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 INFORMATION SYSTEM DESIGN AND
During the study, the problem definition is solved and all aspects of problem to
included in the system are determined. The main objective of a feasibilitystudy
to determine whether a certain plan of action is feasible—that is, Whether or
not
it will work, and whether or not it is worth doing economically Feasibilitysh
be measured throughout the life cycle The scope and comp exi of an apparently
feasible project can change after th Initial problems and opportunities are
analyzed. Thus the system that seems to be feasible initially may become
after feasibilitystudy. The result of feasibility study is simply a report whichisa
formal document det g the nature and scope of the proposed solution.
As a decision document, the feasibilitystudy must answer three key
1. Is there a new and better way to do the job that will benefit the user?
2. What are the costs and savings of the alternatives?
3. What is recommended?

FEASIBILITY CONSIDERATIONS
The key considerationsthat are involved in the feasibility analysis are:
Economic Feasibility
• Technical Feasibility
Operational Feasibility

Feasibilty Study

Economic Technical Operational

Feasibility Feasibility Feasibility

Figure 7.1 Types of FeasibilityStudy

7.3.1.1 Economic Feasibility

For any system if the e*pected benefits exceed the expected costs, the system
can e judged to be economicallyfeasible.The economicalfeasibilitywill review
the expected costs to see if they are in-line with the projected budget or if the
project has an acceptable return on investment. Thus, the purpose of assessing
 STUDY
feasibility is to identify
developmentof the purposed the financial
system. benefits and cost associated with the
long-termgains or produce no short-term costs are
tem is not economically immediate not overshadowéd by
feasible, and reduction in operating costs, then the
on the other hand, if the the project should
expected not proceed any further.
bejudged to be economically benefits equal or exceed
costs, the system can
benefit analysis. It is thefeasibl . Economic Feasibilityis also known as the
of the proposed most
ommonly used method for evaluating the
effectiveness system.
The procedure used in
assessing economic
AFirst1y the various feasibilityis as follows:
benefits and savings
that are expected from a system are
Then the various types
of cost associatedwith
the proposed system are
The next step is to compare
the benefits with the costs.
Alf benefits outweigh costs,
then system is economically feasible and the
decision is made to design and
implementthe system.

Determine
the expected Determine
benefits the expected
costs

Benefits Yes Design and Implement

exceed the proposed system
costs?

No

Either abandon the idea or alter the

purposed system to make
it economically feasible.

Figure 7.2 Procedure for assessing economicfeasibility

 INFORMATION SYSTUM DUSION ANö
• Otherwise the system ig unfengible and eit'her the ideo of propoxecl
is dropped or further ju8tifieotionor nlterationt4in the propogccl
have to be mode if it hug n chance of being approved.
To carry out an economical feasibility8tudy it 18nece88nryto estimate
money value against activities for implementing the 8Y8tem.
Possible questions •that need to be answered while doing economic fcdNiblllty
are:
Is the system cost effective?
Do benefits outweigh costs?
What is the cost of doing full system study?
What is the estimated cost of hardware?
What is the estimated cost of software/softwnre developnunt?
Is the project possible, given the resource constraints?
What are the savings that will result from the system?
What is the best alternative among alternative financing arrangcmcnt8
(rent/ lease/ purchase)?
7. Technical Feasibility
A large part of determining resourceshas to do with assessing technical
feasibility.bechnical feasibility assesses the current resources (such as hardware
and software and technology, which are required to aecotnplish user requirements
within the al ated time and budget. It focuses on the existing connptl(er system
(hardware, software, etc.) and identifies to what extent it can supp( the proposed
system. It ascertains whether the current resources ancl technology can be upgraded
or should be replaced to acconvlish specified user requirelnents. It also determines
whether the technology needed for the 'roposed systetn is available and how it
can be integrated within the organization. If the old technology is replaced by thc
new one, then technical evaluation must also assess whether the staff have technical
expertise to understand and use the new technology.
Technical feasibility also perforllls the following tasks.
Analyzes the technical skills and capabilities of the software development
team members.
• Determines whether the relevant technology is stable and established.
Ascertains that the technology chosen for software developtnent' has a
large number of users so that they can be consulted when probletns arise
or improvements are required.
 STUDY
In assessingtechnical feasibility, the
their own experience and expertise of system analysts is beneficial,
their contact with vendors they will be able
sincewer the question of technical feasibility.
fie essential questions that help in testing
the technical feasibilityof a system
following:
ude the
Is the project feasible within the limits of current technology?
Does the technology exist at all?
Is it available within given resource constraints?
Is Manpower (programmers, testers & debuggers) easily available?
Are the current technical resources sufficient for the new system?
Can they be upgraded to provide the level of technologynecessaryfor the
new system?
Do we possess the necessary technical expertise, and is the schedule
reasonable?
Can the technology be easily applied to current problems?
Does the technology have the capacity to handle the solution?
Do we currently possess the necessary technology?
7.3 .3 Operational Feasibility
Operationalfeasibility is dependent on human resources available for the
It visualizes whether the system will be used once it is developed and
operationaCIt is a measure of how well a proposed system solves the problems,
andtakesadvantage of the opportunities identified during scope definition and
howit satisfies the _requirementsidentified in the requirements analysis phase of
systemdevelopment.'It reviews the willingnessof the organizationto support the
proposed system. It also includes determining the reaction of staff towards the
development of new system.
The essential questions that help in testing the operational feasibility of a
systeminclude the following:
Analyzes whether users will adapt to the new software?
How do the end-users feel about their role in the new system?
What end-users or managers may resist or not use the system?
How will the working environment of the end-user change?
Can or will end-users and management adapt to the change?
 INNRNATION SYSTEM DESIGN
• Are the current work practices and procedures adequate to support
new system?
• Does managementsupport the project?
• Are the users not happy with current business practices?
• Will it reduce the time (operation)considerably?

.2 STEPS IN FEASIBILITY ANALYSIS

The Feasibility Analysis helps determine whether the system being considered
is technically, financially and operationally viable. It consists of series of steps that
act as a guide to prepare a complete and thorough feasibility study. Thesesteps

A-. Form a project team and appoint a project leader.

/Z. Prepare system flowcharts.
Z. Enumerate potential candidate systems.
A. Describe and identify characteristicsof candidate systems.
—5.Determine and evaluate performance and cost effectiveness of each
candidate system.
6. Weight system performance and cost data.
/7. Selectthe best candidatesystem.
A. Prepare and report final project directive to management.
1. Form a project Team and Appoint a Project Leader
The first step in feasibilitystudy is formation of a project team. The team will
consist of varied individuals whose knowledge and experience are essential for the
success of the system. A project leader, generally a senior systems analyst, is also
appointed who is responsiblefor planning, executing and promoting the activities
that a project undertakes. For conducting feasibility study for smaller systems, an
analyst and an assistant are sufficient but for complex projects a project team is
formed. This team consists of analysts and user staff. Sometimes an outside
consultant is included in the team to ensure accuracy and objectivity of the study.
An information specialist who helps gather and access information for the feasibility
study can also become the part of project team. It is ensured that those conducting
the study have full access to the specific information they need. Meetings of the
project team are held from time to time to keep a check on the ongoing activities
and accomplish the goal of selecting the best candidate system. A record is kept
of the progress made in each meeting.
132 INFORMATION SYSTEM DESIGN AND IMPLEMENTAh
Thus, the weighted candidate evaluation matrix is prepared using these steps
and candidate system 1 is selected.Thus it helps in the selecting the best system,'
7. Select the Best Candidate System
This step uses the weighted candidate evaluation matrix prepared in the
revious step to choose the best system among all the candidate systems.
As shown in the above
system with highest total score is termed as the best system.
table, the candidate system 1 has the highest score when the weights are multiph.ed
with ratings. So it is regarded as the best system and is chosen for further
development.For the sake of simplicity we have considered only three candidate
systems with performanceand cost as evaluation criteria but in reality feasibih.y
studies select from more candidate systems and the criteria chosen and the
constrainb are also more complex.
Report
The final step in feasibility study is the preparation of feasibility report. A
feasi ility report is a formally documented output of a feasibility study. It provides
basis for system design and should neither be too brief nor too detaile It
recommends the best candidate system which is carry forwarded to desi p ase
It should also give justifications along with conclusions and recommendations.It
is used by management for deciding whether to go with system development or
not. Thus it should be presented in non technical and simple language that is easily
understoodby the management.
There is no standard format for preparing feasibility reports. Sometimes the
summary of findings and recommendations are given the beginning followed
by document details or it can be the other way around. tarting the report with
summary information highlights the crux of the report an gives the management
the option of reviewing the details later. Analysts usually choose a format that
suits the end user.
Us ally a feasibilityreport includes the following sections:
Cover letter: It formally begins the report by briefly presenting the nature
of the problem, summary of findings and recommendationsto the
management.
WTable of contents: It lists the various sections included along with their
location in the report. Using table of contents the management can quickly
refer to the sections they are concerned about.
Overview: It gives an explanation of scope of system under study and
purpose of conducting the feasibility study. This section outlines the various
 departments and
people involved
study and the in the study, date of commencementof
circumstances
the effect of the surrounding the study.
candidate system It also briefly explains
x-Detai1ed findings: on various departments.
Z Firstly, it
system emphasizing summarizes the methods
in existing system. the effectiveness, used in the existing
efficiency and operating costs involved
procedures of the Then a description of the objectives and general
candidate
system with the candidate system are provided. It compares the existing
The management can system
feel the need highlightingthe pros and cons of each.
reviewing the output for developing the candidatesystem by
reports presented
5_.40nomic justification: in this section.
estimates as well as This section gives the details of preliminary cost
various
operation of the candidate cost comparisonsfor the developmentand
is also included to system. A return
evaluate the efficiency on investment (ROI)analysis
the efficiency of a number of of an investment or to compare
different investments.
v.R@commendations and
concludes the study and conclusions: This section of feasibility report
implementation. It suggests to
recommends the most feasible system for
performance and cost effectiveness. management the best system in terms of
management is not bound to It is just a recommendationand the
follow it. They can again review the
co clusions and recommendations
before taking further steps.
Appendixes: The information that is not essential
to explain the findings
but that supports the analysis and validates the conclusions included as
is
appendixes. Thus all memos and data compiled during the investigation
are placed in the appendixes section at the end of the report for reference.
As the feasibility report is only a recommendation,the management'sapproval
isnecessarybefore the system design is initiated. Thus, once the report is prepared,
itis submitted to the management for review. It is very rare that it is not approved
butstillgreat caution must be taken to cover all the aspects while conducting the
feasibilitystudy and preparing the report.

POINTS TO REMEMBER
1. A feasibility study is conducted to select the best system that meets
performance requirements. It involves three steps:
(a) Statement of constraints: It consists of two types of constraints:
(i) Business Constraints