UNIT-3

MANAGEMENT INFORMATION SYSTEM

INFORMATION SYSTEM PLANNING

• Information system planning essentially involves −

• Identification of the stage of information system in the organization.
• Identification of the application of organizational IS.
• Evolution of each of this application based on the established evolution criteria.
• Establishing a priority ranking for these applications.
• Determining the optimum architecture of IS for serving the top priority
applications.
INFORMATION SYSTEM PLANNING
INFORMATION SYSTEM PLANNING

• Nolan Stages Model

• Nolan stage has identified four stages of information system growth
• Stage-1 It is known as initiation stage. In this stage technology is placed in the
organization. A few application in the organization are computerized. There are only
small number of users.
• Stage-2 It is called as expansion stage. During this stage rapid and uncontrolled growth in
the number and variety of IT application takes place. Many users adopt computer in
solving their IT related problems
INFORMATION SYSTEM PLANNING

• Stage-3 Formalization: In this stage organizations gain control over technology’s

resources by implementing the formal control process and standards.
• Stage -4 maturity and Integration : In this stage organization gain sufficient experience
and maturity IS/IT application. In this stage applications are integrated, controls are
adjusted and planning is well established. That is why this growth stage sometimes is also
called the stage of perfection.
CREATING AN INFORMATION SYSTEM PLAN
(CRISP)
• (i) Strategic analysis
• (ii) Aligning of IS’s with the business
• (iii) Information analysis
• (iv) Identification of IS Solution
• (v) Prioritization of IS’s
 SYSTEM ACQUISITION

• As discussed in IS planning, once the requirement of IS application and the sequence in which these applications
are to be implemented on the organization are decided, management needs to take decision whether to
• A) develop these application (either in-house or by outsourcing to a vendor/development house) or
• B) Acquire these applications by either purchasing the IS application or hiring the services of a vendor/service
agents.

• IS Choice: Developing information system in-house or engaging a software company may be the most
expensive way to implement IS. There are some other alternatives, which might be less expensive and may give
other benefits There are generally four alternative to in-house development
 SYSTEM ACQUISITION

• 1) Outsourcing
• 2) Software licensing
• 3) Using the services of an application service providers.
• 4) End-user development
• 1) Outsourcing refers to hiring the services of another organization or individual to perform some work that otherwise would be
performed by the organization itself.
• Outsourcing with regard to IT refers to
• a) Hiring some organizations for the development of information system
• b) Hiring the services of another company to manage all or part of the services that otherwise would be rendered by the by an IT
unit of the organization.
 SYSTEM ACQUISITION

• Outsourcing IS application
• An organization may outsource the development of an IS application to another organization when the organization finds the existing commercial
IS cannot satisfy their requirements and they have to develop a custom designed application to companies that specialize is providing consulting
and software development services. Outsourcing custom-designed applications have several advantages and disadvantages
• Advantages
• Fit to business
• Fit to organization culture
• Availability to trained manpower for maintenance
• Interface with other information systems
• Availability of desired security measures
• Strategic advantage
 SYSTEM ACQUISITION

• Disadvantage
• High Cost
• Long wait for development
• IS may be too organization-specific to interface with systems of others organizations
• Incompatibility with development methods
• Communication gap
 SYSTEM ACQUISITION

• Outsourcing of IT services
• Many business organizations may like to engage IT companies for long term services such as purchasing and maintaining hardware,
developing, licensing, maintaining software, installing and maintaining communication networks, developing, maintaining and
operating websites, running day-to-day IT operations, managing customer and supplier relations so on. An organization might use a
combination of in-house and outsourcing services. Organization that provide IT services include IBM, DELL, Hewlett-Packard,
Accenture, Capgemini etc.
• Advantages
• Increased attention to core business
• Improved financial planning
• Reduce license and maintenance fee
• Shorter Implementation cycle
 SYSTEM ACQUISITION

• Reduction of personnel and fixed cost

• Increased access to highly qualified know-how
• Availability of ongoing consulting as part of standard support
• Risk of outsourcing IT services
• Loss of control( With outsourcing, the organization may lose control to outsiders)
• Loss of experienced employees
• Risk of losing the competitive advantage
• High price
 SYSTEM ACQUISITION

• Software Licensing
• These days, a large number of high quality packaged software is available in the market for purchase. These
packages are usually available for a large number of users. Therefore purchasing pre-packaged software should
be the first alternative, when a company needs to acquire a new system. Typically purchased software refers to
licensed software. The purchaser actually purchases a license to use the software itself.
• Ready made software may be used as routine applications or as enterprise-wide applications and accordingly
these packages may be classified into two groups
• 1) Small applications
• 2) Large applications
 SYSTEM ACQUISITION

• Software Licensing benefits

• Immediate system availability
• High quality
• Low price
• After sales support
• Software Licensing Risk
• Inadequate fit between needs and features
• Difficulties in modification
• Bankruptcy of the vendor
• High turnover of the vendor personnel
 SYSTEM ACQUISITION

• Software Licensing benefits

• Immediate system availability
• High quality
• Low price
• After sales support
• Software Licensing Risk
• Inadequate fit between needs and features
• Difficulties in modification
• Bankruptcy of the vendor
• High turnover of the vendor personnel
 SYSTEM ACQUISITION

• Software as a Service (SaaS) means renting out the application through the web. An organizations that offer the use of
software through communication lines is called an application service provider. Many companies including IBM, Oracle
Corporation offer such services.
• Benefits
• The organizations is not required to commit large sums of upfront money
• The application is immediately available
• There is no need to hire experts for installation and maintenance
• There is no acquire hardware for the installations
• There is no need to learn how to maintain the application, as the responsibility of ASP.
• No storage is required for the application and associated data as the vendor uses its own hardware
 SYSTEM ACQUISITION

• Risk
• There may be a long transaction response time on the internet
• There is high security risk as the application is controlled by the vendor
• End User Development : When the application is simple and is not available as a ready-made package in the
market, or the organization does not want to take any risk in purchasing or renting it, the organization has got
another alternative, know a end-user application development. In this approach, the user managers, even
without any background of programming, write their own business applications.
 SYSTEM DEVELOPMENT MODELS

• Water Fall Model

 SYSTEM DEVELOPMENT MODELS

• Systems Development Life Cycle

 SYSTEM DEVELOPMENT MODELS

•V Model
•Business Requirement Analysis: This is the first phase in the
development cycle where the product requirements are
understood from the customer’s perspective.
•System Design: Once you have the clear and detailed
product requirements, it is time to design the complete
system.
•Architectural Design Architectural specifications are
understood and designed in this phase. Usually more than
one technical approach is proposed and based on the
technical and financial feasibility the final decision is taken.
 SYSTEM DEVELOPMENT MODELS

•Module Design: In this phase, the detailed internal

design for all the system modules is specified,
referred to as Low Level Design (LLD). 
•Unit testing is the testing at code level and helps
eliminate bugs at an early stage, though all defects
cannot be uncovered by unit testing.
•Integration Testing: Integration testing is associated
with the architectural design phase. Integration tests
are performed to test the coexistence and
communication of the internal modules within the
system.
 SYSTEM DEVELOPMENT MODELS

•System Testing: System testing is directly associated with the

system design phase. System tests check the entire system
functionality and the communication of the system under
development with external systems. Most of the software and
hardware compatibility issues can be uncovered during this
system test execution.
•Acceptance Testing: Acceptance testing is associated with the
business requirement analysis phase and involves testing the
product in user environment. Acceptance tests uncover the
compatibility issues with the other systems available in the
user environment. It also discovers the non-functional issues
such as load and performance defects in the actual user
environment.
 SYSTEM DEVELOPMENT MODELS

• Prototype Model
• Requirement Gathering and Analyst
• Quick Decision
• Build a Prototype
• Assessment or User Evaluation
• Prototype Refinement
• Engineer Product
 SYSTEM DEVELOPMENT MODELS

• Computer- assisted and software engineering

tools (CASE)
 IMPLEMENTATION AND EVALUATION

• IMPLEMENTATION TASKS: The major implementation task consists of:

• 1. Planning the implementation activities
• 2. Acquiring and laying out facilities and offices
• 3. Organizing the personnel for implementation
• 4. Developing procedures for installation and testing
• 5. Developing the training program for operating personnel
• 6. Completing the system’s software
• 7. Acquiring required hardware
• 8. Generating files
 IMPLEMENTATION AND EVALUATION

• 9. Designing forms
• 10. Testing the entire system
• 11. Completing cutover to the new system
• 12. Documenting the system
• 13. Evaluating the MIS
• 14. Providing system maintenance (debugging and improving)