AIS Development Strategies

1. AIS Development Strategies Chapter 19

2. METHODS FOR OBTAINING A NEW INFORMATION SYSTEM • Purchasing prewritten software • Developing software in-house • Outsourcing

3. PURCHASING PREWRITTEN SOFTWARE • Canned software is sold on the open market to a broad range of users with similar requirements. • Turnkeysystems - hardware and software sold together as a package. • Disadvantages: • Inflexibility • May not meet all of the company’s needs

4. PURCHASING PREWRITTEN SOFTWARE • Application service providers (ASPs). • ASPs host web-based software and deliver it to clients over the Internet. • Companies don’t have to buy, install, or maintain canned software; they simply “rent” it. • Advantages of ASPs: • Reduction of software costs and administrative overhead. • Automated software upgrades. • Scalability as the business grows. • Global access to information. • Access to skilled IT personnel. • Ability to focus on core financial competencies rather than IT.

5. PURCHASING PREWRITTEN SOFTWARE • Purchasing Software and the SDLC: • SDLC is still followed for purchased software: • Systems analysis • Conceptual design • Physical design • Implementation and conversion • Operation and maintenance

6. PURCHASING PREWRITTEN SOFTWARE • Acquiring Hardware and Software • Request for proposal (RFP) - invitation to bidders to propose a system by a specific date. • Each proposal is evaluated. • Finalists are investigated in depth. • Advantages • Saves time • Simplifies the decision-making process • Reduces errors • Avoids potential for disagreement

7. PURCHASING PREWRITTEN SOFTWARE • Evaluating Proposals and Selecting a System • Eliminate any proposals that: • Are missing important information. • Fail to meet minimum requirements. • Are ambiguous. • Those that pass the preliminary screening should be compared with the proposed AIS requirements to determine: • If they meet all mandatory requirements. • How many desirable requirements they meet.

8. PURCHASING PREWRITTEN SOFTWARE • Criteria to evaluate hardware include: • Cost • Ability to run required software • Processing speed and capabilities • Secondary storage capability • Input and output speeds • Communication capabilities • Expandability • Recency of technology • Availability • Compatibility with existing hardware, software, and peripherals • Performance compared to competitors • Cost and availability of support and maintenance • Warrantees and guarantees • Financing arrangements • Ability to meet mandatory requirements

9. PURCHASING PREWRITTEN SOFTWARE • Criteria to evaluate software include: • Conformity with specifications • Need for modification • Performance (speed, accuracy, reliability) • Use by other companies • Satisfaction of other users • Documentation • Compatibility with existing software • User-friendliness • Ability to be demonstrated and test-driven • Warranties • Flexibility and maintainability • Capability for online inquiry of files and records • Vendor upgrades

10. PURCHASING PREWRITTEN SOFTWARE • Criteria to evaluate vendors include: • Size • Financial stability and security • Experience • Quality of support and warranties • Regularity of updates • Ability to provide financing • Willingness to sign contract • Willingness to provide references • Reputation for reliability and dependability • Hardware and software support and maintenance • Implementation and installation support • Quality and responsiveness of personnel • Willingness to provide training • Responsiveness and timeliness of support

11. PURCHASING PREWRITTEN SOFTWARE • Approaches to comparing system performance: • Benchmark problem • Point scoring • Requirements costing

12. PURCHASING PREWRITTEN SOFTWARE • EXAMPLE: • Zorba Co. is evaluating systems offered by three different vendors: Able Co., Baker Co., and Cook Co. • Zorba has determined three criteria that they will use to evaluate the different systems: cost, speed, and vendor reliability. • They have provided the following weights to each criteria, with vendor reliability being the most critical: • Vendor reliability—9 • Cost—6 • Speed—4

13. PURCHASING PREWRITTEN SOFTWARE • Zorba examined the packages offered by the three vendors and rated them based on these three criteria. Ratings were from 1-5 with 5 being the highest score.

14. PURCHASING PREWRITTEN SOFTWARE • The weighted scores are then computed by multiplying the rating given to each vendor on each criterion times the weight assigned to that criterion. X =

15. PURCHASING PREWRITTEN SOFTWARE • The weighted scores for each company are summed: • Able = 60 points • Baker = 79 points • Cook = 68 points • Based on the preceding scores, the bid would probably be awarded to Baker Co.

16. PURCHASING PREWRITTEN SOFTWARE • Approaches to comparing system performance: • Benchmark problem • Point scoring • Requirements costing

17. DEVELOPING SOFTWARE IN-HOUSE • Reasons: • Their requirements are unique; or • Their size and complexity necessitates a custom package. • Disadvantages • Lack of time. • Complexity of desired system. • Poor requirements and systems planning. • Inadequate communication and cooperation between departments and users. • Lack of qualified staff. • Poor senior executive support.

18. DEVELOPING SOFTWARE IN-HOUSE • Control the development process and observe the following guidelines: • Carefully select a developer • Sign a contract to clearly define responsibilities • Plan and monitor each step • Maintain effective and frequent communication • Control all costs

19. DEVELOPING SOFTWARE IN-HOUSE • End-User Developed Software • Hands-on development, use, and control of computer-based information systems by users • Allows individuals use IT to meet their own IS needs rather than rely on systems professionals • Factors contributing to EUC are: • Increased computer literacy. • Easier-to-use programming languages. • Inexpensive PCs. • A variety of powerful and inexpensive software packages.

20. DEVELOPING SOFTWARE IN-HOUSE • EUC’s allows users to develop their own systems to: • Create and store data. • Access and download company data. • Share data and computer resources in networks.

21. DEVELOPING SOFTWARE IN-HOUSE • EUD may be most appropriate for tasks such as : • Querying company databases to produce simple reports • Performing “what if,” sensitivity or other statistical analyses • Developing applications for prewritten software • Preparing schedules and lists

22. DEVELOPING SOFTWARE IN-HOUSE • Benefits of end-user computing: • User creation, control, and implementation • Systems that meet user needs • Timeliness • Freeing up systems resources • Versatility and ease of use

23. DEVELOPING SOFTWARE IN-HOUSE • Risks of end-user computing: • Logic and development errors • Inadequately tested applications • Inefficient systems • Poorly controlled and documented systems • System incompatibilities • Duplication of systems and data and wasted resources • Increased costs

24. OUTSOURCE THE SYSTEM • Outsourcingis hiring an outside company to handle all or part of an organization’s data processing activities. • Examples of outsourced activities: • Installation • Training • Maintenance • Help desk • Technical support

25. OUTSOURCE THE SYSTEM • Multiple companies are used in order to: • Increase flexibility • Increase competition • Reduce costs • Activities that are not outsourced: • Strategic management of their IT environment • Business process management • IT architecture

26. OUTSOURCE THE SYSTEM • Benefits of outsourcing: • Provides a business solution • Asset utilization • Access to greater experience and more advanced technology • Lower costs • Improved development time • Elimination of peaks-and-valleys usage • Facilitation of downsizing

27. OUTSOURCE THE SYSTEM • Risks of outsourcing: • Inflexibility • Loss of control • Reduced competitive advantage • Locked in system • Unfulfilled goals • Poor service

28. METHODS FOR IMPROVING THE DEVELOPMENT PROCESS • Business process reengineering • Prototyping • Computer-aided software engineering (CASE) tools

29. BUSINESS PROCESS REENGINEERING • Business process reengineering (BPR) is the analysis and redesign of business processes and information systems to achieve significant performance improvements. • Reduces a company to its essential business processes • Reshapes organizational work practices and information flows to take advantage of technological advancements.

30. BUSINESS PROCESS REENGINEERING • Michael Hammer’s principles for reengineering business processes: • Organize around outcomes, not tasks. • Require those who use the output to perform the process. • Require those who produce information to process it. • Centralize AND disperse data. • Integrate parallel activities. • Empower workers, use built-in controls, and flatten the organization chart. • Capture data once—at its source.

31. BUSINESS PROCESS REENGINEERING • Challenges Faced by Reengineering Efforts: • Tradition • Resistance • Time and cost requirements • Lack of management support • Skepticism • Retraining • Controls

32. PROTOTYPING • Prototyping is an iterative approach to systems design in which a simplified working model of a system is developed. • Developers who use prototyping still go through the systems development life cycle.

33. PROTOTYPING • Four steps are involved in developing a prototype: • STEP ONE: Identify basic requirements • STEP TWO: Develop an initial prototype • STEP THREE: Repeated iterations • STEP FOUR: Use the system

34. PROTOTYPING • Changes may be necessary to allow the program to: • Accept real input. • Access real data files. • Process data. • Make necessary computations and calculations. • Produce real output.

35. PROTOTYPING • When to Use Prototyping • Users don’t fully understand their needs, or the needs change rapidly • System requirements are difficult to define • System inputs and outputs are not known • The task to be performed is unstructured or semi-structured • Designers are uncertain about what technology to use • The system is crucial and needed quickly • The risk of developing the wrong system is high • The users’ reactions to the new system are important development considerations • Many design strategies must be tested • The design staff has little experience developing this type of system or application • The system will be used infrequently so that processing efficiency is not crucial

36. PROTOTYPING • Advantages of Prototyping: • Better definition of user needs • Higher user involvement and satisfaction • Faster development time • Fewer errors • More opportunity for changes • Less costly

37. PROTOTYPING • Disadvantages of Prototyping: • Significant user time • Less efficient use of system resources • Incomplete system development • Inadequately tested and documented systems • Negative behavioral reactions • Never-ending development

38. Computer-Aided Software Engineering (CASE) Tools • Computer-aided software (or systems) engineering (CASE)tools are an integrated package of computer-based tools that automate important aspects of the software development process. • Used to plan, analyze, design, program, and maintain an information system

39. Computer-Aided Software Engineering (CASE) Tools • Advantages of CASE technology: • Increased productivity • Improved program quality • Cost savings • Improved control procedures • Simplified documentation

40. Computer-Aided Software Engineering (CASE) Tools • Problems with CASE technology: • Incompatibility • Cost • Unmet expectations

41. SUMMARY • We have: • Discussed how organizations buy software, hardware, and vendor services. • Explained how information systems departments develop custom software. • Identified how end users develop, use and control computer-based information systems. • Explained why organizations outsource their information systems, as well as the benefits and risks of doing so. • Discussed what reengineering processes entail and when they are appropriate. • Explained how prototypes are used to develop an AIS and when it is advantageous to do so. • Described what computer-aided software engineering is and how it’s used in systems development.