Information Systems Acquisition Strategies

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Questions and Answers

What is the main benefit of custom development in acquiring information systems?

It guarantees a faster deployment of applications.

It reduces the overall cost of acquisition.

It requires fewer resources compared to outsourcing.

It allows for a better fit with the organization’s processes. (correct)

What is a significant risk associated with offshoring?

Limited availability of skilled labor.

Communication issues and data privacy concerns. (correct)

Incompatible software solutions.

Higher costs than domestic sourcing.

Which of the following factors should organizations consider when deciding how to acquire IT applications?

Speed of software updates.

Sensitivity of the data and organizational processes. (correct)

The color scheme of the software interface.

The number of employees in the organization.

What term is used to describe outsourcing IT functions to a company in a different country?

Offshoring Signup and view all the answers

Which strategy involves a third-party company managing software applications for a client organization?

Outsourcing Signup and view all the answers

What is the main purpose of maintenance in the system development life cycle (SDLC)?

To perform changes and upgrades ensuring business goals are met Signup and view all the answers

Which type of maintenance focuses on enhancing a system's performance?

Perfective maintenance Signup and view all the answers

What is a significant drawback of the Waterfall methodology?

It assumes all requirements can be specified at the beginning Signup and view all the answers

Which of the following is not a type of maintenance in the SDLC?

Adaptive repair Signup and view all the answers

What is the success rate of projects following the Waterfall methodology, according to the information provided?

10% Signup and view all the answers

What is the purpose of an IS Strategic Plan?

To align IT initiatives with organizational goals Signup and view all the answers

What is one of the objectives of a well-structured IS Strategic Plan?

To ensure the IT architecture connects various components seamlessly Signup and view all the answers

What does the IS Operational Plan focus on?

Execution of projects supporting the IT strategic plan Signup and view all the answers

Which of the following is NOT a component of the IS Strategic Plan?

Employee performance evaluations Signup and view all the answers

How does the IS Strategic Plan contribute to project management?

By efficiently allocating resources among competing projects Signup and view all the answers

What does an effective IS Strategic Plan require concerning the organization's strategy?

It must align with the organization’s overall strategic plan Signup and view all the answers

What is a likely consequence of poor IT planning?

Increased security vulnerabilities Signup and view all the answers

Which factor is essential for the IT architecture in an IS Strategic Plan?

Seamless networking of users, applications, and databases Signup and view all the answers

What is a primary purpose of systems development?

To produce an information system addressing an organizational problem or opportunity Signup and view all the answers

Which of the following is NOT a challenge of systems development?

Implementing new marketing strategies Signup and view all the answers

What can be a consequence of an unsuccessful information system (IS)?

Damage to brand reputation Signup and view all the answers

Which statement about the Systems Development Life Cycle (SDLC) is correct?

SDLC is a foundational process for multiple systems development methods. Signup and view all the answers

Why is it important for a new information system to evolve with an organization?

To align with the organization's evolving business needs Signup and view all the answers

What percentage of computer downtime can be attributed to defective software?

45% Signup and view all the answers

What should new information systems primarily aim to achieve?

Improve organizational productivity Signup and view all the answers

Which of the following best describes a potential opportunity that systems development can address?

A chance for growth through e-commerce Signup and view all the answers

What is the main focus of the Joint Application Design (JAD)?

Analysis and design phases of SDLC Signup and view all the answers

Which of the following is a key principle of Agile development?

Early and continuous delivery of system components Signup and view all the answers

In Agile development, what is the role of the scrum master?

Maintains the processes and facilitates the team Signup and view all the answers

How does Agile development approach project management?

Using a series of smaller, manageable projects Signup and view all the answers

What does the Agile Manifesto aim to address?

Limitations of the Waterfall model Signup and view all the answers

What is the ideal size of the cross-functional team in a scrum approach?

About seven members Signup and view all the answers

Which of the following statements is true about the iterative approach in Agile development?

Work is done in cycles with revisions based on user input Signup and view all the answers

Which phase of the SDLC does the Agile development method specifically focus on?

Analysis and design phases Signup and view all the answers

Which Agile principle emphasizes the importance of face-to-face communication?

Daily cooperation between business people and developers Signup and view all the answers

What is a primary measure of progress in Agile processes?

Working software Signup and view all the answers

What is a significant advantage of end-user development?

Faster development Signup and view all the answers

Which of the following is considered a disadvantage of end-user development?

Lack of development expertise Signup and view all the answers

In Agile methodologies, how are projects built?

Around motivated individuals Signup and view all the answers

According to Agile values, which is prioritized over processes and tools?

Individuals and interactions Signup and view all the answers

Which statement aligns with the Agile principle of simplicity?

Minimizing unnecessary work enhances productivity. Signup and view all the answers

What is a characteristic of the Systems Development Lifecycle (SDLC)?

Follows a sequential phase structure Signup and view all the answers

What is a key feature of Joint Application Design (JAD)?

Active user involvement in design Signup and view all the answers

What does prototyping in system development focus on?

Building a model and refining it iteratively Signup and view all the answers

Study Notes

Management Information Systems - Week 11

Acquiring Information Systems (Chapter 13) is the focus of the week
Course materials may not be copied, shared, or uploaded to external websites without permission. This is considered academic fraud and copyright infringement
Agenda:
- IT Planning
- Strategies for Acquiring IT Applications
- Traditional Systems Development Life Cycle (SDLC)
- Alternative Methods and Tools for Systems Development

Overall Planning Process

A flowchart shows the steps from organizational mission to IS Development projects
Key phases include: Organization mission, Organization strategic plan, Business assessment, IS strategic plan, Current information technology architecture, New information technology architecture, IS operational plan, IS development projects

IS Strategic Plan

Definition: A set of long-term goals outlining IT infrastructure and initiatives to achieve organizational goals
Three objectives:
- Alignment with the organization's strategic plan
- Seamless network for users, applications, and databases
- Efficient allocation of IS development resources for projects

IS Operational Plan

Definition: A clear set of projects the IS department and functional area managers execute to support the IT strategic plan
Key elements:
- Mission statement
- Information needs (IS environment)
- IS function objectives
- IS function constraints (tech, financial, human resources)
- Application portfolio (present and expected applications)
- Resource allocation and project management (who, what, how, when)

Considerations in Executing IS Strategic and Operational Plans

Assessing Costs:
- Fixed costs
- Variable costs for maintenance, debugging, and system improvements
Assessing Benefits:
- Tangible benefits
- Intangible benefits
Conducting Cost-Benefit Analysis:
- Net present value (NPV)
- Return on investment (ROI)
- Break-even analysis
- Business case approach

Strategies for Acquiring IS

Purchase (Buy):
- Purchasing pre-written applications (e.g., HR ERP modules from SAP)
- Cost-effective and time-saving compared to developing in-house
- Organization must ensure the software meets current and future needs
Advantages of Purchase: Many choices, ability to test before purchasing, saves time, familiar product, eliminates the need for specialized personnel
Disadvantages of Purchase: May not meet all organizational needs, difficult to modify, integration challenges, potential vendor discontinuation, limited understanding of underlying technology
Customize a Prewritten Application:
- Purchase a commercial package and customize it
- Allows the software to fit specific organizational processes (no need for process change)
- Customization can potentially degrade software performance, and every new version may need customization
Use SaaS (Software as a Service):
- Cloud-based application offered by vendors (e.g., Salesforce.com)
- The vendor hosts the applications, provided through the internet
- Cost-effective, time saving, no need for local IT infrastructure

Strategies for Acquiring IS - Continued

Outsourcing:
- Hiring third-party companies (e.g., IBM) to handle software development, operation, and maintenance
- Offshoring (outsourcing to a different country - e.g., India)
- Risk: Communication and potential challenges to data security
Custom Development (Build):
- Organizations custom build the application in-house or with a third party
- Produces better fit with organizational processes, especially if it represents a competitive advantage
- Often time-consuming and costly

Fundamental Decisions in Acquiring IT Applications

Deciding on Development Requirements: Amount of computer coding, payment methods
Deciding on Implementation of Application: Where the application runs and where it originates

Systems Development

Systems development: Activities involved in creating IS to address organizational problems (e.g., decreased customer satisfaction or potential for growth) or take advantage of opportunities
Examples: CRM to address customer loss problems or e-commerce to address business growth
Challenges: Time, cost, organizational changes, determining how to effectively use new IS, establishing IT requirements, new IS having to adapt along with the organization & its evolving business

Systems Development - Continued

Consequences of IS successes and failures: Significantly impact a company's performance
- Decreased or increased revenue
- Financial liabilities
- Decreased or increased productivity

Systems Development Life Cycle (SDLC)

The overall process in developing IS; fundamental elements for several methods (e.g., waterfall, agile)
Phased approach:
- Investigation
- Analysis
- Design
- Programming
- Testing
- Implementation
- Operation & Maintenance

SDLC: Investigation

Feasibility Study: Helps organizations choose among three options:
- Do nothing
- Modify/Enhance existing system
- Develop a new system
Assess feasibility of technical, economic, and behavioral aspects

SDLC: Analysis

System Analysis: Examining the business problem, gathering information about existing systems, and defining new/improved system requirements
Deliverable: User requirements for the system

SDLC: Design

System Design: Describing how the system resolves the business problem with detailed technical specifications
Deliverable: Technical specifications for outputs, inputs, processing, interfaces, hardware, software, databases, personnel, procedures, and blueprints of integration

SDLC: Programming

Programming: Transform detailed design documents into actual system code via computer code
Primary Activities: IT specialists develop IT infrastructure and the database & programs

SDLC: Testing

Testing: Bringing all project pieces into a special testing environment to test for errors (bugs) and compatibility (interoperability) to confirm it meets the requirements of analysis phase

SDLC: Implementation

Placing the system into production (making it available for use) to allow users to begin business operations
Primary Activities: Detailed user documentation, user training, conversion strategy (different strategies, such as parallel, direct, phased, and pilot)

SDLC: Operation & Maintenance

Maintaining, correcting, adding features, or upgrading the system to meet business goals
Types of Maintenance: adaptive, corrective, perfective, and preventive

Comparison of User and Developer Involvement over the SDLC

A graphical representation depicting the level of involvement of users and developers throughout the SDLC (in relation to time & stages)

Alternative Methods for Systems Development

Waterfall: Sequential & activity-based, each phase is performed sequentially without revisiting. Issues: Problems with this methodology; assumes users can specify all requirements in advance, assumes requirements do not change over time. Success rate is only about 10%
Joint Application Design (JAD): Focuses on the analysis & design phases by involving group meetings of systems analysts and users. Goal: Define & agree on systems requirements
Agile Development: Focuses on early delivery of system components. Iterative Approach. Divide project into smaller projects and achieve rapid feedback and acceptance.
End-User Development: Done by individuals who use the system, ranging from worksheet templates to complex systems. Strengths: Meeting user requirements, increased sense of ownership, potentially faster development; Weaknesses: Lack of development expertise, inconsistent with organizational goals; & lack of documentation.

Tools for Systems Development

Design Thinking: Empathy, Define, Ideate, Prototype, Test
Prototyping: Initial list of user requirements, build a model of the system, refine it based on feedback
Integrated Computer-Assisted Software Engineering (CASE) Tools: Automate many SDLC tasks
Component-Based Development: Using reusable components (e.g., shopping cart, authentication) to build applications

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Description

Test your knowledge on the benefits and risks of acquiring information systems, including custom development and offshoring. This quiz covers key concepts in the system development life cycle (SDLC) and strategic planning for information systems. Assess your understanding of various maintenance types and methodologies used in IT applications.