CHAPTER 13 Acquiring Information Systems and Applications
13.1 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.
Information Systems Planning
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.
Conducting the Cost-Benefit Analysis Using Net Present Value (NPV) Return on investment Breakeven analysis The business case approach
Strategies for Acquiring IT Applications Purchase an Application Customize an Application Lease the applications Application Service Providers and Software as-a-Service Vendors Use Open-Source Software Outsourcing Custom Development
Prototyping Six-Stage Systems Development Life Cycle (SDLC) with Supporting Tools Systems Investigation Deliverable: Go/No Go Decision Systems Investigation Deliverable: Go/No Go Decision Systems Analysis Deliverable: User Requirement Systems Analysis Deliverable: User Requirement Systems Design Deliverable: Technical Specification Systems Design Deliverable: Technical Specification Programming and Testing Implement The System Implement The System Operation and Maintenance Operation and Maintenance Business Need Joint Application Design (JAD) Upper CASE Tools Lower CASE Tools
Feasibility Study Technical feasibility Economic feasibility Organizational feasibility Behavioral feasibility
SDLC – Systems Implementation Direct Conversion Pilot Conversion Phased Conversion Parallel Conversion
13.4 Alternative Methods and Tools for Systems Development Joint application design (JAD) Rapid application development (RAD) Agile development End-user development
RAD versus SDLC
Tools for Systems Development Prototyping Integrated computer-assisted software engineering (ICASE) Component-based development Object-oriented development
13.5 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.