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

MGMT 6180 - © 2012 Houman Younessi

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:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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.

Strategic Information Systems Planning Process

The Planning Cycle:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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.

Strategic Information Systems Planning Process

The Planning Cycle:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Strategic Information Systems Planning Process

The Planning Phases:

Phase 1: Visioning

Phase 2: Analysis

Phase 3: Direction

Phase 4: Recommendation

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Product

Process

Enterprise

Environ.

Quality

Efficiency

Effective-

ness

Susta

in.

Demand Side

Supply Side

Demand and Supply

Aggregate Demand and Aggregate Supply

Strategic Information Systems Planning Process

Back to our business modelThe Process, Efficiency, Supply Stage

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Element Concept Information Category Information System

Cost Production Process capabilityTechnology

Forecasting EstimatingOptimizationControl

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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.

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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.

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Objective One:

Minimization of cost for a given output

Short run

Long run

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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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MGMT 6180 - © 2012 Houman Younessi

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Production Control:

Eliminating Waste

The six wastes:

Over-production

Inventory

Motion

Time (wait-time)

Processing

Rework

Objective Two: Minimization of cost for total output

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Various Key terms:

• Lean

• Six Sigma

• Kaizan

• TQM

• CMMI

• ISO 9000

• BPR

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Design:

Principles of Good Design

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

• 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

ofof

GoodGood

DesignDesign

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

• 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

PrinciplesPrinciples

ofof

GoodGood

DesignDesign

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

• 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

PrinciplesPrinciples

ofof

GoodGood

DesignDesign

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

AND OF COURSE MOST IMPORTANTLY

Design for maximal process efficiency

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

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Over-production

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Inventory:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Motion:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Time:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Processing:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

Rework:

Lecture 4

MGMT 6180 - © 2012 Houman Younessi

EXERCISE:

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