CBAP · Question #547
The table illustrate the statement of cash flower for a courier company for the last fiscal year: Due to aggressive market competition the management of the company performed a strategy review and bas
The correct answer is D. Estimate the potential value delivered by each option. When comparing options, the BA's core responsibility is to estimate the potential value each option delivers so stakeholders can make a benefits-informed decision.
Question
The table illustrate the statement of cash flower for a courier company for the last fiscal year:
Due to aggressive market competition the management of the company performed a strategy review and based on their0-findings and the current market conditions, they came up with strategic and tactical changes in order to keep a competitive market position. In order to strength customer retention strategies through a new competitive advantage, the company is considering implementing a live parcel tracking system. The added value will be that the customers may determine the exact location on of the parcel whether it is in a warehouse, crossing the ocean through an overseas the exact location of th parcel whether it is in a warehouse, crossing the ocean through an overseas the ship, or travelling in a delivery truck at any time. The system tracks the location of the parcel by tracking the vehicle in which it is contained. However, for a group of old delivery trucks, it was noticed that the engine sound and vibration disturbed the tracking signal and caused of management would like to sell these vehicles and replace them with newer ones, the Chief Financial Officer (CFO) was strongly against that approach. The CFO argoad that instead of hanging tracking devices on the trucks body they can have the truck drivers manually send the truck send the truck location from a hand held mobile device every 20 minutes. What could the business analyst (BA) do to gain consensus between the CFO and other Management?
Options
- ACalculate the costs incurred by each option
- BRecommend and present a completely new option
- CCompare each option against an industry benchmark
- DEstimate the potential value delivered by each option
How the community answered
(43 responses)- A14% (6)
- B5% (2)
- C9% (4)
- D72% (31)
Why each option
When comparing options, the BA's core responsibility is to estimate the potential value each option delivers so stakeholders can make a benefits-informed decision.
Calculating costs is a necessary input to option analysis but is insufficient on its own because it provides no basis for judging whether the investment is worthwhile or which option yields the best outcome.
Proposing a completely new option at the evaluation stage is outside the BA's scope when the task is to compare already-identified alternatives, and it would restart the analysis process unnecessarily.
Benchmarking against industry standards is a useful analytical technique but is secondary to estimating the specific value each option is expected to deliver to the organization's own strategic goals.
Estimating the potential value delivered by each option is a fundamental business analysis activity in solution evaluation, ensuring stakeholders understand the expected benefits and not just the costs associated with each alternative. This enables a cost-benefit comparison that aligns the selected option with strategic objectives. Without value estimation, decision-makers cannot determine whether any option justifies the investment or which option offers the greatest return.
Concept tested: Business case - value estimation in option comparison
Source: https://www.iiba.org/standards-and-resources/babok/
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