MANAGEMENT ISSUES IN SYSTEM DEVELOPMENTAndreas Rio, M.Eng.contact@andreasrio.com

Information System Management

The four major issues discussed: Staffing Successfully implementing systems

(change management) Ways to replace legacy systems Measuring the benefits of systems

Introduction

Companies are in three businesses: 1. Infrastructure management2. Customer relationship3. Product innovation

Introduction

IS organizations can be viewed as being in the same three businesses

1. Operations are infrastructure management2. The help desk is the customer relationship

business 3. System development is product innovation Each should be viewed and managed

differently. The key to success is talent, so management

issues surrounding system development begin with STAFFING

Managing IS Staff

STAFFING

Managing IS Staff

Recruiting IT Staff

Managing IS Staff

Recruiting IT Staff The major issue in recruiting is finding people

with the right skills and then providing the work culture and incentives that suit them

In general, skills are most lacking in the newest areas

Some employers are looking at employees in new ways, such as investors who invest their time where they get the highest market value for their talent

Another is to not expect long-term employment by all employees

Managing IS Staff

Designing Motivating Work Assigning the kind of work that motivates

people may, in part, revolve around designing or redesigning jobs to fit jobholders.

Knowing what motivates IT staff is important in designing jobs.

In a long research study it was discovered that developers have a high need for personal growth and development in the job.

Managing IS Staff

Implementing System Successfully

CHANGE MANAGEMENT

Implementing System Successfully

Sponsors – legitimize the change Change Agents – cause the change

to happen Targets – are expected to change

Implementing System Successfuly Change management is the process of

assisting people to make major changes in their working environment.

One approach to change management is to identify and work with sponsors change agents targets

to implement the change a new system

To replace or not to replace?

IMPROVING LEGACY SYSTEM

Improving Legacy System

Most information systems executives feel trapped by the past

They have thousands of old legacy programs and data files they would love to replace.

Replacement is not the only option, though, and in many cases it is not the wisest course of action.

One study found that upgrading (rather than replacing) made more sense in most cases.

Improving Legacy System

1. Restructure the System If the system is running but fragile,

restructure the code, using automated tools, to make the system more maintainable.

Improving Legacy System

2. Reengineer the System Extract the data elements from the existing

file and the business logic from the existing program and

Improving Legacy System

3. Refurbish the System (restore something to good repair) Old but maintainable systems that are

causing no major problems may just need some extensions to be more useful.

Companies are leaving existing systems in place but adding an Internet front end.

Improving Legacy System

4. Rejuvenate the System (return something original condition) Rejuvenating adds enough new functions to a

system to make it more valuable to the firm.

Improving Legacy System

5. Re architect the System This option involves having a to-be

architecture for new systems, then using that architecture to upgrade legacy systems.

Improving Legacy System

6. Replace with a package Many old systems built in-house have been

replaced by a package developed by a third party.

This alternative has become the norm; another option is to replace a system with a service delivered over the Internet.

Improving Legacy System

7. Rewrite the system In some cases, a legacy system is too far

gone to rescue. Few companies write new applications from scratch, though, since it is so time-consuming and expensive;

Rewriting now means system integration — finding packages that do pieces of the work, then using middleware tools to link them together.

MEASURING THE BENEFITS OF SYSTEMS

Measuring the Benefits of Systems1. Distinguish Between the Different

Roles of Systems2. Measure What Is Important to

Management3. Assess Investments Across

Organizational Levels

Measuring the Benefits of Systems1. Distinguish Between the Different

Roles of Systems To measure the value of systems that help

other departments do their job better, measure how they improve organizational efficiency.

For systems that carry out a business strategy, measure them by their contribution to the success or failure of that plan.

And for systems that are sold as a product or service, measure them by their performance in the market.

Measuring the Benefits of Systems2. Measure What Is Important to

Management Besides financial benefits relating proposed benefits to certain

indicators can make it easier to “sell” the system to management,

at both the individual and aggregate levels. Concentrating only on cost and monetary

measures may be shortsighted; other measures can be even more important.

Measuring the Benefits of Systems3. Assess Investments Across

Organizational Levels The Value Assessment Framework

measures benefits at three organizational levels: individual, division, and corporation

and across three kinds of impacts: economic performance payoffs, organizational process impacts, and technology impacts.

Measuring the Benefits of SystemsDo Investors Value IT Investments? A study found that :

$1 invested in computers yielded up to $17 in stock market value – and no less than $5.

$1 invested in property, plant, and equipment only yielded $1 in stock market value

$1 investment in other assets (inventory, liquid assts, and accounts receivables) yielded only 70 cents.

The researchers reason that investors value $1 spent on computers more than the other investments because it leads to organizational changes that create $16 worth of “intangible assets”– know-how, skills, organizational structures, and such.

Conclusion

Managing development staff well is a major part of the job of managing system development.

Helping end users adjust to the organizational changes that occur with a new system is a second issue.

Most software is difficult to keep up to date. As a result, at some point in time, management needs to decide what to do with aging software.

Finally, the question continually asked about applications is, “What is it worth to us?”— another difficult system development issue.