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8/10/2019 SPSD assignment
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Strategic Planning and Systems Development
Abstract
The purpose of this research paper is to attempt to find out existing facts and
concepts of aligning the development approaches with the application portfolio. The
research is aimed at identifying the current issues preventing the adaption of the
development approaches in the development such as the organization and management
issues in addition to the flaws and inappropriateness of several development models
within the context of development. This essential research to certain extends will
contribute to the nowadays IS/IT business entities that are facing with the side effects of
utilizing and developing the applications to support the business process and strategic
values. The main deliverables of this research paper are the identification of missing
areas of the existing and past research and the recommendation for the unidentified areas
to be enhanced and to be researched further in depth.
!
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1. Introduction
"ost of the today business organizations are influenced by the IS/IT. IS/IT can
help organizations to directly and indirectly maximize the profits and benefits through the
appropriate usages of the IS applications that are engineered to meet the organization
needs and business re#uirements. $s stated by Porter %&''!( the industry structure has
been shaped due to the impact of the factors which Porter calls five forces. "any of the
concrete examples given by Porter %&''!( showed both the success of organizations that
could see the benefits and )now how to exploit IS/IT in order to survive and gain
competitive advantages and failure of several organizations that neither have the
strategic vision brought by the IS/IT nor develop IS/IT in the right direction. The failure
in the later case is very common as the number of application portfolio including the
legacy system has increased from time to time which is obviously emphasized by *ard
and Peppard %&''&(.
$s stated in one of the I+" white papers ,$pplication Portfolio "anagement-
rom assessment to transformation it stated that 0Application development is often
based upon tactical considerations rather than on an enterprises strategic directions,
making it difficult to realize both short- and long-term goals, %I+" &''1(. "ost of the
organizations failed to see pros and cons of applying development models to application
development which adversely leads to the long period of development and failure during
the development before applications are delivered. To cope with this problem some of
researchers such as *ard and Peppard suggested that not only the IS/IT and business
strategy should be aligned but the development approach and application portfolio also.
2owever *ard and Peppard illustrated only the big picture of what and what to be
aligned with. They had little elaboration on what can prevent the alignment from being
adapted and which circumstances the existing alignment strategy should be re3considered
to deal with upcoming future especially when the business is scaled up or scaled down.
This is the general fact that the growing organization can be scaled down to certain size
inevitably due to financial issues.
&
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researchers and scholars will be used instead. $nyways the ob7ectives of this research or
its hypotheses must be clearly formed first before going through so that it will minimize
the ris) of misleading and loo)ing at the irrelevant resources.
The following are the research ob7ectives to be achieved.
!. 8larifying the actual definition of application portfolio and setting up the
baseline for investigation
&. Identifying the strength and wea)ness of common development approaches in
relation to the application portfolio development
1. inding the environmental issues preventing the alignment of development
approaches with application portfolio
9. 8ritically explore and evaluate the existing research on the alignment and
identify the missing areas
3. Research Analysis and Evaluation
3.1 Issues in defining application portfolio
$n understanding of what the application portfolio is and how it contributes to
both business processes and strategies should be clearly made at all since it can reduce
the ris) of developing the wrong applications that do not return any certain benefits to the
business but additional cost to the maintenance in the long run. There are several different
definitions of application portfolios in different contexts of business. +ecause of the word
,portfolio some of the definitions are restricted to only the collection of the IT
infrastructures hardware and software owned by a business entity. 2owever these
definitions do not answer the #uestion whether or not these collections of IT stuffs will
bring bac) :4I in what way they support the business and why great deal of investment
should be put in it. This section will loo) into various views of application portfolio and
identify its types and nature which is crucial in preparing the baseline for researching the
alignment of development approaches to the application portfolio.
9
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$pplication Portfolio "anagement %&'!'( defined application portfolio as 0It is a
collection of logic, data access, and user interface of course, but it is more than that. It
supports complex business processes, it is supported b large teams across geographies,
it operates on sensitive customer data, and it is sub!ect to a variet of regulator burden.6
%$pplication Portfolio "anagement &'!'( views the application portfolio as the general
system which emphasizes on the business process. It characterizes the nature of the
information system which needs supports and maintenance from team. 2owever this
definition is not sufficient enough to illustrate the clear picture of business application
portfolio. Today business involves more than 7ust the ongoing business process. Some
applications even offer values to not only business process but the customers who are
ones of the )ey figures in bringing bac) the return of investment to the organization. +y
ta)ing $pplication Portfolio "anagement %&'!'( definition into practice the collection of
legacy system and IT infrastructures such as computers and email system for routine
business functions without being integrated can be viewed as the application portfolio.
The number of IT facilities may not be the )ey in enhancing the business functions
because those facilities are not built in mind with the business process uni#ue to each
organization. or example giving a collection of computers with "icrosoft ;xcel to the
staffs to wor) with the inventory in contrary with giving a central database and process
oriented software pac)ages to the staffs wor)ing in the same function area can obviously
result in different performance and #uality. The later system will perform better than the
former one. +y defining the application portfolio limited to only the collection of IT
assets may #ualify only the definition of IT portfolio. "he I" Infrastructure portfolio
includes those common applications that everone uses on a da-to-da basis, primaril
for office automation. #xamples include$ e-mail, calendaring, and document
management, %5asa &''riffiths !
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now and in the future based on its industry impact. "cfarlans strategic grid categorized
information system into 9 #uadrants. $n application can be defined as a strategic
%application that are critical to future business success( turn3around %innovative
applications which may create opportunities to gain a future( )ey operational
%application that sustain the existing business operations( and support %application which
improve business efficiency and management effectiveness( depending on its current or
expected contribution to business success. Similar with Steria %&''
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Developing the application portfolio re#uires the proper selection of the approach
or methodologies since application portfolio consists of different types of applications
with their own values. Strategic applications may re#uire fast delivery to the mar)et to
gain competitive advantages and to put the barrier to the mar)et entry from the
competitors while the operational system may cope with the functional re#uirement
changes amid to the current system being used. Developing approaches come in different
models and framewor)s which inherently carry their own strength and wea)ness and
which do not address all the application portfolios. "ost of the development approach
gives the strong emphasis to how the system can be developed and how to get the
products done. $s stated from I+" nited Eingdom Bimited Application development
is often based upon tactical considerations rather than on an enterprises strategic
directions, making it difficult to realize both short- and long-term goals. %I+" &''1(
They neglect to pinpoint how the system can be developed with the priority of the
immediate business needs and for ta)ing the current competitive advantage
opportunities.
The system development life cycle is the overall process of developing
implementing and retiring information systems through a multi3step process from
initiation analysis design implementation and maintenance to disposal %Shirley :adac)
&''
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appropriate approach because waterfall is time consuming which is strategic application
needs speed of development in order to provide competitive advantage that business
environment )eep changing. Poor flexibility of waterfall model also becomes an obstacle
to meet the re#uirements. 4nce re#uirement change need cost and time to redevelop the
system once passed one phase can not bac)ward to previous phase.
$nother model of SDB8 is the Spiral "odel. Spiral model was developed by
+arry +oehm in !
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2ighly customized limiting re3usability
$pplied differently for each application
:is) of not meeting budget or schedule
Possibility to end up implemented as the waterfall framewor)
Several development processes or methodologies have been derived from the
classical waterfall models. Since waterfall model does not provide or strictly provides the
rooms for business re#uirement changes developing certain applications in the
application portfolio may suffer from the lac) of flexibility when process changes or new
business strategic concepts have to be implemented immediately. The modern
development models have been customized to provide the high level of efficiency and
effectiveness when moving bac)ward or forward across the development stages.
Pressman %&''F( categorized the prominent evolutionary models into incremental model
and spiral model.
$ccording to Pressman incremental model ta)es the view of the application
development as a set of components or features which carries their own deliverables.
;ach component is chun)ed into different incremented versions which are developed
incrementally and independently. or one of its examples from Pressman %&''F( &ord-
processing soft&are developed using the incremental paradigm might deliver basic file
management, editing, and document production functions in the first increment) more
sophisticated editing and document production capabilities in the second increment)
spelling and grammar checking in the third increment) and advanced page laout
capabilit in the fourth increment. %Pressman &''F p.1A(. +y subdividing the
components in the application into various versions development can be prioritized and
the critical version of the application can be highly focused. This model may be suitable
for upgrading the operational system in the application portfolio. That is because the
critical or prioritized versions will be developed in the fast manner since their sizes are
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smaller as compared to the full versions and users can start using the critical version as
soon as the deliverables are complete which leads to the decreasing of down time in
waiting for the whole system to be complete. urthermore application portfolio varies in
size. If the application is large the development will face with the biggest challenges of
high cost and insufficient man power. Incremental model can help relieve this situation in
which the big scale application can be developed on demand basis with the amount of
sufficient and affordable resources. $s pointed out by 8"S in their report Selecting a
Development $pproach %&''A( incremental model is appropriate in large pro!ect &here
the re*uirements are not &ell understood or are changing to the external changes,
changing expectation, budget changes or rapidl changing technolog. %8"S &''A(
Unlike waterfall model, iterative development approach enablesdevelopment to loop until the applications or products meet the
demands. According to Summerville (2001, iterative model consists of
a few manageable stages of development, basicall! the anal!sis and
design and implementation. "he implication from (Summerville, 2001
is that iterative model gives prides to customer views on the s!stem,
which means that the development will go iterativel! until the
customers accept the application. "he characteristics of iterative
model ma! be useful in developing the uncertain application,
turnaround application or the products that target the customers, or
the customer value added application. #n term of application portfolio
management, iterative model allows the business entit! to decide to
continue or stop the development in each revisiting. "his is true in the
business environment where the products can get out of demands at
an!time receiving the additional pressure from the competitor$s
products. %ontinue putting the investment in developing the
application portfolio will result in low &'# since the application being
developed gained little popularit! from customers. "he white paper
done b! #) in their white paper The Future of IT application
development (200* supported the fact that +Iterative development
!'
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allows organizations to smoothly blend resources across the project
lifecycle, making more eective, ecient use of business analysts,
subject matter eperts and developers! "nd it enables organizations to
leverage global resources as needed to outsource basic, functional
tasks!# (#), 200* #t also highlighted that +In addition to iterative
approaches, organizations will increasingly adopt lean development
models that minimize waste!#
As found in (Summerville, 2001 &apid
Application evelopment (&A is one of methodologies, which
conforms to the iterative model. ased on the characteristics and
strengths of iterative model mentioned, iterative model should be best
aligned to applications that target in providing added values to
customers for the fact that it centers on the customer views of demand
and satisfaction and that it accelerate the speed of development.
-owever, since great anal!sis and evaluation are put on customer
perspectives, man! eperienced anal!sts and skillful developers are
re/uired which ma! possibl! lead to the high cost of developing such
an application. #t ma! not be appropriatel! aligned to the application
portfolio running under the small or medium organiation at all if the
sie of the application is too large.
$nother modern development approach mentioned by Schach %&''F( is the incremental
and iterative model. This model incorporates both incremental and iterative nature into
application development. $ccording to Schach %&''F( applications developed using this
model pass through different stages. ;very stage has the same development phases which
consist of basic flows analysis design implementation and testing. ;ach stage
emphasizes different phase. The developing products are increasingly modeled and
invented until they reach the transition stage. This hybrid mode is superior in term of
re#uirement changes and strategic application development as compared to classical
approaches such as waterfall or linear models. The waterfall models li)e SS$D" do not
allow the rooms for re#uirement changes. In classical approaches all the re#uirements
must be defined and specified at the early stages. If the re#uirements are modified or
!!
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changed the development must move bac)ward from the current stages to the analysis or
re#uirement stages which lead to complexity and time consuming. In developing the
strategic application one of the applications in the portfolio incremental and iterative
model may contribute the most in helping the development successful since this model
allows developing the application little by little and ta)e into account all the changes on
demand. The strategy of the business must be flexibly changed overtime in order to
counter the product entry to the mar)et from the competitors. Seeing this fact the
structure or waterfall model might not be best aligned with this type of application.
$ccording to *ard = >riffiths %!
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3.3 Issues in applying develop!ent approaches to the application portfolio
$lthough most of the existing researches such as those mentioned in previous
sections imply the suitability of aligning the development models with different types of
applications in the portfolio there are some constraints that act as barriers preventing the
adaption of development models which leads to the side effects of alignment. This
research section will attempt to loo) at how organization and business structure influence
the alignment and the issues in aligning the development models to complex application
portfolios.
*ard and Peppard %&''&( pointed out the survey of &' S companies done by
Bederer and "endelow regarding the contribution of management to the successful IS/IT
development. The survey showed that 0top-management commitment &as a prere*uisite
for success, but it &as often difficult to obtain. "op management lacked a&areness of the
impact I(I" is having generall and did not understand ho& I(I" offered strategic
advantages. "he tended to see omputers in purel an operational context,6 %*ard =
Peppard &''& p. !&?(. It stated that top management loo)ed at computers as 7ust the
operational or functional support system ta)ing for grated its benefits in other types of
application portfolio such as strategic application. The top management point of view can
indirectly lead to adapting strictly and only the formal approach of application portfolio
development. Since the formal approaches such as SDB8 can wor) fine for the
operational system the decision to adapting the other flexible development models such
as iterative and incremental model might be bottle nec)ed in the top level management
since it traditionally falls into the fallacies that application portfolio is 7ust the
computerized system that re#uires only a particular development approaches such as
waterfall model and structure approaches.
In addition to the top management fallacies resource constraints and length of
time or time and cost constraint in development can also possibly and largely contribute
to the inflexibility of adapting the development models which is evidenced in the ;arls
survey of &! E companies %*ard = Peppard &''&(. +ased on the lesson learned in
;arls research it is difficult to 7ustify solely the suitability of the development
!1
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approaches in relation to the application portfolio if the applications to be developed are
large scaled and the resources to support the development are inade#uate. In this case the
development approach alone may not help but the proper pro7ect management
methodologies such as P:I58; should be invo)ed in the alignment so that the available
resources can be properly allocated and the development schedule can be effectively
managed.
$nother issue in developing the application portfolio is that some sets of system
are redundant. In a corporate strategy each unit of business may have different strategies
applied- low cost differentiation or targeting the niche mar)et. $gain as mentioned by
Prepard and *ard two business units within a corporation may use the same types of
system but their strategic visions of the system might be uni#ue. or exampleadministrative wor) can use the common software pac)ages 0'anufacturing and
financial services organizations &ill re*uire different sstems, but several tpes of retail
companies in different market sectors could easil use common accounting
sstem,%*ard = Peppard p.119(. The important thing to consider is whether or not the
system should be developed independently. To avoid developing redundant system
aiming different strategic values in business units the development approaches should
model the system as one component that can be later distributed to the different business
units. In previous section 44P paradigm with the incremental and iterative model can
address this problem and provide the solution. $nyways tailoring the component to
absolutely suit the business unit may ta)e time and cost which can result in down time.
So the priority setting for critical components to be developed should be ta)en into
consideration. This is the point where the invocation of the effective pro7ect management
methodologies should be invo)ed again.
The research on alignment between business and IS strategy done by %Sabherwal
= 8han &''!( implicitly indicated that the business types inherently had potential
influence on the application portfolio development. Sabherwal and 8han %&''!( used
%"iles = Snow !
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organizations with different types of business had different degrees of emphasis on each
IS attributes or application portfolio in this current study context. or example in term of
alignment the Defender tends to give application development priority to the operational
support system and decision support systems because it targets the specific core products
with less attention to differential strategyH whereas $nalyzer loo)s for the mar)et
information system inter3organizational system and decision support system. The study
shows the relatively accurate probability of '.? at least for each alignment.
+ased on Sabherwal and 8han %&''!( research the development models in certain
organizations may constraint to the characteristics of the business types. The Defender
which produces the core products may not have any ma7or issues in development models
or methodologies because the application portfolio is designed particularly for internal oroperational uses within the organization 7ust to enhance the product development process
and to speed up product delivery. The strategic application may not be the area of interest
in this type of business. The waterfall model and structure methodologies which give
prides to full details and high #uality of products should be aligned well to its application
portfolio since the Defender does not suffer the pressure of the strategic re#uirement
changes and the turn3around effects. Therefore it can be concluded that the rest of
business types also influence on the adapting or aligning the development approaches
with the application portfolio.
3.# "evelop!ent approach and application portfolio align!ent
There are some certain researches on the alignment of the development
approaches with the application portfolio. "ost of the researches do not explicitly
address the issues of alignment but only the surrounding issues in the alignment process
specifically the alignment of the application with the business strategy. Interestingly this
actual research area was brought in by *ard and Peppard %&''&( who presented the
details of the alignment recommendation and its suitability. $vison and itzgerald %&''?(
also came up with the suggestion of the methodologies for application development in the
business context. 4ther various researches also have contribution to this area. This
!A
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section will present schools of thought and facts of aligning the development with the
application portfolio from various existing researches.
*ard and Peppard %&''&( pointed that alignment should be dynamically based on
the criteria of complexity speed of development cost #uality and the strategic values of
the application not solely on the characteristics of development approach.
irst the applications in the strategic areas should be developed using the
incremental model iterative model or prototyping model since development process will
be extremely accelerated %*ard = Peppard &''&(. *ard and Peppard %&''&( 7ustified
that strategic applications need to be developed in the fast manner and re#uire the flexible
design which is crucial in )eeping the competitive advantages. This should be reasonable
because strategic applications are targeted for the competitive advantages in which cost is
not the big issue. 4n one hand the alignment of strategic applications with the mentioned
models sounds logical as some of the first IS/IT movers such as $merican $irline and
"cEesson did by putting considerable investment in developing the applications and
they were successful but on the other hand the Small and "edium ;nterprises %S";s(
may argue that they cannot afford such an investment because these models re#uires
s)ilful analysts developers and expensive tool sets li)e 8$S; tools. $s a result this
alignment does not address all the surrounding issues. There is a need to tolerate the cost
of investment in development. To minimize the cost Steria %&''
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and large IT team to support it. rom their points of view the operational application
should be aligned well with 7ust the formal structure approach if the business process will
not change very often. $nyways what if the other models such as incremental model and
iterative model are put into practice $ccording to $vison and itzgerald %&''?(
incremental model is crucially utilized when certain application demand is immediate
and iterative model is commonly used when the re#uirements often change and the
re#uirements are not clearly identified. $s a result the formal structure approaches
should gain the pride because in this era the business process will not be harshly changed
because of the globalized and standardized process. or example it is the fact that the
ban)ing processes in most of the ban)s conform to the standard which hardly change.
Third most of the support applications nowadays do not re#uired the in3housedevelopment at all. $s stated in the *ard and Peppard %&''&( considerable software
pac)ages in the mar)et are ready to be used to support the functions or individual tas)s in
the process. 0"he package should not be customized$ business processes and procedures
should be amended to fit the package, %*ard and Peppard &''&(. or example
purchasing "icrosoft 4ffice to facilitate the function in the business is obviously cheaper
than developing the whole 4ffice software pac)age. Pressman %&''?( also supported the
idea of purchasing the off3the3shelf pac)age to be used if it really 7ustifies the cost and
time of software development which is termed as not reinventing the &heel.2owever in
some situation the pac)age may need to be tailored to fully support the functions. If it is
the case *ard and Peppard %&''&( again suggested that the organization should see if the
tailoring can be outsourced using the appropriate outsourcing models avoiding
investment in the in3house development. Therefore for the support application it is
strongly emphasized that in3house development should be in low priority.
inally for the high potential or turnaround application it is advised to align it
with the development models that minimize the cost and accelerate the speed of
development %*ard = Peppard &''&(. That is because this type of application is
uncertain for the future investment and the opportunity of getting the acceptance from the
customers and users are ambiguous. $ccording to *ard and Peppard %&''&( again high
potential application should be viewed as the independent unit during the development so
!F
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that when the application is going to be abandoned it will not have impact to the existing
application in the portfolio. In this sense the development approaches for the high
potential application should be iterative model prototyping and incremental models. The
waterfall model or structure model should not be used in developing this application
because this model wal) through all the details of development processes which are very
costly and if the application is going to be abandoned all the invested efforts and cost
will be totally wasted. $nyways the opportunity of waste can happen also when the
application to be developed is complicated and technical research is greatly involved. To
alleviate this problem the development approaches should ta)e into account not only the
characteristic of the model but also surrounding factors that contribute to the success or
failure of the development. Pressman %&''?( came up with the matrix for measuring the
opportunity of success in application development. 2e suggested that before the
development process ta)es place the 9Ps %People Process Pro7ect and Product( should
be deeply analyzed. 2e pointed that the product to be developed should be compared
with the similar past pro7ect to see the rate of possibility and applicability. This fact draws
into the conclusion that for the uncertain applications li)e high potential application the
development approach should incorporate with 9Ps or similar past pro7ect matrix and
should be invo)ed late after 9Ps are deeply analyzed.
#. $onclusion
To sum up various issues including the problems in defining the application
portfolio have been identified and brought into discussion and analysis. +ased on this
research definition of application portfolio was defined as the collection of applications
that support business process and create the strategic values to the business. The
characteristics of the development approaches have been explored and critically analyzed
in the domain of business needs and values. This research concludes that all thedevelopment approaches such as waterfall model iterative incremental and those
mentioned in the analysis section have the e#ual weight although some are old because it
still can be functional and bring bac) success to the application development and
business needs but the context of aligning them to the application portfolio must be ta)en
into 7ustification before adapting any of them by loo)ing at the surrounding factors such
!C
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as organizational factors size of the business li)e S"; top level management support
resource constraints and application redundancy. Suggested methods of loo)ing at them
could be P;ST analysis and 9Ps. The missing areas of the previous researches were
explored in depth using the deductive ways. 2owever these missing areas were based on
the deductive approach which is not very accurate. The further research should
encompass the inductive approach where the empirical analysis should be held until the
relatively accurate artifacts are found. or the final conclusion it is recommended that to
align the development approach with the application portfolio the organization should
consider all the mentioned issues. "oreover currently there are several new and practical
methodologies such as agile and JP. It is suggested that the later research should ta)e a
loo) into these methodologies whether or not they can be aligned effectively within
different application portfolios in different contexts of business.
!
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References
$pplication Portfolio "anagement %&'!'(0o& to 1se Application 2ortfolio
'anagement K4nlineL. $vailable from%
http-//www.applicationportfoliomanagement.com/how3to3use3application3portfolio3management.aspx.K$ccessed &! $pril &'!'L
$vison D. = itzgerald >. %&''?(.Information (stems +evelopment. 9th;d.E-
"c>raw32ill Publishing 8ompany.
$zad $. +arnard ". = @ohnson E. %&''F(. "he future of I" application development.$vailable from- http-//www3raw32ill Publishing 8ompany.
:adac) S. %&''
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Sabherwal :. 8han N.;. %&''!(Alignment bet&een %usiness and I( (trategies$ a stud
of prospectors, analzers, and defenders. Information Systems :esearch
Schach :. %&''F( /b!ect-/riented 7 lassical (oft&are #ngineering Fth ;d S-"c>raw32ill.
Sommerville I. %&''!( (oft&are #ngineering ?th ;d ;ngland- Pearson ;ducation
Bimited.
Steria %&''riffiths P. %!