327Obtaining and successfully implementing a new information system application is far from trivial.
Whether an application is custom-built for a business organization, or purchased (or leased) from a
software vendor, both business and IS managers need to be accountable for achieving the business
benefits and managing the potential business risks from these application investments. These chap-
ters therefore describe key capabilities for every organization, large or small. For readers preparing to
be IS professionals or who have taken courses on systems analysis and design, you will have already
had some experience using a subset of these system development methodologies. For readers with
experience managing non-IT projects in organizational settings, you will likely be familiar with some of
the project management practices discussed here, but others will be specifically related to IT projects.
Chapter 8 presents some fundamental systems principles, including how systems thinking underlies
business process design and can be used for recognizing the technical andorganizational aspects of
introducing new systems in an organization. A life-cycle view of systems development is introduced, as
well as a variety of structured techniques, both procedural-oriented and object-oriented. The chapter also
highlights the importance of disciplined approaches to ensure operational reliability and data integrity, as
well as compliance with financial reporting requirements (such as Sarbanes-Oxley and Basel II).
Chapter 9 focuses on methodologies for developing custom software applications. Four
approaches are described and compared in some detail: a traditional systems development life cycle
(SDLC), a prototyping approach, a rapid application development (RAD) approach, and an “agile”
development approach. In addition to describing the key steps for developing and implementing cus-
tom software, we discuss project team roles, some project characteristics associated with successful
system delivery, and advantages and disadvantages of the custom development approach. The chap-
ter closes with a discussion of the benefits, risks, and methodological issues association with custom
software development by end users (user application development).
Chapter 10 begins with a discussion of the overall benefits associated with purchasing a software
application versus developing a customized application. We then detail the process steps for selecting,
preparing for, and implementing a software package. Next we discuss project team roles and some keys
to success. Then we describe in detail a special case: the benefits and key success factors associated
with enterprise system packages. The chapter ends with a discussion of newer software acquisition
options: open source software and software hosted by an application service provider (ASP).
Chapter 11 discusses practices for effectively managing IT projects. First we introduce some key
project management concepts—including portfolio management, the project management office, and
the major processes of an IT project: a) project initiation, b) project planning, c) project execution and
controlling, and d) project closing activities. Techniques are presented for addressing two IT project
management challenges that are dependent on business manager participation: managing the busi-
ness risks of an IT project and managing business change. The chapter closes with a discussion of
practices to address two special issues: managing large, complex IT projects (such as enterprise