Lecture 4 MGMT 6180 - © 2012 Houman Younessi Strategic Planning for IS and IS toolkit.

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Strategic Planning for IS and IS toolkit

Lecture 4


The planning process is the interventional participation of the planner as an expert whereby the fact-finding and intervention by the planner is for the practical purpose of improving the problem situation.

In a way, many pure consulting assignments may be classified as a form of this kind of planning.

Therefore the validity of the plan, or the outcome is not based so much on the factual replicability and validity but the usefulness of the action in having improved the situation.

Strategic Information Systems Planning Process

The Planning Process:

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1. Planning starts with the identification of an initial problem in need of improvement. Then we proceed to;

2. Find facts through interventional investigation of the problem situation, we then;

3. Form a general “action plan”. A plan for forming general hypotheses, gathering information about them, improving them, etc. We then go on to;

4. Implement the action plan. This brings forth a number of findings, potential problems, areas of potential improvement, etc.


The Planning Cycle:

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5. Interpret the situation and intervene to improve it. At the same time we;

6. Revise the plan and continue on the next cycle of intervention until no further intervention is required as the situation is deemed as having sufficiently and successfully improved.


The Planning Cycle:

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The Planning Phases:

Phase 1: Visioning

Phase 2: Analysis

Phase 3: Direction

Phase 4: Recommendation

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Product

Process

Enterprise

Environ.

Quality

Efficiency

Effective-

ness

Susta

in.

Demand Side

Supply Side

Demand and Supply

Aggregate Demand and Aggregate Supply


Back to our business modelThe Process, Efficiency, Supply Stage

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Element Concept Information Category Information System

Revenue Demand Market trends and marketingProduct qualityPricing

Data Acquisition Data AnalysisControlForecastingOptimization

Cost Production Process capabilityTechnology

Forecasting EstimatingOptimizationControl

Risk Uncertainty Economic EnvironmentInternal control

ForecastingControl

Longevity Sustainability EnvironmentIntegration and systemicity

ForecastingOptimization

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Element Concept Information Category Information System

Cost Production Process capabilityTechnology

Forecasting EstimatingOptimizationControl

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Production Function:

Production function is the specification of the (usually minimum) input requirements needed to produce designated quantities of output, given a certain production technology.

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Isoquant: Isocost:

A function that shows all possible quantities of inputs that result in the same level of output with a given production function.

All combinations of inputs (e.g. labor and capital) into the production function that can be obtained for a fixed outlay.

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Objective One:

Minimization of cost for a given output

Short run

Long run

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Understand:

• Definition of cost

• Time frames

• Nature of change of cost over time

• Cost time and output time matching

• Relationship of cost to output

• Production Control

• Technology Impact

• Economies of scope

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Sources of Data:

Historical -Time series

Cross-sectional - Others in the sector or industry

Model-based or Predictive - Based on scientific observation

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Relationship of cost to output:

Production Control (to be discussed later)

Technology Impact

Production Technology Change - Innovation

Process Technology Change - Process Maturity

Process Improvement

Common Cause Special Cause

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Production Control:

Eliminating Waste

The six wastes:

Over-production

Inventory

Motion

Time (wait-time)

Processing

Rework

Objective Two: Minimization of cost for total output

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Some Examples:

Lot size optimization – interplay between set-up cost and inventory carrying costs

Return to scale – Form of the relationship between input and output

- Sub-linear

- Linear

- Super-linear

Output Elasticity

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Various Key terms:

• Lean

• Six Sigma

• Kaizan

• TQM

• CMMI

• ISO 9000

• BPR

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Design:

Principles of Good Design

Specific characteristics for each artifact would be different but they need to be identified and measured.

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• Understand your enterprise• Design for functionality• Design for reliability• Design for usability• Design for maintainability• Maximize cohesion• Minimize coupling• Use “models” to design systems• Use abstraction• Prioritize, work on high-risk entities first• Design a good interface• Produce “satisficing” designs

PrinciplesPrinciples

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GoodGood

DesignDesign

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• Do not optimize early• Maintain an updated model of the system• Develop stable intermediates• Use evolutionary development• State “what” not “how”• Specifically identify all functional

requirements• Allocate each function to only one

component• Do not allow undocumented functions• Provide observable states


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GoodGood

DesignDesign

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• Employ rapid prototyping• Develop iteratively and test immediately• Create libraries of reusable entities• Use open standards (unless intentionally

otherwise)• Identify things that are likely to change

• Document possible design deviation points

• Maintain a glossary of relevant terms

• Create measurable design margins

• Search for unintended consequences

• Change the behavior of people


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GoodGood

DesignDesign

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AND OF COURSE MOST IMPORTANTLY

Design for maximal process efficiency

Beware of, and design against the six enemies of process efficiency

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Over-production

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Inventory:

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Motion:

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Time:

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Processing:

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Rework:

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EXERCISE:

Determine an efficient process for the product you positioned last week.

Lecture 4 MGMT 6180 - © 2012 Houman Younessi Strategic Planning for IS and IS toolkit.

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