1. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 1 PROJECT INITIATION Chapter 2

2. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 2 Key Ideas Projects being when someone sees an opportunity to create business value from using information technology. Feasibility analysis is used to aid in the decision of whether or not to proceed with the IS project.

3. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 3 IDENTIFYING BUSINESS VALUE Projects that solve operational problems (Cost reduction) Projects that achieve the firm’s strategic objectives (New Markets/Products, Partnerships) Projects that exploit developments in technology (Product quality, New Products, Customer Service)

4. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. System Request Lists key elements of the project Project name Project sponsor Business need (Symptoms) Functionality (Objectives) Expected value Special issues or constraints (Scope)

5. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 5 Feasibility Analysis Detailing Expected Costs and Benefits Technical feasibility Economic feasibility Organizational feasibility

6. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Technical Feasibility: Can We Build It? Familiarity with application Knowledge of business domain Familiarity with technology Extension of existing firm technologies Project size Number of people, time, and features

7. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Economic Feasibility Should We Build It? Development costs Annual operational costs Annual benefits Intangible costs and benefit

8. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Cash Flow Method for Cost Benefit Analysis

9. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Total (benefits - costs) Return on Investment Calculation Total costs RETURN ON INVESTMENT EQUALS Divided by

10. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Net Present Value Calculation (1 + interest rate) n Some amount of money NET PRESENT VALUE EQUALS Divided by Where “n” equals the number of periods

11. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Organizational Feasibility If we build it, will they come? Stakeholder analysis considers Project champion(s) Organizational management System users

12. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 12 Summary Project initiation involves creating and assessing goals and expectations for a new system Identifying the business value of the new project is a key to success The system request describes an overview of the proposed system. The feasibility study is concerned with insuring that technical, economic, and organizational benefits outweigh costs and risks

13. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 13 The Case of a Pharmacy Problems faced by a pharmacy Poor Shelf Management  Perishable product  Inventory surprises (enough quantity not on shelf; expired drugs on shelf; problems managing expiry dates) Poor customer service  Drug interactions  Cheaper alternatives to prescription drugs

14. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 14 Systems Analysis Chapter 4

15. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 15 Key Definitions The As-Is system is the current system and may or may not be computerized The To-Be system is the new system that is based on updated requirements

16. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 16 Key Ideas The goal of the analysis phase is to truly understand the requirements of the new system and develop a system that addresses them -- or decide a new system isn’t needed. The line between systems analysis and systems design is very blurry.

17. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 17 THE ANALYSIS PROCESS

18. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 18 Combines business and information technology Balance expertise of users and analysts Analysis Across Areas

19. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 19 The SDLC Process

20. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 20 Proposal Outline Table of contents Executive summary System request Work plan Analysis strategy Recommended system Feasibility analysis Process model Data Model Appendices

21. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 21 Three Steps of the Analysis Phase Understanding the “As-Is” system Identifying improvement opportunities Developing the “To-Be” system concept

22. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 22 Three Fundamental Analysis Strategies Business Process Automation (BPA) Business Process Improvement (BPI) Business Process Reengineering (BPR)

23. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 23 Business Process Automation Goal: Efficiency for users

24. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 24 Root Cause Analysis Symptoms ROOT CAUSES Symptoms Identify symptoms Trace each back to its causes

25. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 25 Business Process Improvement Introducing evolutionary changes

26. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 26 Business Process Reengineering Radical redesign of business processes

27. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 27 DEVELOPING AN ANALYSIS PLAN

28. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 28 Developing an Analysis Strategy Potential business value Project cost Breadth of analysis Risk

29. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 29 Characteristics of Analysis Strategies BusinessBusinessBusiness ProcessProcessProcess AutomationImprovementReeingineering Potential BusinessLow-ModerateModerateHigh Value Project CostLowLow-ModerateHigh Breadth of AnalysisNarrowNarrow-ModerateVery Broad RiskLow-ModerateLow-ModerateVery High

30. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 30 Avoid Classic Analysis Mistakes Reduced analysis time Requirement gold-plating User over-specification of features Developer gold-plating Too many “cool” features Lack of user involvement

31. PowerPoint Presentation for Dennis, Wixom & Tegardem Systems Analysis and Design Copyright 2001 © John Wiley & Sons, Inc. All rights reserved. Slide 31 Summary The analysis process aims to create value for the organization Three main analysis strategies are BPA, BPI, and BPR These strategies vary in potential business value, but also in potential cost and risk