Organizational and Technical Issues in the Management of Information Systems - Research Paper Example

Abstract Information systems (IS) help organizations become competitive. However, several risks exist threatening to fail the IS; risks from development and implementation, organizational culture, technical considerations, human resources, and business practices. A large number of IS have failed as the organizational culture, business practices and human resources and IS have not been synchronized. Other issues include stakeholder involvement, information security, and development of organizational competencies. Good practices include the use of tools for improving system effectiveness and efficiency. A fit between the organizational culture, business practices, and human resources are vital for IS success. This includes consideration of stakeholder views, prudent management practices, collaboration and communication. The approach for the development and management of IS should be comprehensive. A comprehensive approach is required for the development, implementation, integration and management of information systems. Appropriate tools and practices are required for the successful management of information systems. Introduction Businesses need to invest in Information Technology (IT) to remain competitive and increasingly sophisticated. IT has enabled new businesses to enter the market by strengthening and stimulating the paradigm for global competitiveness, while forcing existing businesses to re-evaluate their IT operations. As a response to changing business environments, and the aim of improving organisational performance and remaining competitive, businesses have made investments in IT systems. Information systems (IS) provide managers with support systems for decision making while planning, organizing and controlling systems. They contribute to budget control, meeting of deadlines, and fulfilling technical specifications (Raymond & Bergeron, 2008). However, over 60 percent IS systems have been failures (Goepp et al., 2008). Knowledge of people and organizational issues in the implementation and management of IS has been growing (Ash et al., 2008). Risks to IS The benefits of IS are difficult to quantify. Gunasekaran et al. (2001) examined intangible benefits such as competitive advantage and tangible benefits such as securing future businesses to develop a model for the evaluation of investment in IS. In the context of several stakeholders, implementation of information systems is likely to be disappointing and troublesome, if stakeholders are not identified and their interests not taken into consideration (Boonstra & de Vries, 2008). A “fit” between organizational characteristics and business processes embedded in the system affects the likelihood of implementation success or failure (Morton & Hu, 2008). Management of information security has been a challenge, as it has been neglected and skills needed for organizational culture have not been adopted (Ashenden, 2008). Chen et al. (2009) studied investment risks in IS and found that public risks had an upward effect on expected payoff, while private risks influenced the value of options. Yeo (2002) proposed a triple-system model comprising of strategic planning and delivery process, organizational context, and a formalized technology-enabled information system for the analysis of failures in IS. Pan et al. (2008) integrated sequential mapping of project events with the ‘Exchange Model’ for identification of evolving recursive interactions in IS failures. Project organization, information system and its supporters were IS implementation components that were considered. According to Ranganathan & Kannabiran the role top management, CEO-CIO relationship, structure of the IS department, and IS planning and implementation are parameters that determine the ultimate effectiveness of IS s (2004). IS frameworks are becoming increasingly popular for benchmarking management positions and assisting with the anticipation of an uncertain future. Study of IS issues could be classified into the following frameworks (Shi & Bennett, 2001): 1) frameworks for identification, which identify issues in IS management in different contexts; 2) frameworks for comparison, which compare critical IS management issues frameworks perceived by various groups of IS personnel; 3) frameworks for analysis of trends, which analyse key issues and historical trends with regard to their increasing or decreasing importance; and 4) frameworks for examination, which examine factors and attempt to understand influences of these factors on the perceptions of IS management issues among IS personnel. Despite significant progress in IS implementation techniques, there could be problems such as delay, budget overruns, substandard performance, or complete failure while implementing IS. The immense complexity and scale of systems require high quality management in addition to technical excellence to deal with systems. Managers must be able to deftly identify systems and act promptly for solving them (Chu, & Bannister, 1992). IS often fail to meet pre-specified objectives including, scope, time and budget. Managers perceive risk management processes ineffective in the management of risk. Environment-related and decision maker-related conditions lead managers to deny, avoid, delay and ignore dealing with risk. The resulting consequence of these actions is an adverse influence on the perceived effectiveness of risk management, and outcomes (Kutsch & Hall, 2005). Pre-project preparations include an understanding of requirement specifications, contractual relationship, scope and constraints (budget, technology, interfaces, etc.) of the project, and business environment. There is a significant amount of risk if the scope of the project is not properly defined. Internal organizational politics could aggravate the problem. Lack of information and communication technology could result in undue optimism and overambitious expectations post development. Poor management of the project has been the major cause of failure in IS projects. Risks have been identified around three areas namely human resources; project planning and project monitoring and reporting. This includes deficiencies in the planning of projects and team building. A comprehensive project management strategy should be initiated as soon as possible. Communication channels that link managers, teams, customers and end-users are necessary to ensure flow of information and feedback. The plan should include formally defined and agreed milestones and deliverables. Research suggests that reporting and failure to document project progress contributed to failures of projects (Zhou et al., 2008). Organizational Issues Implementation of IS often involves reengineering of business processes. Radical changes my occur causing IS to be unsuccessful. Factors such as egalitarian culture, resource management, resistance management, and change management have been considered organizational enablers. The management of these factors could increase the success of IS (Wells, 2000). Organizations should be able to evaluate implications of knowledge management (KM) within their technical infrastructure, and identify the role of tools in the flow of knowledge in organizational processes (Rodríguez-Elias et al., 2008). KMS designed to support specific goals are more appropriate, as knowledge problems are divergent across organizations (Hahn & Wang, 2009). The quality of information and system integration were found to influence usefulness of IS; which was a good predictor of extended usage (Saeed & Abdinnour-Helm, 2008). While developing IS, business processes and supporting databases should be closely related (van Hee et al., 2009). Organizations seeking to improvement systems performance have implemented a variety of methodologies with mixed results. Procedures, definitions, and policies required to reduce the uncertainty and equivocality associated with the management of IS could be successful only when management of the process allows complete utilization of those mechanisms. Some organizations experienced on-time project completion within budget, and improved productivity (Jones & Kydd, 1988). Human Factors The inability of the IS to satisfy expectations of stakeholder group is an IS failure. Lyytinen demonstrated that perceptions of systems analysts’ were based on their professional and structural position in the systems development process and associated interests, supporting the view that IS failure was stakeholder-dependant (Lyytinen, 1988). Group problem solving approach has a positive influence on IS development and implementation (Tesch et al., 2009).Yen et al. found that the implementing team created higher level of integration and effective management of systems within the organization, influencing the success of IS (2008). Involvement of users and designing models of an integrated enterprise are necessary in the development of IS (Goepp et al., 2008). Development of organizational competencies helps in harnessing IT, and gaining competitive advantage (Dhillon, 2008). Technical Issues Harman and Koohang (2006) explored the extent to which diffusion of concepts related to IS; rate of approximation by the management; and frequency distribution that reflected the diffusion of innovations. It was found that the cumulative frequency distribution approximately resembled the S-curve of adoption, and the rate of adoption was exponential. This corroborated the epidemiological model of the rate of adoption reported in various literature. Innovation diffusion referred to the adoption or implementation of ideas, processes, products or services that were new. Help desk has been defined as an accessible service point to provide on-demand service, information or action for aiding the user carry out an IT-related task. The role of help desk could be extended to be that of a facilitator of technology that could be achieved by the gathering and analysis of data to manage end-user technology proactively. Help desk had three essential characteristics: centralized or multiple help desks; staff; manning by experts or staff with basic knowledge. Some of the common applications of help-desk information were to highlight training needs, identify common causes of problems, or provide information for sales teams. Support functions were facing an explosion in the use of IT and variety of software and hardware use; organizational restructuring and fragmentation of IT; eliciting support from technical and support groups were operationally discrete; lack of information about new products from development groups; resourcing; service definition and monitoring; and advice or lack of direction on developing the service. Help desk is seen as a business function rather than a technical function, and should align itself accordingly (Marcella & Middleton, 1996). IS security has been defined as the minimization of vulnerabilities of assets and resources by the International Standards Organization (ISO). The core of security related activities is the risk management process. The process of risk management involves anticipating possible impacts and inclusion of safeguards before incidents take place. The risk management process has been illustrated in figure 1. Modelling for IS security requires consideration of reality, and the perception of this reality as perceived by others. Perception by humans is driver by a variety of factors, including perception of risks, adaptation of processes related to risks; and security related activities as a consequence of perceived risks. IS are characterized by the complex interplay between human resources and technology, which gained prominence with the penetration of internet in private and business sector. Factors such as cognitive processes of participants; communication skills; dynamic social processes; experiences, etc. drive the interplay between human resources and technology (Trcˇek, 2006). Technological issues identified were stability and compatibility of hardware and software problems that caused a majority of failures. Unproven or unfamiliar technologies could cause disappointment leading to under-performance or conflicts with expectations of technology that are unrealistic. Technological development infrastructure with unfamiliar programming languages, tools for development and development methods could result in risks. Design and development methodologies could result in project structures and risks. Differences between agile and structured methodologies are well known. Selecting a methodology based on fashion could increase risks to projects and increasing the probability of failures. The focus on design and programming lead to reductionist measures on requirements and functional specifications, requirements, organizational constraints and end-user needs. Customer requirements on designs and prototypes before starting the process of programming could reduce the probability of rejection of the final system. Adequate testing and programming methods and techniques should be adopted. For example, the use of software or hardware platforms that are incompatible could present a significant risk to the project. While thinking in terms of risk and assessment, it is desirable to prepare a checklist that serves as an important decision-making tool for the reduction of risk (Zhou et al., 2008). Competitive advantage could be gained by fast response, and has spurred rapid exchange of online information in supply chains. This requires managers and other operational actors make decisions rapidly (see figure 2). Aspects of knowledge management for are knowledge capture, knowledge retrieval, knowledgebase maintenance, and skill or knowledge engineer. Learning systems in support of real time knowledge management around business processes include on-the-fly capture of knowledge; accommodation of changing solutions, including solutions with fuzzy or incomplete knowledge; knowledge structure that is self-organizing; and word structure of problem/solution/symptom is intuitive without any special skill requirement (see figure 3). Issues with traditional expert systems include inadequate time spent on building working rules and cases; not suited to solutions-in-progress requiring large number of cases for problem-solving; large effort to maintain rules that keep on changing with large number of cases; and requires skilled knowledge engineers to translate knowledge to rules and develop expert systems (Sawy & Majchrzak, 2004). Business Practices Failures in IS have been attributed to incorrect market positioning, inadequate business and risk strategies, poor decision making based on inadequate information or without authorization. Absence of risks limits that have been clearly defined, reports that have been deliberately misleading, inadequate communication within the organization with regard to vulnerabilities from risks, lack of proper risk control, inadequate knowledge of business environment, and lack of timely decision making aggravate a disadvantageous situation. This results in stakeholders such as shareholders, and other corporate entities being deprived of valuable information. This requires more comprehensive and reliable risk systems as they relate to IS. However, before embarking on the management of strategies for the management of risk, these risks need to be identified. Risk has been defined as the event that has possibility of occurrence and could negatively impact IS. Risks could stem from the nature of work, type of resources, contractual ownerships in place, or from other political and social factors that influence the project. Procedural aspects of management processes include estimation, planning, monitoring, team building and management of change. Technical aspects of IS development include specification of requirements, abstract representation of IS environments and human activity systems, programming, testing and installation. Different business cultures support or hinder IS to some extent. Organizations could be classified as innovators, follower, or dinosaur. Innovators actively pursue the development of IS, and concentrate on competitive information and analysis. Follower concentrates on efficiency of operation for ensuring competitive pricing and reduced costs for competing with competitive businesses. IS are less dynamic and are tightly controlled. Types of systems include operational management systems; materials flow; or stock management with limited buy/supply functions. Dinosaurs rarely invest in IS, but if they do, they concentrate one or more from the above discussed systems to move out of their niche. Complexity of IS depend on the level of decision making required. Management of information includes three levels: strategic, tactical and operational. Strategic ISs are required by senior management for directing the organization. IS are sophisticated and expensive with an orientation around markets, competition and demographic analysis. Tactical ISs are required by middle-tier management tor implementation strategies. Information requirements include assessment of performance, resource utilization, and short-term forecasts. Operational ISs are required by junior management to manage daily functions. Such systems are detailed and derived from operational data. Strategic objectives of IS strategies depend on varying factors within the organization including political and financial circumstances. Often businesses follow a pragmatic path that changes as the organization grows, and cultural habits of the management change. Sometimes ISs include the “bottom-up” strategy with support to specific functions. Other functional systems are integrated as the needs grow. The “top-down” approach includes total system planning with a vision to support the functions of the whole organization (Williams, 1997). Good Practices Requirements engineering and management (REAM) includes the process of discovering, documenting and managing requirements with principal activities that include eliciting, understanding, negotiating, describing, validating, and the management of requirements. Developers of IS could benefit from this technique to overcome delays, cost overruns, and omission of pre-specified features (Carr, 2000). Systems such as system management information systems could enhance system planning, scheduling, monitoring, and control resulting in system effectiveness and efficiency. Raymond and Bergeron (2008) concluded that the use of such systems has a direct impact on system success, by contributing to improvement in budget control, meeting system deadlines, and fulfilling technical specifications. External Technology Integration (ETI) includes the process of management and acquisition of technology from external sources. ETI is an important activity in the complex process of systems development, process development, and operational improvement. The ETI activity is often dealt in an ad hoc manner. Successful implementation of IS could be accomplished by purposeful and structured management of the ETI process (Stock & Tatikonda, 2004). The introduction of IS should include formulation of effective change management strategies. This requires an integration of concepts and practices from disciplines such as system management, organizational innovation, and change management theory and practices. The effective management of changes in a sociological context involving economic and technological terms is a requirement for success. Change management strategies include pre-implementation, implementation, and post-implementation of systems. Acceptance of IS has been associated with innovation and diffusion of innovation. The post-implementation strategies are critical for system success, as the users determine the success of IS, when the systems are in use (Kuruppuarachchi et al, 2002). Portfolio Management (PM) includes the development or deployment of software tools to assist and automate the process, with the aim of effectively managing resources and risk. Reyck et al. (2001) concluded that adoption of PM resulted in the reduction of ISs related problems, and improvement in performance. Mills and Merken (2004) suggested the use of a mixture of techniques comprising of a multi layer evaluation process derived from balanced score card, eliminating the weaknesses of individual techniques. Researchers have found IS user participation beneficial in outcomes. Vadapalli and Mone (2000) studied integrated user participation comprising of combination of steering committees, cross-functional teams, and system champions who performed various functions providing support to each other during IS implementation. They found that various organizational behaviour and human resource management issues on user participation structure influence IS outcomes. Communication and collaboration are important in the development, implementation and management of IS. The broader social and organizational context has a profound influence in the use of IT. The use of groupware could result in positive effects, as there are significant forces that counter new developments to maintain the status quo (Olesen & Myers, 1999). Group problem solving interaction leads to greater system success to a certain extent. However, when the exchange of information is not so essential, knowledge redundancy is high (Tesch, 2009). One of the factors influencing IS success is the end-user’s behaviour. The ability of end-users and willingness to work with newly introduced software applications is fundamental. It is important to target employees of newly introduced software applications for their proper utilization. Such support could be provided by HRM practices. Ensuring that employees are able to operate new IS, provision of opportunities to work with new IS, and removal of obstacles for the use of new IS are three domains that HRM practices should focus on (Bondarouk & Ruël, 2008). Team leaders could avoid engaging in behaviours by being aware of implications and impact of behaviours that could be viewed negatively, and be more effective in their roles. Cervone (2008) has suggested that it is not advisable to be a control freak, to be disengaged, to be a shill for anyone, ignore technical prowess or being a “geek out,” trying to effect change overnight, fall prey to “resourcification,” or pass off “collaboration.” Standing et al. (2006) concluded that junior IT professionals attributed success to them and attributed failures to external factors, while executive management took a more balanced view. This view of system stakeholders is useful in the management of risks to systems. System managers should develop clear system vision; work with team members supporting the vision; maintain, safeguard, and make changes as necessary, establish clear system deadline, track system progress, foster stage-gate development progress, promote communications, facilitate documentation, and increase team cohesiveness. Effective management of these practices increases the probability of success (Akgun et al., 2004). Stakeholder’s perceptions, expectations and interrelationships during the management of ISs are important factors in the strategic management of stakeholders (Pan, 2005). Bakker et al. (2009) concluded that stakeholder perception of risk and success, and stakeholder behaviour are key elements in the management of risk and system success. Escalation and de-escalation of commitment in IS are processes involving recurring instances of approach-avoidance conflict. Conceiving these as sequence of events help managers develop a deeper understanding of how and why systems escalate and de-escalate (Pan et al., 2006). Conclusion A large number of IS have resulted in failure as there has been a lack of “fit” between the organizational culture and IS design. Lack of synchronization of organizational processes and IS design; stakeholder involvement; information security; and development of competencies are issues in the development and management of IS. A comprehensive approach is required for the development, implementation and management of IS; organizational process centric design; stakeholder involvement; and development of competencies. Good practices include the use of tools such as requirements engineering and management, and portfolio management systems for improving system effectiveness and efficiency. External technology integration provides a smooth transition during acquisition of external technology. 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Zhou, Lihong, Vasconcelos, Ana, & Nunes, Miguel (2008). Supporting decision making in risk management through an evidence-based information systems project risk checklist. Information Management & Computer Security, 16(2), 166-186. Appendix A: Figures Figure 1. Risk Management Process (Trcˇek, 2006) Figure 2. Vigilant Information Systems (Sawy & Majchrzak, 2004) Figure 3. Global Flow of Information (Sawy & Majchrzak, 2004) Read More