Developing An Information System For Reliable Finance Company

Stakeholder Analysis

The Reliable Finance Company (widely known as the RFC) is an Australia based financial organization that lends money to individuals. The   organization  started  operating from one of the  small towns of the  country  in the year 1990 and has  grown steadily  over the years   to such an extent that at present there are as many as187 branches of the organization  located   at  several nooks and corners of  the country.

This report has been documented with the aim of providing an outline of the project aimed at developing an information system for RFC that would be capable of supporting the transaction system utilized   for the processing, payment and settlement of loans.

The stakeholders associated with the project under consideration are being outlined in the section below:

1. The clients of Reliable Finance Company who take loans from the organization and repay the same.
2. The branch personnel in charge of managing the customer loan repayment process.
3. The officials and clacks associated with Home Office Payment Processing Department, as they are responsible the centralized management of all loan accounts.  

Bryce Clarkson, the current owner of the Reliable Finance Company has expressed his interests in re-designing the payment processing system that currently exists in the organization.  Clarkson is of the  opinion that this  redesigning  process would  allow the  organization to  move on step  closer  to  the process of  implementing an  information system  for  the management  of the entire payment system, which would  in turn facilitate his plans  of  expanding the  operations of RFC.

 At present, the following three systems are utilized across all the branches of the Reliable Finance Company for the successful processing of loan requests and their repayments:

1. The Payment Processing System:The Payment Processing System, as the name suggests is associated with  the management  of  the payments  made  by  the customers,  along  with maintaining  the records  of  the same.  This  particular process  I also associated with  the  process of   updating  the  loan records and files   of each  customer as maintained  in  the head   office.
2. Delinquency Analysis System: It is an automated system that considers the data recorded in the Outstanding Loans File, as maintained by the Home Office Payment Processing Department and  identifies  those customers  who have  not paid their loans after 15, 30, 45, and 60 days of  the due date. In the next step, computer generated reminders are sent the customers informing of their delinquency.
3. Settlement Accounting System:  The settlement accounting system is utilize for calculating  the  settlement amounts   in case a customer  expresses his or her interest  in paying   off  the entire  loan amount  before the due date.

  The information included in the section above is indicative of the fact that both the Delinquency Analysis System and the Settlement Accounting System have already been automated.  Moreover, then efficiency of these two systems depends significantly on the outcome of the Payment Processing System, which, as of now, is managed manually. In fact, the current owner of the organization, Bryce Clarkson has instructed the MIS department to redesign the payment processing system that currently exists in the organization.  Hence, the project being discussed in this report would essentially take into consideration the Payment Processing System of RFC.

The following elements are included within the scope of the project under discussion:

1. The identification of the major steps associated with the Payment Processing System currently utilized by Reliable Finance Company.
2. The identification  of  the changes that  can be include in the  existing  system   such that the  issues currently associated  with the same can be  resolved.
3.   To define the changes to be include in the existing Payment Processing Systemof RFC through the development of the ‘To be’ process model.

 However, the following elements are not included within the scope of the project:

1. Redesigning the Delinquency Analysis System and the Settlement Accounting Systems currently utilized by the Reliable Finance Company.
2. The implementation of the changes recommended for redesigning the Payment Processing System currently utilized by Reliable Finance Company.

 The following diagram provides an insight into the operational steps associated with the payment processing system.

Figure: Current process model for payment processing (BPMN model)

Figure: Current process model for payment processing (UML Activity diagram)

As shown in the figures above, at present,  the customers  are  capable of paying  their  loan amounts at both  the home branch or at  the home office  branch  of  RFC. Outstanding Loans Files are managed separately at both the home branches and the home office for each of the loans taken by the customers.  However, an Advice of Payment Received (APR)  is maintained at each of  the offices: the  same  is  updated for each  of  the  payments made  and  are then  mailed (to  the home office if the payment  is made at the  home branch and vice versa)  for making   updates to the Outstanding Loans Files. Besides this a batch payment processing system is also run at the end of the day for updating all customer accounts centrally.

Project Scope: Project Description

  It has been  mentioned  in the case study that  although  about 80 percent  of the loan  payments are made  at  the home branches, the payment voucher indicating thee detail of  the payment are often   found   to  be missing from  the voucher  booklet in half  of the  cases  which makes it difficult  for the Home Office Payment Processing Department to  track the payments.  The management of the unidentified  payments leads  to severe clerical   work pressure, besides  delaying   the  posting  of   the payments  in the respective customer accounts  which in turn leads  to the generation  falsi-positive delinquency messages.  Excessive clerical overhead occurs   significantly in the process, courtesy to efforts required for managing the loan documents manually. Besides this, the Outstanding Loans File is often found to be outdated, which hampers the Delinquency Analysis process even further.

  Such being the circumstances, the following changes are being recommended so as to be included in the payment processing system:

1. The development and implementation of a centralized Outstanding Loans File that can be   accessed and updated from all the branch offices and home office (Oliveira & Belo, 2012, December).
2.   The online generation and processing of a centralized APR File

 The news process model for redesigning the existing payment processing system is being depicted in the figure below:

Figure: New process model for a re-designing payment processing system

BPM modelling technique

  Following are the strengths of the BPM modeling technique:

1.  It  acts a tool for understanding   the  primary  elements of  any existing  system, along with the identification of the  strategies/ techniques that can  be utilized for the  enhancement  of  the system , besides facilitating   the  process  of  planning (López-Campos et al.2103).
2. The BPM modelling technique also allows the graphical representation of the proposed   model, thus providing   the end users with an idea of the step through which the proposed system would function.

  However, the BPM technique has several weaknesses associated with it, the first   one being the fact that there exists a very high probability that the process under design is overanalysed, thus making the task   of proposing a new model significantly critical (Snoeck et al. 2015).

 The UML modelling technique provides the user with the advantages of providing graphical representation   of any process   under consideration. It allows for the documentation and graphical representation of the process models, thus developing a common language of communication with the client organization (?abiak et al. 2012).

 On the other hand, the utilization of several different models for representing   any   process often makes the process of maintaining   consistency   of   the designing process. Hence the BPMN technique is preferred more over the UML modelling technique (Evans et  al. 2014). 

The following technical and business complexities are likely to be associated with the project under consideration:

Conclusion

The most important aspect of this project would be to redesign the payment processing system that currently exists in the organization.

It is worth mentioning that the Reliable Finance Company has operational branches running across all major cities of the country, including Sydney, Brisbane, Melbourne and Adelaide.  Thus recommendations have been made to the owners of the organization to   implement a centralized outstanding Loans File that can be   accessed and updated from all the branch offices and home office. It is expected that the centralization of the loan documenting process would indeed help in the process of overcoming   the issues that the organization currently experiences.

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