Problem Statement Matrix

SALES AND BOOK TRACKING SYSTEM

INTRODUCTION

I

n this section you will learn the necessary background information.
This information includes a history of the business, a description of
the business’s current facilities, and the descriptions of the
problems that triggered the project.

Background

Pinnacle Publishing is a book publisher located in Springfield, Ohio.
Though small in size at 50 employees, it is a leader in the growing
on-line publishing industry.

Traditionally, aspiring authors had two choices for publishing their
work. The preferred option was to convince one of the major book
publishers that their work deserved publication. The author would
receive an advance payment, let the publisher absorb the costs of
printing and promoting the book, and sit back and wait for the royalty
checks. However, mainline publishers accept only a few new manuscripts
each year. So authors might face many, many rejection slips and never
find a willing publisher. The second option for an author was to
self-publish through a “vanity press.” In this option, authors would
pay for the printing, take delivery of a garage full of books, and do
all the promotion themselves.

But with the growth of the Internet, a new option has emerged:
electronic publishing. An author’s work can be converted to an
electronic file that can be read on-screen or printed to a printer. From
a web site, potential buyers can purchase the file and download it. New
devices are being developed, such as book-sized LCD screens that accept
downloaded books, to make “e-books” as portable as paper books.
Because e-books bypass the expense of printing, they can be produced and
sold much more cheaply than paper books. All it takes is someone with
the expertise to produce quality e-book files and a popular e-book web
site.

That’s where Pinnacle Publishing comes in. This small company works
with authors to turn a manuscript into a polished e-book and maintains
an e-commerce site from which people all over the work can buy and
download the books. To increase their web presence, Pinnacle also
maintains a relationship with major book e-commerce sites to get
Pinnacle books listed on those sites. Pinnacle charges authors an
upfront charge that is smaller than what a vanity press would charge.
They charge a small commission on each book sale, and pass the rest of
the sale proceeds on to the author. Pinnacle also offers a book
promotion service to send out press releases on books for an additional
charge to authors.

Pinnacle Publishing does all this from their offices in Springfield,
Ohio. Pinnacle had just 10 employees two years ago, and 25 employees
last year. If growth continues they could pass 100 employees within the
next year or two.



The company outgrew its office six months ago and now has moved the
15-person sales force to another office building approximately 2 blocks
away from the rest of the employees. They are looking to build a large
office building that would combine all employees sometime next year. But
it is by no means certain that the quickly-growing staff would fit in
that building upon completion.

Organization Structure



Information Systems Facilities

The information architecture for Pinnacle Publishing standardizes on the
following:

Employee PCs (one each) – Hewlett Packard Pentium II and Pentium III
Class.

64 megabytes of RAM

4-10 GB hard drive

17” monitors

Operating Sys – MS Windows 2000 Professional

Software Tools – MS Office 2000 suite.

Network Server – Hewlett Packard 9000 class

256 megabytes of RAM

25GB hard disk storage in 4-disk RAID 5 array

Operating Sys – MS Windows 2000 Server

Database Management – MS SQL Server

Internet Server – Hewlett Packard 9000 class

256 megabytes of RAM

Matching 10GB hard disks with mirroring

Operating Sys – Redhat Linux 7.0

Printers – 5 shared Hewlett Packard LaserJets

The Problem

With its tremendous growth, the company desperately needs an integrated
information system to track its authors, books-in-process, sales, and
royalties. Currently, each sales person keeps a personal database in
Microsoft Access of his or her leads. These individual databases were
all created by the Technical Services Department according to a
template, and so are fairly standard. However, the individual databases
do not talk to each other. There is no way to be sure that two
salespersons are not courting the same author. In addition, it is
difficult to get any kind of combined author list or to calculate the
performance of the salespeople. One goal for the proposed information
system would be to have a central database of author leads that could be
used for checking duplicates, monitoring salesperson performance, and
providing for easy direct marketing to all active leads.

Once a sale is made and manuscripts come in, there is currently no
computerized system at all. A manual file folder is created for each
book-in-process that contains notes from each production worker. The
file folders move among several plastic bins that represent the various
stages of the production process: Manuscript Scanning, First Galley
Approval, Second Galley Approval, Electronic File Creation, Web Posting,
Press Releases, etc. When a worker needs to find a file, he or she has
to search through each bin until it is found. When an author calls in to
check on the status of his or her book (and they often do), that also
necessitates a lengthy search. The proposed information system should
allow for electronic tracking of books through the production process.
It should be able to identify the current status of each book. It should
also provide a mechanism for workers to enter notes electronically as
they carry the book through the process. Finally, the system should
support a self-service web site where authors can check on the status of
their book without calling Pinnacle.

Once a book is available for sale, the proposed system needs to
streamline the calculation of sales and royalties. Currently, sales
numbers are downloaded from the e-commerce server at the end of each
quarter and dumped into an Excel spreadsheet. Then numbers from outside
major book e-commerce sites are added to the spreadsheet. The Accounting
Department calculates royalties in Excel and manually writes checks.
Management would like the proposed system to automatically calculate the
sales and royalty information.

Introduction Page: I- PAGE 1

Springfield,

OH

Springfield, OH -

35 employees in Office A (Production & Mgmt)

15 employees in Office B (Sales)

MILESTONE 1 – PRELIMINARY INVESTIGATION

Synopsis

T

he purpose of the preliminary investigation phase is threefold. First,
it answers the question, “Is this project worth looking at?” To
answer this question, this phase must also define the scope of the
project and the perceived problems, opportunities, and directives that
triggered the project.

Problem

You work for Miracle Software, a small custom programming organization.
Your organization has been contacted by Mr. Brett Ramiriz, the vice
president of Information Systems for Pinnacle Publishing, to design and
possibly develop a proposed sales and book tracking system. By analyzing
the interview transcripts, determine the feasibility of the project,
level of management commitment and project scope to compose the Problem
Statement Matrix.

Mr. Ramiriz was gracious enough to allow us to record our interview
session, and Exhibit 1.1 is a copy of the transcript. Refer to the
Background found in the Introduction and the interview transcripts.

The following is a copy of the transcript of an interview between Mr.
Brett Ramiriz of Pinnacle Publishing and Cindy Natale, a systems analyst
for the consulting company, Miracle software. This was the initial
interview with Mr. Ramiriz, and its goal was to obtain facts about the
problems and opportunities that triggered the project request, plus
other general information that could be used to prepare the Problem
Statement Matrix.

Exhibit 1.1

Scene: Cindy Natale, systems analyst, is meeting with Brett Ramiriz,
Vice President of Information Systems for Pinnacle Publishing, at his
office. Ms. Natale scheduled the interview with Mr. Ramiriz in response
to his request for developing a sales and book tracking system.

Brett: Good Morning!

Cindy: Good morning, Mr. Ramiriz.

Brett: Call me Brett. We’re on a first name basis around here. And you
can see that this is a shirt-sleeves environment. I hope you can help
us.

Cindy: I hope so, too. Our company has helped many firms. Speaking of
that, let me start by asking you one question. Why are you interested in
hiring a software shop to develop your system? It looks as if you are
growing fast enough to support an in-house programmer.

Brett: We have an in-house programmer. But she’s so busy writing code
for our e-commerce site, that she couldn’t possibly build this system.
And I don’t think I have the time or expertise to supervise
programmers. I’m more of a network person. As you can see, we have
quite a network here – 50 PCs sub-netted with routers, a network
server, a web server and firewall. It keeps my Technical Services staff
busy just keeping the whole thing running. I’d rather farm this
development out to someone who has rock solid programming experience and
can stay focused and on-task day in and day out. Is that your company?

Cindy: Yes. We have a very good track record with producing systems that
actually do what they are supposed to do and bringing them in on time.
So what is this system supposed to do?

Brett: Everything! It needs to track sales leads, track books through
the production process, and read data from our e-commerce site to cut
quarterly royalty checks. We have SQL Server on our network server, so
you’ll probably want to use that as the back-end. But do you think you
want to use Access or Visual Basic or a web interface for the front-end
user interface?

Cindy: Well, it’s a little early to make that decision. But we have
some procedures for thinking that through. First, could you please
describe for me the business processes that will be included in the
system?

Brett: Wow! Well, the system should incorporate and integrate three
distinct processes. The first is the sales process. Our salespeople talk
to authors all over the US and Canada. We advertise in writing
magazines. Between that and our web presence and general publicity, we
get quite a lot of authors who call in here as sales leads. The
salespeople talk to them and enter their information into databases.

Cindy: Databases plural?

Brett: Right now, each salesperson keeps his or her own database of
leads. It seemed like a good idea when we set it up. But now we can see
that it isn’t effective. We end up with multiple salespeople working
the same lead. And since the salespeople keep their own data, Mary, the
VP of Sales, can’t do any analysis of salesperson performance.

Cindy: What type of analysis would she like to do?

Brett: I know she would like to track the number of active leads that
each salesperson has. She’d like to calculate things like calls per
lead and leads per sale. I can set you up an appointment with her so you
can ask her yourself.

Cindy: That would be a good idea. But for today, I think I should just
get the big picture. And you would like the system to check for an
author already being in the system whenever a new author is entered?

Brett: Right. Anyway, that’s the sales process. Once a salesperson
sells an author on our services, the production area takes over.

Cindy: What kind of form or notification passes from Sales to Production
when a sale is made?

Brett: Nothing really. That’s another part of the problem. The
salespeople make a sale, and then no one knows anything until a
manuscript shows up in the mail. Then someone from Production has to
call or e-mail everyone in Sales to find out the author information.

Cindy: What do they do with that information once they get it?

Brett: It gets recorded on a form and put in a folder. You probably saw
all those plastic bins with folders as you walked through the Production
area.

Cindy: Is that your present system for tracking production?

Brett: Sure is. High tech, isn’t it? The manuscript gets stuck in the
folder and placed in the first bin, which is Scanning. Bill, who is the
person responsible for scanning, scans the pages and edits the text into
a Word file, which is saved on the network drive in a folder marked with
our internal Book ID number. Then he places the folder in the First
Galley bin. Maria is responsible for First Galleys. She either sends a
printout of the Word file or e-mails a copy of the file to the author.
When it comes back with the author’s corrections, it goes to the next
bin.

Cindy: Does every book go through the same process?

Brett: No. Books that are submitted already in a word processing file
don’t need to be scanned. Most books go through two galleys, but some
need three. We offer a book doctor service for an additional charge;
that adds a step. And we have a promotion service that most, but not
all, authors purchase.

Cindy: What do you want the proposed system to do for you in the
production process?

Brett: Number one, it needs to do away with those bins. Jake –
that’s Jacob Spalding, the CEO – wants to keep the folders but store
them in a central file cabinet. Instead of routing the folders with the
bins, he wants the system to track each task. Each book that comes in
will be assigned to what he wants to call a “shepherd.” The shepherd
will oversee the production process for that book. The shepherd will get
a list of the status of each of his or her books each day. When the
shepherd sees that a book has finished one task, the shepherd will
assign it to another task and to the person who is supposed to
accomplish that task.

Cindy: How will that get communicated? How will the production person
know he or she is supposed to do a specific task?

Brett: I envision a system where the technician is automatically
e-mailed by the system. But we could do it with a daily report or
whatever.

Cindy: Does everyone have e-mail?

Brett: Yes. We have ADSL service from the local Internet Service
Provider. In the main office here we’ve contracted for 768 Kbps
service that is shared throughout the network. In the Sales office down
the street we have 384 Kbps shared among those 15 people. We do a lot of
e-mail communication with authors, booksellers, suppliers, magazines.

Cindy: Are the two offices networked together?

Brett: Not at this time. We’ve looked at dedicated lines between the
two offices, but it is so expensive for the amount of bandwidth you get.
We do e-mail back and forth a lot, but that just goes out over the
Internet. I’ve thought about setting up a virtual private network
across the Internet. We can get as much bandwidth as we need from the
ISP.

Cindy: I’ll take that into account. So in the production part, the
system needs to track the progress of each book. Is that all?

Brett: No. For one thing there is a lot of information about each book
that is currently recorded in the folder. It needs to be recorded in a
centralized database. This is information about promotion options that
have been sold, information about promotions that have been done, book
title and sub-title, ISBN, and technician notes about the book during
the production process. Second, I want to set up a self-service web site
the authors can use to check on the status of their books. We probably
field 50 calls a day from authors just to check up on progress. We ought
to be able to post information from the central book database to our web
database. If you can give me a button to press to export a subset of
that data, then I can have my web programmer build an author web site
around it.

Cindy: Sure, that should be easy. What kind of subset would you need?

Brett: We would just want the books that haven’t yet been published.
For those, we want to see the beginning and ending dates of all
production tasks so far.

Cindy: Can we post across the network to the web server?

Brett: Yes. The file server is connected through a firewall. You can
write from file server to web server, but not the other way around.

Cindy: I don’t want to get too specific today, but that part of it
certainly sounds feasible.

Brett: The third process is after the book gets published. We have an
e-commerce site. I can pull a sales summary from it on a quarterly
basis. That summary needs to be pulled back into your system, matched up
by book and author, and used to generate royalty checks. We also get
quarterly sales summaries from our e-commerce partners. These are major
e-commerce sites that sell books. We allow them access to our web
database so their customers can browse our books and order them. The
customers don’t know which books are whose. They just see that they
can buy an electronic version of a certain title. The customer downloads
the book and pays our partner. They pay us at the end of the quarter and
provide us with a sales summary. You’ll have to add those summaries
in.

Cindy: How many sales partners do you have?

Brett: Five. I think that number will stay constant for a while. There
are thousands of e-commerce sites out there. But it just isn’t worth
it to have to work with all of them.

Cindy: Anything else?

Brett: As part of the royalty process, we’ll have to have a quarterly
sales report that lists each author, sales for the quarter by source,
and a calculated royalty. I’ve mentioned the sales performance reports
for Mary. And I’ve mentioned some sort of reporting or e-mailing
mechanism to trigger things through the production process. I’m sure
Jake will want all kinds of management reports. But I don’t want to
slow down the development process by including them right now.

Cindy: Whom else should I talk with to get a feel for the present
system?

Brett: Definitely talk to Mary O’Neal about Sales. Talk to John
Bridgham to get an understanding of the production side. He’s the VP
of Operations.

Cindy: Great.

Brett: And before you leave today, I want to introduce you to Jake.
He’s too busy to use as a resource person. But you should hear his
perspective on what this system should do, and do whatever he says.

Cindy: You mentioned all the information that currently gets recorded in
the folders. Could you provide me with samples of those forms? I would
prefer to have copies of completed forms, if possible. They provide so
much more information about how the system is used.

Brett: I can see if someone can photocopy some entire folders. You
realize they will contain proprietary information. Jake is pretty
protective of his data.

Cindy: Yes, I understand. I will keep it confidential. That brings up an
issue of security. Will there be parts of the system you don’t want
some employees to get into?

Brett: You can count on it. Each salesperson should see only his or her
own leads. Mary and the production people will need to see everyone.
Production people need to see all books in process.

Cindy: All I need to know for now is that you will have a need for good
data security.

Brett: Right.

Cindy: Do you have a budget set for the system development?

Brett: Yes. Jake has authorized $50,000 for the project. That includes
any hardware and software upgrades that we’ll need to make it work.

Cindy: Part of what we analyze is whether the problem is worth solving.
Do you have any idea of the savings that would accrue from this system?

Brett: We had a staff meeting on that very issue. Mary said she had
salespeople fighting over 5 or 10 duplicated leads every week. Let’s
use 10 because we probably don’t know the half of it. That’s at
least 500 dupes a year. Our salespeople are required to make 5 calls per
lead. Those calls consume probably 20 minutes each. If a salesperson
costs $25 an hour for base plus commission plus benefits, that
calculates out at over $20,000.

Cindy: That’s quite a lot. What about savings from automating the
quarterly royalties?

Brett: John has two people working four full days on the calculations
each quarter. Do you think the new system could cut that in half?

Cindy: It ought to make it as easy as clicking a button. It can be
tricky to bring in data from an outside system. But let’s assume we
can cut the time in half.

Brett: That would be 32 person-hours. Price clerical people at $15 per
hour for wages and benefits. Multiply that by four quarters in the year,
I get around $2,000.

Cindy: What about those 50 calls a day from authors to check the status
of their books? What do we save with the data and the self-service web
site?

Brett: I would guess that those calls take 5 minutes each. Multiply that
by 5 days a week and 52 weeks a year and that same $15 an hour and what
do you get?

Cindy: I have it on my calculator – More than $16,000.

Brett: Round it down to $15,000 to allow for the time of maintaining the
web site.

Cindy: What about the timetable?

Brett: Frankly, that’s more of an issue than the money. You saw that
rat’s nest of bins and file folders on the way in. We’re drowning in
our own growth and need this system now. I realize that’s not going to
happen. Yet, I’d like to have the first phase of this project
completed in six months. If you can’t do it in less than nine months
then tell me now, and I’ll find somebody else.

Cindy: Well, I can’t tell you right now. But I can give you a pretty
good indication in a few days. I’ll review this information and give
you my report by next week. For now, I’ll let you get back to your
work. Thank you for your time.

Brett: No, thank you. I think you’re going to be a very helpful person
around here.

Milestone 1: Preliminary Investigation Page: 1- PAGE 1

PROBLEM STATEMENT MATRIX

PROJECT: PROJECT MANAGER:

CREATED BY: LAST UPDATED BY:

DATE CREATED: DATE LAST UPDATED:



Brief Statements of Problem, Opportunity, or Directive Urgency
Visibility Annual Benefits Priority or Rank Proposed Solution