Management Information
Systems - Class Note # 3 (Chap-12)
Prof. Yuan-Shyi Peter Chiu
Feb. 2011
1
Chap 12
Redesigning the organization with information systems
 12.1 Systems as planned organizational
change
 12.2 Business process reengineering and
Total Quality Management (TQM)
 12.3 Overview of Systems Development
 12.4 Alternative System-Building
Approaches
2
12.1
◇
How to develop an Information Systems Plan
~ Road Map indicating direction of System development :
1.
PURPOSE OF THE PLAN
2.
STRATEGIC BUSINESS PLAN
3.
CURRENT SYSTEMS
4.
NEW DEVELOPMENTS
5.
MANAGEMENT STRATEGY
6.
IMPLEMENTATION PLAN
7.
BUDGET REQUIREMENTS
( see p.383 )
3
12.1
◇
Enterprise analysis
( Business Systems Planning )
Organization-wide Information Needs in
terms of :




Organizational Units
Functions
Processes
Data Elements
Helps Identify Key Entities & Attributes
in Organization’s Data
4
12.1
◇
Critical Success Factors (CSFs)
■
small number, easily identifiable
operational goals
■
shaped by the industry, the firm, the
manager, the broader environment
■
■
believed to assure firm’s success
used to determine organization’s
information requirements
5
12.1
◇
Critical Success Factors & Goals
example: profit concern
 Goals (Automobile industry) :
Earnings per share,
Return on investment,
Market share,
New product
 CSF :
Styling, Quality dealer system,
Cost control, Energy standards
(Also see Table 12-1)
6
12.1
◇
Using CSFs to develop systems
 Collect managers’ CSFs
 Aggregate + analyze individuals’ CSFs
 Develop agreement on company CSFs
 Define company CSFs
 Use CSFs to develop information system
priorities
 Define DSS & databases
(Also see Fig. 12-2)
7
◇
Fig 12-2: Using CSFs to develop systems.
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12.1
◇
Spectrum of Organizational Change
 AUTOMATION
Using technology to perform tasks efficiently
/ effectively
 RATIONALIZATION OF PROCEDURES
Streamline SOPs ; Eliminate bottlenecks
 BUSINESS REENGINEERING
Radical redesign of processes to improve cost,
quality, service; maximize benefits of technology
 PARADIGM SHIFT
9
◇
Fig 12-3: Organizational change carries risks and rewards.
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12.1
◇
Paradigm Shift
 PARADIGM is a complete mental model of
how a complex system functions
 A PARADIGM SHIFT involves “rethinking”
the nature of the business, the organization;
a complete reconception of how the system
should function
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◇
Business Process Reengineering (BPR)
12.2
& TQM
 WORK-FLOW MANAGEMENT:
Streamlining process to move
documents easily, efficiently
 REENGINEERING:
Redesigning business processes to
lower cost, speed development
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12.2
Process Improvement and
Total Quality Management
 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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12.3
◇
Three basic solution alternatives
exist for every systems problem
To modify
To Do
Nothing
or enhance
Existing
systems
To Develop
a New
system
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12.3
Fig 12-5: Overview of System Development.
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12.3
Systems Development
The activities that go into producing
An information systems solution to
an organizational problem or opportunity
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12.3
Systems Development
CORE ACTIVITY
DESCRIPTION
SYSTEMS ANALYSIS
IDENTIFY PROBLEM(S)
SPECIFY SOLUTIONS
ESTABLISH INFORMATION REQUIREMENTS
SYSTEMS DESIGN
CREATE LOGICAL DESIGN SPECS
CREATE PHYSICAL DESIGN SPECS
MANAGE TECHNICAL REALIZATION OF SYSTEM
PROGRAMMING
TRANSLATE DESIGN SPECS INTO
PROGRAM CODE
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12.3
Systems Development
CORE ACTIVITY
DESCRIPTION
TESTING
UNIT TEST
SYSTEMS TEST
ACCEPTANCE TEST
CONVERSION
PLAN CONVERSION
PREPARE DOCUMENTATION
TRAIN USERS & TECHNICAL STAFF
PRODUCTION &
MAINTENANCE
OPERATE SYSTEM
EVALUATE SYSTEM
MODIFY SYSTEM
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12.3
Systems Analysis
Analysis of Problem to be solved with an
Information System
Feasibility Study:
Can problem be solved within constraints ?
19
12.3
Feasibility Study
as part of the systems analysis process ,
to determine whether the solution is achievable ,
given the organization’s resources and constraints
Technical
feasibility
Economic
feasibility
Operational
feasibility
20
12.3
Feasibility
 TECHNICAL :
Available hardware, software, technical
resources
 ECONOMIC :
Will benefits outweigh costs
 OPERATIONAL :
Is solution desirable within existing
conditions?
INFORMATION REQUIREMENTS:
Detailed statement of new system needs
21
12.3
◇
System Design
Details how system will meet the information requirements
as determined by the systems analysis.
Considering alternative technology configurations
Management & control of the technical realization of systems
Details the system spec that will deliver the functions
Identified during systems analysis
22
12.3
Logical and Physical Design
Logical design
Lays out the
components of the
system and their
relationship to each
other as they would
appear to Users .
Physical design
Produces the actual
spec for Hardware,
software, physical
database, I/O media,
Manual procedures ,
and Specific controls.
See Table 12-4 for Design Specifications p.395
23
12.3
◇
Role of end users

Users drive systems effort

Must have sufficient control to ensure
system reflects business priorities, needs

Functional users drive system needs
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12.3
Completing system development
process
 Programming:
Translating needs to program code
 Testing:
Does system produce desired results?
 Conversion:
Changing from the old to the new
25
12.3
Testing
Unit
Testing
( program
testing )
System
Testing
( functions)
Acceptance
Testing
( final
certification)
26
12.3
Testing

Unit testing :
Tests each unit separately
 System testing :
Do modules function as planned?
 Acceptance testing :
Final certification
Test plan :
Preparations for tests to be performed
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12.3
Conversion
Parallel Direct
strategy cutover
Pilot
study
Phased
approach
28
12.3
Conversion




Parallel : Old & new run same problems.
Give same results?
Direct cutover : Risky conversion to new system
Pilot :
Introduce into one area. Does it work?
Yes: introduce into other area
Phased : Introduce in stages
Conversion plan : schedule for conversion
Documentation
Description of how system works
29
12.3
Production & Maintenance
 Production:
Constant review by users & operators.
Does it meet goals?
 Maintenance:
Upkeep; Update; Corrections over time
30
12.4
Alternative System-Building
Approaches
Systems lifecycle
• Traditional methodology for developing
information system
• Partitions systems development process
into formal stages that must be completed
sequentially
See Table 12-6 for The Systems Lifecycle p.399
31
12.4
The Traditional System Lifecycle
 Project Definition :
Is there a problem?
Can it be solved with a project ?
 System Study :
Analyze problems in existing systems;
define objectives, evaluate
alternatives
 Design :
Logical & physical specifications
for systems solution
 Programming :
Develop software code
32
12.4
The Traditional System Lifecycle
 Installation :
Construct, test, train, convert to new system
 Post-Implementation :
On-going evaluation, modifications for improvement
to meet new requirements
Necessary for Large , Complex
Systems & Projects
33
12.4
Limitations of the LIFE CYCLE Approach
Building large TPS and MIS where
requirements are highly structured and well-defined
Very resource intensive : costly and time-consuming
Inflexible and inhibits change
Ill-suited to decision-oriented applications
34
12.4
Alternative System-building Approaches
 Prototyping
 Application Software Packages
 End-user Development
 Outsourcing
35
Fig 12-7: The prototyping process.
36
12.4
Advantages & Disadvantages of Prototyping
Most useful when there is some uncertainty about
requirements or design solutions
Especially valuable for the design of the end-user interface
of an information system, decision-support applications
May not be appropriate for all applications,
Better suited for smaller applications
Often not being fully documented and tested,
not being carried out as a polished production system
37
12.4
Developing systems with
Application Software Packages
under the following circumstances
Where functions are common to many companies
Where information systems resources for in-house
development are in short supply
When desktop microcomputer applications are
being developed for end users
38
12.4
◇
Advantages of Packages
Design activities may easily consume up to 50
percent or more of the development effort
Testing the installed package can be accomplished
in a relatively shorter period
Vendor is responsible for making changes to keep the
system in compliance with change; and enhancements
Cut the costs and free up internal staff for other
applications; System and user documentation are
prewritten and kept up to date by the vendor.
39
12.4
◇
Disadvantages of Packages
Hamper the development effort by
raising conversion costs
May not meet all of an organization’s requirements
Vendor refuses to support their products if changes have
been made that altered the package’s source code
Customization may be so expensive and time-consuming
40
12.4
A Substantially Customized Package
◇
Front-end programs
Package
Back-end programs
41
12.4
◇
Package Evaluation Criteria
Request For Proposal ( RFP)
Vendor
Quality
Functions
Included
Flexibility
UserFriendliness
Hardware
& Software
Resources
Installation
Effort
Database
/ File
Characteristics
Maintenance
Cost
Documentation
42
◇
Fig.12-8: The effects of customizing a software package on
total implementation costs.
43
Traditional systems (Life Cycle) Development
Staff
Information
System
management
Middle or senior
management
Systems
analyst
◇
programmer
Design Program Test
Weeks or months
End-User development
Middle or senior
management
Staff
End-user computing tools
Query languages
Graphics languages
Report generators
Application generators
Very-high-level languages
Microcomputer tools
Minutes or days
Fig.12-9: End-user versus system lifecycle development
44
12.4
◇
Advantages of End-user-developed I.S.
Improved requirement determination
User involvement and satisfaction
Control of the systems development process
by users
Reduced application backlog
45
12.4
◇
Disadvantages of End-user-developed I.S.
Insufficient review and analysis
Lack of proper quality assurance standards
and controls
Uncontrolled data
Proliferation of “private” information systems
■ 46
12.4
When to use outsourcing
Low reward
Will not
Not
for
excellence
critical
affect future
information
systems
innovation
The firm’s
existing
information
systems
capabilities
are limited
47
◇
12.4
Advantages of Outsourcing I.S.
Economy
Service
Quality
Making fixed
costs variable
Freeing up
Human
resources
Flexibility
Predictability
Freeing up
Financial capital
48
12.4
◇
Disadvantages of Outsourcing I.S.
Loss
of
control
Vulnerability
of strategic
information
Dependency
■ 49
12.4
◇
Management Challenges on
alternative systems building methods
Determining the right systems development
strategy to use
Controlling information systems development
outside the I.S.Dept.
Selecting a system development strategy that fits into
the firm’s information architecture and strategic plan
50
12.4
Summary
Alternative systems building methods
Distinguish
between
the various
alternatives
Understand
strengths
and
limitations
of each
approach
Understand Solutions to
types of
management
problems
problems
created by
for which
these
each is best
approaches
suited
51
Homework for Chapter 12
◇#1
Describe the critical success factors? And how to use
CSFs to develop systems?
#2 Describe how information systems contribute to TQM?
#3 What are the major stages of systems development?
#4 In systems analysis, what main considerations are
when determining its feasibility?
#5 What is the difference between logical design and
physical design?
#6 Name and describe the three stages of testing for an
information system?
#7 Name and describe briefly five alternative systembuilding approaches.
THE END
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