4.6. Obtaining Software

Software can be obtained in a number of different ways. It can be developed internally which is referred to as proprietary software, or it can be purchased off-the-shelf, also referred to as packaged software.  Proprietary software is developed for a specific problem and is owned by the company. If the company does not have the resources within, they may contract another company to build the software for them. Off-the-shelf software is software that is readily available and already developed, such as Microsoft Windows or the Office Suite.

Proprietary Software Off-the-shelf Software
Advantages  Disadvantages Advantages Disadvantages
Get exactly what you need and want.

Control over the process.


Significant investment (time and money)

Need to provide ongoing support and maintenance.

Initial cost is lower.

Usually will meet the basic needs of the organization, and may have the ability to customize.

Support and training available.

Might pay for features that are not needed or wanted.

Software may lack required features and customization can be costly.

Software Creation

Software is created via programming, which is the process of creating a set of logical instructions for a digital device to follow. The process of programming is sometimes called “coding” because the developer takes the design and encodes it into a programming language which then runs on the computer. Modern software applications are written using a programming language such as Java, Visual C, C++, Python, etc. A programming language consists of a set of commands and syntax that can be organized logically to execute specific functions. Using this language a programmer writes a program (known as source code) that can then be compiled into machine-readable form, the ones and zeroes necessary to be executed by the CPU. Languages such as HTML and Javascript are used to develop web pages.

Software programming was originally an individual process, with each programmer working on an entire program, or several programmers each working on a portion of a larger program. However, newer methods of software development include a more collaborative approach, with teams of programmers working on code together. When the personal computer was first released, it did not serve any practical need. Early computers were difficult to program and required great attention to detail. However, many personal-computer enthusiasts immediately banded together to build applications and solve problems. These computer enthusiasts were happy to share any programs they built and solutions to problems they found; this collaboration enabled them to innovate and fix problems quickly.

As software began to become a business, however, this idea of sharing everything fell out of favor, at least with some. When a software program takes hundreds of man-hours to develop, it is understandable that the programmers do not want to just give it away. This led to a new business model of restrictive software licensing, which required payment for software, a model that is still dominant today. This model is sometimes referred to as closed source, as the source code is not made available to others.

Software Ownership

When you purchase software and install it on your computer, are you the owner of that software? Technically, you are not. When you install software, you are actually just being given a license to use it. When you first install a package, you are asked to agree to the terms of service or the license agreement. In that agreement, you will find that your rights to use the software are limited. For example, in the terms of the Microsoft Office software license, you will find the following statement: “This software is licensed, not sold. This agreement only gives you some rights to use the features included in the software edition you licensed.”[1]

For the most part, these restrictions are what you would expect. You cannot make illegal copies of the software and you may not use it to do anything illegal. However, there are other, more unexpected terms in these software agreements. For example, many software agreements ask you to agree to a limit on liability. This means if a problem with the software causes harm to your business, you cannot hold Microsoft or the supplier responsible for damages.


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Information Systems for Business and Beyond by Shauna Roch; James Fowler; Barbara Smith; and David Bourgeois is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.

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