SYSTEMS ANALYSIS Lesson 3: Systems Analysis

AND DESIGN Fundamentals

 TOPICS:
1. Project Initiation
2. Project Feasibility
3. Areas of Feasibility
4. Feasibility Analysis
5. Work Breakdown Structure
6. PERT?CPM Diagram
7. Gantt Charts
 PROJECT INITIATION
✓ The project initiation phase is the first phase within the project
management life cycle, as it involves starting up a new
project.
✓ Within the initiation phase, the business problem or opportunity
is identified, a solution is defined, a project is formed, and a
project team is appointed to build and deliver the solution to
the customer.
✓ Three general driving forces:
1. To respond to an opportunity
2. To resolve a problem
3. To conform to a directive
 PROJECT FEASIBILITY
✓ During project feasibility, the project manager answer
questions such as:
1. Are the expected benefits reasonable?
2. Are the assumed costs realistic?

✓ The objective of project feasibility is to determine whether a

development project has a reasonable chance of success.
✓ Feasibility analysis basically identifies all the risks of failure.
 AREAS OF FEASIBILITY
1. Economic Feasibility
✓ Process of identifying the financial benefits
and costs associated with a development
project.

✓ Consist of two test:

a. Is the anticipated value of the benefits greater than
projected cost of development?
b. Does the organization have adequate cash flow to
fund the project during the development period.
 AREAS OF FEASIBILITY
✓ Cost-benefit analysis is the analysis to compare costs and
benefits to see whether investing in the development of a
new system will be beneficial.

✓ Three-step process:
1. Estimate the anticipated development and
operational cost.
2. Estimate the anticipated financial benefits.
3. Cost-benefit analysis is calculated based on the
detailed estimates of costs and benefits.
 AREAS OF FEASIBILITY
✓ Costs and benefits can be viewed as:
1. Tangible
2. Intangible
✓ Three techniques to assess economic feasibility:
1. Net Present Value (NPV) - is the difference between the
present value of cash inflows and the present value of
cash outflows over a period of time.
 AREAS OF FEASIBILITY
✓ Costs and benefits can be viewed as:
1. Tangible
2. Intangible
✓ Three techniques to assess economic feasibility:
1. Net Present Value (NPV) - is the difference between the
present value of cash inflows and the present value of
cash outflows over a period of time.
 AREAS OF FEASIBILITY
2. Payback Period - refers to the amount of time it takes
to recover the cost of an investment.
3. Return of Investment (ROI) - is a performance measure
used to evaluate the efficiency of an investment or
compare the efficiency of a number of different
investments.

✓ The Time Value of Money (TVM) is the concept applied to

each technique, which refers to the concept of comparing
present cash outlays to future expected returns.
 AREAS OF FEASIBILITY
2. Technical Feasibility

✓ To gain understanding of the organization’s ability to

construct the proposed system.
✓ Should include an assessment of the development groups
understanding of the possible target hardware, software
and operating environments to be used as well as system
size, complexity and the group’s experience with similar
systems.
 AREAS OF FEASIBILITY
3. Operational Feasibility

✓ Process of assessing the degree of which a proposed

system solves business problems or takes advantage of
business opportunities.
✓ Measure of how well the solution will work in the
organization.
✓ Measure of how people feel about the system/project.
 AREAS OF FEASIBILITY
4. Schedule Feasibility

✓ Gain understanding of the likelihood that all potential

time frames and completion date schedules can be met
and that meeting these dates will be sufficient for dealing
with the needs of the organization.
✓ Measure of how reasonable the project timetable is.
 AREAS OF FEASIBILITY
5. Resource Feasibility

✓ Requires the involvement of system analysts, system

technicians and users.
✓ Risk to consider here is that the people who are assigned
may not have the essential skills for the project.
✓ Other resources needed for a project to be successful
include adequate computer resources, physical facilities
and support staff.
 FEASIBILITY ANALYSIS

✓ Process by which feasibility is measured.

✓ It is the process of confirming that a strategy, plan or
design is possible and makes sense.
✓ Designed to determine whether or not a project will be
successful.
✓ Conducted for a project with an emphasis on financial
feasibility, environmental integrity, cultural acceptability
or political viability/
 FEASIBILITY ANALYSIS

✓ Elements of feasibility analysis for a project should cover:

1. Need analysis
2. Process work
3. Engineering and design
4. Cost estimate
5. Financial Analysis
6. Project Impacts
7. Conclusions and recommendations
 WORK BREAKDOWN
STRUCTURE (WBS)
✓ Hierarchy of phases, activities and individual tasks that are
required to complete the project.
✓ The foundation for developing the project schedules for
identifying milestones in the schedule and for managing
cost.
✓ Developed before dependencies are identified and
activity durations are estimated.
✓ Can be used to identify the tasks in PERT diagram.
 WORK BREAKDOWN
STRUCTURE
1. Block diagram
✓ Is a graphical representation of a system – it
provides a functional view of a system.
✓ Block diagrams give us a better
understanding of a system’s functions and
help create interconnections within it.
✓ Helps us understand systems – hardware
and software systems as well as business
processes and operations.
 WORK BREAKDOWN
STRUCTURE

2. Outline form
✓ WBS is a hierarchical structure which can
be conveyed in outline form.
✓ Organizations refer to different levels of
tasks, subtasks and work packages.
 PERT/CPM DIAGRAM

✓ PERT is an acronym for Program Evaluation and Review

Technique and CPM stands for Critical Path Method.
✓ Is a visual representation of a series of events that must occur
within a project’s lifetime.
✓ Diagram of all the tasks identified in the WBS illustrating the
sequence of dependencies of the tasks.
✓ The critical path is the longest path trough the PERT/CPM
diagram and contains all the tasks that must be done in the
defined sequential order.
PERT/CPM DIAGRAM
RULES IN PERT/CPM DIAGRAM
RULES IN PERT/CPM DIAGRAM
RULES IN PERT/CPM DIAGRAM
DISADVANTAGES OF PERT/CPM
DIAGRAM
DISADVANTAGES OF PERT/CPM
DIAGRAM
 GANTT CHARTS
✓ Developed in 1971 by Henry Gantt.
✓ A Gantt chart is commonly used in project
management, is one of the most popular and
useful ways of showing activities (tasks or
events) displayed against time.
✓ Each activity is represented by a bar; the
position and length of the bar reflects the start
date, duration and end date of the activity. This
allows you to see at a glance.
 GANTT CHARTS SHOWS

✓ What the various activities are

✓ When each activity begins and ends
✓ How long each activity is scheduled to last
✓ Where activities overlap with other activities, and by how
much
✓ The start and end date of the whole project
ADVANTAGES OF GANTT
CHARTS
GANTT CHARTS
 REFERENCES:

➢ https://opentextbc.ca/projectmanagement/chapter/chapter-
7-project-initiation-project-management/
➢ https://www.investopedia.com/terms/n/npv.asp
➢ https://www.investopedia.com/terms/p/paybackperiod.asp
➢ https://simplicable.com/new/feasibility-analysis
➢ https://www.microtool.de/en/knowledge-base/what-is-a-
block-diagram/
➢ https://www.gantt.com/