Accession Number : ADA257475


Title :   Economic Analysis of Redesign Alternatives for the RESFMS Information System


Descriptive Note : Master's thesis


Corporate Author : NAVAL POSTGRADUATE SCHOOL MONTEREY CA


Personal Author(s) : Richardson, Ron M


Full Text : https://apps.dtic.mil/dtic/tr/fulltext/u2/a257475.pdf


Report Date : Sep 1992


Pagination or Media Count : 165


Abstract : This study is a practical example of economic analysis of information systems and of the software cost estimation problem as applied to software development in the Department of Defense (DoD). Economic analysis methods and the difficulty of software cost estimation are demonstrated using the proposed redesign of the Reserve Financial Management System (RESFMS), an information system operated by the U.S. Naval Reserve. The mandate for economic analysis in the DoD and procedures applicable to information systems are discussed. Two alternatives are analyzed: the status quo and a redesign proposed by Commander Naval Reserve Force (COMNAVRESFOR). Costs to be considered for each alternative are described. Since the major cost of the redesign will be software development, the problem of software development cost estimation is discussed. An estimate of software development cost is produced. This estimate and other identified costs are used to calculate the present value of savings, savings/investment ratio, and discounted payback period for the redesign alternative as compared to the status quo. Risk analysis, using a monte carlo simulation, is then performed to determine the range of possible outcome values and probabilities for each. The result of the economic analysis is a recommendation that RESFMS be redesigned as proposed by COMNAVRESFOR.


Descriptors :   *SOFTWARE ENGINEERING , *ECONOMIC ANALYSIS , *FINANCIAL MANAGEMENT , *MANAGEMENT INFORMATION SYSTEMS , *MODIFICATION , *COST ESTIMATES , COMPUTERIZED SIMULATION , SAVINGS , RISK ANALYSIS , COST BENEFIT ANALYSIS , DESIGN CRITERIA , MILITARY RESERVES , NAVY , MONTE CARLO METHOD , THESES , DEPARTMENT OF DEFENSE


Subject Categories : Administration and Management
      Economics and Cost Analysis
      Computer Programming and Software


Distribution Statement : APPROVED FOR PUBLIC RELEASE