Planning and managing the information system – a
manager’s guide
It is no longer enough for
information systems (IS) to
support the operation. Infor-
mation systems should be
developed as part of the
strategic plan of the organiza-
tion. We first must recognize
the culture and the financial
position of the business
before assessing whether an
IS is worth investing in;
together with the information
technology (IT) department
we must take into account
what technical support we
already have and if we can
make enough use of it. Plan-
ning must be well structured
but on assessing various
planning methods we find
that this task is best handled
by experienced teams that
may consist ideally of IS staff
and management combined.
Information systems are
costly and slow to develop so
we must plan well and in line
with the strategic policy of
our business.
Industrial Management &
Data Systems
97/5 [1997] 187–191
© MCB University Press
[ISSN 0263-5577]
L.T. Williams
Principal Lecturer, Information Systems, Leeds Metropolitan University, Leeds,
UK
Introduction
Information is a corporate resource of such
critical importance that a directed strategy
for its development and management is
essential.
To plan effectively an organization needs to
know its present position, its strengths and
weaknesses, those of its competitors, market
trends, etc. All this presupposes a developed
management information system. To this
end, the development of information systems
must be developed from its primary source of
strategic planning objectives.
The key resource that we should be trying
to develop, however, is knowledge and there-
fore an understanding of user behaviour and
user requirements in differing situations
must be incorporated into any analysis of
information system needs.
It is no longer enough for information sys-
tems to support the operation of the business,
they must contribute to the revenue as well.
Information managers must therefore under-
stand the long-term planning of the business
on which they can develop their own informa-
tion system strategies, including the pur-
chase and use of suitable information tech-
nology to help achieve these goals.
The danger of investing in the wrong tech-
nology is that it can have a disastrous long-
term effect on strategic planning and there-
fore it is essential that the proposed key tech-
nology identifies both the current value of
support and the future potential or limita-
tions that may result when changing business
situations are considered.
Similarly, investing in insecure systems
without suitable security, controls and risk
analysis can cause a number of problems:
from poor or non-operation of the system to
inaccurate data on which management deci-
sions are made and, with growing frequency,
stolen data to support competitors.
Furthermore most countries are now intro-
ducing legislation to protect data and to
enforce copyright of software and data files. It
is therefore essential that managers are at
least aware of the basic principles of security
and control and the process of risk analysis.
Information systems in context
Management information systems are inte-
grated, user-machine systems for providing
information to support operations, manage-
ment and decision making functions in an
organization.
This quote, from Davis and Olson (1988), con-
forms to the general view of systems people.
However, it must be remembered that infor-
mation is often created directly from the
“experts” own experience and initiative. As
Tricker (1982) stated,
Information systems strategies can be ran-
dom, inspirational or unarticulated
thoughts or can be the result of careful
analysis and detailed planning.
Marketing decision making, for example, has
often been considered beyond the help of the
computer information system as managers
have regarded their decision-making process
as an art. However with the pressures of
maintaining competitive advantage in an
expanding world market, it is becoming nec-
essary for marketing management to draw
heavily on more formal and controlled sys-
tems that rely on computers and database
software particularly.
Operations and financial management have
traditionally relied on formalized informa-
tion techniques even before the advent of
computing in order to develop more efficient
and effective processes in their environment
(often using operational research and statisti-
cal techniques to help the decision-making
process). Manufacturing, in particular, have
been at the forefront of information systems
development and their user managers have
readily adapted to the current plethora of
new technology systems.
Human resource management, like market-
ing, has been slow to use the full benefits of
information systems although they have
always relied on data files of personnel on
which to manage the human resource, albeit
to a limited extent.
The adaptability and previous experience
of both data processing management and the
user managers (together with the organiza-
tional structure, behaviour and internal
[ 187 ]
L.T. Williams politics) will be crucial to the planning and
Planning and managing the implementation of new systems.
information system – a We must realize therefore, when developing
manager’s guide an information system, that there are funda-
Industrial Management & mental contexts in which our analysis must
Data Systems be placed:
97/5 [1997] 187–191
The culture of the organization
We must accept that different business cul-
tures will support or hinder the information
systems development to some extent. If we
use the marketing nomenclature for different
corporate cultures, we can develop an infor-
mation system cultural hypothesis:
Innovator – is likely to need and actively
pursue the development of an information
system and not regard cost of investment as a
hindrance if the business wants to be ahead
of the competition. Such systems will concen-
trate on competitive information and analy-
sis; customer and market information and
analysis; research and development informa-
tion and modelling systems.
Follower – is likely to concentrate on effi-
ciency of operation to ensure competitive
pricing and reduced costs in order to compete
with the innovative business that it follows.
Thus, its information systems will be less
dynamic and investment will be tightly con-
trolled. The type of systems commonly
required are operational management sys-
tems, such as progress and control; materials
flow and stock management systems. Some
buying/supply analysis developments are
sometimes initiated as well.
Dinosaur – it is difficult to see such an orga-
nization investing in computer technology to
a great extent let alone investing in an infor-
mation system. Nevertheless, if they do invest
in such systems, they concentrate on one or
more of the above in order to move out of
their niche. Initially they try to save costs and
develop operational information systems
and, with growing markets, they select a
specific competitive strategy such as distribu-
tion systems, new product development or
market reduction analysis. In point of fact it
is rare for any of these systems to be devel-
oped and such businesses hang on for as long
as possible before dying or being taken over.
The business life cycle
Where a business resides on the life-cycle
curve (sometimes known as the bath-tub
curve and used for product management as
well as business development) will affect its
ability and its willingness to invest in sophis-
ticated systems (see Figure 1).
In simple terms, new and small businesses
will not have the inclination or, more impor-
tantly, the money to invest in information
systems development, whereas the mature
business will have both the capital and the
[ 188 ]
need (to counter diseconomies of scale and
growing competition) to invest in such sys-
tems.
Businesses on the upward incline will grad-
ually invest in information systems as they
develop their business and their profits. Such
systems tend to be operational information
gathering although those reliant on efficient
distribution or strong customer service will
develop tactical systems accordingly.
Businesses on the downward incline may
not have enough of the profits to invest in
information systems as they would like but,
nevertheless, to stay competitive they must
develop or strengthen their strategy. Such
systems can range widely from efficiency
measures through to wider market research
and new product analysis depending on the
new objectives set in strategic planning.
Levels of information and decision making
The complexity and investment of the infor-
mation system will also depend on the level of
management and decision making that is
required. In simple terms one can identify
three levels of management information:
Strategic – required by senior management
to direct the organization as a whole. Plan-
ning and decision making at this level is for
survival and prosperity. Such information
tends to be derived mostly from external
sources and thus information systems for
this level are sophisticated and expensive and
typically oriented around markets, competi-
tion and demographic analysis.
Tactical – required by middle-tier manage-
ment to implement strategies by selecting
appropriate tactics. This level of information
is concerned with current performance, uti-
lization of resources and short-term forecasts.
Information systems at this level can be
varied and use data from both external
sources and from internal sources depending
on the organization’s culture and stage on its
life cycle.
Operational – required by junior manage-
ment for day to day running of the functions.
This level of information will be very detailed
and derived from operational data mainly
from within the system. Some external infor-
mation may be required where customer
sales and service and supplier service are to
be analysed.
One should not forget also the internal
cultures in organizations which may also
modify and complicate the ideal system.
Thus, culture, life cycle and management
levels will therefore interact with each other
to form complex attitudes to information
systems that go against the logical flow of
development suggested by systems people or
information systems textbooks.
L.T. Williams
Planning and managing the
information system – a
manager’s guide
Industrial Management &
Data Systems
97/5 [1997] 187–191
Planning and selection
How should a business decide whether or not
to develop an information system and how
such a system will best support the manage-
ment requirements, at all relevant levels, and
their expectations for expansion/integra-
tion?
There are four main aspects to planning
and selection:
1 Identify the strategic objectives.
2 Identify the information systems to sup-
port them.
3 Analyse, in detail, the information sys-
tems requirements.
4 Allocate resources and budgets to sched-
uled projects.
Strategic objectives and information
systems support
There are a whole range of techniques and
methods to help identify and match strategic
objectives with information system strategies
but these approaches will also depend on
varying factors within the organization con-
cerned, including those discussed above.
As Avison and Fitzgerald (1988) suggest:
The particular strategy will depend on the
political and financial circumstances of the
organization.
In point of fact, if we look at research into the
most common approaches to planning for
information systems we can see that most
medium to large businesses follow a more
pragmatic path which alters according to the
organization’s financial growth and its man-
agement’s cultural habits.
Often information systems are planned and
developed over time starting with a piece-
meal approach supporting specific business
functions. This is known as “bottom-up”
development in systems terminology. As the
organization grows these functional systems
are integrated and later, with the growth of
data in the organization, are redeveloped
around a “data-analysis” and “database”
strategy.
The problem with such piecemeal develop-
ment is that there is no specific control to
ensure that the systems support the business
strategy.
However, the greater the integration and
database development, the more the systems
begin to consider strategic implications. This
is because data have a natural integrative
element, particularly when defining it for
database use but also, the allocation of bud-
gets for database development is usually
funded at a senior management level rather
than at specific functional levels and this has
the effect of integrating projects and thus
systems.
As the organization grows to maturity
(cash-cow business) it then, and only then,
begins to commit its resources to a “total”
system planning and development approach.
This is known in systems terms as “top-
down” development.
You can see therefore that information
systems planners and developers prefer the
latter approach as it ensures that all informa-
tion systems development must conform to
the terms of reference produced from top
management and therefore will support the
business strategy as a matter of course.
It can be seen that the underlying structure
for developing information systems in a more
formalized way enables senior management
to keep a tight and fundamental control on
systems development to ensure they conform
to the ongoing strategy of the business
despite the real world pressures on them.

Planning methodologies
Figure 1 Planning methodologies are often used to
The business life cycle support and strengthen the decision-making
process:
There are a whole range of approaches and
one should “pick and choose” those relevant
to one’s needs in the same way as if they rep-
Maturity resented a “tool-box” from which suitable
“tools” are selected according to the problem.
Growth Dying
Knight and Silk’s (1990) sector analysis is a
good example of such an approach which
Birth Death bases its process around the question, “How
can information systems help support the
Very high High costs Low costs Failing profits Shut down organization?”
costs Growing Good profits Increased costs Takeover
No profit profits (stable) Takeover Buy out The method facilitates discussion between
possibility, etc. strategic analysts and information systems
Key developers to enable both to develop a com-
How do we extend this? mon view of what the business is, where the
How do we prevent this? business is going (i.e. by looking at market
[ 189 ]
L.T. Williams trends and external pressures) and match the
Planning and managing the answers against a series of questions about
information system – a information systems in the organization and
manager’s guide where they are most likely to be needed.
Industrial Management & Questions derived from marketing analysis
Data Systems are typically used, such as:
97/5 [1997] 187–191
• Where are we?
• Where do we want to be?
• What are the new rules?
The ideas derived from these questions are
then used to develop detailed recommenda-
tions as to the information systems needed.
The information systems questions for con-
sideration are:
• How can information systems help?
• What are the information systems needs?
• What is the current and future information
systems market?
Rather than have an open-ended and unstruc-
tured discussion that is the case for sector
analysis, the use of frameworks can provide a
more structured and focused approach. Dif-
ferent frameworks can be selected based on
their relevance to the business and its future
direction.
They are commonly used as strategic plan-
ning tools but some can also be used to iden-
tify key objectives where information sys-
tems could support management strategies.
Earl (1989) proposed five strategy themes
for consideration:
1 Awareness frameworks – identifies our
market where market growth rate is com-
pared with market share. The most com-
mon version of this is the Boston Consult-
ing Group’s business segmentation grid.
From the outcome of this analysis, infor-
mation systems planners can identify
what levels of support they should develop.
Thus, if the focus is to be operational
strategies, such as increasing economic
return, then the proposed information
system should concentrate on efficiency
measures such as sales analyses, material-
flow control, customer service reports, etc.
If the focus is to be on improving competi-
tive position, the information system
should concentrate on market research,
demographic reports, new product devel-
opment, competitor analysis, etc.
2 Opportunity frameworks – seek to identify
areas of the organization that could be
developed to grasp an opportunity, such as
the use of their information database as a
product in its own right that could be sold
to market research businesses. Standard
business strategy methods are used to
identify such opportunities by using:
• value chains;
• application searching;
• information analysis.
[ 190 ]
3 Business strategy frameworks – assess
strategic impact on the business’s opera-
tion to identify whether the organization
could deliver its strategic solutions, such
as, competitive advantage, operational
efficiency, strategic postures, etc.
4 Positioning frameworks – are used to
assess strategic importance with regard to
internal support systems, such as, opera-
tional scale, temporal factors, spatial con-
siderations, etc. Strategic grids, for exam-
ple, could be used to match the strategic
requirements against the support mecha-
nisms in place in the organization.
5 Technology-fitting frameworks – identifies
specific areas of technology that could help
the organization meet its objectives. They
might identify an upgraded data process-
ing department or a new integrating net-
work facility to support operational effi-
ciency or they might select new directions
such as CAD/CAM or robotics to enhance
production and so on.
Analysis of information systems
requirements and project allocation
So far we have looked at the bridge between
strategic planning and information systems
planning. The next step is to break down
these information systems’ general require-
ments into projects which meet relevant
timescales, have a suitable proportion of
budgets and other resources allocated, and
carry out a detailed information analysis.
Once again there are well defined
approaches or methodologies (some incorpo-
rated in development software) that the infor-
mation systems developer can use. However,
as with the planning methods described
above, they do not always support the whole
range of tasks.
We can identify four stages in the process:
1 Planning the information systems – this
can be seen as concentrating on prioritiz-
ing the various possible systems, breaking
them down into “sets” for detailed analysis
with specific users and identify goals for
each “set”.
2 Analysing information requirements – this
analyses the information needs of the
relevant areas of the organization to assess
current data and future needs, to identify
boundaries and solve commonality of data
issues. In so doing a further outcome is the
reappraisal of current information sys-
tems and technology.
3 Resource allocation – the application of
standard business techniques to allocate
and control the financial and resource
allocation. Methods such as “chargeout”,
L.T. Williams “zero-base budgeting”, “ends/means
Planning and managing the analysis” can be used for overall allocation
information system – a and control as well as for individual pro-
manager’s guide jects.
Industrial Management & 4 Project planning – standard project plan-
Data Systems
ning is then applied to each individual
97/5 [1997] 187–191
project together with control of the final
integration of the whole system. Normal
project planning methods can used incor-
porating tools such as, “Gantt charts”,
“Milestone”, “Critical Path Analysis”, etc.
Conclusion
If businesses want to develop information
systems to support the ever changing strate-
gic process, they must invest in time and
money to develop the most suitable and effec-
tive system. Such a system should integrate a
number of interrelated functions and activi-
ties to ensure efficient reporting and analysis
of business and environmental transactions.
Whatever approach one takes, there must be
some formal structure to the planning and
analysis activities prior to development.
Information systems are costly and slow to
develop. It is therefore best to plan it right at
the start.
References
Avison, D.E. and Fitzgerald, G. (1988), Information
Systems Development, Blackwell Scientific.
Davis, G.B. and Olson, M.H. (1988), Structure and
Development, McGraw-Hill.
Earl, M.J. (1989), Management Strategies for Infor-
mation Systems, Prentice-Hall.
Knight, A.V. and Silk, D.J. (1990), Managing Infor-
mation Systems, McGraw Hill.
Management Information Systems, Conceptual
Foundations,
Tricker, R.I. (1982), Effective Information Systems,
Beaumont Press.
[ 191 ]