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McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter 6
Systems
Development:
Phases, Tools, and
Techniques
6-2
STUDENT LEARNING
OUTCOMES
1. Define the traditional systems
development life cycle (SDLC) and
describe the 7 major phases within
it.
2. Compare and contrast the various
component-based development
methodologies.
3. Describe the selfsourcing process as
an alternative to the traditional
SDLC.
6-3
STUDENT LEARNING
OUTCOMES
4. Discuss the importance of
prototyping and prototyping within
any systems development
methodology
5. Describe the outsourcing
environment and how outsourcing
works.
6-4
CAMERAS USE FILM?
6-5
CAMERAS USE FILM?
 The preceding slide – Kodak 35mm
film sales dropped from $7 billion in
2004 to an estimated $1.9 billion in
2010
 Many retailers no longer process
35mm film
 Web sites like SnapFish, Photo
Bucket, and Flickr are now the norm
6-6
CAMERAS USE FILM?
1. Do you own a 35mm camera? Last
time you had 35mm film processed?
2. Will smartphones spell the end of
digital cameras?
3. Do you know someone who owns a
35mm camera? What do they use it
for?
6-7
INTRODUCTION
 Information systems are the support
structure for meeting the company’s
strategies and goals
 New systems are created because
employees request them
 New systems are created to obtain a
competitive advantage
6-8
INTRODUCTION
 When developing a new system, you
have 3 “who” choices…
1. Insourcing – IT specialists inside your
organization
2. Selfsourcing – do-it-yourself
approach many end users take with
little or no help from IT specialists
3. Outsourcing – a third-party
organization (i.e., let someone do the
work and pay them for it)
6-9
CHAPTER ORGANIZATION
1. Insourcing and the SDLC
 Learning outcome #1
2. Component-Based Development
 Learning outcome #2
3. Selfsourcing
 Learning outcome #3
4. Prototyping
 Learning outcome #4
5. Outsourcing
 Learning outcome #5
6-10
INSOURCING AND THE SDLC
 Systems development life cycle
(SDLC) - a structured step-by-step
approach for developing information
systems
 7 distinct phases
 Also called a waterfall
methodology, an approach in
which each phase of the SDLC is
followed by another, from planning
through implementation
6-11
SDLC Phases & Major Activities
6-12
SDLC as a Waterfall
Methodology
6-13
Phase 1: Planning
 Planning phase - create a solid
plan for developing your information
system
 Three primary planning activities:
1. Define the system to be developed
 You can’t build every system, so you make
choices based on your organization’s
priorities, which may be expressed as
critical success factors
 Critical success factor (CSF) - a factor
simply critical to your organization’s success
6-14
Phase 1: Planning
2. Set the project scope
 Project scope - clearly defines the high-
level system requirements
 Scope creep - occurs when the scope of
the project increases
 Feature creep - occurs when developers
add extra features that were not part of the
initial requirements
 Project scope document - a written
definition of the project scope and is
usually no longer than a paragraph
6-15
Phase 1: Planning
3. Develop the project plan including
tasks, resources, and timeframes
 Project plan - defines the what, when,
and who questions of system development
 Project manager - an individual who is
an expert in project planning and
management, defines and develops the
project plan and tracks the plan to ensure
all key project milestones are completed on
time
 Project milestones - represent key dates
for which you need a certain group of
activities performed
6-16
Phase 1: Planning
Sample Project
Plan
6-17
Phase 2: Analysis
 Analysis phase - involves end users
and IT specialists working together to
gather, understand, and document
the business requirements for the
proposed system
6-18
Phase 2: Analysis
 Two primary analysis activities:
1. Gather the business requirements
 Business requirements - the detailed set
of knowledge worker requests that the
system must meet in order to be successful
 Business requirements address the “why”
and “what” of your development activities
 Joint application development (JAD) -
knowledge workers and IT specialists meet,
sometimes for several days, to define or
review the business requirements for the
system
6-19
Phase 2: Analysis
2. Prioritize the requirements
 Requirements definition document –
prioritizes the business requirements and
places them in a formal comprehensive
document
 Again, you probably can’t do everything, so
prioritizing is important
 Users sign off on this document which
clearly sets the scope for the project
6-20
Phase 2: Analysis
Take time during analysis to get the business requirements correct. If you find
errors, fix them immediately. The cost to fix an error in the early stages of the
SDLC is relatively small. In later stages, the cost is huge.
6-21
Phase 3: Design
 Design phase - build a technical
blueprint of how the proposed
system will work
 Two primary design activities:
1. Design the technical architecture
 Technical architecture - defines the
hardware, software, and
telecommunications equipment required to
run the system
6-22
Phase 3: Design
2. Design system models
 This includes GUI screens that users will
interface with, database designs (see
XLM/C), report formats, software steps, etc
 Starting with design, you take on
less of an active participation role
and act more as a “quality control”
function, ensuring that the IT people
are designing a system to meet your
needs
6-23
Phase 4: Development
 Development phase - take all of
your detailed design documents from
the design phase and transform
them into an actual system
 Two primary development activities:
1. Build the technical architecture
2. Build the database and programs
 Both of these activities are mostly
performed by IT specialists
6-24
Phase 5: Testing
 Testing phase - verifies that the
system works and meets all of the
business requirements defined in
the analysis phase
 Two primary testing activities:
1. Write the test conditions
 Test conditions - the detailed steps the
system must perform along with the
expected results of each step
6-25
Phase 5: Testing
2. Perform the testing of the system
 Unit testing – tests individual units of code
 System testing – verifies that the units of
code function correctly when integrated
 Integration testing – verifies that
separate systems work together
 User acceptance testing (UAT) –
determines if the system satisfies the
business requirements
6-26
Phase 6: Implementation
 Implementation phase -
distribute the system to all of the
knowledge workers and they begin
using the system to perform their
everyday jobs
 Two primary implementation
activities
1. Write detailed user documentation
 User documentation - highlights how to
use the system
6-27
Phase 6: Implementation
2. Provide training for the system users
 Online training - runs over the Internet
or off a CD-ROM
 Workshop training - is held in a
classroom environment and lead by an
instructor
6-28
Phase 6: Implementation
 Choose the right implementation
method
 Parallel implementation – use both
the old and new system simultaneously
 Plunge implementation – discard the
old system completely and use the new
 Pilot implementation – start with
small groups of people on the new
system and gradually add more users
 Phased implementation – implement
the new system in phases
6-29
Phase 7: Maintenance
 Maintenance phase - monitor
and support the new system to
ensure it continues to meet the
business goals
 Two primary maintenance activities:
1. Build a help desk to support the system
users
 Help desk - a group of people who
responds to knowledge workers’ questions
2. Provide an environment to support
system changes
6-30
COMPONENT-BASED
DEVELOPMENT
 The SDLC focuses only on the project
at hand
 Component-based development
(CBD) – focuses on building small
self-contained blocks of code
(components) that can be reused
across a variety of applications
1. Using already-developed components
2. Building new components as needed
6-31
Component-Based
Development Methodologies
 Rapid application development (RAD)
 Extreme programming (XP)
 Agile methodology
6-32
Rapid Application
Development (RAD)
 Rapid application development (RAD)
(also called rapid prototyping) -
emphasizes extensive user involvement in
the rapid and evolutionary construction of
working prototypes of a system to
accelerate systems development
 Prototypes are models of software
 The development team continually designs,
develops, and tests the component prototypes
until they are finished
6-33
Rapid Application
Development (RAD)
Build new
software
components
Use already-
existing
software
components
6-34
Extreme Programming (XP)
 Extreme programming (XP) - breaks
a project into tiny phases and developers
cannot continue on to the next phase
until the first phase is complete
6-35
Agile Methodology
 Agile methodology - a form of XP,
aims for customer satisfaction
through early and continuous
delivery of useful software
components
6-36
SoA – An Architecture
Perspective
 Service-oriented architecture
(SoA) – perspective that focuses on
the development, use, and reuse of
small self-contained blocks of code
(called services) to meet all
application software needs
 All CBD methodologies adhere to an SoA
 Services are the same as components,
which are the same as small self-
contained blocks of code
6-37
SELFSOURCING
 Selfsourcing (end-user
development) – the development
and support of IT systems by end
users with little or no help from IT
specialists
 Do-it-yourself systems development
approach
 Can relieve IT specialists of the
burden of developing many smaller
systems
6-38
Selfsourcing Approach
 Is similar to traditional SDLC
 Big exception is that design,
development, testing, and
implementation are replaced by the
process of prototyping
 Prototyping is the process of building
models, and – in this case –
continually refining those models
until they become the final system
6-39
Selfsourcing Approach
6-40
Selfsourcing Advantages
 Improves requirements determination
 Increases end user participation and
sense of ownership
 Increases speed of development
 Reduces invisible backlog
 Invisible backlog – list of all systems
that an organization needs to develop
but never get funded because of the lack
of organizational resources
6-41
Selfsourcing Disadvantages
 Inadequate end user expertise leads
to inadequately developed systems
 Lack of organizational focus creates
“privatized” IT systems
 Insufficient analysis of design
alternatives leads to subpar IT
systems
 Lack of documentation and external
support leads to short-lived systems
6-42
The Right Tool for the Job
 End users must have development
tools that:
 Are easy to use
 Support multiple platforms
 Offer low cost of ownership
 Support a wide range of data types
6-43
PROTOTYPING
 Prototype – a model of a proposed
product, service, or system
 Prototyping - the process of building a
model that demonstrates the features of
a proposed product, service, or system
 Proof-of-concept prototype - prove the
technical feasibility of a proposed system
 Selling prototype - used to convince
people of the worth of a proposed system
6-44
The Prototyping Process
 The prototyping process involves
four steps:
1. Identify basic requirements
2. Develop initial prototype
3. User review
4. Revise and enhance the prototype
6-45
The Prototyping Process
6-46
Advantages of Prototyping
 Encourages active user participation
 Helps resolve discrepancies among
users
 Gives users a feel for the final system
 Helps determine technical feasibility
 Helps sell the idea of a proposed
system
6-47
Disadvantages of Prototyping
 Leads people to believe the final
system will follow
 Gives no indication of performance
under operational conditions
 Leads the project team to forgo
proper testing and documentation
6-48
OUTSOURCING
 Outsourcing – the delegation of
specified work to a third party for a
specified length of time, at a
specified cost, and at a specified
level of service
 The third “who” option of systems
development, after insourcing and
selfsourcing
6-49
OUTSOURCING
 The main reasons behind the rapid
growth of the outsourcing industry
include the following:
 Globalization
 The Internet
 Growing economy and low
unemployment rate
 Technology
 Deregulation
6-50
Outsourcing Options
 IT outsourcing for software development
can take one of four forms:
1. Purchase existing software
2. Purchase existing software and pay the
publisher to make certain modifications
3. Purchase existing software and pay the
publisher for the right to make modifications
yourself
4. Outsource the development of an entirely
new and unique system for which no
software exists
6-51
Outsourcing Options
6-52
Outsourcing Process
 Like selfsourcing, the selfsourcing
process looks similar to the
traditional SDLC
 Big exception here is that you
“outsource” most of the work to
another company
6-53
Outsourcing Process
When outsourcing, you’ll develop two vitally
important documents – a request for proposal and a
service level agreement
6-54
Outsourcing – RFP
 Request for proposal (RFP) – formal
document that describes in excruciating detail
your logical requirements for a proposed
system and invites outsourcing organizations
to submit bids for its development
 In outsourcing, you must tell another organization
what you want developed; you do that with an
RFP
 Therefore, the RFP must be very detailed
 Some RFPs can take years to develop
6-55
Outsourcing – SLA
 Service level agreement (SLA) - formal
contractually obligated agreement between
two parties
 In outsourcing, it is the legal agreement
between you and the vendor and specifically
identifies what the vendor is going to do (and
by when) and how much you’re going to pay
 Supporting SLA documents – service level
specifications and service level objectives
– contain very detailed numbers and metrics
6-56
Outsourcing Options
 There are three different forms of
outsourcing:
1. Onshore outsourcing - the process of
engaging another company within the
same country for services
2. Nearshore outsourcing - contracting
an outsourcing arrangement with a
company in a nearby country
3. Offshore outsourcing - contracting with
a company that is geographically far away
6-57
Offshore Outsourcing
 Primary outsourcing countries are:
 India
 China
 Eastern Europe (including Russia)
 Ireland
 Israel
 Philippines
6-58
The Advantages and
Disadvantages of
Outsourcing
 Advantages:
 Focus on unique core competencies
 Exploit the intellect of another
organization
 Better predict future costs
 Acquire leading-edge technology
 Reduce costs
 Improve performance accountability
6-59
 Disadvantages:
 Reduces technical know-how for future
innovation
 Reduces degree of control
 Increases vulnerability of your strategic
information
 Increases dependency on other
organizations
The Advantages and
Disadvantages of Outsourcing

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Chapter006Systems Development: Phases, Tools, and Techniques

  • 1. McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 6 Systems Development: Phases, Tools, and Techniques
  • 2. 6-2 STUDENT LEARNING OUTCOMES 1. Define the traditional systems development life cycle (SDLC) and describe the 7 major phases within it. 2. Compare and contrast the various component-based development methodologies. 3. Describe the selfsourcing process as an alternative to the traditional SDLC.
  • 3. 6-3 STUDENT LEARNING OUTCOMES 4. Discuss the importance of prototyping and prototyping within any systems development methodology 5. Describe the outsourcing environment and how outsourcing works.
  • 5. 6-5 CAMERAS USE FILM?  The preceding slide – Kodak 35mm film sales dropped from $7 billion in 2004 to an estimated $1.9 billion in 2010  Many retailers no longer process 35mm film  Web sites like SnapFish, Photo Bucket, and Flickr are now the norm
  • 6. 6-6 CAMERAS USE FILM? 1. Do you own a 35mm camera? Last time you had 35mm film processed? 2. Will smartphones spell the end of digital cameras? 3. Do you know someone who owns a 35mm camera? What do they use it for?
  • 7. 6-7 INTRODUCTION  Information systems are the support structure for meeting the company’s strategies and goals  New systems are created because employees request them  New systems are created to obtain a competitive advantage
  • 8. 6-8 INTRODUCTION  When developing a new system, you have 3 “who” choices… 1. Insourcing – IT specialists inside your organization 2. Selfsourcing – do-it-yourself approach many end users take with little or no help from IT specialists 3. Outsourcing – a third-party organization (i.e., let someone do the work and pay them for it)
  • 9. 6-9 CHAPTER ORGANIZATION 1. Insourcing and the SDLC  Learning outcome #1 2. Component-Based Development  Learning outcome #2 3. Selfsourcing  Learning outcome #3 4. Prototyping  Learning outcome #4 5. Outsourcing  Learning outcome #5
  • 10. 6-10 INSOURCING AND THE SDLC  Systems development life cycle (SDLC) - a structured step-by-step approach for developing information systems  7 distinct phases  Also called a waterfall methodology, an approach in which each phase of the SDLC is followed by another, from planning through implementation
  • 11. 6-11 SDLC Phases & Major Activities
  • 12. 6-12 SDLC as a Waterfall Methodology
  • 13. 6-13 Phase 1: Planning  Planning phase - create a solid plan for developing your information system  Three primary planning activities: 1. Define the system to be developed  You can’t build every system, so you make choices based on your organization’s priorities, which may be expressed as critical success factors  Critical success factor (CSF) - a factor simply critical to your organization’s success
  • 14. 6-14 Phase 1: Planning 2. Set the project scope  Project scope - clearly defines the high- level system requirements  Scope creep - occurs when the scope of the project increases  Feature creep - occurs when developers add extra features that were not part of the initial requirements  Project scope document - a written definition of the project scope and is usually no longer than a paragraph
  • 15. 6-15 Phase 1: Planning 3. Develop the project plan including tasks, resources, and timeframes  Project plan - defines the what, when, and who questions of system development  Project manager - an individual who is an expert in project planning and management, defines and develops the project plan and tracks the plan to ensure all key project milestones are completed on time  Project milestones - represent key dates for which you need a certain group of activities performed
  • 17. 6-17 Phase 2: Analysis  Analysis phase - involves end users and IT specialists working together to gather, understand, and document the business requirements for the proposed system
  • 18. 6-18 Phase 2: Analysis  Two primary analysis activities: 1. Gather the business requirements  Business requirements - the detailed set of knowledge worker requests that the system must meet in order to be successful  Business requirements address the “why” and “what” of your development activities  Joint application development (JAD) - knowledge workers and IT specialists meet, sometimes for several days, to define or review the business requirements for the system
  • 19. 6-19 Phase 2: Analysis 2. Prioritize the requirements  Requirements definition document – prioritizes the business requirements and places them in a formal comprehensive document  Again, you probably can’t do everything, so prioritizing is important  Users sign off on this document which clearly sets the scope for the project
  • 20. 6-20 Phase 2: Analysis Take time during analysis to get the business requirements correct. If you find errors, fix them immediately. The cost to fix an error in the early stages of the SDLC is relatively small. In later stages, the cost is huge.
  • 21. 6-21 Phase 3: Design  Design phase - build a technical blueprint of how the proposed system will work  Two primary design activities: 1. Design the technical architecture  Technical architecture - defines the hardware, software, and telecommunications equipment required to run the system
  • 22. 6-22 Phase 3: Design 2. Design system models  This includes GUI screens that users will interface with, database designs (see XLM/C), report formats, software steps, etc  Starting with design, you take on less of an active participation role and act more as a “quality control” function, ensuring that the IT people are designing a system to meet your needs
  • 23. 6-23 Phase 4: Development  Development phase - take all of your detailed design documents from the design phase and transform them into an actual system  Two primary development activities: 1. Build the technical architecture 2. Build the database and programs  Both of these activities are mostly performed by IT specialists
  • 24. 6-24 Phase 5: Testing  Testing phase - verifies that the system works and meets all of the business requirements defined in the analysis phase  Two primary testing activities: 1. Write the test conditions  Test conditions - the detailed steps the system must perform along with the expected results of each step
  • 25. 6-25 Phase 5: Testing 2. Perform the testing of the system  Unit testing – tests individual units of code  System testing – verifies that the units of code function correctly when integrated  Integration testing – verifies that separate systems work together  User acceptance testing (UAT) – determines if the system satisfies the business requirements
  • 26. 6-26 Phase 6: Implementation  Implementation phase - distribute the system to all of the knowledge workers and they begin using the system to perform their everyday jobs  Two primary implementation activities 1. Write detailed user documentation  User documentation - highlights how to use the system
  • 27. 6-27 Phase 6: Implementation 2. Provide training for the system users  Online training - runs over the Internet or off a CD-ROM  Workshop training - is held in a classroom environment and lead by an instructor
  • 28. 6-28 Phase 6: Implementation  Choose the right implementation method  Parallel implementation – use both the old and new system simultaneously  Plunge implementation – discard the old system completely and use the new  Pilot implementation – start with small groups of people on the new system and gradually add more users  Phased implementation – implement the new system in phases
  • 29. 6-29 Phase 7: Maintenance  Maintenance phase - monitor and support the new system to ensure it continues to meet the business goals  Two primary maintenance activities: 1. Build a help desk to support the system users  Help desk - a group of people who responds to knowledge workers’ questions 2. Provide an environment to support system changes
  • 30. 6-30 COMPONENT-BASED DEVELOPMENT  The SDLC focuses only on the project at hand  Component-based development (CBD) – focuses on building small self-contained blocks of code (components) that can be reused across a variety of applications 1. Using already-developed components 2. Building new components as needed
  • 31. 6-31 Component-Based Development Methodologies  Rapid application development (RAD)  Extreme programming (XP)  Agile methodology
  • 32. 6-32 Rapid Application Development (RAD)  Rapid application development (RAD) (also called rapid prototyping) - emphasizes extensive user involvement in the rapid and evolutionary construction of working prototypes of a system to accelerate systems development  Prototypes are models of software  The development team continually designs, develops, and tests the component prototypes until they are finished
  • 33. 6-33 Rapid Application Development (RAD) Build new software components Use already- existing software components
  • 34. 6-34 Extreme Programming (XP)  Extreme programming (XP) - breaks a project into tiny phases and developers cannot continue on to the next phase until the first phase is complete
  • 35. 6-35 Agile Methodology  Agile methodology - a form of XP, aims for customer satisfaction through early and continuous delivery of useful software components
  • 36. 6-36 SoA – An Architecture Perspective  Service-oriented architecture (SoA) – perspective that focuses on the development, use, and reuse of small self-contained blocks of code (called services) to meet all application software needs  All CBD methodologies adhere to an SoA  Services are the same as components, which are the same as small self- contained blocks of code
  • 37. 6-37 SELFSOURCING  Selfsourcing (end-user development) – the development and support of IT systems by end users with little or no help from IT specialists  Do-it-yourself systems development approach  Can relieve IT specialists of the burden of developing many smaller systems
  • 38. 6-38 Selfsourcing Approach  Is similar to traditional SDLC  Big exception is that design, development, testing, and implementation are replaced by the process of prototyping  Prototyping is the process of building models, and – in this case – continually refining those models until they become the final system
  • 40. 6-40 Selfsourcing Advantages  Improves requirements determination  Increases end user participation and sense of ownership  Increases speed of development  Reduces invisible backlog  Invisible backlog – list of all systems that an organization needs to develop but never get funded because of the lack of organizational resources
  • 41. 6-41 Selfsourcing Disadvantages  Inadequate end user expertise leads to inadequately developed systems  Lack of organizational focus creates “privatized” IT systems  Insufficient analysis of design alternatives leads to subpar IT systems  Lack of documentation and external support leads to short-lived systems
  • 42. 6-42 The Right Tool for the Job  End users must have development tools that:  Are easy to use  Support multiple platforms  Offer low cost of ownership  Support a wide range of data types
  • 43. 6-43 PROTOTYPING  Prototype – a model of a proposed product, service, or system  Prototyping - the process of building a model that demonstrates the features of a proposed product, service, or system  Proof-of-concept prototype - prove the technical feasibility of a proposed system  Selling prototype - used to convince people of the worth of a proposed system
  • 44. 6-44 The Prototyping Process  The prototyping process involves four steps: 1. Identify basic requirements 2. Develop initial prototype 3. User review 4. Revise and enhance the prototype
  • 46. 6-46 Advantages of Prototyping  Encourages active user participation  Helps resolve discrepancies among users  Gives users a feel for the final system  Helps determine technical feasibility  Helps sell the idea of a proposed system
  • 47. 6-47 Disadvantages of Prototyping  Leads people to believe the final system will follow  Gives no indication of performance under operational conditions  Leads the project team to forgo proper testing and documentation
  • 48. 6-48 OUTSOURCING  Outsourcing – the delegation of specified work to a third party for a specified length of time, at a specified cost, and at a specified level of service  The third “who” option of systems development, after insourcing and selfsourcing
  • 49. 6-49 OUTSOURCING  The main reasons behind the rapid growth of the outsourcing industry include the following:  Globalization  The Internet  Growing economy and low unemployment rate  Technology  Deregulation
  • 50. 6-50 Outsourcing Options  IT outsourcing for software development can take one of four forms: 1. Purchase existing software 2. Purchase existing software and pay the publisher to make certain modifications 3. Purchase existing software and pay the publisher for the right to make modifications yourself 4. Outsource the development of an entirely new and unique system for which no software exists
  • 52. 6-52 Outsourcing Process  Like selfsourcing, the selfsourcing process looks similar to the traditional SDLC  Big exception here is that you “outsource” most of the work to another company
  • 53. 6-53 Outsourcing Process When outsourcing, you’ll develop two vitally important documents – a request for proposal and a service level agreement
  • 54. 6-54 Outsourcing – RFP  Request for proposal (RFP) – formal document that describes in excruciating detail your logical requirements for a proposed system and invites outsourcing organizations to submit bids for its development  In outsourcing, you must tell another organization what you want developed; you do that with an RFP  Therefore, the RFP must be very detailed  Some RFPs can take years to develop
  • 55. 6-55 Outsourcing – SLA  Service level agreement (SLA) - formal contractually obligated agreement between two parties  In outsourcing, it is the legal agreement between you and the vendor and specifically identifies what the vendor is going to do (and by when) and how much you’re going to pay  Supporting SLA documents – service level specifications and service level objectives – contain very detailed numbers and metrics
  • 56. 6-56 Outsourcing Options  There are three different forms of outsourcing: 1. Onshore outsourcing - the process of engaging another company within the same country for services 2. Nearshore outsourcing - contracting an outsourcing arrangement with a company in a nearby country 3. Offshore outsourcing - contracting with a company that is geographically far away
  • 57. 6-57 Offshore Outsourcing  Primary outsourcing countries are:  India  China  Eastern Europe (including Russia)  Ireland  Israel  Philippines
  • 58. 6-58 The Advantages and Disadvantages of Outsourcing  Advantages:  Focus on unique core competencies  Exploit the intellect of another organization  Better predict future costs  Acquire leading-edge technology  Reduce costs  Improve performance accountability
  • 59. 6-59  Disadvantages:  Reduces technical know-how for future innovation  Reduces degree of control  Increases vulnerability of your strategic information  Increases dependency on other organizations The Advantages and Disadvantages of Outsourcing