for coding, testing, and maintenance work.
Difficulty: Hard
Reference: p. 516
110. The systems life cycle is a traditional methodology for developing an information system that
partitions the systems development process into formal stages that must be completed
sequentially.
Difficulty: Easy
Reference: p. 516
111. Prototyping is the process of building an experimental system quickly and cheaply for
demonstration and evaluation.
Difficulty: Easy
Reference: p. 517
112. A(n) prototype is the preliminary working version of an information system.
Difficulty: Easy
Reference: p. 517
113. End-user development is the development of information systems by end-users with little or
no formal assistance from technical specialists.
Difficulty: Easy
Reference: p. 518
114. Query languages are software tools that provide immediate online answers to requests for
information that are not predefined.
Difficulty: Easy
Reference: p. 518
115. Customization is the modification of a software package to meet the organization’s unique
requirements without destroying the package software’s integrity.
Difficulty: Easy
Reference: p. 521
116. A(n) Request for Proposal (RFP) is a detailed list of questions submitted to providers of
software or other services to determine how well the vendor’s product can meet the
organization’s specific requirements.
Difficulty: Easy
Reference: p. 521
117. Outsourcing is the practice of contracting various operations to external vendors.
Difficulty: Easy
Reference: p. 522
118. Rapid application development is a process for developing systems in a very short time by
using prototyping, fourth-generation tools, and close teamwork among users and systems
specialists.
Difficulty: Easy
Reference: p. 525
Chapter 14
Redesigning the Organization with Information Systems
14-17
119. Joint application design is a process used to accelerate the generation of information
requirements by having end-users and information system specialists work together in
intensive interactive design sessions.
Difficulty: Easy
Reference: p. 525
120. Web services are software components deliverable over the Internet that enable one
application to communicate with another with no translation required using a standard “plugand-play” architecture.
Difficulty: Easy
Reference: pp. 526 and 528
Essay Questions
121.
Compare the strengths and weaknesses of enterprise analysis and strategic analysis.
Enterprise analysis argues that the firm’s information requirements can only be understood
by looking at the entire organization in terms of organizational units, functions, processes,
and data elements. The central method used in the enterprise analysis approach is to take a
large sample of managers and ask them how they use information, where they get it, what
their environments are like, what their objectives are, how they make decisions, and what
their data needs are. The results of this survey of managers are aggregated subunits,
functions, processes, and data matrices. The strength of enterprise analysis is in its complete
picture of the way the organization conducts its business. The weakness of the enterprise
analysis is that it produces so much data that it is expensive to conduct and difficult to
organize and analyze. A further weakness is that the enterprise analysis tends to look at the
way existing information is used and not at the fact that new approaches may be required.
The strategic analysis, or critical success factors, approach argues that organizations’
information requirements are determined by a small number of critical success factors of
managers. The premise of the strategic analysis approach is that there are a small number of
objectives and that managers can easily identify them. The principal method used is the
personal interview – three or four – with a number of top managers to identify their goals and
the resulting critical success factors. Systems are then built to deliver information on these
critical success factors. The strength of the CSF method is that it produces smaller data sets
than does enterprise analysis. The CSF method takes into account the changing environment
with which organizations and managers must operate. It is especially suitable for top
management and for the development of DSS and ESS. The method’s primary weakness is
that the aggregation process and the analysis of the data are art forms. There is no
particularly rigorous way in which individual CSFs can be aggregated into a clear company
pattern. A second problem is that there is often confusion among interviewees between
individual and organizational CSFs. They are not necessarily the same. What can be critical
to a manager may not be important to the entire organization. Finally, the method is biased
toward top managers because they are generally the only ones interviewed.
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Chapter 14
Describe the process that banks have gone through in reengineering the home mortgage
industry.
The application process for a mortgage once took about six to eight weeks and cost about
$3,000. The process is divided into three stages: origination, servicing, and secondary
marketing. In the past, a mortgage applicant filled out a paper loan application. The bank
entered the application into its computer system. Specialists, perhaps in as many as 8
different departments, accessed and evaluated the application individually. If it was
approved, the closing was scheduled. After the closing, bank specialists dealing with
insurance or funds in escrow serviced the loan. This “desk-to-desk” assembly-line approach
might have taken up to 17 days.
Banks have replaced this sequential process with a faster “team” approach. Load originators
in the field enter the application directly into laptop computers. Software checks the
application transaction to make sure that all of the information is correct and complete. The
loan originators transmit the application using a dial-up network to regional production
centers. The various specialists convene electronically, working as a team to approve the
mortgage. Some banks provide customers with a nearly instant credit lock-in of a guaranteed
mortgage so they can find a house that meets their budget immediately. After closing,
another team of specialists sets up the loan for servicing. The entire loan process can take as
little as two days.
123.
What are the steps in an effective reengineering process?
To reengineer effectively, senior management must develop a broad strategic vision that calls
for redesigned business processes. Companies should next identify a few core business
processes to be redesigned, focusing on those with the greatest potential payback in strategic
value. Next, management must understand and measure the performance of the existing
processes as a baseline. Using information technology creates new design options for various
processes because it can be used to challenge long-standing assumptions about work
arrangements that use to inhibit organizations. The organization’s IT infrastructure should
have capabilities to support business process changes that span boundaries between
functions, business units, or firms. It must also be remembered that a new information system
always affects jobs, skill requirements, workflows, and reporting relationships. Fear of these
changes will breed resistance, confusion, and even conscious efforts to undermine the
changes. Thus, in reengineering, people as well as processes must be considered.
124.
List and describe at least four ways that information systems can support total quality
management. Which do you think should be implemented first?
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Simplifying the product or the production process
Benchmarking
Use customer demands as a guide to improving products and services
Reduce cycle time
Improve the quality and precision of the design
Increase the precision of production
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Of what does systems analysis consist? What does the systems analyst do to achieve these
goals?
It consists of defining the problem, identifying its causes, specifying the solution, and
identifying the information requirements that must be met by a system solution.
The system analyst creates a road map of the existing organization and systems, identifying
the primary owners and users of data in the organization. From this organizational analysis,
the systems analyst details the problems of existing systems. By examining documents, work
papers, and procedures; observing system operations; and interviewing key users of the
systems, the analyst can identify the problem areas and objectives a solution would achieve.
Often the solution requires building a new information system or improving an existing one.
The systems analysis itself would include a feasibility study to determine whether the
solution suggested would be achievable from a financial, technical, and organizational
standpoint.
126.
List and describe at least nine factors considered in the design specifications for a new
system. Give at least two examples for each one.
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Output – medium, content, timing
Input – origins, flow, data entry
User interface – simplicity, efficiency, logic, feedback, errors
Database design – logical data model, volume and speed requirements,
organization and design, record specifications
Processing – computations, program modules, required reports, timing of
outputs
Manual procedures – what activities, who performs them, when, how, where
Controls – input controls, processing controls, output controls, procedural
controls
Security – access controls, catastrophe plans, audit trails
Documentation – operations documentation, systems documents, user
documentation
Conversion – transfer files, initiate procedures, select testing method, cut
over to new system
Training – select training techniques, develop training modules, identify
training facilities
Organizational changes – task redesign, job design, process design,
organization structure design, reporting relationships
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Describe the processes, considerations, and problems involved in testing the new system.
Testing answers the question, “Will the system produce the desired results under known
conditions?” The amount of time needed to answer this question has been traditionally
underrated in systems project planning. Testing is time-consuming: Test data must be
carefully prepared, results reviewed, and corrections made in the system. In some instances
parts of the system may have to be redesigned.
Three activities are involved in testing and information system:
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128.
Unit testing consists of testing each program separately in the system. The
objective is not to guarantee the programs are error free (which is
impossible), but to locate errors in the programs, focus on finding all the
ways to make a program fail, and correcting problems.
System testing tests the functioning of the system as a whole. It tries to
determine if discrete modules will function together as planned and whether
discrepancies exist between the way the system actually works and the way
it was conceived. Among the areas examined are performance time, capacity
for file storage, handling peak loads, recovery and restart capabilities, and
manual procedures.
Acceptance testing provides the final certification that the system is ready to
be used in a production setting. Users and management review the systems
tests. When all parties are satisfied the new system meets the standards the
system is formally accepted for installation.
What are the advantages and disadvantages of prototyping? Describe the steps in
prototyping. Give at least two circumstances under which prototyping might be useful.
Prototyping is most useful when there is some uncertainty about requirements or
design solutions. It is especially useful in designing the end-user interface. Because
prototyping encourages intense end-user involvement throughout the process, it is
more likely to produce systems that fulfill user requirements. Working prototype
systems can be developed very rapidly and inexpensively.
Rapid prototyping can gloss over essential steps in systems development. If the
completed prototype works reasonably well, management may not see the need for
reprogramming, redesigned, full documentation in testing to build a polished
production system. This can backfire later with large quantities of data or large
numbers of users in a production environment.
The steps in prototyping are:
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Identify the user’s basic requirements
Develop an initial prototype
Use the prototype
Revise and enhance the prototype
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Redesigning the Organization with Information Systems
List the identifying features of each of the five systems development approaches.
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130.
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Systems lifecycle – sequential step-by-step formal process, written specification and
approvals, limited role of users
Prototyping – requirements specified dynamically with experimental system; rapid,
informal, and iterative process; users continually interact with the prototype
Applications software package – commercial software eliminates the need for
internally developed software programs
End-user development – systems created by end users using fourth-generation
software tools, rapid and informal, minimal role of information systems specialists
Outsourcing –systems built and sometimes operated by an external vendor
Describe the object-oriented development approach. Why is it considered best for
applications involving the Internet?
This approach to systems development uses the object as the basic unit of systems analysis
and design. The system is modeled as a collection of objects and the relationships between
them.
In the digital firm environment, organizations need to be able to add, change, and retire their
technology capabilities very rapidly. Companies are adopting shorter, more informal
development processes for many of their e-commerce in the business applications, processes
that provide fast solutions that do not disrupt their core transaction processing systems and
organization databases.