Finerfoods, Inc., is a large, decentralized and diversified organization that primarily manufactures and sells grocery items. Various divisions of the company are widely dispersed geographically. In the past, divisions have been responsible for all aspects of their information systems operations.

Recently, top management has questioned whether it would be more efficient to have a centralized group of analysts and programmers develop and implement standard systems that could be distributed and used by all divisions within the company. The vice president of information systems, however, is strongly objecting to the proposed change. He argues the primary reason information systems in the company have been so successful is that they have been designed not only to accomplish task objectives but also to achieve a high quality of working life for users. He contends information systems departments in the divisions should be left to develop and implement their own systems as they are best able to develop systems that will support the organization and job design of their users. Top management is questioning whether the costs of having individual divisions develop their own systems, however, can be justified.

Required. The president asks you, the manager of internal audit for the company, to prepare a report outlining your thoughts on the costs and benefits of the proposed change. He asks you to give him your opinion on the validity of the arguments made by the vice president for information systems.