Unit-IV: Choice of IT

 Unit-IV: Choice of IT 

Nature of IT decision - Strategic decision - Configuration design and evaluation Information technology implementation plan. 

Decision Making: 

Characteristics, Nature, 

Techniques and Other Details 

Decision making may be reviewed as the process of selecting a course of action from among several alternatives in order to accomplish a desired result. The purpose of decision making is to direct human behaviour and commitment towards a future goal. If there are no alternatives, if no choice is to be made, if there is no other way‐out, then there would be not need for decision making. It involves committing the organisation and its resources to a particular choice of course of action thought to be sufficient and capable of achieving some predetermined objective. Managers at all level in the organisation make decision and solve problems. In fact, decision‐making is the process of reducing the gap between the existing situation and the desired situation through solving problems and making use of opportunities. A decision is a course of action consciously selected from available alternatives, with a view to achieving a desired goal. It is an outcome of the judgement and represents a choice and commitment to the same. It is a final resolution of a conflict of needs, means or goals made are the face of uncertainty, complexity and multiplicity. A decision is conclusion reached after consideration it occurs when one option is selected to the exclusion of others – it is rendering of judgement. 

Nature Or Characteristics of Decision Making Decision making is globally thought to be selection from alternatives. It is deeply related with all the traditional functions of a manager, such as planning, organizing, staffing, directing and controlling. When he performs these functions, he makes decisions. However, the traditional management threorists did not pay much attention to decision making. Infact, the meaningful analysis of decision making process was initiated by Chester Bernard (1938) who commented, The process of decision are largely techniques for narrowing choice. The nature of decision‐making may be clearly understood by its following characteristics features: 1. Decision making is an intellectual process, which involves imagination, reasoning, evaluation and judgement. 2. It is a selection process in which best or most suitable course of action is finalized from among several available alternatives. Such selected alternative provides utmost help in the achievement of organizational goals. The problems for which there is only one selection are most decision problems. 3. Decision making is a goal oriented process. Decisions are made to attain certain goals. A decision is rated good to be extent it helps in the accomplishment of objectives. 4. It is a focal point at which plans, policies, objectives, procedures, etc., are translated into concrete actions. 5. Decision making is a continuous process persuading all

organizational activity, at all levels and in the whole universe. It is a systematic process and an interactive activity. 

Elements of Decision Making There are following elements in decision making: • The decision maker. • The decision problem or goal. • Attitudes, values and personal goals of the decision maker. • Assumption with regard to future events and things. • The environment in which decision is to be made. • Available known alternatives and their estimated or imagined outcomes. • Analytical results in the whole perspective. • The constraints. • The act of selection or choice. • Timing of decision. • Proper communication of decision for its effective execution. 

Importance of decision‐making 

1. Implementation of managerial function: Without decision‐making different managerial function such as planning, organizing, directing, controlling, staffing can’t be conducted. In other words, when an employee does, s/he does the work through decision‐making function. Therefore, we can say that decision is important element to implement the managerial function. 

2. Pervasiveness of decision‐making: the decision is made in all managerial activities and in all functions of the organization. It must be taken by all staff. Without decision‐making any kinds of function is not possible. So it is pervasive. 

3. Evaluation of managerial performance: Decisions can evaluate managerial performance. When decision is correct it is understood that the manager is qualified, able and efficient. When the decision is wrong, it is understood that the manager is disqualified. So decision‐making evaluate the managerial performance. 

4. Helpful in planning and policies: Any policy or plan is established through decision making. Without decision making, no plans and policies are performed. In the process of making plans, appropriate decisions must be made from so many alternatives. Therefore, decision making is an important process which is helpful in planning. 

5. Selecting the best alternatives: Decision making is the process of selecting the best alternatives. It is necessary in every organization because there are many alternatives. So decision makers evaluate various advantages and disadvantages of every alternative and select the best alternative. 

6. Successful; operation of business: Every individual, departments and organization make the decisions. In this competitive world; organization can exist when the correct and appropriate decisions are made. Therefore, correct decisions help in successful operation of business. 

Step 1: Identify the decision You realize that you need to make a decision. Try to clearly define the nature of the decision you must make. This first step is very important.

Step 2: Gather relevant information Collect some pertinent information before you make your decision: what information is needed, the best sources of information, and how to get it. This step involves both internal and external “work.” Some information is internal: you’ll seek it through a process of self‐ assessment. Other information is external: you’ll find it online, in books, from other people, and from other sources. 

Step 3: Identify the alternatives As you collect information, you will probably identify several possible paths of action, or alternatives. You can also use your imagination and additional information to construct new alternatives. In this step, you will list all possible and desirable alternatives. 

Step 4: Weigh the evidence Draw on your information and emotions to imagine what it would be like if you carried out each of the alternatives to the end. Evaluate whether the need identified in Step 1 would be met or resolved through the use of each alternative. As you go through this difficult internal process, you’ll begin to favor certain alternatives: those that seem to have a higher potential for reaching your goal. Finally, place the alternatives in a priority order, based upon your own value system. 

Step 5: Choose among alternatives Once you have weighed all the evidence, you are ready to select the alternative that seems to be best one for you. You may even choose a combination of alternatives. Your choice in Step 5 may very likely be the same or similar to the alternative you placed at the top of your list at the end of Step 4. 

Step 6: Take action You’re now ready to take some positive action by beginning to implement the alternative you chose in Step 5. 

Step 7: Review your decision & its consequences In this final step, consider the results of your decision and evaluate whether or not it has resolved the need you identified in Step 1. If the decision has not met the identified need, you may want to repeat certain steps of the process to make a new decision. For example, you might want to gather more detailed or somewhat different information or explore additional alternatives. 

Strategic decision 

Strategic decisions are the decisions that are concerned with whole environment in which the firm operates, the entire resources and the people who form the company and the interface between the two. 

Characteristics/Features of Strategic Decisions 

1. Strategic decisions have major resource propositions for an organization. These decisions may be concerned with possessing new resources, organizing others or reallocating others.

2. Strategic decisions deal with harmonizing organizational resource capabilities with the threats and opportunities. 

3. Strategic decisions deal with the range of organizational activities. It is all about what they want the organization to be like and to be about. 

4. Strategic decisions involve a change of major kind since an organization operates in ever-changing environment. 

5. Strategic decisions are complex in nature. 

6. Strategic decisions are at the top most level, are uncertain as they deal with the future, and involve a lot of risk. 

7. Strategic decisions are different from administrative and operational decisions. Administrative decisions are routine decisions which help or rather facilitate strategic decisions or operational decisions. Operational decisions are technical decisions which help execution of strategic decisions. To reduce cost is a strategic decision which is achieved through operational decision of reducing the number of employees and how we carry out these reductions will be 

administrative 

MIS - Development Process 

In MIS, the information is recognized as a major resource like capital and time. If this resource has to be managed well, it calls upon the management to plan for it and control it, so that the information becomes a vital resource for the system. 

● The management information system needs good planning. ● This system should deal with the management information not with data processing alone. 

● It should provide support for the management planning, 

decision-making and action. 

● It should provide support to the changing needs of business management. 

Major challenges in MIS implementation are − 

● Quantity, content and context of information − how much 

information and exactly what should it describe.

● Nature of analysis and presentation − comprehensibility of information. 

● Availability of information − frequency, contemporariness, on-demand or routine, periodic or occasional, one-time info or repetitive in nature and so on 

● Accuracy of information. 

● Reliability of information. 

● Security and Authentication of the system. 

Planning for MIS 

MIS design and development process has to address the following issues successfully − 

● There should be effective communication between the developers and users of the system. 

● There should be synchronization in understanding of management, processes and IT among the users as well as the developers. 

● Understanding of the information needs of managers from different functional areas and combining these needs into a single integrated system. 

● Creating a unified MIS covering the entire organization will lead to a more economical, faster and more integrated system, however it will increase in design complexity manifold. 

● The MIS has to be interacting with the complex environment comprising all other sub-systems in the overall information system of the organization. So, it is extremely necessary to understand and define the requirements of MIS in the context of the organization.

● It should keep pace with changes in environment, changing demands of the customers and growing competition. 

● It should utilize fast developing in IT capabilities in the best possible ways. 

● Cost and time of installing such advanced IT-based systems is high, so there should not be a need for frequent and major modifications. ● It should take care of not only the users i.e., the managers but also other stakeholders like employees, customers and suppliers. 

Once the organizational planning stage is over, the designer of the system should take the following strategic decisions for the achievement of MIS goals and objectives − 

● Development Strategy − Example - an online, real-time batch. ● System Development Strategy − Designer selects an approach to system development like operational verses functional, accounting verses analysis. 

● Resources for the Development − Designer has to select resources. Resources can be in-house verses external, customized or use of package. 

● Manpower Composition − The staffs should have analysts, and programmers. 

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 Requirements 

The following diagram illustrates a brief sketch of the process of information requirement analysis − 

The following three methodologies can be adopted to determine the requirements in developing a management information system for any organization − 

● Business Systems Planning (BSP) − this methodology is developed by IBM. 

○ It identifies the IS priorities of the organization and 

focuses on the way data is maintained in the system.

○ It uses data architecture supporting multiple 

applications. 

○ It defines data classes using different matrices to 

establish relationships among the organization, its 

processes and data requirements. 

● Critical Success Factor (CSF) − this methodology is developed by John Rockart of MIT. 

○ It identifies the key business goals and strategies of 

each manager as well as that of the business. 

○ Next, it looks for the critical success factors underlying 

these goals. 

○ Measure of CSF effectiveness becomes an input for 

defining the information system requirements. 

● End/Means (E/M) analysis − this methodology is developed by Wetherbe and Davis at the University of Minnesota. 

○ It determines the effectiveness criteria for outputs and 

efficiency criteria for the processes generating the 

outputs. 

○ At first it identifies the outputs or services provided by 

the business processes. 

○ Then it describes the factors that make these outputs 

effective for the user. 

○ Finally it selects the information needed to evaluate 

the effectiveness of outputs 

Information System Analysis and Design

System analysis and design follows the typical System/Software Design Life Cycle (SDLC) as discussed in the previous chapter. It generally passes through the following phases − 

● Problem Definition 

● Feasibility Study 

● Systems Analysis 

● System Design 

● Detailed System Design 

● Implementation 

● Maintenance 

In the analysis phase, the following techniques are commonly used − 

● Data flow diagrams (DFD) 

● Logic Modeling 

● Data Modeling 

● Rapid Application Development (RAD) 

● Object Oriented Analysis (OOA) 

Technology for Information Systems 

The technology requirement for an information system can be categorized as − 

● Devices 

● Data center systems − It is the environment that provides 

processing, storage, networking, management and the distribution of data within an enterprise.

● Enterprise software − These are software system like ERP, SCM, Human Resource Management, etc. that fulfill the needs and objectives of the organizations. 

● IT services − It refers to the implementation and management of quality IT services by IT service providers through people, process and information technology. It often includes various process improvement frameworks and methodologies like six sigma, TQM, and so on. 

● Telecom services 

System Test Planning and Execution 

The system should be fully tested for errors before being fully operational. The test plan should include for each test − 

● Purpose 

● Definition 

● test inputs 

● detailed specification of test procedure 

● details of expected outputs 

Each sub-system and all their components should be tested using various test procedures and data to ensure that each component is working as it is intended. 

The testing must include the users of the system to identify errors as well as get the feedback. 

System Operation 

Before the system is in operation, the following issues should be taken care of −

● Data security, backup and recovery; 

● Systems control; 

● Testing of the system to ensure that it works bug-free in all expected business situations; 

● The hardware and software used should be able to deliver the expected processing; 

● The system capacity and expected response time should be maintained; 

● The system should be well documented including; 

○ A user guide for inexperienced users, 

○ A user reference or operations manual for advanced 

users, 

○ A system reference manual describing system 

structures and architecture. 

Once the system is fully operational, it should be maintained throughout its working life to resolve any glitches or difficulties faced in operation and minor modifications might be made to overcome such situations. 

Factors for Success and Failure 

MIS development projects are high-risk, high-return projects. Following could be stated as critical factors for success and failure in MIS development − 

● It should cater to a specific, well-perceived business. 

● The top management should be completely convinced, able and willing to such a system. Ideally there should be a patron or a sponsor for the system in the top management.

● All users including managers and other employees should be made an integral part of the development, implementation, and use of the system. 

● There should be an operational prototype of the system released as soon as possible, to create interest among the users. 

● There should be good support staff with necessary technical, business, and interpersonal skills. 

● The system should be simple, easy to understand without adding much complexity. It is a best practice, not to add up an entity unless there is both a use and user for it. 

● It should be easy to use and navigate with high response time. ● The implementation process should follow a definite goal and time. ● All the users including the top management should be given proper 

training, so that they have a good knowledge of the content and function of the system, and can use it fully for various managerial activities such as reporting, budgeting, controlling, planning, monitoring, etc. 

● It must produce useful outputs to be used by all managers. ● The system should be well integrated into the management processes of planning, decision-making, and monitoring.