2. Chapter 13: Developing and Implementing Effective Accounting Information Systems
Introduction
System Development Life Cycle
Systems Planning
Systems Analysis
Detailed Systems Design
Implementation, Follow-Up, and Maintenance

3. Introduction Purpose of IT Governance Study of IT Systems
Ensure IT is used effectively, efficiently, and strategically
Study of IT Systems
Planning and analysis through development
Design, Development, and Implementation
Maintenance of AIS applications

4. Systems Development Life Cycle
Systems Study
Systems Development Work
Formal investigation of an existing information system
Performance of Study
In-house professionals (large organizations)
Hire outside consultants (smaller companies)

5. Four Stages in the Systems Development Life Cycle
Planning and Investigation
Preliminary investigation of current system
Organize a systems study team
Develop strategic plans
Analysis of Current System
Identify information needs
Strengths and weaknesses

6. Four Stages in the Systems Development Life Cycle
Design
Changes that eliminate weak points
Preserve the strengths
Implementation, Follow-up, and Maintenance
Resource acquisition
Training employees
Identify new problems and correct

7. Systems Development Life Cycle

8. Study Break #1
Which one of the four stages in the Systems Development Life Cycle is likely to be most costly for a new system?
Planning and Investigation
Analysis
Design
Implementation, Follow-up, and Maintenance

9. Systems Planning Planning for Success
Approach specific organizational problems from a broad point of view
Use an interdisciplinary study team for evaluation of systems
Study team works closely with steering committee
Broad Viewpoint in a Systems Study
Align study with mission and strategic goals and objectives

10. Systems Planning The Study Team and the Steering Committee
Interdisciplinary study team
Communicate closely with management
Appoint a steering committee
Investigating Current Systems
Preliminary investigation to identify issues
Consider alternatives
Make recommendations

11. Systems Analysis Purpose Study Team Activities
Become familiar with current system (AS-IS system)
Identify inputs and outputs
Identify strengths and weaknesses
Make recommendations (TO-BE system)
Study Team Activities
Identify and understand system goals
Perform a systems survey
Report findings

12. Systems Analysis Procedures

13. Understanding Organizational Goals
General Systems Goals
Benefits should exceed the costs
Create output that helps make better decisions
Allows for optimal access to information
Accommodates changing information needs

14. Understanding Organizational Goals
Top Management Systems Goals
Long-range budget planning data
Periodic performance reports
Short-range operating performance
Operating Management Systems Goals
Well-defined narrow organization areas
Current year decisions

15. Systems Survey Work Systems Survey
Allows for a more complete understanding
Strengths and weaknesses of current system
Understanding the Human Element and Potential Behavioral Problems
Employee resistance to change
Gain full cooperation and support

16. Systems Survey Work Data Gathering
Review existing documentation or create new materials
Observe the current system in operation
Use questionnaires and surveys
Review internal control procedures
Interview systems participants

17. Information Gathering Strategies
Document Analysis
Observation
Questionnaires
Interviews
Joint Application Design (JAD) sessions

18. Systems Survey Questionnaire

19. Data Analysis Components Time Period Conclusions
Create summary statistics
Systems documentation
Time Period
Longer than preliminary investigation
May provide interim reports
Conclusions
Final systems analysis report
Submit to steering committee

20. Evaluating System Feasibility
Technical Feasibility
Required technical resources
Technical skills of current employees
Operational Feasibility
Compatibility with current environment
Capabilities of current employees

21. Evaluating System Feasibility
Schedule Feasibility
Estimate time needed for implementation
Legal Feasibility
Conflicts between system and legal obligations
Economic Feasibility
Cost-benefit analysis
Difficulties estimating implementation costs

22. Steps in the Systems Design Phase

23. Detailed Systems Design
Designing System Outputs, Processes and Inputs
Prototyping
The Systems Specifications Report
Choosing an Accounting Information System
Outsourcing

24. Detailed Systems Design

25. Designing System Outputs, Processes, and Inputs
Determine necessary outputs and format
Create better outputs
Hard-copy versus Soft-copy
Process Design
Identify necessary processing procedures
Utilize tools to model computer processes

26. Designing System Outputs, Processes, and Inputs
Designing System Inputs
Identify and describe data elements
Specify how data items must be coded
Determine source of each data element
Streamline data entry tasks

27. Prototyping Concepts Usefulness and Challenges
Develop a simplified model of proposed system
Scaled-down, experimental version
Usefulness and Challenges
Helps address issues of challenging projects
Can create distrust and perception concerns
Not recommended for traditional AIS applications

28. Steps in Prototyping

29. The Systems Specifications Report
Summary of findings
Submitted to steering committee for review, comment, and approval
The Make-or-Buy Decision
Develop system within the organization
Outsource development of system
Canned software or Turnkey system

30. Choosing an AIS Selection Criteria
The performance capability of each proposed system
Costs and benefits of each proposed system
Maintainability of each proposed system
Compatibility of each proposed system with existing systems
Vendor support

31. Choosing an AIS Point-Scoring Analysis Selecting a Finalist
Used to evaluate possibly solutions
Identifies point value for each criteria
Selecting a Finalist
Making a Final Decision

32. Point-Scoring Analysis

33. Outsourcing Business Process Outsourcing Knowledge Process Outsourcing
Wide range of possible activities
Routine function to entire operation
Knowledge Process Outsourcing
Contract to perform research or other knowledge-related work

34. Outsourcing Advantages Disadvantages
Company can focus on core competencies
More efficient use of time and resources
Cost savings
Disadvantages
Inflexibility of contractual relationships
Loss of control
Loss of competitive advantages

35. Implementation, Follow-Up, and Maintenance
Implementation Activities
Managing IT Implementation Projects
Postimplementation Review
System Maintenance

36. Implementation Activities
Prepare the physical site
Determine functional changes
Select and assign personnel
Train personnel
Acquire and install computer equipment

37. Implementation Activities
Establish internal controls
Convert data files
Acquire computer software
Test computer software
Convert to the new system

38. Managing IT Implementation Projects
Project Management Software
Operates on desktop or notebook computers
Aids in the management of implementation projects
Divides project into simpler activities
Estimates time and cost of activities

39. Postimplementation Review
Reevaluate new system’s effectiveness
Talk with personnel about satisfaction levels
Talk with end users about satisfaction levels
Evaluate control procedures and effectiveness
Observe employee work performance
Evaluate computer processing functions
Determine output schedule timing and effectiveness

40. System Maintenance System Maintenance Responsibilities
Performed by IT function
Continues tasks created by initial follow-up study
Responsibilities
Identify errors and anomalies
Estimate costs of fixing items
Perform necessary modifications

41. System Maintenance Costs

42. Study Break #4
Prototyping, as an IT development approach, has both advantages and disadvantages. In general, prototyping is most appropriate when:
The design team is not pressed for time in creating a new system
Users have a thorough understanding of their information needs
There are high risks associated with developing an implementing an ineffective system
System requirements are easily defined