Describes the top-down and bottom-up approaches to designing large, complex management information systems and recommends, instead, a phased prototype development strategy, focusing resources on several critical subsystems at a time. Some redesigning and reprogramming of parts may be needed, but total cost will still be lower. Flexibility is essential: rent rather than buy; get modular, program-compatible equipment with excess core capacity; modify procedures to fit canned routines and systems; audit performance and tune the system; and return unneeded equipment. Top-down design based on system analysis requires strong management participation and time and data often not available. Bottom-up design is simpler, but trouble comes later in trying to make the system work, because equipment is selected without studying management needs or considering all interactions. To avoid this, the project group must include both functional and computer experts, and top management must review development to assure a cross-function view. 14 pp.