****For C. Owens Only****
Orignal Discussion Question
In Module 6, we examined strategies for developing, acquiring, and outsourcing the development of information systems. For your initial post, evaluate your organization to determine which strategy (in-house development, external acquisition, or outsourcing) would be most effective for obtaining a new enterprise system. Consider the organization's resources and refer to your textbook for information about why a given strategy might be used. Explain your choice of the best strategy.
In your response post, critique a recommended strategy of one of your group members. Based on the justification the group member provided, do you agree with their choice of strategy? Why or why not?
Additional Info:
Introduction
Before an information technology (or any other) recommendation is adopted, decision-makers must be convinced to implement the recommendation. Business cases are used to present the value of a proposal or project for an organization to decision-makers. When pitching an proposal or project it is not enough to just explain the idea, you must also provide a justification for why the proposal or project should be implemented. This lesson discusses types of arguments that can be made to justify a business case as well as tools for making the arguments.
Lecture
Begin by reading Chapter 9 pages 344 - 357. As you read, consider how you would use each type of argument and the various tools to justify the alternative solutions in your business case. Once you have completed the reading, review the lecture video below.
Making the Business Case
The strongest arguments, when making a business case, are based on facts. There are a variety of tools you can use to build your fact-based business case. We will now examine two of these tools and practice using them.
Cost-Benefit Analysis
In a cost-benefit analysis we compare the costs of a system to the benefits it provides over its life-time. We use the cost-benefit analysis in our evaluation of alternatives as one measure of value attributes. All things being equal (i.e., when alternatives are the same on all other value attributes), the alternative with the greatest net benefit (i.e., benefits minus costs) should be adopted.
To conduct a cost-benefit analysis, we create a spreadsheet listing the lifetime costs of the alternative followed by the lifetime benefits in the left-most column. The costs and benefits will may across alternatives. We add columns for each year of the alternatives expectant life. The lifespans of the alternatives may also vary. Include summary rows for total costs, total benefits, and net costs/benefits in the cost-benefit analysis spreadsheet.
Example
Below are two files. The first file is a spreadsheet for conducting a cost-benefit analysis. Use this table and the information outlined below to create a cost-benefit analysis. The second file attached below is the answer sheet. Once you have created your cost-benefit analysis, compare your results to the answer sheet.
Cost-Benefit Analysis Worksheet.xlsx
Cost-Benefit Analysis Answer Sheet.xlsx
You are proposing to implement a new computer system with a lifespan of 5 years. The new system will be installed on January 2, 2018. Place the following information into the Cost-Benefit Analysis Worksheet
· 10 computers at a cost of $2500 each
· 1 server at a cost of $3500
· 3 printers at a cost of $1500 each
· Network installation costs of $4500
· Annual software license at a cost of $16000
· Initial training will cost $15400
· After the first year, annual training costs will be $1550
· Server maintenance costs are $2500 annually after the first year
· Network maintenance costs are $4800 annually after the first year
· Electrical service fees are budgeted to be $4000 per year
· We expect to see an annual increase in revenue from the new system of $30,000
· We expect to see annual cost saving from error reduction of $10000
· We expect to see an annual reduction in costs of $20000
Weighted Multi-criteria Analysis
A weighted multi-criteria analysis is used to compare alternatives based on multiple criteria. The criteria used can be quantitative or qualitative. To conduct the analysis, identify the criteria you will use to choose between alternatives. For example, if you were purchasing a car you may compare options based on price, MPG, satisfaction with the car's options, annual maintenance cost, and safety. Once you have identified your criteria, you weight each criteria on a scale between 0 and 1 (NOTE: the sum of all the weights should equal 1). Next, you score each alternative on each criterion. Lastly, multiply the weight by the score for each criterion and sum the weighted scores across all criteria. The alternative with the highest score is the better option, all things being equal.
It is important to remember when scoring an alternative that the higher the score on a criterion, the better the alternative. This requires paying attention to how you score. For example, when scoring the criterion 'price' a higher score indicates a lower price and vice versa.
Example
Let's do an example. The file below contains the criteria, weights, and scores for four vendors of computers. Complete the table below the weights and scores to determine which alternative best meets the criteria. Once you have completed this example, check your answers using the Weighted Multi-Criteria Analysis Answer Sheet.
Weighted Multicriteria Analysis Worksheet.xlsx
Weighted Multicriteria Analysis Answer Sheet.xlsx
Conclusion
A business case is a document that explains the justification for selecting a project or alternative solution. Making the business case requires using both argumentation and data. Two tools for using data to make the business case are the cost-benefit analysis and the weighted multi-criteria analysis. You will use both of these tools when evaluating the alternatives in your business case project. You will also utilize a third tool, a risk analysis.
TOPIC # 2
Introduction
When seeking to implement an information system, administrators have two categories of options: acquire the system form an outside vendor or develop it internally. This lesson discusses systems development and introduces approaches for managing the systems development process. Begin by reading Chapter 9 pages 357 - 373, then watch the following lecture. I have also included a video (minutes 0:00 to 7:12) that provides an excellent description of the agile methodology scrum. Agile methodologies are very popular because the reduce the time and costs associated with developing information and communication technologies.
Conclusion
One option for obtaining an information system is to develop it in-house. In this lesson, we discussed several of the methods used in the development process. The systems development life-cycle and agile methodologies are very popular. As an administrator, it is important for you to have a basic understanding of these methodologies so that you can communicate with IT staff.
Topic 3
Introduction
Sometimes it is not feasible or desirable to develop systems in-house, these include when the organization has limited IS staff, the IS staff has limited skills, the IS staff is overworked, or there are problems with IS staff performance. When these situations occur, organizations look externally to acquire prepackaged systems (both proprietary and open source) or to outsource development. The final lesson of this module examines these two alternatives, what circumstances lead to their use, and steps for their execution.
External Acquisition
External acquisition is the purchasing of an existing system (both cloud and non-cloud systems) from an outside vendor. Examples of such systems include Microsoft Office, Salesforce (Links to an external site.) , and applications from Oracle (Links to an external site.) or SAP (Links to an external site.) . Take a few moments now to read about the steps in the external acquisition process in Chapter 9 on pages 373 - 380.
There are five steps to the external acquisition process. These steps are:
1. Systems Planning and Selection,
2. Systems Analysis,
3. Development of a Request for Proposal,
4. Proposal Evaluation, and
5. Vendor Selection.
Steps 1 and 2 are discussed in more detail in Lesson 2 of this module. We start be looking at the request for proposal, or RFP, step. An RFP is an invitation for vendors to submit bids for providing a system to meet a specified set of requirements. To see examples of RFPs for government, check out www.fbo.gov (Links to an external site.) . To see examples of RFPs from nonprofits, check out www.nonprofitsfirst.org (Links to an external site.) . Once RFPs have been received, they need to be evaluated. There are multiple ways of evaluating RFPs, including using cost-benefit analysis or multi-criteria analysis and then assigning each RFP a score based on the analysis results. In the end, the RFPs will need to be ranked and presented to decision-makers for vendor selection. Take a few moments and review the information on the RFP process found at vendorful.com (Links to an external site.) .
RFPs are not without there challenges. The following video discusses the challenges faced when seeking RFPs from vendors and why you should use an RFP. The video is the first part of a longer webinar. If you are interested, you can access the complete webinar by following the link at the end of the video and signing-up for free access.
Outsourcing Systems Development
Outsourcing is the hiring of an outside vendor to develop an IS system for the organization. This is similar to developing a system in-house, but rather than using your own IS staff, you hire an outside company. This option is useful when you need a tailor-made system and
· Cost and quality are a concern,
· There are problems with the performance of internal IS staff,
· There is supplier pressure,
· The organization is trying to simplify, downsize, and re-engineer processes,
· There are other financial considerations,
· The organization's culture is a problem, and
· There are internal irritants.
The most important task when outsourcing is to manage the relationship between the organization and the vendor. This includes writing and managing effective contracts. Take a few moments to read Drury's (2008) article, Understanding IT Procurement Contracts. (Links to an external site.)
Conclusion
Rather than developing information systems themselves, organizations may opt to acquire them through external vendors. Existing systems can be acquired from vendors or the development of a new system can be outsourced to an outside vendor. The choice to purchase a system or outsource development should be a strategic decision that takes into consideration the needs and resources of the organization. This choice is just as important to IS success as the choice of which system to implement.
Response to Classmates post below: (RESPONSE REQUIRED)
Due to the nature of my organization (law enforcement), a lot of the enterprise systems are already in place and utilized through networking throughout the law enforcement community. In the past, each law enforcement agency would have its own systems that contained databases and sensitive information on all types of events. This would include everything from people, vehicles, police reports, phone numbers, etc. As we evolved we began to encourage the development of enterprise systems to help contain all the data and make that data available to law enforcement agencies throughout the country. As departments outsourced for ready-made programs and software systems, we have learned over time that those programs fit “most” of our needs but not all. Most of the programming in place now limits search criteria or provides limited information that has to be checked through other databases and systems. In laments terms, I have to check similar information through multiple systems to get an accurate picture of data. So we continued to learn…
Currently, the agency is utilizing more modern enterprise systems with great success to communicate in an immediate and effective manner. That being said, if I were to continue to seek out an enterprise system to improve our agency, it would be through utilizing the same technology to create a system within the agency to aid in the solvability of crimes. As I stated in class, we currently use an application known as Telegram which aides us in sharing current “live” data to assist with cases; however, this is only shared with those on the application (invite only). The agency should adopt or implement new enterprise solutions through similar paths to allow interagency cooperation on case management. Again, due to the sensitive nature of our information, this would most likely be done through in-house monitoring with a software developer and utilizing external software that meets our security needs. Due to our lack of staffing within our own IT department and the fact that they are dealing with computers, programming, licensing, and everyday network and computer issues, they are overworked as it is. It is not practical to task them with the development of new programs; however, their knowledge in our systems, security protocols, and needs, is imperative in the development of a new program. Therefore, the selection of new systems software would be best completed by external acquisition as the ability to develop a proposal and provide systems information to suit our needs is imperative.
The ES software I would like to see is a “clearinghouse” type database where open cases being investigated are placed into the system with the ability to use search criteria. As information is obtained, officers can add notes or information to the case (not officially but as notes) and assist the investigation if applicable. Currently “flyers” are sent via email which often requests help to identify or locate someone. First, not everyone in the agency checks their email, never mind actually read it. Next, information is relayed only to the specific area where the crime occurred (in most cases) therefore if a person is stopped 20 miles away and fits a description of someone that is being looked for, the information may never be paired up.
I would like to see the system inclusive of all agency-related things such as, firearms reports, lab analysis, crime scene photos, police reports, etc.… This would eliminate hours of waiting for the lab to respond with an analysis or having the information forwarded to another lab person to get information that is already in the system. Enterprise systems software could encompass all of these aspects while maintaining an efficient established process.