To: The Procurement Department
Thru: The Chief Information Officer
From: The IT Officer
Date: 27th January, 2019
Subj: Software Acquisition
Having evaluated the different methods of software acquisition, I write to recommend that the Bank should consider Purchasing Software Package as opposed to In-House Software Development.
Please find attached overleaf the rationale and justification for the need to purchase the software.
I look forward to a positive response.
Rationale for Acquisition
As a financial institution, our organization needs to continuously invest in technology in order to remain efficient and serve customers better. In adopting newer technology, the bank can save time and maximize employee resources, while remaining competitive, hence achieving productivity. While shopping for and deploying new software is an involving process, it is obvious that there are many vendors who have software products that can serve our current requirement. The benefits and advantages of procuring packaged software are highlighted below.
Lower Cost: Acquiring software package is cheaper because companies that developed the software do so bearing in mind that there would be many customers, hence spreading software development costs. Once this is done, the cost of buying the packages is reduced. On the other hand, undertaking product development is a long and expensive process.
Less Implementation Time: A purchased software has already been designed, programmed, tested, and documented. Therefore, deployment, installation, and implementation takes very minimum time.
Proven Reliability and Performance Benchmarks: One core advantage of purchasing software that is in the market is that any challenges or problems have been identified and possibly fixed by the vendor, because every software is evaluated and rated by the many users, hence a proof of reliability.
Less need for Technical Development Staff: Design and development of software involves many developers and programmers. However, purchasing software reduces the need to have so many technical staff in the IT department, because software purchased always have their documents and deployment instructions and there is always support from the vendor during implementation and throughout the ownership of the software. In addition, vendors offer software training to the IT staff regarding the use of the software.
Future Upgrades will be done by Vendor: Every Software needs a regular upgrade and/or release. It is the role of the vendor to provide regular upgrades of newer versions of a given software to enhance its efficiency. This is a more proactive reason of purchasing a software than designing an in-house one.
Software Development Life Cycle (SDLC) and Applicability in Software Acquisition
SDLC helps to identify current software problems and this is done by engaging all stakeholders (customers, salespeople, industry experts, and programmers) to map out problems associated with the current software and propose how it can be improved.
Planning is necessary in order to what is required and a plan that defines requirements of the new software, determining the cost as well as resources required. Furthermore, it helps in identifying the risks involved and proposes mitigation methods. Here, a Software Requirement Specification document is now created (Stackify, 2017).
The Design phase of the SDLC helps to translate software specifications into a design plan known as Design specification. At this point, stakeholders review this plan and offer feedback and suggestions. Stakeholder input is critical in ensuring the software meets the criteria and requirements. Otherwise failure will lead to cost overrun.
In order to build what is needed, the Building stage develops software by generating actual code based on instructions of the previous stages. Once this is accomplished, the software is tested in order to verify whether what was required is actually what has been produced. Testing is also necessary to establish whether deficiencies and defects in the software exist, and if there are, then they are fixed until they meet the intended specifications (Swersky, 2018).
Deployment of the software is done and this means starting to use the software. This phase of SDLC is originally done in a limited sense as feedback is received from end users, and adjustments are made based on that feedback. Finally, the software is maintained through continuous updating and advancing the software actually get closer to what is wanted by the organization.
Peter-Lo (2007). Methods of Software Acquisition. Retrieved at: http://www.peter-lo.com/Teaching/B2001/L04.pdf
Stackify (2017). What is SDLC? Understand the Software Development Life Cycle. Retrieved at https://stackify.com/what-is-sdlc/
Swersky, D. (2018). The SDLC. 7 Phases, Popular Models, Benefits and more. Retrieved https://raygun.com/blog/software-development-life-cycle/
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