Abstract:
Many software development projects fail completely or partially because they do not deliver much business benefit, that is, the return on the investment in the software is either zero or not enough to justify the investment. Knowing the business value of a potential software investment up front is a real challenge. Multiple approaches have been proposed to increase the return on a software investment. However, they (1) don’t have a valuation model, but instead rely on external stakeholders to provide valuation estimations, (2) are inaccurate, (3) are not reusable from one case to another, (4) require a high level of effort, and (5) are inflexible to changes. To bridge this gap for the class of information systems that reduce the cost of the operations of a business process, developed in this dissertation is a Decision Guidance framework, called Opti-Soft+, to recommend a release schedule of software features that: (1) minimizes the combined cost of software development and improved business operations over the investment time horizon; and (2) outperforms the existing approaches. Opti-Soft+ is unique in that it (1) is based on an accurate formal modeling of the BSN in terms of net present value as a function of the BSN configuration, which is enabled by the synergetic effect of multiple interrelated software features; and (2) completelyeliminates manual, time-consuming and often inaccurate estimation of the BSN cost reduction. In order to develop the Opti-Soft+ framework, the contributions of this dissertation include: (1) a formal analytic model that accurately computes the Net Present Value of both the software development and the improved business process operation over the time horizon of the investment; (2) a decision guidance system and methodology that codifies the formal analytic model and its inputs, formulates an optimization problem, solves it, recommends an optimal release schedule of software features and guides a decision-maker through the steps to setup and run the system; (3) methods for sensitivity analysis; and 4) an evaluation through a case study.
