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Sinosecurities Postscript

Sinosecurities.com Postscript. Ken Peffers UNLV March 2004. What is the important management issue or problem in this case?. Should OSIL have taken on the Sinosec contract? How could OSIL have managed the Phase 1 of the contract to avoid the problems it encountered?

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Sinosecurities Postscript

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  1. Sinosecurities.comPostscript Ken Peffers UNLV March 2004

  2. What is the important management issue or problem in this case? • Should OSIL have taken on the Sinosec contract? • How could OSIL have managed the Phase 1 of the contract to avoid the problems it encountered? • Should Sinosecurities walk away from Phase 2 of the project?

  3. Material facts: • Sinosec contract was 26 pp. • Functional objectives were 3 pp. in bullet points. This included mention of the online brokerage platform with TP gateway to Shenzhen and Shanghai Stock Exchanges. Also, trading interface with multi currency functionality. • Four payment installments, based on milestones. • Phase 1: designing and coding the platform and beta testing with the Shenzhen Stock Exchange and four local brokerages. • Phase 2: upgrading the gateway to include set-top box transaction and full AMS/3 compatibility.

  4. Material facts: • OSIL cautioned steering committee that adding set-top box and AMS/3 compatibility would be extremely difficult. • Sinosecurities adamant about maintaining them in the specs. • Minor interface changes set the project back 1 week and added 1 ½ man months to the project Phase 1 • Sinosecurities never remitted second and third $100,000 payments. Resulted in loss of $156,800 for OSIL. • OSIL decides legal action not viable.

  5. Causes • Inadequate project specification. Neither contract nor systems analysis produced adequate specifications. • OSIL agreed to specifications that it thought were infeasible. • Separation of sales and development??? • OSIL discovered the infeasible specs when it reviewed the specifications

  6. Recommendation • Should Yang have walked away from the project when he discovered the feasibility problem? • What should he do now?

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