Estimation Ethics questions for Business System Analysis & Design.

 Estimation Ethics A buy-in occurs when a company agrees to produce a system or prod- uct for less money than it knows the project will require. An example at CBI would be if a consultant proposed $15,000 to provide some software code when good estimating techniques indicate it would take $35,000. The consultant will absorb the extra costs. The consultant would use the strategy if the contract opens up other business oppor- tunities that are worth the $20,000 loss. Buy-ins always involve deceit. Most would agree that buying in and planning to stick the customer with the full cost later is wrong.What about in-house projects? Do the ethics change if an in-house coding team is doing the work? If team members know there is only $15,000 in the budget, should they start the project if they believe that its true cost is $35,000? If they do start, at some point senior manage- ment will either have to admit a mistake and cancel the project with a loss or find the additional $20,000. Project sponsors can state all sorts of reasons for such buy-ins: for example, “I know the company needs this system. If management doesn’t realize it and fund it appro- priately, then we’ll just force its hand.”Other buy-ins are more subtle. Suppose you are a project man- ager of an exciting new project that is possibly a career-maker for you. You are incredibly busy, working 6 days a week and long hours each day. Your team has developed an estimate of $50,000 for the project. A little voice in the back of your mind says that maybe not all costs for every aspect of the project are included in that estimate. You mean to follow up on that thought, but more pressing matters in your schedule take precedence. Soon you find yourself in front of management, presenting the $50,000 estimate. You probably should have found the time to investigate the estimate, but you didn’t. Is there an ethical issue here?Or suppose you approach a more senior manager with your dilemma. “I think there may be other costs, but I know that $50,000 is all we’ve got. What should I do?” Suppose the senior manager says something like “Well, let’s go forward. You don’t know of anything else, and we can always find more budget elsewhere if we have to.” How do you respond?DISCUSSION QUESTIONS1. Assess the ethics of buying in on a cost-and-materials project from the perspective of both the categorical imperative (page 18) and utilitarianism (page 43).2. Suppose you learn through the grapevine that your opponents in a competitive bid are buying in on a contract. Does this change your answer to question 1?3. Suppose you are a project manager who is preparing a request for a proposal of a systems development project. What can you do to prevent buy-ins?4. Assess the ethics of buying in on an in-house project from the perspective of the categorical imperative and utilitarianism. Are there circumstances that will change your ethical assessment? If so, state what they are and why they change your thinking.5. Suppose you ask a senior manager for advice as described in the guide. Does the manager’s response absolve you of ethical responsibility? Suppose you ask the manager and then do not follow her guidance. What problems could result?6. Explain how you can buy in on schedule as well as costs.

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