Cost of PRIDE? Ftrrores, his partners, and outside investors are to continue

project, they need to assess its investment potential. might be willing to take some loss for the sake of

service to his patients, but from the dialog in the iltmg of this chapteq, it doesn’t sound likely that his partners

A-nd no successful investor would consider putting y iurto a losing proposition. assess PRIDE’s investment potential, we need to know

potential as well as the costs of developing and trqg it. We don’t know the PRIDE business model, so we

;iassess the revenue aspect of this investment. Such an belongs in an entrepreneurship text and not in an

m any case.

it is appropriate for us to discuss, what a system ms FRIDE will cost. By now, you should have sufficient

to at least be able to determine the important cost eren though you don’t know the particular values.

10-28 lists potential development and operational for each of the five components of the PRIDE

IIost ofthese ccist sources are obvious from the discus- rhe SDLC in this chapter. A few, however, maybe unex- For one, notice the hardware and software developer

costs. Developers need computers on which to ramtl rcst code, and they need development software such

Visual Studio. There are likely network, server, costs for developers as well. Finally, devel-

m[[I need mobile devices of the type for which they are

1Q-28 of PRIDE Costs

Case Study 10

developing. A full panoply of iOS devices, Android devices, and Windows RT devices will be needed if all of those opera- tions systems are to be supported.

In the case of PRIDE, software is all custom-developed, so appreciable software development costs should be antici- pated. Estimating those costs will be difficult. We will discuss PRIDE security in Chapter 12; for now, r.ealize that applications will need to be developed to enable users to enter and update their security settings. AII software will need to be designed to limit access to that prescribed by users’ security settings.

Sources of data development costs are self-explanatory. As stated in the chapte4 there is normally considerable uncertainty about the time required for data modeling and database design. Because of the PRIDE prototype, this uncertainty will be less.

Procedures for all users must be designed and documented. These tasks are often more expensive than anticipated because those who develop the system may believe it will be easier to use than it is. Procedures need to be more detailed and better documented than they believe. Finally, operational jobs need to be defined, job descriptions r,ttitten for operations and support personnel, and possibly for development personnet if ongoing development is anticipated. Personnel need to be hired and trained.

As you learned in this chapteq, test plans need to be written and integrated system testing conducted. This activity may ne- cessitate full-time product quality assurance (peA) personnel as well.




420 CHAPTEFI 1O Development Processes

Using the collaboration IS you built in Chapter 2 (pages 73-74), collaborate with a group of students to answer thefol- lowing queslions.

Wilma Baker, |erry Barker, and Chris Bickel met in Iune 2Ol2 at a convention of resort owners and tourism operators.

They sat next to each other by chance while waiting for a pre-

sentation; after introducing themselves and laughing at the

odd sound of their three names, they were surprised to learn

that they managed similar businesses. Wilma Baker lives in Santa Fe, New Mexico, and specializes in.renting homes and

apartments to visitors to Santa Fe. |erry Barker lives in Whistler Village, British Columbia, and specializes in renting condos to skiers and’other visitors to the \A/histler/Blackcomb Resort.

Chris Bickel lives in Chatham, Massachusetts, and specializes in renting homes and condos to vacationers to Cape Cod.

The three agreed to have lunch after the presentation. During lunch, they shared frustrations about the difficulty of obtaining new customers, especially in the current economic dov,rnturn. Barker was especially concerned about finding cus- tdmers to fill the facilities that had been constructed to host the Olympics in the prior year. . As the conversation developed, they began to wonder if

there was some way to combine forces (i.e., they were seeking

a competitive advantage from an alliance). So, they decided to

skip one of the next day’s presentations and meet to discuss ways to form an alliance. Ideas they wanted to discuss further were sharing customer data, developing a joint reservation service, and exchanging property listings.

As they talked, it became clear they had no interest in merg- ing their businesses; each wanted to stay independent. They also

discovered that each was very concemed, even paranoid, about

protecting their existing customer base from poaching. Still, the conflict was not as bad as it first seemed. Barker’s business was primarily the ski trade, and winter was his busiest season; Bickel’s business was mostly Cape Cod vacations, and she was

busiest duringthe summer. Baker’s high seasonwas the summer

and fall. So, it seemed there was enough difference in their high

seasons that they would not necessariJy cannibalize their busi- nesses bysellingthe others’offerings to their own customers.

The question then became how to proceed. Given their desire to protect their own customers, they did not want to develop a common customer database. The best idea seemed to be to share data about properties. That way they could keep

control of their customers but still have an opportunity to sell

time at the others’properties. They discussed several alternatives. Each could develop her

or his or,rrn property database, and the three could then share those databases over the Internet. Or they could develop a centralized property database that ihey would all use. Or they could find some other way to share property listings.

Because,we do not know Baker, Barker, and Bickel’s detailed

requirements, you cannot develop a plan for a specific system.

In general, however, they first need to decifle how elaborate an

information system they want to construct. Consider the fol- Iowing two alternatives:

a. They could build a simple system centered on email. With it, each company sends property descriptions to the others via email. Each independent company then fonnrards these

descriptions to its oum customers, also using email. \fhen a customer makes a reservation for a property, that request is

then forwarded back to the property manager via email.

b. They could construct a more complex system using a Web- based, shared database that contains data on all their prop-

erties and reservations. Because reservations tracking is a

common business task it is likely that they can license an existing application with this capability.

In your ansu)ers to 1 and 2, use Microsofi Visio and BPMN templates to construct your diagram. If you don’t haue those templates, Ltse the cross-functional and basic flow’ chart templates. If you do not haue access to Visio, use PowerPoint instead.

l. Create a process diagram for alternative 4 using Figure 10-8 as a guide. Each companywill need to have a role for deter- mining its available properties and sending emails to other companies that describe them. Theywill also need have a role for receiving emails and a role for renting prop-

erties to customers. Assume the companies have from to five agents who can fulfill these roles. Create a role the email system if you think it is appropriate. Speci[u activities, repositories, and data flows.

2. Create a process diagram for alternative b, using 10-B as a guide. Each company will need to have a for determining its available properties and adding to the reservation database. They will also need a for rehting properties that accesses the shared data ASsume the companies have from three to five who can fulfill these roles. Create a role for the p database application. Specify roles, activities, reposi ries, and data flows.

J. Compare and contrast your answers in questions 1 2. Which is likely to be more effective in generating income? \A’Ihich is likely to be more expensive to \Alhrich is likely to be more expensive to operate?

If you were a consultant to Baker, Barker, and which alternative would you recolnmend? Iustify recommendation.

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