1. Zen & the Art of Economic $ Economic Analysis & Systems Analysis The University of California Berkeley Extension pmcdermott@msn.com Copyright © 2007 Patrick McDermott McDermott, Patrick, Zen and the Art of Systems Analysis: Meditations on Computer Systems Development, New York: iUniverse (0-595-25679-1), 2003 (2002).

2. What’s I.S. Goal? Efficiency –Faster, Cheaper –Save Time –Doing things Right Effectiveness –Better, Smarter –Information as an Asset –Doing the Right Thing –“ It’s no use running faster if you’re on the wrong track. ” Innovation –New Area –Something You Didn’t do Before –Doing New Things Optimist: The Glass is half Full Pessimist: The Glass is half Empty Economist: The glass is 50% efficient

3. Internet Categories  Content –Entertain or Inform: Eyeballs  Community –Social YouTube, Amazon reviews  Commerce –Sell, Sell, Sell Meta Categories –ISPs –Portals –Web Services “Both Magritte and Escher use realism in exploring the worlds of paradox and illusion; both have a sure sense for the evocative power of certain visual symbols, and—something which even their admirers often fail to point out—both of them have a sure sense of the graceful line.” —Crab (Douglas Hofstadter, GEB)

4. Planning Paradox  Companies that plan are more successful than those that don’t. But companies that actually follow their plans are less successful than those that do not follow their plan.  Target Seeking Arrows  The Most Common Plan:  A Budget Target with Four Faces Jasper Johns, c. 1955

5. Quality Control The original meaning of QC: “As good as it needs to be, and NO BETTER.” What’s a few Bugs between friends? Steve Ballmer’s $2 million bug cleanup Yourdon’s “Good Enough” Software –  Zero Defects,  6  Yourdon, Edward, Rise & Resurrection of the American Programmer, Upper Saddle River, New Jersey: Yourdon Press (0-13-121831-X), 1996.

6. The Terrible Twins  Analysis Paralysis –The Winchester Mystery Model –Its own (first class) airplane seat  Scope Creep –“ The main thing is to keep the main thing the main thing. ” —James Thurber –Just say “No” –Allow 10% –Re-negotiate

7. Self-Fulfilling Prophecies When people believe something is going to happen, because of their belief, they can unintentionally cause the event to actually happen Run on a Bank Stock Market goes Up or Down Project Succeeds or Fails

8. Measuring Distorts Never use an Indicator as an Evaluator –Army Spit Shine –Phone Calls (Mis-)Handled –Lines of Code –More Time Testing –Teach to the Test –Heisenberg Uncertainty Principle “Observing changes the Observed” “ Not everything that can be counted counts, and not everything that counts can be counted. ” — Albert Einstein

9. Mallory vs. Hillary Who was first to climb Mount Everest? George Mallory (1886-June 8,1924) –“ Because it is There! ” –And he’s still There Edmund Hillary & Sherpa Tenzing Norgay –May 29, 1953 –No doubt: The 1 st Successful Climb Always consider the Costs

10. Economic Costs  Fixed Cost versus Variable Cost –Periodic vs. Per Unit –Systems are usually fixed cost Even if broken!  Sunk Costs are Junk Costs –Don’t Throw Good Money after Bad  Opportunity Cost –What Might Have Been $ ￠ ￥ ￡ ￦ €

11. Learning Curve  Like The Ugly American, who was not Ugly inside  “Steep learning curve” means it’s easy to learn

12. Mix Apples & Oranges Apples and Oranges are Comparable –A Small, inexpensive fruit –Good School Lunch Choice –Make Delicious Fruit Salad Paul Cézanne (1839-1906) Apples & Oranges, 1895 This is not a PC: René Magritte (1898-1967) Ceci n'Est Pas une Pomme "This is not an Apple", 1964 René Magritte (1898-1967) La Chambre d'écoute ”The Listening Room”, 1952