Chapter8
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The document discusses building information systems and managing projects. It covers the core problem-solving steps for developing new information systems, alternative methods for building information systems like prototyping and end-user development, principal methodologies for modeling and designing systems, selecting and evaluating information systems projects, and managing information systems projects. The objectives of project management are discussed, including keeping projects on schedule, within budget, and meeting quality standards. Methods for selecting projects, managing risks, and understanding business value are also covered.
Chapter8
- 1. 11.1 Copyright © 2011 Pearson Education, Inc. 8/11Chapter Building InformationBuilding Information Systems and ManagingSystems and Managing ProjectsProjects
- 2. 11.2 Copyright © 2011 Pearson Education, Inc. STUDENT OBJECTIVES Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems • What are the core problem-solving steps for developing new information systems? • What are the alternative methods for building information systems? • What are the principal methodologies for modeling and designing systems? • How should information systems projects be selected and evaluated? • How should information systems projects be managed?
- 3. 11.3 Copyright © 2011 Pearson Education, Inc. 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. Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8 Building Information SystemsChapter 8 Building Information Systems
- 4. 11.4 Copyright © 2011 Pearson Education, Inc. A New Ordering System for Girl Scout Cookies • Intuit’s QuickBase for Corporate Workgroups software service increased efficiency and reduced errors for a fraction of what competing options cost. • Demonstrates IT’s role in updating traditional business processes. • Illustrates digital technology as the focus of designing and building new information systems. Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 5. 11.5 Copyright © 2011 Pearson Education, Inc. A New Ordering System for Girl Scout Cookies Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 6. 11.6 Copyright © 2011 Pearson Education, Inc. Problem Solving and Systems Development • New information systems are built as solutions to problems • Four steps to building an information system • Define and understand the problem. • Develop alternative solutions. • Choose a solution. • Implement the solution. • The first three steps are called systems analysis Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 7. 11.7 Copyright © 2011 Pearson Education, Inc. Figure 11-1 Developing an information system solution is based on the problem- solving process. Problem Solving and Systems Development Developing an Information System SolutionDeveloping an Information System Solution Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 8. 11.8 Copyright © 2011 Pearson Education, Inc. Defining and Understanding the ProblemDefining and Understanding the Problem • What caused the problem? • Why does it persist? • Why hasn’t it been solved? • What are the objectives of a solution? • Information requirements Problem Solving and Systems Development Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 9. 11.9 Copyright © 2011 Pearson Education, Inc. Problem Solving and Systems Development Developing Alternative SolutionsDeveloping Alternative Solutions • Paths to a solution determined by systems analysis. • Some solutions do not require an information system. • Some solutions require modification of existing systems. • Some solutions require new systems. Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8/11 Building Information SystemsChapter 8/11 Building Information Systems
- 10. 11.10 Copyright © 2011 Pearson Education, Inc. Evaluating and Choosing SolutionsEvaluating and Choosing Solutions • Feasibility issues • Feasibility study • Costs and benefits • Advantages and disadvantages • Business value of systems • Change management Problem Solving and Systems Development Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 11. 11.11 Copyright © 2011 Pearson Education, Inc. Implementing the SolutionImplementing the Solution • Systems design • Completing implementation • Hardware selection and acquisition • Software development and programming • Testing • Training and documentation • Conversion • Production and maintenance • Managing the change Problem Solving and Systems Development Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 12. 11.12 Copyright © 2011 Pearson Education, Inc. Figure 11-2 When developing a test plan, it is imperative to include the various conditions to be tested, the requirements for each condition tested, and the expected results. Test plans require input from both end users and information systems specialists. A Sample Test Plan for the Girl Scout Cookie SystemA Sample Test Plan for the Girl Scout Cookie System Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 13. 11.13 Copyright © 2011 Pearson Education, Inc. Traditional Systems Development LifecycleTraditional Systems Development Lifecycle Alternative Systems-Building Approaches • Oldest method for building information systems • Phased approach with formal stages • Waterfall approach • Formal division of labor • Used for building large, complex systems • Time consuming and expensive to use Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 14. 11.14 Copyright © 2011 Pearson Education, Inc. Figure 11-3 The systems development lifecycle partitions systems development into formal stages, with each stage requiring completion before the next stage can begin. The Traditional Systems Development LifecycleThe Traditional Systems Development Lifecycle Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 15. 11.15 Copyright © 2011 Pearson Education, Inc. PrototypingPrototyping • Preliminary model built rapidly and inexpensively • Four-step process • Identify the user’s basic requirements. • Develop an initial prototype. • Use the prototype. • Revise and enhance the prototype. • Especially useful in designing a user interface Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 16. 11.16 Copyright © 2011 Pearson Education, Inc. Figure 11-4 The process of developing a prototype consists of four steps. Because a prototype can be developed quickly and inexpensively, systems builders can go through several iterations, repeating steps 3 and 4, to refine and enhance the prototype before arriving at the final operational one. The Prototyping ProcessThe Prototyping Process Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 17. 11.17 Copyright © 2011 Pearson Education, Inc. End-User DevelopmentEnd-User Development Alternative Systems-Building Approaches • End users create simple information systems with little or no assistance from technical specialists. • Use fourth-generation languages, graphics languages, and PC software tools to access data, create reports, and develop information systems. • Completed more rapidly than systems developed with conventional tools • Organizational risks Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 18. 11.18 Copyright © 2011 Pearson Education, Inc. End-User DevelopmentEnd-User Development • Allows end users to create simple information systems • Reduces time required to produce a finished application • Often leads to higher level of user involvement and satisfaction with systems • Also poses risks because systems are created so quickly, without formal development methodology, testing, documentation Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 19. 11.19 Copyright © 2011 Pearson Education, Inc. Purchasing Solutions: Application Software PackagesPurchasing Solutions: Application Software Packages and Outsourcingand Outsourcing • Request for Proposal (RFP) • Application software packages • Generalized systems for universal functions with standard processes • Customization • Outsourcing • Application service providers (ASPs) • Offshore outsourcing Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 20. 11.20 Copyright © 2011 Pearson Education, Inc. Figure 11-5 If a firm spends $10 million on offshore outsourcing contracts, that company will actually spend 15.2 percent in extra costs even under the best-case scenario. In the worst-case scenario, where there is a dramatic drop in productivity along with exceptionally high transition and layoff costs, a firm can expect to pay up to 57 percent in extra costs on top of the $10 million outlay for an offshore contract. Total Cost of Offshore OutsourcingTotal Cost of Offshore Outsourcing Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 21. 11.21 Copyright © 2011 Pearson Education, Inc. Interactive Session: TechnologyInteractive Session: Technology Zimbra Zooms Ahead with OneViewZimbra Zooms Ahead with OneView • Read the Interactive Session and then discuss the following questions: • Describe the steps in Zimbra’s sales process. How well did its old marketing automation system support that process? What problems did it create? What was the business impact of these problems? • List and describe Zimbra’s requirements for a new marketing software package. If you were preparing the RFP for Zimbra’s new system, what questions would you ask? • How did the new marketing system change the way Zimbra ran its business? How successful was it? Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 22. 11.22 Copyright © 2011 Pearson Education, Inc. Rapid Application Development for E-BusinessRapid Application Development for E-Business • Agility and scalability • Rapid application development (RAD) • Creating workable systems in a very short period of time • Joint application design (JAD) • End users and information systems specialists working together on design Alternative Systems-Building Approaches Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 23. 11.23 Copyright © 2011 Pearson Education, Inc. • Structured methodologies • Data flow diagram • Process specifications • Structure chart • Object-oriented development • Based on concepts of class and inheritance • Component-based development and Web services • Computer-aided software engineering (CASE) Modeling and Designing Systems Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 24. 11.24 Copyright © 2011 Pearson Education, Inc. Figure 11-6 The system has three processes: Verify availability (1.0), Enroll student (2.0), and Confirm registration (3.0). The name and content of each of the data flows appear adjacent to each arrow. There is one external entity in this system: the student. There are two data stores: the student master file and the course file. Data Flow Diagram for Mail-in UniversityData Flow Diagram for Mail-in University Registration SystemRegistration System Modeling and Designing Systems Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 25. 11.25 Copyright © 2011 Pearson Education, Inc. Figure 11-7 This structure chart shows the highest or most abstract level of design for a payroll system, providing an overview of the entire system. High-Level Structure Chart for a Payroll SystemHigh-Level Structure Chart for a Payroll System Modeling and Designing Systems Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 26. 11.26 Copyright © 2011 Pearson Education, Inc. Project Management ObjectivesProject Management Objectives Project Management • Project • Planned series of related activities for achieving a specific business objective • Project Management • Application of knowledge, skills, tools, and techniques to achieve targets within specified budget and time constraints • Scope • Time • Cost • Quality • Risk Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 27. 11.27 Copyright © 2011 Pearson Education, Inc. Selecting Projects:Selecting Projects: Making the Business Case for a New SystemMaking the Business Case for a New System Project Management • Determining project costs and benefits • Tangible benefits • Intangible benefits • Capital budgeting methods • Information systems plan • Portfolio analysis • Scoring model Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 28. 11.28 Copyright © 2011 Pearson Education, Inc. Figure 11-9 Companies should examine their portfolio of projects in terms of potential benefits and likely risks. Certain kinds of projects should be avoided altogether and others developed rapidly. There is no ideal mix. Companies in different industries have different information systems needs. A System PortfolioA System Portfolio Project Management Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 29. 11.29 Copyright © 2011 Pearson Education, Inc. Managing Project Risk and System-Related ChangeManaging Project Risk and System-Related Change • Implementation and change management • Implementation • User-designer communications gap • Controlling risk factors • Formal planning and tools • Gantt Chart • PERT chart • Overcoming user resistance • Ergonomics • Organizational impact analysis Understanding the Business Value of Systems and Managing Change Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 30. 11.30 Copyright © 2011 Pearson Education, Inc. Figure 11-10A A Gantt ChartA Gantt Chart Project Management The Gantt chart in this figure shows the task, person-days, and initials of each responsible person, as well as the start and finish dates for each task. The resource summary provides a good manager with the total person-days for each month and for each person working on the project to manage the project successfully. The project described here is a data administration project. Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 8 Building Information SystemsChapter 8 Building Information Systems
- 31. 11.31 Copyright © 2011 Pearson Education, Inc. Figure 11-10B A Gantt ChartA Gantt Chart Project Management Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 32. 11.32 Copyright © 2011 Pearson Education, Inc. Figure 11-11 A Gantt ChartA Gantt Chart Project Management This is a simplified PERT chart for creating a small Web site. It shows the ordering of project tasks and the relationship of a task with preceding and succeeding tasks. Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 33. 11.33 Copyright © 2011 Pearson Education, Inc. Managing Projects on a Global ScaleManaging Projects on a Global Scale • Project challenges for global systems are complicated by international environment • User info requirements, business processes, work cultures vary from country to country • Ways of convincing users to adopt global systems: • Permitting each country unit in a global corporation to develop one application in its home country first. • Develop transnational centers of excellence to perform business and systems analysis, design, testing. Understanding the Business Value of Systems and Managing Change Essentials of Management Information SystemsEssentials of Management Information Systems Chapter 11 Building Information SystemsChapter 11 Building Information Systems
- 34. 11.34 Copyright © 2011 Pearson Education, Inc. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2011 Pearson Education, Inc.Copyright © 2011 Pearson Education, Inc.
Editor's Notes
- #2: There are two video cases and one instructional video available for this chapter: Case 1 IBM: Business Process Management in a Service-Oriented Architecture Case 2 Startup Appcelerator For Rapid Rich App Development Instructional Video 1 Salesforce and Google: Developing Sales Support Systems with Online Apps
- #3: This chapter discusses the activities involved in systems development and the various methodologies used to build information systems. Ask students to give their first impressions on how a new information system could produce organizational change. Give an example of a type of business and a new system, for example, a business that introduces an automated call-answering system to direct sales and technical inquiries to the right department.
- #7: It is important to emphasize that an information system is not technology for technology’s sake, it is a solution to a problem or set of problems the organization perceives it is facing— including the problem of an opportunity that requires the use of information systems in order to undertake. What problems with business processes have students encountered or witnessed in their work or educational career that could have been improved with the help of a new or improved information system?
- #8: Emphasize the distinction between the orange boxes (systems analysis) and the blue box (implementation): why doesn’t implementation fall into the category of systems analysis? (Because the analysis has already been performed and a solution has been chosen; the final task is to actually create the planned solution.)
- #9: These are critical questions that businesses must ask as they begin to plan for the creation of a new information system. What would the result be if these questions were not thoroughly considered and answered prior to construction of the system?
- #10: What types of solutions might not require an information system to fix? Sometimes, existing information systems are sufficient, but users may not be sufficiently trained to use them, for example.
- #11: What does it mean that a solution is feasible from a financial standpoint? A technical standpoint? An organizational standpoint?
- #12: Systems building is not a linear process that is finished once the system is built. Typically, additional changes and improvements will need to be made to the system or part of the system that will require additional analysis, design, programming, testing, conversion, and maintenance.
- #13: Explain that the above figure represents just a sample of a full test plan, which would consist of similar tests for all of the major functions of the information system.
- #14: This slide describes the first method for building systems, the traditional systems lifecycle. Ask students what the effects of unanticipated user requirements are when using this type of building method. What is the role of end users in this method?
- #15: What types of systems are well-suited to the traditional systems development lifecycle? One answer is larger, complex systems requiring rigorous and formal requirements analysis and tight controls. What types of systems are not well-suited? Smaller, more individualized desktop systems are not suited for a traditional design process.
- #16: Prototyping is an explicitly iterative process. The term iterative has been used several times; ask students to describe what this means (steps to build the system can be repeated over and over). What are the benefits of an iterative process? Note that once no more iterations are needed, the prototype becomes the finished specifications for the final application, or may serve as the production version of the application. Ask students to explain potential advantages and disadvantages of prototyping. For example, why is prototyping useful if there is uncertainty in requirements? What kinds of essential steps might be glossed over?
- #17: This graphic illustrates the four steps (rectangles) of prototyping. The steps that are repeated are steps 3) Use the prototype and 4) Revise and enhance the prototype. Would this type of system development be appropriate for developing a large, enterprise management system?
- #18: What types of projects might end-user development be most suited for? How might this type of development result in a loss of control over data?
- #20: It is important to note that many functions are common to all business organizations—payroll, accounts receivable, or inventory control. Software packages will fulfill the need for many organizations for these types of functions. However, it is still important to perform systems analysis in order to determine your organization’s requirements for a system. It is important to emphasize the amount of work involved in partnering and sharing work with a vendor. It may take anywhere from three months to a year to fully transfer work to a vendor. What other types of hidden costs can students identify?
- #21: This graphic looks at the best and worst case scenarios regarding hidden costs in outsourcing. The best case column shows the lowest estimates for additional costs, and the worst case reflects the highest estimates for these costs. In the Additional Cost column at the lower right, you can see that hidden costs increase the total cost of an offshore outsourcing project by an extra 15 to 57 percent. However, it is important to note that even with these extra hidden costs, many firms will benefit from offshore outsourcing if they manage the work well.
- #23: Rapid application development is one of several methods that emphasize providing fast solutions needed in an increasingly digital world. What elements in RAD are similar to building methods already discussed—CASE tools, prototyping, and so on?
- #24: It is important to emphasize that object-oriented development can reduce the time and cost of development through reusing objects and classes from one application for other applications.
- #25: This graphic is a data flow diagram. Ask students what the rounded boxes represent (processes) and what the square box represents (an external entity). What about the open rectangle and the arrows? Where does the process begin? Ask a student to step through the process of registering a student for a course, noting what data is transferred at each step. It’s always fun to do data flow diagrams as a group because it illustrates how the same process is seen differently by different people.
- #27: Information systems offer powerful solutions, but only if they can be implemented in a timely and economic fashion. Project management is the art of bringing together the skills and talents of a business firm to achieve some well defined objectives. The main dimensions of project management are given in the slide above. Ask students what has been their experience working on projects, or perhaps as project managers.
- #28: Projects are developed often for reasons that have nothing to do with the benefits to the firm. One of the more difficult tasks of management is to choose which of many projects should be developed, and how to rank order them in terms of positive impacts on the firm. Intangible benefits are often difficult to quantify, and yet may be the most important ultimately in terms of revenues and earnings.
- #30: Ask students if any have had experience with failed system projects, or worked with systems that were poorly designed. What factors do they think were involved?
- #34: Global systems are difficult both because of the different cultures involved, but also because of the scale of operations. One global system that has done fairly well is the international air traffic control system. Even here however there are a number of issues related to culture. Pilots not understanding the control tower, and vice versa; in some cultures, co-pilots and navigators afraid to question the captain’s judgment even when he or she is wrong.