Accounting Information System

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Accounting Information System
M.Com 710

• By
• Rizwan Waheed

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Evaluating Alternatives and Strategies

• This chapter includes the evaluation of
  alternative solutions , the preparation of the
  system requirement document and the presentation
  of the system requirements document to
  management, it also describes several systems
  development tools , techniques , and strategies ,
  including prototyping , computer-aided s/w
  engineering (CASE) tools , system flowcharts and
  state transition diagrams.

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Evaluating S/W Alternatives

• Make or buy decision
• The choice b/w developing s/w in-house and
  purchasing s/w is often called make or buy
  decision
• Software package
• A s/w package is purchased or leased from another
  company
• In-house software
• Is developed by the companys own IS (information
  System) department
• Companies that specialize in developing s/w for
  sale are called S/W publishers or S/W venders

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• Horizontal application
• A software package that can be used by many
  different types of organizations
• Vertical application
• A software package developed to handle
  information requirements for a specific type of
  business is called vertical application

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Why we develop S/W In-House

• Satisfy unique requirements
• Commercially available s/w do not meet their
  unique requirements
• Minimize changes in business procedures and
  policies
• Meet constraints of the existing system
• Any new s/w that is installed must work with
  existing system
• Meet constraints of existing technology
• The new s/w must be compatible with the existing
  h/w and operating environments

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• Develop internal resources and capabilities
• Many firms feel that in-house IS resources and
  capabilities provide a competitive advantage
  because they can respond quickly when business
  problems or opportunities arise

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Reasons for Buying a s/w Packages

• Lower Costs
• Require less time to implement
• When we purchase a package , it is already has
  been designed , tested, programmed and documented
  
• Proven reliability and benchmarks
• Implemented by other companies
• Require less technical development staff
• Less programmers and system analyst requires in
  IS department
• Future upgrades provided by the vendor

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Customizing s/w packages

• You must decide weather to build your own s/w or
  to acquire a s/w package that can be customized
  to meet your specifications.
• The three ways to customize a s/w packages are
• For some s/w packages , you might be able to
  purchase a basic package that can be customized
  to suit your needs, many s/w vendors offer basic
  packages that are available in standard versions
  , with add-on components that can be configured
  individually . (e.g HR system)

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1. You may be able to negotiate directly with the
   s/w vendor to make enhancements to meet your
   systems need by paying extra fee for the changes
2. Purchase the package and make your own
   modifications. This option might be attractive
   when the product come close to satisfying your
   requirements and the vendor will not make the
   requested changes.the disadvantage of this
   approach is that system analysts and programmers
   might be unfamiliar with the s/w and will need
   time to learn the package and make the
   modification correctly

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Other S/W Alterntives

• Outsourcing
• Is the use of outside companies to handle a
  portion of a companys workload on a temporary or
  long-term basis
• A contract personnel firm supplies technical help
  for specific periods of time at a set rate
• Another type of outsourcing involve the joint
  development of a customized vertical application
  package where a company works together wit an
  outside software vendor
• A major disadvantage of outsourcing is that it
  raises concerns about job security

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• End-user systems
• Are applications that can be operated and mnaged
  by end-users on their own.
• Enterprise computing
• Is an overall information management strategy
  that supports group, departmental and total
  company information needs . The key is the
  effective integration of information resources so
  that users have controlled access to the
  mainframe data they need to support local system.
  Many enterprise-computing systems are based on a
  design concept called client/server architecture