Case Background
Juanita Lopez, head of the manufacturing support unit of the Purchasing Department at Pine Valley Furniture Company (PVF) is concern about the growing backlog and quality of work in her department as PVF expands. The purchasing Department manages all interactions between external suppliers and internal PVF departments. These interactions include the following simultaneous processes.
· Identifying and selecting approved vendors for different materials and supplies
· Negotiating prices, order quantities, and other terms with suppliers
· Placing and tracking orders
· Monitoring the quality of materials received
· Working with vendors to identify defects and improve quality to meet PVF standards
· Working with PVF departments in helping choose a vendor when materials are required.
· Working with PVF departments to determine acceptable inventory levels and order lead times to ensure uninterrupted operations.
Juanita is concern about delays in placing vendor orders, inefficiencies in determining the status of vendors orders, and late management summary reports. Furthermore, relationships with vendors are becoming more critical as just-in-time inventory control methods are implemented by PVF manufacturing operations. As Juanita has been charged with solving these issues without adding office staff, she is hoping that new automation can help. A systems analysts for each business unit (like purchasing) works as a liaison between that unit and the IS development group. Juanita calls Cris, the systems analyst assigned to purchasing, to discuss her concerns.
Chris has been with the PVF for six years. He joined PVF right after graduating from baccalaureate program in the Computer Information Systems program in the business school of Valley State University. His first job was a Programmer/Analyst I, in which he coded and maintained financial application systems written in COBOL.
As Chris become more experienced in his job, he was asked to take additional program design work and was soon promoted to Programmer/Analyst II. He assumed somesupervisory responsibilities on projects and gained more authority in structuring programs, in choosing methods to access databases, and even in recommending functional changes to systems in order to take advantage of technology.
Eventually, the growth in systems work at PVF necessitate the expansion of the information systems development unit, and Chris was promoted to a Junior Systems Analyst position in the group supporting manufacturing operations. In this assignment, Chris participated on the team that developed a five-year plan that would enable information systems to support manufacturing at PVF. This plan considered all aspects of manufacturing and its interactions with other parts of the business, such as marketing, accounting, and purchasing. Chris also worked on one initial projects gathered from this plan which dealt with product structure (or bill-of-materials) data. As part of this project, Chris was responsible for designing files and databases to maintain this data. Since some product data (primarily physical characteristics) depended on vendor specifications, he had to analyze relevant Purchasing computer files to obtain data descriptions. As a result, at the time of Juanita’s call, Chris was already aware of some of the pressure on Purchasing caused by the growth and change in manufacturing operations and had a basic understanding of Purchasing systems at PVF.
IDENTIFYING THE PROJECT:
Juanita’s career has also progressed rapidly. Her work has been rated very highly and she is well respected. Juanita has never worked on a systems development project, however, and her education at a small liberal arts college did not include any exposure to information systems. Although Juanita knows the operations of her department very well and has fairly clear idea of some problems as well as opportunities for improvement, she does not know how to translate these into precise requests for help from systems development. The IS development group is highly regarded and Juanita believes her open management style and Chris’ expertise can complement each other in working together.
At their first meeting, Chris explains that his role at this point is to help Juanita state what her business problem is and to suggest how support from any new or improved information systems could solve her problem. In fact, one of their early joint responsibilities is to develop a brief justification for their proposal. Chris points out that, due to the huge demand for new and improved systems at PVF, not all requests can be accommodated. Further, PVF has instituted a charge-out, transfer pricing, scheme whereby business units requiring systems development have to pay for the work done by the system development unit. Thus, Juanita has received approval from her boss to fund any work performed by Chris’ unit.
Chris outline the process he and Juanita will have to follow. He explains that several years ago PVF had instituted a structured systems development methodology (SDM). He gives Juanita a copy of a chart summarizing the various steps that have to be followed for projects managed by the IS Unit. Using this methodology means that all project requests, proposal, and development efforts follow a common and well-defined process. This methodology also specifies how a systems project will managed and how progress will be measured, the role of different people involved on the project team, the deliverables due to each steps, the tools and techniques used during each step, and the form and content of a project dictionary or repository to document the project. This is common development methodology – the PVF Systems Development Methodology (SDM) – allows for
· Consistent management of projects
· Easier estimation of project times and cost
· Higher quality of work since people have been trained in the specifics of the methodology
· A more understandable process for both Chris and Juanita
·
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PVF Systems Development Methodology (SDM) – Overview
1. Product Identification and Selection
1.1. Systems Service Request Evaluation
1.1.1. Develop SSR
1.1.2. Analyze SSR by Systems Priority Board
1.1.3. Assign SSR Disposition
1.1.4. Allocate resources for Project Initiation and Planning phase
1.2 Established project management procedures and modifications to SDM
2. Project Initiation and Planning Phase
2.1. Develop Project Plan
2.1.1. Develop overview of user requirements
2.1.2. Analyze stakeholders and risks
2.1.3. Construct work plan.
2.1.4. Describe resource requirements for Analysis phase
2.2. Develop business case
2.3. Review Project Initiation and Planning Phase*
3. Analysis Phase
3.1. Determine requirements
3.2. Structure requirements
3.3. Select system direction
3.4. Refine business requirements
3.5. Update project plan.
3.6. Review Analysis Phase*
3.6.1. Review work done to date
3.6.2. Review updated business case
3.6.3. Allocate resources for Logical Design Phase
4. Logical Design Phase
4.1. Document information Flows
4.2. Document data requirements
4.3. Document processing logic
4.4. Document user interfaces
4.5. Refine business case
4.6. Update project plan
4.7. Review Logical Design Phase*
4.7.1. Review work done to date
5. Physical Design Phase
5.1. Select technology
5.2. Design database and files
5.3. Design programs
5.4. Develop test plan
5.5. Plan installation
5.6. Refine business case
5.7. Update project plan
5.8. Review Physical Design Phase*
5.8.1. Review work done to date
5.8.2. Allocate resources for Implementation Phase
6. Implementation Phase
6.1. Programming
6.2. Testing
6.3. Education
6.4. Documentation
6.5. Installation
6.6. User acceptance testing
6.7. Final installation
6.8. Project Termination
6.8.1. Evaluate personnel
6.8.2. Review project with management
6.8.3. Release personnel
7. Maintenance
7.1. Annual system review
7.2. System audits
7.3. Submit Systems Requests for systems changes
The first is to develop a System Service Request (SSR). An SSR briefly states the business problem or opportunity and presents general ideas on how an information system could deal with the problem or opportunity.
PVF has a standard SSR form, which Juanita and Christ need to complete together. Juanita and Chris will then submit this form to the Systems Priority Board, a diverse group of business and systems managers representing a cross section of some cases, the board suggests that the end users making the request attempt to develop their own systems using user-friendly tools such as electronic spreadsheet package or simple database management system. The board also rejects some requests. In most cases, however, the Board assigns a priority to the request and places it in a backlog of such requests in decreasing order or priority. Although this is a very formal process, the systems development group tries to make it painless as possible for the requesting end-user through the help of some from the liason staff, like Chris.
Over two-week period Chris and Juanita meet and talk on the telephone several times as they put together the SSR. The SDM calls for only a cursory analysis of Juanita’s situation for the SSR. The idea is to lay out the scope and basic issues involved, not to thoroughly evaluate the situation. Later steps in the methodology refines the analysis. Chris explains to Juanita that one o the basic premises of the methodology is incremental commitment. Using incremental commitment, there are many review points during a project, each successively dealing with the information system request in greater depth. The goal is not to sink significant resources into a project until the work is reviewed and the organization is willing to commit further resources to the project. In this way, incremental commitment allows projects to be easily redirected or killed.
Below shows the System Service Request Chris and Juanita develop. As you can see, the request briefly describe the situation in Purchasing. Juanita shows this SSR to her boss, Sal Divario, who signs the form. Sals signature does not commit him to funding the project, only to support the request being sent to the board. Chris then submit this form to the systems priority board for their decision.
Pines Valley Furniture
Systems Service Request
REQUEST BY: Juanita Lopez DATE: November 1, 1994
DEPARTMENT: Purchasing Manufacturing Support
LOCATION: Headquarters, 1-322
CONTACT: Tel: 4-3267 FAX: 4-3270 email: jlopez@yahoo.com
TYPE OF REQUEST: URGENCY
[ x] New System [ ] Immediate – Operations are impaired or opportunity lost
[ ] System Enhancement [ ] Problems exist, but can be worked around
[ ] System Error Correction [ ] Business losses can be tolerated until new system installed
PROBLEM STATEMENT
Sales growth at PVF has caused greater volume of work for the manufacturing support unit within Purchasing. Further, more concentration on customer service has reduced manufacturing lead times, which put more pressure on purchasing activities. In addition, cost-cutting measures force Purchasing to be more aggressive in negotiating terms with vendors, improving delivery times, and lowering our investments in inventory. The current modest systems support for manufacturingpurchasing is not responsive to these new business conditions. Data are not available, information cannot be summarized, supplier orders cannot be adequately tracked, and commodity buying is not well supported. PVF is spending too much on raw materials and not being responsive to manufacturing needs.
SERVICE REQUEST
I request a thorough analysis of our current operations with the intent to design and build a completely new information system. This sytem should handle all purchasing transactions, support display and reporting of critical purchasing data, and assist purchasing agents in commodity buying.
IS LIASON: Chris Martin (Tel: 4-6204 FAX: 4-6200 email: cmartin@yahoo.com)
SPONSOR: Sal Divario, Director, Purchasing
--------------------------------- TO BE COMPLETED BY SYSTEMS PRIORITY BOARD ---------------------------
[ ] Request approved assigned to _____________________________
[ ] Start date _____________________________
[ ] Recommend revision
[ ] Suggest user development
[ ] Reject for reason _______________________________________
_______________________________________
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