Week 3 - Systems Planning in the Information Age

This literature review is based on the content of Lecture 3 and the suggested reading of Lecture 3 of COMP 326. After reading those materials, I have learnt a lot of things

The article illustrated how the system planning and strategy is of great significance to different environments and emphasized how to make the planning relevant and effective in the emerging information age. It introduced the frameworks that emphasized two factors – Infusion and Diffusion which are highly correlated to reflect the system planning in today’s environment. It also summarized the past and current system planning practice as well as the introduction of the information technology architecture planning in the different environment.  It highlighted the transition in different stages with different information system planning:  stages of growth (SOG), Business System Planning (BSP), Critical Success Factor (CSF) and Complex.

We learnt that in 60’s, it was the initial stage where the firms started the information technology planning, and the leading approach was called stages of growth (SOG). During this stage, the firms built a lot computer room massively and hired numerous programmers and analysts to undertake the first large scale system development projects. The system planning was base on a notion that organization must go through this kind of change through a predictable sequence of steps at a modest pace. 

However, SOG was gradually weeded out by the technological changes after mid 60’s due to  two factors, first was the inexpensive mass-storage devices, second was the online system.  The environment was shifting from applications and processing management to data and information resources management. According to this shift, a different set of planning requirements was introduced. The well represented in this planning was IBM’s Business Systems Planning (BSP) which mainly coordinated intersystem view rather than identifying isolated application projects; it focused on conceptualizing and designing the overall corporate data resources. BSP changed the system planning to become highly customized goals which became more strategic to the company. However the disadvantages of BSP were, first it was too idealistic that rationalized the data structure, not too many firms could build a corporate database dramatically; second it was designed for centralized system, since IBM promoted mainframe, whereas some organization’s computing resource were decentralized.

In the late 70’s, the transformation started again where decentralization was begun since the popularity of the mini and micros computers. At that time management realized the impact of technology to their business operation is significant, they started to control over the system activities directly. The system planning has been replaced by new planning called Critical Success Factors (CSF) which was to identify the individual requirements for information system.

CSF planning was useful but it was good in dealing with isolated problem but not whole at a time.  CSF was ineffectual in the complex environment which both infusion and diffusion are high. 

Infusion is the degree to the information technology influencing to the company in terms of importance.  For example, a firm realized that information technology could make their products more competitive; lowering their cost and increasing their revenue, so the infusion is high.

Diffusion means decentralization, which is the degree to which technology has been scattered throughout the company. For example, a firm is low degree of diffusion if its with centralized mainframe and strong data processing within one hierarchy; on the other hand a firm is high degree of diffusion if its with numbers of minicomputers and microprocessors in different places and its not managed by same team and business unit manager is responsible for the development and operation of the systems.

The correlation of these 2 main factors could draw out a 2 dimension matrix and form 4 combinations, i.e. low infusion & low diffusion; high infusion & low diffusion; low infusion and high diffusion; and high infusion and high diffusion.

Firstly the article pointed out that in low infusion & low diffusion environment, the most appropriate approach of system planning was SOG. 

Secondly, in high infusion and low diffusion environment, the most appropriate approach of system planning was BSP.

Thirdly, in low infusion and high diffusion environment, the most appropriate approach of system planning was CSF.

Lastly, in high infusion and high diffusion i.e. nowadays the complex environment as know as the information age.  The system planning in this environment would take an electric approach which is tailored to meet specific needs.  The planning must focus on business strategy planning.  The firms have to develop its unique information age requirements in order to make themselves are competitive. Firstly technology must be designed and used to support new forms of organization design.  Secondly network resource management must be enforced since companies turn to information exchange where the network becomes a viable point of coordination in highly distributed systems.  Thirdly developing information system architecture would consider the requirements and relationship among different business process as a whole.

In conclusion, we could see nowadays banking and financial industries are taking the electric approach in the complex environment since the market competition is keen and the customer needs is increasing, i.e. how the banks allowing their customer to access the financial data or trade the stocks or buy their insurance anywhere and anytime.  In addition to the different Smartphone technology coming out, the banking is facing new challenges all the time.  The technology is influencing their banking products and technology could help them to differentiate their products in the markets.