Chapter (6)

Developing and Implementing Effective AIS

Four stages in the Systems Development Life Cycle (SDLC )

1- Planning and Investigation : involves:
- Organizaing a systems study -Performing a preliminary investigation of the existing
system.
- developing strategic plans for the reminder of the study.
2-Analysis: involves analyzing the company’s current system to identify the information needs,
strengths, and weaknesses of the existing system.
3- Design and acquisition: involves:
- changing in organization design to eliminate or minimize the current system’s weaknesses
while preserving its strengths.
- deciding what system is best and how to acquire it.
4- Implementation, follow-up, and Maintenance: involves:
- installing resources for the new system - training the existing employees to use it.
- conducting follow up studies to determine whether the the new system is successful and
determine any new problems.

Note: a systems study looks at all systems in an organization’s application portofolio.This

portofolio may include an integrated enterprise resource planning (ERP) systems, along with
other specialized information systems such as accounting, marketing& Human resources.
- a system study means more than just replacing orr modifying existing information systems.
why organization performs system studies:
1- changes in users or business needs: such as business growth or consolidation, downsizing
operations, mergers, or new regulations can alter an organization purpose and strcture.
2- Improving business process: improving inefficient business processes such as reducing the
time of processing customer’s telephone order.
(Business process reengineering).
3-Systems integration.
1- systems Planning and initial investigation: means beginning a system study with a focused
investigation that
- Approaches specific organizational problems from abroad point of view
- uses an interdisciplinary study team to evaluate an organization’s information systems.
- Make sure the company’s study team works closely with a steering committee and end users in
all phases of the work.
Important Notes:
- when performing systems study, the participants should use a systems approach
which aligns the systems study with the organization’s mission and strategic planning goals and
objectives. Ex: If a company plans to consolidate division or stop un profitable production lines,
new IT systems need to reflect these plans.

- Steering committee: Consists of high level management, such as the controller ans systems
and user-department management. (The vice president of finance)
- The rationale for such involvement is that top management commitment is critical to the
ultimate success of new or revised system.
- They are appointed by the top management of the company.
- They should work and communicate closely with the study team ( a team of specialists).
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- Investigating current systems:
- the system study team performs a preliminary investigation of the system in question and
advises the steering committees with findings.
- The study team may consider alternatives to the current systems and estimating costs and
benefits of them.
- the duration of a preliminary investigation in brief.
- the deliverable from this phase is a preliminary investigation report to steering committee
describing the problems or objectives the study team identified.
- The steering committee may decide to
- disband the study team and nothing.
- perform additional preliminary investigations.
- proceed to the next stage of system analysis.
(2)Systems analysis: The basic purpose of the systems analysis is to examine a system in depth.
- it involves: (1) Understand the systems goals. (2) Perform a survey to acquire sufficient
information relating to current system's problems. (3) Suggest possible solutions to solve the
system’s problems through a systems analysis report.
‫ هدف هذه المرحله هو فهم اهدلف النظام والفحص الشامل ومن ثم تحديد البدائل وعمل تقرير نتائج التحليل‬.

-Understanding Organizational goals: the study team must understand the system’s goals.
- Organization goals include: (1) general systems goals. (2) Top management systems goals.
(3) Operating management systems goals.
‫ فهم اهداف المنظمه الذى يشمل المبادىء االساسيه التى يجب ان يحققها النظام واهداف االداره العليا واهداف االقسام التشغيليه‬.

(1) General systems goals: apply to most organization’s information systems.

- Principles contributing to these goals are: (1) awareness that the benefits of a new system should
exceed its costs. (2) Concern that the outputs of the system help managers make better decisions. (3)
Commitment to a system that allows optimal access to information, and (4) flexibility so that the
system can accommodate changing informational needs.
- The study team must determine whether the current system helps to achieve these general systems
goals
EX: if the current system has excessive costs associated with using traditional papers (Purchase
orders, invoices), this will violate goal number one ( Cost awareness).
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(2) Top management goals. Ais typically play key roles in satisfying top management goals.
EX: Ais usually provide top managers with long- range budget planning data so they can make
effective strategic decisions about future product-line sales.
- Periodic performance reports provide top management with vital control information about
corporate operations.
-finally, top management needs to know about the short – range operating performance of its
organization’s
sub subsystems. Ex: summary information about individual department operating results and how
these results compare with budgetary projections.
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(3) Operating management systems goals. The information needs of operating managers are
normally easier to determine because (1) the decision making functions of operating managers
typically relate to well-defined and narrower organizational areas. (2) The majority of operating
managers’ decisions are for the current business year.
- Operating managers need information that helps them make daily, weekly, or monthly operating
targets.
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-Systems Survey ( 5‫ ) فحص شامل للنظام‬the objective of systems survey is to enable the study team to
obtain a more complete understanding of the company's current operational information system and
its environment
and identifying the strengths and weaknesses of the current system.
- These weaknesses cause problems in the current system and relate to specific goals that the current
systems does not accomplish.
(1) understanding the Human Element and Potential Behavioral problems.
- There is a good chance that employees will oppose the changes that team recommends.
- Thus, a systems study must gain the ful cooperation and support of those employees who are
crucial to the success of a new system.
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(2) Data Gathering. Several ways for gathering data include:
(a) reviewing existing documentation or create new materials. Include (1) descriptive data such
as organizational charts, strategic plans, budgets, policy and procedures manuals, job descriptions,
and chart of accounts, and (2) technical documentation such as flowcharts, process maps.
(2) Observe the current system in operation. Visting various parts of the operation on a surprise
basis and asking employees questions about their jobs can help team members learn whether the
system words as described, the morale of employees, the amount of down-time, and workload cycles.
(3)use questionnaires and surveys. Open ended questionnaires: provide unstructured free –flow
of ideas that may bring new issues to light. Close-ended questionnaires : are efficient and allow for
easy tabulation of results
(4)Review internal control procedures: weaknesses in these procedures can cause major problems
for the company. The study team identifies high risk areas, strengths, and weaknesses of the specific
procedures.
(5)Interview system participants. Face to face interviews allow the study team to gather
information in the greatest depth and can sometimes reveal surprises.
-EX: an interview might reveal that manager’s decisions don’t really require input from several
existing reports.
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(3)Data Analysis: after completes survey work, the study team must analyze the results.
-Oftern, this means nothing more than creating summary statistics, but it can also involve developing
flowcharts or process maps that can highlight bottlenecks in information flows, redundant reporting.

- It takes longer than initial investigation.

- When required, the study team provides interim reports to the steering committee about its
progress.
- The most important deliverable from the analysis stage is the final system analysis report which
indicates the end of the anlaysis phase of the system study.
- the steering committee considers the report’s findings and debates the recommendations.

3-Systems design: after obtaining a positive response from the steering committee, the design team
must perform a detailed investigation of different potential systems.
1-Evaluating system feasibility: the design team determines the practicability of alternative
proposals. The design team must evaluate five feasibility areas:
a-Technical feasibility: means what technical resources are required by a particular system
- A proposed system that can interface with critical existing software is more desirable than one
requiring the organization to buy new software.
- After configuring hardware and software, the design team must determine whether current
employees have the technical skills to use it.
b- Operational feasibility: examines the systems compatibility with the current operating
environment. This means determining how consistent the tasks and procedures required by the new
system will be with those of the old system.
- the design team must also analyzes the capabilities of current employees to perform the specific
functions required by each proposed system and determine to what extent employees will require
specialized training.
- operational feasibility analysis is a human relations study because it is strongly oriented towards
"people problems"
c-Schedule feasibility: requires the design team to estimate how long it will take a new or revised
system to become operational and to communicate information to the steering committee.
d- Legal feasibility: requires a new system to comply wilth financial reporting requirements as well
as the company’s contractual obligations.
e- Economic feasibility: means making cost- benefit analysis to determine whether the costs of the
system exceed its benefits.
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2- Detailed systems design and acquisition: it begains once the steering committee approves the
feasibility of a general system project. This involves specifying the outputs, processing procedures,
and inputs for the new system.

a- Designing system outputs, processes, and inputs. When performing design tasks, the design
team should focuses on the outputs- not the input or processing requirements of the new system.
- the reason for this is that the most important objective is to satisfy the user’s needs.
- preparing output specifications first lets these requirements dictate the inputs and processing tasks
required to produce them.

b- System outputs: the design team will use the data gathered from the prior systems analysis work
to help it decide what kinds of outputs are needed as well as the formats that these output should
have.
- Output may be classified according to which functional areas uses them (marketing, accounting) as
well as how frequently they must be produced (daily or weekly).
- The system should be able to provide a specific report when requested ( a demand report or
exception report).

C-process design: after designing the outputs, the next step is to identify the processing procedures
required to produce them. This involves deciding which application programs are necessary and what
data processing tasks each program should perform.
- there are a large number of tools for modeling computer processes . they are system flowcharts ,
dataflow diagrams, program flowcharts, process maps and other documentation.
d- Designing system inputs: after specifying the outputs and processing procedures of a new project,
the next is to specify what data the system must collect to satisfy those output and processing
requirements.
- The team must identify each data element in the system design (Ex: alphabetic, maximum number
of characters, and default value) as well as specify the way the data items must be coded.
d- Prototyping: means developing a simplified model of a proposed accounting information system.
- it is experimental version of a non-existent system that a design team can develop cheaply and
quickly for user- evaluation purposes. Prototyping has four steps

-advantages of prototyping are: 1- it is useful when end users do not understand their informational
needs very well, (2) system requirements are hard to define, (3) the new system is mission critical or
needed quickly, (4) past interactions have resulted in misunderstanding between end users and
designers, and (5) there are high risks associated with developing and implementing the wrong
system.
-disadvantages are: 1-both managers and IT professionals can distrust it – the managers if they
perceive that prototyping as "too experimental" and the IT professionals if they harbor fears that the
results lead to poor design solutions. (2) it is not normally appropriate for designing large or complex
information systems that serve many users with different information needs because it relies on small
portion of the users population and thus satisfies only some employees.
(3)The system specifications reports: It includes results of design team works of specifying inputs,
outputs,and processing requirements of the new system.
- some representative information in such reports includes:
(1) Historical background information about the company’s operating activities.
(2) Detailed information about the problems in the company’s current system.
(3) Detailed descriptions of the systems design proposals.
(4) Indication of what the vendors should include in their proposals to the company.
(5) Time schedule for implementing the new system.
(a)The make or buy decision. After the steering committee approves the detailed design work, it
now faces a make- or buys decision.
-make decisions: use internal IT staff to develop the system. This choice offers the tightest control
over project development. The best security over sensitive data but this choice uses valuable
employee time and can divert the organization’s resources from its main objectives EX:
manufacturing product.
- outsourcing decision: this choice is useful when the organization lacks internal expertise to do the
work.
- Canned Software: the steering committee can purchase canned software and modify it to suit the
organization’s needs.
(B) Choosing Accounting Information systems: we will assume that the steering committee
chooses to acquire most of its system resources from outside vendors.
-Request for proposal (REP): outlining the specific requirements of the desired system depending
upon the systems specifications report.it contains deadline for bidding, the length of which varies-
EX: Just afew weeks for hardware, and longer periods of time for systems requiring custom
development tasks.
- After the deadline is passed, an evaluation committee supervised by the steering committee will
review vendor submissions and schedule separate meetings with those vendors who provide system
proposals
-The vendor’s role: is to present its proposals and to answer questions from the other participants.
-The evaluation committee’s role: is to listen to the vendor proposals, ask questions, provide inputs
to the steering committee about the pros and cons of each one.
(C)Selection criteria:
1- The functionality and performance capabilities of each proposed system.
- an accounting information systems must be able to process organization’s data and provide users
with the outputs they need. EX: performance measures include response time.
2-Compatibility of each proposed system with existing systems: the new system must work with
existing
computer hardware, software, and operating procedures.
3-Vendor stability and support. Includes (1) training classes that familiarize employees with the
operating characteristics of the new system. (2) Help in implementing and testing the new system. (3)
assistance in maintaining the new system through a maintenance contract. (4) backup systems and
procedures. (5) Telephone assistance for answering user questions.
4-Costs and benefits of each proposed system. Analyzing the costs of every vendor’s proposed
system in relation to the system’s anticipated performance benefits. They will consider the difference
between purchasing and leasing the vendor’s system.
5-Maintainability of each proposed system. Maintainability means the ease with which the
systemcan be modified.
(D)Making final decision: if a company find several software packages that appear to satisfy its
needs, two methods to decide the best one. They are
(1) Point scoring analysis: Ex imcludes a point scoring analysis for an accounts payable system.

- The evaluation committee first assigns potential points to each of the selection criteria based on its
relative importance. After developing these selection criteria, the evaluation committee proceeds to
rate each vendor or package, awarding points as it deems fit. The highest point total determines the
winner.
(2) Hands-On Testing: it is potential buyers" test drive" a software package to further evaluate the
system.
- A list of tests that AIS shoppers can use for this purpose.
Bench marking testing: the new system performs a standardized data processing task (preparing
payroll). Managers then examine the outputs for accuracy, completeness, consistency, and efficiency.
-Selecting a finalist: if there is a clear winner emerges from these activities, the organization can
commence the the implementation stage.
-Outsourcing: occurs when a company hires an outside organization to handle all or part of its
operations for a specific business function.
-Types of outsourcing:
1- Business Process Outsourcing (BPO). Means contracting with outside firms to perform such
normal tasks as preparing payrolls. The annual costs depend on the amount of processing work.
2- Knowledge Process Outsourcing: means outsourcing in which a business contracts with an
outside company to perform a research or other knowledge- related work.
ex: intellectual property research related to developing and filing a patent application.
-Advantages of outsourcing:
(1) organization can focus on its core competencies while experts in the outsourced company do the
other work.
(2) cost savings: comes from (a) economies of scale where the process provider is able spread such
costs as software leasing or personnel benefits among several clients. (b) shifting data tasks to the
contracting company and depending on the contractor to adjust personnel levels caused by large
swings in monthly processing volumes.
(3) All these advantages enable a company to reduce its own labor force, save money and remain
competitive.
-Disadvantages:
1- Inflexibility: requires companies to commit services for an extended period of time.
2- Loss of control: when an outsourcing vendor performs a significant portion of an organization’s
data processing, the organization loses control of its information systems.
3- Lose Competitive advantage.
4-Implementation,Followup,andMaintenance:
1-systems implementation: is the action phase of a systems study because the recommended
changes from the prior analysis, and development work are now put in action.
*Implementation activities:
- (a) prepare the fiscal site for any new hardware and software. – (b) determine functional
changes.
- (c) select and assign personnel. (d) train personnel. –(e)acquire and install computer
equipment.
-(f) Establish internal controls: that safeguard its assets, ensure the accuracy and reliability of
accounting data, promote operating efficiency, and encourage employee compliance with
prescribed managerial policies.
(g) convert data files: when merging two systems. (h) acquire computer software. –
(i) test computer software. (j) Convert to the new system: the firm may choose to make a
direct conversion by immediately discontinuing use of the old system and letting the new system
"sink or swim". Parallel conversion: the organization operates both
the new and the old system for some period of time. Modular conversion: where the new system
is implemented in stages, one process or module at a time. Ex: implementing the inventory
module, then the order processing ,and so on.

- change management: is the most difficult issue in implementing a new system. The new
system will bring with it changes to to employee job descriptions, and new jobs and no jobs.
Organizations should give the employees whose jobs are either eliminated or materially altered an
opportunity to apply for the new jobs and obtain retraining.

- it is straightforward and easy to understand. Disadvantages: they do not indicate the precedence
of activities for the project. It treats each activity as if it were independent of the others so, it is
very suited for systems implementation projects that are not highly complex and have relatively
few interrelationships among implementation activities.

* project management software: can perform these tasks quickly and easily.
-post implementation review: the purpose of this phase is to monitor the new system and make
sure it continues to satisfy the three level goals of the organization.
- post implementation review report: is prepared for the steering committee that summarizes
the implementation team’s findings.