A market-based perspective on information systems development

I nformation systems development (ISD) is best understood as a market phenomenon, a perspective highlighting how software is developed and who performs that development and sells the related products and how they are introduced to users. Here I emphasize the increasing specialization of software producers (developers and vendors) as distinct from softwareconsuming organizations. I also contrast software product development with ISD, emphasizing my view of the worldwide software product market, exploring important implications for consumers. Worldwide software sales rose 280% from 1986 to 1995 [2] and are expected to double again by 2002, fueling market growth, along with the market capitalizations of Microsoft, Oracle, SAP, and other major vendors. Software comes as either packaged (commercial, or shrink-wrap) or made-to-order (custom, or one-off ). I distinguish between software producers (vendors of packaged software and software houses) developing, manufacturing, and distributing software and software-consuming organizations acquiring (buying) and using it. Software producers include such huge organizations as EDS, IBM, Lockheed-Martin, Microsoft, Oracle, SAP, as well as thousands of smaller firms. While a software consumer can be an individual or an organization, I focus on organization-level consumption. Thus, when Microsoft buys a license for, say, SAP R/3 products for managing financial operations and product inventories, it becomes a software consumer. Differentiating between producer and consumer points up that the boundaries between these roles are increasingly organizational in nature. An underlying assumption is that the changes in development are less dramatic than the changes in acquiring and installing software-based information systems [3, 4, 6]. I thus view these issues from the perspective of a software consumer to reveal how the software product market is changing ISD.