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Development of information system must be considered as capital investment: The developer of an information system must think about different solutions of a particular problem and each solution must be evaluated for risk management and cost-effectiveness. Cost-effectiveness is defined as the result attained by striking a balance between cost of developing and operating an information system and benefits derived from that system. Risk management is stated as the process of identifying and evaluating as well as controlling what might go wrong in a project before it turns out to be a threat to successful completion of project or implementation of information system.
Multiple feasibility checkpoints must be built into system development methodology. At every feasibility checkpoint, all costs are considered sunk (which means not recoverable). So the project must be re- evaluated at every checkpoint to determine if it remains feasible to continue investing effort, time and resources. At every checkpoint, developers must consider the below options:
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