Chapter 20

Introduction to Systems Development and Systems Analysis

20-1
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 Learning Objectives
 Explain the five phases of the systems development life
cycle.

 Discuss the people involved in systems development and

the roles they play.

 Explain the importance of systems development planning

and describe planning techniques.

 Discuss the various types of feasibility analysis and calculate

economic feasibility.

 Explain why system changes trigger behavioral reactions,

What form this resistance to change takes, and how to avoid or
minimize the resulting problems.

 Discuss the key issues and steps in systems analysis.

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 Why Update Systems?

 User or business changes

 Technology changes

 To improve business process

 Create competitive advantage

 Increase productivity gains

 Integrate multiple systems

 Aging systems need replacement

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 Software Development Problems

 Most software development projects deliver less, cost

more, and take longer than expected.
 Standish Group found that:
 70 percent of software development projects were late
 54 percent were over budget
 66 percent were unsuccessful
 30 percent were canceled before completion
 American Management Systems found that:
 75 percent of all large systems are not used
 Not used as intended, or
 Generate meaningless reports or inaccurate data

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 Systems Development Life Cycle
(SDLC)

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 SDLC Steps
 System Analysis
 Information about system needs, costs, and so on are gathered.

 Conceptual Design
 Gather system/user requirements.

 Physical Design
 Concepts are translated into detailed specifications.

 Implementation and Conversion

 New hardware and software are installed and tested.
 Employees are hired and trained or existing employees relocated.
 Processing procedures are tested and modified.
 Standards and controls for the new system are established and system
documentation completed.

 Operation and Maintenance

 New system is periodically reviewed.
 Modifications are made as problems arise or as new needs become evident.

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 Systems Analysis Activities

Initial Systems Feasibility Information Systems

Investigation Survey Study needs and Analysis
•What’s the •Gain •Determine System Report
Problem Understanding of Project Viability Requirements •Summarize and
•What’s the Company Document
•What do Users
Scope •Preliminary Need Activities
Assessment of
Needs & •Document
System
Changes
Required Requirements
•Develop Working
Relationships
•Collect Data

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 People Interacting in SDLC

 Management

 Accountants

 Users

 Information systems steering committee

 Project development team

 Systems analysts and programmers

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 Planning SDLC

 Project Development Plan

 Cost/benefit analysis
 Developmental and operational requirements (people,
hardware, software, and financial)
 Schedule of the activities required to develop and operate
the new application

 Master Plan
 What the system will consist of
 How it will be developed
 Who will develop it
 How needed resources will be acquired
 Where the AIS is headed

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 Planning Technique—PERT Chart

 Program Evaluation and Review Technique (PERT)

 Network of arrows and nodes representing project activities
that require an expenditure of time and resources and the
completion and initiation of activities
 Completion time estimates made
 Critical path—the path requiring the greatest amount of
time is determined

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 Planning Technique—GANTT Chart

 A bar chart with project activities on the left-hand side

and units of time across the top

 Graphically shows the entire schedule for a large,

complex project

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 Feasibility Analysis
 Does it make sense to proceed with new system?

 Economic:
 Will system benefits justify the time, money, and resources required to implement it?

 Technical:
 Can the system be developed and implemented using existing technology?

 Legal:
 Does the system comply with all applicable federal and state laws, administrative
agency regulations, and contractual obligations?

 Scheduling
 Can the system be developed and implemented in the time allotted?

 Operational
 Does the organization have access to people who can design, implement, and
operate the proposed system? Will people use the system?

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 Capital Budgeting: Economic
Feasibility
Cost-Benefit Analysis
 Benefits and costs are estimated
and compared to determine
whether the system is cost
beneficial.
 Benefits and costs that are not
easily quantifiable are estimated
and included.
 If they cannot be accurately
estimated, they are listed, and
their likelihood and expected
impact on the organization
evaluated.
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Techniques
 Payback Period
 Number of years required for the
net savings to equal the initial
cost of the investment.
 Net Present Value (NPV)
 Future benefits are discounted
back to the present.
 Initial cost is subtracted.
 Positive NPV = economically
feasible.
 Internal Rate of Return (IRR)
 The effective interest rate that
results in an NPV of zero.
 A project’s IRR is compared with a
minimum acceptable rate to
determine acceptance or
rejection.
20-13
 System Failure Due to Change

 The best system will fail without the support of the people
it serves.

 Why people resist change:

 Fear
 Lack of top management support
 Lack of communication
 Disruptive nature of change
 Methods of instituting change
 Biases and emotions
 Personal characteristics and background

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 Types of Resistance

 Aggression
 Behavior that destroys, cripples, or weakens system
effectiveness, such as increased error rates, disruptions, or
deliberate sabotage

 Projection
 Blaming the new system for everything that goes wrong

 Avoidance
 Ignoring a new AIS in the hope that the problem (the
system) will eventually go away

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 Preventing Resistance
 Obtain management support

 Meet user needs

 Involve users

 Stress new opportunities

 Avoid being too emotional

 Provide user training

 Reexamine performance evaluation to make sure they are aligned

with new system

 Keep communication lines open

 Control users expectations

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