Chapter 05 Software Acqui

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Systems Analysis & Design

Sixth Edition

Chapter 5


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Chapter Objectives

Describe software trends, including the

concept of software as a service

Explain software acquisition

alternatives, including traditionalversus Web-based software

development strategies

Describe software outsourcing options,

including offshore outsourcing and therole of service providers


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Chapter Objectives

Explain advantages and disadvantages

of developing software in-house versus

other alternatives

Explain cost-benefit analysis andfinancial analysis tools

Explain the differences between a

request for proposal (RFP) and a

request for quotation (RFQ)


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Chapter Objectives

Describe the contents of the system

requirements document

Explain the transition from systems

analysis to systems design, and thedifference between logical and physical

design

Explain the transition to systems design

and the importance of prototyping

Discuss guidelines for systems design


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Introduction

Chapter 5 describes the remaining

activities in the systems analysis phase

The chapter also describes the transition

to systems design, prototyping, andsystems design guidelines


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Development Strategies Overview

Selecting the best development path is

an important decision that requires

companies to consider three key topics

The impact of the Internet Software outsourcing options

In-house software development alternatives


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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

market-place for software, and how Web-

based development compares totraditional methods


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Software as a Service

The Software and Information Industry

Association (SIIA) is an industry group that

focuses on the digital economy

SIIA believes that the concept ofsoftware as a

service is redefining the way that companies

develop and deploy their information systems


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The Changing Software Marketplace

In the traditional model, software vendors

develop and sell application packages to

customers

In addition to traditional vendors, the

marketplace now includes many forms of

outsourcing, including application service

providers and firms that offer Internet business

services


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The Impact of the Internet on Systems

Development

Developers will focus on Web-based application

development, where the Web becomes an

integral part of the application rather than just a

communication channel

IBMs WebSphere

Microsofts .NET


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The Impact of the Internet on Systems

Development

Traditional development

Systems design is influenced by compatibility issues

Systems are designed to run on local and wide-area

company networks

Web-based features are treated as enhancements

rather than core elements of the design


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The Impact of the Internet on SystemsDevelopment Web-based development

Systems are developed and delivered in an

Internet-based framework such as .NET orWebSphere

Internet-based development treats the Web as theplatform, rather than just a communication channel

Web-based software usually requires additionallayers, called middleware


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Outsourcing

Can refer to relatively minor

programming tasks, the rental of

software from a service provider, the

outsourcing of a basic businessprocess (often called business process

outsourcing, or BPO), or the handling of

a companys entire IT function


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Outsourcing

The Growth of Outsourcing

Traditionally, firms outsourced IT tasks as a way

of controlling costs and dealing with rapid

technological change

Outsourcing has become part of an overall IT

strategy for many organizations

On Demand


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Outsourcing

The Growth of Outsourcing

A firm that offers outsourcing solutions is called

a service provider

Application service providers (ASP)

Internet business services (IBS)

Also called managed hosting


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Outsourcing

Outsourcing Fees A fixed fee model uses a set fee based on a

specified level of service and user support

A subscription model has a variable fee based

on the number of users or workstations thathave access to the application

A usage model or transaction model chargesa variable fee based on the volume oftransactions or operations performed by theapplication


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Outsourcing

Outsourcing Issues and Concerns

Mission-critical IT systems should be out-

sourced only if the result is a cost-attractive,

reliable, business solution that fits the

companys long-term business strategy

Outsourcing also can affect day-to-day company

operations and can raise some concerns

Outsourcing can be especially attractive to a

company whose volume fluctuates widely, suchas a defense contractor


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Outsourcing

Offshore Outsourcing

Offshore outsourcing global outsourcing

Many firms are sending IT work overseas at an

increasing rate

Gartner, a leading IT research and consulting

firm, predicts that by 2005 one in 10 IT jobs at

U.S. IT companies and one in 20 at non-IT

companies will move offshore


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In-House Software Development

Options

A company can choose to develop its

own systems, or purchase, possibly

customize, and implement a software

package The most important consideration is

total cost of ownership (TCO)

Companies also develop user

applications designed aroundcommercial software packages


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Options

Make or Buy Decision

The choice between developing versus

purchasing software often is called a make or

buy, or build or buy decision

Companies that develop software for sale are

called software vendors

Value-added reseller (VAR)

Horizontal application

Vertical application


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Options

Developing Software In-House

Satisfy unique business requirements

Minimize changes in business procedures and

policies

Meet constraints of existing systems

Meet constraints of existing technology

Develop internal resources and capabilities


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Options

Purchasing a Software Package

Lower costs

Requires less time to implement

Proven reliability and performance benchmarks Requires less technical development staff

Future upgrades provided by the vendor

Input from other companies


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Options

Customizing a Software Package1. 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 yourneeds by paying for the changes

3. You can purchase the package and makeyour own modifications, if this is permissibleunder the terms of the software license


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Options

Creating User Applications

A user application utilizes standard business

software

User interface

Help desk or information center (IC)

Screen generators

Report generators

Read-only properties


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Role of the Systems Analyst

When selecting hardware and software,systems analysts often work as an

evaluation and selection team

The primary objective of the evaluationand selection team is to eliminate

system alternatives that will not work,

rank the system alternatives that will

work, and present the viablealternatives to management for a final

decision


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Analyzing Cost and Benefits

Financial Analysis Tools

Payback Analysis

Return on investment (ROI)

Net present value (NPV)


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Analyzing Cost and Benefits

Cost-Benefit Analysis Checklist List each development strategy being

considered

Identify all costs and benefits for each

alternative. Be sure to indicate when costs willbe incurred and benefits realized

Consider future growth and the need forscalability

Include support costs for hardware and software

Apply the financial analysis tools to eachalternative

Study the results and prepare a report tomanagement


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The Software Acquisition Process

Step 1: Evaluate the Information SystemRequirements

Prepare a request for proposal or quotation

Request for proposal (RFP)

Evaluation model

Request for quotation (RFQ)


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Step 2: Identify Potential Vendors orOutsourcing Options

The Internet is a primary marketplace

Another approach is to work with a consultingfirm

Another resource is the Internet bulletin board

system that contains thousands of forums, called

newsgroups


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Step 3: Evaluate the Alternatives

Existing users

Application testing

Benchmarking - benchmark Match each package against the RFP features

and rank the choices


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Step 4: Perform Cost-Benefit Analysis

Identify and calculate TCO for each option you

are considering

When you purchase software, what you are

buying is a software license

If you purchase a software package, consider a

supplemental maintenance agreement


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Step 5: Prepare a Recommendation You should prepare a recommendation that

evaluates and describes the alternatives,

together with the costs, benefits, advantages,

and disadvantages of each option

At this point, you may be required to submit a

formal system requirements document and

deliver a presentation


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Step 6: Implement the Solution Implementation tasks will depend on the solution

selected

Before the new software becomes operational,

you must complete all implementation steps,

including loading, configuring, and testing the

software; training users; and converting data

files to the new systems format


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Completion of Systems Analysis

Tasks

System Requirements Document The system requirements document, or

software requirements specification,contains the requirements for the new

system, describes the alternatives that wereconsidered, and makes a specificrecommendation to management

Like a contract

Format and organize it so it is easy to read

and use


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Tasks

Presentation to Management Begin your presentation with a brief overview of

the purpose and primary objectives of the

system project, the objectives of this

presentation, and what decisions need to made

Summarize the primary viable alternatives. For

each alternative, describe the costs,

advantages, and disadvantages


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Tasks

Presentation to Management Explain why the evaluation and selection team

chose the recommended alternative

Allow time for discussion and for questions and

answers

Obtain a final decision from management or

agree on a timetable for the next step in the

process


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Tasks

Presentation to Management Based on their decision, your next task will be

one of the following

1. Implement an outsourcing alternative

2. Develop an in-house system

3. Purchase or customize a software package

4. Perform additional systems analysis work

5. Stop all further work


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The Transition to Systems Design

If management decides to develop thesystem in-house, then the transition to

the systems design phase begins

Preparing for Systems Design Tasks It is essential to have an accurate and

understandable system requirements document


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The Transition to Systems Design

The Relationship between Logical andPhysical Design

The logical design defines the functions and

features of the system and the relationships

among its components

The physical design of an information system is

a plan for the actual implementation of the

system


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Systems Design Guidelines

The systems analyst must understandthe logical design of the system before

beginning the physical design of any one

component

Data design

User interface

Systems design specification


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Systems Design Objectives The goal of systems design is to build a system

that is effective, reliable, and maintainable


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System Design Objectives User Considerations

Data Considerations

Data should be entered into the system where and when

it occurs because delays cause data errors

Data should be verified when entered to catch errors

immediately

Automated methods of data entry should be used

whenever possible

Access for data entry should be controlled and all entries

or changes to critical data values should be reported

audit trails


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System Design Objectives Data Considerations

Data should be entered into a system only once

Data duplication should be avoided

Architecture considerations

Use a modular design

Design modules that perform a single function are

easier to understand, implement, and maintain


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Design Trade-Offs Design goals often conflict with each other

Most design trade-off decisions that you will face

come down to the basic conflict of quality versus

cost

Avoid decisions that achieve short-term savings

but might mean higher costs later


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Prototyping

Prototyping produces an early, rapidlyconstructed working version of the

proposed information system, called a

prototype

Prototyping Methods

System prototyping

Design prototyping

Throwaway prototyping


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Prototyping

Prototyping Methods Prototyping offers many benefits

Users and systems developers can avoidmisunderstandings

Managers can evaluate a working model moreeffectively than a paper specification

Consider potential problems The rapid pace of development can create quality

problems

In very complex systems, the prototype becomesunwieldy and difficult to manage


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Prototyping

Prototyping Tools Systems analysts can use powerful tools to

develop prototypes

CASE tools

Application generators

Report generators

Screen generators

Fourth-generation language (4GL)

Fourth-generation environment


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Prototyping

Limitations of Prototypes A prototype is a functioning system, but it is less

efficient than a fully developed system

Systems developers can upgrade the prototype

into the final information system by adding thenecessary capability

Otherwise, the prototype is discarded

Other Modeling Tools

Systems flowchart

American National Standards Institute (ANSI)


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Chapter Summary

This chapter describes systemdevelopment strategies, the preparationand presentation of the systemrequirements document, and the

transition to the systems design phase ofthe SDLC

An important trend that views software asa service, rather than a product, has

created new software acquisition options Systems analysts must consider Web-

based development environments


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Chapter Summary

The systems analysts role in thesoftware development process dependson the specific development strategy

The most important factor in choosing a

development strategy is total cost ofownership (TCO)

The process of acquiring softwareinvolves a series of steps

Chapter 5 complete

Chapter 05 Software Acqui

Documents

Transcript of Chapter 05 Software Acqui