Building Information SystemsCIS 2200
Kannan Mohan
Department of CIS
Zicklin School of Business, Baruch College
Copyright © 2009 John Wiley & Sons, Inc. Copyright © 2009 Kannan Mohan
Learning Objectives
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• Articulate the reasons for IT project failure
• Describe different software development methodologies that are commonly used
• Identify the criteria used to select an appropriate development methodology
Software Woes…• 1983: F16 autopilot flipped plane upside
down whenever it crossed the equator
• 1985: Arthritis-therapy microwave set patient’s heart pacemaker to 214, resulting in fatal coronary
• 1987: NORAD defense radar system mistook the Moon for a hostile incoming missile
Software Woes…• 1988: Bank of America
• Spent $ 23 Million on MasterNet• A computerized accounting and reporting system
• Spent another $ 60 million to make it work and finally gave up
• Lost billions of dollars of customer accounts
Software Woes…• 1990: Vancouver Stock exchange index
rose 50% when 2 years of round-off errors in the program were corrected
• 1992: “Compatible” teller machines of 2 British banks handled leap years differently, withholding cash and confiscating cards during New Year Holiday
Recent Significant IT FailuresCompany Year Outcome
Hudson Bay (Canada)
2005 Inventory system problems lead to $33.3 million loss.
UK Inland Revenue 2004/5
$3.45 billion tax-credit overpayment caused by software errors.
Avis Europe PLC (UK)
2004 Enterprise resource planning (ERP) system cancelled after $54.5 million spent.
Ford Motor Co. 2004 Purchasing system abandoned after deployment costing approximately $400 M
Hewlett-Packard Co. 2004 ERP system problems contribute to $160 million loss.
AT&T Wireless 2004 Customer relations management system upgrade problems lead to $100M loss
Reasons?• Inaccurate understanding of end-user needs
• Inability to deal with changing requirements
• Software that is hard to maintain
• Late discovery of serious flaws
• Lack of focus on quality
Why Should We Care?
(Dennis et al, 2007) 8
Time
Comparing Software Development Methodologies
XP - Extreme Programming (Beck, 1999)
Software Development Life Cycle Costs
Requirements
Design
Implementation
Maintenance
10
Cost of Fixing Problems
0
100
200
300
400
500
600
700
800
900
Requirements Design Code DevelopmentTest
AcceptanceTest
Operation
Co
st
to f
ix
11
Software Faults
Requirements Design Construction Operation0
10
20
30
40
50
60
Errors Introduced
Errors Observed% of all faults
12
Selecting the Right MethodologyUsefulness for
Waterfall Prototyping
Throwaway Prototyping
Extreme Programming
Unclear user requirements
Poor Excellent Excellent Excellent
Unfamiliar technology
Poor Poor Excellent Poor
Complex systems
Good Poor Excellent Poor
Reliable systems
Good Poor Excellent Good
Short time schedule
Poor Excellent Good Excellent
Schedule visibility
Poor Excellent Good Good
(Dennis et al, 2007)
Project Risks
(Tiwana and Keil, 2004)
(Tiwana & Keil, 2004)
Process Maturity• SEI (Software Engineering Institute) CMMI
(Capability Maturity Model Integration)
• Maturity levels
Level Maturity
1 Initial
2 Managed
3 Defined
4 Quantitatively Managed
5 Optimizing15
Offshoring and Outsourcing
In-house Outsourced
Onshore Traditional model
Subcontractor/ third party in the same locale
Offshore
Foreign branch of the same company (captive center)
Subcontractor/third party in a foreign locale
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OffshoringDrivers
Challenges
Japanese Model of Offshoring
• Tap the stone bridge before crossing
• Expertise vs. cost
• Modularize
• Control by design
• Bridge software engineers
18
Cultural Differences
• Organizational culture• Centralized vs. decentralized decision making
• Organic vs. mechanistic
• National culture
• Power distance• Long term
orientation• Individualism/
collectivism• Uncertainty
avoidance
• Guanxi• Jugaad• Mianzi (Face)• Doctrine of Mean
Reporting Bad News
• Who do you rely on to get project status information?• Trust but verify
• When does misreporting happen?• Consider individual traits – risk propensity, work climate,
cultural differences
• Auditing to seek accurate project status? • Dysfunctional cycle of distrust, trust in supervisor
• Connection between project sponsor and propensity to report• Reducing power distance in reporting relationships
• Deaf and mum effect (Keil et al, 2014)
Summary
• What are the different software development methodologies that are commonly used?
• Why do IT projects fail?
• How do you select an appropriate methodology based on project characteristics?
• Articulate the drivers and challenges of offshoring and any variations in offshoring practices.
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