Application System

An application system is an integrated unit comprising hardware and software components, designed to address specific business challenges and tasks. These systems are critical for modern enterprises to manage operations effectively and ensure competitive advantages.

Definition and Components

An application system integrates the following elements:

1. Hardware Component: This includes computing hardware and other peripherals, like input/output devices.
2. Software Component: Divided into standard software and custom (individual) software, as categorized by Mertens et al. (2005).

Standard Software

Standard software products are mass-market solutions characterized by hardware independence, enabling self-installation routines on users’ hardware. Customization options for standard software are often limited, focusing on parameter settings, configurations, or interface development without modifying the core application code.

Subcategories of Standard Software:

• Basic Software: Offers fundamental functionalities, e.g., email communication and antivirus programs.
• Standard Office Software: Tools like word processing, spreadsheets, presentations, and web development applications.
• Function-Oriented Standard Software: Supports specific business functions or cross-functional processes. Enterprise Resource Planning (ERP) systems exemplify this category.
• Process-Oriented Application Software: Workflow management systems designed to streamline processes across organizational functions, as described by Picot et al. (1998).

Custom Software

Custom (individual) software is tailored to specific organizational needs, making it non-transferable to other use cases or locations. While highly adaptive, the high development costs often lead businesses to integrate elements of standard software for economic efficiency.

Application Systems in Business Operations

Stahlknecht and Hasenkamp (1999) categorize operational application systems as follows:

1. Administrative Systems: Automate routine processes, such as inventory tracking or time management.
2. Disposition Systems: Aid in decision-making, like optimizing production schedules or workforce planning.

For managerial use, planning and control systems provide insights:

• Planning Systems: Enable long-term strategic planning by analyzing historical data and forecasting.
• Control Systems: Monitor operational activities against predefined targets and highlight deviations, prompting corrective actions.

Development and Implementation of Application Systems

Developing application systems involves defining business and organizational requirements and translating them into executable solutions. Two approaches dominate system development:

1. Phase-Oriented Development: A structured, step-by-step process comprising:
   • Planning: Outlining project goals and feasibility studies.
   • Definition: Documenting user requirements and creating specifications.
   • Design: Developing functional and technical models, user interfaces, and system architecture.
   • Implementation: Coding, system integration, and testing.
   • Acceptance and Deployment: Verifying compliance with user requirements and operational readiness.
   • Maintenance: Continuous updates to address errors or evolving user needs.
2. Prototyping: Iterative testing of system prototypes to refine functionalities and user experience.

Combining these methods leverages their respective strengths, ensuring robust development outcomes.

Standard Software Implementation

For organizations opting for standard software, Mertens et al. (2005) outline three phases:

1. Selection Phase: Identifying suitable software and modules based on mandatory and optional criteria.
2. Implementation Phase: Includes installation, customization, data integration, and rigorous testing to ensure alignment with business requirements.
3. Operational Phase: Launching the system, training employees, and ongoing maintenance.

Enterprise-wide software, such as ERP systems, often necessitates process reengineering to align workflows with software capabilities. Though implementation excludes custom programming, project durations and associated costs (mainly personnel expenses) can be significant.

Application Systems in Human Resource Management

HR functions extensively utilize application systems for tasks like recruitment, payroll, and employee performance management. These systems are tailored to address unique challenges in personnel management and enhance decision-making efficiency.

Source:
Netsuite