Feasibility Analysis, Whitten Ch. 9

8/12/2019 Feasibility Analysis, Whitten Ch. 9

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FeasibilityAnalysis

Martha Grabowski

LeMoyne College


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Whitten, Bentley & Dittman 2001,

Chapter 93/18/2014 2

Measure of how beneficial or practical thedevelopment of an information systemwill be to an organization.

Feasibility AnalysisProcess by which feasibi l i ty is measu red

Cont inu ing p rocess of feasibi l i ty

assessment

Feasibility


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Chapter 93/18/2014 3

Operational FeasibilityTechnical FeasibilitySchedule Feasibility

Economic Feasibility

Tests of Feasibil i ty


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Chapter 93/18/2014 4

Operational FeasibilityHow wel l wi l l the solut ion wo rk in the

organizat ion?Technical FeasibilityHow p ract ical is the technical solut ion?

How available are techn ical resources and

expert ise?



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Chapter 93/18/2014 5

Schedule FeasibilityHow reasonable is the project t imetable?

Economic FeasibilityHow cost-ef fect ive is the project or

so lu t ion?

Cos t-benef i t analysis



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Chapter 93/18/2014 6

Quest ions to AskIs the prob lem wo rth solv ing?

Will the solut ion to the problem work?

How do end users and management feel

about the solut ion?

Has a usabi l i ty analys is been conducted?

Operational Feasibi l i ty


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Chapter 93/18/2014 7

Quest ions to AskIs the proposed solu t ion pract ical?

Do we possess the necessary technology?

Do we possess the necessary technical

expert ise?

Is the schedu le reasonable?

Technical Feasibi l i ty


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Chapter 93/18/2014 8

Cos t-benefi t analysesHow much wi l l the system cost?

Development cos ts

Operat ion co sts

Maintenance and support cos ts

Do we possess the necessary technology?

Do we possess the necessary technical

expert ise?

Is the schedule reasonable?

Economic Feasibi l i ty


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Chapter 93/18/2014 9

Cost AnalysisProject Budget Template

Author's Name Organization Name, Date

Assumptions

Personnel/Infrastructure assumptions

Infra structure assumptions

--Initial network and remote access upgrades covered in ZYX project

Programmatic assumptions

--Budget currently contains expenses only

--Revenues to be estimated upon completion of market survey

Worksheet and expense assumptions

--Average manager salary (2002$$) $75,000

--Annual expense increase 3%

--Benefits and indirect costs changes per year 0%

--Benefits (as a percentage of wages) 32%

Expenses Year 1 Year 2 Year 3 Year 4 Year 5

Personnel

Benefits (at 32%)

Hardware

Software

Computer Usage Costs

Training Costs

Library Resources

Program Maintenance and Upgrade Costs

Travel Costs

Administrative Costs

Administration

Postage, Fedex

Communications

Publication costs

Total Administrative Costs

Total Direct Cost

Indirect Costs (at 54.5%)

Yearly Project Costs


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Chapter 93/18/2014 10

Benef it analyses

Tang ible benefitscan be easi ly quant i f ied.

Measured in terms o f month ly or annual

savings , or o f prof i t to organizat ion

Intang ible benef i ts more di ff icul t to

quant i fy .

Benefit Analysis


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Chapter 93/18/2014 11

Benefit Analysis

Tangible BenefitsFewer processing errors

Increased throughput

Decreased response time

Elimination of job steps

Increased salesReduced credit losses

Reduced expenses

Intangible BenefitsImproved customer goodwill

Improved employee morale

Better service to community

Better decision-making


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Chapter 93/18/2014 12

Payback analys isHow long wi l l it take to recoup the costs o f

th is pro ject?

Return on investment (ROI) analysis

Net p resent value analysis

Economic Feasibi l i ty


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Chapter 93/18/2014 13

Compare candidate systems on basis ofseveral characterist ics

Better analysts always consider mult ip le

so lu t ions

Feasibi l i ty Analysis


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Chapter 93/18/2014 14

Candidate Systems Matr ixCandidate S ystems Matrix 10.13.01

Characteristics Candidate 1 Candidate 2 Candidate 3

Portion of System Computerize d

Brief description of portion of COTS package system that would be computerized Platinum Plus

in this candidate. from Entertainment

Solutions, Inc.

Benefits

B rief des cript ion of bus ines s benefit s S olut ion c an be

that would be realized for this implemented

candidate quickly.

Servers and Workstations

Description of the servers and PIV, MS Windows

workst ations needed to s upport this 2000 c las s s ervers

candidate. and workstations

Software Tools Needed

Software tools needed to design and MS Visual C++ build the candidate solution (e.g., MS Access for

DBMS, operating syst ems, customization

languages) of package for

report writing.

Application Software

Description of software to be built, Package solution

purchased, accessed or some

combination of the above.

Method of Data Processing

On-l ine , batch, defer red batch, rea l-t ime Cl ient -server

Output Devices and Implications

Output devices that would be used (e.g., HP4MV dept

network , preprinted forms, etc. ) as well l aser printers as output considerations (timing constraints)

Input Devices and Implications

Description of input methods to be used keyboard & mouse

(e.g., keyboard, mouse, etc.), special

input requirements (new or revised forms),

input considerations (timing of actual inputs)

Storage Devices and Implications

Description of what data would be stored, MS SQL DBMS

what data would be accessed from existing with 100G arrayed

stores, what storage media would be used, capabil ity

how much storage capacity needed, how

that data would be organized.


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Chapter 93/18/2014 15

Feasibi l i ty Analysis Matr ixFeasibility Analysis 10.13.01

Feasibility Criteria Weight Candidate 1 Candidate 2 Candidate 3

Operational Feasibility 30%

Functionality: To what degree does the Only supports Fully supports Same as

candidate solution benefit the organization? Members Services required Candidate

Political: How well will the solution be requirements and functionality #2

received by users? Management? current business

processes would

have to be modified

Score: 60 Score: 100 Score: 100

Technical Feasibility 30%

Technology:Assessment of maturity, Current release of Current technical availability, ability to acquire, and Platinum Plus is staff only has

desirabili ty of computer technology needed 1.0; only on market Powerbuilder

to support the candidate. 6 weeks experience.

Expertise:Assessment of the technical Staff thinks Access

expertise needed to develop, operate, app is simple.

and maintain the candidate system Score: 50 Score: 95 Score: 60

Economic Feasibility 30%

Cost to Develop $350,000 $418,040 $400,000

Payback period (discounted) 4.5 years 3.5 years 3.3 yearsNet Present Value $210,000 $306,748 $325,500

Detailed Calculations See attachment A ee Attachment A See Attachment A


Schedule Feasibility 10%

Assessment of how long the solution will Less than 3 months 9-12 months 9 months

take to design and implement.


Ranking 60.5 92 83.5

Documents

Feasibility Analysis, Whitten Ch. 9