Managing Information Technology

416 Part III • Acquiring Information Systems

Rank Alternatives

Sensitivity Analysis

Even if it is not possible to compute explicit numerical values, it

may be possible to estimate with enough accuracy to rank the

alternatives.

Use sensitivity analysis to deal with uncertainties. If a precise

value is not known for a parameter, repeat the analysis with

alternative values.

FIGURE 11.5 Alternatives to ROI for Justifying Investments

As described earlier, a committee of business and IT
leaders is typically charged with new systems project
approvals and prioritization. This committee also typically
approves the project charter from the project initiation phase
before additional resources are committed. If approved, the
charter document also serves as a tool for the project man-
ager, the project sponsor, and the IS and business oversight
committees to monitor adherence to the agreed-upon project
objectives and scope over the life of the project.

Project Planning

The objective of the planning process is to ensure that the
project goals are achieved in the most appropriate way. The
three major components of project planning are project
scheduling, budgeting, and staffing. These components are
obviously interrelated, and poor planning for one compo-
nent can severely affect another. Good estimation tech-
niques are especially important for systems projects that
involve immature or emerging technologies. In general, con-
servative (rather than optimistic) estimations as well as con-
trol mechanisms that focus on the areas of greatest project
uncertainty and organizational vulnerability are recom-
mended. Although we emphasize next some proven tech-
niques for good project planning and control, it should also

be kept in mind that experienced project managers will tailor

their approaches to match the special circumstances of a

given project or organizational situation (see the box entitled

“256 Project Characteristics To Be Managed”).

“Scope creep” is often touted as a potential pitfall to

watch out for during project planning. However, sometimes

changes in the project scope are positive changes that result

from a better understanding of business needs or tech-

nology capabilities during the planning phase. According to

Russell (2007), “scope creep” only becomes a problem

when the project manager and business stakeholders don’t

agree that the scope has been changed and the impacts of

these changes aren’t formally and realistically accounted

for in the project schedule, budget, and staffing.

Scheduling

Developing a project schedule typically involves a work

breakdown analysis: identifying the phases and sequence

of tasks that need to be accomplished to meet the project

goals—as well as the goals for other organizational and

external party obligations—and then estimating the time of

completion for each task. For systems projects, the project

phases as well as the detailed activities for each step and

their sequence can typically be derived from the systems

methodology being used for the project.

256 Project Characteristics To Be Managed

Projects can have an overwhelming number of different characteristics. They can be high-risk or low-

risk, long-term or short-term, state-of-the-art or routine, complex or simple, single-function or cross-

functional, large or small, technology-driven or market-driven, contracted out or performed in-house,

and so on. These eight characteristics alone can lead to 256 different combinations that might entail a

different approach to project planning, execution, or control.

[Based on Roman, 1986]