MANAGEMENT COLLEGE OF SOUTHERN AFRICA

(MANCOSA)

ASSIGNMENT COVER SHEET

SURNAME LOUW

FIRST NAME/S CLINTON BRIAN

STUDENT NUMBER 117226

MODULE NAME MANAGEMENT INFORMATION SYSTEMS

ASSIGNMENT NUMBER 2

TUTOR'S NAME Trishana Ramluckan

EXAMINATION VENUE CAPE TOWN TO BE CONFIRMED

DATE SUBMITTED 18-Apr-11

SUBMISSION ( ) 1ST SUBMISSION  RE-SUBMISSION

6 EASTFORD STREET

POSTAL ADDRESS KNYSNA

6570

E-MAIL louwclinton@yahoo.co.uk

WORK: 044 3850310

CONTACT NUMBERS HOME: 044 3851366

MOBILE: 0823754303

COURSE/ INTAKE MBA YEAR 1 - JANUARY 2011

DECLARATION

I hereby declare that the assignment submitted is an original piece of work

produced by myself.

DATE: 18 April 2011

SIGNATURE:
 TABLEOFCONTENTS PAGE

LISTOFABBREVIATIONS 2

QUESTION1 3
1.1 CHALLENGESFACEDBY METROPOLITAN HOSPITAL 3
1.1.1 Knowledge Management SystemChallenge 3
1.1.2 Management Information Systems Challenge 4
1.1.3 Cost of MISand KMSchallenge 4
1.1.4 Security and Backup Issue Challenge 4
1.1.5 Challenge persuading board members 5

QUESTION2 7
2.1 Computer Hardware 7
2.2 Software 7
2.3 Connectivity 8
2.4 Security 8

QUESTION3 10
3.1 Systems Development Lifecycle 10
3.1.1 Systems Analysis 11
3.1.2 SystemDesign 11
3.1.3 Programming 11
3.1.4 Testing 12
3.1.5 Conversion 12
3.1.6 Production and Maintenance 13

QUESTION4 15
4.1 Explain how TIMM could solve the problems
experienced by each department as specified by
Grantt in her preliminary investigation 15
4.2 Discuss the additional benefits that each department
and the hospital as a whole could experience by the
implementation of the proposed integrated medical
management system 19

BIBLIOGRAPHY 22

2
 LISTOFABBREVIATIONS

DBMS Data BaseManagement System

EDI ElectronicData Interchange
IMIS IntegratedManagement InformationSystem
IMS IntegratedManagement System
IT InformationTechnology
KM KnowledgeManagement
KMS KnowledgeManagement System
LAMP Linux, Apache, MySQL, PHP/ Perl/Python
MEDINFO Medical Information
MIS Management Information System
MySQL MyStructuredQueryLanguage
PC Personal Computer
RDBMS Relational Data BaseSystem
SDLC SystemsDevelopment Lifecycle
SQL StructuredQueryLanguage
TIMM TotallyIntegratedMedical Management Information System
VAN ValueAddedNetwork
VANS Value AddedNetworks
VPN Virtual PrivateNetwork

QUESTION 1

Highlight the challenges faced by Metropolitan Hospital that is also common

to many Southern African business enterprises.

1.1 CHALLENGES FACED BY METROPOLITAN HOSPITAL

1.1.1 KNOWLEDGE MANAGEMENT SYSTEM CHALLENGE

It is clear from the case study that Metropolitan Hospital has no knowledge
management system in place. This does not, however, pertain only to
Metropolitan Hospital but to companies in the Southern African region as a
whole.

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 The concept of KM is a fairly new one in Southern Africa. Most businesses
were only made aware of it since 2000 by business schools and the academic
sector by promoting the KM concept in their courses and curricula.

According to Laudon et el (2010: p443) knowledge management refers to the

set of business processes developed in an organization to create, store,
transfer, and apply knowledge.

Effective knowledge management reduces the tendency to ‘repeat the

mistakes ‘or as others call it, ‘reinventing the wheel’. This is can prove to be
very costly and inefficient to Metropolitan Hospital. The application of the
wrong treatment to a patient may lead to malpractice lawsuits.

Effective knowledge management, therefore, can dramatically improve the

quality of services at Metropolitan Hospital. Effective knowledge management
will greatly contribute to improved excellence, which is to:

• dramatically reduce costs

• provide potential to expand and grow

• increase value and/or profitability

• improve the quality of products and services

1.1.2 MANAGEMENT INFORMATION SYSTEMS CHALLENGE

An analysis by Sarah Grantt, the new medical director, into the information
systems at the various departments revealed the following:

• Almost all departments have some sort of information system except

for the Medical department. This is a very perturbing factor because
this department is at the core of what Metropolitan Hospital do.

• Those departments ‘fortunate’ enough to have information systems

utilizes IT infrastructure that is obsolete, cumbersome and there is no
cohesion between the IT systems of the various departments. The
storing of information is unstructured.

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 • A lack of training for staff members (mainly medical) by the human
resources department on how to benefit from the effective use of
information systems that can lead to improved productivity.

1.1.3 COST OF MIS AND KMS CHALLENGE

There is no doubt that an improvement or total redesign of a firm’s information

system will be costly. The cost of developing, updating and maintaining such
a system require significant on-going investment of time and money. The
problem with Metropolitan Hospital is that they have a limited budget for
making improvements and that money is reserved for another project, namely
the opening of a new state-of-the-art cardiac centre.

1.1.4 SECURITY AND BACKUP ISSUE CHALLENGE

Backup and security procedures are not simply an IT matter, but are an
important part of corporate risk management and control. Backup measures
are an important part of assuring that the hospital can continue to do provide
health care services in the event of a system failure, and as part of a larger
business continuity plan to address loss of capabilities.

Some backup and may be left to the local departments; however, the backup
of mission critical and corporate systems proves to be more difficult and
should be organised as a corporate issue. The best backup and security
measures still do not ensure that system malfunction will not take place. The
reason for this is the human factor. The people responsible for backup and
security at any company are fallible.

1.1.5 CHALLENGE OF PERSUADING BOARD MEMBERS ABOUT MIS AND KMS

This can prove to be one of the most difficult challenges. It is not easy
persuading stakeholders or board members to adopt a new management
information system. The biggest constraint is the cost involved in such a
project. One of the major concerns by board members might be that the cost
involved with such a system outweighs the benefits that are generated.

The best way for the Metropolitan Hospital to address the challenges would
be to design and implement a KMS plan and a MIS plan
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(i) KMS plan

A knowledge management plan involves an analysis of corporate objectives

and a close examination of the tools, both traditional and technical that is
required for attending to the needs of the company. The challenge is to select
an IT infrastructure that fits the context of the overall strategic plan of
Metropolitan Hospital.

The KMS plan basically encompasses the following process:

• Gathering - data entry, ocr and scanning, etc.

• Organizing – cataloguing, indexing, filtering, linking

• Refining – contextualizing, collaborating, compacting and data-

mining

• Disseminating - flow, sharing, alert and push

(ii) MIS plan

Laudon et el (2010: p554) describes the information systems plan as a

road map indicating the direction of systems development (the purpose
of the plan), the rationale, the current systems/situation, new
developments to consider, the management strategy, the
implementation plan, and the budget.

This plan also describes how the goals of the company can be attained
with the support of information technology.

The business value of a KMS and MIS plan lies in the benefits that can
be generated for Metropolitan Hospital. These benefits can be tangible
(increased productivity, reduced facility costs, reduced workforce, etc.)

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 or intangible (improved asset utilization, improved resource control,
improved decision making, etc.).

QUESTION 2

Identify and describe the hardware, software, connectivity and security

requirements for Milley’s “fantasy medical institution”.

Dick Milley’s fantasy medical institution

2.1 COMPUTER HARDWARE

The hardware requirements for Dr. Milley’s fantasy medical institution depend on the
type of database that will be used, for example flat model, hierarchical model,
network model and relational model.

The relational model is the most popular of the databases, because it is relatively
easy to create and access and it has the added advantage of being easy to extend.

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After the original database creation, a new data category can be added without
requiring that all existing applications be modified.

This database organizes data in tables. Each table contains records of closely
related data that may be linked through some common characteristic. The relational
database has become the standard model for databases made from products such
as Access or MySQL.

2.2 SOFTWARE

SQL often referred to as Structured Query Language, is a database computer

language designed for managing data in relational database management systems
(RDBMS).

MySQL is the most popular open source database, because of its high performance,
high reliability and ease of use. It is also the database of choice for a new generation
of applications built on the LAMP stack (Linux, Apache, MySQL, PHP / Perl /
Python.) Many of the world's largest and fastest-growing organizations including
Facebook, Google, Adobe, Alcatel Lucent and Zappos rely on MySQL to save time
and money powering their high-volume Web sites, business-critical systems and
packaged software.

It can also run on many operating platforms such as Linux, Windows, Mac OS,
Solaris, HP-UX, and IBM AIX.

2.3 CONNECTIVITY

Connectivity is the ability to connect systems, application programs and people of a

company into a single integrated network. Computer networks are the main
connectivity instrument for passing data in an electronic environment. A network is
composed of several computers connected by a wired or wireless medium so data
and other resources can pass through for sharing.

According to Dick Milley he wants to be able to access medical information almost

anywhere in the hospital. The internet has enabled companies to use internet
working standards and web technology to create private networks called intranets
and extranets.

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The advantage of intranets and extranets is that it can create network applications
that can run on different types of computers throughout the organization including
wireless enabled laptops and smartphones.

Security is not a problem because these networks are protected from public visits by
firewalls.

Extranets will allow the suppliers and customers limited access to its intranet.
Intranets and extranets also have a cost benefit, because it reduces operational
costs.

The following must be considered when using a wired or wireless medium. Wireless
connections may not be fast or reliable enough for certain bandwidth-intensive
activities for sending or receiving large files. All of the devices connected wirelessly
share the approximate equivalent of an Ethernet cable bringing the connection
speed considerably down.

2.4 SECURITY

Security in a hospital has become a significant concern. The type of network system
used in the hospital is very important from a security perspective. Metropolitan
hospital should consider a virtual private network for the following reasons.

• A virtual private network (VPN) is a network that uses the Internet, to provide
remote offices or individual users with secure access to the hospital’s
network. VPN’s will provide Metropolitan Hospital with the same
competencies, but at a much lower cost.

• A VPN is much secured because it works by using the shared public

infrastructure while maintaining privacy through security procedures and
tunnelling protocols such as the Layer Two Tunnelling Protocol (L2TP).

• Data are encrypted at the sending end and decrypted at the receiving end,
data is send through a "tunnel" that cannot be "entered" by data that is not
properly encrypted. An additional level of security involves encrypting not only
the data, but also the originating and receiving network addresses.

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Database security represents the system, processes, and procedures that protect a
database from unauthorized activity.

DBMSs usually impose security through the following:

• ACCESS CONTROL - manages who can connect to the database through

authentication and what they can do through authorization.

• AUDITING RECORDS - information about database activity: who, what,

when, and possibly where.

• ENCRYPTION - protects data at the lowest possible level by storing and

possibly transmitting data in an unreadable form. The DBMS encrypts data
when it is added to the database and decrypts it when returning query results.
This process can occur on the client side of a network connection.

QUESTION 3

Explain how the TIMM IS team could use the structured systems development
lifecycle (SDLC) approach to attain their goal.

3.1 SYSTEMS DEVELOPMENT LIFECYCLE

In order for the TIMM IS of Metropolitan Hospital to attain their goals of integrated
medical information system is by means of the structured or predictive systems
development lifecycle approach (SDLC).

The Systems Development Life Cycle (SDLC) or the Systems Development Process
is a type of approach used to describe the process for building information systems,
intended to develop information systems in a very calculated, structured and
systematic way, reiterating each phase of the life cycle.
10
According to Laudon et el (2010: p515) this life cycle can be broken down into six
core activities. Figure 1 gives a visual representation of the systems development
process.

PRODUCTION
SYSTEMS
AND
ANALYSIS
MAINTENANCE

SYSTEMS
DEVELOPMEN
CONVERSION T SYSTEM
DESIGN

PROCESS

TESTING
PROGRAMMIN
G

Figure 1: Adapted from source: (Laudon and Laudon,

2010: p516)

It must be stressed that although each of the systems development activities are
depicted in a sequential order, some might be repeated or takes place
simultaneously.

3.1.1 SYSTEM ANALYSIS

The TIMM IS team can use system analysis to understand the details of the system
proposed by Dick Milley, such as the IT infrastructure that will be used, which
database to use, software, connectivity, etc.

A decision on the desirability of the system can then be taken. Therefore, system
analysis is a useful tool for the TIMM IS to investigate the proposed system, identify
problems, and using the information to implement the system. Before any decision
can be made the TIMM IS should conduct a feasibility study to determine whether
the solution proposed will be feasible from a financial, technical, and organizational

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level.

3.1.2 SYSTEM DESIGN

Systems design is the process of defining the architecture, components, modules,

interfaces, and data for a system to satisfy specified requirements. It serves as the
blueprint for the overall plan or model for the integrated medical information system
that will be used by Metropolitan Hospital and how the system will fulfil the objectives
of the hospital.

The purpose of System Design is to create a technical solution that satisfies the
operational requirements for Metropolitan Hospital’s proposed system.

During the system design process certain design specifications are produced for
example, system components, system environment, implementation requirements
and time and cost estimates. The specifications should address all the managerial,
organizational, and technological components of the chosen system solution.

3.1.3 PROGRAMMING

This entails the construction of the new integrated management system for
Metropolitan Hospital. During this phase system specifications are translated into
software program code. It is not necessary for the TIMM IS team to perform this task
because software that meets the requirements for the hospital’s new system can be
purchased from a variety of software retailers. This will save metropolitan Hospital a
lot of time and money. The suppliers of prewritten, predesigned and pretested
software programs also provide on-going maintenance and enhancements to keep
the system in line with changing technical and business developments.

Other options to consider is outsourcing, an external organization build or operate

the information system, and offshore outsourcing, the organization that will build or
operate the information is located in another country. The latter is done purely as a
means to cut costs.

3.1.4 TESTING

The software program code is tested at various levels in software testing to

determine whether the system will produce the desired results. These tasks are
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performed on a regular basis. This is a grey area as many different opinions exist as
to what the stages of testing are and how much if any iteration occurs. Following are
the types of testing:

• Unit testing is done to test each program individually;

• System testing involves the testing of the system as a whole;

• User acceptance testing is the final certification that the system is ready to be
implemented.

3.1.5 CONVERSION

This phase refers to the changing form the old system to the new system. The
following conversion strategies can be utilised:

 PARALLEL STRATEGY

o The old and the new system runs concurrently to ascertain whether the
new system functions properly. The advantage of this approach is that
it is the safest, because in the event of errors the old system can be
used as a backup. However, the biggest drawback of this strategy is
that it is very expensive to maintain.

 DIRECT CUTOVER STRATEGY

o The old information system is replaced entirely with the new system.
This is the riskiest of the four strategies because in the event of errors,
there is no other system to fall back on. This strategy could prove to be
the costliest of them all.

 PILOT STUDY APPROACH

o The new system is introduced to a limited area of the hospital, such as

the medical department or finance department. Only upon the success
of the pilot version will it be installed throughout the hospital.

 PHASED APPROACH

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 o This strategy introduces the new integrated management system in
phases, either by functions or by organizational units.

o In this approach the organization undergoes a kind of "rolling"

conversion in which one subsystem after another is changed over from
the old to the new system.

o As an example, patients records can be installed first, followed by

accounts, etc. Other functions will come later. Alumni and
development came at the end.

o The disadvantage can be that it takes a long time to complete the

conversion phase, and extra development work is needed.

3.1.6 PRODUCTION AND MAINTENANCE

After the installation and conversion of the new integrated management system, it is
said to be in production. During this phase the users and technical specialists
continually review the system to determine whether the system will be able to attain
the performance requirements of Metropolitan Hospital.

The purpose of this phase is to:

 Operate, maintain and enhance the system

 Certify that the system can process sensitive information

 Determine when the system needs to be modernised, replaced or retired.

The TIMM IS team of Metropolitan Hospital must take note of the following with
regard to the systems development lifecycle

• Systems development rarely works so effortlessly.

• There is sometimes a need to revisit the previous phases of the SDLC.

• Difficulty of recording requirements in a functional way.

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 • Scheduling and budgeting is challenging especially if Metropolitan Hospital
has large SDLC phases.

QUESTION 4

4.1 Explain how TIMM IS could solve the problems experienced by each
department as specified by Grantt in her preliminary investigation.

MEDICAL DEPARTMENT

Problem:

Output of medical data always generated on paper, whilst medical procedures are
done by computerized equipment.

Possible solution:

Implementation of the MEDINFO (MEDical INFOrmation) system that is basically a

general purpose computer-based information storage, retrieval, and analysis system.
It is created for a time sharing, on-line computer system for the speedy and easy
creation, maintenance, and analysis of general data files. The MEDINFO system
allows for an analysis to be created, a description of the data made, data to be
entered and updated into records, and for the data to be displayed or analysed by
the investigator without programmer intervention.
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CLAIMS DEPARTMENT:

Problem:

Patients’ personal data are still keyed in manually from charts and coded according
to insurance and Medicare specifications. Claims are not using a Web based
medical claims service agency. The claims system is only connected to the
accounting system.

Possible solution:

The purpose of the management information system is to eliminate redundancy.

In South Africa the MedEDI system uses Electronic Data Interchange (EDI), which
permits healthcare professionals to collect their patient billings now - in real time.

It has some of the following advantages:

• Dramatically reduces calls to medical schemes and simplifying medical

scheme claim administration tasks

• Reducing time spent ‘following up’ and 'chasing debt’

• Providing an immediate acknowledgment from the medical scheme that they

have received the claim from the hospital

• Eliminating the need for several stand-alone billing applications and EDI
(electronic data interchange) systems

• It is a very affordable system

ACCOUNTING DEPARTMENT:

Problem:

Accounting is still PC-based and uses an off-the-shelf medical accounting software

package, handling all accounts payable and receivable. The accounting system also
maintained a full record of all patient personal data. The networking of the

16
accounting and claims departments required changing the types of computers
accounting used.

Possible solution:

Off-The-Shelf medical accounting software might not be sufficient for the accounting
needs of the Metropolitan Hospital. There are many accounting software suppliers
that provide software that are tailored to the needs of the hospital.

The Made To Measure Medical Accounting System is a powerful, flexible software

package for managing the many aspects of accounts of Metropolitan Hospital.

It often means the integration of many different functions involved in patient care:
scheduling, billing, maintenance of electronic medical records, accounting, etc.

PURCHASING DEPARTMENT:

Problem:

The purchasing department had become part of the accounting department about six
months ago, providing an opportunity for the hospital to utilize EDI (electronic data
interchange), which is the electronic exchange of business information, such as
invoices, payments, and order status information. With only a handful of suppliers
large enough to serve Metropolitan Hospital’s needs, the hospital signed a new
contract only every two years.

Possible solution:

The purchasing department should be separated from the accounting department in

order for them to function optimally.

Web-based EDI, or webEDI, will allow the hospital to network with its suppliers
without the worry of implementing a complex EDI infrastructure, such as value-added
networks (VANS).

17
Using a friendly web-based interface, EDI transactions can be received, edited and
sent as easily as an email. The hospital will also be able to receive EDI documents
and send EDI invoices and shipping documents with no software to install. The
Internet is making EDI more accessible to all. WebEDI has the added advantages
that it is accessible anywhere in the world and you do not need a dedicated IT
person to manage any software installation.

FINANCE DEPARTMENT:

Problem:

The finance department ran a packaged program on the hospital’s mainframe. It

tracked revenues and expenses by type. The finance and accounting departments
transferred data files into each other’s systems.

Possible solutions:

First of all, the finance and accounting department should be merged. Intranet is the
general term for a collection of private computer networks within an organization.

An intranet uses network technologies as a tool to simplify communication between

people or workgroups to improve the data sharing capability and overall knowledge
base of an organization's employees.

HUMAN RESOURCES DEPARTMENT

Problems:

Performance reviews are done online, but none of the medical staff took advantage
of that feature.

Possible solution:

It is important that all staff members must be made aware of the advantages of an
online performance review system. It is the task of the human resources department
to determine the reason for the medical staff not taking advantage of this feature.

LEGAL DEPARTMENT:

Problems:

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The legal department’s staff of three had its own PC client-server network. The
server contained all the legal documentation resources, and the department
subscribed to an online case database.

Possible solution:

The outsourcing of the legal services department . The true value of outsourcing
must be more than just saving the hospital money. The goal should be to provide a
solution to the legal needs of the hospital.

Other than cost savings, outsourcing includes the following advantages:

1. Quality: Vendors have expert legal employees along with specialized

processes and technology that ensure better quality of output for the hospital.

2. Flexibility: Outsourcing provides flexibility to the hospital as the buyer and can
change a vendor if required.

4.2 Discuss the additional benefits that each department and the hospital as
a whole could experience by the implementation of the proposed
integrated medical management system.

Additional benefits to the various departments of Metropolitan Hospital are as

follows:

MEDICAL DEPARTMENT:

 The benefits of IMIS are improved medical examination and treatment and
patient service.

 Less staff is required to cater for more patients in the same time or less.

 Staff can be redeployed to other suitable locations.

 Enabled improvement in the response time, because it automates the process

of collecting, collating and retrieving patient information.

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  Doctors can spend their precious time more in clinical activities than to put in
clerical activities.

 Provides an opportunity to enhance patient care.

 Records of patients can be retrieved simultaneously using IMS.

CLAIMS DEPARTMENT:

 Easily navigational software interfaces save a lot of time from data entry for
special jobs only.

 Eliminates denials due to lost charges and improves the hospital’s ability to
explain charges.

 Provides immediate access to patient correspondence associated with

encounters and receivables resolution.

ACCOUNTING DEPARTMENT:

 Accounting can sometimes become very complex. The integrated medical

management system eliminates any such complexity.

 Better cash flow and improved accuracy

 Simultaneous access to information

 Compliance with legal requirements

 Resolve matters quickly and efficiently

 Conserve time and increase accuracy and accountability within a department

PURCHASING DEPARTMENT:

 Purchasing department can use it to control costs and streamline the

procurement procedures without sacrificing control

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  It enables purchasing managers to move away from operational, day-to-day
tasks and instead focus on managing and negotiating stronger supplier
contacts, examining spend and purchase decisions, to ultimately progress the
purchasing function from a cost- to a profit-centre.

 Better purchasing information with lower overheads

FINANCE DEPARTMENT:

 Will enable the hospital to serve the rapidly growing number of health care
consumers in a cost-effective manner.

 Enhanced Revenue Management

DEVELOPMENT DEPARTMENT:

 Increased hospital publicity, means that donations will be much easier to

come by.

HUMAN RESOURCES DEPARTMENT:

 A much happier workforce because they will not be overwhelmed by multiple

cross-references

 Improved confidentiality

 Information can be accessed centrally.

 Authorized staff may retrieve any information at any time

 HR is relieved of routine tasks requested, with user permissible access

 All personnel documents can be electronically filed and secured for the life of
the document

ADDITIONAL BENEFITS OF IMMS TO METROPOLITAN HOSPITAL:

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  Clearly defined roles and responsibilities for managing the integrated
management system

 Drastically increase productivity in all departments

 Highest levels of security protects unauthorised release of protected health

information

 Improves and develops performance

 Simplifies internal operations

 Improve administrative efficiency

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