Chapter 4, Problem 8RQ

Explanation of Solution

Types of benefits from an Information Systems (IS) project:

The two different types of benefits from an IS project is as follows:

• Tangible benefits
  • Tangible benefits are those benefits that can be touched with hand.
  • The two tangible benefits are increased sales and the accounts at the receivable ends.
  • For example, revenue or increased sales comes under tangible costs.
  • Cost saving is also an example of tangible benefits.
  • The tangible benefits that an organization might obtain from an Information System (IS) project are as follows:
    • Reduction and avoidance of cost
      • Cost reduction and cost avoidance are two types of cost savings method for the project.
      • It is very hard to save costs by using cost reduction method and very easy to save costs by using cost avoidance method.
    • Error reduction
      • Most effective and efficient outcomes of the project are obtained by reducing the errors in the project.
    • Increased flexibility
      • It results in effective profits for the project.
    • Increase in activity speed
      • The user can finish the project without any delay in the estimated time if the task speed in the project is increased.
    • Management planning and control improvement
      • Improvement of management planning will help in managing the tasks in proper way.
• Intangible benefits
  • Intangible benefits are the business values that add considerable business values to the organization, but they cannot be measured or expressed in terms of quantities.
  • The new system allowed the customers to view more products at a time, and the payment methods were made easy...