1. The Systems Proposal
What the book calls the “Updated Baseline Project Plan” - no standard name for it
Presents the different options to the customer along with all the information they will need to make a decision
Deliverable 3 - must present at least three significantly different alternatives, one of which is the recommended solution

2. The Systems Proposal (cont.)
Introduction
Project Overview - updated, summarized version of the organizational description, the problem statement, and the scope statement
Recommendation - brief description of the recommended solution and why it is more feasible than the alternatives (summary of feasibility analysis)

3. The Systems Proposal (cont.)
System Description
Major requirements and constraints - a prioritized list of 6-10 high-level requirements and constraints (distinguish between the two) that will be used as a basis of comparison among alternatives
Brief technical descriptions of the three alternatives
Proposed DFDs for all three alternatives
Comparison of alternatives in terms of requirements and constraints

4. The Systems Proposal (cont.)
Feasibility assessment
Address each of the six types of feasibility for each alternative solution
For some feasibility types, the analysis may be the same for all three alternatives
Some analyses may be repeated from Deliverable 1
Economic feasibility analysis must be much more detailed than in Deliverable 1

5. Generating Alternatives
Must have three significantly different alternative solutions
All 3 must involve some change from the current situation
Consider:
non-technical solutions
partial solutions
low-end and high-end solutions

6. Requirements Document
An idea from software engineering
Another way to structure requirements
A statement specifying what a proposed system is required to do
Often structured as a list of numbered requirements, in textual form
Details the what, not the how

7. Requirements Documents (cont.)
What makes a good requirements document?
completeness
consistency
clarity
correctness
level of detail
testability
understandability

8. Purposes Contract between system vendor and customer
Communication with customer
Starting point for design
Guide for testing
Comparing alternatives

9. Types of requirements Functional Requirements Data Requirements
Look and Feel requirements
Usability requirements
Performance Requirements
Operational requirements
Maintainability requirements
Security requirements

10. Examples of requirements
Functional requirements:
When a customer applies for a video rental card by providing customer information and a means of verifying their identity, the system issues a video rental card.
When a customer rents videos by providing their video rental card and the videocassettes they are renting, the system calculates the amount due from the customer (including late fees), record receipt of the amount, print a customer receipt, and make a record of each item rented.
When a customer returns a video, the system records the return and notes any late fees on the customer record.
If a customer returns a movie 1-5 days late, the late charge is equal to an additional rental for each day it is late.
If the customer has outstanding late fees, they are not permitted to rent another video until the late fees are paid.

11. Examples of requirements
Data requirements:
The information maintained about customers includes customer id number, customer last name, address, telephone number, major credit card number and expiration date, and information on outstanding late fees
The information maintained about videos includes a video id number, title, year, class (which determines rental rate) and copy number
The information maintained about rentals includes the customer id, the video id, the date rented, the date returned, and the amount charged

12. Examples of requirements
Look and Feel requirements:
The user interface must conform to the conventions of the Microsoft Office products interface.
The XYZ company logo must appear in the upper right corner of each screen.
The fonts used on all printed output must be at least 14 points.
The color purple must not be used in any screen output.

13. Examples of requirements
Usability requirements:
User training for video store clerks must not exceed 30 minutes.
User training for video store managers must not exceed 2 hours.
Error rates among trained users must not exceed 1 data entry error in 4 hours.
On-line help must be provided and must be able to answer any questions a user has during use after training.

14. Examples of requirements
Performance requirements:
Average time to complete a customer application process must not exceed 10 minutes.
Average time to complete a video rental transaction must not exceed 3 minutes.
The system must be able to handle at least 2000 customers, 5000 video rental items, and 300 video rentals per day with no noticeable degradation in performance.

15. Examples of requirements
Operational requirements:
The system must run using PC-compatible hardware running the Windows 95 operating system.
The system must successfully network up to 8 PC’s with full data-sharing capabilities.

16. Examples of requirements
Maintainability requirements:
A trained video store manager, with no additional training or background, must be able to change the rental rates used for different classes of videos.
An enhancement to the system to allow it to handle more than one type of rental item (e.g. DVD) should cost (in terms of both time and money) no more than 10% of the original system development cost.

17. Examples of requirements
Security requirements:
The system must be password protected, allowing only video store employees to access any part of the system, and only managers to modify video information.

18. Assessing Feasibility
Technical – is technology available or are we able to develop it?
Economic – do we have the time and money?
Operational - will it work?
Schedule – can it be done in the given time?
Legal and contractual - are we allowed to do this?
Political – is anyone trying to undermine this project?

19. Operational Feasibility
Will it work with current systems?
Will it be accepted by users?
Will it solve real problems?

20. Work Breakdown - level 1 Analysis Information Gathering
Data, Logic, and Process Modeling
Systems Proposal Preparation
Design
Data Entry Design
Screen and Report Design
Data Organization
Process Design
Implementation
Integration
Testing

21. Work Breakdown - level 2 Information Gathering Conduct Interviews
Administer Questionnaires
Introduce Prototype
Observe Reactions to Prototype
Data, Logic, and Process Modeling
Data Modeling
Logic Modeling
Process Modeling
Systems Proposal Preparation
Perform Cost/Benefit Analysis
Prepare Proposal
Present Proposal

22. Work Breakdown - level 3 Days Detailed Activity Required
Choose interviewees 1
Develop interview guide 2
Schedule interviews 3
Conduct interviews 10
Transcribe notes 5
Conduct Interviews
Design questionnaire 5
Review questionnaire 5
Distribute questionnaire 1
Wait for responses 10
Compile responses 5
Administer Questionnaires
Build prototype 5
Install prototype 2
Introduce Prototype
Observe prototype use 5
Summarize recommendations 2
Observe Reactions to Prototype

23. Gantt Chart Activity Choose interviewees Develop interview guide
Schedule interviews
Conduct interviews
Transcribe notes
Design questionnaire
Review questionnaire
Distribute questionnaire
Wait for responses
Compile responses
Build prototype
Install prototype
Observe prototype use
Summarize recommendations 40 5 10 15 20 25 30 35
Days

24. PERT Chart

25. Critical Path
The shortest possible amount of time in which a project can be completed
Represented by the longest path on a PERT chart
If any activity along the critical path is delayed, then the entire project is delayed.

26. PERT Chart Choose Schedule Interviewees Interviews A 1 C 3 Develop
Conduct
Interview Guide
Interviews
Transcribe Notes B 2 D 10 E 5
Design
Questionnaire F 5
Build Prototype
Review
Questionnaire K 5 G 5
Distribute
Install Prototype
Questionnaire L 2 H 1
Observe
Prototype Use
Wait for
Compile M 5
Responses
Responses
Summarize I 10 J 5
Recommendations N 2

27. Economic Feasibility Analysis
For each alternative:
identify tangible, intangible, one-time and recurring costs and benefits
present and explain estimates for all tangible costs and benefits
use risk reduction and present value calculations if appropriate
compare costs and benefits using break-even analysis

28. Cost/Benefit Analysis
Risk reduction
use when one of the major benefits of the new system is to reduce the chance of some risk event or to reduce the loss from such an event
Cash-flow analysis
use when justifying a large up-front cost that will be paid out of operating funds
Present value
use when considering long-term costs and/or benefits
Break-even analysis
use when there are significant tangible benefits expected from the new system

29. Quantifying Risk Reduction
Risk reduction is often hard to quantify
Customer needs to know how much they’re paying for risk reduction
Can use the concept of utility loss to quantify the concept
Utility loss is the product of:
the probability of the risk event occurring
the cost to the organization of the risk event occurring

30. Quantifying Risk Reduction Example
Suppose:
The major benefit of the new system is that it reduces the risk from some event (e.g. a lawsuit) occurring
If this event happens, it will cost the organization about $2,000,000 (this is an estimate)
The probability that this event will occur is currently 5%, reduced to 1% with the new system (another estimate)
Compare utility losses:
Currently: (.05)*($2,000,000) = $100,000
New system: (.01)*($2,000,000) = $20,000
Savings: $80,000

31. Time Value of Money
Basic idea: the value of a dollar cost (or benefit) depends on when that dollar is spent (or received)
After calculating the dollar amounts of all tangible costs and benefits for each year, you must adjust the totals to calculate the NPV (net present value) of each year’s costs and benefits

32. Net Present Value (NPV)
To calculate NPV, need:
total tangible costs and total tangible benefits for each year
discount rate
Calculate PV for costs and for benefits for each year
Add up PVs to get NPV of costs and NPV of benefits
Overall NPV = (NPV of benefits) - (NPV of costs)

33. Break-even Scenario Suppose:
initial tangible costs, including new equipment, analysis, development, and training, are estimated to be $75,000.
Recurring operational costs, including system maintenance and training for new users, is estimated at $5000 per year.
Tangible benefits, in the form of decreased costs, are estimated to be $25,000 per year.

34. Break-even Scenario (cont.)
Benefits
100,000
Costs $
75,000
50,000
25,000
Break-even point 1 2 3 4
Years