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Acknowledgment

First and foremost, the group of system analysts would like to express the deepest
gratitude to Mr. Harvey T. Ong, professor from the Decision Science and Innovation Department
of De La Salle University, Manila for his unwavering dedication to teach and to guide his
students all throughout the term in order to accomplish this project. Without him, this IS Plan
would not be achieved.

Second, the group wants acknowledge De La Salle University Manila for providing its
students great facilities and resources such as the library, the classrooms, the books and the
computers. These resources have greatly helped the group in their study and project making
proper.

The group would also like to show appreciation to Chevrolet North EDSA, specifically
Mr. William Tan, Mr. Vincent Licup, Mr. Eddie Uy and all the employees of the company for
their willingness to participate and to cooperate in the making of this project. The group owes
them for all the information, time and effort the company gave to assist the group in their needs.

Lastly, the group would like to offer this project to God, their families and their friends
for the never ending support and love especially during the toughest times in the duration of the
project making.

Executive Summary
1

The study was conducted to improve the system of Chevrolet North EDSA. The company
is a car dealership company and engages in the sale of cars, sale of parts and accessories, and
provides service and repairs. The system analysts visited the company to conduct interviews and
to observe the business processes of the company. The system analysts also studied the
companys financial statements and documents to identify existing problems or problems the
company may face in the future. After careful analysis of the collected data, the system analysts
were able to identify three critical problems of the company; high turnover rate, ineffective
promotional strategies, and lack of coordination between departments.
To solve these problems, the system analysts proposed a system that could replace the
current system of the company. This means that the system analysts are aiming to offer the
company a better system that could provide the company with more efficient and more effective
performance. This system would mainly focus on the companys sales and after sales department,
finance department, human resource department and purchasing department. The proposed
system would automate the process of creating a payroll by taking advantage of a biometrics
scanner which would automatically record the attendance of the employees, the attendance
would then be used in computing the employee payroll. Another function of the system is to
automate the tracking of the companys inventories by providing databases such as for office
supplies and car parts. The system would also monitor all the databases for the entities of the
company, particularly for employees, suppliers and customers. Accounts Receivables and
Accounts Payables are also automatically updated when transaction is made through the system.
The generation of essential documents is also one of the capabilities of the proposed system. It
could produce receipts, invoices, and order lists for the use of the company, suppliers and
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customers. Finally, the process of prompting a purchase would be automatically done as a


database of purchased inventory would be kept to easily identify a need for purchase.
The functions of the proposed system are aimed to attain efficiency and avoid
unnecessary activities which consume time. The proposed system saves time in a number of
activities; manually checking the attendance, manually checking which cars and parts are
available for sale, and manually checking which supplies are running low. The proposed system
also aims to provide the company a user friendly system which the employees could easily
understand and manipulate because according to the management of Chevrolet North EDSA,
ERIC system is quite complicated to use especially for the new comers in the company. The
proposed system also wants to be of help in the company by providing services and high quality
performance required by the company, given a realistic and worthy amount of costs.
On the process of implementing the proposed system to the company, three alternatives
are laid out by the system analysts in order to provide the company options as to how they would
like to develop the proposed system. The first method is creating a new system by employing an
external team to create the system. The second is creating the same system but having the
companys own IT department create the system. Finally, the last method is purchasing COTS, a
readymade system, which would generally suit the companys operations.
After conducting a feasibility study and based on the graphs shown above, the system
analysts arrived with a decision to recommend the first choice of having the proposed system
created by an external team as it generally costs less than the other proposed system, given its
potential benefits for the company. Even if the company has its own IT department that is
capable of creating the proposed system, and even if the purchasing of COTS is the cheapest, the
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benefits offered by outsourcing the development of the new system is much more worthy
compared to the other two. This is because in outsourcing, the company would be able to get is
customized system that follows the companys objectives, which is basically the opposite of
COTS. And in outsourcing, the company is given the chance to focus more on their routinely
activities because they are not the ones maintaining the system. Lastly, outsourcing offers a
faster, more accurate and surer development of the system.
Provided below are graphs that presents the costs, benefits and period of development of
the system.

Figure Exec. 1 Development Costs

Figure Exec. 2 Development Periods

Figure Exec. 3 Benefits


Chapter 1 - Rationale and Scope of the Information System Strategic Plan

Innovations in technology are continuously growing today, especially that many people
are starting to engage and appreciate the benefits brought by the technologies. One of the most
evident benefits of technology to businesses is the fact that technologies make the work of
people easier, faster and more efficient.

Through the use of the available technologies,

businesses are able to get access to tons of information in the internet, produce more products
and services through machines, record data using computers, communicate to other entities by
the means of telephone, cell phone and/ or e-mail, and a whole lot more. Indeed, technologies
asisst the companies on how to find ways to have more efficient and effective means of meeting
the strategic goals of the business and attaining competitive edge against the other businesses in
the industry. Aside from these, technologies also help businesses improve its day-to-day business
processes by reducing errors, lessening costs and increasing productivity amongst its employees
and employers.
This study is limited only to the issues encountered by one company which is Chevrolet
North EDSA. The system analysts are to get into the exact business processes done within the
aforementioned company, so as to gain a wide range of information and a more profound
understanding of the problems faced by Chevrolet North EDSA. Currently, the companys
system per department varies such that many departments are fully- automated, some are semiautomated and only a number of processes are still done on a manual basis. The system of the
company also presents some eye catching problems such that some processes done by the
company like the promos are not yet integrated with the main system used by Chevrolet North
EDSA, which eventually leads to inefficient and incomplete data recording and inaccurate
results.

After the assessing the problems raised by the company, the system analysts designs a
new system for the company which could assist it in performing all of its processes. The
proposed IS plan would result to the elimination of errors, reduction of costs, improved
databases, accurate recordings, increased efficiency in employee works and more secured
system.
1.1 Scope
The IS Strategic Plan would encompass the following:

Companys goals and objectives, culture and background


Current system of the company
Budget Requirements of the proposed system
Main business processes of the company those are capable of full automation.
Human Resource: Payroll, Attendance and Employee Records
Purchasing: Purchase Order, Supplier Records, Purchasing Office Supplies,
Purchase Invoice and Car Parts
Sales & After Sales: Customer Records, Sales Order, Sales Invoice, Service and
Car
Finance: Accounts Payable, Accounts Receivable, Other Expenses and Payroll

1.2 Limitation
The following are not covered by the IS Strategic Plan:

Other brands under the management and ownership of Calebs View Automotive
Group, Inc.
The information that the company kept private
The most recent financial statements were not disclosed by the company.
Business processes of the company that would not be fully automated.
Human Resource: Recruitment, Selection and Training Processes
Marketing: Promotions and Advertising Processes
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Sales & After Sales: Repair of Vehicles, Personal Transactions with Customers
IT: Update and Maintenance of Systems

Chapter 2 Company Background


2.1

Brief History
Calebs View Automotive Group Inc. was incorporated in the year 2011 in the

partnership of Mr. Vincent S. Licup and Mr. William M. Tan.

Mr. Vincent Licup business includes retail electronics, toy distribution and also
holds interest 2 Foton car dealership. Mr. William Tans main business is wholesale
distribution of oil and lubricants, and has interests in shipping retail gas, liquefied
petroleum gas and real estate.

Calebs View Automotive Inc. was granted a franchise of Chevrolet dealership. In


the late 2012, Calebs View Automotive Inc. also opened a branch of Volvo in North Edsa.
The main office of Calebs View Automotive Inc. is in Chevrolet North Edsa which is
located in 1250 Epifanio Delos Santos Avenue, Barangay Apolonio Samson, Balintawak,
Quezon City. Calebs View Automotive Group Inc. can be contacted through their fax at
990-7910 or their landline: (02) 990-16-07; (02) 990-16-08; (02) 990-16-09; (02) 990-2499.

Main operations of Calebs View Automotive Inc. include selling of cars from
Chevrolet and Volvo and providing service and maintenance for automobiles. The
organizational structure of Calebs View Automotive Inc. is composed of the
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CEO/Chairman/Chief Financial Officer as the highest position, Controller, and subdivided


into two divisions namely the Operations Group and the Support Group.

Chevrolet North Edsa which is operated by Calebs View Automotive Inc. also
gained the Rookie of the Year Awards 2012.

2.2

Industry Update
Automobiles are now considered to be one of the essential things people must

own in order to carry out day- to- day tasks easier. With automobiles on hand, people are
able to go to different places in a less hassle and less complicated way. Even in the
transportation industry, automobiles are very important together with trains, airplanes,
ships, etc.

In the Philippines, increasing number of Filipinos have been acquiring

automobiles for both personal and business purposes due to the increasing purchasing
power of the consumers as a result from the developing economy of the country.

According to Bernie Magkilat (2013), there is an expected growth of 10 percent in


the sales of the domestic vehicle industry.

As a matter of fact, in the recent study conducted regarding the automobile


industry sales for the month of May, combined sales of Chamber of Automotive
Manufacturers of the Philippines, Inc. (CAMPI), the Truck Manufacturers Association
(TMA) and the Association of Vehicle Importers and Distributors, Inc. (AVID) has

resulted for automobile industry to gain a 23.5 percent growth for May, 2014 as
compared to the same month last year (Vince Pornelos, 2014).

Table 2.1: Sales of the Automobile Industry as of May, 2014

As shown in the table above, the total sales for May, 2014 reached 22, 815 units
which are significantly higher compared to the 18,475 units that were sold in May, 2013.
Toyota is still the number one player in the game, followed by Mitsubishi then Hyundai.
Chevrolet also is one of the leading firms in the industry which placed 8 th in the tally.
Overall, the Philippine automobile industry has sold 104, 264 units from January to May

of 2014 which is 21.4% higher compared to the 85,886 units of cars sold for 2013 (Vince
Pornelos, 2014).

Despite the growing prices of the vehicles and the unstoppable traffics
experiences in the Philippines, Filipino consumers are still on their plans of having their
own units someday. This means that the automobile industry will continue to rise up for
2014 and for the years to come.

2.3

Products / Services
The company offers all the cars that Chevrolet and Volvo manufactures. Some of

the cars that they offer can be bought by ordering from them, such as the Camaro of
Chevrolet.

The company offers maintenance and other services for Chevrolet, Volvo and all the
other different brands of cars. The following photos show all the services that CVAI offers
for each model of car:

10

For Trailblazer Cars:

Figure 2.1 Prices of the Services for Trailblazer

11

For Suburban Cars:

Figure 2.2 Prices of the Services for Suburban

12

For Sonic and Spark Cars:

Figure 2.3 Prices of the Services for Sonic and Spark Cars

13

For Malibu and Cruzes Cars:

Figure 2.4 Prices of the Services for Malibu and Cruzes Cars

14

For Colorado Cars:

Figure 2.5 Prices of the Services for Colorado Cars

15

For Orlando and Spin Cars:

Figure 2.6 Prices of the Services for Orlando and Spin Cars

16

This photo shows all the cars that Chevrolet North Edsa sells with the
corresponding price:

Figure 2.7: List and prices of the vehicles sold by Chevrolet North EDSA

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This photo shows all the cars that Volvo North Edsa sells with the corresponding price:

Figure 2.8: List and prices of the vehicles sold by Volvo North EDSA
2.4

Company Vision / Mission Statement


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Every company has its own vision and mission. Every company also has its core
values that the company uses as a guide to be able to provide the most efficient service to
its valued customers. Stated below are the vision and mission and core values of Calebs
View Automotive Group Inc.

Vision
To excel in our chosen field, car dealership and services, using Emphatic
Customer Satisfaction (ECS) as our number one creed.

Mission
To consistently win the Dealer of the Year Award by fully tapping our area of
responsibility (Northern QC) using Emphatic Customer Satisfaction (ECS) as our number
one creed.

Core Values
Flexibility- We believe in being flexible in dealing with different customers. We provide
different strokes to different folks.

Opportunity- We believe that every opportunity to serve is an opportunity to complete


the JAIDTs business cycle, thus, every customer can expect our best service.

Credibility- We believe that credibility is a commitment to honor our promises. That is


why we walk what we talk.
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Unity- We believe that the achievement of our organization is the result of the combined
quality effort of each individual.

Sincerity- We believe that in giving real service to customers, we must add something
which cannot be bought or measured with money, and that is sincerity.

2.5

Management and Culture


Chevrolet North EDSA has been in the industry for 3 years which means that it is

still a rookie when it comes to the industry. Despite being a newbie in the automobile
industry, Chevrolet North EDSA has already proven its strength and capabilities after
being awarded as the Rookie of the Year 2012. Chevrolet North EDSA is under the
management of Mr. Vincent Licup and Mr. William Tan who are also the owners of
Calebs View Automotive Group, Inc. The owners are very hands on to their operations
especially when it is related to sales.

The company follows a centralized form of organization which means that the
company has a hierarchical status which should be followed by the employees. The
decision making and planning are done by the top management. The company also
follows a strict vertical structure in which front line employees of Chevrolet North EDSA
should frequently report to the middle and top management the progress of the various
works in the company.

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Chevrolet North EDSA also provides quotas for its employees each month as to
how many units should be sold per sales agent. Rewards system is evident in the
company since those high-performing employees are handsomely rewarded for the efforts
to meet or double the expected quotas. In the company, the employees do different
techniques to inspire themselves in meeting the quota. Some post papers in the wall to
remind them of the progress of the sales, while the others go for team buildings to
motivate one another.

Trainings are also provided to the employees of Chevrolet North EDSA


particularly for those who are in the front line of the business or the sales agents. Some
training is provided for the purpose of learning the systems and other business processes
of the company.

Aside from the benefits garnered for meeting the desired quotas, other benefits are
also given to the employees like SSS, Philhealth and HDMF.

The employees of Chevrolet North EDSA are evidently kind, trustworthy,


efficient, effective and productive. The people are always busy working, but at the same
time, they are enjoying what they are doing. However, the turnover rate in Chevrolet
North EDSA is high that it comes to the point that in duration of two months, many
employees are laid off. No exact percentage was given, but this information came from
one of the top employees of the company.

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Despite being a centralized company, the strategy of Chevrolet North EDSA is to


be flexible when it comes to dealing with the customers. Customers needs and wants
should always be satisfied especially when aiming to garner increased sales. After all, the
companys vision is customer satisfaction.

2.6

Company Officer / Organizational Structure

Figure 2.9: Organizational Chart of Calebs View Automotive Group, Inc.

The organizational structure of Calebs View Automotive Group, Inc follows a


functional type because as Figure 2.9 presents, the division is based on the functional
groups or departments of the company. The above shown organization chart is followed by
both Chevrolet North EDSA and Volvo North EDSA.

2.7

Resources
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2.7.1 Physical
a. Computer and Server
These computers and servers are usually used by companies, not only Chevrolet
North EDSA, to record and store data. These function as a mean of documenting
transactions and creating forms such as sales order and sales invoice. The hardwares are
essential for the companys daily activities because every transaction is placed/ recorded
with the use of the computer. The server should always go with the computers because
computers can only function properly and well with the server present.

b. Printer
Printers are important hardwares in the company because these allow production
of hard copies of the document and records of the company.

c. Photocopying Machines
Photocopying machines are used to produce multiple copies of printed outputs.
These are commonly used for reproducing customer records, customer receipts, sales
invoce, sales order, etc.

d. Projector
Projector is used by the company during meeting and conferences. This is
functional for visual aids like PowerPoint presentations.

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e. Telephone
Telephones are necessities in the company when communicating with customers,
suppliers and other important entities in the environment of the company. The company
has direct lines, trunk lines and local/ extension lines.

Listed below is the hardware inventory of Chevrolet North EDSA:

Estimated Projected
Hardware

Qty

Computer

25

Type of Equipment

Location

age
Desktop 2

Intel

life
8 years

Computer
Intel
Server

25

Core

offices

(for employee users);


i5

3470

Owners office

3.2Ghz- Asus H61M- A


IBM System x3100 M4 2

6 years

Server
Xeon

Departmental

Departmental

offices

(for employee users);


4C

E31220v2

Owners office

80W
Printer

Intel C202
Epson M100

4 years

Departmental

Photocopying

RiCoH Imagio Neo 220 3

6 years

Owners office
Departmental offices

machines
Projector
Telephone

1
13

Infocus IN112
2
Panasonic
telephone 3

5 years
8 years

Owners office
Departmental offices;

unit with speaker phone


Hardware
Computer
Printer
Photocopy
Projector
Telephone

User KX-T7716
Employees; Top Management
Employees; Top Management
Employees; Top Management
Employees; Top Management
Employees;
Top
Management; Customers

Owners
Status
In operation
In operation
In operation
In operation
In operation

offices;

office,

Financial Customer
arrangement
Lounge
Owned
Owned
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Owned
Owned
Owned

Table 2.2 Hardware Inventory


2.7.2 Human
Chevrolet North EDSA has 35 employees. These 35 employees are divided into
the 6 departments of the company. Hiring process in Chevrolet North EDSA is crucial
and important. The Human Resource Department follows certain standards that
applicants should meet in order to be recruited and selected by the company. The
company also implements just employee treatment as prescribed by the rules and
regulations of the government. Equal rewards and wages are also given to the employees
based on their positions and performance in the company. Strategic planning is required
in order for Chevrolet North EDSA to be able to acquire the right set of workers to avoid
low productivity and skill obsolescence.

The first department is the Human Resource (HR) Department. This department
has 2 employees. The HR department handles the attendance and payroll processes of the
company. For the attendance, the company uses a time checker to monitor the attendance
of the employees. And using those cards, the HR personnel will manually input the data
in the MS Excel. As for the payroll, MS Excel is used by the company to compute for the
salaries.

The Information Technology (IT) Department has only 2 employees. The IT


department maintains and operates the systems of the company, which is the ERIC
System. The IT department makes use of ERIC System in order to maintain and update

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the needs of the system. This department is also vital in the planning of the developments
to be made in the system.

The Sales Department has 12 employees. It monitors and controls the inventory
and orders coming from the customers. As for the inventory, the department uses the
ERIC system to input the details from the sales order and automatically deducts the
number of units and supplies in the inventory. On the other hand, the orders from the
customers are manually done through personal transactions. Half of the employees of the
Sales Department are the agents who are personally talking and transacting with the
customers.

The After Sales Department has 11 employees. This department is assigned to the
functions of vehicle maintenance and repair, as well as the order from the suppliers. The
vehicle repair and maintenance part uses the ERIC system to gather information about the
customers. The services and products availed also in this part are entered to the system
for updates. Final reports on expenses incurred by the customers are also generated
through the system. However, the repairing of vehicles proper and the ordering from
suppliers of the parts and equipment needed by the vehicles are done manually.

The Marketing Department has 4 employees. The Marketing departments main


function is to promote and to advertise the products and services of Chevrolet North
EDSA. The department makes use of internet through the social networking sites such as
facebook to provide updates, promos, freebies, services and products. The department
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also maximizes the benefits of texting to encourage the customers to avail their products
and services.

The Finance Department has 4 employees. The Finance department handles the
accounts receivable and accounts payable of the company. They monitor the companys
finances particularly the sales and expenses. The department uses the ERIC system in
order to update their account databases and to generate the companys financial
statements.
2.7.3 Financial

The financial resources of the company come from the income earned by
Chevrolet North EDSA. The income that they earn is used by the company to suffice the
monetary requirements of their daily operations.

2.7.4 Informational

Chevrolet North EDSA is engaged research and development about the latest
trends and news about their products, the company and the industry. It is important for
Chevrolet North EDSA to continue researching about the field they are into, so that they
would be able to anticipate future demands and problems. Promotional techniques are
also one of the things the company is continuously researching about. Aside from
research and development, the company also collects data through their suppliers and
customers. The opinions, suggestions and comments of the external environment are very
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helpful for the company especially for their improvement and to increase customer
satisfaction. Internal environment is also important for Chevrolet North EDSA when
gathering information. The experiences and knowledge of the employees aid the
company into developing their systems and processes. E-mails, texts, surveys and
personal interviews are the common ways that the company uses when engaging with the
external and internal entities around them.
2.8

SWOT Analysis

a. Strengths
Chevrolet and Volvo are US-based car brand which assures the customers that the
cars that Calebs View Automotive Inc. is offering are in the best of the line. Chevrolet
also offers the Trailblazer, which is named as the SUV of the year in 2013.

Calebs View Automotives Inc. gets the materials it uses in its maintenance
services directly from the supplier of Chevrolet Philippines which means that their
materials are of high quality. The materials that they provide for the services they are
offering makes their service better than other service and maintenance shops around the
area, because customers can be assured of the quality of the service.

Calebs View Automotive Inc offers really good packages and promos from time
to time for their customers. They also require low down payments for the car purchased
by their customers. The company also offers 5-year warranty for parts and services for
their cars. This makes their customers more at ease in buying cars from their company.
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b. Weaknesses
Being a well known US-based car brand, Chevrolet is quite more expensive than
other car brands, especially those from Japan, such as Toyota and Mitsubishi. This also
makes it hard for Calebs View Automotive Inc. to retain their customers because the
materials that they offer for their service and maintenance shop are more expensive than
the other service and repair shops.
According to the company the automobiles they sell are not the primary cars that
customers choose to own. Due to higher value of their products, first time car owners
usually prefer brands such as Toyota and Mitsubishi.

c. Opportunities
Chevrolet North EDSA is the nearest Chevrolet branch for customers residing in
Quezon City, Bulacan and Anitipolo.
Chevrolet is currently manufacturing new car models that will cater to the Asian
market.
d. Threats
A new branch of Chevrolet in Baliuag, Bulacan opened recently which could be
the new target shop of customers living in Bulacan.
Other leading brands (e.g. Toyota, Mitsubishi, and Honda) are more prominent
therefore capturing a bigger portion of the automotive industry market.
The chart below is the summary of the SWOT of Calebs View Automotive Inc.

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STRENGTHS

WEAKNESSES

Chevrolet gets the materials it uses in its


maintenance services directly from the
supplier of Chevrolet Philippines.

The total price per unit of


Chevrolet cars is quite more
expensive than other car brands.

It offers low down payment rates to its


car units.

It is a US-based brand which could be an


assurance that Chevrolet is in the best of
the line.

Low customer retention since


some parts and services are more
expensive than other car repair
shops.

Cars acquired from Chevrolet


Philippines are not always in their
best condition.

Customers are widely spread.


(Customers choose to avail
services of other auto repair shops
nearer.)

The management and employees are


professionals.

Competent brand and products.

It offers good packages and promos for


every purchase of their units.

They offer 5-year warranty for parts and


services.

Chevrolet North EDSA is the nearest


Chevrolet branch for customers residing
in Quezon City, Bulacan and Anitipolo.

OPPORTUNITIES

Chevrolet is currently manufacturing new


car models that cater to the Asian market.

Increase in wages for year 2014


(economic opportunity).

THREATS

A new branch of Chevrolet in


Baliuag, Bulacan opened recently
which could be the new target shop
of customers living in Bulacan.

Other leading brands (e.g. Toyota,


Mitsubishi, and Honda) are more
prominent therefore capturing a
bigger portion of the automotive
industry market.

Table 2.3 Summary of SWOT Analysis

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Chapter 3 - IS Environmental Assessment


(Current / Existing Systems)
3.1

Existing System
After conducting a series of interview with the company, the system analysts

found out that Chevrolet North EDSA has six departments which cater to the needs of
the internal and external entities surrounding the company. The six departments
namely Human Resource, Marketing, Sales, After Sales, Finance and IT functions
differently from one another and uses various systems as well. The system used by
each department varies in terms of the need and system capability of the company.

For the Human Resource department, they use Microsoft Office particularly
Microsoft Excel to input their attendance and payroll records. The department is not
using the companys system because they are more comfortable with Excel as a mean
of computing the employees salaries and benefits as well as in tallying the attendance.
However, the department is open for new developments in their system if possible.

For the Marketing department, they make use of the internet as a method to
perform their job requirements specifically for company promotions and
advertisements. The department utilizes the Facebook pages to send messages and
status about Chevrolet North EDSAs update, promos, and freebies to its followers and
customers. The department also uses MS Excel to keep track of the progress of their
promotional and advertising techniques.

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The Sales Department uses the companys system called ERIC. The use of
ERIC system to the Sales department is in regard to inventory and order from
customers. Through the ERIC system, the department finds convenience in recording
and monitoring the sales and inventory of the company. The employees under the
department just input the necessary data in the system and then relevant information
will automatically be produced by the system.

For the After Sales Department, they use the ERIC System as well for their
business processes. The department utilizes the system by using it in their business
processes namely vehicle repair and maintenance and order from suppliers. Through
the ERIC system, the department is able to input and to access the information of their
current and new customers and the transactions that they have made with Chevrolet
North EDSA. Documents such as invoices are produced by ERIC to present the total
amount to expenses due from the customers. However, for the ordering from suppliers,
this is done manually through phone calls.

The Finance department handles the accounts receivable and accounts payable
records of the company. The department also uses the ERIC system in order to update
the companys financial accounts, and to generate the financial statements of the
company.

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As for the IT Department, they also use ERIC System to plan and develop
improvements and changes for the system if ever some errors or slack have been found
in the systems work flow.

The business operations of Chevrolet North EDSA run like this. Customers
inquire about the companys products/ services. Quotations are also given when
customers inquire. If the customers is satisfied with the price and product/ service of
the company, the sales manager then assess if the customer would pay in cash or
installment. If in cash, the transaction will now proceed to vehicle allocation by the
Sales Administrator. If installment, the customer would have to pay advance deposit
first to the cashier before the vehicle allocation step. The advance deposit will go to
the Finance department from the cashier. Then the Sales Administrator would prepare
the sales order. After that, the Sales Administrator would also collate all necessary
documents such as the vehicle checklist approval which will be given by the Sales
Manager. When everything is ready, Sales Invoice is processed by the Sales
Administrator. After the Invoice is prepared, the vehicle accessories are installed to the
chosen automobile. Then, the sales invoice will be updated again. After this, the
Official Receipt will be printed. Then the delivery of the vehicle would proceed.

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3.2

Existing Process Flow Diagram

34

Figure 3.1 Sales and After Sales Process Flow Diagram

35

Figure 3.2 Purchasing Process Flow Diagram

36

Figure 3.3 Payroll (Attendance and Employees) Process Flow Diagram

Figure 3.4 Finance Process Flow Diagram

3.3

Existing Information Systems

1. Human Resource Management


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Business Process:
a. Attendance- semi automated- uses MS Excel.
The company uses a time checker to monitor the attendance of the employees.
Using the cards, the HR personnel will manually input in the MS Excel.

b. Payroll- semi automated- use MS Excel


The input data in the MS Excel will be used in computing the payroll. The HR
personnel also adds certai n incentives for some employees, one of which is the bonus
a sales person gets for selling a car.

2. Sales
Business Process:
a. Inventory- Fully automated- uses ERIC system
The sales representative will input the details from the sales order in the ERIC
system. The inventory is also in the ERIC, so every time a customer buys a car, the
system deducts the product from the inventory.

b. Order from Customers- Manual- done through personal transaction


The customers personally go to the showroom of Chevrolet North Edsa to see
and purchase the cars that they want. The customers are also asked to fill up
information sheets such as the sales order for the company to take note of the
purchases.

38

3. After Sales
a. Vehicle Repair and Maintenance- fully automated- uses ERIC system
The company can use the information about the customer who has already
purchased a car from them but if the customer is new, the employees will have to ask
them to fill-out a form. The employees also have to input all the services they have to
make for the cars being repaired. The ERIC system will then create a final report on
the expenses that the customer needs to pay for the service.

b. Order from Suppliers- Manual- done through phone calls and personal transactions
The company has to contact their suppliers through phone calls in purchasing
new supplies. Usually, the company makes sure to have a stock for car parts that are
always in demand. As for the parts and equipment that are not that usually needed for
repair and maintenance services, the company orders it only when necessary. In
addition, for the newly purchased cars, a company representative commonly goes to
their main supplier; Chevrolet Philippines to order the cars availed by the customers.

4. Finance
Business Process:
a. Accounts Receivable- fully automated- uses ERIC system
b. Accounts Payable- fully automated- uses ERIC system
The company monitors their finances using the ERIC system. Both the
receivables and payables are stored in the system and its where they are constantly
updated. They also utilize the system to generate the companys financial statements.
39

5. Marketing
Business Process:
a. Promotion and advertising- semi-automated- uses internet particularly facebook;
uses text messaging
The company keeps it facebook page updated. Every now and then the
company posts their promos, freebies, services and products in their facebook page.
The company also makes use of text blasting to easily connect to their customers.
Usually, the content of their text messages focus on encouraging its customers to avail
their products and services. They also send updates through texts.

6. IT
Business Process:
a. Maintenance and overall operations of the system- fully automated- Uses ERIC
System
The IT department makes use of ERIC system in order to maintain and to
update the needs of the system. It manages the functions of the system. And also, the
IT department is also the division which is vital in the planning of the developments to
be made in the ERIC system.

3.4

Existing IS Development / Maintenance Capabilities


It was mentioned in the previous chapter the different hardware capabilities of
the company. It was stated that Chevrolet North EDSA currently has computers,
40

printers, photocopying machines, projectors, telephones and servers. The company


is also currently using the ERIC System and the Microsoft Office v2007 for their
software. The company is maximizing the use of Excel, Word and PowerPoint in
their workplace. The ERIC system of the company started during the same year of
the opening of Chevrolet North EDSA in 2011. The maintenance for ERIC, MS
Office and the companys hardware is continuous since Chevrolet North EDSA
greatly depends on technology in terms of accomplishing their business
requirements, and also the company has its own IT department which means that
there is always people in the company who could maintain and control the systems
in the company.

3.5

Existing IT Infrastructure and Equipment


As mentioned in the earlier chapter, the company has computers, servers,
printer, projector, photocopying machines and telephones. The company also has
the software needed to fulfill their operations particularly the Microsoft Office
v2007 and the ERIC System. The company also has an IT Department which
focuses mainly on the improvements and maintenance of the software and
hardware.

3.6

Major Current Capabilities


3.6.1

Hardware

41

Chevrolet North Edsa uses a total of 25 computers. For each office, around
2-4 computers are allocated for the daily functions of the department. Six Epson
printers are also available, and are installed in each department. Moreover, the
companies invested on photocopying machines for their documentation purposes,
and for effective communication, thirteen telephone units are also being used by
the company. Conducting meetings in the company is also more convenient since
they installed a projector in the boardroom.

3.6.2

Software

The companys computers are installed with Microsoft Office 2007. Particular
MS Office applications that the company uses include, MS Word, MS PowerPoint, MS
Excel, and MS Access. This software supports the employees in their daily tasks and
operations. Currently, the Human Resource Department uses MS Excel to gather and
store data regarding the employees, as well as in generating payroll sheets. MS
PowerPoint on the other hand, is normally used for reports such as sales reports, financial
reports, and management reports.
The other software used by the company is their current system called ERIC.
This system handles the companys business processes that are done under the Sales,
After Sales, Finance and IT Departments of Chevrolet North EDSA. This system
functions as the one monitoring, controlling and updating all the records/ databases of the
company. ERIC System also generates the necessary documents needed by the company
for its transactions with its customers and suppliers. Although this has been found useful
by the company, it still has some flaws such that it lacks some major functions related to
payroll and attendance.
42

3.6.3

Database

Normally, the company uses databases to handle financial accounts, and to keep
track of their sales and inventory. These databases are managed by the top management
and the department heads. Employees will not have a hard time viewing these databases
since they are stored in the ERIC System. However, not all departments make use of the
supposed to be centralized system yet.
Currently, the system of the Chevrolet North EDSA has different databases. One
of these is the Car Sales Database which records the all the vehicles sold by the company
only. This does not include the inventory of cars since the cars sold by the company are
directly acquired from its supplier, Chevrolet Philippines. Another database used by the
company is the Parts and Accessories Sales Database. This database functions similarly
with the Car Sales Database. The difference only is that this database focuses on the parts
and accessories sold by the company. Inventory of parts and accessories are excluded in
this database. The third database used by the company is the Accounts Receivable and
Payable Database. This database is used to monitor and to update all the debts and
receivables of Chevrolet North EDSA. In here, the company is able to manage the
information regarding the amount to due from customers and to suppliers, as well as the
maturity date for the debts and receivables. The company also has a database for its other
expenses related to the general and administrative expenses of the company such as
utilities, rents, etc. Lastly, the company uses a database for its inventory of office supplies
and car parts and accessories. This database functions mainly for the purpose of keeping
track of the quantity of the supplies of the company.

43

3.6.4

Telecommunications

For effective communication, the company has a total of two direct lines, 3 trunk
lines, and 8 local lines/extensions. These installations support the company in maintaining
its business processes and operations. Having a reliable Internet connection also helps the
employees in dealing with other entities from different locations.

3.7 Difficulties Meeting Business Requirements


Ordering and Re-ordering Products from Suppliers
Forecasting demand is a challenge for the company. It would be difficult to
control the regular sales orders and repair orders from piling up, since each customer
transacts on a different time from the other customers. Due to this issue, maintaining the
right amount or level of inventory becomes a concern for the employees from the Service,
Sales, and Purchasing Department. Ordering car units from Chevrolet Philippines and reordering spare parts from suppliers are some of the difficulties of the company in meeting
business requirements. They may not be able to guarantee the duration of the services that
they perform due to the uncertainty of the arrival time of the ordered products, thus
affecting customer satisfaction. Sometimes, it is also unavoidable to receive car units that
are defective from the main distributor. This causes the delay in delivering and releasing
vehicles that are of good condition.
Compliance with Government Requirements
The sudden changes in the regulations of the Land Transportation Office become
a minor issue for the company. Normally, it would only take a month or two to accomplish
the car registration process, and for car owners to acquire the plate number of their
44

vehicles. But nowadays, it would take the LTO 4-6 months to release the plates to car
owners.

3.8 Anticipated Future Demands


As of May 2014, a study reveals that there is a 10% expected growth in sales for the
automobile industry. Basing on the industry update, it could be inferred that the expected
growth in sales will correspond to a higher number of potential customers. With the right
amount of marketing and promotion strategies that could be implemented by the company,
there is no doubt that they will come prepared in anticipating and facing the future demand for
automobiles.

3.9 Description of Present System

Payroll

Scope

Customer

Human resource department and employees

Product

Salaries of Employees

Business processes

1. Attendance checker checks time in of employees


2. Input time in the system (late)
3. Checker records time out
4. Input time out in the system(early)
5. Generate employee attendance list
6. Input overtime hours
7. Input employee attendance List
8. Compute salaries of employees
45

Rationale: This process is done to compute the salaries that


the employees will receive
Participants

Employees and human resource department

Information

Attendance , overtime hours

Technology

Personal computer

Payroll

Architecture

1.Customer

The department uses the records to determine the salary.

2. Product

Record of employee attendance, overtime, and commissions.

3. Business processes

The HR department relies on the checkers data, and the


inputs made by the checker in the system

4. Participants

Attendance checker- assigned to record attendance


HR department employees- Perform functions such as
payroll, hiring, and training

5. Information

Employee attendance, commission, overtime pay

6. Technology

Personal computer with basic Microsoft office software

Payroll

Performance

1.Customer

Moderate satisfaction

2. Product

Low cost, little reliability

3. Business processes

Not secure and prone to human errors or biases

4. Participants

Human resource skills, and keen observation

5. Information

Tabulated data, easily accessible


46

6. Technology

Capable of organizing data and computing data, easy to use

Payroll

Infrastructure

1.Customer

N/A

2. Product

Computer and Microsoft Excel software

3. Business processes

Software updates and computer maintenance

4. Participants

N/A

5. Information

Employee database, Attendance records, commissions


records

6. Technology

Personal computer and Microsoft Excel software

Payroll

Context

1.Customer

Undeclared referrals

2. Product

Results may be bypassed by changing the inputs in the Excel


file.

3. Business processes

Proper compliance with the Philippine Labor Code

4. Participants

Participants may be pressured by working relations in the


recording of absences.

5. Information

Record of absenteeism is not disclosed to other employees.

6. Technology

Biometrics

47

Payroll

Risk

1.Customer

Erroneous checking of time in and time out


Unjust salaries resulting from erroneous inputs

2. Product

Power play and biases leading to altered time in and time out
records

3. Business processes

The attendance checker only checks one department or place


at a time, thus checking in other places may be later than
others.

4. Participants

The Excel file is the sole basis of the attendance, thus access
to the file can easily affect ones salary.

5. Information

The discrepancies of the time the checker sees the employee


from the time the employee actually arrived.

6. Technology

Viruses or software bugs can easily hold the system


incapable

Payroll

Opportunities

1. Customers

Proper compensation and salaries

2. Product

Provide more reliable output by a computerized way of


checking time in and time out

3. Business Processes

Reduce steps by computerizing processes

4. Participants

Conflict between the desired output and the attendance


48

checkers output
5. Information

Provide better information about absenteeism and tardiness

6. Technology

N/A

Accounts Receivable

Scope

1. Customers

Finance department, top management, and company


customers

2. Product

Records of accounts receivable

3. Business Processes

1. The company issues a sales invoice


2. All the records of debts of customers are directed to ERIC
3. The ERIC then computes the total accounts receivable of
the company
4. Produce copies of financial reports
Rationale: The enumerated processes are done to compute
for the total accounts receivable and use the data for further
financial analysis

4. Participants

Finance department, having the knowledge of basic


accounting.

5. Information

Transaction amount, price and quantity, date of maturity, and


the amount of receivables

6. Technology

The ERIC software and a personal computer

Accounts Receivable

Architecture
49

1. Customers

Uses the amount of receivables to calculate profits and net


income

2. Product

Printed financial reports and statements

3. Business Processes

The company relies on ERIC for the computation of the total


accounts receivable

4. Participants

Finance department members- responsible for managing the


financial statements of the company, including the
receivables

5. Information

Finance department and the top management has the access


to the financial statements and reports of the company

6. Technology

Computers and the ERIC system

Accounts Receivable

Performance

1. Customers

Highly satisfied employees due to ease of using the ERIC

2. Product

The computations provided by the ERIC are reliable and are


assumed to be free from errors

3. Business Processes

The time it takes for the computation of the accounts


receivable is minimal

4. Participants

Ability to interpret financial results and has the financial


skills

5. Information

The information are neatly presented and useful to know the


financial status of the organization, it is also easily accessible
for the finance department and for the top managers
50

6. Technology

Easy to use and is highly reliable

Accounts Receivable

Infrastructure

1. Customers

ERIC and ability to understand the financial data

2. Product

Computer lines and a financial analyst

3. Business Processes

ERIC has an annual debugging schedule, and training for the


use of ERIC is provided to new members of the companies
whose jobs require the use of ERIC

4. Participants

Financial consultants

5. Information

Database of financial statements and financial data

6. Technology

Computer and ERIC software

Accounts Receivable

Context

1. Customers

Concerns on confidentiality of the information, financial


information, provided

2. Product

Bypass product through gaining access to an employees


account

3. Business Processes

Conformance with the government regulations on


transparency of financial status

4. Participants

The financial information would avoid having bad debts

5. Information

Financial information gathered are not to be shared with nonmembers of the organization

6. Technology

Accessing only the information which is necessary to


51

perform an employees job.

Accounts Receivable

Risk

1. Customers

Inability to notice shortcomings of the system

2. Product

Inadequate financial data

3. Business Processes

Mismatch between peoples ability and the required to


interpret financial data

4. Participants

Inattention of participants to small details which may cause


financial discrepancies

5. Information

Financial information may be stolen

6. Technology

Failure of computer means restricted access to financial data

Accounts Receivable

Opportunities

1. Customers

Financial data is well monitored and bad debts are easily


avoided

2. Product

Ensuring collection of debts on time

3. Business Processes

The process requires participants who are educated to


identify and interpret the data shown

4. Participants

Learning the Financial process through the use of ERIC

5. Information

Better utilize the information provided by ERIC through


critical analysis

6. Technology

Use of data provided by ERIC to provide analysis and


decision making strategies
52

Accounts Payable

Scope

Customers

Finance department , company customers, and top management

Products

Records of payables

Business Process

1. The company incurs a debt


2. The record of the debts of the company is directed to ERIC
3. ERIC computes for the total payables
4. ERIC produces copies for reports

Participants

Finance department, having knowledge of accounting principles

Information

Transaction amount, price and quantity, date of maturity, and the


amount of payables

Technology

The ERIC software and a personal computer

Accounts Payable

Architecture

Customers

Uses the amount of payables to calculate losses or profits and net


income

Products

Printed financial reports and statements

Business Process

The company relies on ERIC for the computation of the total


accounts payable

Information

Finance department and the top management has the access to the
financial statements and reports of the company
53

Technology

Computers and the ERIC system

Accounts Payable

Performance

1. Customers

Highly satisfied employees due to ease of using the ERIC

2. Product

The computations provided by the ERIC are reliable and are


assumed to be free from errors

3. Business Processes

The time it takes for the computation of the accounts payable is


minimal

4. Participants

Ability to interpret financial results and has the financial skills

5. Information

The information are neatly presented and useful to know the


financial status of the organization, it is also easily accessible for
the finance department and for the top managers

6. Technology

Easy to use and is highly reliable

Accounts Payable

Infrastructure

1. Customers

ERIC and ability to understand the financial data

2. Product

Computer lines and a financial analyst

3. Business Processes

ERIC has an annual debugging schedule, and training for the use
of ERIC is provided to new members of the companies whose jobs
require the use of ERIC

4. Participants

Financial consultants

5. Information

Database of financial statements and financial data


54

6. Technology

Computer and ERIC software

Accounts Payable

Context

1. Customers

Concerns on confidentiality of the information, financial


information, provided

2. Product

Bypass product through gaining access to an employees account

3. Business Processes

Conformance with the government regulations on transparency of


financial status

4. Participants

The financial information would avoid having bad debts

5. Information

Financial information gathered are not to be shared with nonmembers of the organization

6. Technology

Accessing only the information which is necessary to perform an


employees job.

Accounts Payables

Risk

1. Customers

Inability to notice shortcomings of the system

2. Product

Inadequate financial data

3. Business Processes

Mismatch between peoples ability and the required to interpret


financial data

4. Participants

Inattention of participants to small details which may cause


financial discrepancies

5. Information

Financial information may be stolen

6. Technology

Failure of computer means restricted access to financial data


55

Accounts Payable

Opportunities

1. Customers

Financial data is well monitored and overdue company debts are


avoided

2. Product

Ensuring paying of debts on time

3. Business Processes

The process requires participants who are educated to identify and


interpret the data shown

4. Participants

Learning the Financial process through the use of ERIC

5. Information

Better utilize the information provided by ERIC through critical


analysis

6. Technology

Use of data provided by ERIC to provide analysis and decision


making strategies

Sales Inventory

Scope of the Analysis


car buyer/owner, sales representative, sales department,

Customer

service department, cashier

Products

sales invoice, sales report


1. The customer (car buyer or owner) will choose the car that
he wants to buy. The car will be assessed by the mechanics to

Business Process

know the service to be taken.


2. Sales representative will process the documents needed to
finalize purchase
3. Car buyer/owner will pay to the cashier (cash, bank
financing, credit card)
56

4. Sales Representative will create sales invoice


5. Sales department will create a sales report
Participants

Sales Department
Car Information (Model, color, freebies), Car Services,

Information

Customer Information

Technology

ERIC System

Sales Inventory

Architecture
Sales Department uses the products to create sales invoice that

Customer

will be sent to the finance department


Number of sales per day, number or services per day,

Products

purchase information, daily sales report


System will generate sales report using customer information

Business Process

and car information/service information


Sales Representative - reports to the Sales Department, talks
to an interested customer and process the information needed

Participants

for the purchase


Sales Department - creates sales report and monitors
profitability of the company
Customer Information - name, address, contact number and

Information

other important details


Car Information - car model, color, freebies (add-ons and
after-sales services)
57

Hardware: Computers used by cashier and sales department,


Technology

cash register
Software: ERIC System

Sales Inventory

Performance
Customers are moderately satisfied with the products

Customer

generated by the system

Products

Reports are reliable

Business Process

The system can generate a daily sales report instantly.


Consistent information.

Participants

Computer literate, knows how to use ERIC


After sales department employees can access the database that

Information

contains the service invoices anytime

Technology

ERIC cannot be easily used.

Sales Inventory

Infrastructure

Customer

ERIC users' training

Products

Computers, Intranet

Business Process

Software and hardware maintenance

Participants

Trainers and trainees


Databases contain customer information, list of services and

Information

service invoice, list of cars


58

Technology

ERIC system

Sales Inventory

Context

Customer

Price of the car, availability of the car, car parts available


Other car models or other version of the car chosen by the

Products

buyer.
Sales

Business Process

Representative/Service

Representative

takes

full

responsibility on the customer during purchasing.


The company does not violate any law or regulation
Sales

Representatives

must

be

good

communicators.

Mechanics must be well educated with the services being


Participants

offered by the company


Sales Representative cannot use customer's information for

Information

his or her own benefit

Technology

Use ERIC in generating sales invoice

Sales Inventory

Risk
Late delivery of the purchased car to the buyer. Late

Customer

accomplishment of the services needed for the car


Wrong

information

input

by

the

personnel.

Wrong

Products

information given by the buyer

Business Processes

No database other than ERIC's

Participants

Dishonest sales representative, fake documents given the


59

buyer
Information

Alteration of data
Redundant and inconsistent information. ERIC system's

Technology

failure.

Purchasing Inventory

Scope of the Analysis

Customers

Sales Department, Suppliers

Products

Purchase Invoice
1. Purchasing Inventory Department will get data from the

Business Process

database of car and service


2. Purchasing Dept will evaluate the information
3. Purchasing Dept will order cars or car parts from suppliers
(Purchase Order)
4. Purchasing Department will create Purchase Invoice (Will
be sent to the Finance Department)
5. Update Purchase Inventory for cars and car parts (Services)

Participants

Purchasing Department
Car information, car parts information, number of stocks

Information

available, number of stocks needed

Technology

ERIC System

Purchasing Inventory

Architecture

Customers

Purchasing Department uses products to monitor inventory,


60

generate reports, order supplies from suppliers


Sales invoice, number of stocks available, sold-out stocks, car
Products

information, car parts information

Business Process

System will generate inventory report.


Purchasing Department will know what to order to Chevrolet
Philippines/Suppliers

Participants

Purchasing Department - orders out of stock cars


Supplier (Chevrolet Philippines) - deliver cars
Purchase information - car model, color, quantity, and date of

Information

delivery

Technology

Hardware: Computer, Telephone


Software: ERIC System, Chevrolet System

Purchasing Inventory

Performance

Customers

Moderately satisfied

Products

Reports are reliable

Business Process

The system can show inventory status anytime.


Computer literate, knows how to use ERIC, knows how to use

Participants

telephone

Information

Information can be accessed easily

Technology

ERIC cannot be used easily

Purchasing Inventory

Infrastructure
61

Customer

ERIC users' training

Products

Computers, Intranet, telephone, telephone connection

Business Process

Software and hardware maintenance

Participants

Trainers and trainees

Information

Sales department can access the files

Technology

ERIC system, telecommunications system

Purchasing Inventory

Context
Availability of the car/car parts from the supplier, date of

Customer

delivery

Products

N/A

Business Processes

Must follow regulations imposed by Chevrolet Philippines


Sales Department must ensure that the cars are new and in

Participants

good condition

Information

N/A

Technology

N/A

Purchasing Inventory

Risk

Customer

Late delivery of cars from the supplier (Chevrolet Philippines)

Products

Wrong order information sent to Chevrolet Philippines.

Business Process

Will not be able to send order to Chevrolet Philippines

Participants

Incompetent sales department employee

Information

Wrong car information


62

Technology

N/A

Chapter 4 IS Impact on Company Mission and Strategy


4.1 Impact on Company Mission
Chevrolet North EDSA aims to continue winning the Dealer of the Year Award by
tapping their target market in the Northern Quezon City and provide their customers with
the kind of satisfaction that they are expecting through the use of Emphatic Customer
Satisfaction. Information System has helped the company a lot in terms of giving the
customers their needs and satisfaction. With the use of information system, the company
is able to record the profiles of their customers to be familiar with their common needs
and wants. Information system has also assisted Chevrolet North EDSA when it comes to
providing quality services and products to its customers. Also, through the information
system, the company is able to provide the customers with the convenience and ease of
transactions because with the information system on hand, every process becomes faster
and more accurate. Information system has indeed been a great help for Chevrolet North
EDSA to become more competitive in the industry.

4.2 Impact on Company Strategy


Information system has provided great impacts on the strategy of Chevrolet North
EDSA. Through the information system that they are currently using, the company is
able to keep track and control the different operational processes in the company. The
system has also affected the speed and accuracy of the processes and information going
63

around the company positively. With the information system, it becomes easier for the
company to plan for the improvements to be made to achieve customer satisfaction. It has
also helped the company in monitoring the sales and expenses coming in and out of the
business. Information system has also provided the company the ease of computing and
generating financial statements, receipts, invoices and other related documents. So far,
the company believes that the information system is continuously proving its worth in the
business by providing an efficient and effective means to complete every automated
business process and by outweighing the benefits of the traditional or manual business
processing.

Chapter 5 - IS Architecture
5.1

Description of Identified Information Systems


Chevrolet North EDSA is a car dealership company in which they sell various

types of vehicles from Chevrolet Philippines. The company has a wide target market that
ranges from the various cities in Metro Manila and the other nearby provinces in the
Northern part of Luzon. With these things on hand, Chevrolet North EDSA must make
sure to take control of all its business processes from all its departments to ensure the
smooth flow of operations and to guarantee higher customer satisfaction.
List of Business Activities:
1. Customers inquire about the companys products/ services. Quotations are also given
when customers inquire.
2.

If the customers is satisfied with the price and product/ service of the company, the sales
manager then assess if the customer would pay in cash or installment. If in cash, the
64

transaction will now proceed to vehicle allocation by the Sales Administrator. If


installment, the customer would have to pay advance deposit first to the cashier before
the vehicle allocation step.
3. The advance deposit will go to the Finance department from the cashier. Then the Sales
Administrator would prepare the sales order.
4. The Sales Administrator would also collate all necessary documents such as the vehicle
checklist approval which will be given by the Sales Manager.
5. When everything is ready, Sales Invoice is processed by the Sales Administrator.
6. After the Invoice is prepared, the vehicle accessories are installed to the chosen
automobile. Then, the sales invoice will be updated again.
7. After this, the Official Receipt will be printed. Then the delivery of the vehicle would
proceed.

5.2

Data Flow Diagram

Figure 5.1 Context Diagram


65

Figure 5.2 Diagram 0

Figure 5.3 Child Diagram for Process Customer Order


66

Figure 5.4 Child Diagram for Process Payment

67

Figure 5.5 Partition- Child Diagram for Process Payment

Figure 5.6 Child Diagram for Generate Payroll

Figure 5.7 Physical- Child Diagram for Generate Payroll


68

Figure 5.8 Partition- Child Diagram for Generate Payroll

Figure 5.9 Child Diagram for Order Product

69

Figure 5.10 Child Diagram for Update Financial Accounts

Figure 5.11 Partition- Child Diagram for Update Financial Accounts

70

F
igure 5.12 Child Diagram for Perform Maintenance and Services

5.3

Description of Conceptual Databases


Employees
Employees =

EmployeeName =

EmployeeContact =

EmployeeID +

Autonum

EmployeeName +

Varchar (20)

EmployeePosition +

Varchar (15)

EmployeeContact +

Varchar (12)

EmployeeAddress +

Varchar (30)

EmployeeBank
LastName +

Varchar (10)
Varchar (9)

FirstName +

Varchar (9)

MI
AreaCode +

Varchar (2)
Varchar (2)
71

EmployeeAddress =

Contact#
StreetNumber +

Varchar (10)
Varchar (3)

StreetName +

Varchar (10)

City +

Varchar (13)

ZipCode
Table 5.1 Data Dictionary for Employees

Varchar (4)

Payroll
Payroll =

SalaryRate =
Attendance =

EmployeePremiums =

EmployeeID +

Autonum

SalaryRate +

Currency

Attendance +

Date/Time

EmployeePremiums +

Currency

OvertimeRate +

Currency

Commissions
Rate_Hour
TimeIN +

Currency
Currency
Time

TimeOUT +

Time

Date
SSS +

Date
Currency

PhilHealth +

Currency

HDMF
OvertimeRate =
Rate_Hour
Table 5.2 Data Dictionary for Payroll

Currency
Currency

Attendance
Attendance =

EmployeeID +

Autonum

TimeIN +

Time

TimeOUT +

Time

Date

Date
72

Table 5.3 Data Dictionary for Attendance


Finance
Finance =

{AccountsReceivables} =

{AccountsPayable} =

{Payroll} =

PurchaseInvoiceID +

Autonum

SalesInvoiceID +

Autonum

POID +

Autonum

{AccountsReceivable} +

Varchar (28)

{AccountsPayable} +

Varchar (28)

{Payroll} +

Varchar (25)

SalesOrderID +

Autonum

OtherExpensesID
CustomerName +

Autonum
Varchar (20)

AmountDue +

Currency

DateDue
SupplierName +

Varchar (8)
Varchar (20)

AmountDue +

Currency

DateDue
EmployeeName +

Varchar (8)
Varchar (20)

TotalSalary

Currency

EmployeePremiums +

Currency

Commissions +

Currency

Overtime

Currency

Table 5.4 Data Dictionary for Finance


Other Expenses
OtherExpenses =

SupplierID +

Autonum
73

OEItemID +
AmountOthers
Table 5.5 Data Dictionary for Other Expenses

Autonum
Currency

Customer
Customer =

CustomerName =

CustomerAddress =

CustomerCN =

CustomerID +

Autonum

CustomerName +

Varchar (20)

CustomerAddres +

Varchar (30)

CustomerCN
LastName +

Varchar (12)
Varchar (9)

FirstName +

Varchar (9)

MI
StreetNumber +

Varchar (2)
Varchar (3)

StreetName +

Varchar (10)

City +

Varchar (13)

ZipCode
AreaCode +

Varchar (4)
Varchar (2)

ContactNumber
Table 5.6 Data Dictionary for Customers

Varchar (10)

Sales Order
SalesOrder =

CustomerID +

Autonum

CarID +

Autonum

Quantity +

Char (4)

ServiceOrderID +

Autonum

SalesOrderID
Table 5.7 Data Dictionary for Sales Order

Autonum

Sales Invoice
74

Sales Invoice =

Quantity +

Char (4)

CustomerID +

Autonum

ServiceOrderID +

Autonum

CarID +

Autonum

AmountSales +

Currency

EmployeeID +
Table 5.8 Data Dictionary for Sales Invoice

Autonum

Car
Car =

CarID +

Autonum

Model +

Varchar (19)

Color +

Varchar (7)

{Specs} +

Varchar (75)

NumberOfUnits +

Char (4)

Model =

Price
Type +

Currency
Varchar (15)

Specs =

YearReleased
Engine +

Varchar (4)
Varchar (10)

Wheels +

Varchar (4)

Lights +

Varchar (10)

AirCon +

Varchar (10)

Battery +

Varchar (10)

Gauges +

Varchar (10)

OtherAccess

Varchar (20)
75

Table 5.9 Data Dictionary for Car


Service
Service =

ServiceID +

Autonum

ServiceType +

Char (2)

ServiceFee +

Currency

ItemID +

Autonum

CustomerID
ServiceType =
[Repair: Maintenance]
Table 5.10 Data Dictionary for Service

Autonum
Char (2)

Purchase Order
PurchaseOrder =

POID +

Autonum

CarID +

Autonum

Quantity +

Char (4)

Price +

Currency

SupplierID +

Autonum

ItemID +

Autonum

OfficeID +

Autonum

DateOfDelivery
Table 5.11 Data Dictionary for Purchase Order

Autonum

Purchase Invoice
Purchase Invoice =

PurchaseInvoiceID +

Autonum

POID +

Autonum

TotalPrice +

Currency

DateOfPayment
Table 5.12 Data Dictionary for Purchase Invoice

Date

76

Supplier
Supplier =

SupplierName =

SupplierAddress =

SupplierContactNumber =

SupplierID +

Autonum

SupplierName +

Varchar (20)

SupplierAddress +

Varchar (30)

SupplierContactNumber
LastName +

Varchar (12)
Varchar (9)

FirstName +

Varchar (9)

MI
StreetNumber +

Varchar (2)
Varchar (3)

StreetName +

Varcher (10)

City +

Varchar (13)

ZipCode
AreaCode +

Varchar (4)
Varchar (2)

ContactNumber
Table 5.13 Data Dictionary for Supplier

Varchar (10)

Office Supplies
OfficeSupplies =

OfficeID +

Autonum

SuppliesName +

Varchar (20)

Quantity +

Char (4)

Price
Table 5.14 Data Dictionary for Office Supplies

Currency

Car Parts
CarParts =

ItemID +

Autonum

ItemName +

Varchar (20)

ItemPrice +

Currency

Quantity

Char (4)
77

Table 5.15 Data Dictionary for Car Parts


5.4

IS and Ownership

Information Systems

Ownership

Employees

Microsoft Excel- used for tabulating the


attendance and computing for payroll of the
employees.

Payroll

Microsoft Excel- this is used for computing for


payroll of the employees.

Attendance

Microsoft Excel- this is used for tabulating the


attendance of employees.

Finance

ERIC System- this uses the system to monitor


sales and expenses. This is also used to control
the companys accounts receivable and
accounts payable.

Other Expenses

ERIC System- it uses the system to monitor


and record the expenses made by the company
from its utilities and other general and
administrative expenses.

Customer

ERIC System- this is used to keep the records


and profiles of the customers of Chevrolet
North EDSA. The customers purchases from
the company could also be seen here.

Sales Order

ERIC System- the generation of Sales Order is


prepared with the use of the system. The
records of the transactions could be acquired
from the database of the system.

Sales Invoice

ERIC System- the creation of the sales invoice


uses ERIC system to get the necessary
information regarding the sales made with the
customers and also to acquire the amount due
from the customers.

Car

ERIC System-this makes use of the system by


78

recording the details of the cars bought by the


customers. This is somewhat the inventory of
the vehicles sold by the company.
Purchase Order

ERIC System- the purchase order uses the


system to acquire and record the PO given to
the suppliers for the ordering of supplies.

Service

ERIC System- this uses the system to record all


the service transactions between the company
and the customers of Chevrolet North EDSA.

Purchase Invoice

ERIC System- this uses the system to record


the invoices gotten from the suppliers, as well
as to verify the amount due to the customers.

Supplier

ERIC System- this uses the system to keep the


companys records of their suppliers of cars,
car parts and other supplies used by the
company.

Office Supplies

ERIC System- this uses the system in terms of


keeping track of the records of the office
supplies of the company. This is somewhat the
inventory record for office supplies of
Chevrolet North EDSA.

Car Parts

ERIC System- this uses the ERIC system to


control and monitor the new as well as the sold
car parts of the company that were used to
render services and to sell products to the
customers.

Chapter 66.1

The IT Strategy

New System Project Description

79

The company currently operates with ERIC, a system whose functions are limited to
automatically computing the amount of sales and services that the company has provided. Other
functions such as payroll, purchasing, and keeping track of the companys inventory are done
manually.
Three methods of improving the current situation are being considered and are being
carefully examined. The first is creating a new system which would automate the different
functions of the company and having it created by the companys own IT department. The
second is creating the same system but employing an external team to create the system. Finally,
the last method is purchasing a COTS which would generally suit the companys operations.
The proposed system would automate the process of creating a payroll by taking
advantage of a biometrics scanner which would automatically record the attendance of the
employees, the attendance would then be used in computing the employee payroll. Another
function of the system is to automate the tracking of the companys inventories by providing
databases. Finally, the process of prompting a purchase would be automatically done as a
database of purchased inventory would be kept to easily identify a need for purchase.
The functions of the proposed system are aimed to attain efficiency and avoid
unnecessary activities which consume time. The proposed system saves time in a number of
activities; manually checking the attendance, manually checking which cars and parts are
available for sale, and manually checking which supplies are running low.
Payroll
In the current system, the attendance is checked through an attendance checker, the
results are manually recorded, and the payroll is computed through Microsoft Excel. In the same
80

way, the computed payroll is manually deducted to the financial data of the company to get a
holistic report on the companys overall financial position.
The proposed system uses a biometrics scanner to automatically record the attendance of
the employees. The attendance data would be used to compute for the payroll, these then would
be stored in a database which would be used by the finance department in creating financial
reports.
Sales, Service, and After Sales
In the current system, the availability of cars, parts and services are manually checked,
thus putting the customers in queue while waiting for the response on the availability of the car,
parts, and service.
The proposed system will use a car and service database to easily identify which cars,
parts, and services are available. The time it takes to check the availability of the required
product is lessened exponentially and thus provides efficiency.

Purchasing
In the current system, the employees just inform the company of a lack in supply when
the shortage already exists, the purchasing is also done manually and purchases only what is
needed at the time being. This causes a repetitive process of buying different items, in different
times every time there is a shortage in the supply of such particular item.

81

The proposed system takes advantage of a purchase inventory database to easily monitor
which supplies will run out. With this, purchasing of supplies may be done in bulk. This will
save time and expenses due to the repetitive buying process.
Finance
The current system could only compute for all the receivables and revenues generated
from the sales and after sales. These computed data would then be combined with payroll, other
expenses, purchasing expenses, and other financial data to manually compute for the overall net
income of the company.
The proposed system stores all these financial data in databases. These data would then
be combined to compute for the net income of the company and generate financial reports.

6.2-

Application Systems Development Strategy


The groups strategy is to look at each department, and identify the differences of the

work nature of one with the others. The group would also take note of the similarities of one
department with the others so as to be able to devise a system that would fit the organization as a
whole. The initial interface of the system will be based on the observed environment and work
nature in Chevrolet North EDSA and would then be consulted with the company, particularly
with the users and adjust it according to their demands.
Once the proposed software has been established, it would be checked for misalignments
and errors. The company would then have the choice to either accept it or reject it. If the
company chooses to accept it, another decision would be made of whether to outsource it and let
82

an external group of programmers create the system, fund the companys IT department to make
the system, or buy a pre-made system that would somehow serve the same purpose as the
proposed system. The decision making team would consider a number of factors in accepting or
rejecting the system; economic feasibility, technical feasibility, and operational feasibility. In
determining its economic feasibility, the decision makers would check if the tangible benefits
could outweigh the tangible costs. In technical feasibility, the decision makers would then again
check if the proposed system would be compatible with their existing system and with their
current equipments. Finally, in operational feasibility the decision makers would look at the
capacity of the organization and its employees to operate the system.

6.3-

Data Management Strategy


The companys data are confidential and are only accessible by employees who need

these data for the completion of their jobs. These are data rendered confidential and critical as it
contains the companys contacts from which potential buyers come from, and also these will
reveal the companys financial status. Such data will be stored in databases for ease of access and
security.

6.4-

New Capabilities Required


6.4.1

Hardware Strategy

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The new system requires various new hardwares; a biometrics scanner, a new computer,
router and LAN cables. The biometrics scanner and new computer, to which the scanner would
be connected, would be strategically placed in the front desk of the office to easily scan and
record an employees attendance. A new computer is needed because the biometrics scanner
could not just be connected to any computer in use as it may cause disruption to the user.
Currently, the company has 25 computers and the proposed system requires 1 more
computer, adding up to a total of 26 computers, all these 26 computers would be connected
through Local Area Network. For this to come about, the company needs a router to connect
computers from different departments, the LAN cables would be used to connect them. This
would allow data receiving and transfer from one department to another.
Within the company itself, LAN would be used to connect the departments and make the
flow of information easier. With regards to its suppliers, either the internet or the telephone lines
would be used as a mean of communication.
6.4.2

Software Strategy

A new system would be created; the same means that the current software used by the
company- the ERIC would no longer be used. The decision on what software is needed would be
dependent on the result of the feasibility test. The proposed software would either be done by
external programmers or by the companys own IT department. This software would perfectly fit
the needs of the company as it is designed to address their problems. The COTS software would
just be bought and may not be a perfect fit for the company. Both softwares would serve the
same functions; facilitate automated functions, provide ease of information flow, and avoid
redundancies.
84

6.4.3

Database

Few additional databases will be established to make the system effective. The first set
are the employee database and attendance database. Cars database and parts or service database
would also be used. This is to avoid the consumption of unnecessary time to manually check the
available cars and parts while putting the customer in queue. A purchased inventory database
would also be used to automatically check which supplies are about to run out. Finally, a
financial database would also be needed to keep records of previous financial reports which
would serve as a basis for comparison in the future.
6.4.4

Telecommunications

The proposed system would provide ease in sharing of information, better access to
information, and better communication. The system, being centralized, could link one
department to the other. A Local Area Network(LAN) will be imposed in the company, this will
serve as the link between the departments. The LAN would then facilitate ease of information
sharing. With regards to the companys suppliers, the telephone and the internet, particularly
electronic mails would facilitate information sharing and communication. Both telephone lines
and internet are currently present in the company.

6.5

Organizational Strategy

During the groups immersion the group has noticed that although the company has a
written and pre-identified hierarchy of authority, the environment of the work place is very
85

organic, people are relating with their co- workers as if the hierarchy is inexistent. With such
kind of environment, coercion or forcing employees to learn and adapt with the new system
would be ineffective. Group training may be effective in such particular situation.
Should the company proceed with creating the proposed system and having the IT
department create the system, the company would need additional IT personnel. About 2-3
additional employees in the IT department should be hired by the company. The company,
preferably, should hire these employees on a contractual basis. Having them as permanent
employees may create unnecessary costs after the creation of the system. Although the group
suggests that economically, a contractual manner of hiring these employees are more feasible,
the group does not necessarily persuade the company to do so considering their ethical beliefs.
As stated in the previous section, new hardware, software, and databases would be
acquired.

Chapter 7 - Implementation Plan


7.1

Detailed Implementation Plan


As mentioned earlier, the group plans to implement a new system wherein the new

system will be connected to the companys ERIC system. The new system will link the
inputs, outputs and functions of the HR and Marketing departments to ERIC System. For
the implementation step of the propose system, the group has come up with three
alternatives that Chevrolet North EDSA could take into consideration. The first option
would be the employment of an outside application server provider team to create and
develop the customized system. The second is the creation of the customized/ proposed
86

system by the in-house IT department of Chevrolet North EDSA. And lastly, the purchasing
of similar, if not the same, commercial off-the-shelf software package to the proposed
system. The group of system analysts has planned three different strategies that the group
thinks is the best fit for each alternative stated. These strategies will be used to aid the
company in converting their current business processes into the new proposed system.

Although the company already has its own IT department, it could still be possible
for them to employ an application server provider company, or in other words, outsource a
development team to create, develop and maintain the proposed system. The costs that
would be incurred in outsourcing a system provider is much less compared to the costs that
would be incurred if the in-house IT department would create the proposed system. The
strategy that the analysts think would be great is the Phasing Conversion Strategy. Since the
proposed system will just be connected to the current system of the company, it would be
better if the strategy will focus only on one department at a time. This is the most beneficial
strategy particularly for the Human Resource and Marketing departments since they will be
changing their systems from manual to automated process. Phasing strategy would help
also them adjust easily and learn the uses of the system more effectively. Anticipated errors
from the system could easily be identified as well if the company would use Phasing
strategy. Another good thing about this strategy is that the company could ensure that the
system functions is aligned per department and is working properly. It would also be more
convenient for the outsourced company to use this strategy because any changes and/ or
further improvements to be made in the proposed system would not be difficult to execute.

87

For the second alternative which is to create the system development with the inhouse IT department, the system analysts believe that it is best to use the Phasing
Conversion Strategy. This alternative is similar to the first one; however, the difference is in
terms of the period of time in making the system. Developing the system in-house would
surely take a longer time compared to outsourcing it because the IT department has also
other things to do such as the maintenance of the ERIC system. Usually the cost of
developing the system in-house is cheaper, but in this case the second alternative is more
expensive since it will take a longer time to finish the system in-house.

The third alternative is the COTS. COTS or commercial-off-the-shelf system is a


system that can be instantly used by the company. This is a type of system where in the
company needs to adapt to the system which is the opposite of what the analysts and
company want to have. There might be some features that the company needs for their
operations that are not available in the system purchased but there are also COTS that are
flexible and the company can add the features that they want to have, one of which is
SAGE ERP X3. SAGE ERP X3 is a system that is used by more than 4000 companies
across the globe. This system is available on and off site, which means that the employees
can access the files they need using their phones and other gadgets. It is also integrated
with Microsoft Office programs and the employees can import and export data easily.

88

Figure 7.1 SAGE ERP X3 Process


7.2

Anticipated Difficulties in Implementation


Although information systems are very beneficial for various companies, there are

still a few issues as to why some enterprises are not considering the use these information
systems. Take into consideration the situation of Chevrolet North EDSA. The proposed
system is made to help the company improve their business processes in order to meet the
expectations of the top management, clients, suppliers and other external and internal
entities. However, series of difficulties are expected to come in during the process of
implementation. The first and number one anticipated difficulty is the resistance of the
employees to use the proposed system. This would most likely be seen from the HR and
Marketing department employees since they are the ones who would experience the biggest
adjustments in their work process which the manual to automated business processing. The
second anticipated issue would be the need for training of the employees is using the new
89

system. The training needs would also be more prominent in the workers of the Human
Resource and Marketing Departments. Definitely, the other employees from the other
departments as well as the top and middle managements would also need training on the
functions of the proposed system. The next expected difficulty is the period of the creation
of the system. If ever the proposed system would be used, the waiting time before the
system is ready to operate could take quite a long time since many considerations are still
on the way. Lastly, the cost would also be one of the important issues in the
implementation. Information systems whether the users like it or not, entails big costs.
Company owners might be hesitant to continue to system if it would incur costs that are too
big. Although there is surety in the benefits of the systems, costs are still costs, so it is
expected from the owners to think twice or thrice on whether to pursue with the proposed
system of not. Opportunity costs during the creation period of the system are also taken
into account, since the company is hoping for lower amount of regrets/ opportunity costs.

Chapter 8 - IS Development Schedule


8.1

IS Development Plan
After the Information System Plan has been proposed to the company, it is the

management who will make the final decision regarding the pursuance of the proposed
system. However, the system analysts believe that among the three alternatives presented,
the outsourcing of the system developer (ASP) for the creation of the proposed system is
the best one to accept.

90

In outsourcing or employment of an outside development team to create the


proposed system, a long process is on the way as to the period before the new system
could be fully operational. In this alternative, the system analysts will act as the
middleman. The system analysts will be the one who will look for the software developer
companies. Most likely, the analysts and the company would only consider the software
developers located in within Metro Manila. After searching for companies, the analysts
will then screen the prospect software developer companies as to which company could
provide the best services and products, and yet has a practical and realistic price ranges.
Next to the screening process is the setting up of meetings among the analysts, the chosen
software company and Chevrolet North EDSA. In the meeting, the three entities would
discuss about the proposed plans, schedule of implementation and costs to be incurred. If
everything goes well in the meeting, contract signing and down payment will then be
done to be able to start the creation of the system. Necessary agreements among the
Software Company and Chevrolet North EDSA will be placed in the contract. The
contract signing will signal the start of the development of the system. In duration of 30
days, it is expected that the new system will be done and ready for implementation. After
this 30 days, the newly made system will be present to the company. It was mentioned in
the earlier chapter that the conversion strategy to be used for the implementation is the
Phasing Strategy, so the implementation will be done per department. It will start first
with the HR department, followed by the Marketing department, then Sales, After Sales
and lastly is the IT department. Training will follow after implementation for the users of
the new system. After the users have been familiar with the new system, finalization
process will be done to ensure efficient and effective functions and to make changes and
91

improvements if necessary. Lastly, if the new system has been operating within the
company, additional improvements could also be asked from the software company.

Currently, the system analysts are looking for potential software developer
companies. The analysts have a few in minds already, but further screening is still on the
process before proposing the prospect software developer companies to Chevrolet North
EDSA.

Another alternative that the system analysts suggested is to have the in-house IT
department of the company create the proposed system. In here, the IT professionals
would have to be in a meeting with the top management in order to plan for the new
system to be made. In the meeting, they will discuss the costs, period of development,
functions, users, trainings and implementation plans for the proposed system. It was
mentioned in the earlier chapter that this alternative will use the Phasing conversion
strategy, so it means that the implementation will be done per department as well, like the
first alternative. 90 days will be allotted for the development of the system, excluding all
training, meeting and implementing period. This alternative is beneficial for the company
since there will be no much difficulties in the communication between the developer and
the user.

The analysts propose that the company should avail of SAGE ERP X3 if they
already need a system and cannot wait any longer. SAGE will train the users to fully
understand the features of the system. The features of SAGE ERP X3 can also be changed
92

any time but the full responsibility is still within the company. The analysts recommend the
company should use parallel conversion to be able to monitor the problems and errors that
the users will encounter during the implementation.
8.2

Schedule of Systems Developments

Outsourcing System Developer

LETTER

ACTIVITY

DAYS
REQUIRED

A
B
C
D
E
F
G
H
I
J

Search for Software Developer


Screen Potential Companies
Set Meeting with Developer and Client
Contract Signing and Initial Payment
Programming/ Development of New System
Presentation of New System to the Company
Implementation: HR
Implementation: Sales
Implementation: After Sales
Implementation: Finance

3
2
1
2
30
8
5
5
5
5

A
A, B
C
D
E
F
G
H
I

Training of Users

12

G, H, I, J

Finalization/ System Run

Additional Improvements (Postimplementation)

PREDECESSOR

Table 8.1 Outsource System Developer Schedule

93

F
igure 8.1 Gantt chart: Outsource System Developer

In- house IT Department


LETTER

ACTIVITY

DAYS
REQUIRED

Meeting and Contract Signing

Programming/ Development of New System

90

Presentation of New System to the Company

Training to the users

30

Implementation: HR

Implementation: Finance

Implementation: Purchasing

Implementation: Sales

Finalization

PREDECESSOR

Table 8.2 IT Department Schedule

94

F
igure 8.2 Gantt Chart: IT Department

Purchase COTS

LETTER

ACTIVITY

DAYS
REQUIRED

Consult with SAGE Personnel

Evaluate the Features to be Purchased

Choose Users

Purchase COTS

User Training

C, D

Implement System

20

System Tests

Maintenance

PREDECESSOR

Table 8.3 COTS Schedule

95

Figure 8.3 Gantt chart: COTS

Chapter 9 - Budget Requirements


9.1

Requirements
There are three possible solutions for the company. But with these three different

solutions come with various costs relating to development and operational functions. The
costs of each option are dependent on the needs/ requirements of the customized system.

For the first alternative, the company could hire or outsource software developer to
create the proposed system. In this solution, the company would not have any difficulties
in terms of maintaining the system because it is already the software company which will
do that function. In figure 9.1, the cost to be incurred for the first option is broken down
to present the division of the total costs in relation to the needs and requirements of the
system implementation.

96

Figure 9.1 Costs for Outsourcing

The second alternative is to order the companys own IT department to create the
proposed system. Creating a proposed system ensures that the system is fit for the needs
of the organization as it is specifically designed for the company, based on their structure,
work environment, and necessities. Ordering the companys own IT department to
develop the system may also cost more, than hiring an external programmer as an
additional three IT personnel is needed to be employed in order to create the program.

97

Figure 9.2. Cost for IT Department

The second alternative would result to a total initial cost of P799, 336.70. For
further explanations on how such values are derived, refer to Figure 9.2.1.

Figure 9.2.1 Derivation of Training Cost

The training cost comprises of the salary of the employees who will use the new
system at 1 hour each day, which is the most allowable by the company to ensure
continuity of the companys operation.
98

The third alternative is COTS that will be purchased from SAGE. It will also
provide all the things that the company needed for implementation except for the
computers and biometrics system. The computers that are going to be used for the
implementation of SAGE ERP X3 will be the computers that Chevrolet-Balintawak is
currently using.

Figure 9.3 Costs for COTS

9.2

Potential Savings
With the proposed system, the company would be able to avoid turnover costs and

increase sales due to customer satisfaction.

99

Figure 9.4 Total Benefits of the Proposed System

Figure 9.5 Total Turnover Cost Savings

According to a research 40% of employees leave their current organizations due


to perceived injustice and conflict with co-workers. The company has a turnover incident
of at least one in every 2 months. One of the possible reasons for this relatively high
turnover ratio is the employees perceived injustice. With the use of the current system,
there are latecomers who are not being sanctioned due to the time discrepancy it takes the
attendance checker to check one department to the other, there are also alleged biases
100

displayed by the attendance checker. Preventing turnovers saves the company the
overtime cost it has to pay its employees to fill up for the retirees vacant job and the
training cost it will incur to train the new employee hired.

Figure 9.5 Increase in Sales due to Customer Satisfaction

The new system provides better information management, ease of access to


inventory and avoids putting the customer in queue. This leads to customer satisfaction.
Research has shown that for retail companies, an increase in the customers satisfaction
also reflects an increase of 5% to 10% in the companys sales. The group chose to be
conservative and used 2% because the waiting time is only one of the factors in
determining a customers satisfaction.

9.3

Cost Benefit Analysis


Outsource System Developer

101

Table 9.1: CBA for Outsourcing System Developer

Tangible benefits

Turnover cost savings


Discount cost savings
Promotional activities savings
Reduction in bad debts
Reduction in interest cost

Intangible benefits

Better decision making


Organized flow of information
Better organizational environment
Accurate information
102

IT Department will have more time to focus on their jobs because they are not required to

maintain the system.


Faster period to create the system.
Less hassle for the IT Department to train the users.

Tangible Costs

Cost of the biometrics scanner


Training cost
Cost of Computer
Cost of LAN Cables
Cost for System Development
Cost For Router
Costs for Maintenance

Intangible costs

Unproductive workers while coping up with changes


Inefficient work during transition
Difficulty in communication between company and system developer.
In-house IT Department

103

Table 9.2 CBA for IT Department

Tangible benefits

Turnover cost savings


Discount cost savings
Promotional activities savings
Reduction in bad debts
Reduction in interest cost

Intangible benefits

Better decision making


Organized flow of information
Smoother workflow
104

Better organizational environment


Accurate information

Tangible Costs

Cost of the biometrics scanner


Training cost
Cost of Computer
Cost of LAN Cables
Cost for System Development
Costs for Maintenance
Salary Costs
Cost for Router

Intangible costs

Unproductive workers while coping up with changes


Inefficient work during transition
COTS

Table 9.3: CBA for COTS

Tangible Benefits
105

12% increase in revenue (1st year)


Additional 6% increase revenue (succeeding years)

Intangible Benefits

More accurate data and information


Information can be accessed anytime and anywhere
Customer service improvement
Increase in productivity of employees
Faster process cycle times
Lesser communication errors

Tangible Costs

Installation of SAGE ERP X3


Installation of PrimeTime Biometric System
Maintenance Costs
Files Conversion Costs

Intangible Costs

Opportunity loss during transition stage


Inefficiency of employees during transition stage

9.4

IS Development Five (or Ten)-Year Budget Plan


For the three solutions that the system analysts has proposed which are the

outsourcing of software developer, having the IT Department create the proposed system
and/or purchasing the commercial off-the-shelf software package. Given below is a table
of the summary of costs to be incurred per each alternative.

106

2014

2015

2016

2017

2018

TOTAL

Outsource

287,333.30

11,800.00

12,349.00

12,835.00

13,595.50

337,912.80

IT Dept.

774,711.90

24,624.80

25,074.80

25,658.80

26,420.30

876,491.60

COTS

136,253.00

10,495.25

10,495.25

10,495.25

10,495.25

178,234.00

Table 9.4: Summary of Costs

9.5

Five (or Ten) Year Funding Requirements


The three alternatives entail different costs depending on the requirements for the

new system. It was mentioned in the earlier chapters that the company could get the funds
for this proposal from the profits they earn in their business transactions.

For the outsourcing, the company will need a total of Php 337, 912.80 to fund the
five-year operations of the proposed system. The initial cost for the development of the
system is Php 287, 333.30, which will be spent on the first year of implementation. For
the following years, a sum of Php 11, 800.00 will be spent for operating costs particularly
for maintenance with an increasing 0.03% cost per annum.

The calculated total benefits would amount to P3916493.6 which is derived from
the savings that the company may incur in turnover and increase in 2% sales due to
customer satisfaction. The total development cost of the system is P774711.9 which was
derived from the costs of the biometrics scanner, cost of new computer, cost of router and
LAN cables, and the salary of three additional IT personnel in a 6 month contract. The

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operational cost is P24624.8 annually. The total cost is 879491.6. The return on
investment is 3.46 and the BEP is 9 months and 22 days.

For the COTS, the company will spend Php 178,234.00 for the five-year
operation of the system. The development cost of the proposed COTS will be Php
136,253.00 and the operating cost for four years is Php 41981.00. The operating costs
consist of annual maintenance costs of SAGE (Php 8829.00) and PrimeTime Biometrics
(Php 1666.25).

9.6

Five (or Ten) Year Budgetary Requirements


The budget requirements of the company for the new system depend on the

requirements of the proposed system. Both development and operating costs may vary
per alternative. For the three alternatives, the budget requirements mainly depends on the
total cost computed by the system analysts for the five-year IS plan. For the outsourcing,
the company must have at least Php 337,912.80 to maintain the needs of the system. For
the second option to have the IT department create the system, a minimum of Php 876,
491.60 is required to suffice the budget needs of the new system. And for the COTS, Php
178, 234.00 is needed to be able to meet the maintenance of the software.

9.7

Training Cost
In a company, to have a new system means to have training for the users. Each

alternative proposed has corresponding training requirements in order to fully adopt the
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functions of the new system. However, training for every alternative varies in terms of
costs.
For the first alternative which is to outsource, the training cost would reach Php
153, 120.00. This would mean Php 440.00 per head is the cost for training. 29 employees
will be trained by the software developer particularly the employees under Finance, Sales
and After Sales, Purchasing and Human Resource Departments. 12 days will be spent for
the training of the employees.
For the second alternative, the training cost will reach Php 105, 498.60. This is
quite big compared to the first alternative because the training days will reach 30 days
with 1 hour training allotted per day. The training for the employees in the company will
be executed by the 2 IT professionals of the company since they are the ones who will
create the system.
There will be no training costs for COTS. The SAGE ERP X3 package already
includes training for the users.

Chapter 10 - Design and Implementing Issues


10.1
Data Requirements and Operations
The current system uses the data from finance, sales and after sales, and
purchasing for its operation. The payroll of the employees is also accessible for the
users. The databases will focus on the companys records of their employees,
customers, suppliers, other expenses and supplies and the invoices received from
suppliers and given to customers. The system can provide a comprehensive report
encompassing the data provided by all the company departments. The data of the HR
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department could also be accessed by the finance department for cross-checking of the
reliability data. The system could keep track and control all the sales and expenses
made by the company in each of their transactions. This promotes a smooth flow of
information and thus better productivity for the employees of the company.

10.2
The Proposed System (Automation System)
The proposed system is designed to perform the following functions:
-

Generate a report that encompasses data from all the departments of the company.
Compute HR payroll in connection to the attendance and employee records of the

company.
Use a biometric system to automatically record the log in and log out of the employees
Send the total expenses incurred automatically to finance.
Create a prompt message to notify the finance department of due receivables and

payables
Keep track of inventory of supplies for cars and suppliers for office.
Monitor invoices from suppliers and to customers.
Finance
The finance department has complete access to all the data that the new system
will provide. Compared to the current system, the finance department would have access
to more data as it would have access to the cost and returns of marketings promotional
strategies and to the payroll. The finance department would be able to generate a
comprehensive report that encompasses data from all the departments of the company.
Data of debts due would also be provided to the finance department.

Human Resource

110

The proposed system will include biometrics as a new means to check the
attendance of the employees. The data gathered by the new system will be used to
compute the employee payroll. Furthermore, the computed salary will be added to the
employees commission, overtime pay, and bonuses. Computation for payroll will be
done using the information from the attendance and employee databases.

Sales
The proposed system will record all transactions made with customers. It will also
generate the necessary documents such as the sales order and sales invoices. The system
will also be the one to update and monitor all the databases of the sales department such
as the customer databases. This system will also confirm availability of car parts for
services acquired and for the vehicles to be purchased by the customers.

Purchasing
The proposed system will handle all the companys transactions with its suppliers.
It will also monitor and manage the inventory of supplies for car parts and office
supplies. Any transactions made with suppliers that incur costs will automatically
increase the accounts payable of the company. Necessary documents such as the purchase
invoices and purchase orders are generated by the system as well.
10.3

Proposed Process Flow Diagram

111

Figure 10.1. Proposed System Flowchart Payroll (Attendance and Employees)

112

Figure 10.2 Proposed System Flowchart Sales and After Sales

113

Figure 10.3 Proposed System Flowchart Purchasing

114

Figure 10.4. Proposed System Flowchart Finance Department

115

10.4

ER Diagram

Figure 10.5 ER Diagram

Figure 10.6: Normalization for Purchase Inventory

Figure 10.7: Normalization for Sales Inventory

116

Figure 10.8: Normalization for Payroll

Figure 10.9: Normalization for Service Order

Figure 10.10: Normalization for Sales Order

10.5

Description of the ER Diagram


The ER Diagram shows the relationship of the entities between one another. An
entity should be linked with at least one entity. The ER diagram above shows that the
entity that has the most number of relationships is the Finance being connected to
Purchase Order, Service Order, Sales Order and Payroll. The Customers is needed for
both Sales Order and Service Order. On the other hand, the Suppliers is needed for
Purchase Orders. The Attendance and Employee are used for the Payroll.

10.6

Database Tables (label primary keys)

117

Table 10.1 Suppliers Database

Table 10.2 Customers Database

Table 10.3 Attendance Database

Table 10.4 Car Database

Table 10.5 Car Parts Database

Table 10.6 Employees Database

118

Table 10.7 Finance Database

Table 10.8 Other Expenses Database

Table 10.9 Office Supplies Database

Table 10.10 Payroll Database

Table 10.11 Purchase Invoice Database

Table 10.12 Purchase Order Database

119

Table 10.13 Sales Invoice Databse

Table 10.14 Sales Order Database

Table 10.15 Service Database

10.7

Description of the Tables


Employee Attendance Database
This database contains the name of the employees, time the employees start to
work, as well as the time they leave the company after work. It also shows the dates
when the employees are present. The total amount of time consumed by the employees
is a factor in determining their salary. This database is essential in computing for the
payroll of the employees, which are generated by the system as well.

Employee Payroll Database


This database contains the salary of the employees as well as the rates and time of
their attendance. It computes the total amount of salary the employees will receive. The
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Employee ID or EmpID, being the primary key, is connected to the payroll and to the
attendance and employee records database. This will allow the system to compute and
generate the payroll sheets.
Finance Database
The Finance Database displays the payables, receivables, payroll, and the
transactions that the company incurred. The service code key in the service order
database is connected to the service code of the finance database, which is a summary
of service orders. The payroll also represents the salary expenses that the company has
to compensate.

Supplier Database
This supplier database includes the details about the suppliers or contractors the
company deals with. This provides a list of the suppliers and the corresponding
amounts the company has incurred from the products purchased. The supplier key is
connected to the purchase order, and also with the finance department since they are
responsible for the companys payables.
Customer Database
The customer database contains general information about the customer. This is
connected to the sales invoice, which contains the transactions that transpired between
them and the company. It allows the management to keep track of their sales and
orders coming from the customers.
121

Sales Invoice Database


This database includes a summary of the sales invoice issued by the company.
This also contains the details regarding the orders of customers, thus the primary key is
connected to another database which is the Finance database in order for the Finance
staff to strictly monitor and keep their receivables updated.

10.8

Query Operations
The queries that will be incorporated in the system will permit the user to obtain

certain information according to their requirements and purpose. The system would
generate organized and summarized information based on the query function. Queries
that will be executed and presented in the system are as follows:
a.
b.
c.
d.
e.

Employee Record (Attendance)


Employee Payroll
Accounts Payable
Accounts Receivable
Financial Reports

Employee Record
The query will enable the Human Resource staff to keep track of the daily
attendance of the employees. The time the employee starts working and the time they end
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will be displayed in a list form for a better viewing. This will also show the profile of the
employees, which contains personal information regarding each individual. This would
be essential in determining the absenteeism rates of the employees; likewise will be
utilized in order to generate Human Resource reports.

Employee Payroll
This presents a summarized form and details of the payroll sheets of the
employees. It determines the corresponding rates for the computation of salaries.
Furthermore, respective commissions will also be displayed to provide for the necessary
adjustments.

Accounts Payable
This query will allow the management especially the Finance Department staff to
monitor the list of the accounts of their suppliers or contractors. This will show the dates
when the accounts are due. With this they can effectively accomplish all their liabilities
before the due dates.

Accounts Receivable
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The accounts receivable query permits the Finance staffs to keep track of their
receivables. A list of their clients will be displayed, together with their corresponding
accounts. This is necessary to enable the system to generate alert messages, and let the
user decide which client to email for a follow up.

Financial Reports
This query will provide comprehensive reports for departments such as Finance,
Sales, and Human Resource, which may be viewed by the users. They are given the
option to select the date or time period for the reports that they requested. Users may also
ask for a recently updated report, which the system is also able to generate.

10.9

List of Application Program


124

Figure 10.11

Login Interface

The system incorporates a login page, which requires the username and password for users to
gain access. It is restricted for Chevrolet North Edsas management and employees. Each of them will be
given by the IT Department a unique username and password to be able to access the system. This serves
as an approach to regulate and monitor the people who enter and acquires confidential information stored
and generated by the system.

125

Figure 10.12

Home Page Interface

The systems Home Page allows the users to select which departments database to enter. It is
divided into 4 categories namely Human Resource, Sales, Purchasing, and Finance, each representing the
4 departments the system caters to. Users may choose among different records or accounts they would
want to enter to, and the buttons will lead them to each respectively. Consequently, once the user decides
to return back to the Home Page, a Home button is located in the upper left portion of all interfaces. Here,
the user may also choose to Logout and exit the system.

126

Figure 10.13 Human Resource Employee Record Interface


The figure above shows the interface for Employee Record. Basic information is displayed
regarding the employee. They are provided with Employee ID numbers, and bank accounts are saved in
order for the HR staffs to deposit the salaries of the employees appropriately. Users may Add New Record
and Save Record whenever they edit the details. The form may also be printed out for other purposes. By
clicking on the Next and Previous icons, users will be able to view other employee records.

127

Figure 10.14 Human Resource Employee Attendance Interface


Currently, the human resource department relies on manual attendance checking. With the new
proposed Biometrics System, the system will be able to efficiently track the attendance of the employees.
HR staffs will have the chance to select from various options such as, simply view the employees
attendance, or print them for reference. The action button on the lower right of the interface allows the
user to move to the previous and next employee records. The data gathered by the new system will be
used to compute the employee payroll.

128

Figure 10.15

HR Employee Payroll Interface

Upon gathering information from the Biometrics System, employees attendance will be
automatically recorded in the system. After which, the payroll sheet of the particular employee will be
generated. HR Staff may also input certain numbers or details on the payroll forms since employees have
distinctive rates and commissions that have to be accounted for in their total salary. The Save Record
button enables the staff to save and update the payroll form once he/she has already finished adjusting the
accounts. The search button for Employee ID on the upper right will lead the user to other employees
payroll sheets according to the ID entered. Lastly, payroll sheets may be printed at any time especially
during distribution of salaries.

129

Figure 10.16

Sales Department Customer Record Interface

Customer Record interface displays the list of customers with their corresponding contacts and
information. The customers are also assigned a unique ID, which will be used in creating sales order,
sales invoice, and whenever they avail of the companys service and maintenance.

The sales staff

may simply input new customer entity and save his/her record. They may also choose to print the list for
reference.

130

Figure 10.17

Sales Order Interface

The Sales Order form of the system enables the companys Sales Department to generate Sales
Order forms automatically. Each form created will be assigned a number in order to effectively keep track
of the several order forms. On the lower left portion of the interface, users will also be able to search or
select other forms they would wish to view. The staff may add new record, save edited records, and print
the forms.

131

Figure 10.18 Sales Invoice Interface


The Sales Invoice Interface shows the form the company may use in issuing sales invoice to
customers. New records will be assigned a particular number, and may be counter-checked in the
corresponding sales order. This will ensure the accuracy of amount that will be charged, which will be
based according to the details provided in the sales order form. The user may also search for other sales
invoice record using the control on the lower left corner, or simply browse through other forms using the
arrow buttons. Car ID and Service ID represent the specifics of the car purchased, and the services
incurred by the customer respectively.

132

Figure 10.19 Service Order Interface


The system is also able to generate service order forms specifically for the repair and
maintenance service the company offers. The service department staff may use this in monitoring aftersales services availed by customers. Similarly, it is also given a number to easily track the transactions.
The user may edit the form and then save it, or add new record, and lastly print the service order forms.
The item ID represents the car parts and products that will be used for particular service types. This will
automatically decrease the level of inventory recorded in the inventory database within the system.

133

Figure 10.20 Supplier Record Interface


The figure above shows the list of suppliers that the company transacts with. It contains the name
address, contact details, and supplier ID assigned to each entry. This is essential for the Purchasing
Department to effectively document previous and new suppliers. They may add new details at any time
and print them as well.

134

Figure 10.21 Purchase Order Interface


The Purchase Order form of the system enables the companys Purchasing Department to
generate forms automatically. Each form created will be assigned a number in order to effectively keep
track of the several order forms. On the lower left portion of the interface, users will also be able to search
or select other forms they would wish to view. The staff may add new record, save edited records, and
print the forms. Car ID represents the car the company would acquire, and OfficesuppliesID are the other
materials used for administrative purposes.

135

Figure 10.22 Purchase Invoice Interface


The Purchase Invoice Interface shows the form the company may use in issuing purchase invoice
to suppliers. New records will be assigned a particular number, and may be counter-checked in the
corresponding purchase order form. This will allow the users to counter check the quantity and amount of
the orders they placed. The user may also search for other purchase invoice record using the control on
the lower left corner, or simply browse through other forms using the arrow buttons. Car ID and
CarPartsID represent the specifics of the car purchased, and the parts installed during repair and
maintenance respectively.

136

Figure 10.23 Inventory Interface


The figure above indicates the level of inventory the company currently holds. The user may
select which among Car, Car Parts, and Office Supplies Inventory they would like to view and to update.
All particular details of the products are well-listed, and may be printed out for other purposes. Once the
products are recorded in both sales order, and purchase order, the quantity will decrease correspondingly.

137

Figure 10.24 Finance Department Receivables Interface


Looking at the figure shown above, the interface displays a comprehensive list of the companys
receivables. The update button enables the system to gather new data and information from the other
section of the system, and accumulate them in a new form. Then, they will have the option to print the
form for other purposes. Moreover, alert boxes will pop-out once receivables that are past the due date are
not yet processed. The employee shall send an electronic mail to the members that need to be prompted
regarding their unsettled accounts. This exclusive feature of the system supports the company, particularly
the finance department to manage their financial accounts more effectively.

138

Figure 10.25 Finance Department Payables Interface


Looking at the figure shown above, the interface displays a comprehensive list of the companys
payables. The update button enables the system to gather new data and information from the other section
of the system, and accumulate them in a new form. Then, they will have the option to print the form for
other purposes. Moreover, alert boxes will pop-out once accounts that are past the due date are not yet
processed. All the companys purchases will be compiled here in the list of payables. This exclusive
feature of the system supports the company, particularly the finance department to manage their financial
accounts more effectively.

139

Chapter 11 - Testing and Debugging


Testing and debugging are crucial parts in a systems life. These two processes ensure
that the system will work effectively and efficiently with compliance of the companys
requirements. There are different steps of testing that the company should do in order to discern
the things that are needed to be changed and once those things are determined, the IT personnel
have to debug the system to make it compatible with the companys processes.
Testing
The first test that the company should do upon the implementation of the system is
function testing. Function testing is done to check if the system performs the functional
requirements that are specified by the company. The is important for the reason that after this test
is made, the company would know if the system is right for the business and works just like how
they want it to be. If the system failed in the function testing, the company has to debug the
system or worst, they will not be able to use it.

A system should not only perform the functions that the company needed for their
process but also create a feasible output that the company can use, hence, the second test that has
to be made is performance testing. In this test, the integrated module will be compared with the
non-functional requirements that include security, accuracy, speed and reliability. All the input
data in the system must be well-secured and must not be easily accessed by unauthorized
personnel. The output from the system should be accurate and reliable because the company will
use the output to know which decision should be made in order to get the highest profitability. T

140

The third test the company should make is the acceptance testing. In this test, the
systems characteristics will be checked to guarantee that they are in acquiescence with the
requirements given by the company. This will assure the company that the system is compatible
with the processes and constraints they defined.

The last test is implementation testing. In this test, the users will be the ones to try the
system and evaluate it if they can work with it or not. One of the important factors upon the
implementation is the accessibility of the system. The users must know and understand the
features of the system and the processes they have to do in order to get the output that the
company needs. The users will also be able to document and check the errors they encountered
during the testing and can use in the future.

Debugging
The alteration and checking of processes during the testing is called debugging. This is
the process wherein the programmers and consultants correct errors by editing and creating new
codes that could make the system better. It is usually hard to debug a system because the ones
that will debug it are also the ones who created the system, which makes it harder for them to
determine the errors that they have correct. The programmers also need to determine where the
error is coming from before being to create new codes for the system. After fixing all the errors
found, the programmers have to create a user manual that would discuss the steps and processes
that the user have to do in case an error will occur again. The user manual will also help the users

141

to be able to understand the processes in the system and they could also use it to guide them
throughout the implementation.

Chapter 12 - Conclusion and Recommendation


Calebs View Automotive Inc was established in 2012. In the same year, the company
was able to get a franchise of Chevrolet and they opened a branch in Balintawak. The company
also offers services and maintenance for all the brand of cars. The companys growth has been
extremely favorable for them but there are also problems that they are facing because of this
growth. The companys system cannot fully accommodate all the functions that the company
wants to have and because of that, the company incurs a lot of losses. Though the company is
already using the ERIC system for their sales, finance and after-sales department, the ERIC
system cannot accommodate the processes that the HR and marketing department needs.

Upon evaluation, the analysts found out that most of the problems are from the
departments that are still doing processes manually. The marketing department is having a hard
time in organizing events and creating new ways in promoting the cars which is causing them to
lose some sales and prospect customers. Another problem is that the slow processing of payroll,
it is handled by the HR department and because of some factors that affect the computation of
the salary of employees one of which is attendance they are having problems computing it
because of the inconsistency of the data they have. After all the evaluation has been done, the
analysts decided to create three alternatives that the company can use to solve these problems:
(1) a customized system that the IT department will create that will make the processes in
142

marketing and HR automated linked with ERIC; (2) outsourcing the system proposed; and (3)
buying COTS that matches most of the needs of the company.

The analysts then evaluated the feasibility of the systems considering the effects of each
alternative in the current operation of the company. The feasibility matrix below discusses the
feasibility of the system in four areas: operational, technical, economic, and schedule.

FEASIBILITY
CRITERIA

Operational
Feasibility

40%

CUSTOMIZED
SYSTEM:
OUTSOURCE
SOFTWARE
DEVELOPER

CUSTOMIZED
SYSTEM: INHOUSE IT
DEPARTMENT

The company would


hire
an
outside
software development
company to create the
customized system.

The company would


order their own IT
department to make
the
customized
system
through
overtime.

SAGE ERP system


will be able to
accommodate most
of the concerns of
the
company
because it has a lot
of features.

The design of the


customized system is
user-friendly, thus the
employees
of
Chevrolet
North
EDSA would not
have any hard time
using the system.

The company can


also add features
they want the
system to have.

The design of the


customized system is
user-friendly, thus the
employees
of
Chevrolet
North
EDSA would not have
any hard time using
the system.

The IT professionals
from the outsourced
software
company
could help in the
improvement of the

COTS

The system can be


easily understood
because
it
is
integrated
with
The maintenance and Microsoft
word
debugging, even the office.
improvements would
143

proposed system since


they have more broad
knowledge regarding
information systems.

The maintenance of
the system would also
be done by the
software
company,
which means that the
in-house
IT
department
would
have more time to do
their jobs inside the
company.

be performed by the
companys in-house
IT department. Which
makes
the
dissemination
of
information easier

The disadvantage of
this is that there will
be no fresh ideas
from external teams
and there will be no
external team to
check if the system
has anomalies.

Score: 95

Another
disadvantage
is
that the system has
features that are
not needed by the
company.

The
adaptation
process of the
employees to the
system continues
even after the
implementation
stage because the
system
is
not
business oriented.
The
employees
might
encounter
problem
during
operations
that
could affect their
output.

The disadvantage of
this alternative is the
difficulty
of
communication
between the company
and
the
software
provider.

SCORE:

The disadvantage
of this is system is
the
company
should adapt in the
format
of
the
system.

Score: 94

Score: 90
144

Technical
Feasibility
30%

There isnt too much


hardware requirements
for the new system.
The present hardware
of the company could
actually accommodate
almost
all
the
requirements of the
customized
system
except
for
the
biometrics.
The
company needs to
purchase one to be
able
to
fully
implement the new
system.

The average price of


the biometric system
is mentioned already
by
the
system
analysts. However, it
is still the decision of
the
company
to
whether or not follow
the suggestions of the
system
analysts
regarding
the
hardware requirements
because they could
also
canvass
the
hardware brands and
prices on their own.
The important factor is
that the hardware to be
purchased should be
able to meet at least
the standards of the
requirements of the

There isnt too much


hardware
requirements for the
new system. The
present hardware of
the company could
actually
accommodate almost
all the requirements
of the customized
system except for the
biometrics.
The
company needs to
purchase one to be
able
to
fully
implement the new
system.

The average price of


the biometric system
is mentioned already
by
the
system
analysts. However, it
is still the decision of
the
company
to
whether or not follow
the suggestions of the
system
analysts
regarding
the
hardware
requirements because
they
could
also
canvass the hardware
brands and prices on
their own.

The
hardware
required in order to
use the new system
are already in the
company.
The
system does not
need a lot of new
hardware.

The
biometrics
system that the
company should
buy is that is very
compatible with it
which
is
PrimeTime
Biometrics system.

Other
materials
needed for the
operation of the
new system will be
provided by SAGE
(i.e., cables).

145

customized system.
SCORE:

Score: 98

Economic
Feasibility

20%

Score: 98

Score: 92

For outsourcing, the The total cost that


total costs to be would be incurred in
incurred
by
the using the companys
company would be own IT department to
P287, 333.30.
create the system is
P774, 711.90

The total cost that


the company has to
spend for the
implementation of
the system is P146,
748.25.

Other
important
factors to consider are: Other
important
factors to consider
ROI: 10.59
are:

Other important
factors to be
considered are:

Breakeven:
months

3.56 ROI: 3.47


Breakeven:
months

ROI: 9.89
9.74

Breakeven: 4.13
months

SCORE:

Score: 96

Score: 92

Score: 90

Schedule

The new system


would be fully
operational in the
company after 81 days

The new system


would be fully
operational in the
company after 160
days

The SAGE ERP


X3 would be fully
operational in the
company after 31
days.

Score: 94

Score: 91

Score: 96

Score: 96

Score: 93.75

Score: 91.2

Feasibility

10%

SCORE:
RANKING:

100%

Table 12.1 Feasibility Matrix

Alternative 1

Costs

Time of Completion

P287, 333.30

81 days

Customized System:
146

Outsource Software Programmer


Alternative 2

P774, 711.90

160 days

Customized System:
In-House IT Department
Alternative 3

P146, 748.25. 31 days

Purchased COTS
(SAGE ERP X3)
Table 12.2 Summary of the Feasibility Matrix
After the analysis of the feasibility matrix, the analysts concluded that the best among the
alternatives is to outsource the system.

In the operational feasibility, the analysts gave outsource and in-house system both 98
and gave COTS 92 as a rating. This shows that in terms of how the operations of the company
after the implementation of the system change will be mostly positive if the company uses the
outsourced or in-house system. Considering that the proposed system will be that of the
company, the users of the system will have easier time to understand and process the things
needed for the output they have to do. The analysts also considered the productivity of the
employees during the implementation of the system showing that if the company chooses inhouse, the IT department will be not be productive because they have to focus on the creation of
the system. On the other hand, if the company chooses outsource, the operations of the company
will not be affected during the implementation. The COTS is given the least rating due to the
147

reason that the system will not be maximized by the company because of the features that cannot
be used or not needed by the company.

All the proposed alternatives do not require a lot of materials or equipments needed by to
the company to implement the program. The similarity of the three alternatives is the need of the
biometrics. The low rating for the COTS is the cost of the biometrics needed for implementation
of SAGE. The PrimeTime Biometric system which is the prescribed biometric for sage cause
more than 5 times than the biometric system that the company has to purchase for the in-house
and outsource system.

The analysts computed the costs of the three alternatives. The most expensive alternative
is the in-house system which will cost the company more than P770, 000, the second is the
outsourcing which is for more than P280000, and the least expensive is the COTS which costs
more than P140, 000.
In terms of scheduling, the best alternative is the COTS with a completion time of 41
days. If the company already needs a system and they could not wait for the completion of inhouse or outsource system, they should choose the COTS. The second best in terms of
scheduling is the outsource system and the least alternative is the in-house system.
The analysts and the company want a system that could accommodate all the functions
that the company needs and making it as business-oriented and considering all the results in the

148

feasibility analysis test, the suggested and the best alternative for Chevrolet-Balintawak is to
outsource the system.

List of Appendices
Appendix A: Inventory of Existing Hardware and Software
1. Hardware
Estimated Projected
Hardware
Computer

Qty
25

Type of Equipment
Intel
Computer

age
Desktop 2

Location
life
8 years

Departmental

offices

(for employee users);


149

Intel
Server

25

Core

i5

3470

Owners office

3.2Ghz- Asus H61M- A


IBM System x3100 M4 2

6 years

Server
Xeon

Departmental

offices

(for employee users);


4C

E31220v2

Owners office

80W
Printer

Intel C202
Epson M100

4 years

Departmental

offices;

Photocopying

RiCoH Imagio Neo 220 3

6 years

Owners office
Departmental offices

machines
Projector
Telephone

1
13

Infocus IN112
2
Panasonic
telephone 3

5 years
8 years

Owners office
Departmental offices;

Hardware
Computer
Printer
Photocopy
Projector
Telephone

unit with speaker phone

Owners

KX-T7716

Customer Lounge

User
Employees; Top Management
Employees; Top Management
Employees; Top Management
Employees; Top Management
Employees;
Top

Status
In operation
In operation
In operation
In operation
In operation

office,

Financial arrangement
Owned
Owned
Owned
Owned
Owned

Management; Customers
2. Software
ERIC SYSTEM

This is used by the company for the sales, after


sales and finance functions.

MICROSOFT OFFICE 2007

This is used by the company to record various


transactions. Microsoft Excel is the most used
program in this Microsoft Office 2007.

150

Appendix B: Existing Hardware in the Company (images)


Figure Appendix B.1 Computer

Figure Appendix B.2 Server

151

Figure Appendix B.3 Printer

Figure Appendix B.4 Photocopying machine


152

Figure Appendix B.5 Projector

Figure Appendix B.6 Telephone

153

Appendix C: Glossary of Terms


Application Server Provider

A third party entity that provides software-based


solutions to customers across wide area network

Architecture

Summary of how the work system operates

Automation

Use of various control systems for operating equipment


with minimal or reduced human intervention.

Biometrics

Measurement and analysis of unique physical


characteristics especially as a means of verifying
personal identity.

Breakeven Analysis

Balance between making either a profit or a loss

Commercial Off-the-Shelf

Commercially available and can be bought as is

Data Dictionary

Refers to metadata

Data Flow Diagram

Diagram that shows the flow of data from various


processes, entities and data stores

Database

Collection and storage of data that is organized and used


on a computer

Debugging

Reducing the bugs and errors in a various system


154

Entity Relation Diagram

Data model that describes data and information and its


relation to entities

ERIC System

The current system used by the company

Feasibility

Study of the proposed system with regards to its


technical, operational, economical and schedule aspects

Gantt Chart

Chart used to track the projects and the date of


accomplishment of each tasks

Graphical User Interface

An interface that allows the user to interact with


electronically devices

Information System

A combination of hardware, software, infrastructure and


trained personnel organized to
facilitate planning, control, coordination, and decision
making in an organization.

Outsourcing

To procure (some goods or services) under contract with

Process Flow Diagram

an outside supplier
A schematic illustration or visual presentation of the
steps or processes in a system

Queries

Computer languages used to make queries for


information systems

System Analyst

Searches problems, plans solutions, recommends


software and systems, at least at the functional level, and
coordinates development to desired company

System

An organized or established procedure or method; A


group of interdependent systems that work together to
perform a certain task

155

Appendix D: Pictures of the Groups Data Gathering

156

157

Appendix E: Interview Transcription


1. System analysts: Based on our previous study sir, the company already has an existing
system-The ERIC, what is the scope of the functions of ERIC?
Chevrolet North EDSA: Well, the ERIC handles operations in the sales, after sales, and
finance. Meaning every time a sale is generated, it would automatically reflect on the
financial reports that the ERIC could generate. In after sales naman, every time na may
magpapaservice the amount of that service reflects on the ERIC as well.

2. System analysts: Sir, how about the functions of other departments such as HR?
Chevrolet North EDSA: Wala pa kaming system that handles the functions of marketing
and promotion, HR, and the like.
158

3. System analyst: So, in the HR how is the attendance being checked and how is the
payroll computed?
Chevrolet North EDSA: Manual checking of attendance and the computation is made
through Excel.

4. System analyst: Sir, sorry, what do you mean by manual checking? A tally sheet of
attendance?
Chevrolet North EDSA: In the HR department, there is an assigned attendance checker,
the checker then checks the department one by one to see who is not yet around by 8pm
and who already left before 5pm.

5. System analyst: Thank you sir, well keep you posted regarding the development of this
project
Chevrolet North EDSA: Sure, if you need anything contact me through e mail.

159

Appendix F: Letter of Certification

160

Appendix G: Related Information

161

Magkilat, B. (2013). Auto industry targetd 10% increase in sales in 2014. Retrieved August 8,
2014 from, http://www.mb.com.ph/auto-industry-targets-10-increase-in-sales-in-2014/.

Pornelos, V. (2014). Combined PH Auto Sales May 2014: Strong growth continues. Retrieved
August 8, 2014 from, http://www.autoindustriya.com/auto-industry-news/combined-phauto-industry-sales-may-2014-strong-growth-continues.html.

Appendix H: Forms and Other Documents


162

Figure Appendix H.1 Official Pricelist

Figure Appendix H.2: Gross Profit Analysis


163

Figure Appendix H.3: Auto Loan Application


164

Figure Appendix H.4: Vehicle Acceptance Checklist


165

Figure Appendix H.5: Vehicle Sales Order


166

Figure Appendix H.6: Securities and Exchange Commission Registration


167

168

169

Figure Appendix H.7: Vehicle Gate Pass

Figure Appendix H.8: Vehicle Purchase Order


170

Figure Appendix H.10: Purchase Order of Computer Acquisition


171

Figure Appendix H.11: Purchase Order of Server Acquisition

172

Appendix I: Hardware Requirements of the Proposed System


173

Figure Appendix I.1 Additional Computer

Figure Appendix I.2 Router

Figure Appendix I.3 LAN Cables


174

Figure Appendix I.4 Biometric Scanner

Bibliography
175

Information System. (2014). In BusinessDictionary.com. Retrieved August 10, 2014 from,


http://www.businessdictionary.com/definition/information-system.html.

Magkilat, B. (2013). Auto industry targetd 10% increase in sales in 2014. Retrieved August 8,
2014 from, http://www.mb.com.ph/auto-industry-targets-10-increase-in-sales-in-2014/.

Pornelos, V. (2014). Combined PH Auto Sales May 2014: Strong growth continues. Retrieved
August 8, 2014 from, http://www.autoindustriya.com/auto-industry-news/combined-phauto-industry-sales-may-2014-strong-growth-continues.html.

System. (2014). In Webopedia. Retrieved August 10, 2014 from,


http://www.webopedia.com/sgsearch/results?cx=partner-pub8768004398756183%3A6766915980&cof=FORID%3A10&ie=UTF-8&q=system.

176