ch10_summer - Gonzaga University

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PART IV:
Chapter Topics
Chapter 10: Business Process & Information Systems
Development
• Two closely related and overlapping themes are
examined
Chapter 11: Information Systems Management
• Goal of the chapter is to give an appreciation for the
responsibilities of IS management and to be an effective
consumer of IS services
Chapter 12: Information Security Management
• Provides an overview of the major components of
information systems security
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Fox Lake
Chapter 10
• Examines how Fox Lake could define new
business processes and an information system to
support those processes
Chapter 11
• Investigates what Fox Lake is and is not doing
with regard to management of IS resources
Chapter 12
• Discusses why Fox Lake’s information systems
are particularly vulnerable to computer misuse
and crime
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Chapter 10
Business Process and
Information Systems
Jason C. H. Chen, Ph.D.
Professor of MIS
School of Business Administration
Gonzaga University
Spokane, WA 99258
[email protected]
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“You’re Not Going to Take Your Vera
Wang Gown into a Porta Potty.”
• Bathrooms not cleaned on busy Saturdays or
repaired on weekends
• Plumbing not designed for large crowds
• Didn’t think through consequences of wedding
events business.
 Didn’t know how wedding business would impact
everything else.
• Business analyst, Laura, hired to help
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Study Questions
Q1: Why do organizations need to manage business processes?
Q2: What are the stages of Business Process Management (BPM)?
Q3: How can BPMN process diagrams help identify and solve
process problems?
Q4: Which comes first, business processes or information systems?
Q5: What are systems development activities?
Q6: Why are business processes and systems development difficult
and risky?
Q7: What are the keys for successful process and systems
development projects?
Q8: 2022?
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Video
• The Golden Rules for Managers 119 Incredible
Lesson for Leadership Success (2:09)
• http://www.youtube.com/watch?v=pai00rCJSJU&
feature=related
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What are Business Process and Business
Process Management?
• Business process: A set of logically related tasks
performed to achieved a defined business outcome
• Business process management (BPM) is a
management approach focused on aligning all
aspects of an organization with the wants and needs
of clients. It is a holistic management approach[1]
that promotes business effectiveness and efficiency
while striving for innovation, flexibility, and
integration with technology.
http://en.wikipedia.org/wiki/Business_process_management
Dr. Chen,
Management
Information
Systems
Dr. Chen,
The Trends
of the Information
Systems Technology
7
TM -7
BUSINESS VALUE & FOCUS –
IS Perspective
IS/E-BUSINESS
•SCM
•CRM
•BPR
•ERP
Customer
centric
Who are the customers?
Where are the customers?
Their purchasing habits
Demands
Products/
Services
Value
What they need/want?
How many they need/want?
When they need/want?
How to reach them?
Business Models & Strategies
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1:
Why Do Organizations Need to
Manage Business Processes?
• Reasons for change
Improve process quality
Change in technology
Change in business fundamentals
–
–
–
–
–
–
–
Market
Product lines
Supply chain
Company policy
Company organization
Internationalization
Business environment
Dr. Chen, Management Information Systems
My teaching philosophy:
Learning to Learn and
Learning to Change
(e.g., Creating Web Pages)
9
Steps in Processing an Order
Fig 10-1: Steps in Processing an Order
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2: What Are the Stages of Business Process
Management (BPM)?
• Business Process Management (BPM)
 Systematic process of creating, assessing, altering business
processes (and is an iteration process).
• Four stages of BPM
1. Create model of business process components


Users review and adjust model
“As-is model” documents current process; it is changed to solve
process problems
2. Create system components

Uses five elements of IS (hardware, software, data, procedures,
people)
3. Implement business process
4. Create policy for ongoing assessment of process
effectiveness

Adjust and repeat cycles
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Stages in the BPM Cycle
[2]
[1]
[3]
[4] policy creation
and assessment
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Fig 10-2: Stages in the BPM Cycle
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Q/A
T/F: Business Process Management (BPM) is a
one-time process for systematically creating,
assessing, and altering business processes.
FALSE
Answer: ______
In business process management, once the as-is model
is created, the team must ________.
A) obtain feedback about implementation
B) assess the results of the changes
C) create system components
D) implement changes in the organization
Answer: ________
C
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Scope of Business Process Management
Fig 10-3: Scope of Business Process Management
BPM can apply only to commercial, profit-making
organizations but also nonprofit and government organizations
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Q3: How Can BPMN Process Diagrams
Help Identify and Solve Process Problems?
• Critical for a team to agree on both what is and
what ought to be.
• Must have some notation for documenting
processes and one common standard for creating
process documentation.
• Dozens of definitions are used by authors, industry
analysts, and software products.
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Need for Standard for Business Processing
Notation
• These differences and inconsistencies can be
problematic when two different organizations with
two different sets of definitions must work
together.
• Object Management Group (OMG) created a
standard set of terms and graphical notations for
documenting business processes.
• That standard, called Business Process Modeling
Notation (BPMN), is documented at
www.bpmn.org.
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Fig 10-4:
Business
Process
Management
Notation
(BPMN)
Symbols
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Documenting
the As-Is
Business
Order
Process:
Existing
Ordering
Process
Each role in
the business
process is
given its
own swim
lane.
Fig 10-5:
Existing
Ordering
Process
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Fig 10-6:
Check
Customer
Credit
Process
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BPMN: Business Process Management
Notation
_________
Q/A
T/F: In a BPMN process diagram,
the swim-lane layout is used to
simplify process diagrams and to
draw attention to interactions among
components of the diagram.
Answer: ________
TRUE
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Using Process Diagrams to Identify
Process Problems
• Process problems
1. Operations Manager allocates inventory to
orders as processed
2. Credit Manager allocates customer credit for
orders in process.
 Allocations correct, if order accepted
 If rejected, allocations not freed, inventory still
allocated and credit extended for orders not
processed
 Possible fix: Define an independent process for
Reject Order (UYK#3 p.383)
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How Can Business Processes Be
Improved?
resources
1. Add more ________
• Adds costs unless efficiencies of scale
process structure
2. Change _______
• Reduce work and costs
• Increase costs and increase effectiveness to
offset
Do both
3. _________
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Fig 10-7:
Revised
Order
Process
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Fig 10-8: Fox Lake Wedding Planning and Facilities Maintenance Processes
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Q4:
Which Comes First, Business Processes or Information Systems?
Fig 10-9: Fox Lake Processes Showing IS Components
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Fig 10-10: Many-to-Many Relationship of Business Processes and Information Systems
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Build Business Processes First
[2]
next stage
[1]
[3]
[4] policy
creation and
assessment
Starting from processes and working toward Information Systems (IS) is likely to work
well for the business process under consideration, but will cause problems later, for
other processes that use the same IS.
Fig 10-11: BPM and Systems Development
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Build Information System First
This development process makes business processes a poor step-child of the IS
development process as BP can include many activities that are not part of the IS.
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Fig 10-12: Classic Five-Step Systems Development Life Cycle
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Why systems development is needed?
• While you may be able to purchase an off-the-shelf
software program, you won’t be able to do that with
information systems. Here are some of the reasons
why:
 You must construct or adapt procedures to fit the business and the
people who will be using the system. You can’t buy procedures.
 People must be trained to use the information system effectively.
You can’t buy that.
 Users must take ownership of their system. That’s the single most
important criterion for the success of an information system.
• Information system maintenance involves two things:
 Fixing a system to make it do what it should have done in the first
place, or
 Adapting it to changing requirements.
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Systems Development Is Not Just for
Techies
• Establishing the system’s goals, setting up the
project, and determining requirements require
business knowledge and management skill.
• Tasks such as building computer networks and
writing computer programs require technical
skills.
• Developing the other components requires
nontechnical, human relations skills.
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Nontechnical, Human Relations Skills
Required
• Creating data models requires the ability to interview
users and understand their view of the business
activities.
• Designing procedures, especially those involving group
action, requires business knowledge and an
understanding of group dynamics.
• Developing job descriptions, staffing, and training all
require human resource and related expertise.
• Coordinated teamwork of both specialists and
nonspecialists with business knowledge.
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How Do Businesses Use the SDLC Process?
1. Systems definition
 Management’s statement of objective and goals for new
system
2. Requirements analysis
 Identify features and functions
3. Component design (hardware, software, network)
 Based on approved user requirements
4. Implementation
 Purchase, build, test, and convert to new system
5. System maintenance (fix or enhance)
 Repair, add new features, maintain
See http://www.learn.geekinterview.com/it/sdlc/sdlc-methodologysteps.html
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Another Factor: Off-the-Shelf Software
• If starting with business processes first
– Likely to choose package for processes being
developed, but not for later processes
• If starting with information systems first
– Likely to choose package that works for all
users, but, business processes will get short
shrift.
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And the Answer Is . . .
• In theory:
 Better to start with ___________________
business processes
 More likely to result in processes and systems that
are aligned with the organization’s strategy and
direction
• In practice:
 Organizations take both approaches
• Off-the-shelf software:
Start with business processes and select “off-theshelf” application that works for those processes
Why?
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Q/A
Which of the following is true for the relationship between
business processes and information systems?
A) Developing information systems before business processes
ensures that all activities are considered in the development
process.
B) Information systems incorporate all business process activities,
and hence should be developed before business processes.
C) Starting from processes and working toward information
systems is the best option to anticipate future demands and new
business processes.
D) Starting with processes and working toward systems is more
likely to result in processes and systems that are aligned with the
organization's strategy and direction.
D
Answer: ______
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SDLC
• What does SDLC stand for?
Systems Development Life Cycle
• List the phases of SDLC
Analysis
Design
Implementation
Maintenance
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4: What Are Systems Development Activities?
1. Systems definition
 Management’s statement of objective and goals for new
system
Analysis
2. Requirements analysis
 Identify features and functions
3. Component design (hardware, software, network)
 Based on approved user requirements
4. Implementation
 Purchase, build, test, and convert to new system
5. System maintenance (fix or enhance)
 Repair, add new features, maintain
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4: What Are Systems Development Activities?
[1]
[2]
[3a]
[3b]
[5]
(Feasibility Study)
What is it and Why
it is important?
[4]
Fig 10-13: BPM Provides Requirements for Systems Development
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Define System Goals and Scope
Fig 10-14: SDLC: System Definition Phase
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How Is System Definition Accomplished?
1. (b.) Define scope for new system
 Defined by customers, users involved, business
processes impacted, physical location, functional
area
 Clear definition of scope simplifies
 Requirements determination
 Coordination and other work
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Assess Feasibility
Dimensions of feasibility
Cost feasibility
• ______
 Approximated, “back-of-the-envelope” analysis
 Purpose: eliminate infeasible ideas early
 Consider cost of previous projects, operational and labor costs
Schedule feasibility
• __________
 Ball park estimate
Technical feasibility
• __________
 Is it technically likely to meet needs?
• _____________
Organizationalfeasibility
 Fit with customs, culture, charter, legal requirements of
organization
Legal and Contractual feasibility
 ___________________
 Is the proposed system legally?
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Systems Definition/Investigation (Feasibility Study)
Economic
Feasibility
Can we afford it?
Technical
Feasibility
Does the IT
capability exist?
Legal and
Contractual Feasibility
Is the proposed
system legally?
Dr. Chen, Management Information Systems
What are new from
the last slide?
Operational
Feasibility
Will it be accepted?
Schedule
Feasibility
Will it be completed by
the deadline?
Organizational
Feasibility
(Is it a good fit –
objective of the organization
42
Form a Project Team
• Typical three personnel on a development team are:
 Manager (or mangers for larger projects)
 Specialist:
 System analysts
 Programmers
 Software testers
 or, other functional specialist such as accounting,
finance, and marketing
 Users:
 Users must be involved in most of SDLC phases
• Depending on nature of project, team may also include
hardware and communications specialists, database designers
and administrators, and other IT specialists.
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Form a Project Team
• Team composition changes over time.
• During requirements definition, the team will be
heavy with systems analysts.
• During design and implementation, it will be
heavy with programmers, testers, and database
designers.
• During integrated testing and conversion, the
team will be augmented with testers and
business users.
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Business and Systems Analysts
• Business Analysts
 Someone who are well versed in Porter’s models,
organizational strategy, and system alignment theory
and who also understand the proper role for
technology.
• IS professionals
 who understand both business and technology.
 They are active throughout the systems development
process and play a key role in moving the project
through the systems development process.
 Systems analysts integrate the work of the
programmers, testers, and users.
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Fig 10-15: Focus of Personnel Involved in BPM and Systems Development
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Phase Two: Requirements Analysis



System Analysts are IS
professionals who understand
both business and
technology.
The most important phase in
the SDLC process is to
determine system
requirements. If the
requirements are wrong, the
system will be wrong. Seven
activities occur in this phase
as the diagram shows.
Users are a critical part of
this phase. They must
approve the requirements
before moving to the next
phase.
Dr. Chen, Management Information Systems
Fig 10-16 SDLC: Requirements Analysis Phase
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Phase Three: Component Design:
Design Tasks Pertain to Each of the Five IS Components

All five components require attention in the design phase:
 Hardware—Determine the specifications and evaluate alternatives against
the requirements. Purchase it, lease it, or lease time from hosting service
 Programs—Decide whether to use off-the-shelf software, off-the-shelf
with alterations, or custom-developed software.



Database—Convert the data
model to a database design.
Procedures—Design procedures
for users, operations personnel,
and for normal, backup, and
failure recovery tasks.
People—Design job
descriptions for users and
operations personnel. You may
have to add new jobs or alter
existing jobs.
Fig 10-17: SDLC: Component Design Phase
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Q/A
T/F: If a project involves off-the-shelf
programs, then little database design
needs to be done.
TRUE
Answer: ________
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Phase Four: Implementation

Focuses on
implementing the
system and includes
the tasks of
 building each of
the five system
components
 testing the system
and
 converting users to
the new system.
Fig 10-18: SDLC: Implementation Phase
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System Conversion Approaches
1.
Pilot



2.
Phased


3.
System is installed in phases or modules.
Each piece is installed and tested.
Parallel


4.
Implement entire system in limited portion of business
MRV uses system for selected customers.
Advantage: limits exposure to business if system fails
Complete new and old systems run simultaneously
Very safe, but expensive
Plunge (or direct)


High risk if new system fails, no old system to fall back on
Only used if new system is not vital to company operation
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Installation Conversion Methods: 4 Ps
Cut-over time
Old System
Parallel
New System
Old System
Old System
Old System
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New System
New System
New System
Pilot
Phased
Plunge/
Direct
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Design and Implementation for the Five Components
Fig 10-19: Design and Implementation for the Five Components
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SDLC: System Maintenance Phase (5)
Fig 10-20:
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Causes of Information Systems Failures
•35+ years of research on causes of information
systems failures
involvement.
1. Lack of user __________
2. Unclear, incomplete, and inconsistent
___________
requirements.
3. Changing requirements and specifications
ignore
•Many businesses __________
research findings
Dr. Chen, Management Information Systems
Q6: Why Are Business Processes and
Systems Development Difficult & Risky?
• SDLC ________
Waterfall
 Sequence of nonrepeated phases
 It rarely works smoothly, causing development team to go back
and forth, raising costs and delaying project
• Requirements documentation difficulty
 Business requirements sometimes change making documented
requirements incomplete or obsolete
 “Analysis paralysis”—projects spend so much time on
documentation that it hampers progress
• Scheduling and budgeting difficulties
 Time and cost estimates for large project are usually way off
 People who make initial estimates know little about how long it
will take or cost
10-56
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Q6. Why Are Business Processes and
Systems Development Difficult & Risky? (cont.)
• Changing Technology
 While the project is underway, technology continues to
change.
• Diseconomies of Scale
 As development teams become larger, the average
contribution per worker decreases.
 Brooks’ Law:
Adding more people to a late project makes the
project later.
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1a
1b
2
3
4
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Fig 10-21: Major Challenges to System Development
58
Q7: What Are the Keys for Successful
Process and Systems Development Projects?
• Create a work-breakdown structure (WBS)
– Break project into smaller tasks until each task is small
enough to estimate and manage
– Every task results in deliverables
•
•
•
•
Estimate time and costs
Create a project plan
Adjust the plan via trade-offs
Manage development challenges
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Fig 10-22:
Create a
WorkBreakdown
Structure
(WBS)
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Gantt Chart of the WBS for the
Definition Phase of a Project
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Create a Project Plan: Gantt Chart with Assigned
Resources & Critical Path
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Project Triangle
(Project Management Trade-offs)
Cost
Time
The center of
project triangle is
QUALITY
Scope (Requirements)
The objective of the PM is to define project’s scope realistically and ultimately
deliver quality of product/service on time, on budget and within scope.
Dr. Chen, Management Information Systems
Trade-Offs in Requirements, Cost, and Time?
• Balancing development drivers
1. Requirements (scope)
2. Cost
3. Time
• Trade-offs
1.
2.
3.
4.
Elaborate requirements increase costs and time
Time can be reduced to a point w/o adding costs
Increasing time may reduce or increase costs
If schedule needs to be shortened, two alternatives
available: reduce requirements or add labor
5. Adding more people creates diseconomies of scale
(Brooks’ Law)
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Adjust Plan via Trade-offs:
Trade-offs Among Requirements, Schedule, and Cost?
Insert Figure 10-12 here (Figure CE19-2 in Experiencing MIS 2/e)
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Manage Development Challenges
Critical Factors
1.
2.
3.
4.
5.
Coordination
Diseconomies of scale
Configuration control
Unexpected events
Team morale
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Q8: 2022?
1. Users more knowledgeable and demanding
2. More agile systems using SOA and other
techniques
3. More Cloud-based development
4. Emergence of new software vendor business
models
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• End of Chapter 10
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