Top Down Approach to system development assumes a high degree of top management involvement in the planning process and focuses on organizational goals, objectives and strategies. The organization goal drives the development of computer system. Using Top Down approach, we
begin by analysing organizational objectives and goals and end by specifying application programs and modules that need to be developed to support those goals.
Bottom Up approach to system development starts from the identification of life stream systems. Life stream systems are those systems, which are essential for the day to day business activities. Development of information system in Bottom Up approach starts after identifying their basic transactions, information file requirements and information processing programs. After ascertaining the data / information requirement, file requirements and processing programs for each life stream system the information system for each is developed.