Systems Analysis and Design Chapter- 3

Chapter 3 : Systems Planning and Selection

- Project Identification and Selection

- Project Initiation and Planning
- Feasibility Study
- Building the Baseline Project Plan
- Reviewing the Baseline Project Plan
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Systems Planning and Selection

This first phase of the systems development life cycle deals with
the process of identifying, selecting, initiating, planning projects
and assessing project feasibility.

3.1 Project Identification and Selection

The first step is to identify the need for a system, which can
be the result of
o Problems in existing system or process
o New feature required in an existing system
o A new idea for which in Information System is required
o A requirement to improve efficiency in the organization
o Compulsory standards or bench marks by an external
organization Ex. Government
o The need to keep up with competitors

During this activity a senior manager, a business group, an

Information System manager or a steering committee
identifies and assess all possible systems development
projects, which are all may yield significant organizational
benefits.

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Figure -1 : Key Sources for IS projects

The requests for developing information system can come

from three key sources

 Managers and business units who want to replace or

extend and existing system in order to gain needed
information or to provide a new service to customers.
 Information Systems mangers who want to make a
system more efficient, less costly to operate or want to
move a system to a new operating environment.
 Formal planning group that want to improve an existing
system in order to help the organization meet its
corporate objectives, such as providing better customer
service.

The Selection Process may vary in different organizations,

but the general process is discussed below.

General Process of Identifying and Selection Information

Systems development Projects

Process of identifying and selection consists of three

activities : Identifying potential development projects,
classifying and ranking projects and selecting projects for
development

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Identifying potential development projects: This process may

be performed by a key member of top management, or a
steering committee composed of a cross section managers, or
User departments, or the development group

Projects identified by top management have a strategic

organizational focus, by the steering committees have a
cross functional focus, by the individual departments have a
narrow, tactical focus. The development group identifies
projects based on the ease with existing hardware and
systems.

Hence, projects may be identified by both top-down and

bottom-up initiatives.

The systems analyst should support these groups, to describe

their information needs.
Classifying and ranking IS development projects: Done by
top managers, a steering committee, business units or the IS
development group.

The criteria commonly used to evaluate projects are

 Value chain analysis: Extent to which activities add
greatest benefits
 Strategic alignment: Extent the projects achieves the
long term goals
 Potential benefits: Extent to which the project helps to
improve profits,
Customer service, etc and the duration of
the benefits
 Resource availability: Amount and type of resources
required for the
project

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 Project size / duration: Number of individuals and

duration to complete
 Technical difficulty / risk: Level of technical difficult to
complete.

Selecting IS development Project: The short and long term

projects most likely to achieve the business objectives are
considered.

As business conditions change over time, the relative

importance of any single project may change.

Figure – 2 : Factors to be considered during the project selection

The factors must be considered when selecting a project are

 Perceived needs of the organization
 Existing systems and ongoing projects
 Resource availability
 Evaluation criteria
 Current business conditions
 Perspective of the decision makers

Deliverables and outcomes

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The primary deliverable or end product form the project

identification and selection phase is a schedule of specific IS
development projects.
These projects may come from both top down and bottom up
sources
The selected project move into the second activity called
Project initiation and planning

Figure-3 : Deliverables from Project Identification and selection

phase

3.2 Project Initiation and Planning

 The objective of project initiation and planning is to

transform a vague system requirements into a tangible project
description
 Proper project initiation and planning can reduce the time
consumption of further phases
 Activities performed in this phase could also be completed
during the next phase, System analysis
 A rule of thumb is that 10 – 20 % of the entire effort should
be expended in this phase

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General Process of Initiating and Planning Systems

development Projects

 Project Initiation focuses on activities that will help to

organize a team to conduct project planning
 During initiation, one or more analysts are assigned to work
with a customer to establish work standards and
communication procedures.
 Project Planning focuses on defining clear, discrete tasks
and the work needed to complete each task
 The objective of the project planning is to produce two
documents : a Baseline Project Plan (BPP) and the
Statement of Work (SOW).

Figure-4 : Statement of Work – an example

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 The BPP is an internal document used by the development

team but not shared with customers
 The BPP contains all information collected and analyzed
during the project initiation and planning activity.
 The BPP reflects the best estimate of the project’s scope,
benefits, costs, risks and resource requirements.
 The BPP specifies detailed project activities for the next life
cycle phase- Systems analysis and less detail for subsequent
phases.
 The SOW is a short document prepared for the customers
that describes what the project will deliver and outlines all
work required to complete the project
 The SOW is a useful communication tool that assures that
both system analysts and customers have a common
understanding of the project.

3.3 Feasibility Study

 Most Information System projects have budgets and

deadlines, the analysis of factors for feasibility forms the
business case (analysis of the assumptions like resource
availability and potential problems and system cost and
benefits) that justifies the expenditure of the resources on the
project. The feasibility factors are in six categories
 Economic Feasibility
- Concerned with assessing the financial benefits and
costs associated with the project. To do this, it is
necessary to quantify the monetary value of the costs
and benefits of the project. This is also called a cost-
benefit analysis.
- Benefits and costs can be tangible or intangible
- Tangibles are items which can be quantified in
monetary terms and with certainty. Ex. equipment
costs, staff/personnel costs, materials costs, conversion
costs, training costs.

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- Intangibles are items for which a value cannot be

precisely determined, and where the value may be the
result of subjective judgment. Ex. Customer goodwill,
employee morale. Operational efficiency
- The sum value of all costs identified for the project
gives the cost of the system
- The sum value of all the benefits identified for the
project gives the benefit of the systems
- These are then used to determine if the project is
economically feasible. There are two methods for doing
this are work sheet method and present value
method
 Operational Feasibility
- This process examines whether the new project will
attain its desired objectives.
- The goal of this study is to understand the degree to
which the proposed system will likely solve the
business problems or take advantage of the
opportunities specified in the Systems requirement
documents.
 Technical Feasibility
- The goal of this study is to understand the
organization’s ability to construct the proposed system.
- This analysis also includes an assessment of the
development group’s understanding of the possible
target hardware, software and operating environments
as well as the size, complexity and the group’s
experience with similar systems
 Schedule Feasibility
- The process of assessing the degree to which the
potential time frame and completion dates for all major
activities within a project meet organizational deadlines
and constraints for affecting change.
 Legal and Contractual Feasibility

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- The process of assessing potential legal and contractual

ramification due to the construction of a system
- Considerations may include copyright or nondisclosure
violation, labor laws, antitrust legislation, foreign trade
regulations and financial reporting standards as well as
current or pending contractual obligations.
 Political Feasibility
- The process of evaluating how key stakeholders within
the organization
view the proposed system

3.4 Building the Baseline Project Plan

o All the information collected during project initiation and

planning is collected and organized into a document called
the Baseline Project Plan.
o Once the BPP is completed, a formal review of the project
can be conducted with customers.
o BPP contains four major sections
1. Introduction
2. System Description
3. Feasibility assessment
4. Management issues
o Introduction section provides a brief overview of the entire
document and outline a recommended course of action for
the project
o It provides an executive summary that specifies the project’s
scope, feasibility, justification, resource requirements and
schedules. Additionally, a brief statement of the problem, the
environment in which the system is to be implemented and
constraints that affect the project are provided
o Recommendation provides a summary of important findings
from the planning process and recommendations for
subsequent activities

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o System Description section provides a list of alternatives

system configuration
o It provides a description of the selected configuration and a
narrative of input information, tasks performed and resultant
information
o Feasibility Assessment outlines project costs and benefits
and technical difficulties. High level project schedules are
specified using PERT and Gantt charts. The greatest amount
of project planning effort is typically expended on feasibility
assessment activities.
o Management Issues
- Team Configuration and Management: Provides a
description of the team member roles and reporting
relationships
- Communication plan: Provides a description of the
communication procedures to be followed by
management, team members and the customer
- Project standards and procedures: Provides a
description of how deliverables will be evaluated and
accepted by the customer
- Other project-specific topics: Provides a description
of any other relevant issues related to the project
uncovered during planning.

3.5 Reviewing the Baseline Project Plan

 Before submitting the BPP to some project approval body, it

is to be reviewed by the users, management and development
groups.
 The objectives of this review is to assure that the proposed
system conforms to organizational standards and to make
sure that all relevant parties understand and agree with the
information contained in the BPP.

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 A common method for performing this review is called a

structured walkthrough, a peer group review of any product
created during the systems development process.
 The walkthrough may have specific agenda that highlights
what is to be covered and the expected completion time.
 Individuals attending the meeting have specific roles
- Coordinator
- Presenter
- User
- Secretary
- Standard-bearer
- Maintenance oracle
 In addition to reviewing the BPP, the walkthrough can be
used for the following activities
- System specifications
- Logical and physical designs
- Code or program segments
- Test procedures and results
- Manuals and documentation
 The key advantage of using a structured review process is to
ensure that found review points occur during the project. At
each phase of the project, a formal review should be
conducted to make sure that all aspects of the projects are
satisfactory accomplished before assigning additional
resources to project
 This conservative approach of reviewing each major activity
with continuation contingent on successful completion of the
prior phase is called incremental commitment.
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