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Summary Articles Management Information Systems (EBC2003)
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Mastering the world of three information technologiesIT is getting better and faster and companies spend as much on IT as they do on warehouses
and offices. But it is overwhelming for general managers to uncover what all the systems
mean, what they do, and which is the best. They are less curious about IT projects and
neglect their knowledge difficult to align business strategy with IT systems, much people
do not have faith in IT projects. Many managers argue they should lower expenditures or
outsource the IT management. However, they abide a critical strategy in which managers
have 3 responsibilities:
1. They must help select technologies
2. Nurture their adoption
3. Ensure the exploitation
Each IT systems requires a different role as each system brings a different organisational
change and requires different responsibilities should not be seen as technology
installations but as change.
Building an effective IT model
Technology projects are becoming a challenge for managers but there commitment is
required to make IT systems a success do not know when, how, and where to get
involved. This is because there is no comprehensive model of IT systems, only some bold
statements that work as sales pitches needs to group phenomena into categories and in
each category cause and effect must be clear. The existing models do not help make a choice
and do not tell why a certain technology causes what it does. IT must be seen as a GPT
become more familiar with it, let go of old thinking habits and find great uses. People need
to develop complements through organisational change that further enhance GPT: better-
skilled workers, higher level teamwork, redesigned processes, and new decision rights.
But IT system work differently as some do not require the previous complements, some only
function when they do, and some allow complements to emerge over time. This allows IT to
be classified into 3 categories with different capabilities, different benefits, different
organisational changes, and different approaches.
The three categories of IT
1. Function IT: IT that assists with the execution of discrete tasks to make it more efficient
used by specialists and knowledge workers, most efficient when complements are in place
but not required. FIT does not specify what type of complements it needs, firms need to
develop it themselves and uncover it. Ducati was used as an example and shows the
capabilities of FIT:
-Enhancing experimentation capacity: create multiple designs with software
-Increasing precision: trust in software
2. Network IT: IT that facilitates interactions and connections with one another without
specifying their parameters, no rules on how to interact NIT brings complements with it
but these are also modified and adapted over time. It is optional to use. DKW showed
capabilities of NIT:
-Facilitating collaboration: work together as a team without defining who should work with
,whom and in what way
-Allowing expressions of judgement: blogs for opinions
-Fostering emergence: appearance of high-level patterns or information because of low-level
interactions compare how work is done with how it is supposed to be done.
3. Enterprise IT: IT that specifies business processes to restructure interactions among
groups of employees or business partners implemented top-down. It requires introducing
new interdependencies, processes, and decision rights and requires quick change. The use is
mandatory, it defines sequence and tasks, and requires data formats. CVS redesigned their
pharmacy pick-up process, uncovering the capabilities of EIT:
-Redesigning business processes: employees execute process correctly
-Standardise work flows: identify complementary business process to be implemented with
the EIT which makes it reliable
-Monitoring events and activities efficiently
Managing three types of IT
For each category, managers have 3 tasks:
1. IT selection: often, IT is selected after an executive has heard of it or everyone else in the
industry is adopting it endless supply due to innovation and rebranding so cannot review
all of it. Furthermore, managers take an outside-in view, they do not consider whether the IT
brings the capabilities they need money to waste. Firms should take an inside-out view,
what are our IT priorities and where do we need the IT for. You need to clarify business
needs and capabilities, then the technology will come into focus. FIT delivers productivity
and optimisation, NIT collaboration, and EIT standardisation and monitoring. CISCO provided
an example. Sometimes implementing this takes lots of time and investment but will bring
you the capabilities you need. Leaders should meet regularly to review what technology is
required, how widely it will be implemented, and how much time and money it will cost
no ROI analysis as this is useless.
2. IT adoption: put selected IT into use managers must create the complements that will
optimise the IT. For FIT, this means creating new processes and complements, they will not
just come. NIT is not mandatory and therefore makes it users more in control over the usage
which requires less intervention into the adoption only show how to appropriately use, do
not intervene too much. EIT looks very advantageous to top managers but difficult to
implement because lower-level employees feel that it brings lots of change and are dictated
to adopt executives often unaware of the resistance it will bring. This can delay some EIT
implementation, does not allow you to fully exploit the benefits and capabilities it needs to
bring, abandon the system, or continue using it the wrong way which lets performance
suffer. It is important that from the start you decide how to settle conflicts, you need a
seasoned leader who is ready to make the tough decisions and has the authority to do so.
You try to build consensus but keep pushing project even though not everyone is on board.
3. IT exploitation: extract maximum benefit once technology is in place. For FIT this means
fine-tuning the complements. NIT gets successfully implemented by guiding employees and
users how to make use of the systems. EIT exploitation is easier than adoption because
people are now eager to use all the new processes that were so hard to implement and
,standardise the work sometimes add on FIT. It is even more exploited by extending the
systems to your partners, suppliers, and vendors would otherwise only be achieved by
hiring more people.
Resources must adhere the VRIO framework to become of value. It is not about the software
itself but the successful implementation that will become an asset to the firm and turns into
a capability that will be helpful.
, Methodologies for custom software development
Until the 1980, many Information systems were developed in-house or external vendors
were hired to tailor it to the firm itself. This has changed over the years, but custom software
development skills are still in high demand.
Systems development life cycle methodology
A systems life cycle process consists of definition, construction, and implementation. The life
cycle process of developing customised applications is the systems development life cycle.
The generic SDCL process includes 3 phases and 8 steps can differ between firms:
1. Definition: justifies the systems development work and defines precisely what system
must do in sufficient detail for IS specialists to build the right system. Includes requirements
definition and feasibility analysis. The requirements step is the costliest prevent future
mistakes.
2. Construction: IS specialists produce a working system according to specifications set forth
in earlier phase. At the end of each step, major formal reviews are done for the design,
building and testing without approval no continuance.
3. Implementation: new system is installed, becomes operational within organisation, and
maintained as needed to continue reflecting changes in organisation ongoing operations
and maintenance costs. In earlier years, only deep failures have caused firms to replace their
existing IS system, some had ones that were modified but decades old.
The methodology requires lots of documentation and we can see that the output from one
stage is the input for the next.
Initiating new systems projects
To decide which new applications to invest in, a few steps are undertaken:
1. Business department files for business approval depending on resource requirement
who approves is dependent and how many times proposal are approved
2. Proposal describes need of software application, benefits, risks, costs, and scope design
requirements
3. Proposal approved, resources allocated, and start of the SDCL process. This is done based
on incremental commitment, program reviewed after each phase with options to continue
or terminate project review each phase.
Definition phase
The definition phase consists of 2 steps:
1. Feasibility analysis: project manager and team of system analysts assess economic,
operational, and technical feasibility. IS and business analysts assess scope and boundaries
of system, what it will do, what outputs and inputs are required and will provide, and what
data bases are required. IS managers look at the technical feasibility, is the IT expertise and
infrastructure adequate within firm. The operational feasibility is about whether it address
the opportunities for the firm and helps develop its capabilities. The economic feasibility is
determined on a cost-benefit analysis benefits can be intangible or saved costs; costs
require a planning which can take months and difficult because projects are new. Each
project carries risk, often firms create a portfolio with high and low risks and high and low
net value high risk and low reward not approved. All outcomes are summarised in a
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