What is one of the ways of converting from an old information system to a new information system?

Conversion is the process of changing from the old system to the new one. It must be properly planned and executed. Four methods are common in use. They are: parallel systems, direct conversion, pilot system and systems phase-in. Each method should be considered in the light of the opportunities that it offers and problems that it may create.

However, it may be possible that sometimes, we may be forced to apply one method over others, even though other methods may be more beneficial. In general, systems conversion should be accomplished in shortest possible time. Long conversion periods create problems for all persons involved including both analysts and users.

Parallel Systems

The most secure method of converting from an old to new system is to run both systems in parallel. Under this approach, users continue to operate the old system in the usual manner but they also start using the new system. This method is the safest one because it ensures that in case of any problems in using the new system, the organisation can still fall back to the old system without loss of time and money.

The disadvantages of the parallel systems approach are:

  • It doubles operating costs.
  • The new system may not get fair trial.

Direct Conversion

This method converts from the old to the new system abruptly, sometimes over a weekend ( even overnight. The old system is used until a planned conversion day, when it is replaced by the new system. There are no parallel activities. The organisation relies fully on the new system. The main disadvantages of this approach are: no other system to fall back on, if difficulties arise with new system. Secondly, wise and careful planning is required.

Pilot System

Pilot approach is often preferred in the case of the new system which involves new techniques or some drastic changes in organisation performance. In this method, a working version of the system is implemented in one part of the organisation, such as a single work area or department. The users in this area are aware that they are piloting a new system and that changes can be made to improve the system. Based on the feedback, changes are made and the system is installed in the remaining departments of the organisation, either all at on (direct conversion method) or gradually (phase-in method). This approach provides experience and live test before implementation.

Phase-in Method

This method is used when it is not possible to install a new system throughout an organisation all at once. The conversion of files, training of personnel or arrival of equipment may force the staging of the implementation over a period of time, ranging from weeks to months. It allows some users to take advantage of the new system early. Also it allows training and installation without unnecessary use of resources.

Systems Management

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Many small businesses start with a basic, inexpensive software package that meets their minimum requirements. As your business grows and technology advances, you might find that you need to upgrade your accounting information system so that you can extract the most meaningful data to make sound financial decisions. Four basic approaches exist for system conversions, and you might need to combine more than one method.

Run the New System Parallel to the Old

  1. Running parallel means that you continue to use your old system while using the new system at the same time. This allows you to train employees on the new system and to fix any problems with the new program. After you are comfortable that the new system is producing accurate reports, you discontinue use of the old system. The main disadvantage to this approach is that data may have to be entered into each system separately, especially if it is necessary to make changes to the structure of your databases, such as switching from a three-digit account number to a four-digit account number. This might result in higher labor costs, either in the form of overtime or temporary help.

Phase in the New System

  1. You might decide to implement the conversion in phases. For example, you might convert your accounts payable department first. After you are satisfied that the new system is working correctly, you might then convert inventory, accounts receivable and general ledger functions gradually. You might also choose to convert one location at a time to the new system. The primary drawback to phasing in the new system is that the final conversion might take more time, and you will likely need to run the selected modules or locations parallel during that time.

Use One Site as a Pilot Site

  1. If you have more than one location, you might choose a site to act as the pilot location. The pilot site converts in whatever manner you choose. Once you are comfortable that the new system is working correctly, you switch all other locations to the new program. If all of your locations have identical needs, this method might be the most cost-effective choice. However, if the needs of the locations differ, you might not be satisfied with the results. For example, your pilot location might need three decimal places in its cost accounting module, but another location might need five. One location might be able to get by with 12 product classes, but another might need a minimum of 20.

Direct Changeover

  1. You might be able to download your files from your old system directly to the new in what is called a direct changeover. After reviewing files to make sure that they transferred correctly, you stop using the old system and all employees begin using the new system. This method typically works best if there are minimal changes, such as converting to a program that is nearly identical but allows you to purchase the number of licenses you now need or that adds a new module, such as a perpetual inventory function.