Viva Vacations operates in Tampa, Florida. The company sells time shares and also manages residential properties that it rents to vacationers. Because of the large dip in the real estate market the last few years, most of its recent income has come from its rental business.

Until now, Viva has maintained its reservation records manually. To do this, the company maintains a separate manila folder for each rental property. The information in a folder includes reservations for the coming six months, maintenance and repair records, and receipts for other expenses that it collects for the property owner.

The company charges a client 30 percent of short-term rental income, and 10 percent of long term rental income (rentals of 3 months or more). The company’s rental business has grown steadily, and Chad Anderson, the owner, thinks it may be time to computerize this portion of its business. The problem is that he knows little about computers and has hired you as a consultant to study his situation and make recommendations.

Requirements

1. How would you explain to Chad why you would like to perform a systems analysis to study this system? What information do you think you would gather in the analysis phase of your study? Do you think it might be important that Chad is thinking about listing rental units on a new website to increase his business?

2. You are familiar with several software packages that might automate Viva’s rental business processes. You estimate that the best package comes from Global Adventures. It is the most expensive and will probably cost about $100,000 to implement. This includes the lease costs of the package itself, plus the costs of computerizing the company’s manual files. Assume that there are no benefits from the system the first year. You estimate the system will save the company a net of $20,000 the second year (after costs) and then $30,000 per year for the next three years. What is the net present value of the system? What recommendation will you make, based upon your calculations?

3. An alternate software package is also available from your friend, Mark Johnston. You don’t think it’s as good as the one from Global Adventures, but (1) it costs $20,000 less and (2) Mark is willing to pay a finder’s fee of $10,000 to you if you convince Chad to go with this system. Is it ethical for Mark to pay such a fee? Why or why not? Is it ethical for you to recommend this system instead of the Global package? Why or why not?

4. Discuss the role of an RFP for this situation. How might issuing an RFP help solve the ethical dilemma you might experience in number 3 above?