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Feasibility Analysis

Martha Grabowski LeMoyne College

Feasibility
Measure of how beneficial or practical the development of an information system will be to an organization. Feasibility Analysis
Process by which feasibility is measured

Continuing process of feasibility assessment

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Whitten, Bentley & Dittman 2001, Chapter 9

Tests of Feasibility
Operational Feasibility Technical Feasibility Schedule Feasibility Economic Feasibility

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Whitten, Bentley & Dittman 2001, Chapter 9

Tests of Feasibility
Operational Feasibility
How well will the solution work in the

organization?

Technical Feasibility
How practical is the technical solution?

How available are technical resources and expertise?

3/18/2014

Whitten, Bentley & Dittman 2001, Chapter 9

Tests of Feasibility
Schedule Feasibility
How reasonable is the project timetable?

Economic Feasibility
How cost-effective is the project or

solution? Cost-benefit analysis

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Whitten, Bentley & Dittman 2001, Chapter 9

Operational Feasibility
Questions to Ask
Is the problem worth solving?

Will the solution to the problem work? How do end users and management feel about the solution?

Has a usability analysis been conducted?

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Whitten, Bentley & Dittman 2001, Chapter 9

Technical Feasibility
Questions to Ask

Is the proposed solution practical?


Do we possess the necessary technology? Do we possess the necessary technical expertise?

Is the schedule reasonable?

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Whitten, Bentley & Dittman 2001, Chapter 9

Economic Feasibility
Cost-benefit analyses

How much will the system cost?


Development costs Operation costs Maintenance and support costs

Do we possess the necessary technology? Do we possess the necessary technical expertise? Is the schedule reasonable?
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Whitten, Bentley & Dittman 2001, Chapter 9

Cost Analysis
Project Budget Template
Author's Name Assumptions Personnel/Infrastructure assumptions Infrastructure assumptions --Initial network and remote access upgrades covered in ZYX project Programmatic assumptions --Budget currently contains expenses only --Revenues to be estimated upon completion of market survey Worksheet and expense assumptions --Average manager salary (2002$$) --Annual expense increase --Benefits and indirect costs changes per year --Benefits (as a percentage of wages) Expenses Personnel Benefits (at 32%) Hardware Software Computer Usage Costs Training Costs Library Resources Program Maintenance and Upgrade Costs Travel Costs Administrative Costs Administration Postage, Fedex Communications Publication costs Total Administrative Costs Total Direct Cost Indirect Costs (at 54.5%) Yearly Project Costs Year 1 Year 2 Year 3 Organization Name, Date

$75,000 3% 0% 32% Year 4 Year 5

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Whitten, Bentley & Dittman 2001, Chapter 9

Benefit Analysis
Benefit analyses

Tangible benefits can be easily quantified.


Measured in terms of monthly or annual savings, or of profit to organization Intangible benefits more difficult to quantify.

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Benefit Analysis
Tangible Benefits Fewer processing errors Increased throughput Decreased response time Elimination of job steps Increased sales Reduced credit losses Reduced expenses Intangible Benefits Improved customer goodwill Improved employee morale Better service to community Better decision-making

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Economic Feasibility
Payback analysis

How long will it take to recoup the costs of this project?


Return on investment (ROI) analysis Net present value analysis

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Feasibility Analysis
Compare candidate systems on basis of several characteristics Better analysts always consider multiple solutions

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Candidate Systems Matrix


Candidate Systems Matrix Characteristics Portion of System Computerized Brief description of portion of system that would be computerized in this candidate. Benefits Brief description of business benefits that would be realized for this candidate Servers and Workstations Description of the servers and workstations needed to support this candidate. Software Tools Needed Software tools needed to design and build the candidate solution (e.g., DBMS, operating systems, languages) Application Software Description of software to be built, purchased, accessed or some combination of the above. Method of Data Processing On-line, batch, deferred batch, real-time Output Devices and Implications Output devices that would be used (e.g., network, preprinted forms, etc.) as well as output considerations (timing constraints) Input Devices and Implications Description of input methods to be used (e.g., keyboard, mouse, etc.), special input requirements (new or revised forms), input considerations (timing of actual inputs) Storage Devices and Implications Description of what data would be stored, what data would be accessed from existing stores, what storage media would be used, how much storage capacity needed, how that data would be organized. Candidate 1
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Candidate 2 Candidate 3

COTS package Platinum Plus from Entertainment Solutions, Inc. Solution can be implemented quickly.

PIV, MS Windows 2000 class servers and workstations

MS Visual C++ MS Access for customization of package for report writing. Package solution

Client-server

HP4MV dept laser printers

keyboard & mouse

MS SQL DBMS with 100G arrayed capability

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Whitten, Bentley & Dittman 2001, Chapter 9

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Feasibility Analysis Matrix


Feasibility Analysis Feasibility Criteria Operational Feasibility Functionality: To what degree does the candidate solution benefit the organization? Political: How well will the solution be received by users? Management? Weight 30% Only supports Fully supports Members Services required requirements and functionality current business processes would have to be modified Score: 60 Score: 100 30% Current release of Current technical Platinum Plus is staff only has 1.0; only on market Powerbuilder 6 weeks experience. Staff thinks Access app is simple. Score: 50 Score: 95 30% $350,000 $418,040 $400,000 4.5 years 3.5 years 3.3 years $210,000 $306,748 $325,500 See attachment A See Attachment A See Attachment A Score: 60 Schedule Feasibility Assessment of how long the solution will take to design and implement. 10% Less than 3 months Score: 95 Ranking 3/18/2014 9-12 months Score: 80 9 months Score: 85 83.5 Score: 85 Score: 90 Same as Candidate #2 Candidate 1 Candidate 2
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Candidate 3

Score: 100

Technical Feasibility Technology: Assessment of maturity, availability, ability to acquire, and desirability of computer technology needed to support the candidate. Expertise: Assessment of the technical expertise needed to develop, operate, and maintain the candidate system Economic Feasibility Cost to Develop Payback period (discounted) Net Present Value Detailed Calculations

Score: 60

Whitten, Bentley & Dittman 2001, 60.5 92 Chapter 9

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