Information Systems Acquisition

Acquiring Information Systems Through Projects

• Information systems can be acquired in five basic ways: buying it as is, customizing a purchased system, renting or leasing, building it yourself, or outsourcing.
• Acquiring software applications is different from acquiring an entire information system; there's more to consider than just the software.
• New software must be integrated into the existing technological infrastructure, data (databases), and people/procedures (business processes, organizational context).

Study Questions

• Methods for acquiring information systems are covered in the presentation.

• The Project Management Body of Knowledge (PMBOK) defines a project as a temporary endeavor to create a unique product, service or result, often starting with goals/objectives.

• Projects generally have a start and end date and often represent organizational change.

• IT projects have a large IT component (budget or personnel), a defined scope (objective), and a start and end date.

• IT projects usually involve temporary resource use and the accomplishment of something new.

• IT projects are hard to estimate in terms of time, budget, and scope.

• IT operations involve delivering services, maintaining, protecting, and managing IT infrastructure.

• IT projects usually involve renewing and adapting IT infrastructure.

• IT operations and projects often involve different types of IT professionals, but these fields depend on each other for success.

• IT projects: An illustration provides a visual of the relationships between the IT department components.

• ITIL is a well-known framework of best practices for IT operations.

• ITIL contains numerous management procedures designed to help businesses gain value from IT operations; it has undergone various revisions, with the latest refresh (ITIL V4) released in June 2011.

• The web helps deliver IT services to internal/external customers.

• IT projects are risky due to the difficulty of graphically representing project definitions, the lack of a dependable model, difficulty in estimating, and monitoring project progress.

• Other risks inherent in IT projects include lack of team experience, insufficient top management support, inadequate user participation, unclear requirements, and high technical complexity/environmental changes.

• The systems development life cycle (SDLC) is the classic process for obtaining and maintaining information systems.

• Basic tasks needed for a successful information system are combined into various phases of system development.

SDLC

• The SDLC is a classical five-phase process with these phases: system definition, requirements analysis, component design, implementation, and system maintenance.
• The business planning process initiates the need for systems, and the system definition entails defining the system’s goals, scope, and assessing its feasibility.
• Further assessment includes cost, schedule, technical, and organizational issues.

Phase 1: Defining Systems

• Defining system goals and purpose; facilitating competitive strategy, supporting business processes, and improving decision-making.
• Defining the project's scope.
• Assessing project feasibility (cost, schedule, technical, organizational)
• Forming a project team, and planning the project.

Phase 2: Requirements Analysis

• Forming the project team and developing requirements; scoping.
• Determining/documenting specific features and functions.
• Approving requirements.
• Changing a system in this phase is comparatively less expensive.

How are information systems designed, implemented, and maintained?

• Five methods of acquiring information systems: purchasing (as is), purchasing (customizing), renting/leasing, building, outsourcing.
• For options 1 to 3, the organization must match its requirements with the application's capabilities.
• The presentation includes a visual showing matching business needs to software capabilities.

Phase 3: Component Design

• Analyzing and evaluating alternative designs (accurate requirements needed).
• Hardware is determined by the project team.
• Design depends on the source (off-the-shelf, off-the-shelf with alterations, or custom-developed).
• Creating procedures for normal processing, backup, and recovery operations.
• Creating job descriptions for users and operations personnel.
• The presentation includes a visual that summarizes the SDLC component design phase.

Phase 4: Implementation

• The system must be built, with components built independently.
• Important to document and review the components.
• System testing (unit testing, integrated testing, and testing completed system) is necessary.
• Users must transition to the new system.

System Testing

• A test plan is needed to outline the sequences of user actions during system operation; both normal and abnormal actions must be considered.
• Labor-intensive testing process.
• Includes product quality assurance (PQA).
• Utilizes testing specialists.
• Beta testing (has future users test).

System Conversion

• Converting business activity from the old system to the new system.
• Pilot (limited implementation) – exposes limited boundaries.
• Phased conversion – gradual implementation in stages until the entire organization adopts the new system; testing after each step.
• Cannot be used for tightly integrated systems; this method is not appropriate in such cases.
• Parallel implementation: The new system is operated in parallel with the old one during the testing phase, allowing for easy fallback to the old system if necessary.
• Plunge conversion: The old system is immediately shut down, and the new system is put into use all at once.

Design and Implementation for the Five Components

• A detailed table illustrates the design and implementation process for hardware, software, data, procedures, and people. This includes tasks like determining hardware and software specifications, selecting software, and designing databases and procedures.

Phase 5: Maintenance

• Fixing the system for correct operation or adjusting to requirement changes.
• Establishing processes for monitoring system failures and enhancements is crucial.
• Fixes are prioritized based on severity (high priority fixes grouped into patches; low-priority problems bundled into service packs.

SDLC: System Maintenance Phase

• Recording requests for changes (failures, enhancements).
• Prioritizing requests.
• Fixing failures; implementing patches, service packs, new releases.

Problems With SDLC

• SDLC is a waterfall method (phases don't repeat); however, requirements and/or design phases sometimes need repetition.
• Difficulty in documenting requirements due to analysis paralysis (or uncertain requirements), scheduling and budget challenges, multiyear projects.
• Labour estimations frequently result in insufficient budgets.

What is outsourcing, and what are application service providers?

• Outsourcing entails hiring another organization to perform a specific service.
• Vendors may be domestic or international (offshoring).
• Application service providers (ASPs) are a type of outsourcing where an organization contracts with a vendor.
• Payments are frequently monthly or yearly depending on the number of users (or employees).

Reasons for Outsourcing

• Gaining expertise, reducing costs, and mitigating development risk.

Outsourcing Risks

• Loss of control (vendor in the driver's seat), potential loss of intellectual capital, product fixes/enhancements with wrong priority, vendor management issues/identity changes, high unit cost, mismanagement, vendor becoming a de facto sole source, lack of clear exit strategy, expenses related to switching vendors.

Application Service Providers (ASPs)

• ASP agreements involve an organization contracting with a vendor to rent applications (fee-for-service basis).
• Vendor usually maintains the system on their website, and access happens through the vendor's platform.
• Payments are generally monthly or yearly based on user/employee count.

This quiz covers the different methods of acquiring information systems, including purchasing, customizing, leasing, building, and outsourcing. It also highlights the importance of integration with existing infrastructure and the role of project management in IT projects. Test your understanding of these crucial concepts.