1. 13.1 © 2007 by Prentice Hall Week #09 Chapter 13: Building Information Systems Chapter 13: Building Information Systems

2. 13.2 © 2007 by Prentice Hall LEARNING OBJECTIVES Management Information Systems Chapter 13 Building Systems Demonstrate how building new systems produces organizational change. Identify and describe the core activities in the systems development process. Evaluate alternative methods for building information systems. Compare alternative methodologies for modeling systems. Identify and describe new approaches for system- building in the digital firm era.

3. 13.3 © 2007 by Prentice Hall A New Ordering System for Girl Scout Cookies Problem: Inefficient manual procedures, high error rate. Solutions: Eliminate manual procedures, design new ordering process, and implement database building software to batch and track orders automatically and schedule order pickups. QuickBase for Corporate Workgroups software service increased efficiency and reduced errors. Demonstrates IT’s role in updating traditional business processes. Illustrates digital technology as the focus of designing and building new information systems. Management Information Systems Chapter 13 Building Systems

4. 13.4 © 2007 by Prentice Hall Systems as Planned Organizational Change Systems development and organizational change Business process reengineering Steps in effective reengineering Process improvement: Business process management, total quality management, and six sigma Business process management (BPM) Total quality management (TQM) Six sigma How information systems support quality improvements Management Information Systems Chapter 13 Building Systems

5. 13.5 © 2007 by Prentice Hall Systems development and organizational change Four kinds of structural organizational change that are enabled by IT: (i) Automation (ii) Rationalization (iii) Reengineering (iv) Paradigm shifts Management Information Systems Chapter 13 Building Systems

6. 13.6 © 2007 by Prentice Hall Systems development and organizational change (i) Automation, for example: Calculating paychecks & payroll registers Giving bank tellers instant access to customer deposits records Developing a nationwide network of airline reservation terminals for airline reservation agents Automation involved assisting employees with performing their task more efficiently and effectively. Management Information Systems Chapter 13 Building Systems

7. 13.7 © 2007 by Prentice Hall Systems development and organizational change (ii) Rationalization of procedures, for example: Managers redesign business processes, work flows, and user interfaces to the fulfillment software (Web services s/w). Rationalization of procedures: is a streamlining of standard operating procedures (SOP). Management Information Systems Chapter 13 Building Systems

8. 13.8 © 2007 by Prentice Hall Systems development and organizational change (iii) Business process reengineering: which business processes are analyzed, simplified, and redesigned. Organization can rethink and streamline their business processes to improve speed, service and quality. BPR reorganize work flows, combining steps to cut waste and eliminating repetitive, paper-intensive tasks. Management Information Systems Chapter 13 Building Systems

9. 13.9 © 2007 by Prentice Hall Systems development and organizational change (iv) Paradigm shifts: More radical form of business change Involve rethinking the nature of business and the nature of the organization. New IS can ultimately affect the design of the entire organization by transforming how the organization carries out its business or even the nature of the business. Management Information Systems Chapter 13 Building Systems

10. 13.10 © 2007 by Prentice Hall Organizational Change Carries Risks and Rewards Figure 13-1 The most common forms of organizational change are automation and rationalization. These relatively slow-moving and slow- changing strategies present modest returns but little risk. Faster and more comprehensive change—such as reengineering and paradigm shifts—carries high rewards but offers substantial chances of failure. Systems as Planned Organizational Change Management Information Systems Chapter 13 Building Systems

11. 13.11 © 2007 by Prentice Hall Figure 13-2 Redesigning Mortgage Processing in the U.S.

12. 13.12 © 2007 by Prentice Hall Figure 13-2 Redesigning Mortgage Processing in the U.S.

13. 13.13 © 2007 by Prentice Hall Process Improvement (i) Business Process Management: Enable organizations to manage incremental process changes that are required simultaneously in many areas of the business. It provides a methodology and tools for dealing with the organization’s ongoing need to revise and ideally optimize- its numerous internal business processes and processes shared with other organizations. BPM include workflow management, business process modeling, quality management, change management, tools for recasting the firm’s business processes into a standardized form. BPM include process monitoring & analytics. Management Information Systems Chapter 13 Building Systems

14. 13.14 © 2007 by Prentice Hall Process Improvement (ii) Total Quality Management : To make quality the responsibility of all people and functions within an organization. TQM holds that the achievement of QC is an end in itself. (iii) Six Sigma: Six Sigma : a specific measure of quality, representing 3.4 defects per million opportunities. Six Sigma uses statistical analysis tools to detect flaws in the execution of an existing process and make minor adjustments. Quality improvements not only raise the level of product and service quality, but they can also lower costs. Management Information Systems Chapter 13 Building Systems

15. 13.15 © 2007 by Prentice Hall Systems as Planned Organizational Change How information systems support quality improvements Simplify products or processes Make improvements based on customer demands Reduce cycle time Improve the quality and precision of design and products Benchmarking : consists of setting strict standards for products, services, and other activities, and then measuring performance against those standards. Companies may use external industry standards, standards set by other companies, and internally developed high standards. Management Information Systems Chapter 13 Building Systems

16. 13.16 © 2007 by Prentice Hall Read the Interactive Session: Organizations, and then discuss the following questions: What was wrong with the existing computer system (ALCS) and why did SBA decide to replace it? What was the purpose of re-organizing the ODA and centralizing IT in a single office, and centralizing other functions like the call center in a single office? In what other ways could the agency use information systems to improve the process of loan application, approval, and maintenance? Business Process Redesign at the Small Business Administration Systems as Planned Organizational Change Management Information Systems Chapter 13 Building Systems

17. 13.17 © 2007 by Prentice Hall Overview of Systems Development Systems analysis Establishing information requirements Systems design The role of end users Completing the systems development process Programming Testing Conversion Production and Maintenance Management Information Systems Chapter 13 Building Systems

18. 13.18 © 2007 by Prentice Hall The Systems Development Process Figure 13-3 Building a system can be broken down into six core activities. Overview of Systems Development Management Information Systems Chapter 13 Building Systems

19. 13.19 © 2007 by Prentice Hall Systems Development: System Analysis Analysis of the problem that the organization will try solve with an IS: Define the problem Identify its causes Specify the solution Identify the information requirements that must be met by a system solution Management Information Systems Chapter 13 Building Systems

20. 13.20 © 2007 by Prentice Hall Systems Development: System Analysis System analyst: Create a road map of existing organization & systems Identify the primary owners and users of data along with existing software and hardware. Details the problems of existing systems. Examine documents, work papers, and procedures Observing system operations. Interviewing key users of the systems Management Information Systems Chapter 13 Building Systems

21. 13.21 © 2007 by Prentice Hall Systems Development: System Analysis Feasibility study: Determine whether that solution was feasible, or achievable, from a financial, technical and organization standpoint. A written systems proposal reports describes the costs and benefits, advantages and disadvantages of each alternative. Management Information Systems Chapter 13 Building Systems

22. 13.22 © 2007 by Prentice Hall Systems Development: System Design System design: Describe what a system should do to meet information requirements, Show how the system will fulfill the objective. A design of an IS is : the overall plan or model for that system Consists of all the specifications that give the system its form and structure. Details of system specifications that will deliver the functions identified during system analysis Management Information Systems Chapter 13 Building Systems

23. 13.23 © 2007 by Prentice Hall Table 13-1 Design Specifications Management Information Systems Chapter 13 Building Systems OUTPUTPROCESSING Medium, Content, TimingComputations, Program modules, Required reports, Timing of outputs INPUTUSER INTERFACE Origin, Flow, Data EntrySimplicity, Efficiency, Logic, Feedback, Errors DATABASE DESIGNMANUAL PROCEDURES Logical data model Volume & speed requirements File organization and design Record specifications What activities Who performs them When How There

24. 13.24 © 2007 by Prentice Hall Table 13-1 Design Specifications (cont.) Management Information Systems Chapter 13 Building Systems CONTROLSSECURITY Input controls (characters, limit, reasonableness) Processing controls (consistency, record counts) Output controls (totals, samples of output) Procedural controls (passwords, special forms) Access controls Catastrophe plans Audit trails DOCUMENTATIONCONVERSION Operations documentation System documents User documentation Transfer files Initiate new procedures Select testing method Cut over to new system

25. 13.25 © 2007 by Prentice Hall Table 13-1 Design Specifications (cont.) Management Information Systems Chapter 13 Building Systems TRAININGORGANIZATIONAL CHANGES Select training techniques Develop training modules Identify training facilities Task redesign Job design Process design Organization structure design Reporting relationships

26. 13.26 © 2007 by Prentice Hall Systems Development: Programming, Testing Programming : System specifications that were prepared during the design stage are translated into software program code. Testing : Unit testing (program testing) System testing Acceptance testing Management Information Systems Chapter 13 Building Systems

27. 13.27 © 2007 by Prentice Hall Systems Development: Testing Testing type : Unit testing (program testing) Consists of testing each program separately in system The purpose is to guarantee that programs are error ree, A means of locating errors in programs System testing Test the functioning of the information system as a whole Examine the performance time, capacity for file storage, and handling peak loads, recovery and restart capabilities, and manual procedures. Management Information Systems Chapter 13 Building Systems

28. 13.28 © 2007 by Prentice Hall Systems Development: Testing Testing type : Acceptance testing Provides the final certification that the system is ready to be used in a production setting. System tests are evaluated by users and reviewed by management. When all parties are satisfied that new system meet their standards, the system is formally accepted for installation. Management Information Systems Chapter 13 Building Systems

29. 13.29 © 2007 by Prentice Hall Figure 13-4 A Sample Test Plan to test a record change Management Information Systems Chapter 13 Building Systems

30. 13.30 © 2007 by Prentice Hall Systems Development: Conversion Conversion: process of changing from the old system to the new system. Four main conversion strategies: Parallel strategy Direct cutover Pilot study Phased approach Management Information Systems Chapter 13 Building Systems

31. 13.31 © 2007 by Prentice Hall Systems Development: Conversion Strategies Parallel strategy Both old system and its potential replacement are run together for a time until everyone is assured that the new one functions correctly. Direct cutover strategy Replaces the old system entirely with the new system on an appointed day. Pilot study strategy Introduces the new system to only a limited area of the organization, such as a single department or operating unit. Phased approach strategy Introduces the new system in stages, either by functions or by organizational units. Management Information Systems Chapter 13 Building Systems

32. 13.32 © 2007 by Prentice Hall Systems Development: Production & Maintenance Production The system will be reviewed by both users and technical specialists to determine how well it has met its original objectives and to decide whether any revisions or modifications are in order. Maintenance Includes changes in hardware, software, documentation, or procedures to a production system to correct errors, meet new requirements, or improve processing efficiency. 20%  time for debugging or correcting emergency problems. 20%  time for changing in data, files, reports, hardware, or system software. 60%  time for making user enhancements, improving documentation, and recoding system components for greater processing efficiency. Management Information Systems Chapter 13 Building Systems

33. 13.33 © 2007 by Prentice Hall Table 13-2 Systems Development Management Information Systems Chapter 13 Building Systems Core ActivityDescription System analysisIdentify problems Specify solutions Establish information requirements System designCreate design specifications ProgrammingTranslate design specifications into program code TestingUnit test System test Acceptance test ConversionPlan conversion Prepare documentation Train users and technical staff Production and maintenanceOperate the system Evaluate the system Modify the system

34. 13.34 © 2007 by Prentice Hall Overview of Systems Development Modeling and designing systems: Structured and object-oriented methodologies Structured methodologies Object-oriented development Computer-aided software engineering Management Information Systems Chapter 13 Building Systems

35. 13.35 © 2007 by Prentice Hall Figure 13-5 DFD for Mall-In University Registration System Management Information Systems Chapter 13 Building Systems

36. 13.36 © 2007 by Prentice Hall High-Level Structure Chart for a Payroll System This structure chart shows the highest or most abstract level of design for a payroll system, providing an overview of the entire system. Figure 13-6 Management Information Systems Chapter 13 Building Systems

37. 13.37 © 2007 by Prentice Hall Class and Inheritance Figure 13-7 This figure illustrates how classes inherit the common features of their superclass. Overview of Systems Development Management Information Systems Chapter 13 Building Systems

38. 13.38 © 2007 by Prentice Hall Alternative Systems-Building Approaches Traditional systems life cycle Prototyping Steps in prototyping Advantages and disadvantages of prototyping End-user development Application software packages and outsourcing Management Information Systems Chapter 13 Building Systems

39. 13.39 © 2007 by Prentice Hall Alternative Systems-Building Approaches Prototyping Is a working version of an I.S. or part of the system, but it is meant to be only a preliminary model. Steps in prototyping 1.Identify the user’s basic requirements 2.Develop an initial prototype 3.Use the prototype 4.Revise and enhance the prototype Management Information Systems Chapter 13 Building Systems

40. 13.40 © 2007 by Prentice Hall Figure 13-8 The Prototyping Process Management Information Systems Chapter 13 Building Systems

41. 13.41 © 2007 by Prentice Hall Rapid application development (RAD) Describe process of creating workable systems in a very short period of time. Include the use of visual programming and other tools for building graphical user interfaces. Application Development for the Digital Firm Management Information Systems Chapter 13 Building Systems

42. 13.42 © 2007 by Prentice Hall Read the Interactive Session: Management, and then discuss the following questions: What is the basis for vendor firms claiming they can provide IT services more economically than a firm’s own IT staff? Why is it difficult to write iron-clad legal contracts specifying in detail strategic alliance outsourcing relationships? Why do joint ventures and co-sourcing outsourcing relationships have a better chance of success? How to Get Outsourcing Right: Avoid Getting It Wrong Application Development for the Digital Firm Management Information Systems Chapter 13 Building Systems