PROJECT SELECTION

Why System Projects?

Systems projects are initiated for different reasons. The most important reasons are:

(a) Capability

Business activities are influenced by an organization’s ability to process transactions quickly

and efficiently. Information systems add capability in three ways:

(i) Improved processing speed: The inherent speed with which computers process data is one
reason why organizations seek the development of systems project.

(ii) Increased volume: Provide capacity to process a greater amount of activity, perhaps to take
advantage of new business opportunities.

(iii) Faster retrieval of information: Locating and retrieving information from storage. The ability
in conducting complex searches.

(b) Control

(i) Greater accuracy and consistency: Carrying out computing steps, including arithmetic,
correctly and consistency.

(ii) Better security: Safeguarding sensitive and important data in a form that is accessible only to
authorised personnel.

(c) Communication

(i) Enhanced communication: Speeding the flow of information and messages between remote
locations as well as within offices. This includes the transmission of documents within offices.

(ii) Integration of business areas: Coordinating business activities taking place in separate areas
of an organization, through capture and distribution of information.

(d) Cost

(i) Monitor costs: Tracking the costs of labour, goods and overhead is essential to determine
whether a firm is performing in line with expectations – within budget.

(ii) Reduce costs: Using computing capability to process data at a lower cost than possible with
other methods, while maintaining accuracy and performance levels.

(e) Competitiveness

(i) Lock in customers: Changing the relationship with and services provided to customers in
such a way that they will not think of changing suppliers

(ii) Lock out competitors: Reducing the chances of entering the competitors in the same market
because of good information systems being used in the organization.

(iii) Improve arrangements with suppliers: Changing the pricing, service or delivery
arrangements, or relationship between suppliers and the organization to benefit the firm.

(iv) New product development: Introducing new products with characteristics that use or are
influenced by information technology.
Sources of Project Requests

There are mainly four primary sources of project requests. The requesters inside the
organization are:

• Department Managers,

• Senior Executives

• Systems Analysts.

• Outside Groups

In addition, government agencies outside the organization may also ask for information systems
projects.

Managing Project Review and Selection

It is true that several requests for systems development are generated in the organization.
Someone in the organization must decide which requests to pursue and which to reject. The
criteria to accept or reject a request can be decided in several ways. One of the suitable
methods commonly in use is by committee. Mainly three committees’ formats are commonly
used:

(i) Steering Committee

(ii) Information Systems Committee

(iii) User-Group Committee

Steering Committee

This is one of the most common methods of reviewing and selecting projects for development.
Such a committee, consisting of key managers from various departments of the organization as
well as members of information systems group, is responsible for supervising the review project
proposals. This committee receives requests for proposal and evaluates them. The main
responsibility of the committee is to take decision, which often requires more information than
the proposal provides.

Information Systems Committee

In some organizations, the responsibility for reviewing project requests is entrusted to a

committee of managers and analysts in the information systems department. Under this
method, all a request for service and development are submitted directly to a review commit
within the information systems department. This committee approves or disapproves projects
and sets priorities, indicating which projects are most important and should receive immediate
attention.

User-Group Committee.

In some organizations, the responsibility for project decisions is entrusted to the users
themselves. Individual department hire own analyst and designers who handle project selection
and carry out development. Although the practice of having user committees both choose and
development systems does take some of the burden from the systems development group, it
can have disadvantages for the users. Some user groups may find themselves with defective or
poorly designed systems that require additional time and effort to undo any damage caused by
the misinformation that such systems could generate.

The Project Request

The project proposals submitted by the users or the analyst to the project selection committee
is a critical element in launching the systems study. There is a general agreement that a project
request form should contain the following:

• What is the problem?

• What are the details of the problem?

• How significant is the problem?

• What does user feel is the solution?

• How will the information systems help?

• Who else knows about this and could be contacted?

The project selection committee is responsible to review the proposals carefully and finally
selects those projects which are most beneficial to the organization. Therefore, a preliminary
investigation is often requested to gather details which are asked in the project request forms.

In some organizations, the responsibility for project decisions is entrusted to the users
themselves. Individual department hire own analyst and designers who handle project selection
and carry out development. Although the practice of having user committees both choose and
development systems does take some of the burden from the systems development group, it
can have disadvantages for the users.

Preliminary Investigation

The first step in the system development life cycle is the preliminary investigation to determine
the feasibility of the system. The purpose of the preliminary investigation is to evaluate project
requests. It is not a design study, nor does it include the collection of details to describe the
business system in all respect. Rather, it is the collecting of information that helps committee
members to evaluate the merits of the project and make an informed judgement about the
feasibility of the proposed project.

Analysts working on the preliminary investigation should accomplish the following objectives:

• Clarify and understand the project request.

• Determine the size of the project.

• Assess costs and benefits of alternative approaches

• Determine the technical and operational feasibility of alternative approaches.

• Report the findings to management, with recommendations outlining the acceptance or

rejection of the proposal.

Conducting Investigation
The data that the analysts collect during the preliminary investigation are gathered through
three primary methods: reviewing organization documents, on-site observations and
conducting interviews.

Reviewing Organization Documents

The analysts conducting the investigation first learn about the organization involved in, or
affected by the project. For example, to review an inventory systems proposal means knowing
first how the department works and who are the persons directly associated with inventory
system. Analysts can get some details by examining organization charts and studying written
operating procedures. The procedures clearly define various important steps involved in
receiving, managing and dispensing stock.

On-site observations

Another important technique to collect data is on-site observation. In this method, the analysts
observe the activities of the system directly. One purpose of on-site observation is to get as
close as possible to the real system being studied. During on-site observation, the analysts can
see the office environment, workload of the system and the users, methods of work and the
facilities provided by the organization to the users.

Conducting Interviews

Written documents and the on-site observation technique tell the analysts how the system
should operate, but they may not include details to allow a decision to be made about the
merits of a systems proposal, nor do they present user views about current operations. Analysts
use interviews to learn these details. Interviews allow analysts to learn more about the nature of
the project request and the reason for submitting it. Interview should provide details that further
explain the project and show whether assistance is merited economically, operationally and
technically.

Testing Project Feasibility

Preliminary investigations examine project feasibility, the likelihood that the system will be
useful to the organization. Three important tests of feasibility are studied and described below:

• Operational feasibility

• Technical feasibility

• Economic feasibility

Operational Feasibility

Proposed projects are beneficial only if they can be turned into information systems that will
meet the operating requirements of the organization. This test of feasibility asks if the system
will work when it is developed and installed. Are there major barriers to implementation? Some
of the important questions that are useful to test the operational feasibility of a project are given
below:

• Is there sufficient support for the project from the management? From users? If the
resent system is well liked and used to the extent that persons will not be able to see
reasons for a change, there may be resistance.
 • Are current business methods acceptable to the users? If they are not, users may
welcome a change that will bring about a more operational and useful system.

• Have the users been involved in the planning and development of the project? If they are
involved at the earliest stage of project development, the chances of resistance can be
possibly reduced.

• Will the proposed system cause harm? Will it produce poorer result in any case or area?
Will the performance of staff member fall after implementation?

Issues that appear to be quite minor at the early stage can grow into major problem after
implementation. Therefore, it is always advisable to consider operational aspects carefully.

Technical Feasibility

There are several technical issues which are generally raised during the feasibility stage of the
investigation. They are as follows:

• Does the necessary technology exist to do what is suggested (and can it be acquired)?

• Does the proposed equipment have the technical capacity to hold the data required to
use the new system?

• Can the system be upgraded if developed?

• Are there technical guarantees of accuracy, reliability, ease of access and data security?

Economic Feasibility

A system that can be developed technically and that will be used if installed, must still be
profitable for the organization. Financial benefits must equal or exceed the costs. The analysts
raise various financial and economic questions during the preliminary investigation to estimate
the following:

• The cost to conduct a full systems investigation.

• The cost of hardware and software for the class of application being considered.

• The benefits in the form of reduced costs or fewer costly errors.

• The cost if nothing changes (i.e. the proposed system is not developed).

To be judged feasible, a proposal for the specific project must pass all these tests. Otherwise, it
is not considered as a feasible project.