Successful Information System Projects - Literature review Example

Case Study about Successful Information System Projects Introduction Information has become a central part of any organization. This applies for all sorts of organizations ranging from government institution, private profit-driven institutions as well as nonprofit organization or NGOs. As a result, information has become a central part of the organization (Khan, 2010). This means that an organization that is able to capture, store and utilize information in a competitive way will have the best chance to succeed. However, this requires information systems. The process of acquiring an informing system that will serve the organization well and help it achieve its goals is not an easy process. More often than not, the projects can fail regardless of how much financial resources the organization has invested in the project. There are however some guidelines that are important in trying to avoid project failures. System analysis Carrying out a well planned and scheduled system analysis is a very good way to avoid project failures. As Graham (2013) argues, most projects failures can be attributed to lack of good system analysis that was done. System analysis refers to investigating the informational needs of the organization to determine its informational needs and then developing an information system that is geared towards serving these needs. This process involves a number of actions as follows; Communication with users As Pinto ( 2011) says, involving the end users is a helps in avoiding system failures as it reduces user resistance. These end users have a crucial role in the success of IT projects. Their involvement will determine how the system acquisition process will be successful as well as the end product. Failure to involve the users leads to a number of issues that threaten to stop the project on its track. These are as follows; User resistance Although information technology has been there for a long time, many people in many organizations still have the phobia against IT. Not only does IT mean that the users will have to learn new skills, it also poses a threat to their job (Pinto, 2011). Whether this threat is real or perceived, it will make the users to feel that the system is going to affect them in a negative way. This phobia arises from the fact that people are generally afraid of change because change removes them from their comfort zone. Change also brings the unknown and people are also afraid of the unknown. However, project managers do not have to deal with the issues of user resistance, as long as they are able to understand the factors that bring about this user resistance and deal with them in the right manner. The users need to be well informed about the new project, what it is supposed to achieve and how this is supposed to be achieved. The users also need to be informed on how their contribution towards the project will help in achieving this (Schwalbe, 2009). One of the main mistakes that many project managers may make is the belief that only managers need to be given the full detail of the system and that subordinate employees are not necessarily in need of being informed. This does not always happen and in most cases the users want to know what is going on. The users should be informed about the new project, why it is necessary for the firm to undertake the project and how and when it will happen. In most cases, involving the users is a matter of reassuring them about their interests (Khan, 2010). User needs misfit The system analysis should also be geared towards making sure that the information needs of the firm are understood and then met through the acquisition of the system. As such, regard, the best way to comprehend these needs is to actually talk with the end users of the system (Gido, 2012). If the system about to be acquired is a functional-level system which means it will be used by the subordinate employees, they will have to be asked about their information needs. This involves working closely with the users and understanding what it is that they do on a daily basis then finding an easier way of doing the same through the system. As Pinto (2011) says, if this is not done, the system will not be able to align to the strategy of the business. This will in turn mean that the system may have problems. If the system that the firm acquires is not aligned to the needs of the users, it will risk the failure of the system, or at the very least mean increased cost of tuning the system until it eventually meets the needs of the users. These needs can be captured with the very first attempt if the system analysis focuses on the user needs. Avoiding technology hype Technology hype refers to the technology that is possible technically but that does not have a direct application to the firms information needs. As Moraveck (2013) argues, the fact that a certain technology, or technical functionality exists does not meant that it is going to be useful to the organization. Although technology hype was a main problem in the early days of the technology, it still affects many firms today. This happens when an organization buys a system from vendors whose main business is to sell systems. In this regard, before a firm buys a system it is necessary to know its needs and know what technology best serves this need. Technology hype can be explained by the many technology gadgets that people own in their home but that they never use. In such a case, even though these gadgets have technical capabilities to do something, they fail to find a use in that the user can use them for. This same case applies for system acquisition; if the managers are not careful, they may end up with a system that is technically perfect but which does not help the firm in any way. Dealing with this issue requires communication. The technology onion is a technology analogy that looks at technology as a bulb onion. A bulb onion has many layers wrapped around each other and to access the useful part of the onion, one ahs to remove one layer after the other until one finds the best part. This is the same with technology because having a good system analysis will also help the firm to deal with the technology hype and avoid it successfully. Avoid strategic misfit Strategic misfit refers to the misalignment between the capabilities that the IT provides the firm with and the strategy of the firm (Gido, 2012). For an IT system to be successful to an organization, it must be able to provide the capabilities that will help the firm to implement its strategy. The strategic misfit is also another issue that can be addressed using a system analysis. Strategic misfit also leads to cost overrun and it is the main source of such cost overruns. It also occurs when the firm is not willing to do an information system analysis to avoid the technology hype. In such case, the organization acquiring the system will end up with a product that fails to align with its strategy (Graham, 2013). This will hinder the firm from achieving its goals and in most cases such a system would have to be given up, usually at a cost. One thing to note about information systems is that they do not have a resell value and if bought, they cannot be sold. Unlike physical assets such as cars and buildings that can be sold later if the firm realizes that it does not need them IS systems cannot be resold and therefore, if the system proves to not align with the strategy of the organization, they become useless and cannot be disposed at a price (OCarroll, 2013). As a result, making sure that the system about to be acquired aligns well with the objectives of the organization is important in ensuring that the organization will not make a big loss. Involving other stakeholders The modern business environment is much more complicated than it was the case in the earlier days before information technology became a part of commerce. Business strategies are directly linked with the other stakeholders in the value chain (Moraveck, 2013). For instance, the suppliers may want to link their information systems to the business. When considering a system acquisition or a system upgrade, it is necessary to make sure that these stakeholders such as the suppliers and customers have been considered and that their informational needs have been identified and taken care of (Pinto, 2011). In case this is not done, then the system will introduce a disconnection in the organization’s business chain. This would render the system useless to the organization. It is crucial to guarantee that the system will help the firm to acquire a strategic edge. Cost overruns Cost overruns make the biggest risks that any organization trying to acquire a system has to take. It is impossible to mark the system in terms of the time and resources that will be needed from the start of the process to the time it will be completed. As Flyvbjerg and Budzier (2011) say, a great majority of system acquisition projects get an overrun of over 200%. This is a very high risk and in most cases, the firm has to either abandon the project or it will not be able to benefit from the project. According to Smith (2012), cost overruns are also as result of poor planning especially where these cost overruns are seen as normal and accepted as part of the business process. Several strategies exist that can be used to avoid cost overruns. First is the use of proper cost analysis to determine the cost of the system. Most cost overruns in IT projects are a result of poor system analysis. A good system analysis involves not only looking at the informational needs of the firm, but also at how much the system acquisition will cost the firm. Thus, it becomes difficult to have an estimation of the cost and it is therefore necessary to make sure that the variance will not be too high. Prototyping Prototyping is a very good way for managing the IS projects to deal with certain issues such as cost and making sure that the system is able to meet the information needs. In this case, the prototype can also be used to guarantee that there is no misalignment between the technology and the business strategy. Prototyping is important in the following scenarios; The business needs are not explicit Sometimes it is very hard for the informational needs of the firm to be known at the beginning. Prototyping can then be used as a way to capture these needs as the project goes on. With every cycle in the prototyping process, new business needs are identified and then included in the next prototype. This is done until all the business informational needs are understood fully. The benefit of this is the fact that the business needs will be captured by the process. Prototyping is also a good way to ensure that the consumers are part of the process of acquiring a system and this is important in guaranteeing user support and avoiding user resistance. This is because each prototype is used by the users and their opinions and concerns recorded as they use the system. Their feedback is then included in the next prototype and the process is reiterated until all the needs have been identified and met (Schwalbe, 2009). The cost of the project is not easy to estimate Prototyping can also be used as a way to help in dealing with cost overruns. The benefit with this is that the whole system is not implemented once but in bits. If the project proves to be costing too much, the organization can terminate the project as early as possible to avoid further losses (Sharma, 2013). Reference List Flyvbjerg, B. (2011, September 10). Why Your IT Project May Be Riskier Than You Think. Retrieved September 19, 2014, from Harvard Business Review: http://hbr.org/2011/09/why-your-it-project-may-be-riskier-than-you-think/ar/1 Gido, J. (2012). Successful Project Management. London, Uk: Cengage Learning. Graham, R. (2013). Creating an Environment for Successful Projects. Hoboken, NJ: John Wiley & Sons. Khan, A. (2010). Conceptual Design: A Critical Element of a Successful Government Financial Management Information System Project. Washinton, D.C.: International Monetary Fund. Moraveck, C. (2013). Unmasking Project Management: The Business Perspective of Information Systems Success. London, Uk: Palgrave Macmillan. OCarroll, P. (2013). Public Health Informatics and Information Systems. New York, NY: Springer Science & Business Media. Pinto, K. (2011). Successful Information System Implementation: The Human Side, Page 659. New York, NY: Project Management Institute. Schwalbe, K. (2009). Information Technology Project Management. London, Uk: Cengage Learning. Sharma, K. (2013, June 20). Learning from the Qld Health payroll fiasco. Retrieved September 19, 2014, from Business Spectator: http://www.businessspectator.com.au/article/2013/6/20/technology/learning-qld-health-payroll-fiasco Smith, P. (2012, March 01). Report slams Victoria Police IT. Retrieved September 19, 2014, from Finacial Review: http://www.afr.com/p/technology/report_slams_victoria_police_it_8BObbrmARC8WboYENldDLP Read More