A generic accounting model to support operations management decisions

Information systems are generally unable to generate information about the financial consequences of operations management decisions. This is because the procedures for determining the relevant accounting information for decision support are not formalised in ways that can be implemented in information systems. This paper describes a formalised procedure, which is based on the following theoretical propositions: (i) cost behaviour is described on the basis of a company's contracts for purchasing and selling resources, and (ii) hierarchical relationships between decisions are recognised, because some decisions have to be made earlier than others. Earlier decisions determine the feasible alternatives for later decisions (e.g. through constraints in available production capacity or components), and the plans that supported the earlier decisions serve as instructions for later decisions. The procedure can be implemented in information systems to provide accounting information in case later decisions deviate from these instruc tions (within the limits of the real-world constraints) because new information becomes available.     

REQUIREMENTS PLANNING FOR CONTROL OF INFORMATION RESOURCES

Producing reports assembled from files, records, and raw data is a major function of the computer in modern organizations. Transaction processing, records management, file organization, and data-base management are aspects of the information production function that have received a good deal of attention. But planning, scheduling, and controlling the production of information products have been neglected. For complex applications involving assembly of reports from multilevel information sources, the requirements planning model is suggested as an effective alternative to present methods. Thus, our suggestion is that the computer be used to plan, schedule, and control computer production of information products. Presently available material requirements planning software may be employed with minor modifications that depend on the given information system characteristics. In this paper an example of requirements planning as applied to production of information in a satellite control system is presented.     

The Information Problems in Organizations: A Research Model for the Value of Information and Information Systems*

Growing recognition of the need for better management information system (MIS) theory and practice centers around problems with identifying the value of information and information systems in organizations. This paper addresses this issue by showing that existing theory in organizational economics and industrial organization directly relates to information problems in organizations (their nature, and their effects in terms of organization structure and performance). The paper categorizes these problems and associated theories into four distinct classes and shows that MIS research and practice can be mapped to information problems of each type. Because the economic theory pertinent to specific information problems includes the nature of the organizational response to information constraints, it also provides insight into the nature of the improvement to be realized if information constraints can be overcome. These improvements can then be interpreted as the value of the associated information systems which suggests using the resultant classification scheme to map between information problems and system value. The paper shows that this methodology provides a more appropriate level of focus than either traditional normative or business value methods, especially because many improvements have structural as well as performance consequences.     

META-DESIGN CONSIDERATIONS IN DEVELOPING MODEL MANAGEMENT SYSTEMS*

This paper examines cognitive considerations in developing model management systems (MMSs). First, two approaches to MMS design are reviewed briefly: one based on database theory and one based on knowledge-representation techniques. Then three major cognitive issues—human limitations, information storage and retrieval, and problem-solving strategies—and their implications for MMS design are discussed. Evidence indicates that automatic modeling, which generates more complicated models by integrating existing models automatically, is a critical function of model management systems. In order to discuss issues pertinent to automatic modeling, a graph-based framework for integrating models is introduced. The framework captures some aspects of the processes by which human beings develop models as route selections on a network of all possible alternatives. Based on this framework, three issues are investigated: (1) What are proper criteria for evaluating a model formulated by an MMS? (2) If more than one criterion is chosen for evaluation, how can evaluations on each of the criteria be combined to get an overall evaluation of the model? (3) When should a model be evaluated? Finally, examples are presented to illustrate various modeling strategies.     

An Empirical Test of the Strategic-Grid Model of Information Systems Planning*

Contingency models of information systems planning predict that no single planning approach will suit all organizations' needs. Little empirical research has been undertaken, however, to evaluate this prediction. Accordingly, we used McFarlan, McKenney, and Pyburn's (1983) strategic-grid model to study the information systems planning problems encountered by 49 governmental agencies. Twenty-seven agencies were required to follow a planning approach best suited to organizations that had a high level of dependence on both their existing and proposed systems. We predicted that agencies not having these characteristics would encounter the most problems with the approach. The remaining 22 agencies could choose their own planning approach. We studied this latter group to determine whether the problems encountered by the first group could be attributed to the mandated approach. Overall, the empirical results obtained were equivocal. Some results indicated that more planning problems were encountered by agencies in which the mandated approach was not appropriate to their position in the strategic grid. Other results were not supportive of this proposition. More work needs to be undertaken, therefore, to evaluate the predictive and explanatory power of contingency models of information systems planning. In addition, our research indicates a need to develop more rigorous theories of information systems planning behaviors, to improve the instruments needed to measure these behaviors, to explore the relationship between information systems planning behaviours and organizational effectiveness, to investigate how organizational learning impacts planning behaviors, and to determine the types of information systems planning problems that diffuse through organizations and those that remain localized.     

A Service Quality Process Map for Credit Card Processing

Evaluating marketing (external) and operations (internal) service quality performance in most organizations is a data-oriented management task that involves many variables for many different types of services. These two diverse sets of service quality information seldom “match up well” because the marketing and operations functions define and evaluate service quality “their way.” Management's interpretation of what the data “mean” often contributes to extra meetings, unnecessary disagreements within and between functional areas, and poor decision making. This situation can affect the quality and timing of decisions, and ultimately, the organization's profitability and market share. This paper quantitatively relates the customer's evaluation (perception) of service quality directly to the activities and performance criteria of the service delivery process for a credit card processing center. Basic statistical analyses and a recursive path analysis model define the relationships between marketing- and operations-based service quality information. The idea of a “service quality process map” is introduced. A service quality process map relates a flowchart of the service delivery process to the customer's perception of service using the power of multivariate data analysis. Management insights gained from an analysis of marketing (external) and operations (internal) measures of service quality performance can be used to allocate resources wisely. The objective is to gain the most improvement in the customer's perception of service for the least cost. Service quality with this type of evaluation capability can be used to gain competitive advantage in the marketplace.     

System Development Project Effectiveness: Problem-Solving Competence as a Moderator Variable*

In spite of end-user programming, for the foreseeable future users and information systems (IS) specialists will build systems together. A better understanding of this partnership (which has a troubled history) will help IS managers and users improve their management skills. This study investigates the relative contributions to project effectiveness of problem-solving competence, the quality of the working relationship, and the quality of the development process. Seventy-five medium-sized projects in 16 organizations were investigated using individual, one hour, structured interviews with the IS project leader and with the primary user. Results suggest that more complex models should be used to study system development. Moreover, problem-solving competence demonstrated a complex effect on project effectiveness.     

An Investigation of Equity as a Determinant of User Information Satisfaction

This paper reviews equity theory and proposes that perceived inequity in the allocation of management information systems (MIS) resources is likely to influence overall user information satisfaction (UIS). Therefore, in addition to currently identified factors such as quality of information products (QIP), user's knowledge and involvement level (KIL), and EDP staff and services (ESS), equity is also likely to be a relevant factor in determining overall UIS. The paper reports on a cross-sectional survey to obtain data for testing the relevance of equity related issues in the MIS context. Responses from 226 users showed a strong correlation (.67, p > .001) between equity and overall UIS. Further, the addition of equity to the previously identified factors that influence overall UIS (i.e., QIP, KIL, and ESS) significantly increased the explained variance (from .48 to .56). The results support the relevance of equity related issues in determining user attitudes. It is recommended that MIS researchers and professionals take into account the likely influence of equity perceptions on user attitudes and behavior, and strive to develop and implement equitable resource allocation mechanisms. Implications of the findings for future research in the areas of MIS, UIS construct, systems implementation, and management of MIS are also discussed.     

Plots of Conditional Wait-Time Intervals Provide Better Information to Queueing System Arrivals

The management of queues is a very important aspect of service operations management. One way to enhance the queueing experience is to provide customers with the most informative and certain estimate of anticipated wait time. This paper develops such a measure—referred to as the conditional wait-time interval (CWTI)—for queueing systems with exponentially distributed service times. It is especially applicable at the operational level of an organization since it utilizes the most current information on the status of the system (number of customers in the queue at arrival). CWTI is also based on two risk factors that consider the chance a customer's actual wait time is outside of the estimated range. This paper also provides a graphical means to display multiple CWTIs.     

Developing Measures for Assessing the Organizational Impact of Information Technology: A Comment on Mahmood and Soon's Paper

In a recent study, Mahmood and Soon [26] identified and operationalized a set of variables that can be potentially impacted by information technology. The lack of factor analysis to verify the dimensionality of different variables is a notable omission in the study. This paper describes and employs the limited-information factor analysis approach and the minimum average partial criterion for testing the unidimensionality of different variables in the Mahmood and Soon study. While reconfirming the construct validity of eight variables, our results question the unidimensionality of two original variables. Further testimony is provided in favor of our results by citing previous research studies.     

Task-Structure Relationship of Information Systems Development Subunit: A Congruence Perspective*

Several studies have examined the influence of organizational context (e.g., organization size, environment, strategy) on information systems (IS) performance/success. But very few studies have examined IS structure, and those studies have focused on a particular element of IS structure (e.g., decentralization). Thus, the multidimensional structural configuration of IS as an organizational subunit has escaped research attention. Further, the nature of the task to be performed by the IS subunit as a contextual factor has been virtually ignored in the IS research literature. In this paper, we first develop a congruence model for the task-structure relationship in an information systems development (ISD) subunit setting. Then we test this model as a multivariate relationship followed by subordinate bivariate analyses. Analysis of data from 41 hospitals’ ISD subunits reveals that a congruence relationship between task context and the structure of an ISD subunit is present. Our findings also show that an exclusive association exists between uncertainty in the task environment and the decision-making structure. Likewise, the association between equivocality of task content and the control structure of the ISD subunit is also exclusive. Implications of these findings for decision makers and researchers are discussed.     

Cautions on the Use of the SERVQUAL Measure to Assess the Quality of Information Systems Services

The SERVQUAL questionnaire (Parasuraman, Zeithaml, & Berry, 1988) is one of the preeminent instruments for measuring the quality of services as perceived by the customer. In a recent Decision Sciences article, Kettinger and Lee (1995) suggested the use of a modified SERVQUAL instrument to assess the quality of the services supplied by an information services provider. However, a number of problems with the SERVQUAL instrument are discussed in the literature. This article provides an illustrative example utilizing data collected from 138 executive and information systems professional customers of a multibillion dollar information services provider in order to examine the validity and reliability of Kettinger and Lee's (1995) modified SERVQUAL instrument. Results of analyses do not confirm the findings of Kettinger and Lee. Moreover, it appears that the use of difference scores in calculating SERVQUAL contributes to problems with the reliability, discriminant validity, convergent validity, and predictive validity of the measure. These findings suggest that caution should be exercised in the use of SERVQUAL scores and that further work is needed in the development of measures for assessing the quality of information services.     

Modelbase Construction with Object-Oriented Constructs*

This paper proposes modelbase construction mechanisms in a decision support system (DSS) for representing and managing models of diverse management science/operations research modeling paradigms, using object-oriented database management systems (ODBMS) constructs. It focuses on the construction of a modelbase that maintains logical independence among the DSS components including modelbase, database, and solvers, but relieves the mismatching characteristics by facilitating intelligent and stabilized integration of them. As a conceptual framework to build such a modelbase, this research uses generic model concepts, and adopts structured modeling language (SML) as a paradigm-neutral model representation sublanguage. In the modelbase, three model abstraction layers including model type, model structure, and model instance are devised to facilitate the capture of multiple modeling paradigms and specific application models in different instantiation levels. The constructs and methods discussed are flexible enough to be applied to a wide variety of decision-making and problem-solving paradigms. A prototype system is developed under a commercial ODBMS called OBJECTSTORE with the C++ programming language, and diverse model manipulation commands are illustrated by an object-oriented structured query language (OSQL).     

Toward an Understanding of the Behavioral Intention to Use an Information System

Organizational investment in information systems is often large and risky given the variety of information requirements placed on systems today. To make more informed decisions and to meet the challenge of developing systems that satisfy these demands, system developers need to achieve a better understanding of factors that ultimately lead to system usage. To enhance this understanding, we posit a holistic framework to examine several constructs suggested in the literature that lead to the behavioral intention to use an information system. Our framework includes situational involvement, intrinsic involvement, argument for change, perceived usefulness, ease of use, prior usage, and attitude constructs. We extend the Davis, Bagozzi, and Warshaw Technology Acceptance Model (TAM), which is founded on the Theory of Reasoned Action. A diverse sample from industry is used to test our model. Structural equation modeling is used to examine the entire pattern of intercorrelations among the constructs and to test related propositions. A hierarchical structure is used to compare the explanatory ability of TAM with our extension. Our model explains a large portion of the covariance among the constructs that lead to a user's behavioral intention to use an information system and compares favorably with TAM. The results indicate that (1) the direct effect of situational involvement on behavioral intention as well as attitude is significant in the negative direction, (2) attitude seems to play a mediating role, and (3) intrinsic involvement plays a significant role in shaping perceptions. Finally, we conclude that the user involvement construct needs to be separated into its psychological as well as its participative components for developers to understand its impact on the systems development process.     

The Determinants of DSS Success: An Integrated Model*

The results of a field study investigating the determinants of decision support systems (DSS) success are presented. A multivariate model was developed and tested using multiple regression hierarchical analysis on responses from 118 DSS users. Several specific hypotheses are also proposed and tested. Data analyses indicate that DSS success, as measured by DSS satisfaction and perceived benefits, depends on several factors: previous user experience with DSS, user involvement, user training, top management support, information sources, the level of managerial activity, and task structure, difficulty and interdependence. Based on the research results, several suggestions are made to improve the likelihood of successful DSS implementation.     

ASSESSING INFORMATION SYSTEM VALUE: AN EXPERIMENTAL STUDY

Linear models of information system value that are a function of information attributes are empirically studied by having managers in two firms make assessments of the importance of attributes, the level of satisfaction produced by various levels of each attribute, and the overall value of total systems. The results verify that such models may be quite useful in information system design. It is also shown that ordinally ranked attributes work as well as the interval-scaled attributes in the linear model. Since ordinal measures are easier to obtain, this suggests that “linear ordinal” models may be the most practical method of quantifying information systems value.     

Swiftness and Intensity of Administrative Innovation Adoption: An Empirical Study of TQM in Information Systems

Considerable attention has been directed toward developing a more complete understanding of innovation adoption by Information Systems (IS) departments. Much of this research has focused on the adoption of technological innovations, and limited research has focused on the adoption of administrative innovations. This paper focuses on an administrative innovation that is increasingly becoming popular among IS departments, namely Total Quality Management (TQM) in systems development. A synthesis of the IS innovation and TQM literatures was conducted to identify environmental, organizational, and task‐related factors that should relate to both the swiftness and the intensity of TQM adoption. The relationships between the identified variables and TQM adoption were examined using data collected from 123 IS departments in Fortune 1000 firms and large government agencies in the U.S. The results indicate that TQM adoption in systems development is influenced by the host organization's quality orientation and factors internal to the IS department including IS management support for quality, the presence of a separate quality assurance function, and the structural complexity of the IS department. Implications of this study for theory, future research, and practice are discussed.     

An Instrument for Assessing the Organizational Benefits of IS Projects

This paper reports the development of an instrument to measure the organizational benefits of IS projects. The basis for this instrument was a published framework that suggests three categories of such benefits: strategic, informational, and transactional. In a cross-sectional study of 178 IS projects proposed and approved for development, this framework was operationalized and empirically tested using the measurement model of LISREL. The analysis culminated in the validation and refinement of the these categories. The final instrument offers items under three separate subdimensions of strategic benefits: competitive advantage, alignment, and customer relations. Informational benefits are similarly comprised of information access, information quality, and information flexibility. Finally, transactional benefits are also shown to be of three types: communications efficiency, systems development efficiency, and business efficiency. Implications of this multidimensional instrument for IS practitioners and researchers are discussed.     

THE STRUCTURE OF EXECUTIVE INFORMATION SYSTEMS: AN EXPLORATORY ANALYSIS

This paper reports on a study which attempted to identify the structure of executive information systems and evaluate their relationship to decision making. The study centered on answering the question: “Where and how do senior executives get their decision-making information?” The data, provided by five senior executives, were gathered by a variety of means which included personal interviews, questionnaires, and logs of the executives' incoming-information transactions for a two-week period. Our findings support beliefs that senior executives receive much information from the environment, that informal systems play a role equal to that of formal systems, and that computers do not provide much information directly to an executive. The study also found that internal information is important and that preferred sources and media vary with different decision roles. The authors suggest that the scope of MIS and DSS be broadened to match those information networks managers actually rely on in daily practice.     

Replication of Measures in Information Systems Research: The Case of IS SERVQUAL*

The Information Systems (IS) discipline should recognize potential pitfalls in replication of research studies. This response to a note appearing in this issue by Van Dyke, Prybutok, and Kappelman (1999) aims to serve two purposes. First, this note will address the problems we have with the Van Dyke et al. (1999) attempted replication of our own previous work. Second, we hope it serves to establish more generally an awareness in the IS field for the potential to create and accept the “illusion of replicability” when this has not really been established.