1. UNDERSTANDING THE BUSINESS VALUE OF SYSTEMS AND MANAGING CHANGE11
UNDERSTANDING THE BUSINESS VALUE OF SYSTEMS AND MANAGING CHANGE

2. LEARNING OBJECTIVES
EVALUATE MODELS DETERMINING BUSINESS VALUE OF INFORMATION SYSTEMS
ANALYZE PRINCIPAL CAUSES OF INFORMATION SYSTEM FAILURE
ANALYZE REQUIREMENTS FOR BUILDING SUCCESSFUL SYSTEMS
SELECT STRATEGIES TO MANAGE SYSTEM IMPLEMENTATION *
© 2002 by Prentice Hall

3. MANAGEMENT CHALLENGES
UNDERSTANDING BUSINESS VALUE OF INFORMATION SYSTEMS
CHANGE MANAGEMENT IN INFORMATION SYSTEM SUCCESS & FAILURE
MANAGING IMPLEMENTATION *

4. UNDERSTANDING BUSINESS VALUE OF INFO SYSTEMS
CAPITAL BUDGETING MODELS
PORTFOLIO ANALYSIS
REAL OPTIONS PRICING MODELS *

5. CAPITAL BUDGET:
PAYBACK METHOD: How long will it take to pay back the investment?
RETURN ON INVESTMENT: Does return during useful life of an item exceed the cost to borrow money?
COST-BENEFIT RATIO: Does the ratio of benefit versus cost exceed 1? *

6. CAPITAL BUDGET:
PROFITABILITY INDEX: What is the ratio of present value of cash inflow to initial investment?
NET PRESENT VALUE: Accounting for cost, earnings & time value of money what is the investment worth?
INTERNAL RATE OF RETURN: Accounting for the time value of money, what is the return rate of an investment? *

7. COSTS & BENEFITS:
COSTS:
HARDWARE
SOFTWARE
SERVICES
PERSONNEL *

8. COSTS & BENEFITS: TANGIBLE BENEFIT: INCREASED PRODUCTIVITY
LOW OPERATING COSTS
REDUCED WORK FORCE
LOWER COMPUTER EXPENSES
LOWER VENDOR COSTS
LOWER CLERICAL/PROFESSIONAL COSTS
REDUCED GROWTH OF EXPENSES
REDUCED FACILITY COSTS *

9. COSTS & BENEFITS: INTANGIBLE BENEFIT:
IMPROVED ASSET USE; RESOURCE CONTROL; PLANNING
INCREASED FLEXIBILITY
MORE TIMELY INFORMATION
INCREASED LEARNING
ATTAIN LEGAL REQUIREMENTS
ENHANCED EMPLOYEE GOODWILL, JOB SATISFACTION, DECISION MAKING, OPERATIONS
HIGHER CLIENT SATISFACTION
BETTER CORPORATE IMAGE *

10. CAPITAL BUDGETING MODELS
LIMITATIONS:
Assume all relevant alternatives have been examined; cost & benefits can be expressed as $$
Ignore intangible benefits *

11. PORTFOLIO ANALYSIS:
ANALYSIS OF POTENTIAL APPLICATIONS TO DETERMINE RISKS & BENEFITS
DETERMINE DESIRABLE FEATURES, ACCEPTABLE RISKS OF REQUIRED SYSTEM
GENERATE PORTFOLIO OF CHARACTERISTICS, RISKS FOR EACH ALTERNATIVE
SCORING MODEL *

12. SCORING MODEL: IDENTIFY DESIRABLE FEATURES
PROVIDE WEIGHTS FOR EACH (ADD TO 1.00)
LOOK AT EACH ALTERNATIVE:
WHICH FEATURES ARE PRESENT?
TO WHAT EXTENT (as an amount)?
SCORE THE ALTERNATIVE
RANK-ORDER THE ALTERNATIVES
SELECT HIGHEST RANKED OPTION *

13. REAL OPTIONS PRICING MODELS
USEFUL UNDER UNCERTAIN CONDITIONS
INCLUDE ESTIMATES FOR MANAGEMENT LEARNING, VALUE OF DELAYING DECISION, VOLATILITY OF COSTS & REVENUES

14. CHANGE MANAGEMENT WHAT PROCESSES ARE BEST TO CHANGE: DESIGN DATA COST
OPERATIONS *

15. CHANGE AGENT
DURING IMPLEMENTATION, INDIVIDUAL ACTS AS CATALYST DURING CHANGE PROCESS TO ENSURE SUCCESS *

16. IMPLEMENTATION
ALL ACTIVITIES LEADING TO ADOPTION, MANAGEMENT, ROUTINIZATION OF INNOVATION
APPROACHES
ADOPTION
MANAGEMENT
ROUTINIZATION
ACTORS' ROLE
XXXX
STRATEGY
ORGANIZATIONAL
FACTORS
IMPLEMENTATION STAGES

17. INNOVATION PROCESS © 2002 by Prentice Hall
ACTOR CHARACTERISTICS & DEMOGRAPHICS
SOCIAL STATUS
EDUCATION
SOPHISTICATION
ACTOR ROLES
PRODUCT CHAMPION
BUREAUCRATIC ENTREPRENEUR
GATEKEEPER
INNOVATIVE
BEHAVIOR
© 2002 by Prentice Hall

18. ACTIONS & INDICATORS FOR SUCCESSFUL SYSTEM IMPLEMENTATION
SUPPORT BY LOCAL FUNDS
NEW ORGANIZATIONAL ARRANGEMENTS
STABLE SUPPLY & MAINTENANCE
NEW PERSONNEL CLASSIFICATIONS
CHANGES IN ORGANIZATIONAL AUTHORITY *
Source: Yin (1981)

19. ACTIONS & INDICATORS FOR SUCCESSFUL SYSTEM IMPLEMENTATION
INTERNALIZATION OF TRAINING PROGRAM
CONTINUAL UPDATING OF THE SYSTEM
PROMOTION OF KEY PERSONNEL
SURVIVAL OF SYSTEM AFTER TURNOVER
ATTAINMENT OF WIDESPREAD USE *
Source: Yin (1981)

20. FACTORS IN IMPLEMENTATION OUTCOME CAUSES OF SUCCESS OR FAILURE:
USER INVOLVEMENT & INFLUENCE
MANAGEMENT SUPPORT
LEVEL OF COMPLEXITY / RISK
MANAGEMENT OF IMPLEMENTATION PROCESS *

21. USER-DESIGNER COMMUNICATIONS GAP
DIFFERENCES IN BACKGROUNDS, INTERESTS, PRIORITIES
IMPEDE COMMUNICATION AND PROBLEM SOLVING
AMONG END USERS AND INFORMATION SYSTEMS SPECIALISTS *

22. USER CONCERNS:
WILL SYSTEM DELIVER INFORMATION I NEED?
HOW QUICKLY CAN I ACCESS DATA?
HOW EASILY CAN I RECEIVE DATA?
HOW MUCH CLERICAL SUPPORT WILL I NEED FOR DATA ENTRY?
HOW WILL SYSTEM OPERATION FIT INTO MY DAILY BUSINESS SCHEDULE? *

23. DESIGNER CONCERNS:
HOW MUCH DISK SPACE WILL MASTER FILE CONSUME?
HOW MANY LINES OF PROGRAM CODE WILL THIS FUNCTION TAKE?
HOW CAN WE REDUCE CPU TIME?
WHAT IS THE MOST EFFICIENT WAY OF STORING THIS DATA?
WHAT DATABASE MANAGEMENT SYSTEM SHOULD WE USE? *

24. LEVEL OF COMPLEXITY & RISK
PROJECT SIZE
PROJECT STRUCTURE
EXPERTISE WITH TECHNOLOGY *

25. CONTROLLING PROJECT RISK
LOW
HIGH
SMALL
LARGE
VERY HIGH
VERY LOW
MEDIUM-LOW
MEDIUM
STRUCTURE
TECHNOLOGY LEVEL
SIZE
RISK

26. CONSEQUENCES OF POOR PROJECT MANAGEMENT
COST OVERRUNS
TIME SLIPPAGE
TECHNICAL SHORTFALLS
FAILURE TO OBTAIN BENEFITS *

27. CAUSES OF POOR PROJECT MANAGEMENT
IGNORANCE & OPTIMISM
MYTHICAL MAN-MONTH: Many tasks sequentially linked, require training
FALLING BEHIND: Bad news travels slowly upward *

28. CHANGE MANAGEMENT CHALLENGES
ENTERPRISE SYSTEMS: High risk of failure, replacing legacy systems, myriad interconnections
BUSINESS PROCESS REENGINEERING: 70% failure rate, deeply rooted in old processes, employees often unprepared *

29. CHANGE MANAGEMENT CHALLENGES
MERGERS & ACQUISITIONS: Decline in shareholder value, difficult to integrate company systems, organizational change, worker morale *

30. MANAGING IMPLEMENTATION:
CONTROL RISK FACTORS: Gear tools, methodologies to level of risk
INTERNAL INTEGRATION TOOLS:
FORMAL PLANNING TOOLS
FORMAL CONTROL TOOLS *

31. FORMAL PLANNING TOOLS EXAMPLES:
PROGRAM EVALUATION & REVIEW TECHNIQUE: Diagram of project activities, sequential and concurrent, shows interactions of activities
GANTT CHART: Shows activities as bars along a time line, with beginning, end of each task
THESE PROVIDE SCHEDULES *

32. FORMAL CONTROL TOOLS:
BUDGET: Time, money, resources
MONITOR PROGRESS: Completion of tasks, fulfillment of goals
CONTROL RISK FACTORS: Cost/benefits *

33. EXTERNAL INTEGRATION TOOLS
LINK ALL USERS THROUGHOUT ORGANIZATION
USE END USERS AS TEAM MEMBERS
SHARE INFORMATION & PROGRESS
INCLUDE TRAINING
AVOID COUNTERIMPLEMENTATION *

34. ORGANIZATIONAL FACTORS
JOB DESIGN
STANDARDS & PERFORMANCE MONITORING
ERGONOMICS: Interaction of people & machines; jobs, health, interface *

35. ORGANIZATIONAL FACTORS
EMPLOYEE GRIEVANCE RESOLUTION PROCEDURES
HEALTH & SAFETY
GOVERNMENT REGULATORY COMPLIANCE *

36. ORGANIZATIONAL FACTORS
MONITOR PROGRESS: Completion of tasks, fulfillment of goals
CONTROL RISK FACTORS: Cost / benefits *

37. ORGANIZATIONAL FACTORS
ORGANIZATIONAL IMPACT ANALYSIS: How will system impact structure, attitudes, decision-making, operations
SOCIOTECHNICAL DESIGN: Explore group structures, task allocation, job design for human factor *

38. “FOURTH-GENERATION” PROJECT MANAGEMENT
EMERGING TECHNIQUES TO DEAL WITH COMPLEXITY
ENTERPRISE-WIDE FOCUS
DRIVEN BY STRATEGIC VISION & TECHNOLOGY
MAY REQUIRE SEPARATE PROGRAM OFFICE *

39. UNDERSTANDING THE BUSINESS VALUE OF SYSTEMS AND MANAGING CHANGE11
UNDERSTANDING THE BUSINESS VALUE OF SYSTEMS AND MANAGING CHANGE