Feasibility study: Organizational Goals and Objectives

Organizational Goals and Objectives

Company mission statement and goals

Information systems strategic plan and goals

Organizational constraints

Organizational approach to AIS

Organizational and AIS priorities

Inventory and Assessments

Current systems

Approved systems

Current hardware

Current software

Current AIS staff

Assessment of strengths and weaknesses

Status of Systems Being Developed

Proposed systems priorities

Approved systems development

Proposals under consideration

Development timetables and schedules

Forecast of Future Developments

Forecasts of information needs

Technological forecasts

Environmental/regulatory forecasts

Audit and control requirements

External user needs

As shown in Figure 20-1, a feasibility study (or business case) is prepared during systems analysis and updated as necessary during the SDLC. The extent varies; for a large-scale system, it is generally extensive, whereas one for a desktop system might be informal. The feasibility study is prepared with input from management, accountants, systems personnel, and users. feasibility study – An investigation to determine whether it is practical to develop a new application or system. At major decision points, the steering committee reassess feasibility to decide whether to terminate a project, proceed unconditionally, or proceed if specific problems are resolved. Early go/no-go decisions are particularly important because each subsequent SDLC step requires more time and monetary commitments. The further along a development project is, the less likely it is to be canceled if a proper feasibility study has been prepared and updated. Although uncommon, systems have been scrapped after implementation because they did not work or failed to meet an organization’s needs. Bank of America, for example, hired a software firm to replace a 20-year-old system used to manage billions of dollars in institutional trust accounts. After two years of development, the new system was implemented despite warnings that it was not adequately tested. Ten months later the system was scrapped, top executives resigned, and the company took a $60 million write-off. The company lost 100 institutional accounts with $4 billion in assets. Focus 20-3 describes a Blue Cross/Blue Shield project that was scrapped after six years and a $120 million investment. There are five important aspects to be considered during a feasibility study:

1. Economic feasibility. Will system benefits justify the time, money, and resources required to implement it? economic feasibility – Determining whether system benefits justify the time, money, and resources required to implement it.

2. Technical feasibility. Can the system be developed and implemented using existing technology? technical feasibility – Determining if a proposed system can be developed given the available technology.

3. Legal feasibility. Does the system comply with all applicable federal and state laws, administrative agency regulations, and contractual obligations? legal feasibility – Determining if a proposed system will comply with all applicable federal and state laws, administrative agency regulations, and contractual obligations.

4. Scheduling feasibility. Can the system be developed and implemented in the time allotted? scheduling feasibility – Determining if a proposed system can be developed and implemented in the time allotted.

5. Operational feasibility. Does the organization have access to people who can design, implement, and operate the proposed system? Will people use the system? operational feasibility – Determining if the organization has access to people who can design, implement, and operate the proposed system and if employees will use the system.