The Project Selection Bias Against Management Support Systems: September 1982 (Classic Reprint)

Excerpt from The Project Selection Bias Against Management Support Systems: September 1982

Information systems are now crucial to most business functions, not only at the operational level but also in helping managers to compete effectively and efficiently in the market place. Consequently, companies are faced with the problem that demand for new computer-based information systems greatly exceeds the systems development capacity of their l/S department. This underlines the importance of the project selection procedures which should allocate scarce systems development resources in a manner that will provide the best leverage for the company's objectives.

How do most companies discriminate between different project requests? More importantly, does the project approval process work effectively? The answer, according to the research results discussed herein, is mixed.

The current project approval methods were developed alongside the evolution of traditional transaction processing systems and are thus most appropriate for evaluating those specific system types. We will argue that the typical project evaluation process is not valid when it comes to assessing systems whose main purpose is to support managerial decision-making. Applying current project approval methods to management support systems can eliminate potentially valuable systems, accept systems of little value, or worse -- prevent them from even being proposed.

Management support systems need a separate evaluation procedure. The type of system under consideration should be determined at an early stage and the evaluation process suitable for that particular system type should be followed. Use of the appropriate evaluation process will do much to satisfy current demand for new systems while an inappropriate process will be an impediment to the successful evolution of the I/S function.

This paper starts with a review of current user demand for systems. This will reveal that although management support systems are generally recognized as being especially appropriate to managers most important tasks, the number of these systems being developed does not match their increased demand.

Then we focus on the current project approval process. On the basis of a survey carried out among user managers, the relative importance of various criteria in project proposals is discussed. This survey also enables us to understand how managers judge the budget and schedule estimates presented in project proposals. Additionally, it shows managers perceptions of the different factors regarded as important in project approval and of the influence carried by various managers in this process.

On the basis of this evidence we present a critique of the current project approval process. Transaction processing and managerial support systems are fundamentally different in their justifications. Incremental modifications to tighten-up the current process miss the point altogether. Our recommended dual-track process insures effective evaluation of all system types. This new approach to project approval should also prove useful in the evaluation processes associated with further developments of computer-based applications such as CAD/CAM and office automation.

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