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KISII UNIVERSITY

COURSE OUTLINE

INM 323/LINS 450: MANAGEMENT INFORMATION SYSTEMS I

LECTURER: MR CHARLES NYATANGI MISATI

TEL:0722 849 625 E-MAIL: [email protected]

ACADEMIC YEAR:2015/2016 SESSION:MAY – SEP 2015 CF: 3.0

PRE-

REQUISITE

Students must be able to read and write at the college level.

AIM This course aims at emphasize the use of computers and technology

throughout their high school, college, and future careers. Students will

learn fundamental concepts of computer hardware and software and

become familiar with a variety of computer applications, including word

processing, spreadsheets, databases, and multimedia presentations.

Students will also investigate Internet-based applications, working with

email and learning how to browse the web.

COURSE

PURPOSE

To obtain understanding of the concepts of Information Technology and

its applications. Become familiar with the use of Information

Technology tools.

COURSE

OBJECTIVES Upon completion of this course, the student will be able to:

• Identify and discuss the four main functions of computer

hardware: input, processing, output, and storage.• Identify and describe major hardware components.

• Identify, describe and use communications and networking

terminology and technology to include Internet operations and its

uses.

• Describe the major operating system functions and demonstrate

usage of operating system services to include: disk management,

file management, and memory management.

• Identify and discuss computer ethics and security issues.

• Demonstrate searching, validation, and evaluation of information

found online and in library databases.

• Identify, discuss and use important categories of application

software: word processing, spreadsheet, database management,

and presentation graphics.

• Identify and discuss software development processes and

programming languages.

EXPECTED

LEARNING

Upon completion of this course, students will:

• Be able to identify computer hardware and peripheral devices

mailto:TEL:%20

mailto:TEL:%20

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OUTCOME • Be familiar with software applications

• Understand file management

• Accomplish creating basic documents, worksheets, presentations

and databases

• Distinguish the advantages and disadvantages of networks

• Experience working with email and recognize email netiquette

• Explore the Web and how to conduct research

• •dentify computer risks and safety

COURSE

DESCRIPTION

Introduction to Computer Applications is designed to familiarize

students with computers and their applications. It will also emphasize

the use of computers and technology throughout their high school,

college, and future careers. Students will learn fundamental concepts of

computer hardware and software and become familiar with a variety of

computer applications, including word processing, spreadsheets,

databases, and multimedia presentations. Students will also investigate

Internet-based applications, working with email and learning how to

browse the web. Coursework also includes activities that explore social

and ethical issues related to computers.

COURSE CONTENTS/TOPICS

1.0Management Information Systems

Introduction to Management Information Systems

Characteristics of an effective MIS

Role of Management Information Systems

Information Technology

2.0Information systems

Introduction

Role of Information Systems

Components of an information system

Functions of an information system

Types of Computer Based Information Systems

Levels of management

3.0Concepts of information Introduction

Types of information

Sources of Information

Characteristics of Information

Presentation of Information

Role of information

4.0 The systems concepts

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Introduction

Systems theory concepts

Features of systems theory

Components of systems

Importance of systems study

Characteristics of a system

Classification of systems

System change-over

5.0Information systems development

Introduction

Systems Development Life Cycle

Outsourcing

TEACHINGMETHODOLOGIES

Lectures, Discussions, Assignments, Tutorials, Classpresentations, Handouts, Internet Research

EVALUATION CAT 1 = 10%

Individual Assignments (2) = 10%

Class Presentations = 10%

End of Semester Exam = 70%

TOTAL 100%

REFERENCES:-

1.Sanders, D.H., "Computer Today ", Mc-Graw Hill, 1988.

2.Suresh K. Basandra, “Computers Today”, Galgotia Publications Pvt. Ltd.

3.Microsoft Web Publishing Step by Step, Active Education.

4.Bokhari & Ahmad “UNIX Operating System”, Dhanpat Rai & Co.

5.Raja Raman V., "Fundamental of Computers" (4th edition.), Prentice Hall of India,

New

6.Delhi.Trainer T., et al, "Computers”, McGraw Hill.

7.Norton, Peter, “Introduction to Computers, Mc-Graw-Hill.

8.B. Ram, “Computer Fundamentals”, New Age International Pvt. Ltd.

9.S.Jaiswal, “Fundamental of Computer & IT”, Wiley dreamtech India.

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Chapter one

Management Information Systems

Introduction to Management Information Systems

1.Management- is the process by which resources are combined to achieve a given

task. Management contains the processes or activities that describe what

managers do in the operation of their organization: plan, organize, initiate, and

control operations. In other words, management refers to a set of functions and

processes designed to initiate and coordinate group efforts in an organized setting

directed towards promotion of certain interest, preserving certain values and

pursuing certain goals. It involves mobilization, combination, allocation and

utilization of physical, human and other needed resources in a judicious manner

by employing appropriate skills, approaches and techniques.2.Information- is sets of facts, figures and symbols processed for the current

decision-making situation. The information is considered to be of significance in a

particular situation.

3.System- it is a set of components that were as a unit or system may be defined as

a set of interrelated elements that operate collectively to accomplish some common

purpose or goal.

4.Management Information System (MIS)

i. It is system that helps in collecting, organizing and displaying information

for workers and managers in an organization to support them in making

decisions.

ii. MIS are sets of associated processes, activities individuals or entities

interacting together to provide processed data to managers at various levels

and functional areas.

iii. MIS is a system which provides information support for decision making in

the organization.

iv. MIS is an integrated system of man and machine for providing the

information to support the operations, the management and the decision

making function in the organization.

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v. MIS is a system based on the database of the organization developed for the

purpose of providing information to the people in the organization.

Characteristics of an effective MIS

1.Consistency-MIS must broadcast complex information throughout the company. An

effective MIS will be used to make relevant decisions at all managerial levels so long

as the information contained is consistently added. Companies need to establish

input and data collection procedures that all relevant employees follow to ensure

uniformity. Establishing a data collection monitoring system will reduce

inconsistencies. Communicate all changes in data collection procedures to

appropriate compilers.

2.Objectivity- The information collected and entered into the MIS must be consistent,

accurate and objective. Data compilers cannot selectively input information that

purposely skews managerial decisions one way or another. The effective MIS contains

a methodology for objective recording and assemblage of information.

3.Completeness- All data recorded in an MIS must be complete. All angles of an issue

need to have corresponding data to provide decision-makers with a full view ofcomplex issues and problems. Where reports can be generated, information

summaries must not be myopic in scope, to effect positive results.

Role of Management Information Systems

1.The MIS ensures that an appropriate data is collected from the various sources,

processed, and sent further to all the needy destinations.

2.The MIS fulfill the information needs of an individual, a group of individuals, the

management functionaries: the managers and the top management.

3.The MIS satisfies the diverse needs through a variety of systems such as Query

Systems, Analysis Systems, Modeling Systems and Decision Support Systems the

MIS helps in Strategic Planning, Management Control, Operational Control and

Transaction Processing.

4.The MIS helps the clerical personnel in the transaction processing and answers

their queries on the data pertaining to the transaction, the status of a particular

record and references on a variety of documents.

5.The MIS helps the junior management personnel by providing the operational data

for planning, scheduling and control, and helps them further in decision making

at the operations level to correct an out of control situation.

6.The MIS helps the middle management in short them planning, target setting andcontrolling the business functions. It is supported by the use of the management

tools of planning and control.

7.The MIS helps the top management in goal setting, strategic planning and evolving

the business plans and their implementation.

8.The MIS plays the role of information generation, communication, problem

identification and helps in the process of decision making. The MIS, therefore,

plays a vital role in the management, administration and operations of an

organization.

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Information technology is the acquisition, processing, storage and distribution of

vocal, pictorial, textual and numerical information by a microelectronics-based

combination of computing and telecommunication

Information technology is the collection, storage, processing, distribution and use of

information.

Components of information technology

1.Computer technology- the wide spread use of computer technology has made

dramatic development in the information transmission processes and in every field

of human endeavor during the past few years. The current development in

computer technology included mini computers, microcomputers, speaking

computers and different types of software developments.

2.Communication technology- a communication system in its simplest form

consists of a transmitter, a channel and a receiver. The channel is saddled with

noise that special considerations like amplification of signal and filtering of noise

are required. The original signal to be transmitted is rarely in the form required for

transmission.

3.CD-ROM technology- the combination of computers and lasers has led to a

compaction of information into small lines. This has optical computing holography

neural networking, optical connection, laser printers, laser scanner and optical

storage. CD-ROM is acronym that stands for compact disc read only memory. Data

is recorded in digital form using laser beam. User can only read the disc, but

cannot write on it nor can erase anything written on it.

4.Reprography, micrographic and printing technology- the technology of

reprography makes a big impact on the document delivery systems. Most theresearch have reprographic and provide photocopies of any document on demand.

By using micrographic and reprographic techniques, we can condensed the bulky

archives and newspapers and solve the storage problem. They also serve the

purpose of preservation and help in resource sharing and save the time of users.

Impact of information technology

1.Increased computer power leading to faster and cheaper computer processing

which facilitated automation of low budget.2.Improved telecommunication with greatly increased capacity for data

transmission, which facilitated the introduction of new services such as electronic

mail, fax, teleconferencing, etc

3.Cheaper data storage, such as optical storage media that increased the storage

capacity.

4.Better data transfer between different system and media such as coaxial cables,

optical fiber cables; satellite communication etc has promoted the resources

sharing.

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5.Increased reliability of hardware and software, which has increased the

performance efficiency.

6.User friendly systems that are developed to enhance the interface between

technology and the users.

How IT has transformed organizations

1.Unemployment-one of the objectives of the introduction of new information

technology is to perform various production and clerical tasks more efficiently and

to minimize the time that professionals and management spend in gathering

information and decision making.

2.Data protection- data protection and associated legislation is concerned with the

privacy of the individual the advert of computer databases and their ability to hold

personal data transmit it to other databases and allow various people and

organizations direct access to it, has considered potential for misuse and the

infringement of individual privacy.

3. Trans border data flows- Trans border is generally considered to be the electronic

flow of information across national boundaries. The information that flows may

include various kinds of database with business banking and personal data being

some of those sensitive categories.

4.Copyright- the objective legislation is to protect the work of the author on creator

of a piece of work form indiscriminate copying, so that the creator is able to

benefit sufficiently to make continuing creativity work while.

5. Archiving and bibliographical control- The creation of an active is the process

whereby a permanent record is kept of text and data for reference to historical

purposes. They should also attempt to maintain bibliographic records ofdocuments containing this knowledge

Challenges

1.Switch over to new technology- the introduction of new technologies have created

the problem that how traditional forms could be integrated with the electronic

resources.

2.Lack of skilled manpower- it is seem that the workers do not take much interest in

gasping new technologies.3.Financial constraints- the introduction of modern technology and their associated

system are out of pocket and out of the reach of the users due to its high changes.

Further to develop infrastructure facilities and to access the electronic sources

through communication a network much costs is needed.

4.Assessment of electronic publications- the electronic publications are available in

various forms and format. The concept of evaluation in order to assess the

relevance of information available in electronic format in another problem.

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5.Training of professionals and end users- extra staff and funds are needed to train

the present staff and users to get acquainted themselves with the modern

technologies.

Chapter two

Information systems

1.An information system is an arrangement of a number of elements that provides

effective information for decision-making and / or control of some functionalities

of an organization.

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2.An information system is a set of interrelated components that collect,

manipulate, process and transform data into information and provide feedback to

meet a specified objective.

3.An information system can be defined as a set of organized components that

collect, process, store and distribute information to support decision making and

control in an organization.

4.An information system that uses the resources of people, hardware, software andcommunication technology to perform input, processing, output, storage and

control activities that convert data resources into information products

Environment

Feedback &Control

Role of Information Systems

1.Information system will help managers in effective decision-making to achieve the

organizational goal.

2.Based on well-designed information system, an organization will gain edge in the

competitive environment.

3.Information systems help take right decision at the right time.4.Innovative ideas for solving critical problems may come out from good information

system.

5.Knowledge gathered though information system may be utilized by managers in

unusual situations.

6.If information system is viewed as a process it can be integrated to formulate a

strategy of action or operation.

Components of an information system

1.People – These use the system to fulfill their informational needs. They include endusers and operations personnel such as computer operators, systems analysts,

programmers, information systems management and data administrators.

2.Computer Hardware – Refers to physical computer equipment and devices, which

provide for five major functions.

o Input or data entry

o Output

o Secondary storage for data and programs

o Central processor (computation, control)

Input OutputProcesses

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o Communication

3.Computer Software – Refers to the instructions that direct the operation of the

computer hardware. It is classified into system and application software.

4.Telecommunication System/Communication network

5.Databases – Contains all data utilized by application software. An individual set of

stored data is referred to as a file. Physical storage media evidences the physical

existence of stored data, that is: tapes, disk packs, cartridges, and diskettes.

6.Procedures – Formal operating procedures are components because they exist in

physical forms as manuals or instruction booklets. Three major types of procedures

are required.

Functions of an information system

The functions of an information system can be generally classified into those functions

involved in:

1.Transaction processing

2.Management reporting3.Decision support

Transaction processing

Major processing functions include:

1.Process transactions – Activities such as making a purchase or a sale or

manufacturing a product. It may be internal to the organization or involve an

external entity. Performance of a transaction requires records to:

Direct a transaction to take place Report, confirm or explain its performance

Convey it to those needing a record for background information or

reference.

2.Maintain master files – Many processing activities require operation and

maintenance of a master file, which stores relatively permanent or historical data

about organizational entities. E.g. processing an employee paycheck needs data

items such as rate of pay, deductions etc. transactions when processed update

data items in the master file to reflect the most current information.

3.Produce reports – reports are significant products of an information system.Scheduled reports are produced on a regular basis. An information system should

also be able to produce special reports quickly based on ‘ad hoc’ or random

requests.

4.Process inquiries – Other outputs of the information system are responses to

inquiries using the databases. These may be regular or ad hoc inquiries.

Essentially inquiry processing should make any record or item in the database

easily accessible to authorized personnel.

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5.Process interactive support applications – The information system contains

applications to support systems for planning, analysis and decision making. The

mode of operation is interactive, with the user responding to questions,

requesting for data and receiving results immediately in order to alter inputs until

a solution or satisfactory result is achieved.

Management reporting

This is the function involved in producing outputs for users. These outputs are mainly

as reports to management for planning, control and monitoring purposes. Major

outputs of an information system include:

1.Transaction documents or screens

2.Preplanned reports

3.Preplanned inquiry responses

4.Ad hoc reports and ad hoc inquiry responses

5.User-machine dialog results

Level of management activity

Senior Manager

Management Level Middle Managers

Knowledge Level Knowledge and data workers

Operational Level Operational Managers

Strategic level/upper level management

It consists of board of directors, chief executive or managing director. The top

management is the ultimate source of authority and it manages goals and policies for an

enterprise. It devotes more time on planning and coordinating functions.

The role of the top management

1.Top management lays down the objectives and broad policies of the enterprise.

2.It issues necessary instructions for preparation of department budgets

procedures, schedules etc.

3.It prepares strategic plans & policies for the enterprise.

4.It appoints the executive for middle level i.e. departmental managers.

Strategic Level

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5.It controls & coordinates the activities of all the departments.

6.It is also responsible for maintaining a contact with the outside world.

7.It provides guidance and direction.

8.The top management is also responsible towards the shareholders for the

performance of the enterprise.

Management level/Tactical level/ middle level management

The branch managers and departmental managers constitute middle level. They are

responsible to the top management for the functioning of their department. They devote

more time to organizational and directional functions. In small organization, there is

only one layer of middle level of management but in big enterprises, there may be senior

and junior middle level management.

The role Management level

1.They execute the plans of the organization in accordance with the policies and

directives of the top management.

2.They make plans for the sub-units of the organization.

3.They participate in employment & training of lower level management.

4.They interpret and explain policies from top level management to lower level.

5.They are responsible for coordinating the activities within the division or

department.

6.It also sends important reports and other important data to top level

management.

7.They evaluate performance of junior managers.

8.They are also responsible for inspiring lower level managers towards better

performance.

Knowledge level systems

Support the organization’s knowledge and data workers. The purpose of knowledge level

systems is to help the business firm integrate new knowledge into the business and to

help the organization control the flow of paperwork. Knowledge level systems, especially

in the form of workstations and office systems are among the faster growing applications

in business today.

Operational level/ lower level management

Lower level is also known as supervisory / operative level of management. It consists of

supervisors, foreman, section officers, superintendent etc. According toR.C. Davis

“Supervisory management refers to those executives whose work has to be largely with

personal oversight and direction of operative employees”. In other words, they are

concerned with direction and controlling function of management.

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The role of lower levels

1.Assigning of jobs and tasks to various workers.

2.They guide and instruct workers for day to day activities.

3.They are responsible for the quality as well as quantity of production.

4.They are also entrusted with the responsibility of maintaining good relation in the

organization.5.They communicate workers problems, suggestions, and recommendatory appeals

etc to the higher level and higher level goals and objectives to the workers.

6.They help to solve the grievances of the workers.

7.They supervise & guide the sub-ordinates.

8.They are responsible for providing training to the workers.

9.They arrange necessary materials, machines, tools etc for getting the things done.

10. They prepare periodical reports about the performance of the workers.

11. They ensure discipline in the enterprise.

12. They motivate workers.

13. They are the image builders of the enterprise because they are in direct

contact with the workers.

Type of decision making

Structured/programmable decisions

Programmed decisions or structured decisions refer to decisions made on problems and

situations by reference to a predetermined set of standards, procedures, techniques and

rules. These are well-structured in advance and are time-tested for their validity. As aproblem or issue for decision-making emerges, the relevant pre-decided rule or

procedure is applied to arrive at the decision. For example, in many organizations, there

is a set procedure for receipt of materials, payment of bills, employment of clerical

personnel, release of budgeted funds, and so on. Programmed decisions are made with

respect to familiar, routine, recurring problems which are amenable for structured

solution by application of known and well-defined operating procedures and processes

Not much judgment and discretion is needed in finding solutions to such problems. It is

a matter of identifying the problem and applying the rule. Decision making is thus

simplified.

Semi-structured/semi-programmable decisions

The information requirements and the methodology to be applied are often known, but

some aspects of the decision still rely on the manager: e.g. selecting the location to

build a new warehouse. Here the information requirements for the decision such as

land cost, shipping costs are known, but aspects such as local labour attitudes or

natural hazards still have to be judged and evaluated by the manager.

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Unstructured/non-programmable decisions

Non-programmed decisions or unstructured decisions are those which are made on

situations and problems which are novel and non-repetitive and about which not much

knowledge and information are available. They are non-programmed in the sense that

they are made not by reference to any pre-determined guidelines, standard operating

procedures, precedents and rules but by application of managerial intelligence,

experience, judgment and vision to tackling problems and situations, which arise

infrequently and about which not much is known. There is no simple or single best way

of making decisions on unstructured problems, which change their character from time

to time, which is surrounded by uncertainty and enigma and which defy quick

understanding. Solutions and decisions on them tend to be unique or unusual-for

example, problems such as a sudden major change in government policy badly affecting

a particular industry, the departure of a top level key executive, drastic decline in

demand for a particular high profile product, competitive rivalry from a previously little

known manufacturer etc. do not have ready-made solutions.

Types of Information Systems

Transaction Processing Systems

• TPSs collect, store, modify, and retrieve thetransactions of an organization.

• A transaction is an event that generates or modifiesdata that is eventually stored

in an information system.

• To be considered a transaction processing system the computer must pass the

ACID test.

• The essence of a transaction program is that it manages data that must be left in

a consistent state. E.g. if an electronic payment is made, the amount must be both

withdrawn from one account and added to the other; it cannot complete only oneof those steps.

Characteristics of TPS:

• TPS are large and complex in terms of the number of system interfaces with the

various users and databases and usually developed by MIS experts.

• TPS’s control collection of specific data in specific formats and in accordance with

rules, policies, and goals of organization- standard format

• They accumulate information from internal operations o the business.

• They are general in nature—applied across organizations.

• They are continuously evolving.

Management Reporting System (MRS)

• They provide routine information to decision makers to make structured,

recurring and routine decisions, such as restocking decisions or bonus awards.

• They focus on operational efficiency and provide summaries of data.

• A MRS takes the relatively raw data available through a TPS and converts it into

meaningful aggregated form that managers need to conduct their responsibilities.

http://en.wikipedia.org/wiki/Transaction

http://en.wikipedia.org/wiki/Data

http://en.wikipedia.org/wiki/ACID

http://en.wikipedia.org/wiki/Transaction

http://en.wikipedia.org/wiki/Data

http://en.wikipedia.org/wiki/ACID

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• They generate information for monitoring performance (e.g. productivity

information) and maintaining coordination (e.g. between purchasing and

accounts payable).

• The main input to an MRS is data collected and stored by transaction processing

systems.

• A MRS further processes transaction data to produce information useful for

specific purposes.

• Generally, all MIS output have been pre-programmed by information systems

personnel. Outputs include:

a)Scheduled Reports – These were originally the only reports provided by early

management information systems. Scheduled reports are produced

periodically, such as hourly, daily, weekly or monthly. An example might be a

weekly sales report that a store manager gets each Monday showing total

weekly sales for each department compared to sales this week last year or

planned sales.

b)Demand Reports – These provide specific information upon request. For

instance, if the store manager wanted to know how weekly sales were going on

Friday, and not wait until the scheduled report on Monday, she could request

the same report using figures for the part of the week already elapsed.

c)Exception Reports – These are produced to describe unusual circumstances.

For example, the store manager might receive a report for the week if any

department’s sales were more than 10% below planned sales.

Characteristics of MRS

• MIS professionals usually design MRS rather than end users- using life cycleoriented development methodologies.

• They are large and complex in terms of the number of system interfaces with the

various users and databases.

• MRS is built for situations in which information requirements are reasonably well

known and are expected to remain relatively stable. This limits the informational

flexibility of MRS but ensures that a stable informational environment exists.

• They do not directly support the decision making process in a search for

alternative solutions to problems. Information gained through MRS is used in the

decision making process.• They are oriented towards reporting on the past and the present, rather than

projecting the future. Can be manipulated to do predictive reporting.

• MRS has limited analytical capabilities. They are not built around elaborate

models, but rather rely on summarization and extraction from the databases

according to the given criteria.

Decision Support System (DSS)

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• Decision support systems provide problem-specific support for non-routine,

dynamic and often complex decisions or problems.

• DSS users interact directly with the information systems, helping to model the

problem interactively.

• DSS basically provide support for non-routine decisions or problems and an

interactive environment in which decision makers can quickly manipulate data

and models of business operations.

• A DSS might be used for example, to help a management team decide where to

locate a new distribution facility.

• When the structure of a problem or decision changes, or the information required

to address it is different each time the decision is made, then the needed

information cannot be supplied by an MIS, but must be interactively modeled

using a DSS.

• DSS provide support for analytical work in semi-structured or unstructured

situations.

• They enable mangers to answer ‘What if’ questions by providing powerful

modeling tools (with simulation and optimization capabilities) and to evaluatealternatives e.g. evaluating alternative marketing plans.

• DSS have less structure and predictable use. They are user-friendly and highly

interactive. Although they use data from the TPS and MIS, they also allow the

inclusion of new data, often from external sources such as current share prices

or prices of competitors.

Elements of DSS

• Data- it is obtained from transaction processing system e.g. source documents

• Model- tool that allows evaluation and analysis of different alternatives under

similar constraints

• User interface- makes use of a graphical user interface that allows the manager/

user to enter commands and seek answers during interrogations

• Decision maker- refers to the manager who should have enormous training and

experience

Executive information system (EIS) / Executive Support Systems (ESS)

• EIS provide a generalized computing and communication environment to senior

managers to support strategic decisions.

• They draw data from the MIS and allow communication with external sources of

information. But unlike DSS, they are not designed to use analytical models for

specific problem solving.

• EIS are designed to facilitate senior managers’ access to information quickly and

effectively.

• ESS has menu-driven user-friendly interfaces, interactive graphics to help

visualization of the situation and communication capabilities that link the senior

executives to the external databases he requires.

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• Top executives need ESS because they are busy and want information quickly and

in an easy to read form. They want to have direct access to information and want

their computer set-up to directly communicate with others. They want structured

forms for viewing and want summaries rather than details.

Advantages of EIS

• Easy for upper-level executives to use, extensive computer experience is not

required in operations

• Provides timely delivery of company summary information

• Information that is provided is better understood

• Filters data for management

• Improves to tracking information

• Offers efficiency to decision makers

Disadvantages of EIS

• System dependent

• Limited functionality, by design

• Information overload for some managers

• Benefits hard to quantify• High implementation costs

• System may become slow, large, and hard to manage

• Need good internal processes for data management

• May lead to less reliable and less secure data

Expert System (ES)

• It is an advanced DSS that provides expert advice by asking users a sequence of

questions dependent on prior answers that lead to a conclusion or

recommendation. It is made of a knowledge base (database of decision rules and

outcomes), inference engine (search algorithm), and a user interface.

• ES use artificial intelligence technology.

• It attempts to codify and manipulate knowledge rather than information

• ES may expand the capabilities of a DSS in support of the initial phase of the

decision making process. It can assist the second (design) phase of the decision

making process by suggesting alternative scenarios for "what if" evaluation.

• It assists a human in the selection of an appropriate model for the decision

problem. This is an avenue for an automatic model management; the user of such

a system would need less knowledge about models.• ES can simplify model-building in particular simulation models lends itself to this

approach.

• ES can provide an explanation of the result obtained with a DSS. This would be a

new and important DSS capability.

• ES can act as tutors. In addition ES capabilities may be employed during DSS

development; their general potential in software engineering has been recognized.

Advantages

• It can be able to account how it has arrived at a given decision

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• They can solve problems in a given domain well or better than human decision

makers.

• They are not emotional in their decision making

• They can apply human knowledge to a well understood problem

• One do not need to be an expert because since a clerk can be as good as a

consultant, if he is supported by an expert system.

Disadvantages

• TheGarbage In, Garbage Out (GIGO) phenomenon: A system that uses expert-

system technology provides no guarantee about the quality of the rules on which it

operates. All self-designated "experts" are not necessarily so, and one notable

challenge in expert system design is in getting a system to recognize the limits to

its knowledge.

• Expert systems are notoriously narrow in their domain ofknowledge — as an

amusing example, a researcher used the "skin disease" expert system to diagnose

his rust bucket car as likely to have developed measles — and the systems are

thus prone to makingerrors that humans would easily spot. Additionally, oncesome of the mystique had worn off, most programmers realized that simple expert

systems were essentially just slightly more elaborate versions of thedecision logic

they had already been using. Therefore, some of the techniques of expert systems

can now be found in most complex programs without drawing much recognition.

• An expert system or rule-based approach is not optimal for all problems, and

considerable knowledge is required so as to not MISapply the systems.

Office Automation Systems (OAS)

•

Office automation systems support general office work for handling and managingdocuments and facilitating communication.

• Text and image processing systems evolved as from word processors to desktop

publishing, enabling the creation of professional documents with graphics and

special layout features. Spreadsheets, presentation packages like PowerPoint,

personal database systems and note-taking systems (appointment book, notepad,

card file) are part of OAS.

• In addition OAS includes communication systems for transmitting messages and

documents (e-mail) and teleconferencing capabilities.

Artificial Intelligence Systems

• Artificial intelligence is a broad field of research that focuses on developing

computer systems that simulate human behaviour, that is, systems with human

characteristics.

• These characteristics include, vision, reasoning, learning and natural language

processing. Examples: Expert systems, Neural Networks, Robotics.

Knowledge Based Systems/ Knowledge Work Systems (KWS)

http://en.wikipedia.org/wiki/Garbage_In,_Garbage_Out

http://en.wikipedia.org/wiki/Knowledge

http://en.wikipedia.org/wiki/Error

http://en.wikipedia.org/w/index.php?title=Decision_logic&action=edit&redlink=1

http://en.wikipedia.org/wiki/Garbage_In,_Garbage_Out

http://en.wikipedia.org/wiki/Knowledge

http://en.wikipedia.org/wiki/Error

http://en.wikipedia.org/w/index.php?title=Decision_logic&action=edit&redlink=1

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• Knowledge Work Systems support highly skilled knowledge workers in the

creation and integration of new knowledge in the company.

• Computer Aided Design (CAD) systems used by product designers not only allow

them to easily make modifications without having to redraw the entire object (just

like word processors for documents), but also enable them to test the product

without having to build physical prototypes.

Geographic Information Systems (GIS)

• Geographic information systems include digital mapping technology used to store

and manipulate data relative to locations on the earth. An example is a marketing

GIS database.

• A GIS is different from a Global Positioning System (GPS). The latter is a satellite-

based system that allows accurate location determination.

Virtual Reality Systems

• Virtual reality systems include 3-dimensional simulation software, where often

the user is immersed in a simulated environment using special hardware (such asgloves, data suits or head mounted displays).

• Sample applications include flight simulators, interior design or surgical training

using a virtual patient.

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REINFORCING QUESTIONS

Question One

(a) What is an information system? What are the various components of an information

system? [6 Marks]

(b) Differentiate between structured and unstructured decisions. Give examples of such

decisions. [4 Marks]

(c) Describe the relevance of the following to a Decision Support System (DSS):

(i) Specialized packages [2 Marks]

(ii) Query Languages [2 Marks]

(iii) Database Management System [2 Marks]

(d) Explain what Office Automation System and Knowledge Work System mean.

[4 Marks]

Question Two

(a) Propose the type of information system you would recommend for the following

applications:

(i) Maintenance of general ledger [1 Mark]

(ii) Formulation of competitive market strategies [1 Mark]

(iii) Financial sensitivity or risk analysis [1 Mark]

(iv) Ticket reservations [1 Mark]

(b) Identify the major factors that influence the structure of an information system.

[4Marks]

(c) Examine the contribution of information systems in the decision-making or problem

solving process [4Marks]

(d) Suggest possible uses for an expert system within the Customer Database

Department. [6Marks]

(e) Why do executives need executive information systems? [2 Marks]

Question Three

(a) Organizational information systems are categorized under:

(i) Transaction Processing System (TPS)

(ii) Management Information System (MIS)(iii) Decision Support System (DSS)

(iv) Executive Information System (EIS)

(v) Expert System (ES)

Required:

Suggest one application of each of the systems types listed above for each of the

following areas of business.

I. Sales and Marketing [5 Marks]

II. Finance [5 Marks]

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(b) The general manager of a large organization has asked you to draw up a document

identifying eight important characteristics against which managers can evaluate the

success of an information system together with a brief explanation of each. What would

your document contain? [8 Marks]

(c) What is artificial intelligence? [2 Marks]

Question Four

(a) Discuss the various components of a Decision Support System. [12 Marks]

(b) When is it appropriate to use a DSS? [8 Marks]

Question Five

(a) Give a brief definition of an Expert System (ES) [3 Marks]

(b) Describe five properties of an expert system. [10 Marks]

(c) What are the components of an expert system? [7 Marks]

Proposed Answers

Question One

(a)An Information System is a collection of people, procedures, software, hardware, and

data.

• All components of an information system work together to provide information to

run an organization.

• Computers are used in an information system to:

- Keep records of events.

- Help make decisions.

The five parts of an information system are:

• People - Individuals who use microcomputers as a tool to fulfill their information

needs.

• Procedures - Written guidelines (documentation) to help end-users use software

and hardware.• Software - Step-by-step instructions (programs) that tell the computer what to do.

• Hardware - The physical components of a computer system such as monitor,

keyboard, mouse, etc.

• Data - Raw, unprocessed facts such as text, numbers, images, and sounds

brought into the computer as input.

(b) Astructured decision is one where there are:

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• Clear rules which govern the outcome of the decision.

• The information upon which the decision is to be based is known.

• The information is readily available.

• The information requires no interpretation.

If these conditions are met, such a decision will be repeatable that is, if the same

information is presented several times, or if different people were to be given the same

information, the decision outcome would be the same in each case.

Examples:

• Deciding the amount of income tax to be deducted from a worker's pay.

• Sending an invoice reminder where the bill has not been paid.

Anunstructured decision is one where:

• There are no clear rules which govern the outcome of the decision.

• The information upon which the decision is to be based is unknown, not readily

available or needs interpretation.• Such decisions may not be repeatable. The same person, on different occasions,

or two different people, might make very different decisions in what appear to be

similar circumstances. Unstructured decisions are greatly affected by ‘gut-

feelings’ or intuition.

Examples:

• Deciding whether and where to build a new supermarket

• Deciding which university to go to and which course to choose.

(c)

i. Used to develop decision-making models. Also known as modeling software.

ii. Allow managers to ask questions about or retrieve information from a database by

forming requests in normal English-like statements.

iii. Provides managers with ability to collect, manipulate maintain and retrieve huge

amounts of data from the database.

(d

Office Automation Systems

• OAS is designed to primarily support data workers.

• OAS focuses on managing documents, communicating, and scheduling.

• It uses word processing, desktop publishing, and other image technologies.

• It uses e-mail, voice messaging, and videoconferencing.

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Knowledge Work Systems

• This type of system is designed to primarily support knowledge workers.

• It focuses on creating information in areas of expertise.

• It uses software such as CAD/CAM

• (Computer-Aided Design/Computer-Aided Manufacturing).

Question Two

(a)

i. Transaction Processing System

ii. Executive Information System

iii. Decision Support System

iv. Transaction Processing System

(b)

i. Types of decisions to be supported by the system

ii. Users – level of knowledge, expertiseiii. Information flow into and out of the system, type of information, sources of

information and uses of information processed

iv. Form of management reporting required

(c)

i. Complete automation of structured decisions scenarios in form of

transaction processing systems such as point of sale systems, reservation

systems, booking systems, automatic teller machines

ii. Partial automation of semi-structured decisions scenarios and provision of

summary reports for managerial control and planning.

iii. Production of exceptional reports and variance reports for managerial

correction

iv. Information collection, consolidation, analysis, summarization and

visualization using graphical means for top level management’s strategic

decision-making and problem solving and support of unstructured

decisions.

v. Provision of knowledge bases, decision models and analytical model to

support the problem solving process.

(d)

i. Credit rating of customers into various credit levelsii. Credit control during a sale to a customer ensuring that credit limits are

not exceeded

iii. Identifying bad debtors and defaulters recommending possible actions to be

taken against them

iv. Creating a provision for bad debts using a predefined criteria

v. Customer profiling

vi. Discount calculations and awards

(e)

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i. Top executives need Executive Support Systems because they are busy and

want information quickly and in an easy to read form (summarized

information).

ii. They want to have direct access to information and want their computer

set-up to directly communicate with others.

iii. They want structured forms for viewing and want capsule summaries

rather than details

Question Three

(a)

Sales & Marketing Finance

TPS - Order Processing

- Customer ledgers

- Billing systems

- Point of sale systems

- Payroll processing

MIS - Periodic analysis of sales by

region, product, volume

- Identification of loyal customers

- Pending bills analysis

- Listing payment defaulters

-Analysing Over/underpayments

- Periodic accounting reports

DSS - Redistribution of resources to

increase sales volume

- Analysing effects on sales of

increasing the workforce

- Increasing petty cash

allocations

- Financial analysis and risk

analysis

- Pay increases

EIS - Competitor analysis

- Sales forecasting

-Impact of government policies on

organizational cash flows

ES - Market trend projections

- Introduction of a new product

line

- Capital Budgeting

- Investment decisions

(b)

i. Systems uptime/downtime – the length of time the system is operational

ii. Systems effectiveness (measures how well a system achieves its goals. It can

be calculated by comparing actual performance to expected performance.)E.g. Budget allocations vs. actual usage – is the system performing within

its cost budget?

iii. Level of integration – how well it performs a variety of applications

iv. Compatibility with existing business systems

v. Degree of complexity in terms of development, installation, maintenance

and learning how to use it

vi. Cost savings achieved as a result of using the system

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vii. Level of efficiency (ratio of what is produced to what is consumed) attained

by the entire organization as a result of adopting the system

viii. System’s security level – is organization’s information and resources

exposed to unauthorized access.

ix. User acceptance

(c) A field that focuses on developing techniques to enable computer systems to perform

activities that are considered intelligent (in humans and other animals).

Question Four

(a)

i. Decision maker

ii. Decision models – analytical tools and techniques. They improve the quality

of the decision made

iii. User Interface/ language subsystem – provides a link between the system

and the manager. It allows a decision maker to use simple statements orcommands to enter requests for analysis purposes

iv. Knowledge base and database – holds internal data and can also access

any external data if needed

v. Hardware components – includes computer terminals, printers, graph

plotters and storage devices

vi. Software components – includes:

• Database management system – enable users to collect, manipulate,

maintain and retrieve huge amounts of data from a database

• Query languages – allow users to ask questions and retrieve data

from a database.

• Specialized software – to develop the decision-making modules

(b)

i. Where the problem is too complex to be solved manually

ii. When there is need to conduct sensitivity analysis to examine the impact of

a change in the variables

iii. When there is need for interaction between a decision maker and DSS

iv. When analysis by stages is involved e.g. where the problem is repetitive with

stages of re-examination or re-assessment

v. When there is need for judgment in complex situations, where judgmentcan’t be taken by the computer.

Question Five

(a)

An expert system is an intelligent computer system which uses knowledge and interface

procedures to solve problems that are difficult enough to require significant human

experts for their solution.

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It is a computer-based system that simulates the human thought process or reasoning

to solve problems which require human expertise. It enables non-experts in a given field

to achieve comparable results to human experts in that field.

(b)

i. Reasons with domain specific knowledge or discipline e.g. geology,

medicine, engineering

ii. Uses domain specific methods which could be heuristic or algorithmic

iii. They perform well in their specific areas i.e. achieve high standards when

compared with human expertise

iv. It explains or makes understandable both what it knows and the reason for

its access

v. It retains flexibility i.e. can be changed or modified as new expertise and

new information is discovered.

(c)

i. Knowledge base – contains the facts of rules recorded as data for the

system.

ii. Inference engine – provides direction, organizes and controls the processingof the knowledge and rules to make inferences based on the problem. It

comprises of three elements i.e.

a.Rules interpreter which effectively creates the rules

b.Scheduler – controls when things should be performed and in what

order

c.Consistency checker – maintains a consistent form of the processes

and resolutions

Inference

Natural Explanation

Knowledge Base

Knowledge

Acquisition

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iii. User interface – provides communication between inference engine and the

expert system user. It conversationally asks the user for the facts related to

conditions in the knowledge base.

iv. Knowledge acquisition program – enables expert systems to acquire new

knowledge and rules

v. Working memory or blackboard – a temporary working space that records

intermediate hypothesis and decisions that expert system makes and

problems as the solutions evolve

vi. Explanation facility – a facility that explains to the user how the expert

system arrives at its conclusions

vii. Some other components include:

a.Language – language in which expert system has been written e.g.

Prolog, Scheme

b.Environment – variety of hardware and software that surrounds an

expert system

c.Shell – an expert system with all the inference capability but without

any domain specific knowledge. It’s thus ready for users to input theirown rules and knowledge to create their own specific expert systems

applications.

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Chapter three

Concepts of information

Definition

Information is facts and observations which outcome when data are processed, and

directly support decision making.

Data on the other hand are facts or observations about physical phenomena or business

transactions.

For information products to be valuable and useful to end user and support sound

decision making it should have the following characteristics or attributes (or qualities):

Sources of Information

Primary information

A primary source of information is one that provides data from an original source

document. This may be as simple as an invoice sent to a business or a cheque received.

It may be more complex, such as a set of sales figures for a range of goods for a tinned

food manufacturer for one week, or it may be a set of sales figures over several weeks

and several locations. There are many examples of primary sources in many walks of

life, but generally a primary source is defined as being where a piece of information

appears for the first time.

Secondary information

A secondary source of information is one that provides information from a source other

than the original. Secondary sources are processed primary sources, second-hand

versions. Examples of secondary sources could be an accounts book detailing invoices

received, a bank statement that shows details of cheques paid in and out. Where

statistical information is gathered, such as in surveys or polls, the survey data or polling

data is the primary source and the conclusions reached from the survey or the results

of the poll are secondary sources.

Internal information

All organizations generate a substantial amount of information relating to their

operation. This internal information is vital to the successful management of the

organization. The information may be available from a number of sources within the

organization, for example:

• Marketing and sales information on performance, revenues, markets shares

distribution channels, etc.

• Production and operational information on assets, quality, standards, etc.

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• Financial information on profits, costs, margins, and cash flows, investments, etc.

• Internal documentation such as order forms, invoices, credit notes, procedural

manuals.

External information

An external source of information is concerned with what is happening beyond the

boundaries of the organization. This covers any documentation relating to a subject area

produced as a summary or detailed report by an agency external to an organization.

Such information may be obtainable from government agencies or private information

providers. Examples might include:

• Census figures

• Telephone directories

• Judgments on court cases

• Computer users’ yearbook

• Legislation, for example

• Gallup polls the data protection act

• National opinion polls

• Trade journals

• Ordnance survey maps

• Professional publications

• Financial services agencies such

• Industry standards as dunn and bradstreet

• The internet

Characteristics of Information

Availability/accessibility

Information should be easy to obtain or access. Information kept in a book of some kindis only available and easy to access if you have the book to hand. A good example of

availability is a telephone directory, as every home has one for its local area. It is

probably the first place you look for a local number. But nobody keeps the whole

country’s telephone books so for numbers further afield you probably phone a directory

enquiry number. For business premises, say for a hotel in London, you would probably

use the Internet.

Accuracy

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Information needs to be accurate enough for the use to which it is going to be put. To

obtain information that is 100% accurate is usually unrealistic as it is likely to be too

expensive to produce on time. The degree of accuracy depends upon the

circumstances. At operational levels information may need to be accurate to the nearest

penny – on a supermarket till receipt, for example. At tactical level department heads

may see weekly summaries correct to the nearest £100, whereas at strategic level

directors may look at comparing stores’ performances over several months to the nearest

£100,000 per month.

Accuracy is important. As an example, if government statistics based on the last census

wrongly show an increase in births within an area, plans may be made to build schools

and construction companies may invest in new housing developments. In these cases

any investment may not be recouped.

Reliability or objectivity

Reliability deals with the truth of information or the objectivity with which it is

presented. You can only really use information confidently if you are sure of itsreliability and objectivity.

Relevance/appropriateness

Information should be relevant to the purpose for which it is required. It must be

suitable. What is relevant for one manager may not be relevant for another. The user

will become frustrated if information contains data irrelevant to the task in hand.

Completeness

Information should contain all the details required by the user. Otherwise, it may not be

useful as the basis for making a decision. For example, if an organization is supplied with information regarding the costs of supplying a fleet of cars for the sales force, and

servicing and maintenance costs are not included, then a costing based on the

information supplied will be considerably underestimated.

Level of detail/conciseness

Information should be in a form that is short enough to allow for its examination and

use. There should be no extraneous information. For example, it is very common

practice to summarize financial data and present this information, both in the form of

figures and by using a chart or graph. We would say that the graph is more concise

than the tables of figures as there is little or no extraneous information in the graph or

chart. Clearly there is a trade-off between level of detail and conciseness.

Presentation

The presentation of information is important to the user. Information can be more easily

assimilated if it is aesthetically pleasing. For example, a marketing report that includes

graphs of statistics will be more concise as well as more aesthetically pleasing to the

users within the organization. Many organizations use presentation software and show

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summary information via a data projector. These presentations have usually been well

thought out to be visually attractive and to convey the correct amount of detail.

Timing

Information must be on time for the purpose for which it is required. Information

received too late will be irrelevant. For example, if you receive a brochure from a theatre

and notice there was a concert by your favorite band yesterday, then the information is

too late to be of use.

Value of information

The relative importance of information for decision-making can increase or decrease its

value to an organization. For example, an organization requires information on a

competitor’s performance that is critical to their own decision on whether to invest in

new machinery for their factory. The value of this information would be high. Always

keep in mind that information should be available on time, within cost constraints and

be legally obtained.

Cost of information

Information should be available within set cost levels that may vary dependent on

situation. If costs are too high to obtain information an organization may decide to seek

slightly less comprehensive information elsewhere. For example, an organization wants

to commission a market survey on a new product. The survey could cost more than the

forecast initial profit from the product. In that situation, the organization would

probably decide that a less costly source of information should be used, even if it may

give inferior information.

Presentation of Information Written

The vast majority of information created within an organization is in the written form.

This can include hand-written or word processed information and information in e-mails

as well as reports produced from different classes of software, both general-purpose

packages and bespoke software solutions. Examples of written information are reports

memos and tables, receipts, invoices, statements, and summary accounting

information. The list is almost endless and different businesses will produce their own

type of written information.

Aural

Another common form of information is aural, which is information presented as sound.

The commonest form of aural information is of course speech and examples of this

would be formal meetings (where minutes are taken), informal meetings, talking on the

phone and voice-mail messages. Nowadays many organizations will have employees

giving a presentation or talk to a group where there may be use made of music and

sound effects as well as speech.

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Visual

This form of information includes when pictures, charts and graphs are used to

communicate information. Again, many presentations will make use of data projectors

and presentation software that will include text, graphics and animations. Full video

can also be projected via a data projector, and presentations can use video filmed with a

digital video camera and then edited on a computer and distributed via CD or DVD now

that DVD writers are quite common.

Role of information

Planning

Planning is the process of deciding, in advance, what has to be done and how it is to be

done. Planning should be based on good information. Planning is not an end in itself

its primary purpose is to provide the necessary structure for decision-making and

resulting actions, throughout the organization. The process of planning provides an

opportunity to construct a sequence of actions that, when executed, will achieve the

required aims and objectives.

Control

Control can be defined as the monitoring and evaluation of current progress against the

steps of a pre-defined plan or standard. If these tasks are not proceeding in line with

expectations then action is taken to bring the project back in line with what had been

planned. Control is carried out at strategic, tactical and operational levels. The type of

control changes according to the level of management as does the amount of time spent

on control.

Decision-making

Decision-making is the process of selecting an action or actions from those possible

based on the information available. Decision making involves determining and

examining the available actions and then selecting the most appropriate actions in order

to achieve the required results.

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Chapter Four

The systems concepts

Introduction

A system has been defined as an assembly of procedures, process, methods, routines or

techniques united by some form of regulated interaction to form of organized whole. A

system is a set of items, equipments, processes and / or people working jointly with an

aim of achieving common goals.

A system is a set of interacting components that work together to accomplish specific

goals. For example, a business is organized to accomplish a set of specific functions. Any

situations, which involve the handling or manipulation of materials or resources of any

kind whether human, financial or informative, may be structured and represented in the

form of a system.

Examples of systems are:

• Education systems

•

Transport systems• Business systems

• Health systems

Components of systems

Business system accepts inputs, manipulates them and produces results intermediate

results or data may be stored. The control of the system modules is to be affected for

optimum operation.

• Input-Data to be processed into information must first be collected and

communicated from the external environment into the system by the input

function. The nature of input is influenced by the nature of the system.

• Process- After data is collected and prepared into a medium suitable for input; it

is then ready for processing function, in which the input raw data is manipulated

into information using the input procedures or instructions.

• Output- This is the final data processing function of the system. It involves the

communication of the derived information after processing. This information is

usually in form of business documents e.g. invoices.

STORE

PROCESS

CONTROL

OUTPUTINPUT

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• Storage- This forms the major component of the data processing system. The

stored data forms the basis for the information systems. The stored data and or

information are an important base which supports all data processing systems.

• System control- Includes the feedback concept that furnishes expressive

information on the input processing, storage, and output functions of the system.

Importance of systems study• It provides a theoretical framework which allows performance of a system to be

monitored.

• It stresses that all systems must work in harmony in order to achieve the overall

goals of a system.

• It recognizes the fact that conflicts can arise in any system leading to sub-

optimization thus making the system not achieve its goals.

• It allows an individual to recognize that he a sub-system within a big system.

• The design of a system must support the goals of the total system.

Characteristics of a system

• Purpose – Systems exist to fulfill some objective or satisfy a need. A system may

accomplish more than one task. The purpose of a system is closely tied to its

rationale.

• Rationale – This is the justification for a system’s existence.

• Efficiency – This is how well a system utilizes its resources, that is, doing things

right.

• Effectiveness – How well a system fulfils its purpose, assuming that its purpose

is the right one. Involves a system doing the right things.

• Inputs – Entities that enter the system to produce output or furnish information.

• Outputs – Entities that exit from the system either as interfaces or for end-user

activities. They may be used to evaluate system’s efficiency and effectiveness.

• Transformation rules – Specify how the input is processed to produce output.

• Throughput – Measures the quantity of work a system accomplishes. Does not

consider the quality of the output.

• Boundary – Artificially delimits a system for study or discussion purposes.

System designers can only control those system components within the boundary.

• Environment – That which impacts the system but is outside the system’s

boundary. The system cannot control events in the environment.

• Interfaces – Points where two systems meet and share inputs and outputs.

Interfaces belong to the environment although they may be inside the system

boundary.

• Feedback – Recycles outputs as subsequent inputs, or measures outputs to

assess effectiveness.

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Classification of systems

Physical systems Vs Abstract systems

• A physical system consists of a set of elements, which are coordinated and

operate as a whole entity to achieve a certain objective. This system may also be

called a concrete system.

• An abstract system is an orderly arrangement of conceptual items or components.

Simple systems Vs Complex systems

• A simple system has few components, and the relationship or interaction between

elements is uncomplicated and straightforward.

• A complex system has many elements that are highly related and interconnected.

Open systems Vs Closed systems

• An open system interacts with its environment. It is a system with a feedback

mechanism that promotes the free exchange of information between the systemand the external entities. Organizations are open systems.

• A closed system has no interaction with the environment. This is a system that

neither transmits information to the outside world nor receives any information

from the outside world. It is mainly a scientific concept (e.g. physics experiments).

Open loop systems Vs closed loop systems

• An open-loop system is a system, which does not act in a controlled manner, that

is, there is no feedback loop, and so no measure of performance against

standards.

• A closed-loop system is a system that functions in a controlled manner; such asystem accepts inputs, works upon them according to some predefined processing

rules and produces outputs. Such a system is controlled via a feedback loop.

Stable/Static systems Vs Dynamic systems

• A stable system undergoes very little change over time.

• A dynamic system undergoes rapid and constant change over time.

Adaptive systems Vs Non-adaptive systems

• An adaptive system is able to change in response to changes in the environment.

These systems can also be described as cybernetic or self-organizing systems.

• A non-adaptive system is not able to change in response to changes in the

environment.

Deterministic systems Vs Probabilistic systems

• Deterministic systems operate in a predictable manner. For example, thermostats

and computer programs.

• In probabilistic systems however, it is not possible to determine the next state of

the system. These systems depend on probability distribution.

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Permanent systems Vs Temporary systems

• A permanent system exists for a relatively long period of time.

• A temporary system exists for only a relatively short period of time.

System change-over

Involves changing or switching from existing system to the new developed system. The

following methods may be used:

Direct changeover

• It involves the immediate change to the new system on a chosen date

• On the date the old system is abandoned and a new system takes over

immediately

• It involves minimal transition cost

• If the new system fails the old system will not be available as a back up

The advantages of a direct changeover are:

• Relatively cheap• Prevents the weaknesses of the old system from being passed over to the new

system

• Reduces system implementation duration

Its disadvantages are:

• It is very risky especially if the new system fails. The cost of switching back to the

old system will be high

• If not properly planned, it may interrupt user organization operations and bring

confusion amongst staff members

Parallel changeover

• It involves both the new and old systems working together at the same time for a

period of time

• The user compares the two systems and obtains clear understanding of the

difference between the two systems

• If there are any problems with the new system they are solved before the old

system is discontinued

• However the conversion results to addition of workload for the users and hence

may results in confusion about which system has the correct data

Its advantages are:

• Users become familiar with the new system prior to the actual changeover which

may enhance their efficiency

• The organization is exposed to less risks in case the new system fails

• There would be less interruption and inconveniences in the organization

operations during the changeover period.

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The disadvantages of this method are:

• It is an expensive method

• It might delay system implementation schedule or period

Phased changeover

• It involves gradual implementation of the new system

• positive operations of the new system are implemented while the remaining

operations are completed by the old system

• When the operation of the new system is successful, another operation is

implemented until the new system is fully operational

• It is confusing because some users use the old system while other use the new

system

Pilot changeover

• It involves installation of new system but using it only in one part of the

organization on an experimental basis. E.g. a bank wishing to computerize its

operations may install a computerized system on one branch on experimental

basis.

• When the system is proved to be successful, it is transferred to another branch

and after some time to another etc until the entire bank is computerized.

• Any refinement that ought to be done on the system should be done before it is

installed in the next branch.

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REINFORCING QUESTIONS

Question One

(i) Define the following terms with regard to the study of systems.

(a)System

(b)System theory

(c)Closed loop system [6 marks]

(ii) Describe with the aid of a diagram the components of a closed loop system.

[14 marks]

Question Two

(i) Define the following terms:

a)Entropy

b)Factoring

c)Equifinality

d)Sub-optimality

e)Synergy [10 Marks]

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(ii) List the properties that are characteristic of all systems. [10 marks]

Question Three

i. Describe the three management levels in organizations; discuss their various

informational needs and responsibilities. Give examples. [12 Marks]

ii. Organizational theory is the body of knowledge relating to the philosophical basis

of the structure, functioning and performance of organizations. Such theory is

derived from historical schools of thought stating the point of view of a number of

early pioneers of management. Briefly describe four of these schools of thought.

[8 Marks]

Question Four

i. Why is the study of systems theory and control systems useful? [10 Marks]

ii. A system may be coupled to varying degrees for various reasons. What is coupling

in a system? What do you understand by the terms tightly coupled systems,

loosely coupled systems and decoupling a system? [8 Marks]

iii. Differentiate between an open system and a closed system. [2 Marks]

Question Five

i. What is a control system? Describe the basic elements of a control system.

[10 marks]

ii. Describe the various components of a system. [10 marks]

Question six

a.An open field setting restaurant serves several delicious local dishes to customers

who go for lunch. The restaurant has a kitchen that provides the meals. There are waiters who take orders from customers who after selecting their seats, place orders

for their meals. The waiters supply the meals that are then taken to the customers

On completion, the customers are billed and if necessary they pay the cashier. In

each case the cashier issues payment receipts for every payment transaction.

i. Would you classify the restaurant as a system? Justify your answer using

illustrations from the given case [4 marks]

ii. Distinguish between closed system and open system [3 marks]

iii. What is system maintenance? At what stage is the systems development life cycle

does it start? [3marks]

b.The company you work for has decided to replace its inventory control system. Thecurrent system was implemented ten years ago but has restricted reporting facilities

and has a text-base interface. As the project manager, you are now considering

details of implementation. You have been advised that you should consider both

“parallel running” and “direct changeover”

i. briefly explain what is meant by the terms “parallel running” and “direct

changeover” [4marks]

ii. Identify two main risks of direct change over and suggest how these risks

might be reduced for inventory control system implementation [6 marks]

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Proposed Answers

Question One

(i)

a)A system is a set of interacting components working together to achieve certain

goals. Systems accept inputs, work upon them according to some predefined

processing rules, and produces outputs.

b)Systems theory is the body of knowledge which allows systems to be studied, so

that the behaviour of complex systems can be explained and, in certain

circumstances, predicted.

c)So that a system can function in a controlled manner, there must be feedback.

This means that, after processing has taken place, the results of that processing

are fed back to an element of the system which is able to influence its behaviour,

so that corrective action can be taken. Examples of systems which employ the

principle of feedback are a heating system which uses a thermostat and an engine

which is controlled by a governor. These are known as closed loop systems.

(ii)

• Input-Data to be processed into information must first be collected and

communicated from the external environment into the system by the inputfunction. The nature of input is influenced by the nature of the system.

• Process- After data is collected and prepared into a medium suitable for input; it

is then ready for processing function, in which the input raw data is manipulated

into information using the input procedures or instructions.

• Output- This is the final data processing function of the system. It involves the

communication of the derived information after processing. This information is

usually in form of business documents e.g. invoices.

STORE

PROCESS

CONTROL

OUTPUTINPUT

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• Storage- This forms the major component of the data processing system. The

stored data forms the basis for the information systems. The stored data and or

information are an important base which supports all data processing systems.

• System control- Includes the feedback concept that furnishes expressive

information on the input processing, storage, and output functions of the system.

Question Two

(i)

a)Entropy – The tendency towards disorder (chaos) in a system. The more closed a

system is, the greater the entropy.

b)Factoring is the process of disintegrating a system into subsystems as a means of

focusing on special systems requirements.

c)Equifinality is the recognition that systems can achieve their objectives in a

variety of ways using varying inputs, processes and methods.

d)Sub-optimality arises where systems pursue their own goals or objectives which

may be detrimental to the overall system’s goals.e)Synergy means that the whole is more effective than the sum of the individual

parts.

(ii)

a)Purpose – Systems exist to fulfill some objective or satisfy a need. A system may

accomplish more than one task. The purpose of a system is closely tied to its

rationale.

b)Rationale – This is the justification for a system’s existence.

c)Efficiency – This is how well a system utilizes its resources, that is, doing thingsright.

d)Effectiveness – How well a system fulfils its purpose, assuming that its purpose is

the right one. Involves a system doing the right things.

e)Inputs – Entities that enter the system to produce output or furnish information.

f)Outputs – Entities that exit from the system either as interfaces or for end-user

activities. They may be used to evaluate system’s efficiency and effectiveness.

g)Transformation rules – Specify how the input is processed to produce output.

h)Throughput – Measures the quantity of work a system accomplishes. Does not

consider the quality of the output.

i)Boundary – Artificially delimits a system for study or discussion purposes.

System designers can only control those system components within the boundary.

j)Environment – That which impacts the system but is outside the system’s

boundary. The system cannot control events in the environment.

k)Interfaces – Points where two systems meet and share inputs and outputs.

Interfaces belong to the environment although they may be inside the system

boundary.

l)Subsystems – systems are made up of sub-units

m)Differentiation – specialized units perform specialized functions

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Question Three(i)

Supervisors/Lower level of management

a)Supervisors manage and monitor the employees or workers.

b)They are responsible for day-to-day operational matters.

c)An example of a supervisor’s responsibility would be to monitor workers andmaterials needed to build a product.

d)Supervisors get information from middle managers above them and workers below

them (primarily vertical).

e)They need internal information for operational planning.

f)They need detailed, current day-to-day information.

g)An example of a supervisor need for information is listings of current supplies,

current inventory, and production output.

Middle Management

a)Middle managers deal with control planning, tactical planning, and decision-

making.

b)They implement long-term goals of the organization.

c)An example of a middle manager’s responsibility would be to set sales goals for

several states.

d)Middle-level managers get information from among all departments (horizontally)

and from all levels of management (vertically).

e)They need historical, internal information for tactical planning.

f)They need summarized information such as weekly or monthly reports.

g)An example of a middle-level manager information need would be to developproduction goals with concurrent information from top-level managers and

supervisors.

Top Management

a)Top managers are concerned with long-range strategic planning.

b)They need information to help them plan for future growth and direction of the

organization.

c)An example of a top manager’s responsibility would be to determine the demand

for current products and the sales strategies for new products.d)Top-level managers get information from outside the organization and from all

departments (horizontally and vertically).

e)They need future-oriented internal and external information for strategic

planning.

f)They need information that reveals the overall condition of the business in

capsule form.

(ii)

a)Scientific management

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a.Developed by F. W. Taylor who sought to develop ways of increasing

productivity by making work easier to perform and methods for motivating

the workers to take advantage of labour-saving devices.

b.Max Weber wrote of machine-like or bureaucratic structures where

activities were formalized by rules, job descriptions and training.

b)Administrative management

a.Henri Fayol identified five universal management functions: planning,

organizing, commanding, coordinating and controlling.

b.Fayol also developed 14 principles of management as guides to managerial

action.

c.Identified the functions in organization e.g. accounts, production,

management, sales

c)Human relations

a.The experiments conducted by Elton Mayo at Hawthorne plant of the

Western Electricity Company in the USA revealed that an organization was

more than a formal structure or arrangement of functions.

b.The results of his research focused attention on the behavioural approachto management and he concluded that ‘an organization is a social system, a

system of cliques, grapevines, informal status system, rituals and a mixture

of logical, non logical and illogical behaviour’.

c.Came up with non-financial means of motivation e.g. job satisfaction

d)Systems approach

a.Sees the organization as a total system of interconnected and interacting

subsystems, all mutually dependent working towards a common goal.

b.Major contributors include Trist, Bamforth, Crozier, Galbraith and Likert.

e)Contingency theory

a.Sees each organization as a unique system resulting from an interaction of

the subsystems with the environment.

Question Four

(i)

A study of control systems and systems theory is useful because:

a)It provides a theoretical framework which allows the performance of a business to

be studied.

b)It stresses the fact that all organizations are made up of subsystems which must work together harmoniously in order that goals of the overall system can be

achieved.

c)It recognizes the fact that conflicts can arise within a system, and that such

conflicts can lead to sub-optimization and that, ultimately, can even mean that an

organization does not achieve its goals.

d)It allows the individual to recognize that he/she is a subsystem within a larger

system, and that the considerations of systems concept apply to him/her, also.

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e)Given the above factors, it is clear that information-producing systems must be

designed to support the goals of the total system, and that this must be borne in

mind throughout their development.

(ii)

a)Coupling- Coupling occurs when two systems are highly interrelated and

dependent on each other to perform their functions.

b)Tightly coupled systems- These systems are over-integrated and over rely on one

another in order to function. Failure of one component means total failure of all

the others.

c)Loosely coupled systems - These systems are integrated and rely on each other

but exhibit a degree of autonomy of operations performance.

d)Decoupling- Decoupling is the process of loosening the connection between two

tightly connected systems or subsystems so that they can operate with some

degree of independence. This allows the subsystems to pursue their own

objectives. In addition, it enhances flexibility in the system. Once the system has

been decoupled, it is possible for them to plan and control their operations. Thisis a process in which the subsystems are given autonomy and independence. The

subsystems operate independently thereby pursuing their own objectives and

enhancing flexibility. When systems are decoupled it is easier to administer them

in some cases as they become less complex and more flexible.

(iii)

Open systems are those systems which interact with their environment either for the

collection of information on which to base strategy, or for conducting business

transactions with suppliers, customers, general public, government departments, trade

organizations etc. Such systems adapt to changes in the environment in order to

survive, which requires speedy reactions to competitive situations and other threats in

the most effective way. Open systems include man, biological and business systems.

Closed systems do not interact with their environment either for the exchange of

information or business transactions. Such systems are self-contained. Business

systems do not conform to this category as they interact with their environment to a

greater degree as no business exists in a vacuum. Example is a controlled laboratory

experiment.

Question Five

(i) A control system may be defined as a ‘control loop’ superimposed on another system

having a different purpose, e.g. the production system, which is controlled by the

production control system. Control is for the purpose of detecting variations in the

behaviour of a system so that control signals can be communicated to the appropriate

manager. He is then in a position to effect changes to the system he is managing, so

that it reverts to the desired state and so achieve its objectives. If the variations are

negative, he may increase or encourage the variation for positive variations.

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The basis of control in business systems consists of the following elements:

• Planning (setting standards): the determination of objectives, or parameters;

standard time for an operation, level of production activity required, level of sales

required, expenditure allowed, and performance levels required.

• Collecting facts (measurement): the collection and recording of data in respect of:

actual time taken level of production achieved level of sales achieved, expenditure

incurred, actual performance level etc.

• Comparison: the comparison of objectives with actual results for the purpose of

indicating variances from planned performance in the various spheres of

business operations, and informing the relevant manager of significant deviations

(variances).

• Corrective action: action is taken by the relevant manager (effector) to maintain a

state of homeostasis or to revise plans.

(ii)

a)Inputs- These provide the system with what it needs to operate. It may include

machines, manpower, raw materials, money or time.

b)Processes- Include policies, procedures, and operations that convert inputs intooutputs.

c)Outputs- These are the results of processing and may include information in the

right format, conveyed at the right time and place, to the right person.

d)Systems Boundary-A system boundary defines the system and distinguishes it

from its environment.

e)Subsystems- A subsystem is a unit within a system that shares some or all of the

characteristics of that system. Subsystems are smaller systems that make up a

super-system / supra-system. All systems are part of larger systems.

f)Environment- The environment is the world surrounding the system, which the

system is a subsystem of.

Question Six

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Chapter Five

Systems Development Life Cycle

System life cycle is an organizational process of developing and maintaining systems. It

helps in establishing a system project plan, because it gives overall list of processes andsub-processes required developing a system. One or more of the following situations will

initiate an individual application or project:

a.A new opportunity that relates to a new or existing business process.

b.A problem that relates to an actual business process.

c.A new opportunity that will enable the organization to take advantage of

technology.

d.A problem with the current technology.

e.Organizational growth

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f.Merger or acquisition

g.Revisions in government regulations

System development projects should be initiated using well-defined procedures to

communicate business needs to management. These procedures often require detailed

documentation identifying the need or problem, specifying the desired solution and

relating the potential benefits to the organization.

Aids in system analysis and design include:

a.Methodologies – Comprehensive, multi-step approaches to systems development

that guides the work and influences the quality of the final product.

b. Techniques – Particular processes that an analyst will follow to ensure that the

work is well thought-out, complete and comprehensible to others on the project

team.

c. Tools – Computer programs that make it easy to use and benefit from the

techniques and to faithfully follow the guidelines of the overall developmentmethodology.

System development life cycle means combination of various activities. In other words we

can say that various activities put together are referred as system development life cycle.

In the System Analysis and Design terminology, the system development life cycle means

software development life cycle.

Following are the different phases of software development cycle:

1.System study

2.Feasibility study

3.System analysis

4.System design

5.Coding

6.Testing

7.Implementation

8.Maintenance

System Study

System study is the first stage of system development life cycle. This gives a clear pictureof what actually the physical system is? It is done in two phases that is; the preliminary

survey of the system is done which helps in identifying the scope of the system. The

second phase of the system study is more detailed and in-depth study in which the

identification of user’s requirement and the limitations and problems of the present

system are studied. After completing the system study, a system proposal is prepared by

the System Analyst (who studies the system) and placed before the user. The proposed

system contains the findings of the present system and recommendations to overcome

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the limitations and problems of the present system in the light of the user’s

requirements.

Objectives of the System study

a.To understand organizational characteristics and its objectives

b.To understand organizational structure

c.To identify organizational mission and collect relevant data or document regarding

organizational information.

d.To develop a brief and accurate problems statement usually known as system

term of reference (TOR).

Terms of reference

It is a documentation prepared by steering committee to act as a reference document

throughout system development stages. Its contents include:

a.Project title

b.Subject of study

c.Purpose of studyd.Personnel

e.Departments

f.Sections affected or involved during the system implementation

g.Available resources and constraints, the analyst, the project leader should

consider

h.The projects estimated duration and schedule

The importance of terms of reference

a.Provides information about the proposed system b.It may act as a reference document throughout the system development process

c.It acts as an authorization document to the project development team by the

management

d.It gives the scope and extent of the proposed system project, thus setting out

systems limitation and capability

e.It sets out the objectives of the proposed system

Steering committee

It is formed by two or three people to oversee the system development project from its

initiation to its completion. It comprises of the system analyst as the project leader and

a representative of the user department. They should understand all the processing

objectives and procedures within the affected department. A management

representative and accountant or auditors may be incorporated to advise initially on

financial aspects on the project.

Functions of the steering committee

a.To study the current processing procedures that may require to be improved.

b.To prepare problem statement in form of terms of reference.

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c.To coordinate system development activities throughout the development life

cycle.

d.To interface the project development team with organizational management.

e.To resolve conflict that may arise during system development.

f.To direct, control and monitor the system development progress.

Feasibility Study

This is a more detailed study carried out by a feasibility study team. Its purpose is to

define the problem and decide whether or not a new system to replace the existing one

is viable or feasible. During the study, the analyst should assess the magnitude of the

problem and attempt to restrict or at least identify the scope of the project. The analyst

must list precisely the problems of the current system and also indicate what would be

required of the new system. He must identify alternative solutions to the problems and

recommend the most cost effective solution.

Activities of Feasibility study

a.Identification of main characteristics of the existing system

b.Determination of the main output requirements

c.Considerations of alternative ways of meeting similar requirements.

d.Preparation of gross estimates of developments, implementation and operation

costs for each probable alternative solution.

e.Documentation of the study i.e. writing of feasibility study report.

f.Preparation of gross estimates of possible direct and indirect benefits for each

probable alternative.

Types of Feasibility Study

Economic feasibilityEconomic feasibility is aimed at determination of whether or not to continue with the

project, depending on whether the project is economically viable. The systems benefits

and estimated implementation cost should be determined before any further resources

can be spent on the project. A cost benefit analysis (CBA) is carried out to determine

whether the new system is economically viable.

Cost Benefit Analysis

1.Benefit Analysis: Is obtained through comparison of the new system and the

existing system. Benefits of the new system fall under two categories i.e. direct andindirect benefits as well as tangible and intangible benefits.

i. Direct (Tangible)

a.Measurable benefits are those that can be quantified in monetary terms e.g.

increase in working capital as a result of purchasing of computer systems or

reduction of delays in decision making which is obtained through improved

procedures e.g. invoicing procedures and credit control procedures.

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b.Direct savings are those costs, reduced or eliminated as a result of

introduction of computerized system. They include reduction or elimination of

clerical personnel and elimination of some specific costs e.g. stationery costs.

Like measurable benefits direct savings can be quantified in monetary terms.

ii. Intangible benefits – they are benefits that cannot be quantified in monetary

terms or those that are difficult or impossible to quantify in monetary terms.

They are clearly desirable but very difficult to evaluate in terms of money valuee.g. improved customer satisfaction, better information, improved organizational

image, increased staff morale, a competitive advantage to an organization etc.

2. Cost Analysis: Costs are expenses or expenditure which is incurred by a

system. These may include equipment cost, development cost, operation cost and

software cost. During cost analysis one should consider both the new and the

existing system. The cost of retaining and operating the existing system should be

compared to the cost of introducing and running the computerized information

system.

i. The cost of running the existing system. This is calculated from the past

records. The items to consider include:

a.Man power cost – which is extracted from the budgets and payroll reports

b.Material cost – which includes consumables e.g. stationery, work in progress

and current stock

c.Operational cost e.g. the equipment cost expressed in terms of unit rate.

Others to consider include the duration the project takes to be completed

and initial replacement cost.

d.Overhead costs – which are direct expenses incurred by the company on behalf of all departments e.g. rent, electricity, telephone bill etc. These can

easily be extracted from departments or centres to which they are allocated.

e.The intangible cost of existing system e.g. loss of sales or cost of sales as a

result of inappropriate stock levels or loss of interest in bank as a result of

improper credit control system.

ii. The cost of operating the proposed system – this is likely to include all the

areas covered above i.e. manpower, materials, overheads and the intangible

costs. However there are additional costs associated with computerized

systems e.g. service contracts for the computer system, insurance of thecomputer system, cost of data transmission, cost of consumables like printer

cartridges, ribbons etc. All these costs should be evaluated or estimated as

accurately as possible.

iii. The cost of new system development – Includes the cost incurred for any

consultancy services that may have been hired during development.

Allowances given to the system development team members fall under this

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category. Overall effects of the system development and implementation should

be determined and any cost associated established. These estimates are based

on both time and activities involved in the project. Staff training cost,

recruitment costs and retrenchment costs should be considered under system

development cost.

Legal feasibility

Determines whether the proposed system conflicts with legal requirements, e.g. a data

processing system must comply with the local Data Protection Acts.

Operational feasibility

Operational feasibility is a measure of how well a proposed system solves the problems,

and takes advantage of the opportunities identified during scope definition and how it

satisfies the requirements identified in the requirements analysis phase of system

development.

Schedule feasibility

A project will fail if it takes too long to be completed before it is useful. Typically this

means estimating how long the system will take to develop, and if it can be completed in

a given time period using some methods like payback period. Schedule feasibility is a

measure of how reasonable the project timetable is. Given our technical expertise, are

the project deadlines reasonable? Some projects are initiated with specific deadlines.

You need to determine whether the deadlines are mandatory or desirable.

System Analysis

Assuming that a new system is to be developed, the next phase is system analysis. Analysis involved a detailed study of the current system, leading to specifications of a

new system. Analysis is a detailed study of various operations performed by a system

and their relationships within and outside the system. During analysis, data are

collected on the available files, decision points and transactions handled by the present

system. Interviews, on-site observation and questionnaire are the tools used for system

analysis. Using the following steps it becomes easy to draw the exact boundary of the

new system under consideration:

• Keeping in view the problems and new requirements

• Workout the pros and cons including new areas of the system

All procedures, requirements must be analyzed and documented in the form of detailed

data flow diagrams (DFDs), data dictionary, logical data structures and miniature

specifications. System Analysis also includes sub-dividing of complex process involving

the entire system, identification of data store and manual processes.

The main points to be discussed in system analysis are:

• Specification of what the new system is to accomplish based on the user

requirements.

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• Functional hierarchy showing the functions to be performed by the new system

and their relationship with each other.

• Function network which are similar to function hierarchy but they highlight the

functions which are common to more than one procedure.

• List of attributes of the entities - these are the data items which need to be held

about each entity (record)

System Design

Based on the user requirements and the detailed analysis of a new system, the new

system must be designed. This is the phase of system designing. It is a most crucial

phase in the development of a system. Normally, the design proceeds in two stages:

• preliminary or general design

• Structure or detailed design

Preliminary or general design: In the preliminary or general design, the features of the

new system are specified. The costs of implementing these features and the benefits to

be derived are estimated. If the project is still considered to be feasible, we move to thedetailed design stage.

Structure or Detailed design: In the detailed design stage, computer oriented work

begins in earnest. At this stage, the design of the system becomes more structured.

Structure design is a blue print of a computer system solution to a given problem having

the same components and inter-relationship among the same components as the

original problem. Input, output and processing specifications are drawn up in detail. In

the design stage, the programming language and the platform in which the new system

will run are also decided.

There are several tools and techniques used for designing. These tools and techniques

are:

• Flowchart

• Data flow diagram (DFDs)

• Data dictionary

• Structured English

• Decision table

• Decision tree

Each of the above tools for designing will be discussed in detailed in the next lesson.

Coding

After designing the new system, the whole system is required to be converted into

Computer understanding language. Coding the new system into computer programming

language does this. It is an important stage where the defined procedures are

transformed into control specifications by the help of a computer language. This is also

called the programming phase in which the programmer converts the program

specifications into computer instructions, which we refer as programs. The programs

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coordinate the data movements and control the entire process in a system. It is generally

felt that the programs must be modular in nature. This helps in fast development,

maintenance and future change, if required.

Testing

Before actually implementing the new system into operations, a test run of the system is

done removing all the bugs, if any. It is an important phase of a successful system. After

codifying the whole programs of the system, a test plan should be developed and run on

a given set of test data. The output of the test run should match the expected results.

Using the test data following test run are carried out:

• Unit test

• System test

Unit test: When the programs have been coded and compiled and brought to working

conditions, they must be individually tested with the prepared test data. Any

undesirable

happening must be noted and debugged (error corrections).

System Test: After carrying out the unit test for each of the programs of the system and

when errors are removed, then system test is done. At this stage the test is done on

actual data. The complete system is executed on the actual data. At each stage of the

execution, the results or output of the system is analyzed. During the result analysis, it

may be found that the outputs are not matching the expected out of the system. In such

case, the errors in the particular programs are identified and are fixed and further

tested for the expected output.

When it is ensured that the system is running error-free, the users are called with their

own actual data so that the system could be shown running as per their requirements.

Implementation

After having the user acceptance of the new system developed, the implementation

phase begins. Implementation is the stage of a project during which theory is turned

into practice. During this phase, all the programs of the system are loaded onto the

user's computer. After loading the system, training of the users starts. Main topics of

such type of training are:

• How to execute the package

•

How to enter the data• How to process the data (processing details)

• How to take out the reports

After the users are trained about the computerized system, manual working has to

shift from manual to computerized working. The following two strategies are followed

for running the system:

i. Parallel run: In such run for a certain defined period, both the systems i.e.

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Computerized and manual are executed in parallel. This strategy is helpful

because of the following:

• Manual results can be compared with the results of the computerized

system.

• Failure of the computerized system at the early stage, does not affect the

working of the organization, because the manual system continues to

work, as it used to do.

ii. Pilot run: In this type of run, the new system is installed in parts. Some part of

the new system is installed first and executed successfully for considerable time

period. When the results are found satisfactory then only other parts are

implemented. This strategy builds the confidence and the errors are traced easily.

Maintenance

Maintenance is necessary to eliminate errors in the system during its working life and to

tune the system to any variations in its working environment. It has been seen that

there are always some errors found in the system that must be noted and corrected. Italso means the review of the system from time to time. The review of the system is done

for:

• knowing the full capabilities of the system

• knowing the required changes or the additional requirements

• studying the performance

Prototyping

Prototyping is the process of building a model of a system. In terms of an information

system, prototypes are employed to help system designers build an information systemthat intuitive and easy to manipulate for end users. Prototyping is an iterative process

that is part of theanalysis phaseof thesystems development life cycle.

Advantages of Prototyping

• Reduces development time

• Reduces development costs

• Requires user involvement

• Developers receive quantifiable user feedback

• Facilitates system implementation since users know what to expect

• Results in higher user satisfaction

• Exposes developers to potential future system enhancements

Disadvantages of Prototyping

• Can lead to insufficient analysis.

• Users expect the performance of the ultimate system to be the same as the

prototype.

• Developers can become too attached to their prototypes

http://www.colorado.edu/infs/jcb/class/analysis.html

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• Can cause systems to be left unfinished and/or implemented before they are

ready.

• Sometimes leads to incomplete documentation.

• If sophisticated software prototypes (4th GL or CASE Tools) are employed,

the time saving benefit of prototyping can be lost.

Types of prototyping

Throwaway prototyping / close-ended prototyping.

Throwaway or Rapid Prototyping refers to the creation of a model that will eventually be

discarded rather than becoming part of the final delivered software. After

preliminary requirements gathering is accomplished, a simple working model of

the system is constructed to visually show the users what their requirements may

look like when they are implemented into a finished system.

Evolutionary prototyping

Evolutionary Prototyping (also known as breadboard prototyping) is quite different from Throwaway Prototyping. The main goal when using Evolutionary Prototyping is to build a

very robust prototype in a structured manner and constantly refine it. "The reason for

this is that the Evolutionary prototype, when built, forms the heart of the new system,

and the improvements and further requirements will be built.

Incremental prototyping

The final product is built as separate prototypes. At the end the separate prototypes are

merged in an overall design.

Extreme prototyping

Extreme Prototyping as a development process is used especially for developing web

applications. Basically, it breaks down web development into three phases, each one

based on the preceding one. The first phase is a static prototype that consists mainly of

HTML pages. In the second phase, the screens are programmed and fully functional

using a simulated services layer. In the third phase the services are implemented. The

process is called Extreme Prototyping to draw attention to the second phase of the

process, where a fully-functional UI is developed with very little regard to the services

other than their contract.

Outsourcing

Outsourcing refers to a company those contracts with another company to provide

services that might otherwise be performed by in-house employees. Many large

companies now outsource jobs such ascall center services, e-mail services, andpayroll

These jobs are handled by separate companies that specialize in each service, and are

often located overseas.

Advantages of outsourcing

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• Focus on Core Activities-In rapid growth periods, the back-office operations of a

company will expand also. This expansion may start to consume resources

(human and financial) at the expense of the core activities that have made your

company successful. Outsourcing those activities will allow refocusing on those

business activities that are important without sacrificing quality or service in the

back-office. Example: A company lands a large contract that will significantly

increase the volume of purchasing in a very short period of time; Outsource

purchasing.

• Cost and Efficiency Savings-Back-office functions that are complicated in

nature, but the size of your company are preventing you from performing it at a

consistent and reasonable cost, is another advantage of outsourcing. Example: A

small doctor's office that wants to accept a variety of insurance plans. One part-

time person could not keep up with all the different providers and rules.

Outsource to a firm specializing in medical billing.

• Reduced Overhead-Overhead costs of performing a particular back-office function

are extremely high. Consider outsourcing those functions which can be movedeasily. Example: Growth has resulted in an increased need for office space. The

current location is very expensive and there is no room to expand. Outsource

some simple operations in order to reduce the need for office space. For example,

outbound telemarketing or data entry.

• Operational Control-Operations whose costs are running out of control must be

considered for outsourcing. Departments that may have evolved over time into

uncontrolled and poorly managed areas are prime motivators for outsourcing. In

addition, an outsourcing company can bring better management skills to your

company than what would otherwise be available. Example: An information

technology department that has too many projects, not enough people and a

budget that far exceeds their contribution to the organization. A contracted

outsourcing agreement will force management to prioritize their requests and

bring control back to that area.

• Staffing Flexibility-Outsourcing will allow operations that have seasonal or

cyclical demands to bring in additional resources when you need them and release

them when you're done. Example: An accounting department that is short-handed

during tax season and auditing periods. Outsourcing these functions can providethe additional resources for a fixed period of time at a consistent cost.

• Continuity & Risk Management-Periods of high employee turnover will add

uncertainty and inconsistency to the operations. Outsourcing will provided a level

of continuity to the company while reducing the risk that a substandard level of

operation would bring to the company. Example: The human resource manager is

on an extended medical leave and the two administrative assistants leave for new

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jobs in a very short period of time. Outsourcing the human resource function

would reduce the risk and allow the company to keep operating.

• Develop Internal Staff- A large project needs to be undertaken that requires skills

that your staff does not possess. On-site outsourcing of the project will bring

people with the skills you need into your company. Your people can work alongside

of them to acquire the new skill set. Example: A company needs to embark on a

replacement/upgrade project on a variety of custom built equipment. Your

engineers do not have the skills required to design new and upgraded equipment.

Outsourcing this project and requiring the outsourced engineers to work on-site

will allow your engineers to acquire a new skill set.

Disadvantages of Outsourcing

• Loss of Managerial Control- Whether you sign a contract to have another

company perform the function of an entire department or single task, you are

turning the management and control of that function over to another company. True, you will have a contract, but the managerial control will belong to another

company. Your outsourcing company will not be driven by the same standards and

mission that drives your company. They will be driven to make a profit from the

services that they are providing to you and other businesses like yours.

• Hidden Costs- You will sign a contract with the outsourcing company that will

cover the details of the service that they will be providing. Anything not covered in

the contract will be the basis for you to pay additional charges. Additionally, you

will experience legal fees to retain a lawyer to review the contacts you will sign.

Remember, this is the outsourcing company's business. They have done this

before and they are the ones that write the contract. Therefore, you will be at a

disadvantage when negotiations start.

• Threat to Security and Confidentiality- The life-blood of any business is the

information that keeps it running. If you have payroll, medical records or any

other confidential information that will be transmitted to the outsourcing

company, there is a risk that the confidentiality may be compromised. If the

outsourced function involves sharing proprietary company data or knowledge (e.g.

product drawings, formulas, etc.), this must be taken into account. Evaluate the

outsourcing company carefully to make sure your data is protected and the

contract has a penalty clause if an incident occurs.

• Quality Problems- The outsourcing company will be motivated by profit. Since the

contract will fix the price, the only way for them to increase profit will be to

decrease expenses. As long as they meet the conditions of the contract, you will

pay. In addition, you will lose the ability to rapidly respond to changes in the

business environment. The contract will be very specific and you will pay extra for

changes.

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• Tied to the Financial Well-Being of another Company-Since you will be turning

over part of the operations of your business to another company, you will now be

tied to the financial well-being of that company. It wouldn't be the first time that

an outsourcing company could go bankrupt and leave you holding-the-bag.

• Bad Publicity and Ill-Will- The word "outsourcing" brings to mind different things

to different people. If you live in a community that has an outsourcing company

and they employ your friends and neighbors, outsourcing is good. If your friendsand neighbors lost their jobs because they were shipped across the state, across

the country or across the world, outsourcing will bring bad publicity. If you

outsource part of your operations, morale may suffer in the remaining work force.

mis 1 notes

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