Chapter 13-15

• ·        Angostura Builds a Mobile Sales System

  – Angostura Limited, based in Latenville, Trinidad, is a leading rum producer and a major manufacturer of bitters for cocktails.
• ·        Building a new information system is one kind of planned organizational change. This involves much more than new hardware and software. It also includes changes in jobs, skills, management, and organization.
• ·        AUTOMATION – It is the most common form of IT-enabled organizational change. The first stage with the lowest risk and return which involves using technology to perform tasks that were previously done manually.
• ·        RATIONALIZATION – The next stage where processes are streamlined to improve efficiency, leading to a moderate increase in risk and return.
• ·        BUSINESS PROCESS REDESIGN – A more advanced stage that involves changing the way work is done, resulting in higher risk and return.
• ·        PARADIGM SHIFTS – The final and most transformative stage, characterized by the highest risk but also the highest potential return. It involves rethinking the nature of the business and the nature of the organization.
• ü  Rationalization of procedures – A deeper form of organizational change—one that follows quickly from early automation
• ü  Total quality management (TQM) – makes achieving quality an end in itself and the responsibility of all people and functions within an organization.

  W. Edwards Deming and Joseph Juran
• ü  Six sigma – a specific measure of quality, representing 3.4 defects per million opportunities.
• BUSINESS PROCESS REDESIGN

  – reorganizes workflows, combining steps to cut waste and eliminate repetitive, paper-intensive tasks.

       Ford Motor Company’s invoiceless processing
• Business process management (BPM) – provides a variety of tools and methodologies to analyze existing processes, design new processes, and optimize those processes
• 1.      IDENTIFY PROCESSES FOR CHANGE – One of the most important strategic decisions that a firm can make is not deciding how to use computers to improve business processes but understanding what business processes need improvement
• 1.      ANALYZE EXISTING PROCESSES – Existing business processes should be modeled and documented, noting inputs, outputs, resources, and the sequence of activities.
• 1.      DESIGN THE NEW PROCESS – Once the existing process is mapped and measured in terms of time and cost, the process design team will try to improve the process by designing a new one.
• 1.      IMPLEMENT THE NEW PROCESS – Once the new process has been thoroughly modeled and analyzed, it must be translated into a new set of procedures and work rules.
• CONTINUOUS MEASUREMENT – Once a process has been implemented and optimized, it needs to be continually measured.
• For example, American National Insurance Company, which offers life insurance, medical insurance, property casualty insurance, and investment services, used Pega BPM workflow software to streamline customer service processes across four business groups. The software built rules to guide customer service representatives through a single view of a customer’s information that was maintained in multiple systems
• ·        Systems development – The activities that go into producing an information system solution to an organizational problem or opportunity. This is a structured kind of problem solved with distinct activities. It consists of defining the problem, identifying its causes, specifying the solution, and identifying the information requirements that must be met by a system solution.
• Ø  SYSTEMS ANALYSIS – the analysis of a problem that a firm tries to solve with an information system. It consists of defining the problem, identifying its causes, specifying the solution, and identifying the information requirements that must be met by a system solution.
• ·        SYSTEMS ANALYST – The analyst creates a roadmap of the existing organization and systems, identifies the primary data owners and users, and details the problems of existing systems.
• ·        SOLUTION – Often, the solution involves building a new information system or improving an existing one.
• ·        FEASIBILITY STUDY – This study determines whether the proposed solution is feasible from financial, technical, and organizational standpoints.
• ·        ALTERNATIVE SOLUTIONS – The systems analysis process typically identifies several alternative solutions. A written systems proposal report describes the costs, benefits, advantages, and disadvantages of each alternative.
• ü  Most challenging task of the systems analyst – define the specific information requirements that must be met by the chosen system solution
• ·        Information requirements – involve identifying who needs what information, where, when, and how
•      Requirements analysis – carefully defines the objectives of the new or modified system and develops a detailed description of the functions that the new system must perform.
•      Faulty requirements analysis – a leading cause of systems failure and high systems development costs
• ·        Systems analysis – describes what a system should do to meet information requirements
• ·        Systems design – shows how the system will fulfill this objective and consists of all the specifications that give the system its form and structure.
• ·        Systems design – shows how the system will fulfill this objective and consists of all the specifications that give the system its form and structure.
• ü  Systems designer – details the system specifications that will deliver the functions identified during systems analysis
• ·        Programming – During the programming stage, system specifications that were prepared during the design stage are translated into software program code.
• ·        Testing – Exhaustive and thorough testing must be conducted to ascertain whether the system produces the right results.
• a.      Unit testing / program testing – consists of testing each program separately in the system.
• a.      System testing – tests the functioning of the information system. It tries to determine whether discrete modules will function together as planned and whether discrepancies exist between the way the system works and the way it was conceived.
• a.      Acceptance testing – provides the final certification that the system is ready to be used in a production setting.
• Test plan – includes all the preparations for the series of tests we have just described.
• ·        Conversion

  -        The process of changing from the old system to the new system.
• a.      Parallel Strategy – Both old and new systems run at the same time until everyone is sure the new one works correctly. It’s safe but can be expensive.
• a.      Direct Cutover Strategy – The old system is completely replaced by the new one on a specific day.