Riverview Hospital Essay

2224 Words Jul 25th, 2013 9 Pages
Problem Summary

The Riverview Children’s Hospital is eight months behind schedule with the implementation of a new computerized financial system. Management wants the system to be in place by the end-of-year audit [April], which is only six weeks away. However, management estimates that there is only a fifty percent chance that the system will function correctly if its implementation is rushed. While this makes a case for delaying the implementation, it also pushes the schedule into another fiscal year, bringing a large set of expenses over with it. The board wants to avoid this. A decision must be made that weighs the pros and cons of pursuing implementation before the audit versus the delay of the implementation until after the
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• Cost. The project has already run over budget, so cost is a major factor in the decision going forward.
• Quality of data. It is very important that the financial outputs (i.e. reports) reconcile and are accurate. Otherwise, the auditors will penalize the hospital and the reputation of Riverview will suffer.
• Risk. With the implementation being eight months behind schedule, there is no room for error.
• Effect on Human Resources. The morale of the staff has been negatively impacted both from failures of the old system and the perceived complexity of the new system. The decision should take them into account.
Postpone implementation until after the audit

Advantages:
 Effects on HR: The hospital staff is able to focus on their duties during the time leading up to the audit without the distraction of the new system.
 Risk: This solution is mitigates the risk of running two systems in parallel and not being able to reconcile both systems before the audit.
 Cost: Avoids additional auditing fees that could run as high as 15,000$

Disadvantages:

 Time: Postponing implementation until after the audit will take the project into the new fiscal year. This will cause loss of confidence on the part of the board of directors and further frustrate the employees who do not see an end to this implementation.
 Cost: There is no guarantee that the implementation will be easy after the audit. It may be costly and without a sense of

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