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IMPORTANT NOTICE

Please print and hand out your work to me


before class
Tuesday 5th February

Information Systems for Managers

GROUP CASE 1

• Read the case Royal Hotels and Resort p. 42-46.


• Answer the following questions:
– Despite having relatively little specific information about why the system
failed, what do you think are the main reasons for such failure?
– How could you fix these problems?
• Limit your answers to one page (12 Font single-spaced) BUT add any
appendices you need to support your argumentation (diagrams, graphs,
tables, etc.)
1. Executive Summary

The Royal Hotel case concerns the implementation of an Information system in the
hotels industry. An external consultancy was hired to solve a problem and optimize a
certain process at the hotel. After convincing the management team of a strategic
recommendation, a problem arose throughout the implementation phase. As a result,
the responsible consultant has to identify and solve the problem within a limited
timeframe. Hence, the overall goal of this work is to provide several strategic
frameworks in order to determine the problem, give insights on how information
systems are accepted in organizations and finally how to solve and tackle the issues in a
structural and efficient manner.

2. Case Background and Overview

The case is about the recommendation and the implementation of an information


system called M-Tech Espresso! in the hospitality industry. To be more precise, the Royal
Hotel in New York City has the goal to improve its service. This is due to some events in
the past, where service did not align with the standards of the hotel in general (clogged
toilet or stain on the carpet). The recommended solution by an external consultancy was
the implementation of a rapid response system. This information system has four
advantages for its users.

Rapid response
Since the Espresso! application enable a phone interface, the housekeepers can
immediately report issues with the room, without having to wait until the end of the
service shift and the verbal communication.

Quality control
The immediate reporting of problems ensures, that the issues are reported and that
maintenance actually receives the request. This decreases the likelihood of unsolved
problems through human failure to a large extent.
Preventive maintenance
The maintenance department is able to learn from recurrent problems and can predict
future issues.
Reporting
Best performers and motivated employees can be rewarded through the extraction and
identification of valuable reports. The responsible consultant Blake Cantera convinced
the executive team of his recommendation and prepared for the rollout strategy and
implementation. Unfortunately, he was called to another project and had to hand the
case to his fellow consultant Jack Scarso. But the rollout did not go as planned and after
finishing his second project, Blake was called back to the NYC Royal Hotel to
troubleshoot and find the issue within the implementation.

3. Issue Identification
Blake has to identify the problems by using several frameworks and strategies. Clearly,
the main issue lies within the implementation of the Espresso! System. But there are
multiple options, where the project could have gone wrong. In order to analyze every
option, the information system component is a good point to start. It consists of four
different perspectives, whereas every one of them addresses a different issue
(technology, process, structure and people). Furthermore, you can divide them into two
subgroups,

Image 1 – Information System Components


4.Analysis and Interpretation
As stated in the chapter before, I will begin this analysis with the four components of an
Information System. These components are the result of the sociotechnical theory,
which was applied to IT-based information systems. In general, they can be divided into
two subgroups, technical and social. The main difference between these two groups is
the focus of the social subgroup on the human element.

Information technology
In general, Information technology is defined as hardware, software and
telecommunication equipment. For this very reason, the IT equipment can be seen as a
crucial element in every information system. It is enabling and limiting the functionalities
of the IS through its design. Even in case of the Royal Hotel, the external consultant had
multiple software options, but he chose Espresso! due to the possible fit of the
company. But this decision has some downsides as well. Applied on the case of the Royal
Hotel, the way the data is organized may not be aligned with the procedures of the
hotel. If the system won’t allow certain actions, which would be necessary for the hotel,
it limits the value of the IS.

Process
The process perspective focuses on the steps, which are necessary in order to complete
a business activity. In case of the Royal Hotel, the steps could look like the following:

1) Service staff checks the room

2) Identify possible problems with the room

3) Describes and reports the problem to the system

4) Maintenance checks the system and sees the problem

5) Arrive at the room and try to solve the problem

6) Report the problem as solved


While, analyzing the process perspective it is important to note, that there is a gap
between the official business process and the informal ways, in which the processes are
actually performed. In our case Blake has been talking to the employees, but he received
the “Go” from the Top-level management, which might not have the insight on the
cleaning process. Therefore this discrepancy between the planned business process and
the manner it is enacted could have led to the fail of the Espresso! system.

People
This perspective does relate to the individuals or groups, which are directly related or
involved in the information system. Because every individual has his own capabilities
and personal agendas, a genuine understanding of the people involved is more than
essential. Their skills, interests and motivations have to be taken into consideration, once
you design and implement a new IS or while troubleshooting an existing IS. In case of the
Royal Hotel, the people play an essential role, because the whole organization will be
involved. This diversity of the people, from top-level management down to the shop-
floor level will increase the difficulty of a successful implementation. It requires a
detailed analysis of the skills, attitudes, preconceptions and personal agendas of every
group involved.

Structure
This component focuses on the organizational design (e.g. the hierarchy), reporting (e.g.
divisional) and relationships (communication) within the information system. Again, a
good understanding of the user resistance, incentive systems and relationships is
essential, because these factors often hinder the success of an IS system. In case of the
Royal Hotel it has to be determined whether Espresso! is really creating value for the
management team and the shop floor employees. There is evidence, that the system
would create value, due to the fact that the service team only has a limited amount of
time per room. On the other hand, this system would expose less effective service
employees and depend their performance on the use of technical devices. If they do not
have the corresponding knowledge about the IT equipment, it could cause a rejection of
the Information System in general.
After the analysis of the four components of an IS, the systemic effects have to be
determined next. To get a better understanding of this manner, I will include the Actor-
Network theory (ANT) perspective. This theory insists that all entities, human and non-
human, achieve their form/qualities via their relations with other entities. Furthermore
an actor is enabled or made to act by people and is constituted through their
interactions – relational materiality.Taking this fact into consideration, it becomes
obvious that the different perspectives influence each other to a large extent. All of the
four components are equally important, when it comes to effectiveness of the system in
general and a change in one component does require an adaption in the other three
components as well. As a result a company should not focus on optimizing the
technology component only, but the IS as a whole. Applied on the case of the Royal
Hotel the project could have gone wrong along the way. Since Blake was not part of the
initial implementation process, he doesn’t know if all four components have been
considered equally throughout the rollout. Blake should consider different systemic
effects as possible problems in order to find solutions. He does know that the staff
deemed IS in general; therefore he has the following options:

• Blake could declare the new system as failure and cut the losses by dropping the
use and go back to the old system. This alternative would be one of the worst. He
would not only damage the reputation of his consultancy, but also leave the
things and problems as they were before.

• If the quality of the user interface of the hand-held devices was not intuitive, the
failure could lie within there. Maybe an adaption of the interface or the change
of the devices could solve this problem. This solution focuses on the IT
component to a large extent. In addition, Blake could work together with the
staff, determine possible problems and change or adapt the user interface to fit
the individual needs. This approach would include the people’s component.

• Another possibility would be the lack of the staff to change. In this scenario,
Blake would have to replace the personnel and find tech-savvy employees. This
solution would not only drive costs incredible high, but does also require a lot of
time and effort. But this manner could also be rooted in the inertia of the
organizational structure. A restructuring of the organizational hierarchy and a
change towards the dynamic capabilities of the company would be necessary in
order to solve this problem. Overall this solution would focus on the structure
component.

Since there are several hints in the case study, that the peoples or structural component
could be the base for the failure of the system, I will focus on the uniqueness of an
organization next. I base this assumption on the fact that, “Employees had been very
eager to learn about the system but seemed to lose that interest rapidly afterward. The
director of housekeeping and the director of maintenance did not have much to add,
simply noting that employees found the manual system to work much better for their
needs. Obviously, companies introduce information systems in an effort to improve
efficiency and effectiveness. In order to do so, a company must select and capture the
relevant information to produce useful output for the internal or external use. The
process of choosing the right data is biased by the fact that every organization is unique,
as stated earlier. At the highest level of abstraction, the uniqueness is shaped by
strategy, culture, infrastructure and the external environment and influenced by the
organizational history, size, product line, values and attributes. I will elaborate in the
following why especially the four shaping elements are important while troubleshooting
on a structural or people’s component.

Firm Strategy
A strategy gives insights on how an organization is trying to achieve its goals. In other
words, you can predict a certain behavior from the company by analyzing its strategy.
For example, the strategy from the Royal Hotel is delivering exceptional service for its
reoccurring business customers. “We are very good by most hotels’ standard, but we are
not most hotels “, this fact makes it redundant that they focus on quality.
Firm Culture
The company’s culture is the collection of the individual beliefs, expectations and
values. Therefore this perspective is often a broad representation of how a company is
conducting business and reveals the informal and unspoken way, which the company
operates. Accepted practices in one company might be condemned in another one. This
perspective might be the crucial one in case of the Royal Hotel. If the IS does not fit to
the culture, it cannot succeed.

Infrastructure
Information system decisions are dependent on the current IT infrastructure to a large

extent. The current IT system can be seen as the technological backbone of the company

and constrains and enables opportunities for future information systems. Taking the case

from the Royal Hotel into consideration, this perspective can be neglected.

External Environment
Organizations do not exist only for themselves, but are encompassed by regulation, the
competitive landscape and general business and social trends. The surrounding
environment therefore influences a company to a large extent. Applied on our case, this
manner is rather subordinate, because the focus lies on the troubleshooting of the
already chosen IS system.

After this analysis, I would like to mention another point of view, the role of human
resources in project management. As stated in the case, Blake was removed from his
initial project and placed on a new one. What was the influence of this action on the
rollout? Was every stakeholder well informed and could Jake possibly do better? Due to
the limitation of this paper, I would like to highlight one essential point, the quality of a
project. Of course, it is important to meet cost and schedule expectations, but these
factors do relate to the efficiency instead of the quality. A quality project meets the
customer’s needs even if it exceeds the time and cost horizon. To achieve that goal, the
project team must continuously survey, anticipate, clarify and confront issues around the
project. At every step, human resources would the ideal choice to coordinate,
communicate and serve as catalyst in the transformation. Since we have to independent
consultants on the project, this process might have not been executed as planned.
Maybe there was a lack of information between Blake and Jack, which ultimately led to
the rejection of the system . Furthermore this perspective is closely linked with the
ontology of success. “If ontologies are performative, multiple and political, then
performatives are ontological, multiple and political and are thus capable of being
realized otherwise” The general message of his paper is, that success depends on the
perspective of the different stakeholders. In our case an external stakeholder (VFC,
Blake) wants to implement an IS so success would be the rollout and use of this new
system. But what if the internal stakeholders do not want to change, but rather stay at
the old system? The definition of success would change then to the denial of the new IS
in general. Having analyzed all of the above it becomes obvious, that there are multiple
options on how the project could have gone wrong. Therefore Blake needs a detailed
and structural method of conduct to analyze the initial problem of the implementation
of the IS.

5. Recommendations
Taking the conducted analysis into consideration, Blake has to identify the issue and
therefore bring all of the above-mentioned perspectives together. This can be done in a
three step change model.

First-Order Change: Automate


Automation is the simplest order of change and is based on the deployment of
technology. This level of change involves only the technology and processes component,
but does not rely up on the social subordinate group. Based on that, Blake has to
investigate further, since the problem is based within the social subordinate group.

Second-Order Change: Informate


This change focuses on the people, IT and processes to a large extent. Hence, not only
the way the process is performed changes, but also the individuals are affected by the
change. This results in a modification of their role or an exchange of the involved people.
Additionally, the manner in which the people interact with the technology modifies as
well. For these reasons, a second-order change mostly occurs, once a new IT system is
introduced. Applied on the case of the Royal Hotel, Blake will most likely find his mistake
within this part of the change. Even though he does not have the full knowledge of the
implementation, there is a quite large likelihood that the people at the hotel are a
crucial part of the mistake at the hotel.

Third-Order Change: Transform


The third order of change is the most radical and pervasive form of change. The third-
order covers the first- and second-order change and causes disruptions in the initial
organizational structure. Few of these changes for example include the way of how
reporting and authority actions are performed. Even though the Royal Hotel had no IS
system in the first place, it does not really change the hierarchical structure or ways of
reporting. Espresso! does only digitalize and support the already carried out task. For
this very reason, it is unlikely that a third-order change could happen at the Royal Hotel.

After conducting this final three-step analysis, Blake will definitely know, what caused
the rejection of the information system. Even though it might be obvious that the
people’s component caused the problem, there could possibly be hidden problem,
which hinder the success of the information system in general.