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Chapter 13: Acquiring Information
Systems and Applications
IT Planning
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Organizational strategic plan: identifies the firm's overall mission, goals that follow
from that mission and steps to reach those goals (e
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craig school of business
statement)
IT Architecture: delineates the way an organization should utiliza its information
resources to accomplish its mission
IT Strategic Planning: a set of long-range goals that describe the IT infrastructure and
identify the major IT initiatives needed to achieve the organization’s goals
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Divide net income of a project by
average assets invested in the project
Break Even Analysis: determines the point at which the cumulative dollar value
of the benefits from a project equals the investment made in the project
Business Case Approach: writing a business case to justify funding one or
more applications or projects

Strategies for Acquiring IT Applications
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Fundamental decisions in acquiring IT applications
○ How much computer code does the company want to write?
○ How will the company pay for the application?
○ Where will the application run?
○ Where will the application originate?
Purchase a Prewritten Application: contain the standard features required by IT
applications
Customize a Prewritten Application: can be expensive and obsolete in a short time
Lease the Application: can save money, attractive to small/medium companies
Software-as-a-Service Vendors: eliminates need for customers to install and run the
application on their own computers
Application Service Provider (ASP): an agent or a vendor who assembles the software
needed by enterprise and then packages it with services such as development,
operations, and maintenance
Use Open Source Software: organizations obtain a license to implement an
open-source software product and either use it as is, customize it, or develop
applications
Outsourcing: acquiring IT applications from outside contractors or external
organizations
Continuous Development: adding new code to an application when it is finished
Employ Custom Development: custom-build an application, in-house or outsource it
○ CRM: Government Outreach

People Involved
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Systems Analyst: IS professionals who specialize in analyzing and designing
information systems
○ Technician > Analyst > Specialist
Programmers: modify existing computer programs or wite new ones to satisfy user
requirements
Technical Specialists: experts on a certain type of technology, such as databases or
telecommunication
Stakeholders: everyone who is affected by changes in a computer’s information
systems
Users: people who can access it at home

The Systems Development Life Cycle (SDLC)
1
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Analyzes which solution
works best
1) do nothing and continue to use existing system
2) modify existing system
3) develop new system
○ Technical feasibility: whether company can develop or acquire hardware &
software
○ Economic feasibility: if it can be afforded
○ Behavioral feasibility: addresses human issues
○ Go/No Go decision
2
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System Design: describes how the system will resolve the business problem
○ Deliverable: set of technical system specifications
■ User interface, system input/output
■ Hardware, software, databases, telecommunications, personnel, and
procedures
■ A blueprint of how these components are integrated
○ Frozen: when system specifications are approved by all participants
○ Scope Creep: adding functions after the project has been initiated
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Programming: translating the design specifications into computer code
○ Testing: assessing whether the computer code will produce the expected and
desired results
5
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Operations & Maintenance
○ Systems require several types of maintenance
■ Debugging: removing errors; continues throughout the life of the system
■ Updating: to accommodate changes in business conditions (regulations)
■ Adding: new functions
[FIGURE 13
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Group-based tool for collecting user requirements and creating design
Rapid Application Development (RAD): combines JAD, prototyping and integrated
computer assisted software engineering tool to rapidly produce a system
Agile Development: requires frequent meeting and communication
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_______ involves system developers writing a business case to justify funding one or
more specific applications or projects
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The business case approach
2
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a
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A _______ conversion involves shutting the old system off and turning the new system
on at a certain point in time
a
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_______ is a technical aspect of the IT architecture
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The applications software
5
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a
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If a company wants to write some computer code, it would choose to _______
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Customize a prewritten application
7
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a
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_______ is a method of delivering software in which a vendor hosts the applications and
provides them as a service to customers over a network, typically the internet
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SaaS
9
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a
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If a company doesn’t want to write any computer code, it would choose to _______
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Use a prewritten application



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