CHAPTER 12

Acquiring Information Systems and Applications

CHAPTER OUTLINE

12.1 Project Management for Information System Projects

12.2 Planning for and Justifying IT Applications

12.3 Strategies for Acquiring IT Applications12.4 The Traditional Systems Development Life

Cycle12.5 Alternative Methods and Tools for

Systems Development12.6 Vendor and Software Selection

12.1 Project Management for Information Systems Projects Project Information System Project Management The Triple Constraints

An IS Project Gone Astray

The Project Management Process

Project Initiation Project Planning Project Execution Project Monitoring and Control Project Completion

12.2 Planning for and Justifying IT Applications

Organizations must analyze the need for the IT application.

Each IT application must be justified in terms of costs and benefits.

The application portfolio

Information Systems Planning Process

Information Systems Planning (continued)

Organizational strategic plan IT architecture Both are inputs in developing the IT strategic

plan.

IT Steering Committee

The IT Steering Committee

IS Operational Plan

Contains the following elements: Mission IT environment Objectives of the IT function Constraints of the IT function Application portfolio Resource allocation and project management

Evaluating & Justifying IT Investment: Benefits, Costs & Issues Assessing the costs

Fixed costs Total cost of ownership (TCO)

Assessing the benefits (Values) Intangible benefits: Benefits from IT that may

be very desirable but difficult to place an accurate monetary value on.

Comparing the two

Conducting the Cost-Benefit Analysis

Using Net Present Value (NPV) Return on investment Breakeven analysis The business case approach

12.3 Strategies for Acquiring IT Applications

Buy the applications (off-the-shelf approach) Lease the applications Software-as-a-Service Use Open-Source Software Outsourcing Developing the applications in-house

Operation of an Application Service Provider (ASP)

ASP Data Center

CustomerA

Application

CustomerB

Application

CustomerC

Application

Database Database Database

Operation of a Software-as-a-Service (SaaS) Vendor

SaaS Vendor Data Center

CustomerA

CustomerB

CustomerC

CustomerA

CustomerB

CustomerC

Application

12.4 Traditional Systems Development Life Cycle

Software Development Life Cycle (SDLC) is the traditional systems development method that organizations use for large-scale IT projects.

Prototyping

Six-Stage Systems Development Life Cycle (SDLC) with Supporting Tools

Systems Investigation

Deliverable: Go/No Go Decision

Systems Analysis

Deliverable: User Requirement

Systems Design

Deliverable: Technical Specification

Programming and Testing

ImplementThe

System

Operation and Maintenance

Business Need

Joint Application

Design (JAD)

Upper CASE Tools

Lower CASE Tools

Traditional SDLC Processes

Systems investigation Systems analysis Systems design Programming and testing Implementation Operation and maintenance

The SDLC

Major advantages Control Accountability Error detection

Major drawbacks Relatively inflexible Time-consuming and expensive Discourages changes once user requirements

are done

SDLC – Systems Investigation

Begins with the business problem (or opportunity) followed by the feasibility analysis.

Feasibility study Deliverable: Go/No-Go Decision

Feasibility Study

Technical feasibility Economic feasibility Organizational feasibility Behavioral feasibility

SDLC – System Analysis

Is the examination of the business problem that the organization plans to solve with an information system.

Main purpose is to gather information about the existing system to determine the requirements for the new or improved system.

Deliverable is a set of system requirements, also called user requirements.

SDLC – Systems Design

Describes how the system will accomplish this task.

Deliverable is the technical design that specifies: System outputs, inputs, user interfaces. Hardware, software, databases,

telecommunications, personnel & procedures. Blueprint of how these components are

integrated.

SDLC – System Design (continued)

Scope creep is caused by adding functions after the project has been initiated.

SDLC – Programming & Testing

Programming involves the translation of a system’s design specification into computer code.

Testing checks to see if the computer code will produce the expected and desired results under certain conditions.

Testing is designed to delete errors (bugs) in the computer code.

SDLC – Systems Implementation

Implementation involves three major conversion strategies: Direct Conversion Pilot Conversion Phased Conversion Parallel Conversion (not used much today)

SLDC – Operation & Maintenance

Audits are performed to assess the system’s capabilities and to determine if it is being used correctly.

Systems need several types of maintenance. Debugging Updating Maintenance

12.5 Alternative Methods & Tools for Systems Development

Prototyping Joint application design (JAD) Integrated computer-assisted software

engineering tools Rapid application development (RAD) Agile development End-user development Component-based development Object-oriented development

RAD versus SDLC

12.6 Vendor & Software Selection

Step 1: Identify potential vendors. Step 2: Determine the evaluation criteria.

Request for proposal (RFP) Step 3: Evaluate vendors and packages. Step 4: Choose the vendor and package Step 5: Negotiate a contract. Step 6: Establish a service level agreement.