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Computer Software
I. CHAPTER OVERVIEW

This chapter reviews the basic features and trends in the major types of application software and system software used to support enterprise and end use computing. Section I: Section II: Application Software: End-User Applications System Software: Computer System Management

II. LEARNING OBJECTIVES


Learning Objective s 1. Describe several important trends occurring in computer software. 2. Give examples of several major types of application and system software. 3. Explain the purpose of several popular software packages for end-user productivity and collaborative computing. 4. Define and describe the functions of an operating system. 5. Describe the main uses of computer programming software, tools, and languages.

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III. SUMMARY
Software. Computer software consists of two major types of programs: (1) application software that directs the performance of a particular use, or application, of computers to meet the information processing needs of users, and (2) system software that controls and supports the operations of a computer system as it performs various information processing tasks. Refer to Figure 4.2 for an overview of the major types of software. Application Software. Application software includes a variety of programs that can be segregated into generalpurpose and application-specific categories. General-purpose application programs perform common information processing jobs for end users. Examples are word processing, electronic spreadsheet, and presentation graphics programs. Application-specific programs accomplish information processing tasks that support specific business functions or processes, scientific or engineering applications, and other computer applications in society. System Software. System software can be subdivided into system management programs and system development programs. System management programs manage the hardware, software, network, and data resources of a computer system during its execution of information processing jobs. Examples of system management programs are operating systems, network management programs, database management systems, system utilities, application servers, and performance and security monitors. Network management programs support and manage telecommunications activities and network performance telecommunications networks. Database management systems control the development, integration, and maintenance of databases. Utilities are programs that perform routine computing functions, such as backing up data or copying files, as part of an operating system or as a separate package. System development programs like language translators and programming editors help IS specialists develop computer programs to support business processes. Operating Systems. An operating system is an integrated system of programs that supervises the operation of the CPU, controls the input/output storage functions of the computer system, and provides various support services. An operating system performs five basic functions: (1) a user interface for system and network communications with users, (2) resource management for managing the hardware resources of a computer system, (3) file management for managing files of data and programs, (4) task management for managing the tasks a computer must accomplish, and (5) utilities and other functions that provide miscellaneous support services. Programming Languages. Programming languages are a major category of system software. They require the use of a variety of programming packages to help programmers develop computer programs, and language translator programs to convert programming language instructions into machine language instruction codes. The five major levels of programming languages are machine languages, assembler languages, high-level languages, fourthgeneration languages, and object-oriented languages. Object-oriented languages like Java and special-purpose languages like HTML and XML are being widely used for Web-based business applications and services.

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IV. KEY TERMS AND CONCEPTS - DEFINED


1. Application Service Provider (127): Are companies that own operate, and maintain application software and the computer system resources (servers, system software, networks, and IT personnel) required to offer the use of application software for a fee as a service over the Internet. Application Software (114): General purpose or function specific software that provides a tool to help users complete general information processing tasks (such as word processing or spreadsheet calculations) or complete structured tasks (such as payroll or time tracking). Assembler Language (138): A programming language that uses a few letters and numbers to directly represent machine code or memory locations. CASE tools (146): Computer-Aided Software Engineering tools are software applications designed to support and standardize the activities associated with systems analysis, design, and programming. Custom software (114): Software developed for a specialized, one of a kind, application. COTS software (114): Commercial off-the-shelf software are applications which can be purchased commercially and do not require (or allow) any extensive customization Desktop Publishing (123): The use of microcomputers, laser printers, and page-makeup software to produce a variety of printed materials, formerly done only by professional printers. E-mail (120): The transmission, storage, and distribution of messages to specific addresses in electronic form over communications networks. Fourth-Generation Language - 4GL (139): Programming languages that are easier to use than high-level languages like BASIC, COBOL, or FORTRAN. They are also known as nonprocedural, natural, or very high-level languages.

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10. Function-specific application programs (118): Software which is designed to perform task-specific work or work only within a specific functional area of a business. 11. General-Purpose Application Programs (114): Programs that can perform format-specific information processing jobs such as word processing, electronic spreadsheets, and graphics programs. 12. Groupware (125): General purpose software that supports communications between members of a work group whose workstations are interconnected by a local area network. 13. High-Level Language (139): A programming language that uses macro instructions and statements that closely resembles human language or mathematical notation to describe the problem to be solved or the procedure to be used. 14. HTML (141): Is a language that creates formatted hypertext or hypermedia documents.

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15. Instant Messaging (121): Enables users to communicate textually in real time with other online associates. 16. Integrated Package (119): Software applications designed to seamlessly share functions and data. 17. Java (142): An object-oriented programming language created by Sun Microsystems with syntax similar to the "C" programming language and widely available on multiple platforms. 18. Language Translator (145): A program that converts the programming language instructions in a computer program into machine language code. Major types include assemblers, compilers, and interpreters. 19. Machine Language (138): A programming language where instructions are expressed in the binary code of the computer. 20. Middleware (138): Software that helps diverse software applications and networked computer systems exchange data and work together more efficiently. 21. Multitasking (133): The use of the same computer to accomplish several more than one information processing tasks concurrently. 22. Natural Language (140): A programming language that is very close to human language. Also called very high-level language. 23. Object-Oriented Language (140): Also considered 5th generation languages. A language that ties together data and software programs designed to manipulate that data. 24. Operating System (129): The main control program of a computer system. It is a system of programs that controls the execution of computer programs and may provide scheduling, debugging, input/output control, system accounting, compilation, storage assignment, data management, and related services. 25. Personal Information Manager PIM (125): A software package that helps end users store, organize, and retrieve text and numerical data in the form of notes, lists, memos, tasks, calendars, and schedules. 26. Presentation Graphics Software (124): Using computer-generated graphics to enhance the information presented in reports and other types of presentations. 27. Programming language (138): Allows a programmer to develop the sets of instructions that, if not already in machine code, a language translator will turn into machine executable instructions. 28. Software Suites (119): Are powerful, integrated software packages that combine several individual packages that share a common graphical interface and are designed to share data. 29. Spreadsheet package (123): Allows users to develop sophisticated calculators and mathematical models using an intuitive spreadsheet interface and a high level macro language. 30. System Software (129): Programs that control and support the operation of a computer system, including operating systems, file
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management applications, communications control programs, service and utility programs, and programming language translator programs. 31. User Interface (129): The part of a program that sends and receives information between the computer and the person using it. 32. Utilities (137): A standard set of routines that assist in the operation of a computer system by performing some frequently required process such as copying, sorting, or merging. 33. Virtual Memory (132): The use of secondary storage devices as an extension of the primary storage of the computer, thus giving the appearance of a larger main memory than actually exists. 34. Web Browser (120): A software package that provides the user interface for accessing Internet, intranet, and extranet web sites. 35. Web Services (143): Links business functions within applications for the exchange of data between companies via the Internet. 36. Word Processing Software (122): Software that produces documents. 37. XML - (142): Provides data and its meta-data to web pages.

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V. REVIEW QUIZ - Match one of the key terms and concepts


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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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30 2 24 1 4 5 31 6 33 21 14 26 18 32 11 10 34 8 29 36

Key Term
System software Application software Operating system Application service provider CASE tools Custom software User interface COTS software Virtual memory Multitasking HTML Presentation graphics software Language translator Utilities General-purpose application programs Function-specific application programs Web browser E-mail Spreadsheet package Word processing software

Q.
21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39

A.
7 25 16 28 12 19 3 13 9 23 22 27 14 37 17 24 20 15 35

Key Term
Desktop publishing Personal information manager Integrated package Software suites Groupware Machine language Assembler language High-level language Fourth-generation language Object-oriented language Natural language Programming language HTML XML Java Operating system Middleware Instant messaging Web services

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VI. ANSWERS TO DISCUSSION QUESTIONS


1. What major trends are occurring in software? What capabilities do you expect to see in future software packages? Trends Software will increasingly comply with the Americans with Disabilities Act (ADA). That is, it will support usage by people with visual, hearing, or movement-related disabilities. More applications will be able to diagnose and resolve faults as well us update themselves when manufacturers make fixes available. Simplified or "lite" applications designed for the PDA will become popular among novice computer users and users with older, less powerful machines. Applications will become increasingly interoperable due to the adoption of common format standards. Future Applications will inter-operate with collaboration management tools to enable document access and management control. At present this inter-operability isn't built in to the applications. Applications will inter-operate with workflow management tools allowing users to create and revise ad-hoc workflows. These digital workflows will help automate processes, establish process metrics, and automatically record productivity information. These workflow features will be simple enough for a manager to create even a single-use ad-hoc workflow but powerful enough for this one-time use application become the new process standard for the organization. Simple reporting tools will allow managers to discover process bottlenecks and evaluate both process and employee productivity. 2. How do the different roles of system software and application software affect you as a business end user? How do you see this changing in the future? End-user affects The choice in operating systems affects what applications run on the machine. Not all applications run on all operating systems. As a result, end-users will rarely have a choice regarding operating system selection. While end-uses will primarily work within various applications, they will interact directly with the operating system when navigating between applications and files. This poses a challenge not only when considering software for purchase for using within an organization (presumably standardized on a single desktop operating system), but also when developing software to share with end-users who may be using any one of a number of operating systems. Future Employees' interactions with their operating systems will continue to decline as document management and workflow applications provide a superior file management interface. IT administrators will continue to "lock down" operating systems thereby limiting end-user's OS-related activities to those that can not interfere with the system's intended performance. IT administrators will increasingly management systems support remotely. When an organization can not control or predict what operating system an end user might have installed, the organization will need to consider adopting standards which have been implemented across many platforms. In short, organizations can count on most end users being able to support web based applications, and so we will see many more web based applications.

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3.

Refer to the Real World Case on Wolf Peak International in the chapter. If you were starting a small business, what business application software would you choose for accounting and control of business operations and management reporting? Why? Selection: Students should select between any OTS applications. QuickBooks is a well accepted solution that scales well from one-person operations to mid-sized organizations with hundreds of employees. Why? Managers should seek to strike a balance between functionality, cost, scalability, and flexibility. QuickBooks offers a low cost solution that can modestly scale up. Management can purchase additional functionality, and QuickBooks' immutable data structures greatly simplify migration to more sophisticated applications. Its most basic version is available for free download with the caveat that users are limited to entering no more than twenty customers. This limitation can be removed for $99. More sophisticated versions are available as well. Some students may base their selection upon familiarity with a specific package. This is a legitimate consideration as familiarity with a package helps increases certainty that the software fits well with the organization's needs. It also helps reduce the individual's learning curve and training costs. However, the choice must still be appropriate for a small business as well as allow for future growth, etc.

4.

Why is an operating system necessary? That is, why cant an end user just load an application program in a computer and start computing? In theory, it is possible to program applications that do not require an operating system. However, such a program would require instructions regarding how to operate the computer in addition to accomplishing the task at hand. It's far easier to install an operating that manages these tasks on the program's behalf so the application programmer can focus on solving application itself. This makes applications shorter, easier to understand, easier to use and allows multiple applications to run concurrently.

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Should a web browser be integrated into an operating system? Why or why not? Pro It's "free". It can provide more functionality than a browser that is not bundled (this is predicated on the theory that the OS isn't fully open). Con Courts have ruled that bundling a web browser with the operating system is anti-competitive when it is difficult or impossible to uninstall. Others would argue that it is anti-competitive even when it is not difficult to uninstall due to the "halo effect". 1

http://en.wikipedia.org/wiki/Halo_effect
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6.

Refer to the Real World Case on webtop software in the chapter. What are the business incentives that lure people to start a small company to develop and market webtop software applications? Would you invest in such a company today, or any other variation in that market space? Why or why not? Business incentives The basic business model for these sorts of applications runs: 1) develop cool software, 2) develop a strong and possibly viral user base, 3) and sell to major player like Google and Microsoft. The potential for a very large and relatively quick payoff is very attractive. Investing I would categorize this as a high risk investment. New graduates with minimal financial commitments might consider working for one of these start-ups in exchange for subsistence pay and stock shares. Regardless of the company's performance, the graduate would benefit from the experience.

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Are software suites, Web browsers, and groupware merging together? What are the implications for a business and its end users? The capabilities of these systems are merging together. The Internet, extranets, and intranets and the adoption of common formats are pushing technology towards tighter integration of these capabilities. Implications Implications include lower up front purchasing and long-term maintenance costs. End users will be able to more effectively collaborate. Increased productivity. Increased cross-functional productivity. Increased ability to partner and collaborate with business partners and customers.

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How are the HTML, XML, and Java affecting business applications on the Web? These common standards are enabling more sophisticated applications with larger user bases. Because these are standards accept across a wide variety of platforms, HTML and Java are becoming vital tools for building multimedia web pages, web sites, and web-based applications. Business can use HTML to create hypertext and hypermedia documents, creating hyperlinks to other parts of documents anywhere on the Web. Java is a simple and secure programming language. It is specifically designed for real-time, interactive, web-based network applications. It uses small programs which can reside on web sites or on a network server until needed by client systems. They are easy to distribute online; the casual user will be able to automatically download and run applets on an as-needed basis by using browser software. These capabilities result in webbased applications that have become increasingly more sophisticated, useful, and available. IT managers may feel more inclined to implement these applications rather than take the more traditional buy-and-install approach. Zimbra sells an interesting example of such a system. 2

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Do you think Linux will surpass, in adoption and use, other operating systems for network and Web servers? Why or why not? Organizations typically won't consider adopting a free-ware version of Linux due to security and support issues. However, organizations are increasingly purchasing commercial versions such as Red Hat Enterprise Linux for several reasons. Stability (very high mean-time between failures) Processing efficiency Bundled features Ongoing upgrades, maintenance, and support are available

http://www.zimbra.com/
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10. Which application software packages are the most important for a business end user to know how to use? Explain the reasons for your choices. In order of importance: Word processing allows users to express themselves effectively in writing formatted into professional looking documents with formatting to enable readers to easily find important information. Spreadsheets allows users to perform calculations and analysis on business data thereby enabling better decision making. Messaging (e-mail, instant messaging) provides users with a variety of means to communicate with other users without interrupting them with a telephone call. Communications and replies are selfdocumenting and serve as communications records available for future reference. Web browser provides users with a tremendous amount of information via access to the Internet, extranet, and intranets. Groupware enables basic collaboration activities calendar, schedule, task, and discussion (or "chat") capabilities. This allows people to work together more efficiently. Presentation graphics software to create professional-quality graphics presentations that can incorporate charts, sound, animation, photos, and video clips. This allows people to communicate complex ideas to a large audience. Desktop publishing software software that provides more control over the placement of text, graphics, and photos in the layout of a page than word processing software. This software allows users to creating a broader range of published materials than traditional word processing packages. Databases management systems allows users to quickly sort, filter, tabulate, and maintain large quantities of information on order to gain useful insights that might have otherwise remained hidden by the shear volume of data. Video editing enables true multi-media communications and presentations.

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VII. ANSWERS TO ANALYSIS EXERCISES


1. Desktop Application Recognition: Tool Selection a. Surf the Web and their intranets and extranets. Web browser b. Send messages to one another's computer workstations. E-Mail c. Help employees work together in teams. Groupware

d. Use a group of productivity packages that work together easily. Software Suites e. f. Help sales reps keep track of meetings and sales calls. Personal Information Management software Type correspondence and reports. Word processing software

g. Analyze rows and columns of sales figures. Spreadsheet software h. Develop a variety of graphical presentations. Graphics software package

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2.

Y2K Revisited: The End of Time This is our chance to learn from history. This is especially significant as this problem will manifest itself during our student's careers. a. If 1 represents 1 second and 2 represents 2 seconds, how many seconds can be represented in a binary number 32 bits long? Use a spreadsheet to show your calculations. 2^32 = 4,294,967,296 See Data Solutions Disk for a sample spreadsheet [Chapter 04 - Solutions.xls] b. Given that POSIX time starts at midnight, January 1st, 1970, in what year will time "run out?" Remember that half the available numbers represent dates before 1970. Use a spreadsheet to show your calculations. 2,147,483,648 seconds = 68+ years. 1970 + 68 = 2038. See Data Solutions Disk for a sample spreadsheet [Chapter 04 - Solutions.xls] c. As a business manager, what can you do to minimize this problem for your organization? Mitigation steps come directly from lessons learned from past experience. Do not trust your organization's IT department to manage this problem for you. Many IT departments are too busy solving today's problems. Tips: 1) Develop and maintain an inventory of all affected hardware and software systems upon which your organization depends. 2) Give priority to and establish funding for early mitigation efforts. 3) Require hardware and software vendors to identify affected systems and provide mitigation plans. 4) Require all vendors to certify that all new purchases are Y2038 compliant. 5) Start early!

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3.

Tracking Project Work a. Build a database table to store the data shown and enter the records as a set of sample data. See Data Solutions Disk for a sample database application [Chapter 04 - Solutions.mdb] b) Create a query that will list the hours worked for all workers who worked more than 40 hours during production week 20. See Data Solutions Disk for a sample database application [Chapter 04 - Solutions.mdb] c) Create a report grouped by project that will show the number of hours devoted to each task on the project and the subtotal number of hours devoted to each project as well as a grand total of all hours worked. See Data Solutions Disk for a sample database application [Chapter 04 - Solutions.mdb] d) Create a report grouped by employee that will show their hours worked on each task and total hours worked. The user should be able to select a production week and have data for just that week presented. See Data Solutions Disk for a sample database application [Chapter 04 - Solutions.mdb]

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4.

Matching Training to Software Use: 3-D Graphing a. Create a spreadsheet illustrating each application's average use per department. To do this, you will first enter the data shown below. Then compute the average weekly spreadsheet use by dividing spreadsheet hours by the number of Sales workers. Do this for each department. Repeat these three calculations for both database and presentation use. Round results to the nearest 1/100 th. Department Sales Operations Accounting Spreadsheet 1.82 9.47 10.33 Database 4.89 6.93 13.50 Presentations 2.89 5.40 1.67

b. Create a three dimensional bar graph illustrating the averages by department and software package.

Hours Per Week

14.00 12.00 10.00 Hours 8.00 6.00 4.00 2.00 0.00 Spreadsheet Database Presentations Accounting Operations Department Sales Sales Operations Accounting

Application

c.

A committee has been formed to plan software training classes at your company. Prepare a slide presentation with four slides illustrating your findings. The first slide should serve as an introduction to the data. The second slide should contain a copy of the original data table (without the averages). The third slide should contain a copy of the three dimensional bar graph from the previous answer. The fourth slide should contain your conclusions regarding key applications per department. Use professional labels, formatting, and backgrounds. See Analysis Exercise Data Solutions file [Chapter 04 - Solutions.ppt]

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IX. ANSWERS TO REAL WORLD CASES


RWC 1: Wolf Peak International: Failure and Success in Application Software for the Small-to-Medium Enterprise Case Study Questions 1. What problems occurred when Wolf Peak upgraded from QuickBooks to a new accounting software package? How could those problems have been avoided? Problems No data conversion capability for QuickBooks Excessive implementation time Poor user interface Inflexible reporting Batch processed (information not immediately available) Problem avoidance Many of these problems could have been avoided if a CFO had been brought on first. The CFO could have helped develop specifications for the new software. Typically, software specifications will require data conversions and easy to use interfaces as well as make specific report requests. The software originally chosen would never have satisfied these requirements and would not have been selected. 2. Why did SAP's Business One prove to be a better choice for Wolf Peak's management than the new accounting software? Give several examples to illustrate your answer. 3. SAP's software enabled significantly more flexible reporting. SAP's business partners had no difficulty migrating QuickBooks data. In all likelihood, they'd migrated QuickBooks data into SAP's systems many times before. SAP's software consists of a large integrated suite. Customers may purchase modules (group of related applications) as needed. This allowed Wolf Peak to add inventory management functionality when the time was right for them. SAP's software had an easy to learn and user interface.

Should most SMEs use an integrated business software suite like SAP Business One instead of specialized accounting and other business software packages? Why or why not? Yes, most SMEs should use off-the-shelf (OTS) integrated business software. A few organizations may have needs so unique that OTS software simply can't support them, but they will comprise a minority. Small businesses need to focus on satisfying their customers and growing their business. Customized systems would serve as a significant distraction from these important activities. They may also hinder the business from migrating to more robust systems. Consultants will have much more experience with migrations from major suites than they will have in migrating from little known or customized solutions.

Real World Activities 1. This case demonstrates failure and success in the software research, selection, and installation process, as well as some major differences among business application software packages in
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capabilities, such as ease of use and information access for employees and management. Search the Internet to find several more examples of such success and failure for software suites like SAP Business One or Oracle E-Business Suite and specialized business packages like QuickBooks or Great Plains Accounting. Not surprisingly, the software manufacturers post numerous success stories on their website. Even so, they do provide useful, brief illustrations. SAP Business One examples


2.

Sydney Essential Oil Company3 Success stories for Australia and New Zealand 4

Oracle E-Business Suite examples Cisco Systems5 List of success stories with links to details 6

QuickBooks List of success stories - multimedia 7

Great Plains Accounting (now called Microsoft Dynamics GP) Testimonials8

Break into small groups with your classmates to discuss several key differences you have found on the basis of your Internet research. Then make recommendations to the class for how these differences should shape the business application software selection decision for an SME. Issues include: Flexibility Scalability Integration with active directory for single log-in capability Available modules OS and database platforms supported Planned upgrades Differences in maintenance plans Quality of implementation partners Quality, type, and cost of support

http://www.sap.com/australia/solutions/smb/businessone/customersuccess/seoc.epx http://www.sap.com/australia/solutions/customersuccess/index.epx 5 http://www.oracle.com/customers/snapshots/cisco-systems.pdf 6 http://www.oracle.com/customers/products/ebsquotes.html 7 http://quickbooksenterprise.intuit.com/switch/success_stories.jhtml 8 http://www.microsoft.com/dynamics/gp/product/customerstories.mspx


3 4

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RWC 2: Google, Microsoft, and Others: Transforming the Desktop with Webtop Software Applications Case Study Questions 1. Do you agree that webtop software will one day replace suites of desktop applications? Why or why not? Check out the features of a few of the webtop products mentioned in the case on the Internet to support your answer. Webtop applications can replace desktop applications so long as network connectivity isn't an issue. People who work off-line will still require desktop applications. Arguments supporting webtop applications: Increased real-time collaboration Internet ubiquity Personal mobility (login from anywhere) Minimal footprint on the local machine Automated data backups (the data is already on the server) Usage tracking Facilitates document/knowledge management Rapid setup, simplified application maintenance Supports multiple operating systems Arguments supporting desktop applications: Lack of Internet access Data sensitivity, loss of personal control over data Avoiding duplicate development costs (web and desktop environments) Potential cross-browser support complications 2. Will Microsoft succeed in dominating the webtop? Why or why not? Visit the website of Windows Live and Office Live and review their products and services to support your answer. It's one thing to build a platform such as an operating system that supports the world's creative efforts, but it's a very different trick to build productivity tools. With productivity tools, only the files are dependant upon the tool, and tools to translate files from one format to another abound. As a result, switching costs between desktop or webtop applications isn't nearly as high as it is for switching operating systems. Furthermore, Microsoft faces an enormous challenge from the open source community. Many high quality free applications exist, and with open source development, these applications improve every year. In this case, it really will turn into a matter of Microsoft against the world. Given the success of Unix/Linux in the face of the complexities associated with operating system development, the far simpler desktop/webtop application competition should make even greater inroads. Windows Live 9 Windows live is an Internet search tool. It has an interface similar to Google's. Office Live 10 Office Live enables online collaboration by allowing users to store and manage documents online. Features include file storage, file access control, and a direct interface through Microsoft's Office applications. Microsoft offers an end user version and a small business version. 3. Should a small business invest its time and money in acquiring and learning how to use some of the webtop applications mentioned in this case? Defend your answer based on your review of the

10

http://www.live.com/ http://officelive.microsoft.com/
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webtop products from the small developers, Google, Yahoo, and Microsoft. Yes. Basic versions of these applications are free, and by exploring the functionality offered, small business managers may find products that fit their organization's needs. Since advanced versions may also be subscription based and hosted by the vendor, the small business owner need not invest in equipment, technical expertise, or expensive software. In short, these applications are low-cost, low-risk, and potentially valuable. Real World Activities 1. Research the websites of Google and Yahoo to find evidence of their entry into the webtop application software market. Evaluate several products you find, comparing them to the offerings of Microsoft and the independent software developers mentioned in the case. Products Google has a page listing its new and beta products. 11 The desktop is customizable with a click and drag interface. Yahoo's products are visible on its home page12. It also has a what's new tour. 13 The desktop is organized to feature its many applications in a logical arrangement. Microsoft MSN offers basic but fewer tools.14 The desktop has minimal customization features. 2. Try out demo versions of the internet of several of the webtop software applications mentioned in this case, including those that may be available from Google and Yahoo. Break into small groups with your classmates to discuss your reactions to the experience, and the features you would like to see changed or added that might lure you and others into acquiring one or more of these webtop products. The demo versions lack the polish of a desktop application, but they have also shown tremendous improvement over the last two years. The volume of advertising thrown at Yahoo's users seems excessive. Google incorporates a fair bit of advertising, but it isn't as distracting. Google also has a huge number of tools available for the user to add to their webtop. MSN's page is crowded, lacks features, and isn't as intuitive as Yahoo's.

http://www.google.com/intl/en/options/ http://www.yahoo.com/ 13 http://www.yahoo.com/newyahoo 14 http://www.msn.com/


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RWC 3: Microsoft and Others: Developing Software for How Companies Do Business Case Study Questions 1. A common phrase among IT professionals is The world views its data through Windows. Why does Microsoft dominate the desktop and networked software market? Visit its website at www.microsoft.com and review its broad range of software products and services to help with your answer. Possible reasons could include: A competitive advantage from being the first company to achieve massive acceptance of its operating system, which led into significant switching costs for the installed base Sheer magnitude of financial and technical resources available for ongoing marketing and development Aggressive marketing tactics designed to forestall or absorb the competition All in all, its products are easy to use and increasingly stable and efficient 2. How successful will Microsoft be in competing with software vendors that specialize in specific marketing applications like health care, retail, and other specialty services? Why? Although it has not always been the case, Microsofts size and resources give it an advantage when entering a new market. Its large customer base ensures that it will be given consideration as a possible alternative for new system development. It could be argued that, as long as there are economies of scale to be reaped in certain industries (i.e. applications can be industry rather than company-specific), Microsoft should be able to gain entrance to those markets. Development of the necessary knowledge or skills could be done in-house, through partnerships with a specialized vendor, or through outright acquisition of a smaller competitor. 3. Do you agree with Microsofts strategy to develop industry-specific partners to capitalize on opportunities in both large and small business sectors? Is there an advantage or disadvantage to being one of Microsofts partners in this type of relationship? Explain. By developing partnerships, Microsoft need not make the start-up investment or take risks itself, nor will it muddy its name in event of failure in a marketplace. Instead, Microsoft can for numerous partnerships and maintain its relationship only with those who prove successful over time. Advantages Partner's benefits include association with a major player, instant credibility, access to Microsoft product resources, and access to new customers. If the partner succeeds, Microsoft might offer to buy them out. Disadvantages First, partners would experience an unequal distribution of power. All arrangements would be made on Microsoft's terms. In addition, Microsoft might use the partnership to obtain knowledge and then enter the market itself as a competitor.

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Real World Activities 1. Industry-specific software applications are everywhere. However, many industries still lack a wide variety of software applications to support their needs. Using the Internet, see if you can find one example of an industry that has a wide variety of vertical applications and one industry that does not have a variety of software solutions from which to choose. Assume this question refers to off-the-shelf software. Supported These industries will share several characteristics in common. For example, they will feature a large number of competitors who have adopted similar business processes. Such an industry would include retail stores. Common business processes include inventory control, payroll, point-of-sales systems, etc. Unsupported Unsupported industries form nearly the mirror image. They will have relatively few competitors and their vertical systems will form a core part of their competitive strategy. The airlines make a good example. The software necessary to meet federal regulations, supply airplanes, and manage passengers and their frequent flier miles is simply too complex, too unique, too strategically focused, and exist in too limited a market to permit off the shelf sales. 2. Using the industries that lack a wide variety of support applications, break into small groups with your classmates, and discuss what types of applications would be valuable to those industries. Why do you think the applications you came up with have not been developed? Lack of sufficient market or customization demands should prevent these applications from achieving commercial development. Strategic leadership-oriented organizations will simply develop their own applications.

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