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Chapter 13

Building Information Systems

True-False Questions

1. The overall business plan of the organization should support the information systems plan.Reference: p. 496

2. An organization must have a clear understanding of both its long- and short-term informationrequirements if it is going to develop an effective information systems plan.Reference: p. 496

3. An information systems plan should be decided on before selecting specific projects withinthe overall context of a strategic plan.Reference: p. 496

4. When developing an information systems plan, the organization is only required to have abasic understanding of its short-term information requirements.Reference: p. 496

5. The weakness of enterprise analysis is that it produces an enormous amount of data that isexpensive to collect and difficult to analyze.Reference: p. 498

6. The principle method used in CSF analysis is JAD.Reference: p. 499

7. The strength of the CSF method is that it produces a smaller data set to analyze than theenterprise analysis method.Reference: p. 499

8. Organizational and individual CSFs must be the same within the organization if theorganization is to succeed.Reference: p. 500

9. Rationalization of procedures often follows quickly from early automation.Reference: p. 500

10. An organizational change involving a paradigm shift is low risk and high return.Reference: p. 501

11. If organizations wait to apply computing power until after they rethink and redesign theirbusiness processes, they may obtain large payoffs.Reference: p. 501

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14-2 Redesigning the Organization with Information Systems Chapter 14

12. The conventional method of designing systems establishes how information technology cansupport processes and then establishes the information requirements of each businessfunction.Reference: p. 502

13. Information technology can create new design options for various processes.

Reference: p. 504

14. The majority of reengineering projects achieve breakthrough gains in business performance.Reference: p. 504

15. TQM derives from concepts developed by American quality experts, but was popularized inJapan.Reference: p. 505

16. Systems development activities always take place in sequential order.Reference: p. 506

17. Faulty requirements analysis is a leading cause of systems failure and high systemsdevelopment costs.Reference: p. 507

18. End users should not be included in the design process, but must be involved later.Reference: p. 508

19. The amount of testing time needed for a new system is consistently underrated.Reference: p. 509

20. Thorough testing is not required if, during the programming stage, the design documents aresufficiently detailed.Reference: p. 509

21. Test-plan documentation consists of a series of test-plan screens maintained on a database.Reference: p. 510

22. Detailed documentation showing how the system works is usually finalized beforeconversion time for use in training and everyday operations.Reference: p. 510

23. The system is not in production until conversion is complete.Reference: p. 511

24. Documentation reveals how well the system has met its original objectives.

Reference: p. 511

25. A data flow diagram offers a logical and graphical model of information flow, partitioning asystem into modules that show manageable levels of detail.Reference: p. 512

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26. Object-oriented frameworks have been developed to provide reusable, semi-completeapplications a company can customize into finished applications.Reference: p. 513

27. A structure chart is a bottom-up chart, showing each level of design, its relationship to otherlevels, and its place in the overall design structure.

Reference: p. 514

28. Object-oriented development is more iterative and incremental than traditional structureddevelopment.Reference: p. 514

29. Objects are grouped into hierarchies, and hierarchies into classes.Reference: p. 514

30. Structural diagrams are used to describe the relationships between classes of objects.Reference: p. 515

31. CASE tools facilitate the creation of clear documentation and the coordination of teamdevelopment efforts.Reference: pp. 516-517

32. The oldest method for building information systems is prototyping.Reference: p. 516

33. Prototyping is more iterative than the conventional lifecycle.Reference: p. 517

34. A problem with prototyping is that the systems constructed thereby may not be able to handlelarge quantities of data in a production environment.Reference: p. 518

35. End-user-developed systems can be completed more rapidly than those developed throughthe conventional systems lifecycle.Reference: p. 519

36. An advantage of fourth-generation tools is that they can easily handle processing largenumbers of transactions or applications with extensive procedural logic and updatingrequirements.Reference: p. 519

37. Generally all costs of a system are obvious at the beginning of a project.Reference: p. 522

38. In some forms of outsourcing, a company hires an external vendor to create the software forits system, but operates the software on its own computers.Reference: p. 522

39. In the digital firm environment, organizations must be able to add, change, and retiretechnology capabilities much more rapidly than traditional development methods will allow.Reference: p. 525

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40. Businesses are using component-based development to create their e-commerce applications.Reference: p. 526

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46. The radical redesign of business processes is:

a.rationalization of procedures.b.paradigm shifts.c.accessibility and empowerment.d.business process reengineering.

Reference: p. 501

47. A paradigm shift involves:

a.rethinking the nature of the business itself.b.rethinking the nature of the information systems process itself.c.rethinking the nature of the organization itself.d.Both a and bReference: p. 501

48. When systems are used to strengthen the wrong business model or business processes:

a.the resulting information system is very difficult to analyze.b.the resulting system has no impact on the firms performance.c.the business becomes more efficient doing what it shouldnt do.d.organizational change does not occur.Reference: p. 502

49. When many companies work together to jointly redesign their shared processes, JamesChampy calls the procedure:

a.enterprise engineering.b.Six sigma.c.BPR.

d.X-engineering.Reference: p. 504

50. Business process management does not include::

a.data flow diagramsb.process monitoring.c.analyticsd.work flow management.Reference: p. 504

51. TQM focuses on:

a.mid-level management.b.a series of continuous improvements.c.a few large-scale improvements.d.eliminating design errors.Reference: p. 505

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52. A specific measure of quality, representing 3.4 defects per million opportunities bestdescribes:

a.return on investment.b.activity-based cost.c.internal rate of return.

d.six sigma.Reference: p. 505

53. External industry standards, standards set by other companies, and/or internallydeveloped high standards are used to set up:

a.total quality management.b.six sigma installation.c.benchmarking procedures.d.workflow management.Reference: p. 506

54. Systems design:

a.describes what a system should do to meet information requirements.b.shows how the new system will fulfill the information requirements?.c.always tries to increase precision.d.includes the testing phases.Reference: p. 507

55. The entire system-building effort is driven by:

a.systems analysis.b.end-user support capabilities.

c.the database design.d.user information requirements.Reference: p. 508

56. Unit testing:

a.includes all the preparations for the series of tests to be performed on the system.b.tests the functioning of the system as a whole in order to determine if discrete modules

will function together as planned.c.tests each program separately.d.provides the final certification that the system is ready to be used in a production

setting.

Reference: p. 509

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57. System testing:

a.includes all the preparations for the series of tests to be performed on the system.b.tests the functioning of the system as a whole in order to determine if discrete modules

will function together as planned.c.tests each program separately.

d.provides the final certification that the system is ready to be used in a productionsetting.

Reference: p. 509

58. Acceptance testing:

a.includes all the preparations for the trials.b.tests the functioning of the system as a whole in order to determine if discrete modules

will function together as planned.c.tests each program separately.d.provides the final certification that the system is ready to be used in a production

setting.

Reference: p. 509

59. In the pilot study conversion strategy, the new system:

a.is tested by an outsourced company.b.replaces the old one at an appointed time.c.and the old are run together.d.is introduced to a limited area until it is proven to work properly.Reference: p. 510

60. In the parallel conversion strategy, the new system:

a.is tested by an outsourced company.b.replaces the old one at an appointed time.c.and the old are run together.d.is introduced to a limited area until it is proven to work properly.Reference: p. 510

61. In the direct cutover conversion strategy, the new system:

a.is tested by an outsourced company.b.replaces the old one at an appointed time.c.and the old are run together.

d.is introduced to a limited area until it is proven to work properly.Reference: p. 510

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62. The _____________ occurs after the system is in production.

a.preparation of documentationb.iterative process

c.post implementation audit

d.feasibility auditReference: p. 511

63. Changes in hardware, software, documentation, or production to a production system tocorrect errors, meet new requirements, or improve processing efficiencies are termed:

a.tested.b.classified.c.maintenance.d.models.Reference: p. 511

64. In terms of percentages, the maintenance phase devotes approximately _____ percent tochanges in data, files, reports, hardware, or system software.

a.20b.25c.40d.35Reference: p. 511

65. The primary tool for representing a systems component processes and the flow of databetween them is the:

a.data dictionary.b.knowledge base.c.user documentation.d.data flow diagram.Reference: p. 512

66. A tool for structured analysis that contains information about individual pieces of dataand data groups within the system is called the:

a.data dictionary.b.data catalog.c.data master.

d.data log.Reference: p. 512

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67. In object-oriented software development, relationship between objects would bedescribed using:

a.structural diagrams.b.behavioral diagrams.c.use case diagrams.

d.object diagrams.Reference: p. 515

68. Object-oriented modeling is based on the concepts of:

a.processes and data classes.b.data classes and data flows.c.class and inheritance.d.logical application groups and data classes.Reference: p. 513

69. Object-oriented development could potentially reduce the time and cost of writing

software because:

a.object-oriented programming requires less training.b.iterative prototyping is not required.c.objects are reusable.d.a graphical interface is automatic.Reference: p. 514

70. The industry standard for representing various views of an object-oriented system thatuses a series of graphical diagrams is:

a.XTHML.

b.XML.c.UML.d.PPT.IP.Reference: p. 514

71. Behavioral diagrams are used to:

a.describe interactions in an object-oriented system.b. describe how employees will react to learning new systems.c.reduce the need for extensive programming.d.describe relationships between classes.Reference: p. 515

72. The oldest method for building information systems is the:

a.pilot study.b.systems approach.c.iterative process.d.systems life cycle.Reference: p. 516

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73. In the traditional systems life cycle, end users:

a.are important and ongoing members of the team from the original analysis phasethrough maintenance.

b.are important only in the testing phases.c.have no input.

d.are limited to providing information requirements and reviewing the technical staffswork.

Reference: pp. 517-518

74. The use of _______________ is most likely to produce systems that fulfill userrequirements.

a.documentationb.prototypingc.a pilot studyd.a parallel strategyReference: p. 518

75. When systems are created rapidly, without a formal development methodology:

a.end users can take over the work of IT specialists.b.the organization quickly outgrows the new system.c.hardware, software, and quality standards are less important.d.testing and documentation may be inadequate.Reference: p. 519

76. Management should control the development of end-user applications by:

a.developing a formal development methodology.

b.requiring cost justification for end-user IS projects.c.establishing standards for user-developed applications.d.Both b and cReference: p. 519

77. If an organizations requirements conflict with the software package chosen and thepackage cannot be customized, the organization will have to:

a.outsource the development of the system.b.redesign the RFP.c.change the evaluation process.d.change its procedures.

Reference: p. 521

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78. Hidden costs such as _____________________ can easily undercut anticipatedbenefits from outsourcing.

a.monitoring vendors to make sure they often are fulfilling their contractual obligations.b.transitioning to a new vendor.c.identifying and evaluating vendors of information technology services

d.a, b, and cReference: p. 522

79. Systems must be scalable to accommodate growing numbers of users and:

a.to deliver data over multiple platforms.b.to accommodate new interfaces.c.to accommodate systems built by external vendors.d.to accommodate applications packages.Reference: p. 525

80. Web services use:

a.a proprietary architecture.b.a plug and play architecture.c.joint application development.d. rapid application development.Reference: p. 528

Fill in the Blanks

81. Enterprise analysis is also known as business systems planning.

Difficulty: Medium Reference: p. 496

82. Critical success factors are a small number of easily identifiable operational goals shaped bythe industry, the firm, the manager, and the broader environment that are believed to assurethe success of an organization.

Difficulty: Hard Reference: p. 499

83. Automation uses the computer to speed up the performance of existing tasks.


84. Rationalization of procedures is the streamlining of standard operating procedures,eliminating obvious bottlenecks, so the automation makes operating procedures moreefficient.


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85. Business process reengineeringis the radical redesign of business procedures, combiningsteps to cut waste and eliminate repetitive, paper-intensive tasks.


86. A(n) paradigm shiftis a radical reconceptualization of the nature of the business and the

nature of the organization.


87. Work flow managementis the process of streamlining business procedures so the documentscan be moved easily and efficiently from one location to another.

Difficulty: Easy Reference: p. 502

88. Six sigma is a specific measure of quality, representing 3.4 defects per million opportunities.


89. Total quality management (TQM) focuses on making a series ofcontinuous improvements..


90. Benchmarkingis the setting of strict standards for products, services, or activities andmeasuring organizational performance against those standards.


91. Systems developmentis the activities that go into producing an information systems solutionto an organizational problem or opportunity.


92. A(n)feasibility study is the way the organization determines whether the solution isachievable, given the organizations resources and constraints.


93. Information requirements contain a detailed statement of the information needs that a newsystem must satisfy; identifies who needs what information, and when, where, and how theinformation is needed.


94. A(n) systems design details how a system will meet the information requirements asdetermined by the study of information needs.


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95. Programmingis the process of translating the system specifications prepared during thedesign stage into code.


96. Testingis the exhaustive and thorough process that determines whether the system produces

the desired results under known conditions.


97. A(n) test plan includes all the preparations for the series of tests to be performed on thesystem.


98. Conversion is the process of changing from the old system to the new system.


99. A(n)parallel strategy is the safest and most conservative conversion approach.


100. Documentation describes how an information system works from both the technical and theend-user standpoints.


101. Structuredrefers to the fact that the techniques are step by step, with each step building onthe previous one.


102. A data flow diagram represents a systems component processes and the flow ofdatabetween them..


103. Process specifications describe the transformation occurring within the lowest level of thedata flow diagrams. They express the logic of each process.


104. In structured methodology, the structure chartis a top-down chart, showing each level ofdesign, it relationship to other levels, and its place in the overall design structure.


105. Object-orienteddevelopment uses the object as the basic unit of system analysis and design.


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106. In a class diagram, the attributes for each class are displayed in the middle portion of eachbox.


107. Unified Modeling Language (UML) has become the industry standard for representing

various views of an object-oriented system using a series of graphical diagrams.


108. Behavioraldiagrams are used to describe interactions in an object-oriented system.


109. Back-endCASE tools are used for coding, testing, and maintenance work.


110. The systems life cycle is a traditional methodology for developing an information system thatpartitions the systems development process into formal stages that must be completedsequentially.


111. Prototypingis the process of building an experimental system quickly and cheaply fordemonstration and evaluation.


112. A(n)prototype is the preliminary working version of an information system.


113. End-user developmentis the development of information systems by end-users with little orno formal assistance from technical specialists.


114. Query languages are software tools that provide immediate online answers to requests forinformation that are not predefined.


115. Customization is the modification of a software package to meet the organizations uniquerequirements without destroying the package softwares integrity.


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116. A(n) Request for Proposal (RFP) is a detailed list ofquestions submitted to providers ofsoftware or other services to determine how well the vendors product can meet theorganizations specific requirements.


117. Outsourcingis the practice of contracting various operations to external vendors.


118. Rapid application development is a process for developing systems in a very short time byusing prototyping, fourth-generation tools, and close teamwork among users and systemsspecialists.


119. Joint application design is a process used to accelerate the generation of informationrequirements by having end-users and information system specialists work together in

intensive interactive design sessions.


120. Web services are software components deliverable over the Internet that enable oneapplication to communicate with another with no translation required using a standard plug-and-play architecture.

Difficulty: Easy Reference: pp. 526 and 528

Essay Questions

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121. Compare the strengths and weaknesses of enterprise analysis and strategic analysis.

Enterprise analysis argues that the firms information requirements can only be understoodby looking at the entire organization in terms of organizational units, functions, processes,and data elements. The central method used in the enterprise analysis approach is to take alarge sample of managers and ask them how they use information, where they get it, what

their environments are like, what their objectives are, how they make decisions, and whattheir data needs are. The results of this survey of managers are aggregated subunits,functions, processes, and data matrices. The strength of enterprise analysis is in its completepicture of the way the organization conducts its business. The weakness of the enterpriseanalysis is that it produces so much data that it is expensive to conduct and difficult toorganize and analyze. A further weakness is that the enterprise analysis tends to look at theway existing information is used and not at the fact that new approaches may be required.

The strategic analysis, or critical success factors, approach argues that organizationsinformation requirements are determined by a small number of critical success factors ofmanagers. The premise of the strategic analysis approach is that there are a small number ofobjectives and that managers can easily identify them. The principal method used is the

personal interview three or four with a number of top managers to identify their goals andthe resulting critical success factors. Systems are then built to deliver information on thesecritical success factors. The strength of the CSF method is that it produces smaller data setsthan does enterprise analysis. The CSF method takes into account the changing environmentwith which organizations and managers must operate. It is especially suitable for topmanagement and for the development of DSS and ESS. The methods primary weakness isthat the aggregation process and the analysis of the data are art forms. There is noparticularly rigorous way in which individual CSFs can be aggregated into a clear companypattern. A second problem is that there is often confusion among interviewees betweenindividual and organizational CSFs. They are not necessarily the same. What can be criticalto a manager may not be important to the entire organization. Finally, the method is biasedtoward top managers because they are generally the only ones interviewed.

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122. Describe the process that banks have gone through in reengineering the home mortgageindustry.

The application process for a mortgage once took about six to eight weeks and cost about$3,000. The process is divided into three stages: origination, servicing, and secondarymarketing. In the past, a mortgage applicant filled out a paper loan application. The bank

entered the application into its computer system. Specialists, perhaps in as many as 8different departments, accessed and evaluated the application individually. If it wasapproved, the closing was scheduled. After the closing, bank specialists dealing withinsurance or funds in escrow serviced the loan. This desk-to-desk assembly-line approachmight have taken up to 17 days.

Banks have replaced this sequential process with a faster team approach. Load originatorsin the field enter the application directly into laptop computers. Software checks theapplication transaction to make sure that all of the information is correct and complete. Theloan originators transmit the application using a dial-up network to regional productioncenters. The various specialists convene electronically, working as a team to approve themortgage. Some banks provide customers with a nearly instant credit lock-in of a guaranteed

mortgage so they can find a house that meets their budget immediately. After closing,another team of specialists sets up the loan for servicing. The entire loan process can take aslittle as two days.

123. What are the steps in an effective reengineering process?

To reengineer effectively, senior management must develop a broad strategic vision that callsfor redesigned business processes. Companies should next identify a few core businessprocesses to be redesigned, focusing on those with the greatest potential payback in strategicvalue. Next, management must understand and measure the performance of the existingprocesses as a baseline. Using information technology creates new design options for variousprocesses because it can be used to challenge long-standing assumptions about work

arrangements that use to inhibit organizations. The organizations IT infrastructure shouldhave capabilities to support business process changes that span boundaries betweenfunctions, business units, or firms. It must also be remembered that a new informationsystem always affects jobs, skill requirements, workflows, and reporting relationships. Fearof these changes will breed resistance, confusion, and even conscious efforts to underminethe changes. Thus, in reengineering, people as well as processes must be considered.

124. List and describe at least four ways that information systems can support total qualitymanagement. Which do you think should be implemented first?

Simplifying the product or the production process

Benchmarking

Use customer demands as a guide to improving products and servicesReduce cycle time

Improve the quality and precision of the design

Increase the precision of production

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125. Of what does systems analysis consist? What does the systems analyst do to achieve thesegoals?

It consists of defining the problem, identifying its causes, specifying the solution, andidentifying the information requirements that must be met by a system solution.

The system analyst creates a road map of the existing organization and systems, identifyingthe primary owners and users of data in the organization. From this organizational analysis,the systems analyst details the problems of existing systems. By examining documents,work papers, and procedures; observing system operations; and interviewing key users of thesystems, the analyst can identify the problem areas and objectives a solution would achieve.Often the solution requires building a new information system or improving an existing one.

The systems analysis itself would include a feasibility study to determine whether thesolution suggested would be achievable from a financial, technical, and organizationalstandpoint.

126. List and describe at least nine factors considered in the design specifications for a new

system. Give at least two examples for each one.

Output medium, content, timing

Input origins, flow, data entry

User interface simplicity, efficiency, logic, feedback, errors

Database design logical data model, volume and speed requirements,

organization and design, record specifications

Processing computations, program modules, required reports, timing of

outputs

Manual procedures what activities, who performs them, when, how, where

Controls input controls, processing controls, output controls, procedural

controlsSecurity access controls, catastrophe plans, audit trails

Documentation operations documentation, systems documents, user

documentation

Conversion transfer files, initiate procedures, select testing method, cut over

to new system

Training select training techniques, develop training modules, identify

training facilities

Organizational changes task redesign, job design, process design,

organization structure design, reporting relationships

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127. Describe the processes, considerations, and problems involved in testing the new system.

Testing answers the question, Will the system produce the desired results under knownconditions? The amount of time needed to answer this question has been traditionallyunderrated in systems project planning. Testing is time-consuming: Test data must becarefully prepared, results reviewed, and corrections made in the system. In some instances

parts of the system may have to be redesigned.

Three activities are involved in testing and information system:

Unit testing consists of testing each program separately in the system. The

objective is not to guarantee the programs are error free (which isimpossible), but to locate errors in the programs, focus on finding all theways to make a program fail, and correcting problems.

System testing tests the functioning of the system as a whole. It tries to

determine if discrete modules will function together as planned and whetherdiscrepancies exist between the way the system actually works and the wayit was conceived. Among the areas examined are performance time, capacity

for file storage, handling peak loads, recovery and restart capabilities, andmanual procedures.

Acceptance testing provides the final certification that the system is ready to be

used in a production setting. Users and management review the systemstests. When all parties are satisfied the new system meets the standards thesystem is formally accepted for installation.

128. What are the advantages and disadvantages of prototyping? Describe the steps inprototyping. Give at least two circumstances under which prototyping might be useful.

Prototyping is most useful when there is some uncertainty about requirements ordesign solutions. It is especially useful in designing the end-user interface. Because

prototyping encourages intense end-user involvement throughout the process, it ismore likely to produce systems that fulfill user requirements. Working prototypesystems can be developed very rapidly and inexpensively.

Rapid prototyping can gloss over essential steps in systems development. If thecompleted prototype works reasonably well, management may not see the need forreprogramming, redesigned, full documentation in testing to build a polishedproduction system. This can backfire later with large quantities of data or largenumbers of users in a production environment.

The steps in prototyping are:

Identify the users basic requirements

Develop an initial prototype

Use the prototype

Revise and enhance the prototype

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129. List the identifying features of each of the five systems development approaches.

Systems lifecycle sequential step-by-step formal process, written specification and

approvals, limited role of users

Prototyping requirements specified dynamically with experimental system; rapid,

informal, and iterative process; users continually interact with the prototype

Applications software package commercial software eliminates the need for internally

developed software programs

End-user development systems created by end users using fourth-generation software

tools, rapid and informal, minimal role of information systems specialists

Outsourcing systems built and sometimes operated by an external vendor

130. Describe the object-oriented development approach. Why is it considered best forapplications involving the Internet?

This approach to systems development uses the object as the basic unit of systems analysis

and design. The system is modeled as a collection of objects and the relationships betweenthem.

In the digital firm environment, organizations need to be able to add, change, and retire theirtechnology capabilities very rapidly. Companies are adopting shorter, more informaldevelopment processes for many of their e-commerce in the business applications, processesthat provide fast solutions that do not disrupt their core transaction processing systems andorganization databases.

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