Chapter 3

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Chapter 3 Information Systems Development and ManagementObjectivesAfter completing this chapter, you will be able to Understand howl organizations develop their information systems. Identify the key participants in the system development process and understand their roles. Explain the phases in the system development life cycle. Identify the core activities in the information systems development process. Understand other system-building alternatives. Understand ethical and social issues related to information systems Understand information security and control

ContentsOverview of System DevelopmentSystem Development Information System Planning Establishing Objectives and information requirements for Systems Development Measuring Information System Performance Project Management

Participants in Information Systems Development System Development Life CyclePhases in System Development Cycle Planning Phase Analysis Phase Design Phase Implementation Phase Operation and Maintenance Phase CSAE Tools

Alternative System Development ApproachesPrototyping Application Software Package End-User Development Developing Systems with Teams: JAD and RAD Outsourcing Summary

Information System ManagementUnderstanding Ethical and Social Issues Related to Systems Information Security Establishing a Framework for System Security and Control

3.1 Overview of System Development3.1.1 System DevelopmentA system is a set of components that interact to achieve a common goal. You use, observe, and interact with many systems during daily activities. You drive a highway system to reach a destination. You use a programmable thermostat to regulate your heating and cooling systems to save energy. Businesses also use many types of systems. A billing system allows a company to send invoices and receive payments from customers. An inventory system keeps track of the items in a warehouse. A manufacturing system produces the goods that customers order. Through a payroll system, employees receive paychecks. Very often, theses systems also are information systems. An information system is a collection of hardware, software, data, people, communications, and procedures that work together to produce quality information. The goal of an information system is to provide users with high-quality information so they can make effective decisions. An information system supports daily, short-term, and long-range activities of users. Some


examples of users include store clerks, sales representatives, accountants, supervisors, managers, executives, and customers. The kinds and types of information that users need often change over time. As a system user in a business, you someday may participate in the modification of an existing system or the development of a new system. Thus, it is important that you understand the system development in business. Systems development is the activity of creating a new business system or modifying an existing business system. It refers to all aspects of the process -from identifying problems to be solved or opportunities to be exploited to the implementation and refinement of the chosen solution. Whatever its scope and objectives, a new information system is an outgrowth of a process of organizational problem solving. A new information system is developed as a solution to some type of problem or set of problems the organization perceives it is facing. The problem may be one where managers and employees realize that the organization is not performing as well as expected, or it may come from the realization that the organization should take advantage of new opportunities to perform more successfully. When information requirements change, the information system must meet the new requirements. In some cases, the current information system is modified; in other cases, an entirely new information system is developed. Understanding information systems development is important to all professionals, not just those in the field of information systems. In today's organizations, managers and employees in all levels and functional areas work together and use business information systems. As a result, users of all types are helping with systems development and, in many cases, leading the way. At some point in your career, you will likely be involved in a systems development project -- as a user, as a manager of a business area or project team, as a member of the information systems department, maybe even as a CIO (Chief Information Officer) or CEO. Understanding and being able to apply systems development life cycle concepts, tools and techniques will help ensure the success of the development projects on which you participate. One important thing to know about information systems development is that an information system is a sociotechnical entity, an arrangement of both technical and social elements. The development of a new information system not only involves hardware, software, data, programmers and communications, but also includes changes in jobs, knowledge, skills, management, policies, processes, and organization. Often new systems mean new ways of doing business and working together. Building a new information system will affect the organization as a whole and change the decision-making process. When we develop a new information system, we are actually changing the organization and business processes. System builders must understand how a system will affect the organization as a whole, focusing particularly on organizational conflict and changes in the locus of decision making. Builders must also consider how the nature of work groups will change under the new system. Systems can be technical successes but organizational failures because of a failure in the social and political process of building the system. Therefore, information systems development has become an essential component of the organizational planning process.


Information Systems Planning

Because an organization's business strategic plan contains both organizational goals and a broad outline of steps required to reach them, the business strategic plan affects the type of system an organization needs. Deciding which new systems to build should be an essential component of the organizational planning process. Organizations need to develop an information systems plan that supports their overall business plan and in which strategic systems are incorporated into top-level planning. The information systems planning refers to the process of the translation of strategic and organizational goals into systems development plan and initiatives (Figure 3-1). For example, part of the information systems plan for a luxury car company might be to build a new product tracking system to meet the organizational goal of improving customer service. Proper information systems planning ensures that specific systems development objectives support organizational goals. One of the primary benefits of information systems planning is that it provides a long-range view of information technology use in the organization. The information systems plan provides guidance on how the information systems infrastructure of the organization should be developed over time. The plan serves as a road map indicating the direction and rationale of systems development. Another benefit of information systems planning is that it ensures better use of information systems resources, including funds, information systems personnel, and time for scheduling specific projects.

Organizations Business Strategic Plan

Information Systems Planning

Information Systems Plan

System Development Initiatives

Figure 3-1 The process of information systems planning


Figure 3-2 shows the steps of information systems planning. Overall objectives of information systems are usually distilled from the Strategic Plan relevant aspects of the organization's business strategic plan. Information systems projects can be identified either directly from the objectives determined in the first step or may be identified by Develop overall objectives others, such as managers within the various functional areas. Setting priorities and selecting projects typically requires the involvement and approval of senior management. Once specific projects have been selected within the overall context of a strategic plan for the Identify information system projects business and the systems area, an information systems plan can be developed. The plan contains a statement of organizational goals, identifies the project objectives, and specifies how information technology supports the attainment of the organizational goals. When Set priorities and select projects objectives are set, planners consider the resources necessary to complete the projects including equipment (computers, network servers, printers, and other equipment and devices), software, employees (systems analysts, programmers, users and others), expert Develop information systems plan advice (specialists and other consultants), and so on. The information systems plan lays out specific target dates and milestones that can be used later to monitor the plans progress in Analyze resource requirements terms of how many objectives were actually attained in the time frame specified in the plan. The plan also includes the key management decisions concerning hardware acquisition; structure of authority, data, and hardware; telecommunications; and required Set schedules and deadlines organizational change. Organizational changes are usually described, including management and employee training requirements; recruiting efforts; changes in business processes; and changes in authority, structure, or management practice. The manager's toolkit Develop information system in Figure 3-3 gives the guideline for developing an information planning document system plan. As par