Business Case
1.0 Introduction/Background
Martha Stockton Greengage will set up the Martha Stockton Greengage Foundation (MSG) to assist young couples in purchasing their own homes.
The document presented here is a SPMP for development of the MSG product by a small software organization consisting of three individuals, namely Andy, the owner of the company, and two software engineers, Bob and Cathy.
2.0 Business Objective
The objective of this project is to develop software product that will assist the Martha Stockton Greengage Foundation (MSG), in making decisions regarding home mortgages for married couples.The product will allow the client to add, modify, and delete information regarding the foundation’s investments, operating expenses, and individual mortgage information.The product will perform the required calculations in these areas and product reports listing investments, mortgage, and weekly operating expenses.
3.0 Current Situation and Problem/Opportunity Statement
There is no existing software with which the new product can be compared.Accordingly, it will not be possible to run the product in parallel with an existing one.There fore, the product should be subjected to extensive testing.
The client is assumed to be inexperienced with computers.Special attention was therefore paid to the specification phase and communication with the client.The product has to be made as user friendly as possible.
4.0 Critical Assumption and Constrains
Constraints are listed in the specificaton documents. they include the following:
The deadline must be met.
The budget constraints must be met.
The product must be reliable.
The product must meet the acceptance criteria.
The architecture must be open so that additional modules may be added later.
The product must conform to the client’s hardware.
The product must be user friendly.
5.0 Analysis Options and Recommendations
There are three options for addressing this opportunity:
1. Do nothing.The business is doing well, and we can continue to operate without this new project.
2. Purchase access to specialized software to support this new capability with little in-house development.
3. Design and implement the new intranet capabilities in-house using mostly existing hardware and software.
Based on discussions with stakeholders, we believe that option 3 is the best option.
6.0 Preliminary Project Requirements
If the applicant is approved, then the amount that the couple must pay MSG every week for the next 30 years is computed as follows:
1.The capital repayment is 1/1560th of the puchase price of the home.
2.The interest payment is 1/52 of 4 percent of the current mortgage balance.
3.The escrow payment is 1/52nd of the sum of the annual property tax and the annual homeowner’s insurance premium.
4.The total amount to be paid that week to MSG is the sum of(1), (2), and (3).
5.If (4) is greater than 28 percent of the couple’s gross weekly income, then MSG will pay the difference in the form of a grant.Thus the mortgage is paid in full each week, but the couple will never have to pay more that 28 percent of their combined gross income.
The couple must provide a copy of their income tax return each year so that MSG has proof of the previous year’s income.In addition, the couple may file copies of pay slips as proof of current gross income. The amount the couple has to pay for their mortgage may therefore vary from week to week.
MSG determines whether it has the funds to approve a mortgage application as follows:
1.At the beginning of each week, the expected annual income from its investments is computed and divided by 52.
2.The expected annual MSG operating expenses are divided by 52.
3.The total of the expected mortgage payments for that week is computed.
4.The total of the expected grants for that week is computed.
5.The amount available is then (1) – (2) + (3) – (4).
6.If the cost of the home is no more than (5), then MSG deems that it has the funds needed to purchase the home.
7.At the end of the week, any unspent funds are invested by MSG investment advisors.
To keep the cost of the pilot project as low as possible, the developers are told that only those data items needed for the weekly funds computation should be incorporated into the product.The rest can be added later if MSG decides to computerize all aspects of its operation.Therefore, only three types of data are needed, namely investment data, operating expenses data, and mortgage data.There is no need to incorporate the action MSG takes if mortgagees fail to make their weekly payment, as the records show that this is infrequent.
7.0 Budget Estimate and Financial Analysis
Budget and resources allocation the budget for each phase is as follows:
Requirement phase $2400
Object oriented analysis phase $2400
Planning phase $2400
Objet oriented design phase $4800
Implementation phase $10800
Integration phase $7200
Total $30,000
8.0 Schedule Estimate
The complete source code with user and operations mannual will be delivered 10 weeks after the project commences.The client will be responsible for acquiring the recommended hardware and system software by the time the product is delivered.
9.0 Potential Risk
There are several risks involved with this project.The foremost risk is a lack of interest in the new system by our internal consultants and external clients.User inputs are crucial for populating information into this system and realizing the potential benefits from using the system.There are some technical risks in choosing the type of software used to search the system, check security, process payments, and so on, but the features of this system all use proven technologies.The main business risk is investing the time and money into this project and not realizing the projected benefits.