Executive Summary Final Submission

Interim Report

Keisha Wisher

Wilmington University

May 31, 2017

Interim Report

Background

The problem facing the CMS Bank is the acquisition of automated communication software to reach its clients at the most timely speed possible. The history of the issue arises from the recent financial crises that saw millions of investors in the mutual funds and other financial organizations institutions. The problem emerged from the failure of the investors in the financial sector to have accurate and timely information that could have helped them to make alternative investments. The loss heightened the investors’ fear of investing in a given mutual fund company that does not inform its investors sufficiently on the market trends that might expose them to financial losses. Thus, CMS Bank as a mutual fund company is considering acquiring communication software to resolve this problem of communicating with the clients sufficiently. Similar acquisition problems have been faced by the organization in the past that have proved successful. The capital budgeting process that has been used in the past decision-making process has been effective in helping the organization to make the optimal decision.

The problem of buying the best communication software has impacted diverse stakeholders. One of the stakeholders to be affected is the project manager since he will be responsible for ultimate decision adopted. Thus, he is concerned with ensuring the decision undertaken is the optimal option. The second stakeholder affected by the problem is the finance officer because he is responsible for evaluating the financial viability of the diverse acquisition alternatives in advising the project manager. Consequently, the finance officer must be diligent in the evaluation measures to ensure the right results have arrived under the evaluation considerations. The information and communication commissioner of the organization is also a stakeholder affected by the problem resolution. The information and communication technician will be responsible for advising the team on the various technical dimensions of the communication system. Thus, the technician will be concerned with the value of the technical assistance given in allowing the team to make an informed choice. Finally, the Chief Executive Officer of the CMS Bank is another stakeholder affected by the problem. The CEO is answerable to the investors and owners on the efficiency communication system that will be acquired. Accordingly, the CEO will be concerned with ensuring that the team assigned in resolving the problem is competent and trustworthy in delivering value to the investors and shareholders.

Problem Statement

CMS Bank management has considered the problem is determining the optimal communication system in reaching the clients at the timely speed possible. Thus, the problem focuses on determining the system that will deliver messages efficiently to the customers at a lower cost compared to the current communication system being deployed in the organization.

Objectives

1. Increase customer confidence

2. Promote customer loyalty

3. Communication efficiency

4. Cost saving

5. Attract more clients

6. Increase call volume per second

7. Enhanced market image

Decision Alternatives

The determination of the alternatives to select has been conducted using brainstorming, market research, meetings, and consultation. The brainstorming approach entails gathering a list of alternatives through spontaneous ideas from the group members. The market research determination involves a diligent process of identifying viable alternatives in the market using certain considerations and measures (Kerzner, 2015). The meeting approach employed involves assigning a given select committee to come up with the list of the possible alternatives (Lock, 2009). Lastly, the consultation entails hiring an expert to advise on the best alternatives the organization should focus on the selection process.

However, other alternative methods of voting, and consensus, could have been employed. The groupthink involves engaging as a group to determine the diverse alternatives to consider. The consensus approach involves the members agreeing on the different set of alternatives that will be evaluated in the selection process. In contrast, the voting approach individuals selecting their alternative and the alternatives with the highest votes are picked (Kerzner, 2015). Finally, three options have been chosen that include Oracle Communication, IBM Communication, and the Cisco Communication were selected.

Evaluation Considerations and Evaluation Measures

In determining the best alternative to select among the three, technical flexibility was employed. The technical flexibility evaluation consideration focuses on the alternative that has the best flexibility capability with the advancement of the communication technologies (Kerzner, 2015). This evaluation consideration was critical in selecting the optimal alternative to select due to the spontaneous changes in the technology in the contemporary environment. Thus, the flexibility capacity of a given alternative is critical in saving the future cost of acquiring new communication software.

Nevertheless, other relevant evaluation methods could have been employed in the analysis including cost-benefit method, payback period, and the net present value. The cost-benefit analysis involves comparing the cost of acquiring a given alternative compared to the benefits it will give (Brealey, Myers, & Allen, 2011). Thus, the alternative with the highest value gain is selected as the optimal investment.

The net present value on the other side considers the present value of the future cash flows minus the initial cost incurred of a given alternative (Brealey, Myers, & Allen, 2011). Thus, the alternative with the highest net present value is selected as the best investment decision. Equally, the alternatives can only be considered for consideration under the net present value if they have a value equal to zero or above. The potential of the alternatives to having a negative net present value will deem their rejection (Brealey, Myers, & Allen, 2011).

In contrast, the payback period entails determining the duration a given alternative will take to recover the cost incurred (Brealey, Myers, & Allen, 2011). Accordingly, the alternative with the least recovery duration is selected the optimal alternative in the analysis. Furthermore, the organization sets the maximum acceptable payback period (Brealey, Myers, & Allen, 2011). Thus, the alternatives will all be rejected they exceed the payback period policy of the organization.

However, these three evaluations were not considered since the communication systems by the three companies had a marginal cost difference. The cost benefit analysis, net present value, and payback period all concentrate on the financial measures. Moreover, the quality consideration ranked higher compared to cost in the evaluation measures of determining the optimal alternative to select (Lock, 2009). Thus, the technical flexibility evaluation consideration emerged as the best approach that could assess the quality of the alternatives in matching the needs of the organization. This part by professor [ EXPAND ON THE EVALUATION CRITERIA BEING USED. YOU SAY FAR MORE ABOUT THE ONES ELIMINATED THAN USED

Resources

In making the final capital investment decision, diverse resources will be employed in concluding the decision. Accordingly, the resources that will be utilized and consulted in the final decision have been listed below.

1. Qualified quality assessor

2. Information and communication quality experts

3. Information and communication security risk assessment

4. Evaluation software

References

Brealey, R. A., Myers, S. C., & Allen, F. (2011). Principles of corporate finance. New York: McGraw-Hill.

Kerzner, H. (2015). Project management 2.0: Leveraging tools, distributed collaboration, and metrics for project success. Hoboken, New Jersey: John Wiley & Sons.

Lock, D. (2009). The essentials of project management. Aldershot, Hampshire: Gower.