1. Organisational Themes
Chapter 4
Organisational
Themes
This chapter groups together themes that address IS for the organization as a whole: their inter-connection, strategic use, re-engineering and planning.

2. Themes in IS development
Important themes in IS development have arisen over time, partly out of the debate over SDLC
organizational needs: systems approach, strategic IS, BPR, IS planning, project management, stages of growth
modelling of data, processes, objects
engineering and construction of information systems
software engineering
role of people in ISD: participation, expert systems, end-user computing, knowledge management, customer orientation
external development: packages, ERP, outsourcing

3. Learning Objectives Describe system thinking.
Define human activity system.
Determine Information system strategy & ISP
Determine Benefit realization
Summarize BPR
Restate several models pertaining to IS & organizational themes.
At the conclusion of this lesson the student will be able to:

4. The concept of system systems are open or closed to their environment
materials move across the boundary of an open system open systems maintain a balance with the environment (homeostasis) through negative feedback
open systems tend to increase in orderliness through internal elaboration (negative entropy)
open systems are goal directed but non-deterministic: ends are achievable by a variety of means (equifinality)
a system is a collection of parts which interact with one another
a system does something, or is for something
the parts function so as to contribute to the operation of the system as a whole (synergy)
the behaviour of the whole is not the sum of the behaviours of the parts, but arises from the interaction of the parts (emergence)
the parts are organized in a hierarchy

5. The organization as a system
ENVIRONMENT
/MARKET
targets
standards
norms..
CONTROL
external indicators
actual
performance
OUTPUTS
- products
- services
- waste
INPUTS
- materials
- energy
- information
- components
TRANSFORMATION
PROCESSES
BOUNDARY

6. Systems thinking (1/4) Systems Boundary Environment Open systems
Purpose
Soft systems
Systems theory started taking shape in the late 1920s as a result of increasing doubts
about the ability of classical science to deal with complex phenomena. The basic
principles of classical science are to break down problems into as many separate simple
parts as possible and to try to discover one-way causality between the elementary unit
or variables of these parts. This approach has worked with impressive results in fields
such as physics, but was less successful in fields studying complex entities, such as
biology, psychology the social sciences, which have to cope with many variables, and
need to understand their order and organisation.
Such concerns led to the development of the 'General Systems Theory', a logico-
mathematical field which attempted to formulate principles of 'systems' applicable to all
sciences. A wealth of models, mathematical techniques and concepts were developed,
many of which are applicable across conventional disciplines, addressing issues of
interrelations within a 'whole'. These models, techniques, and concepts are general
abstractions in the sense that they do not consider the nature of elements and forces in a
'system'. General Systems Theory amounts to a conceptual approach for the study of
complex phenomena, rather than a specific 'theory‘
The most influential reference theories in the information systems have been systems
theory, organisational rationalism, socio-technical theory, structuration, and critical
Theory.
Source:

7. Systems thinking (2/4)
Systems thinking is a mental model that promotes the belief that the component parts of a system will act differently when isolated from its environment or other parts of the system. It includes viewing systems in a holistic manner. It promotes gaining insights into the whole by understanding the linkages and interactions between the elements that comprise the whole "system".
Systems Thinking recognizes that all human activity systems are open systems; therefore, they are affected by the environment in which they exist. Systems Thinking recognizes that in complex systems events are separated by distance and time; therefore, small catalytic events can cause large changes in the system. Systems thinking acknowledges that a change in one area of a system can adversely affect another area of the system; thus, it promotes organizational communication at all levels in order to avoid the silo effect.
Forrester (1968) defines systems boundary as a system closure which encloses a system of interest, a system with purpose. Given a purpose, he states, a boundary should include the smallest possible number of components that are linked together with a quantified causality. The boundary of a system is the imaginary line separating what is inside from what is outside for modelling purposes. Richardson and Pugh (1981) explain, "if one insists on the view that everything is connected to everything else, one is paralysed, prevented from ever concluding an analysis that always stretches on to yet more variables and effects." (p42).
Source: Unfolding Systems Boundary: Evolution and Implication

8. Systems thinking (3/4) Systems thinkers consider that:
a "system" is a dynamic and complex whole, interacting as a structured functional unit
information flows between the different elements that compose the system
a system is a community situated within an environment
information flows from and to the surrounding environment via semi-permeable membranes or boundaries
systems are often composed of entities seeking equilibrium, but can exhibit oscillating, chaotic, or exponential growth/decay behavior

9. Systems thinking (4/4)
Systems thinking uses a variety of techniques that may be divided into:
Hard systems - involving simulations, often using computers and the techniques of operations research. Useful for problems that can justifiably be quantified. However it cannot easily take into account unquantifiable variables (opinions, culture, politics, etc), and may treat people as being passive, rather than having complex motivations.
Soft systems - Used to tackle systems that cannot easily be quantified, especially those involving people interacting with each other or with "systems". Useful for understanding motivations, viewpoints, and interactions but, naturally, it doesn't give quantified answers. Soft systems is a field that the academic Peter Checkland has done much to develop.
Think systemically before proceeding systematically
Source: Wikipedia

10. What is systemic thinking?
Systemic thinking is:
thinking in terms of situation-wide patterns and a simple technique for surfacing those situation-wide patterns
What does “systemic” mean?
Systemic means “situation-wide” – or “throughout the entire situation”.
A systemic problem is a situation-wide problem – a problem that occurs throughout the entire situation.
A systemic solution is a situation-wide solution – a solution that applies across the entire situation.
The word systemic comes from the recognition that everything is part of a system – in other words, everything interacts with the things around it.  Systemic actually means “system-wide” or “throughout the system”, but many people can’t help thinking that system means “computer system,” so we talk in terms of “situation-wide” patterns instead of “system-wide” patterns.

11. Human Activity System
HAS is an assembly of people and other resources organized into a whole in order to accomplish a purpose.
The people in the system are affected by being in the system, and by their participation in the system they affect the system. People in the system select and carry out activities -- individually and collectively -- that will enable them to attain a collectively identified purpose.
Source:

13. The structure of human activity (Engeström, 1987, p
The structure of human activity (Engeström, 1987, p. 78 from the page:

14. Information systems strategy
Efficiency
Cost-benefit
Competitive advantage
Effectiveness
Redefine the boundaries of particular industries
Develop new products or services
Change the relationships between suppliers and customers
Establish barriers to deter new entrants to marketplaces
IS strategy is the plan an organization uses in providing information services.
IS allows a company to implement its business strategy.
Business strategy is a function of competition (What does the customer want and what does the competition do?), positioning (In what way does the firm want to compete?), and capabilities (What can the firm do?); IS help determine the company’s capabilities.
ISS - stress the planning required to develop an organisation’s information
systems. Emphasis is placed on the importance of spending time planning
how ISs will be used, incorporated into the organisation, and how this
will change the nature of jobs done within the organisation
Plan for the use of IS/IT to achieve the business objectives: Make sure
any changes proposed are in line with these objectives
Avoid a piecemeal approach to IS development: Try and ensure a
holistic view of the organisation is taken when thinking about what IS
would be good to incorporate.
Ensure planning done at three levels: long term, medium term, short
term.

15. Benefit realisation
Benefit Realisation is the process of realising actual outcomes by breaking down strategic objectives via programmes and projects then monitoring the outputs to confirm intended benefits have actually been achieved
Benefit realisation IS NOT only about whether the project delivered things on time to budget etc.

16. The Levels of Benefit Realisation
Strategies implemented
Economic & ‘Customer’ Value add
Organisation success.
Business Objectives are met
financial, performance,
Fitness for purpose
Project success.
Time, cost, quality
results versus project
plan.
Project management success.

17. Porter’s framework of competitive strategy

18. Porter’s framework of competitive strategy
It deals with the industry and competitive dynamics
It highlights that competition is not simply concerned with the action of rivals
It facilitates discussion and is based on sound principles of industrial economics
It focuses on the few dominant forces necessary

19. Strategic role of IT (Earl, 1989)

20. IT strategies
Technology driven model
Competitor-driven model

21. Earl’s multiple methodology

22. Current systems audit grid
Technical Quality: Reliable?
Maintainable?
Cost-Efficient?
Business Value:
Necessary?
Easy to use?
How often used?

23. Using the Grid
Place systems in their boxes, using judgement, and factual analysis.
A Low value + Low quality = Get Rid
A High value + Low quality = Upgrade
A Low value + High quality = Do we need it?
A High value + High quality = Ace area
Output From IS Strategy
‘To create a robust information management framework for the long-term management of information and its supporting technologies.
To identify current and future information needs for the organisation that reflect close alignment of business and IS strategies.
Determine policies for the management, creation, maintenance, control and accessibility of the corporate information resource.
Ensure that the IS function is outward looking and not focused internally on technology issues.’ Earl M, Managing Strategies for Information Technology

24. Business process re-engineering (BPR)
The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed (Hammer & Champy, 1993)
Business process re-engineering systems involves
Examining the current practice / current systems a company uses
and
•Deciding on the potential usefulness of such systems
•Deciding on how the existing systems could be used in more
efficient ways / used to provide added benefit.
In short, BPR can be classified as:
•“the fundamental rethinking and radical redesign of business
processes to achieve dramatic improvements in critical,
contemporary measures of performance, such as cost, quality,
service, and speed”
Hammer and Champy (1993)
•what an organisation should do, how it should do it, what its
concerns should be, not what they currently are

25. Reasons why organisations re-engineer
They face severe commercial pressures and have no choice
Competitive forces present problems unless the organisation takes radical steps to re-align business processes with strategic positioning
Management in the organisation regard re-engineering as an opportunity to take a lead over the competition
Publicity about BPR has prompted organisations to follow the lead established by others
Why might a company wish to carry out business process re-engineering?
Lots of possible reasons:
- They have no choice commercially. Current operations are causing the company to lose money, so they must find a new way of doing what they do.
- Competitive forces require re-aligning business processes with strategic positioning.
For example: competitors have bought more efficient machinery than our company uses meaning they can meet demand for a product quicker than us. Unless our company does the same, customers will choose the other company over us, who can meet their demand quicker.
- Organisation management see re-engineering as an opportunity to streamline and to overtake their competitors. For example, if we buy in more efficient machinery than our competitors, customers will choose us over other companies, as we can meet their demand quicker.
§ The “band wagon” effect: copy the competitors. Everyone else is changing how they operate, so let’s do the same.

26. Outcomes of BPR programmes
Flatter organisational structures
Greater focus on customers
Improved teamwork, leading to a more widespread understanding of the roles of others

27. BPR ‘slash and burn’ (Grover)
Unfortunately, many corporations responded to reengineering by performing major work force reductions under the aegis of reengineering. Such efforts were not strategically driven, and led to firms losing vital components of the work force that reduced their ability to be creative and productive ... Optimizing process at the cost of people has been a major problem of reengineering

28. Framework of BPR (Melao and Pidd, 2000)

29. Information systems planning
Long-term planning
Medium-term planning
Short-term planning

30. Tasks of information systems strategy group
An assessment of the strategic goals of the organisation, which could be long-term survival, increasing market share, increasing profits, increasing return on capital, increasing turnover or improving public image
An assessment of the medium-term objectives to be used as a basis for allocating resources, evaluating managers’ performance, monitoring progress towards achieving long-term goals, establishing priorities
An appreciation of the activities in the organisation, such as sales, purchasing, research and development, personnel and finance

31. Tasks of information systems strategy group (continued)
An appreciation of the environment of the organisation, that is, customers, suppliers, government, trade unions and financial institutions, whose actions will affect business performance
An appreciation of the organisational culture relating to values, networks and ‘rites and rituals’
An appreciation of the managerial structure in terms of the layers of management or matrix structure, types of decision made, the key personnel and types of information needed to support the key personnel in their decision making
An analysis of the roles of key personnel in the organisation

32. Planning guidelines (Lederer and Mendelow, 1989)
Develop a formal plan
Link the information systems plan to the corporate plan
Plan for disaster
Audit new systems
Perform a cost-benefit analysis
Develop staff
Be prepared to change
Ensure information systems development satisfies user needs
Establish credibility through success

33. Stages of growth (Nolan)
Scope of the applications portfolio
Focus of the IT organisation
Focus of IT planning and control
Level of user awareness
R L Nolan’s organizational stages model of IT growth
well known, influential
pattern repeats with each major innovation - no short-cuts!
evolutionary model - shows logic, but not mechanisms of change

34. Stages of growth

35. Features of the Nolan stages
organization
scattered technical specialists
start of user-oriented services
middle management control
computer centre/ user account teams
database admin/ information centre
information resource management
control
absent or lax
uncontrolled spread of IT
formal project/ operations control
more tailored to organization
shared data/ linked systems
within corporate planning
applications
selected for efficiency gain
proliferate indiscriminately
upgraded, restructured
rebuilt to fit DBMS
becoming more integrated
aligned to org. structure
users
few involved
moreinvolved,
but lack skill
blamed for failures, excluded
involved in design, becoming accountable
responsible for own systems
joint responsibility with IT Dept
initiation
contagion
control
integration
data admin.
maturity
initiation
contagion
control
integration
data admin.
maturity

36. Stages of growth (Hirschheim, et al. (1988)
Delivery
Re-orientation
Re-organisation

37. Stages of growth (Galliers and Sutherland, 1991)
Ad hocracy
Starting the foundations
Centralised dictatorship
Democratic dialectic and cooperation
Enrepreneurial opportunity
Integrated harmonious relationships

38. Flexibility (Evans, 1991)
Pre‑emptive manoeuvres creating options, inflicting surprise or seizing initiatives
Protective manoeuvres insuring against losses, hedging, or creating buffers against adverse conditions
Corrective manoeuvres the ability to recover from adverse situations and learn from mistakes Democratic dialectic and cooperation
Exploitive manoeuvres capitalising on opportunities and consolidating advantages

39. Flexibility
The designers do not know what the information system is to do.
The organisation may not know how user requirements will develop after the information system has been introduced.
The designers may not be certain that the chosen development methodology will deliver precisely what is required.

40. Project management Critical path or PERT analysis CoCoMo
Function point analysis
Project 2000
PRINCE

41. End of Chapter 4
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