The Feasibility Study
IT systems are a major capital investment and the systems analyst is called to investigate the feasibility of a system and help answer the questions – Will the system pay for itself? In how long will it pay off? Are the other technologies that will have a better return on the investment? Module 3 emphasizes the need of making management recommendations in a proposal called the feasibility study report. Feasibility is defined as the value that an IT system will provide to the organization in terms of tangible and intangible benefits. Following the problem analysis definition and requirements, the feasibility study is prepared considering elements such as economic, technical, operational, schedule, legal/contractual, and political challenges. This analysis determines the readiness and worthiness of an IT system, and the category domains are defined as follows.
Economic – What is the TCO (total cost of ownership)? Is the ROI positive?
Technical – Is hardware available? Do we need to purchase it?
Operational – Are resources available? Do we need training and change management plans?
Schedule – Can the system be available within a reasonable time?
Legal – Are permissions being filed with state and federal regulations?
Political – Is the system in compliance with federal and state agencies?
Most analysts agree that the first four categories are sufficient to analyze a system, but legal and political criteria are used to evaluate R&D projects or projects using emerging technologies. Holdstrand and Holz-Clause’ articles closely examine the four feasibility categories.
Holdstrand, D, & Holz-Clause, M. (2009). What is a feasibility study. AG Decision Marker. Retrieved from
The Case for Module 3 is a hands-on project illustrating how a business analyst would build a short feasibility report. You can review Sage Peachtree accounting system at http://na.sage.com/sage-50-accounting-us/ to formulate an idea of accounting systems and how the features work for your in-house development assignment. Please assume that the new system is for a small company growing to medium size.
- You have been assigned to prepare a feasibility study report for an accounting information system. At this point, please assume that you will build an in-house solution.
Use the following site as a reference to develop the feasibility study report.
FreeTutes. (2012). Feasibility study. Systems Analysis and Design. Retrieved from http://www.freetutes.com/systemanalysis/sa3-feasibility-study.html
Include the following report sections with corresponding section subtitles to organize the report:
- Cover page
- Introduction page stating the problem background, summary of needs for an accounting system, interviews conducted, and project stakeholders
- Articulate 3-5 system requirements
- Discuss the economic, technical, operational, and scheduled feasibility.
Your paper should be short (2-4 pages, not including cover sheet and references) and to the point. It is to be structured in the following manner.
You are expected to:
- Write this paper using the recommended feasibility study sections
- Cite appropriate sources and answer questions directly. Be sure to make the most effective case you can. Then present the best evidence you can, again citing appropriate sources.
By the end of your paper, you should be able to distinguish the types of feasibility studies applicable to a new project and document such findings into a management report.
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