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Chapter 13

COMMERCE 2KA3 Chapter Notes - Chapter 13: Business Process Management, Six Sigma, Pilot Experiment

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Commerce 2KA3
Chapter 13: Develop Information Systems
Systems as Planned Organizational Change
There are four kinds of structural organizational change that are enabled by information
technology: 1) automation, 2) rationalization, 3) business process redesign, 4) paradigm
Automation: most common form of It enabled organizational change is automation. First
applications of info tech involved assisting employees with performing their tasks more
Rationalization of Procedures: a deeper form of change is one that follows quickly from
early automation. Automation frequently bottlenecks in production and makes the existing
arrangement of procedures and structures painfully cumbersome
Total Quality Management (TQM): makes achieving quality an end itself and the
responsibility of all people and functions within an organization
Six Sigma: is a specific measure of quality, representing 3.4 million defect opportunities.
Most companies cannot achieve this level of quality but use six sigma as a goal
Business Process Redesign, in which business processes are analyzed, simplified, and
Paradigm shift: involves rethinking the nature of the business and nature the
organization, a radical form of change
Business Process Management (BPM): provides a variety of tools and methodologies to
analyze existing processes, design new processes, and optimize those processes. BPM is
never concluded because process improvement requires continual change
1. Identify Process for Change: one of the most important strategic decisions that
a firm can make is not deciding how to use computers to improve business
processes, but understating what business processes need improvement
2. Analyze Existing processes: existing processes should be modelled and
documented, noting inputs, outputs, resources, and the sequence of activities
3. Design the new Process: once the existing process is mapped and measured in
terms of time and cost, the process design team will try to improve the process
by designing a new one
4. Implementing the New Process: once the new process has been thoroughly
modelled and analyzed, it must be translated into a new set of procedures and
work rules
5. Continuous Measurement: once a process has been implemented and
optimized it needs to be continually measured, to mitigate deterioration
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Overview of Systems Development
System development: is a structured kind of problem solving with distinct activities.
These activities consist of system analysis, system design, programming, testing,
conversion, and production and maintenance
System Analysis: is the analysis of a problem that a firm tries to solve with an information
system. It consists of defining problem, identifying its cause, specifying the solution, and
identifying the information requirements that must be met by a system solution
Feasibility Study: systems analysis also typically includes feasibility study to determine
whether that solution is feasible, or achievable, from financial, technical, legal, and
organizational standpoint.
Information Requirements: at the most basic level, the information requirements of a
new system involve identifying who needs what information, where, when, and how.
Systems Design: systems analysis describes what a system should do to meet information
requirements and system design shows how the system will fulfill this objective
End users must have sufficient control over the design process to ensure that the system
reflects their business priorities and information needs, not the biases of the technical staff
Programming: during this stage, system specifications that were prepared during the
design stage are translated into software program code
Testing: exhaustive and thorough testing must be conducted to ascertain whether the
system produces the right results. Testing answers questions
Unit testing: or program testing, consist of testing each program separately in the system.
System testing: tests the functioning of the information system as a whole. It tries to
determine whether discrete modules will function together as planned and whether
discrepancies exist between the way the system works and how it was conceived
Acceptance Testing: provides the final certification that the system is ready to be used in a
production setting. Systems test are evaluated by users and reviewed by management.
Test Plan: includes all the preparation for the series of test we have just described
Conversion: is the process of changing from the old system to the new system. Four main
conversion strategies can be employed: the parallel strategy, the direct cutover strategy,
the pilot study strategy, and the phased approach
Parallel Strategy: both the old system and its potential replacement, are run together for a
time until everyone is assured that the new one functions correctly.
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