© Pearson Prentice Hall Using MIS 2e Chapter 11 Information Systems Management David Kroenke 11/24 – 8:30AM

© Pearson Prentice Hall Study Questions Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q1 – What are the functions of the IS department? The major functions of a typical IS department include:  Planning the use of information technology to accomplish the organization’s goals and strategy.  Developing, operating, and maintaining the organization’s computing infrastructure (hardware, networks, communications).  Developing, operating, and maintaining the organization’s enterprise applications (software, data, procedures, people).  Protecting information assets (hardware, software, data, people).  Managing outsourcing relationships. Each organization’s IS structure varies depending on these factors:  Size  Culture  Competitive environment  Industry

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Fig 11-1 Typical Senior-level Reporting Relationships This organizational structure chart shows the typical top-level reporting relationships. Depending on the organization, the Chief Information Officer (CIO), also called the VP of IS, Director of IS, or Director of Computer Services, may report to the Chief Executive Officer (CEO), the Chief Operating Officer (COO), or the Chief Financial Officer (CFO), if the information systems support only accounting and finance activities.

© Pearson Prentice Hall Q1 – What are the functions of the IS department? The Technology Office, headed by the Chief Technology Officer (CTO) and under the CIO, investigates new information systems technologies and determines how the organization might benefit from them. The Operations function manages the computing infrastructure, monitors system users, and responds to their problems. It includes system and network administrators. The Development department manages the process of creating new information systems while maintaining existing information systems. It includes analysts who work with users, operations, and vendors to acquire and install licensed software. It may include programmers, test engineers, and technical writers.

© Pearson Prentice Hall Q1 – What are the functions of the IS department? If an organization uses outsourcing vendors, Outsourcing Relations is devoted to managing its outsourcing relationships. It negotiates outsourcing agreements with other companies to provide equipment, applications, and other services. Some companies have a separate Data Administration function that is responsible for protecting data and information assets by establishing data standards and data management practices and policies. Remember  Information systems (IS) help a business achieve its goals and objectives and include five components - hardware, software, data, procedures, and people.  Information technology (IT) focuses on products, techniques, procedures, and designs of technology. IT must be within an IS structure to be used.

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q2 – How do organizations plan the use of IS? Figure 11-2 shows the steps an organization must take to align the organization’s IS with the organization’s competitive strategy. Alignment is a never-ending process as organizations change, grow, or merge with other companies. The CIO is responsible for most of these items. The CIO is the representative for IS issues within the executive staff. The steering committee, a group of senior managers from major business functions, works with the CIO to set IS priorities, make decisions about major IS projects, and serve as a communication channel between users and the IS function. The IS department sets the steering committee schedule and agenda and conducts the meetings. The CEO and executive staff determine the membership of the steering committee. The CIO must ensure that priorities consistent with the organization’s competitive strategy are communicated and implemented in the IS department. All projects must be prioritized because no organization can afford to implement every good idea. Fig 11-2 Planning the Use of IS/IT

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q3 – What tasks are necessary for managing computing infrastructure? Fig 11-3 Distributed Check- Printing Company Fig 11-4 Problematic Centralized IS Fig 11-5 Decentralized Order- Management System The IS infrastructure must mirror the organization’s structure. That is, if the organization itself is centralized, then the IS infrastructure should be centralized. If the organization is decentralized with autonomous operating units, then the IS infrastructure should be decentralized. The figures below show the discord between one type of organizational structure and another type of IS infrastructure.

© Pearson Prentice Hall Q3 – What tasks are necessary for managing computing infrastructure? The IS department is responsible for creating, operating, and maintaining the organization’s computing infrastructure for end-users, networks, data centers, data warehouses, and data marts. These are huge, complex tasks which must be accomplished by an understaffed, marginally trained set of employees with turnover. These tasks are further complicated because every piece of technology, communication media, software, and employee is a point of failure, deviation, upgrade, and implementation, and the organization is continuously changing. The IS department must establish technology and product standards (configurations) and ensure end-users do not deviate from them. These configurations must support the type of work all users do with three or four standard configurations that do not please all of the users all of the time. The IS department must track user problems and monitor their resolution. They assign a tracking number to the problem, enter it into the queue according to its priority, and monitor the problem until it’s resolved. CIOs and IS operations managers also monitor the problem resolution process.

© Pearson Prentice Hall Q3 – What tasks are necessary for managing computing infrastructure? The figure below shows a typical IS operations group. Note the different kinds of skills necessary to support an information system. The employees must be hired, trained, directed, evaluated, and promoted or terminated in accordance with legally correct and ethically acceptable procedures. Fig 11-6 Organization of a Typical IS Operations Group

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? If an organization uses enterprise applications, it may need support staff for managing them. Either the IS department manages everything, or individuals and workgroups manage their own applications. Enterprise applications include some functional applications and all cross-functional applications including CRM, ERP, EAI, and SCM This figure provides a list of tasks involved in managing enterprise applications. Fig 11-7 Managing Enterprise Applications

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Manage development of new applications  Creating a new application begins when:  IS evaluates the alignment of the information systems with the organization’s strategy,  detects IS needs,  these needs are prioritized,  system plans are submitted to and approved by the steering committee, and  a development process results.  All development processes are variations on a theme of:  Identifying requirements,  designing the new system, and  Implementing and testing the new system.  The nature and amount of systems development work depends on the degree to which application components are outsourced.  In all cases, the requirements phase is done in-house.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Maintain legacy systems, adapt systems to changing requirements, track user problems and monitor fixes  Maintenance is fixing errors or enhancing systems.  IS prioritizes maintenance and implements changes in accordance with those priorities and budgets.  Maintenance can be in-house or outsourced.  IS must track user issues and problems, prioritize them, and record their resolution.  IS uses two different tracking systems for infrastructure issues and maintenance work. Major enterprise applications will have their own problem-tracking and resolution system.  Legacy systems have outdated technologies and techniques but are used because IS cannot afford the time and/or cost to replace the system, and off-the-shelf software is not available. These systems require more maintenance than state-of-the-art systems because the business model has changed significantly from the time when the legacy system was designed.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Integrate enterprise applications  Enterprise application integration (EAI) requires developers to create intermediate layers of software and intermediary databases to enable the integration of disjointed, functional systems.  This work requires knowledge of many different systems including legacy systems.  Companies usually conduct such work in-house rather than outsource it.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Fig 11-8 Organization of a Typical IS Development Group Manage development staff  New-project developers are typically software designers and programmers.  Sustaining-application developers work on existing applications.  Product Quality Assurance (PQA) engineers test software.  Technical writers develop installation instructions, help text, and other support documentation.  Configuration Management Specialists design, procure, implement, and maintain the 3 or 4 standard end-user configurations.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Fig 11-9 Data Administration Responsibilities Administering data resources  Data administration - pertains to all of the organization’s data assets.  Database administration - pertains to a particular database. A data administrator supervises the entire data functional group and may be the database administrator if there is only one database. This figure describes the responsibilities of data administration.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Define Data Standards  Data standards are definitions and metadata for data items shared across the organization.  Data standards describe the name, official definition, usage, relationship to other data items, processing restrictions, version, security restrictions, format, and data owner.  The data owner is a department within the organization that is most concerned with a data item and that department controls changes to the definition of that data item.  The lack of documented and known data standards causes duplication of effort, data inconsistency, wasted labor, and processing errors. Maintain the Data Dictionary  A data dictionary is a file or database that contains data definitions and metadata (the item’s name, description, standard format, and remarks).  The data administrator maintains the data dictionary.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Define Data Policies  Data policies are concerned with accessing, sharing, releasing, and securing data items.  The data administrator works with senior executives, the legal department, functional department managers, and others to set data policies.  Data policies are dynamic because the firm is constantly changing. Disaster Recovery Planning  Disaster recovery planning is the creation of systems for recovering data and systems in the event of a catastrophe such as tornadoes, fires, hurricanes, earthquakes, floods, terrorist events, or other significant processing disruptions.  Having disaster recovery plans in place does not mean you will recover without significant damage from a catastrophe. If done correctly, it does mean the business will remain a “going concern” after the incident.

© Pearson Prentice Hall Q4 – What tasks are necessary for managing enterprise applications? Fig Example of Data Dictionary Fields One of the responsibilities of data administration is to establish and maintain a data dictionary. This figure is an example of some of the fields found in a data dictionary.

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q5 – What are the advantages and disadvantages of outsourcing? Outsourcing is the process of hiring another organization to perform a service because “your backroom is someone else’s front room.” The outsourcer can achieve significantly greater economies of scale. Your backroom is a distraction. It does not add value to your product/service. Outsourcing gathers all risks into the risk of choosing the right vendor. You must add the cost of managing the outsourcing contract, and the cost of communications and logistics to the outsourcing contract cost. Fig Popular Reasons for Outsourcing IS Services International outsourcing is well-suited for 24/7 autonomous, asynchronous operations for nameless, faceless, placeless tasks. Outsourcing is not well-suited for non-routine symbolic analysis or systemic, synchronous tasks, which can constrain your quality, mix, volume, timing, and innovation.

© Pearson Prentice Hall Q5 – What are the advantages and disadvantages of outsourcing? Fig Outsourcing Risks Outsourcing information systems has risk and uncertainty because you lose control over the process (quality, mix, volume, timing, and innovation) and the assets (hardware, software, data, people, procedures). Outsourcing does not work well for systemic, synchronous tasks that directly impact your quality, mix, volume, timing and innovation. You use outsourcing for autonomous, asynchronous tasks.

© Pearson Prentice Hall Q1 – What are the functions of the IS department? Q2 – How do organizations plan the use of IS? Q3 – What tasks are necessary for managing computing infrastructure? Q4 – What tasks are necessary for managing enterprise applications? Q5 – What are the advantages and disadvantages of outsourcing? Q6 – What are your user rights and responsibilities?

© Pearson Prentice Hall Q6 – What are your user rights and responsibilities? You have certain user rights with regard to the IS department that supports you in your job. Here is a list of them. Fig User Information Systems Rights

© Pearson Prentice Hall Q6 – What are your user rights and responsibilities? You also have user responsibilities with regard to supporting your IS department. They include those shown in the list below. Fig User Information Systems Responsibilities