AIS17

©2003 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, Romney/Steinbart

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Accounting Information Systems9th Edition

Marshall B. Romney

Paul John Steinbart


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AIS Development Strategies

Chapter 17


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Learning Objectives

1. Describe how organizations purchase application software, vendor services, and hardware.

2. Explain how information system departments develop custom software.

3. Explain how end-users develop, use, and control computer-based information systems.


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Learning Objectives

4. Explain why organizations outsource their information systems, and evaluate the benefits and risks of this strategy.

5. Explain the principles and challenges of business process reengineering.


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Learning Objectives

6. Describe how prototypes are used to develop an AIS, and discuss the advantages and disadvantages of doing so.

7. Explain what computer-aided software engineering is and how it is used in systems development.


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Introduction

Ann Christy was elated that the new system Shoppers Mart (SM) needed was approved.

She needed answers to the following questions: Was the software she needed available for

her to purchase? If so, how should she approach the process of buying hardware and software and selecting a vendor?


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Introduction

How do companies go about developing software in-house, and is this the best approach for SM?

How extensively should the system make use of end-user-developed software?

If the company decided to develop the system in-house, should it try and speed up the development process by using prototyping or computer-assisted software engineering?


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Introduction

Should SM just make the needed improvements to its existing system, or should it consider reengineering its business processes and then develop a system to support the new processes?

Was outsourcing the information system a viable alternative to obtaining a new system? Did the benefits outweigh its risks?


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Introduction

This chapter discusses three ways to obtain a new information system: purchasing prewritten software, developing software in-house, and hiring an outside company (outsourcing).

It also presents ways of speeding up or improving the development process – business process reengineering, prototyping and computer-aided software engineering (CASE) tools.


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Learning Objective 1

Describe how organizations purchase application software, vendor services, and hardware.


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Purchase Software

Canned software is written by software development companies and is sold on the open market to a broad range of users with similar requirements.

Turnkey systems are a combination of software and hardware sold as a package. The vendor installs the entire system and user needs only to “turn the key”.


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Purchase Software, continued

The Internet has given companies a new way to acquire software:

Application service providers (ASPs) host Web-based software on their computers and deliver the software to their clients over the Internet.


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Purchasing Software and The SDLC Companies that buy rather than

develop AIS software still go through the systems development life cycle (SDLC).

1. Systems analysis2. Conceptual design3. Physical design4. Implementation and conversion5. Operation and maintenance


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The Systems Acquisition Process

Will packagemeet needs?

Developsoftwareinternally

Send RFP forhardware,

if necessary

Evaluateproposal

No

Yes

Investigatesoftwarepackages

Can packagebe modified?

Send RFP forsoftware and

hardware

No

Yes

Select bestcombination

Yes


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Explain how information system departments develop custom software.


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Development by In-House IS Department

Most often, organizations develop their own custom software, because canned software that fit their specific needs is not available.

Developing custom software is difficult and error-prone.

It also consumes a great deal of time and resources.


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Custom Software Development by an Outside Company

When contracting with an outside organization, a company should maintain control over the development process. Some guidelines:

• Carefully select a developer

• Sign a contract

• Plan and monitor each step

• Maintain effective communication

• Control all costs


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Explain how end users develop, use, and control computer-based information systems.


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End-User-Developed Software End-user computing (EUC) is the hands-on

development, use, and control of computer-based information systems by users.

With the advent of inexpensive PCs and powerful, inexpensive software, users began developing their own systems to create and store data, access and download company data, and share data and computer resources in networks.


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End-User-Developed Software Examples of end user development uses:

• Retrieving information from company databases to produce simple reports or to answer one-time queries

• Performing “what if” sensitivity or statistical analyses

• Developing applications using prewritten software (spreadsheet or database system)

• Preparing schedules and lists, such as depreciation schedules, accounts receivable aging, and loan amortizations


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Benefits of End-User-Developed Software

Benefits of End-User Computing

User creation, control, and implementation Systems that meet user needs Timeliness

Freeing up IS resources Versatility and ease of use


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Risks of End-User-Developed Software

Risks of End-User Computing Logic and development errors

Inadequately tested applications Inefficient systems

Poorly controlled and documented systems Systems incompatibility Duplication of systems

Increased costs


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Managing and Controlling End-User Computing

Organizations use several different approaches to mange and control end-user computing. For example, a help desk can encourage, support, coordinate and control end-user activities.


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Functions of a Help Desk

What are some duties of the help desk?– Providing hot-line assistance to help resolve

problems– Serving as a clearinghouse for information,

coordination, and assistance training end users, and providing corresponding technical maintenance and support

– Evaluating new end-user hardware and software products

– Assisting with application development– Developing and implementing standards– Controlling corporate data


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Explain why organizations outsource their information systems, and evaluate the benefits and risks of this strategy.


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Outsource the System

What is outsourcing?It is hiring an outside company to

handle all or part of an organization’s data processing activities.

In a mainframe outsourcing agreement, the outsourcers buy their client’s computers and hire all or most of the client’s employees.


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In a client/server or PC outsourcing agreement, an organization outsources a particular service, a segment of its business, a particular function, or PC support.


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Benefits of OutsourcingA business and information solution

Asset utilization

Access to greater expertise and more advanced technology

Lower costs Improved development time

Elimination of peaks and valleys usage Facilitation of downsizing


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Risks of Outsourcing Inflexibility

Loss of control of system and/or data Reduced competitive advantage

Locked-in system Unfulfilled goals

Possibility of poor service


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Explain the principles and challenges of business process reengineering.


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Business Processes Reengineering What is business process reengineering

(BPR)? It is the thorough analysis and complete

redesign of business process and information systems to achieve performance improvements.

It is a process that challenges traditional organizational values and cultures associated with underperformance.


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Business Processes Reengineering BPR reduces a company to its

essential business processes and focuses on why they are done rather than on the details of how they are done.

It completely reshapes organizational work practices and information flows to take advantage of technological advancements.


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Principles of Reengineering

What are the seven principles of business processing reengineering?

1. Organize around outcomes, not tasks.

2. Require those who use the output to perform the process.

3. Require those who produce information to process it.


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Principles of Reengineering

4. Centralize and disperse data.

5. Integrate parallel activities

6. Empower workers, use built-in controls, and flatten the organization chart.

7. Capture data once, at its source.


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Challenges Faced by Reengineering Efforts

What are some of the obstacles to reengineering efforts?

Tradition Resistance

Time requirements Risk

Lack of management support Skepticism

Retraining Controls


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Describe how prototypes are used to develop an AIS, and discuss the advantages and disadvantages of doing so.


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Prototyping

What is prototyping?– an approach to systems design in

which a simplified working model of a system is developed.

A prototype, or “first draft,” is quickly and inexpensively built and provided to users for testing.


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Prototyping

What four steps are involved in developing a prototype?1. Identify basic systems requirements.

2. Develop an initial prototype that meets the agreed-on requirements.

3. Users identify changes, developers make changes, and the system is turned over to the user.

4. Use the system approved by the users.


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Benefits of Prototyping

Advantages of Prototyping

Better definition of user needs Higher user involvement and satisfaction

Faster development time Fewer errors More opportunity for changes

Less costly


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Disadvantages of Prototyping

Disadvantages of Prototyping Significant user time Less efficient use of system resources

Incomplete systems development Inadequately tested and

documented systems Negative behavioral reactions

Unending development


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Explain what computer-aided software engineering is and how it is used in systems development.


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Computer-Aided Software Engineering (CASE) CASE is an integrated package of

computer-based tools that automate important aspects of the software development process.

CASE tools are used to plan, analyze, design, program, and maintain an information system.

They are also used to enhance the efforts of managers, users, and programmers in understanding information needs.


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Computer-Aided Software Engineering (CASE) CASE tools do not replace skilled

designers; instead they provide a host of self-integrated tools that give developers effective support for all SDLC phases.

CASE software typically has tools for strategic planning, project and system management, database design, screen and report layout, and automatic code generation.


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Computer-Aided Software Engineering (CASE)

Advantages of CASE Technology

Improved productivity Improved program quality

Cost savings Improved control procedures

Simplified documentation


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Computer-Aided Software Engineering (CASE)

Disadvantages of CASE Technology Incompatibility

CostUnmet expectations


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Case Conclusion

What did Ann Christy decide?– against outsourcing the AIS

What did she think about prototyping?– that it would not work well

What did she think about reengineering?– that the system did not need reengineering


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Case Conclusion

What were her options?– purchase a system or design

one in-house. No matter which approach she

chose, Ann wanted to facilitate as much end-user development as was practical and useful.


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End of Chapter 17

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