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InformationSystems Planning

11

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Table 11.1Owens Corning Reorients Its Operations

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Table 11.1Owens Corning Reorients Its Operations

CUSTOMER

Building supply companies and contractors that purchase building materials from Owens Corning

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Table 11.1Owens Corning Reorients Its Operations

PRODUCT

Reengineered work systems that aremore responsive to market needs

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Table 11.1Owens Corning Reorients Its Operations

BUSINESS PROCESS

Major steps:

•Create a vision for how company operations should change

•Select SAP R/3 as the approach for improving information systems

•Create a large project team at headquarters

•Analyze how to use SAP

•Install SAP on computers

•Train people to use it

•Use SAP in practice

Rationale:

Replace multiple, incompatible information systems with an integrated information system that makes it possible to serve customers more effectively.

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Table 11.1Owens Corning Reorients Its Operations

PARTICIPANTS

Project team consisting of half business professionals and half IS professionals

Users who were trained and then used the new information system

INFORMATION

Company strategy

Project goals

Details of business operations

Selected options for using SAP

TECHNOLOGY

SAP R/3 software package

Computers and other hardware

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Table 11.2Planning Questions for Information Syatems

WHO?Strategic level•What are the responsibilities of the IS department and the user departments?•Which vendors will perform major functions that are outsourced?Project level•Who will work on each project?•Who will decide how the business process should operate?•Who will manage and support the system after it is in operation?

WHAT?Strategic level•What are the major things that the IS department must do so that the firm can accomplish its goals?Project level•What specific capabilities are required in the information system?•What will be the individual steps in each project?

WHEN?Strategic level•What are the major completion dates that the firm can rely upon?Project level•When will the individual steps in each project be completed?

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Table 11.2Planning Questions for Information Syatems

HOW?Strategic level•What technology will be used to do the work?•What technology must be available so that the work can be done well?•What capabilities must the firm have to compete in the future?Project level•How will system development techniques be used to produce the desired results?•How will the IS department and user departments work together on the project?

DESIRED RESULTS?Strategic level•How will business processes change in terms of detailed operation and controllable results?Project level•What will be the deliverable results from each step in each project?

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Figure 11.1The information system plan as part of the business plan

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Box 11.1Roles of information system professionals in building and maintaining information systems

Large system development projects involve many roles such as the following.

•Project managers

•Application programmers

•Systems analysts

•Programmer-analysts

•Technical writers

•Computer operators

•Database administrators

•System managers

•Systems programmers

•User support staffs

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Figure 11.3Strategic alignment of business and IT

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Table 11.3Centralization Verseus Decentralization

HARDWARE CONFIGURATIONHighly centralized- Central computer, remote terminalsIntermediate- Distributed network linking local data centersHighly decentralized- Independent local data centers, personal computers

DATA LOCATIONHighly centralized- Centralized databaseIntermediate- Central database plus local databasesHighly decentralized- Local databases

HARDWARE AND SOFTWARE CHOICESHighly centralized- Central decisionsIntermediate- Central guidelines, local choicesHighly decentralized- Local choices

OWNERSHIP AND CONTROLHighly centralized- Central information systems groupIntermediate- Central services, system ownership by user departmentsHighly decentralized- User departments

ORGANIZATIONAL AFFILIATION OF IS STAFFHighly centralized-Central IS groupIntermediate- Highly technical IS roles affiliated with central group, less technical roles in user organizationHighly decentralized- Most IS roles affiliated with user organization (except infrastructure and planning)

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Figure 11.4Immediate degree of distributed processing

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Table 11.4Commonly Cited Differences between IS Professionals and Typical Users

PROFESSlONAL ORIENTATIONIS staff: Allegiance to professionUser department: Allegiance to firm

LANGUAGEIS staff: Language of computersUser department: Language of business

INTERESTS AND RECOGNITIONIS staff: Technical eleganceUser department:Practical solutions produced quickly

PROJECT GOALSIS staff: Long-term maintenanceUser department: Practical solutions produced quickly

WORK STYLE AND CONTENTIS staff: Analytical work related to computersUser department: Work through people

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Figure 11.5Typical elements of IT infrastructure

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Table 11.5Business and IT Maxims for a Hypothetical Chain of Hardware Stores

BUSINESS MAXIMSCost focus:•Low cost retailer for consumersValue differentiation perceived by customer:•Low prices supported by reasonably good service.•Reliable availability of medium to low priced hardware and building supplies.•Major distrubutor for particular suppliers and brands.Flexibility and agility: •Stay focused in hardware market, expand slowly into related products for kitchens and gardens.•Detect and exploit trendy new products.Growth:•Gradually expand across the United States and Canada.•Grow revenues using targeted discounts to bring back customers for repeat purchases. Human Resources: •Staff stores with people who enjoy home remodeling projects.•Maintain pleasant work environment but assume high turnover in store personnel due to relatively low salaries.Management orientation:•Maximize ability to satisfy needs of local markets.•Support stores with standardized systems and information, but permit local autonomy in decision making.•Share information about hot products and trends.

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Table 11.5Business and IT Maxims for a Hypothetical Chain of Hardware Stores

IT MAXIMS

Expectations for IT investments:•IT investments provide common infrastructure and systems to minimize these concerns for the local stores.

Data access and use:•All sales data available to central purchasing nightly.•Local access to local customer and prospect list, plus corporate access for data mining and analysis.

Hardware and software resources: •Support consistent, automatic processing of repetitive transactions.•Standardize on minimum number of platforms to minimize cost of support.

Communications capabilities and services:•Support nightly consolidation of daily sales transactions to help identify product and pricing trends.•Support EDI to minimize transaction costs.

Architecture and standards approach:•Control IT architecture and standards centrally to minimize cost.

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Figure 11.6American and French electrical plugs

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Table 11.6IS Costs That Are Easy to Overlook

INITIATIONCosts easily assigned to a project: •Salary and overhead for IS staff•Cost of communication and travel related to the project•Consulting fees (if any)Costs that are easy to overlook:•Salary and overhead of user staff and management involved in the analysis•Other work that is displaced in favor of work on the project

DEVELOPMENTCosts easily assigned to a project:•Salary and overhead for IS staff•Equipment purchase and installation costs•Purchase (if any) of system or application softwareCosts that are easy to overlook:•Salary and overhead of user staff and management involved in the analysis•Site modifications such as wiring offices

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Table 11.6IS Costs That Are Easy to Overlook

IMPLEMENTATIONCosts easily assigned to a project:•Salary and overhead for IS staff and trainers•Cost of communication and travel related to the projectCosts that are easy to overlook:•Salary and overhead of user staff and management involved in the implementation•Disruption of work during implementation process•Salary of users during training and initial usage

OPERATION AND MAINTENANCECosts easily assigned to a project:•Salary and overhead for IS staff•Software license fees (if any)•Deprecitation of hardwareCosts that are easy to overlook:•Salary and overhead of user staff and management involved with system maintenance activities

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Figure 11.7Estimated benefit and cost streams

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Figure 11.8Possible boundary between user and IS departments

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Figure 11.9Why is it hard to develop the right system?

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Figure 11.10Gantt chart

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Table 11.7Common Problems Encountered by Analysts Interviewing Users

MISSING VIEWPOINTSTypical cause:•Users unwilling or unable to participate•Stakeholders who are not invited to participatePreventive action:•Make involvement of key users a condition for doing the project•Include all groups affected by the system

SUPERFICIAL INFORMATIONTypical cause: •Lack of preparation by the analyst•User’s assumption that only minor changes are possiblePreventive action:•Learn about the business setting, prepare before the interview•Don’t just ask for the user’s wish list; understand the reason for the user’s problem rather than just the suggested solution

DISTORTED INFORMATIONTypical cause:•User responses based on user aims other than the system, such as political position in the organization•Analyst misunderstanding or biasing the user’s responsePreventive action:•Obtain multiple viewpoints to confirm data and conclusions•Be sure users know the purpose of the interview•Learn about the business setting•Prepare before the interview