Chapter 2
Personal Productivity
The Strategic
Management of
Information
Systems
Transaction Processing
System
Input Output Process
Information
Communication
Systems Development
Changes in the Marketplace
? The quality imperative
? Consumer computing
? Deregulation of some major industries
? Crossing industry boundaries
? Traditional customers are,leaving”
? Crossing national boundaries
? Production is becoming global
? New product and service development cycles are
shortening
Two Concepts of the Corporation,
SBU or Core Competence
S BU Co re Co m p e ten c e
Ba sis fo r c o m p e ti ti o n Co m p e ti ti v e n e ss o f
to d a y 抯 p ro d u c ts
In terfirm c o m p e ti ti o n to
b u il d c o m p e ten c ies
Co rp o ra te stru c tu re P o rtfo li o o f b u sin e ss e s
re late d in p ro d u c t-ma rk e t
term s
P o rtfo li o o f c o m p e ten c ies,
c o re p ro d u c ts,a n d
b u sin e ss e s
S tatu s o f th e b u sin e ss u n it Au to n o m y is sa c ro sa n c t;
th e S BU, o wn s, a ll
re so u rc e s o th e r th a n c a sh
S BU i s a p o ten ti a l
re se rv o ir o f c o u r
c o m p e ten c ies
Re so u rc e a ll o c a ti o n Disc re te b u sin e ss e s a re
th e u n it o f a n a ly sis,
c a p it a l is allo c a ted
b u sin e ss b y b u sin e ss
Bu sin e ss e s a n d
c o m p e ten c ies a re th e u n it
o f a n a ly sis ; to p
m a n a g e m e n t a ll o c a tes
c a p it a l a n d tale n t
Va lu e a d d e d o f to p
m a n a g e m e n t
Op ti m izin g c o rp o ra te
tretu rn s th ro u g h c a p it a l
a ll o c a ti o n trad e -o ffs
a m o n g b u sin e ss e s
En u n c iatin g stra teg ic
a rc h it e c tu re a n d b u il d in g
c o m p e ten c ies to se c u re
th e fu tu re
Prototyping
? User requirements
? Input,output,and transactions
? Databases
? Controls
? Technology
? Applications
Systems Maintenance
“Phase”
? Systems Plan Report
? Systems Analysis Report
? General Systems Design Report
? Systems Evaluation and Selection Report
? Detailed Systems Design Report
? Systems Implementation Report
Personal Communications Networks
? Permit person-to-person rather than location-to-location,
Each person will have his or her own personal phone
number associated with a lightweight telephone that he or
she carries around,People will not only transmit telephone
conversations but also computer-based information,voice
mail,electronic messaging,call screening,and other
personal from anywhere,They will unlock levels of
freedom we don’t yet know,and they will be important for
special events,such as political conventions and sporting
events,as well as for emergencies,such as those caused by
natural disasters,
PDM
?Productivity
?Differentiation
?Management
Procedure-Based Vs,Goal-Based
Information Activities
Procedure-Based Activities,
? Tend to consist of high volumes of transaction in which each has
relatively low cost or value,
? Are based on well-defined procedures (or algorithms) where the
outputs are well-defined too,
? Are based on the handling of data,
Goal-Based Activities
? Tend to handle fewer transactions of higher value or cost,
? Are based on ill-defined processes (or heuristics) and the outputs are
less defined as well,
? Tend to focus on defining the problems and the end results or goals
with effectiveness stressed in achieving them,
? Are based on the handling of concepts,
OSI’s Seven Layers
? The Physical Layer
? The Data Link Layer
? The Network Layer
? The Transport Layer
? The Session Layer
? The Presentation Layer
? The Application Layer
Network Architecture
? A network architecture is not a diagram or a
set of diagrams,nor is it one utopian
solution for all network problems,It is a set
of policies,principles,and guidelines that
will lead to more widespread connectivity,
Three Components of the
Marketing Model
? A set of technologies that represent products,
developed by the systems department in an
organization
? A set of users of the technology who we can view
as customers for these products
? A delivery mechanism for developing,delivering,
and installing these systems that is analogous to
marketing activities
Peter Keen’s Projections
? Every large firm in every industry will have from 25
percent to 80 percent of its cash flow processed on-line
? Electronic data interchange (EDI) will be the norm
? Point-of-sale and electronic payments will be core
services
? Image technology will be an operational necessity
? Work will be distributed and reorganization will be
commonplace
? Work will increasingly be location-independent
? Electronic business partnerships will be standard
? Reorganizations will be frequent,not exceptional
Goal of Linkage
Analysis Planning
Examining the links that organizations have with one
another with the goal of creating a strategy for
utilizing electronic channels
? Understand,waves of innovation”
? Exploit experience curves
? Define power relationships
? map out your,extended enterprise”
? Plan your electronic channels
Systems Development Life Cycle
? Systems Planning
? Systems Analysis
? General Systems Design
? Systems Evaluation and Selection
? Detailed Systems Design
? Systems Implementation
Main Purpose of Each of the Three Groups in Mead’s
Current Information Resources Organization
? Information Resources Planning and Control Department - the
corporate perspective for information systems planning to ensure that
Mead’s information resources plans meshed with business plans,and
acted as planning coordinator to help various groups and divisions
coordinate their plans with corporate and information resources plans,
? Information Services Department - computer operations,development
of corporate-wide systems,provided technical services,and furnished
all the telecommunications services to the company
? Decision Support Applications (DSA) Department - all end user
computing support for the company
Murray’s Eight Phases to Distributed Systems
? Phase 1,The first phase is characterized by host-based,real-time query and update,
This phase is traditional on-line information system processing,where dumb terminals
access host-based applications to view and update data
? Phase 2,The second phase provides additional query capabilities through file transfers
to PCs,
? Phase 3,The third phase adds batch updating form PC data,This phase reverses the
philosophy of Phase 2 by making the PC database the master,
? Phase 4,The forth phase enables real-time query and update from either host or PC,
This phase extends the capabilities of the PCs by allowing them to update the host on-
line,
? Phase 5,The fifth phase introduces homogeneous cooperative processing without two-
phase commit,that is,like databases run on the same hardware and system software
platforms,This phase adds true distributed databases,across similar or identical
platforms,
? Phase 6,The sixth phase moves to heterogeneous cooperative processing without two-
phase commit,that is,databases run on a mix of platforms,This phase extends the
previous one by permitting distributed databases across mixed platforms,
? Phase 7,This seventh phase adds the all-important two-phase commit capability (to
homogeneous databases),going a system a true distributed database,
? Phase 8,This phase extends Phase 7 to heterogeneous databases,
Porter’s Five Competitive
Forces Model
? The threat of new entrants into one’s
industry
? The bargaining power of customers and
buyer
? The bargaining power of suppliers
? Substitute products or service
? Rivalry among competitor
Changes Occurring in Traditional Environments
? Many organizations are emphasizing teams to
accomplish major tasks and projects,
? Information workers are increasingly mobile,
? Organizations are examining what they should do
internally,and what should be done by some other
organization,
? Corporations are shifting their emphasis from
financial capital to human capital,
? New forms of self-managing groups are appearing,
? A coming labor shortage will result in more jobs for
women,part-time older people,and the poor and
disadvantaged,
According to Naisbitt and Aburdene
Federal Express Approaches to
Competing on Quality
? The program started at the top of the corporation
? They track actual failures rather than percentages
of success
? Their measures are from a customer perspective
? Everyone’s compensation is based on quality
improvement
? Solving root causes of failures
Information Engineering
Methodology (IEM)
?Systems Planning
?Systems Analysis
?Systems Design
?Systems Construction and
Implementation
Systems Departments Five Roles
in Business Reengineering
? Systems directors will be influences
? To participate on multidisciplinary teams,
which will be the change agents
? Build more flexible systems faster
? Introduce process-supporting technologies
? Be the custodian of the firm’s technical
architecture
According to the Index Foundation
What Reenginering Principles does
Michael Hammer Recommend?
? Organize around outcomes,not tasks
? People who use the output should perform the process
? Include information processing in the,real” work that
produces the information
? Treat geographically dispersed resources as if they
were centralized
? Link parallel activities rather than integrate them
? Let,doers” be self managing
? Capture information once and as its source
Elements of a Good Analysis
? Financial/Strategic Analysis
? Implementation/Methodology
? Measurable/Expected Results
? Future Growth/Continual Development
? HR Implications/People
? Core Competencies/Critical Service Factor
? Target Market Segment
Two Guiding Frameworks
for Distributed Systems
? An Organizational Framework -
The top three levels,
corporate,regional,and site
The bottom three levels,
department,work group,and individual
? A Technical Framework - Migration of computer
power to end users will be the driving force for
network-based information systems,Four
components,processors,networks,services,and
standards,
Four Forces Causing Management to Seriously
Consider Reengineering How Their Business Works
? The pressures of the 1990’s are forcing companies to focus on new
competitive strategies - quality,cycle time,customer service,and
niche markets,
? Enough failures in the 1980’s in using IT to gain competitive
advantage to force management to rethink their strategies for
achieving this goal,
? Companies are being forced to cut operating expenses so
significantly that traditional methods no longer work,
? The cost/performance of computer hardware and
telecommunications has dropped so dramatically that IT has
become practical for a far wider variety of uses than a few years
ago,
Four Types of Documentation
?Systems Documentation
?Software Documentation
?Operations Documentation
?User Documentation
Increased Pressures
on Information Technology
? Globalization/new competitors
– Pressure on IT to focus even more strongly on
businesses that are revenue-generating
? Faster business cycles
– Pressure on IT to focus on the increasing need to
support revenues and decreasing fixed/semi-fixed
costs
? Outsource
– non-revenue-generating functions
? Rapidly Changing Markets
– reinforce the need for flexibility in staff/operations
and shorter product life-cycles and
responsiveness,
Minimization
? Economies of scope
– Want one vendor to manage multiple functions
? Economies of Scale
– Leverage expertise and methodologies
– Reduce need to invest in expensive state-of-the-
art technologies
– Take process-oriented approach
? Management time devoted to one vendor
– Leverage Expertise
– Use non-revenue-generating areas to
provide multiple methodologies and functions
– Investment in expensive technologies
– Emphasize process-oriented approach