IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/ Chapter 10 Developing and Acquiring Information Systems “Pay attention to what works, and do that.” Tom Anderson, Co- founder of MySpace “Pay attention to what works, and do that.” Tom Anderson, Co- founder of MySpace

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development. 10-2

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development. 10-3

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Customized Vs. Off-the-Shelf Software 10-4 General purpose systems typically purchased off- the-shelf Specific needs often cannot be met by off-the shelf software Companies capitalizing on a first-mover advantage often cannot purchase existing systems  E.g., online retailing (Amazon.com)  Budget air travel (Southwest Airlines)

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Customized Vs. Off-the-Shelf Software 10-5 Customized software  Developed in-house or contracted to a specialized vendor  Customizability  Fit with business operations, culture, etc.  Problem specificity  Company only pays for features actually needed

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Customized Vs. Off-the-Shelf Software 10-6 Off-the-shelf software  Packaged  No specific tailoring  Less costly  Faster to procure Combining customized and off-the-shelf software  Various options

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 The Need for Structured Systems Development 10-7 Systems analysis and design  Process of designing, building, and maintaining information systems  Systems analyst  One of the best jobs (US News and World Report)  High growth rates (>29%) Early IS development  Very unstructured  Programmer skills varied

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Information Systems Development (cont’d) s  Evolution from IS development as “art” to IS development as “discipline”  Software engineering  Benefits  Easier to train systems analysts  Systems would be easier to maintain

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 IS Development in Action 10-9 Structured process moving through steps Problem decomposition  Problems broken up into simpler, smaller pieces

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 The Role of Users in Systems Development Process Systems users are involved in all phases of system’s development process Mutually respectful relationship necessary Organizational members need to understand the development activities well

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Steps in the Systems Development Process Systems development life cycle (SDLC)  Systems development goes through a cycle  Once completed, a systems moves into an ongoing maintenance phase that parallels the initial development process

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Phase 1: Systems Planning and Selection 10-13

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Phase 1: Systems Planning and Selection Identify and select potential projects  Projects critical to mission, goals, and objectives  Selection process varies among organizations  Formal information systems planning process  Ad hoc process  Different focus of projects based on selection source

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Evaluation Criteria for Systems Projects Different criteria may be used to evaluate projects  Usually multiple criteria examined for each project

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Phase 2: Systems Analysis 9-16 Designers gain understanding of current processes

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Key Elements to Development of a System

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Collecting System Requirements Arguably the most important activity Requirements collected from:  Users  Managers  Business processes  Documents System requirements collection techniques:  Interviews  Questionnaires  Observations  Document analysis

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Critical Success Factors Methodology Critical success factor (CSF)  Something that must go well to ensure success Systems analyst interviews individuals to identify their CSFs Organization-wide CSFs are identified

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Critical Success Factors Methodology (cont’d) Strengths and weaknesses of the CSF approach

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Joint Application Design (JAD) Special type of group meeting Reduced time for requirements collection

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Strengths and Weaknesses of the JAD Approach 10-22

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Modeling Data Systems analysts need to understand what data will be collected  Data modeling tools  Entity-relationship diagram

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Modeling Processes and Logic Data flows  Movement of data through an organization

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Processing Logic The way in which data are transformed  Often expressed in pseudocode  Independent of programming language used

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Phase 3: System Design 10-26

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Designing the Human-Computer Interface Human-computer interface  The point of contact between a system and its users  Text-based or graphical  Graphical user interface (GUI) Data entry forms Management reports

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Designing Forms Forms are business documents  Contain some data  Collect additional data

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Designing Reports Reports are business documents that contain only predefined data for viewing or printing

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Designing Databases and Files Data modeling tools used for gaining understanding  Conceptual model — ERD  Physical data model—more detailed

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Designing Processing and Logic Steps and procedures that transform raw data inputs into new or modified information  Pseudocode  Structure charts  Decision trees  Programming code

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Phase 4: System Implementation and Operation Transformation of design into a working information system

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Software Programming and Testing Programming  Transforming the system design into a working computer system  Processing and testing should occur in parallel Tests conducted before system completion

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 System Conversion Installation of the new system

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Documentation Information system documentation  Details of the inner workings of the system  Written by programmers User-related documentation  Written by professional technical writers  User and reference guides  User training and tutorials  Installation procedures and troubleshooting suggestions

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 User Training and Support Self-paced training and tutorials the least expensive One-on-one training the most costly Ongoing education may be necessary

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 System Maintenance Typically starts after software is installed The largest part of system development effort occurs at this stage

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Types of Software Maintenance Corrective maintenance given highest priority  Most likely to occur after initial system installation  Patch management systems help with fixing software bugs

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Prototyping Used for development of less structured information systems  Hard to specify  Constantly changing Trial-and-error approach

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Rapid Application Development Four-phase system development methodology  Requirements planning  User design  Construction  Move to the new system RAD becomes radical in phase 2; intensive user involvement System builders cycle between phases 2 and 3 until system is built

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Object-Oriented Analysis and Design (OOA&D) Development done in terms of common modules (objects) Combines:  the “what” (data) with  the “how” (operations to be performed) OOA&D diagrams help in integrating various aspects of the system Preexisting objects can be used or adapted  Quick and simultaneous design and implementation of objects

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Example: OOA&D Tool 10-43

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Strengths and Weaknesses of Prototyping, RAD, and OOA&D Approaches try to overcome the limitations of a traditional SDLC

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Need for Alternatives to Building Systems Yourself Building systems in-house is always an option, unless you are faced with:  Situation 1: Limited IS staff  Staff may be too small  Staff may be occupied in other ways  Staff not capable of developing the system without additional hiring  Situation 2: IS staff has limited skill set  Many organizations have outside groups manage their Web sites Take advantage of specialized skills

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Situations When In-House Systems Development Does Not Work  Situation 3: IS staff is overworked  Staff does not have time to work on all required systems  Situation 4: Problems with performance of IS staff  Derailed IS departments Staff turnover Changing requirements Shifts in technology Budget constraints

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Learning Objectives 1. Understand the process used by organizations to manage the development of information systems. 2. Describe each major phase of the systems development life cycle: systems planning and selection; systems analysis; systems design; systems implementation and operation. 3. Describe prototyping, rapid application development, and object-oriented analysis and design, along with each approach’s strengths and weaknesses. 4. Understand the factors involved in building a system in-house, along with situations in which it is not feasible. 5. Explain three alternative systems development options: external acquisition, outsourcing, and end- user development

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/ External Acquisition Purchasing an existing system is similar to the process of deciding which car best meets your needs

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Steps in External Acquisition Competitive bid process (find the best system for lowest possible price) 1.Systems planning and selection 2.Systems analysis 3.Development of a request for proposal 4.Proposal evaluation 5.Vendor selection First two steps similar to SDLC

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Development of a Request for Proposal A report detailing system requirements sent to prospective vendors  Invitation to present bids for the project  Often set up in the form of a Web site Areas covered in an RFP

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Proposal Evaluation An assessment of proposals received from vendors  May include system demonstrations  System benchmarking  Standardized tests to compare different proposed systems  Common system benchmarks Response time given a specified number of users Time to sort records Time to retrieve a set of records Time to produce a given record Time to read in a set of data

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Commonly Used Evaluation Criteria 10-53

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Vendor Selection Usually more than one system will meet the criteria  Important to communicate with vendors regarding criteria beforehand Need to prioritize/rank the proposed systems  Best ranking system is chosen

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Managing Software Licenses Permissions and rights that are imposed on applications  Legal and ethical implications of using unlicensed software  Shrink-wrap licenses  For generic off-the-shelf applications  Click-wrap licenses for downloaded software  Enterprise licenses  Volume licenses  Software asset management  Helps organizations to better manage the software infrastructure and avoid legal problems

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Managing Software Licenses 10-56

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Application Service Providers (ASP) ASPs provide software as a service (SaaS)  Reduced cost of installation and maintenance  Variable fee based on actual use of services

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/ Outsourcing Systems Development Turning over responsibility for some or all of an organization’s IS development and operations to an outside firm  Your IS solutions may be housed in their organization  Your applications may be run on their computers  They may develop systems to run on your existing computers (within your organization)

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Why Outsourcing? Cost and quality concerns— higher quality or lower cost systems may be available through outsourcing Problems in IS performance— IS departments might have problems meeting acceptable standards Supplier pressure —aggressive sales force convinces senior management to outsource IS functions Simplifying, downsizing, and reengineering— focusing on core competencies

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Why Outsourcing? (cont’d) Financial factors— liquidation of IT assets Organizational culture— external IS groups devoid of political ties Internal irritants— external IS group may be better accepted by other organizational users

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Managing the IS Outsourcing Relationship Ongoing management of an outsourcing alliance needed 1. Strong, active CIO and staff 2. Clear, realistic performance measurements of the system 3. Multiple levels of interface between customer and outsourcer Full-time relationship managers should be assigned

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Not All Outsourcing Relationships Are the Same Outsourcing relationships  No longer just a legal contract  Different types of outsourcing relationships  Basic relationship—“Cash & Carry”  Preferred relationship—Set preferential pricing  Strategic relationship—Share risks/rewards

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/ End-User Development Growing sophistication of users Actual future users of the system are the system’s developers Application development may be faster  No need to rely on external entities

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Benefits of End-User Development Cost of labor  Cost can be reduced by just giving the required tools to the users to develop their own applications

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Benefits of End-User Development (cont’d) Long development time  User needs may change between the request for proposals and implementation of system  System becomes obsolete before implementation  End-user development may “skip” the queue  Provide more timely systems

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Benefits of End-User Development (cont’d) Modifications and updates  End-user system development may be better at responding to changing needs  No need to wait for IS staff to make updates

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Benefits of End-User Development (cont’d) Reduce work overload  Increase “development staff” by shifting work load to end users

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Encouraging End-User Development Fourth-generation development tools have made end-user development easier

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 End-User Development Pitfalls Users may not be aware of software development standards  Need for adequate documentation  Error checking  Testing procedures Lack of continuity  End user “developer” may leave the organization  Development efforts duplicated across organizations Loss of employees’ productivity for other tasks  Should salespeople develop applications? Information center (IC)  Can provide oversight over end-user development projects  Provide training in standards  Prevent redundancy

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 End of Chapter Content 10-70

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Opening Case— Managing in the Digital World: Casual Gaming: You, Me, and Wii Wii differs by providing physical element Single player vs. multiplayers  At home in addition to online Targets casual gamers Success with volume Does the process of developing a game differ from developing organizational software?

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Microsoft’s Surface Technology shown on CSI Miami Users grab data with fingers  Natural gestures  Touch Place objects on screen to get information about them  Cell phones  MP3 players

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Conquering Computer Contagion Blue Security  Israel-based Internet security company  Spam messages were returned to the advertiser  6 of the top 10 spammers eliminated Blue Frog’s clients from mailing lists  PharmaMaster fought back  Blue Security was forced to fold the business  “White knights” Top 10 Malware (June 2008)

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 MySpace: Tom Anderson and Chris DeWolfe MySpace—Online bulletin board on steroids Beat out Amazon, eBay, and Google in page views Met during dot-com boom They let the business evolve, rather than having a business plan Word of mouth advertising Bought by Rupert Murdoch in 2005 Anderson has 245 million “friends” in his profile MySpace founders Chris DeWolfe and Tom Anderson.

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Hackers, Patches, and Reverse Engineering Hackers  Break into computer systems to steal or manipulate data  Look for security holes  Study applications until they discover a hole  Follow other hackers’ guidelines  Reverse engineer patches Patches  Released by software producers  Plug security holes How can you deter hackers from reverse engineering patches?

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Adopting New Technology Tech industry needs consumers to adopt new technology Users like to stick with what they know  9 million AOL dial-up users  By 2008, Vista only had 3 percent of OS market IT directors need to follow organization’s tolerance for risk  High risk—Adopt new technology  Low risk—Stick with what organization is using

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Genetic Testing Discrimination based on genetic make-up? 1990—Study showed that roughly 50 percent of people had experienced genetic discrimination  Health insurance companies  Blood banks  Adoption agencies 2008—Genetic Information Nondiscrimination Act

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Broadcasting TV news and Radio have benefited from Internet  News features can be quickly transmitted over the Internet  Closer connection between newsroom and “action” on the field However  Many viewers prefer to obtain news via Internet  Viewers’ shortening attention spans  Requires change of revenue models  Advertisers are less willing to pay high fees for TV advertising  Internet offers more targeted advertising  TV stations can tie advertising to online shows How can TV and radio stations survive the next decade?