Developing e-Business Solutions 10 Developing e-Business Solutions © 2002 McGraw-Hill Companies

Chapter Objectives Use the systems development process outlined in this chapter, and the model of IS components from Chapter 1 as problem-solving frameworks to help you propose information systems solutions to simple business problems. Describe and give examples to illustrate how you might use each of the steps of the information system development cycle to develop and implement an e-business system. © 2002 McGraw-Hill Companies

Chapter Objectives Explain how prototyping improves the process of systems development for end users and IS specialists. Identify the activities involved in the implementation of new information systems. Describe several evaluation factors that should be considered in evaluating the acquisition of hardware, software, and IS services. Identify several change management solutions for end user resistance to the implementation of new e-business applications. © 2002 McGraw-Hill Companies

Systems Approach to Problem Solving Design the Solution Define Problem Develop Alternative Solutions Select Implement Monitor and Evaluate Results The systems approach views a business process as a system that has 5 components: input, process, output, feedback and control. The systems approach to problem solving uses the systems orientation to conceptualize the nature of the problem. Under the systems orientation, all elements of a problem interact with one another. Consequently, the systems approach considers each "step" to influence and provide feedback on every other step: Define the Problem. A problem is a basic condition that is causing an undesirable result. An opportunity is a basic condition that presents the potential for desirable results. A key task at this stage is to separate symptoms -- signs that a problem exists -- from the actual problems themselves. Develop Alternative Solutions. It is almost always true that every problem or opportunity has more than one effective course of action. As a problem solver, you must resist the tendency to move to the most immediate solution that comes to mind. It is good management practice to generate several alternatives and choose among them on the basis of clearly defined evaluative criteria. Select the Solution. On the basis of evaluative criteria, it is possible to compare alternatives to each other. Selection is important because there must be firm commitment to the alternative before committing organizational resources to solving the problem. Design the Solution. The selected solution to an IS problem next requires designing how the solution will be created. Here it is a good idea to meet with business end users and technical staff to develop design specifications and an implementation plan. Implement the Solution. When ready, the solution must be implemented. It is a good idea to monitor implementation carefully so that an assessment of the solution, design, and the logistics of bringing it into action can all be evaluated objectively. Teaching Tips This slide corresponds to Figure 10.3 on pp. 345 and relates to the material discussed in the whole chapter. © 2002 McGraw-Hill Companies

Traditional Systems Development Life Cycle Systems Implementation Product: Operational System Systems Investigation Feasibility Study Systems Analysis Functional Requirements Systems Design System Specifications Systems Maintenance Improved System Understand the Business Problem or Opportunity Develop an Information System Solution Implement the Information The traditional information systems development cycle is based upon the stages in the systems approach to problem solving, where each step is interdependent on the previous step: Systems Investigation. This stage may begin with a formal information systems planning process to help sort out choices from many opportunities. Typically, due to the expense associated with information systems development this stage includes a cost/benefit analysis as part of a feasibility study. Systems Analysis. This stage includes an analysis of the information needs of end users, the organizational environment, and any system currently used to develop the functional requirements of a new system. Systems Design. This stage develops specifications for the hardware, software, people, network, and data resources of the system. The information products the system is expected to produce are also designated. Systems Implementation. Here the organization develops or acquires the hardware and software needed to implement the system design. Testing of the system and training of people to operate and use the system are also part of this stage. Finally, the organization converts to the new system. Systems Maintenance. In this stage, management uses a postimplementation review process to monitor, evaluate, and modify the system as needed. Teaching Tips This slide corresponds to Figure 10.3 and relates to the material presented in the whole chapter. © 2002 McGraw-Hill Companies

Prototyping Process Identify an End User's Information Requirements Use and Maintain the Accepted System Identify an End User's Information Requirements Develop Information System Prototypes Revise the Prototypes to Better Meet End User Requirements Prototyping Cycle Maintenance Prototyping is the rapid development and testing of working models, or prototypes, of new applications. Prototyping is an iterative, interactive process that combines steps of the traditional development cycle with the increased involvement of end users to provide feedback that improves the prototype and the final IS. Application development using prototyping proceeds through the following steps: Identify Requirements. Here end users identify their information needs and assess the feasibility of several alternative information system solutions. Develop Prototype. Here end users and/or systems analysts use application development packages to interactively design and test prototypes of information system components that meet end user information needs. Revise Prototype. During this stage, the information system prototypes are used, evaluated, and modified repeatedly until end users find them acceptable. Use and Maintain. The accepted system can be modified easily since most system documentation is stored on disk. Teaching Tips This slide corresponds to Figure 10.4 on pp. 346 and relates to the material on pp. 345-347. © 2002 McGraw-Hill Companies

Systems Investigation Organizational Feasibility Is it a good fit? Operational Will it be accepted? Economic Can we afford it? Technical Does the capability exist? Teaching Tip: Consider redisplaying slide 5 “Traditional Systems Development Life Cycle”, before beginning discussion of this lecture slide. As pointed out earlier, all application development methodologies share certain common activities. During the remainder of this lecture we will discuss these activities. We will begin by discussing systems investigation. The Investigation Phase begins the preliminary study of the proposed information system solution to meet the e-business needs. Its focus is to seek to answer the questions: What are our opportunities, what are our priorities, and can IS be used to address these needs? Because the process of application development can be costly both in time and resources, the system investigation phase begins with a Feasibility Study. The goal of feasibility studies is to evaluate alternative systems and to propose the most feasible and desirable systems. Feasibility is assessed across four major categories: Organizational Feasibility. This focuses on how well a proposed information system supports the objectives of the organization. Technical Feasibility. This ascertains whether reliable hardware and software capable of meeting the needs of the proposed system can be acquired or developed. Operational Feasibility. This refers to the willingness and ability of the management, employees, customers, suppliers, and others to operate, use, and support a proposed system. Economic Feasibility. This is concerned with whether the proposed IS benefits are greater than its costs. This area is particularly concerned with financial affordability -- whether the firm can pay to develop the system. A cost/benefit analysis is used to weigh the total costs a new system is likely to incur against the total anticipated benefits to be gained. This includes determining tangible costs (such as hardware and software purchases and employee salaries) and intangible costs such as effects on employee morale and disruptions in productivity during the installation of the new system. Benefits too can be either tangible (such as reduced inventory and carrying costs) or intangible (higher customer satisfaction). Teaching Tips This slide corresponds to Figure 10.7 on pp. 348 and relates to the material on pp. 347-349. © 2002 McGraw-Hill Companies

Systems Analysis Key Areas of Systems Analysis Organizational Functional Requirements Present System The goal of system analysis is to determine what the system should do. It is an in-depth study of end user information needs that produces functional requirements that are used for design. Systems Analysis involves three key areas: Organizational Analysis. An effective IS can only be designed with a full awareness of the organization it will serve. Systems analysis then begins with a thorough analysis of the organization, its management structure, its people, its business activities, the environmental systems it deals with, and its current information systems. Analysis of the Present System. If a system already exists, it is useful to study it to help assess how it can be improved or replaced by the proposed system. In particular, the analysis should identify how things are currently done (such as user interface methods) and determine how they should be done in the system being designed. Functional Requirements Analysis. Functional requirements specify the information systems capabilities required to meet the information needs of users. In particular, functional requirements analysis must specify: User Interface Requirements. What user input will be needed? The input/output needs of end users must be supported by the IS. Processing Requirements. Functional analysis must specify the processing requirements necessary to perform all the activities involved in converting input into output. The objective is to determine what must be done; not how it will be done. Storage Requirements. What data must be stored and retrieved? Organization, content, and size of databases and procedures for maintenance must be specified. Control Requirements. What control reports must be produced? What data input controls are needed? Issues of accuracy, validity, safety, security, and adaptability must be specified. Teaching Tips This slide corresponds to material on pp. 349-351. © 2002 McGraw-Hill Companies

Systems Design User Interface Design Data Design Process Design Systems design specifies how the system will accomplish the objectives of meeting the information needs of users as described by the systems analysis. Design activities produce system specifications satisfying the functional requirements identified earlier. Specifications are then used to develop or acquire the necessary components and skills to implement the system. The systems design concept focuses on three major products or deliverables: User Interface Design. This activity focuses on the interaction between end users and computer systems. In the e-business, designers concentrate on designing attractive and efficient forms for user input and output on intranet pages. Prototyping is often used at this stage to involve users in developing acceptable interfaces. Data Design. This activity focuses on the design of the structure of databases and files to be used by a proposed information system. Data design frequently produces a data dictionary, which catalogs detailed descriptions of the attributes of entities (objects, people, places, events) about which the IS needs to maintain information. The data dictionary also specifies the relationship entities have to each other, the specific data elements for each entity, and the integrity rules governing how each data element is specified and used in the IS. Process Design. This activity focuses on the design of software resources -- the programs and procedures needed by the proposed IS. System Specifications. Completion of the previous areas of system design culminate in a clear statement of system specifications for the User Interface, Database, Software, Hardware and Facilities, and Personnel components of the IS. Teaching Tips This slide corresponds to Figure 10.12 on pp. 352 and relates to the material on pp. 351-353. Screen, Form, Report and Dialog Design Data Element Structure Design Program and Procedure Design © 2002 McGraw-Hill Companies

End User Development Controls What controls are needed? Input What data is required? Processing What operations on the input Output What information is needed? Storage Will the application need to store data? The availability of end user development tools make it possible for end users to develop their own computer-based solutions. End user development results in faster application development and applications that are more likely to meet user requirements and needs. In user development, IS professionals play a consulting role, aiding or training the user in the use of application packages or prototyping tools. It is important to remember that end user development should focus on the fundamental activities of any information system. As the slide depicts the user developer should focus on the following: Output. What output needs to be produced? That is, what information should the application provide? What are the characteristics of that output, e.g. form? Input. What input needs to be supplied to the application? What data is available? What is its source? Processing. What operations or transformation processes will be required to convert the available inputs into the desired output? Storage. Will the output, or some intermediary form of data, need to be stored? If so, what files or databases will be used to store the data? Controls. What controls are needed to protect the data? Does access to the data need to be controlled? How should we protect against loss of data? Teaching Tips This slide corresponds to Figure 10.16 on pp. 355 and relates to the material on pp. 353-356. © 2002 McGraw-Hill Companies

The Implementation Process Conversion System Docu- mentation End User Training Development and Modification Acquisition Implementation Activities Testing The implementation process involves developing the information system into an operational system for end users. Key activities include: Acquisition of Hardware, Software, and Services. Some very large organizations purchase proprietary hardware and software solutions. An increasing number of companies can purchase off-the-shelf hardware and software from original equipment manufacturers or resellers. In the next slide we will cover this topic in more detail. Software Development or Modification. Some companies write their own software in-house. Even for those firms that buy software off-the-shelf, modification is often necessary (indeed, the flexibility to modify software is built in to most application programs). System Testing. Involves testing website or application performance. It may involve such activities as testing and debugging software and testing new hardware. End User Training. This is a vital activity. Provisions and resources for training end users on the new system must be identified and allocated. System Documentation. How to use and maintain the system must be provided in the form of manuals and, increasingly, online help. In addition, a detailed record of the system’s design is essential for future problem diagnostics or making changes. This effort is simplified through the use of CASE tools. Conversion. This involves the actual logistics of switching to the new system. The four methods are covered on a later slide. Teaching Tips This slide corresponds to Figure 10.20 on pp. 359 and relates to the material on pp. 359-367. © 2002 McGraw-Hill Companies

Evaluating Hardware and Software Hardware Evaluation Factors Performance Cost Reliability Compatibility Technology Ergonomics Connectivity Scalability Software Support Software Evaluation Factors Quality Efficiency Flexibility Security Connectivity Language Documentation Hardware In today’s e-business environment, acquisition of hardware, software, and IS services is an important part of e-application development. How should companies make such acquisition choices? What process should they use for selecting vendors? Larger businesses may require suppliers to present bids and proposals based on system specifications developed during the design phase. Many e-businesses formalize these requirements into a document called an RFP (request for proposal). The selection process may sometimes involve a live test demo of software or hardware functionality, or a benchmark test, which is used to evaluate system performance through simulation of typical processing tasks. In each case hardware and software evaluation factors are used to judge the suitability of the component. Teaching tip: Consider discussing the individual factors shown on the slide. When acquiring IS services, other evaluation factors need to be considered. These include: Past Performance. Referrals from past customers is essential. Business Position. Is the vendor financially strong, with good industry prospects? Service and Capabilities. What kind of services can they offer? What kind of equipment do they have available? Accessibility. Does the vendor provide local or regional support? Maintenance and Guarantees. Will they maintain their product? Are there warranties? Teaching Tips This slide corresponds to Figures 10.23 & Figure 10.24 on pp. 361 & 362 and relates to the material on pp. 361 and 262. © 2002 McGraw-Hill Companies

Evaluating IS Services IS Evaluation Factors Performance Systems Development Maintenance Conversion Training Backup Accessibility Business Position Hardware Software In today’s e-business environment, acquisition of hardware, software, and IS services is an important part of e-application development. How should companies make such acquisition choices? What process should they use for selecting vendors? Larger businesses may require suppliers to present bids and proposals based on system specifications developed during the design phase. Many e-businesses formalize these requirements into a document called an RFP (request for proposal). The selection process may sometimes involve a live test demo of software or hardware functionality, or a benchmark test, which is used to evaluate system performance through simulation of typical processing tasks. In each case hardware and software evaluation factors are used to judge the suitability of the component. Teaching tip: Consider discussing the individual factors shown on the slide. When acquiring IS services, other evaluation factors need to be considered. These include: Past Performance. Referrals from past customers is essential. Business Position. Is the vendor financially strong, with good industry prospects? Service and Capabilities. What kind of services can they offer? What kind of equipment do they have available? Accessibility. Does the vendor provide local or regional support? Maintenance and Guarantees. Will they maintain their product? Are there warranties? Teaching Tips This slide corresponds to Figure 10.25 on pp. 363 and relates to the material on pp. 362. © 2002 McGraw-Hill Companies

Implementing New Systems Implementation Activities Acquisition Software Development Training Testing Documentation Conversion In today’s e-business environment, acquisition of hardware, software, and IS services is an important part of e-application development. How should companies make such acquisition choices? What process should they use for selecting vendors? Larger businesses may require suppliers to present bids and proposals based on system specifications developed during the design phase. Many e-businesses formalize these requirements into a document called an RFP (request for proposal). The selection process may sometimes involve a live test demo of software or hardware functionality, or a benchmark test, which is used to evaluate system performance through simulation of typical processing tasks. In each case hardware and software evaluation factors are used to judge the suitability of the component. Teaching tip: Consider discussing the individual factors shown on the slide. When acquiring IS services, other evaluation factors need to be considered. These include: Past Performance. Referrals from past customers is essential. Business Position. Is the vendor financially strong, with good industry prospects? Service and Capabilities. What kind of services can they offer? What kind of equipment do they have available? Accessibility. Does the vendor provide local or regional support? Maintenance and Guarantees. Will they maintain their product? Are there warranties? Teaching Tips This slide relates to the material on pp. 364-367. © 2002 McGraw-Hill Companies

Installation Conversion Methods Old System New System Parallel Pilot Phased Plunge When the development of a system will replace or improve a current system, a conversion process will be needed. Conversion methods are used for managing system change and managing both the cost and risk associated with a failure of the new system.. Four major forms of system conversion are common: Parallel. This involves operating both the old and the new system at the same time for some period until the project development team and end user management agree to switch over completely to the new system. This is the least risky approach but the most costly, since resources must be used to keep both the new and old system operational. Pilot. Here one department or often an off-site office gives the new system a trial run to see how it works and to catch any problems before the system is implemented company-wide. This is a less costly approach. Risk of failure is isolated to the department or office which receives the new system. Phased. Here the new system is implemented gradually throughout the organization according to some diffusion plan, such as department by department, section by section, or even floor by floor. This approach exposes the organization to more risk, but is less costly. Plunge. This "cold turkey" approach ends use of the old system and begins use of the new system all at once. This approach has the highest risk, but is the least costly to implement. Can be considered for non-critical applications, or application improvements that are marginal. Teaching Tips This slide corresponds to Figure 10.27 on pp. 366 and relates to the material on pp. 365-366. © 2002 McGraw-Hill Companies

Managing Organizational Change This slide corresponds to Figure 14.13 on p. 553 and relates to the material on pp. 553-554. Executive Vision Change Management Measurement and Rewards Organizational Design Core Competencies Development Organization Mission and Role Change management requires the involvement and commitment of top management and a formal process or organizational design. Any new process generates some resistance by those affected. To management the implementation of organizational change successfully, managers should attend to the following activities: Executive Vision. Coordinated, strategic change must come from a clear and clearly articulated vision by top management of where the organization is headed. Change Management. Clear plans to spell out how to achieve change and the benefits of change help reduce risk and the cost of change, especially the interpersonal cost of those personnel who fear change. Measurement and Rewards. Successful change requires defining performance criteria in advance. To facilitate implementation and adoption, management should use innovative motivation and compensation schemes linked to changes in behavior. Organizational Design. Change is facilitated when there is a clear plan defining and designing the organizational structure to be built, with clear areas of responsibility and accountability defined. Core Competencies. Management must identify where the organization is in relation to the proposed change and define the core competencies necessary to complete the change, including how to develop or acquire those competencies not yet possessed by the firm. Work Redesign. Once the other five areas are conceptually clear, key work processes can be identified and reengineered to meet the needs of the proposed change. A commitment to continuous improvement is necessary to ensure that the planned change, dynamic in its onset, does not become a static status quo later on. Teaching Tips This slide relates to the material on pp. 367-369. Work Redesign © 2002 McGraw-Hill Companies

Chapter Summary Business professionals and IS specialists use a systems approach to help them develop information system solutions to meet e-business needs. Prototyping is a major alternative methodology to the traditional information system development cycle. It includes the use of prototyping tools and methodologies, which promote an iterative, interactive process. © 2002 McGraw-Hill Companies

Chapter Summary (cont) The application development capabilities built into many end user software packages have made it easier for end users to develop their own e-business applications. The implementation process for IS projects involves acquisition, testing, documentation, training, installation, and conversion. Business professionals should know how to evaluate IT products for acquisition. IT vendor proposals should be based on specifications developed during the design phase. © 2002 McGraw-Hill Companies

Chapter Summary (cont) Implementation activities include managing the introduction and implementation of changes in the business processes, organizational structures, job assignments, and work relationships resulting from e-business initiatives. © 2002 McGraw-Hill Companies