Development Strategies

CHAPTER 7

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INTRODUCTION
Chapter 7 describes the remaining activities
in the systems analysis phase, which include
evaluation
of
alternative
solutions,
preparation of the system requirements
document, and presentation of the system
requirements document to management. The
chapter also explains the transition to systems
design.

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1.The Impact of the Internet

The Internet has triggered enormous changes

in business methods and operations, and
software acquisition is no exception.
This section examines a trend that views
Software as a Service, the changing
marketplace for software, and how Web-based
development
compares
to
traditional
methods.

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1a.Software as a Service

Software as a Service (SaaS) is redefining the

way that companies develop and deploy their
information systems.
SaaS is a model of software delivery that cuts
across all market segments, including homes
and business of all sizes.

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The Web Host Industry Review shown in Figure 7-3 is an online

source of information about SaaS products, trends, and events. In
a published report, the Review quoted a Gartner, Inc. prediction
that worldwide SaaS revenue will reach $14.5 billion in 2012,
which is a 17.9 percent increase from 2011, and that by 2015,
SaaS revenue will grow to $22.1 billion.

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1b.Traditional vs. Web-Based

Systems Development
In an Internet-based system, the Web becomes an
integral part of the application, rather than just a
communication channel, and systems analysts
need new application development tools and
solutions to handle the new systems.
Two major Web-based development environments
are Microsofts .NET and IBMs WebSphere.
Microsoft regards .NET as a platform-independent
software environment.
IBM describes WebSphere as a set of products
specifically designed to support e-business
applications across multiple computing platforms.

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1b.Traditional vs. Web-Based Systems

Development
Traditional Development
In a traditional systems development environment:
Systems design is influenced by compatibility issues, including existing
hardware and software platforms and legacy system requirements.
Systems are designed to run on local and wide-area company networks.
Systems often utilize Internet links and resources, but Web-based features
are treated as enhancements rather than core elements of the design.
Development typically follows one of three main paths: in-house
development, purchase of a software package with possible modification,
or use of outside consultants.
Scalability can be affected by network limitations and constraints.
Many applications require substantial desktop computing power and
resources.
Security issues usually are less complex than with Web-based systems,
because the system operates on a private company network, rather than
the Internet.
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1b.Traditional vs. Web-Based Systems

Development
Web-Based Development
In a Web-based systems development environment:
Systems are developed and delivered in an Internet-based framework such
as .NET or WebSphere.
Internet-based development treats the Web as the platform, rather than just
a communication channel.
Web-based systems are easily scalable, and can run on multiple hardware
environments.
Large firms tend to deploy Web-based systems as enterprise-wide software
solutions for applications such as customer relationship management, order
processing, and materials management.
Web-based software treats the software application as a service that is less
dependent on desktop computing power and resources.
When companies acquire Web-based software as a service rather than a
product they purchase, they can limit in-house involvement to a minimum
and have the vendor install, configure, and maintain the system by paying
agreed-upon fees.
Web-based software usually requires additional layers, called middleware, to
communicate
with existing software
and
legacy
systems.
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1c. Evolving Trends: Web 2.0 and Cloud Computing

Web 2.0: A second generation of the World

Wide Web that enables people to collaborate,
interact, and share information much more
dynamically, based on continuously available
user applications rather than static HTML Web
pages.
Interactive experience is a hallmark of Web 2.

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1c. Evolving Trends: Web 2.0 and Cloud Computing

Cloud computing: An overall online software

and data environment in which applications
and services are accessed and used through
an Internet connection rather than on a local
computer; refers to the cloud symbol for the
Internet.

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2. Outsourcing

Outsourcing: The transfer of information

systems
development,
operation,
or
maintenance to an outside firm that provides
these services, for a fee, on a temporary or
long-term basis.
Includes minor programming tasks, renting
software from a service provider, outsourcing
a basic business process (often called
business process outsourcing, or BPO), or
handling a companys entire IT function.

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2a.Outsourcing Fees

Fixed fee model: A service model that charges a

set fee based on a specified level of service and user
support.
Subscription model: A service model that charges
a variable fee for an application based on the
number of users or workstations that have access to
the application.
Usage model/transaction model: A service model
that charges a variable fee for an application based
on the volume of transactions or operations
performed by the application. Also called a
transaction model.
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2b.Offshore Outsourcing

The practice of shifting IT development, support, and

operations to other countries.
In addition to exporting IT jobs, many large
multinational firms, including Microsoft and IBM, have
opened technical centers in India and other countries.
Some observers believe that India might gain as many
as 2 million IT jobs in the next decade.
The main reason for offshore outsourcing is the same as
domestic outsourcing: lower bottom-line costs. Offshore
outsourcing, however, involves some unique risks and
concerns. For example, workers, customers, and
shareholders in some companies have protested this
trend, and have raised public awareness of possible
economic impact.
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Make or Buy Decision

Software package: obtained from a vendor or

application service provider.
Software vendors: companies that develop software
for sale.
Value-added reseller (VAR): firm that enhances
commercial package by adding custom features and
configuring it for a particular industry.
Horizontal application: software package that can be
used by many different types of organizations. Eg:
accounting package.
Vertical application: software package developed to
handle information requirements for a specific type of
business. Eg: organization with special system
requirements include colleges, banks, and hospitals.
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3. In-House Software Development

Options

A company can choose to develop its own

systems, or purchase, possibly customize, and
implement a software package
Companies also develop user applications
designed
around
commercial
software
packages, such as Microsoft Office, to improve
user productivity and efficiency.

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Factors when comparing in-house development

with the purchase of a software package.
In-house development

Purchasing a software
package

1. Satisfy unique business

requirements

1. Lower costs.

2. Minimize changes in business

procedures and policies.

2.Requires less time to

implement.

3. Meet constraints of existing

systems.

3. Proven reliability and

performance benchmarks.

4. Meet constraints of existing

technology.

4. Requires less technical

develop- ment staff.

5. Develop internal resources and

capabilities.

5. Future upgrades provided by

the vendor.

6. Satisfy unique security

requirements.

6. Obtain input from other

companies.

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3a.Developing Software In-House

1.

2.

3.
4.

5.

Satisfy
Unique
Business
Requirements:
No
commercially available software package can meet their
unique business requirements
Minimize Changes in Business Procedures and
Policies: If the installation of a purchased package will
be too disruptive, the organization might decide to
develop its own software instead.
Meet Constraints of Existing Systems: To ensure
that the new system will interface with the old system
Meet Constraints of Existing Technology: The new
system must work with existing hardware and legacy
systems
Develop Internal Resources and Capabilities:
Companies can develop and train an IT staff that
understands the organizations business functions and
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3b. Purchasing a Software Package

1.

2.

3.

4.

5.

6.

Lower Costs: Even though the initial cost is less, purchased

software can involve expenses caused by business disruption,
changing business processes, and retraining employees.
Requires Less Time to Implement: When you purchase a
package, it already has been designed, programmed, tested,
and documented.
Proven Reliability and Performance Benchmarks: If the
product is popular, it almost certainly has been rated and
evaluated by independent reviewers.
Requires Less Technical Development Staff: Able to reduce
the number of programmers and systems analysts on the IT
staff
Future Upgrades Provided by the Vendor: Software vendors
regularly upgrade software packages by adding improvements
and enhancements to create a new version or release.
Input from Other Companies: Using a commercial software
package means that you can contact users in other companies
18 obtain their input and impressions
to

3c. Customizing a Software Package

If the standard version of a software product does

not satisfy a companys requirements, the firm can
consider adapting the package to meet its needs.
1. You can purchase a basic package that vendors
will customize to suit your needs.
2. You can negotiate directly with the software
vendor to make enhancements to meet your
needs by paying for the changes.
3. You can purchase the package and make your
own modifications, if this is permissible under the
terms of the software license.

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3d.Creating User Applications

Business requirements sometimes can be fulfilled by a user

application, rather than a formal information system or
commercial package.
User application: User applications utilize standard
business software, such as Microsoft Office that has been
configured in a specific manner to enhance user productivity.
In addition to configuring the software, the IT staff can
create a user interface, which includes screens, commands,
controls, and features that enable users to interact more
effectively with the application.
Some user applications have powerful screen generators
and report generators that allow users to design their own
data entry forms and reports
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4. The Software Acquisition Process

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Step 1: Evaluate the Information

System Requirements
Step 2: Identify Potential Vendors or
Outsourcing Options
Step 3: Evaluate the Alternatives
Step 4: Perform Cost-Benefit
Analysis
Step 5: Prepare a Recommendation
Step 6: Implement the Solution
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5. Completion of Systems Analysis Tasks

To complete the systems analysis phase, you
must prepare the system requirements
document
and
your
presentation
to
management.

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6. Transition to Systems Design

This section discusses preparation for systems

design and the relationship between logical
and physical design.

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6a. Preparing for Systems Design

A system requirements document provided

detailed specifications for output, input, data,
processes, and whatever else was needed.
Although agile methods do not require a
particular form of documentation, a successful
development team must understand and
record user requirements as they evolve
during the project.

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6b. Logical and Physical Design

Logical design: The logical design of an

information system defines the functions and
features of a system and the relationships
among its components.
Physical design: The physical design of an
information system is a plan for the actual
implementation of the system.

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Discussion topics
As more companies outsource systems
development, will there be less need for inhouse systems analysts? Why or why not?

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SANDY SHORES TIME SHARES

Sandy Shores Time Shares is one of the
largest time-sharing and rental brokers for
vacation cottages along the North Carolina
coast. After 10 successful years of matching
up owners and renters, Sandy Shores
decided
to
acquire
a
computerized
reservation and booking system. Tim Burns,
the owner of Sandy Shores, read an article
about software packages, and he asked you,
as an IT consultant, for your advice.
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SANDY SHORES TIME SHARES

1.

Would the new reservation and booking system be a

horizontal or a vertical application? Explain your answer.

2.

What software development and acquisition strategies

should Sandy Shores consider?

3.

Conduct an Internet search for online reservation systems,

software, and services that Sandy Shores might consider.
Describe your findings.

4.

As a system analyst, what would your role be in helping

Sandy Shores develop a new system? Would the
acquisition strategy affect your role? Why or why not?

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THE END

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