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Information from the CaseInformation from the Case
background of company business of company philosophy of company structure of company history of information projects history of MIS Group IMI project attitude towards the proposal justification method
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Open-Ended QuestionsOpen-Ended Questions
Would you approved the proposal if you were a member of the G14?
What would be the attitude of the four directors towards the proposal?
comments on
the justification process
the selection process of the software
the needs of Metalco on the proposed system
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General ApproachGeneral Approach
identify needs to change set up working group/task force define objectives and identify constraints identify alternatives, and for each one
determine costs and benefits, tangible or not perform sensitivity analysis
compare alternatives and select the best
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Identify AlternativesIdentify Alternatives
understand system requirements thoroughly hardware, software, existing technology
get help from experienced and experts take more options, include the do-nothing
option use simple, mature technology
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Determine Tangible CostsDetermine Tangible Costs
total cost in the planning horizon contingency factor from the bill-of-material of the system
basic components: hardware, software, labor, miscellaneous
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Software Cost EstimationSoftware Cost Estimation
whole system, including for system integration, data conversion, etc
estimation from in-house personnel request for proposal
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Labor Cost EstimationLabor Cost Estimation
read past headcount directly from the historical record
for future, estimate the volume and use the current productivity indicator
get advise from front-line supervisor calculate section by section, year by year,
direct and indirect
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Comparison of Tangible FactorsComparison of Tangible Factors
different aspects payback period time value of money internal rate of return depreciation
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Calculate SavingCalculate Saving
can easily calculate differences in quantifiable costs between current and proposed practices
compare tangible and intangible items
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Perform Supplemental AnalysisPerform Supplemental Analysis
sensitivity analysis to design for uncertainty
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