A methodology, called M^*, for information system analysis and database design of production environments is presented in detail. The originality of M^* is to recognize the importance of integrating factory analysis methods for data and user requirements definition with logical database design methods for database specification. M^* is a pragmatic, complete, manual methodology involving three major phases: Enterprise Modelling and Analysis which is the phase devoted to accurate analysis of the structure of the enterprise and precise definition of the scope of the future database application; Conceptual Design which is the phase concerned with data modelling of both static and dynamic properties of the enterprise; and Implementation Design which is the phase dealing with adaptation of the conceptual schema to the data model specifications of the physical database system used for application development and tuning performances of the physical system. The methodology is explained and illustrated by means of an example related to a Flexible Manufacturing System for mechanical parts.