Reference no: EM133145966 , Length: word count:1000

Question: You just need to do the last part i.e. Cost benefit analysis and make a use case in extended/expanded use case diagram on page 12 & 13 of the document.

Cost-benefit analysis- 1000 words

This section is designed to convince your client of the economic feasibility of the proposed innovation.

By referring to the proposed information system (discussed in the previous section), show how much the innovation costs. Develop a table showing the cost components of the proposed solution - consider only the direct costs (however, in real life, you would also need to calculate indirect costs). Generate some dollar values. Assume the numbers; for example, you can have a clear statement of the cost you will impose for your system design work (@ $100 per hour). Make any assumptions you need. Remember, the costs need to be calculated over the next years, until the break-even is reached; and this table will be used to calculate Payback and ROI.

By referring to the proposed information system (discussed in the previous section), you should present the explicit benefits of your innovation to the business. For example, this may be providing better customer experience, obtaining new customers, improving productivity through decreased effort or time, or creating new customer value, etc. Generate some dollar values such as the return to the business (which is usually a guess based on estimated increased sales or savings). Remember, the benefits need to be calculated over the next years, until the break-even is reached; and this table will be used to calculate Payback and ROI.

Present the (i) payback analysis, and (ii) return on investment analysis, based on the costs and benefits you identified in the previous section. Do not forget to discuss these analyses - what they mean, what the implications are to the owner etc. Make any assumptions you need.