BSYS 2050
Lecture 1
What is the purpose of Excel?
• To organize data in an easier way
• Calculations
• Business intelligence
• Forecasting
• Scenarios
• Simulations
• Understand data more easily
• Help give your business answers
• Make business run smoother
• To make better decisions!
Lecturer: Cyri Jones
• Office Hours:
• Wednesdays, 7:30 to 8:30 a.m., 2:30 to 3:00 pm
• SE6-360
• Course Website:
• https://zenportfolios.ca/bcit-bsys-2050-2015/
• Course Outline:
• http://www.bcit.ca/study/outlines/20151072507
• Contact:
• Office: 604-451-6743
• E-Portfolio: https://zenportfolios.ca/cyri-jones/
• Twitter: @cyrijones
• Labs:
• I will be lab instructor for ITMG 2A, Masoud Jalili will be the lab
instructor for INTT2A and INTT2B.
Course Approach
“There are no spoons,
only danger!”
Pirate by Sincere Stock, CC by 2.0
Starting a new venture?
• Who already has a business they are working on?
• Who would like to start a business some day?
• Good to have a “Plan B”
• It might end up being better than your Plan A
• E.g. Procurify example
http://www.procurify.com/
!!!!
http://www.techvibes.com/blog/growlab-announces-its-five-winter-2012-cohort-companies-2012-11-20
… another
BCIT grad
that pursued
his “Plan B”
http://www.nytimes.com/2008/01/13/business/13digi.html?pagewanted=all&_r=0
Tax Implications of Sole Proprietorship
Are you really a business? You must have a “reasonable expectation of profit,” can’t be using business to create a loss
You must have good record keeping and a start date
• Revenue
• Expenses
• $500
• - cell phone
• - Internet access
• Salary:
• - part of your rent or
• $40K
mortgage interest
• - part of your car
• - office supplies
• - $10 /yr domain
• - $70
• - $5500
• - 5K business loss
• ====
• $35K taxable income
• $1500 tax refund
Make it count!
• Why waste your time doing a fictional project when there
are opportunities in “real life”!
• Your project topic can be an idea to start up your own
venture of can be to help a real company or not for profit
organization develop an Excel what if analysis model to
help them launch a new product or service
• Developing a business model is a great way to see how
the business courses you are taking at BCIT tie together
Stephen Blank
Good to watch from 4 to 6 min. mark
http://uk.reuters.com/video/2012/05/02/steve-blank-on-entrepreneurship-part?videoId=234868221
Week 1 Lab
• Read:
• The Chapter 7 Handout (just below in this PowerPoint slide presentation) -- Knowledge with
Information Systems: Forecast Revenues and Expenses for the App). It’s just 8 pages.
• Set up your basic e-portfolio
• Find two pictures you can use for your e-portfolio, one horizontal oriented picture to be used for
your e-portfolio home page and one picture to use as your avatar. A good source of free pictures
is flickr.com/creativecommons. If you have some of your own pictures handy on your computer
or online then you can use those instead. Save your pictures on your desktop or somewhere
else handy so they are ready when the e-portfolio sign up process asks you for some pictures.
• Sign up for ZEN Portfolios so you can join the course website and collaboration area:
https://zenportfolios.ca/sign-up/ The sign-up code for a free account is bcit2015. It takes about
10 minutes to go through the registration process and create your basic e-portfolio. We will be
using the e-portfolios for the team formation process, to help see areas of similar interest for
venture topics and teams. Sign up is quite intuitive but you can get full step by step instructions if
you like here: https://zenportfolios.ca/instructions/. You can always edit later the info you use
when signing up.
• After you have registered with ZEN Portfolios, go to zenportfolios.ca and log in (on the right hand
side of the zenportfolios.ca site, about half way down). Join the course website group:
https://zenportfolios.ca/groups/bcit-bsys-2050-2015-business-analytics/ (just click on the Join
Now button). Once students have joined, your instructor will change the online collaboration area
to private so that only students in the course will be able to access.
Week 1 Lab
• There are two exercises for your Week 1 lab assignment
• Creating iPhone App Forecast of Revenue and Costs spreadsheet
using MS Excel 2010 (handout provided at lecture)
• Mitchell Oil chart (handout will be provided at your lab and will be
available on the course site as well)
• You may be able to complete the lab exercise during your
lab time but if you run out of time, you can complete and
submit to Share in by the beginning of your next week’s
lab.
Chapter 7:
Knowledge with Information Systems
Financial Forecasts
Source: Business Information Systems: Design an App for That, v. 1.0 by Raymond Frost, Jacqueline Pike, Lauren
Kenyo and Sarah Pels, FlatWorldKnowledge.com, http://catalog.flatworldknowledge.com/catalog/editions/514
Agenda
• Discuss the role of a business analyst in the development
process
• List pros and cons of on and off-shore outsourcing
• Estimate expenses for iPhone App Development
• Perform a sensitivity analysis
Business analysts act as intermediaries between
business units and developers
Marketing
Accounting
Business Analyst
(MIS Major)
Human Resources
Finance
Developer
Outsourcing Diagram
• Major Reasons for Outsourcing Activities
–
–
–
–
–
–
Cost reduction
Focus on core competencies
Increase quality (products or services)
Lack of internal skills or expertise
Entry barriers (equipment, technology, etc.)
Capacity
Estimating Costs
What Will You Earn Each Year?
Year 1
– You think you will sell 700 units of the
app in Year 1 @ $2/unit
– Apple collects 30% of each sale as
commission
Year 2
– You predict that sales will double in
Year 2 (still @ $2/unit)
Year 3
– You predict that Year 3 sales will
double over Year 2 sales (still @
$2/unit)
Now What Will You Earn Each Year?
Year 1 (more realistic)
– You must pay the Developer $3,500 to
develop your app. This includes
maintenance and bug fixes for the first year.
– You think you will sell 700 units of the app in
Year 1 @ $2/unit
– Apple collects 30% commission on sales
Year 2 (more realistic)
– You must pay the Developer $1,000 to
maintain your app.
– You predict that sales will double in Year 2
(still @ $2/unit)
Year 3 (more realistic)
– You must pay the Developer $1,000 to
maintain your app.
– You predict that Year 3 sales will double over
Year 2 sales (still @ $2/unit)
Group assumptions because they may change
Use formulas to generate information
Using formulas enables automatic adjustments
Sensitivity analyses show multiple assumption values and
resulting outcomes simultaneously
Use graphic design principles to format spreadsheets
Summary/Conclusion
• MIS professionals tend not to program; they serve as
intermediaries between the business unit and the
programmers.
• On and offshore outsourcing is a popular alternative when a
business does not have a dedicated programming staff.
• A business has numerous startup costs such as incorporation,
advertising, and so forth, which need to be forecast.
• Fixed costs are incurred even if no products are sold; whereas
variable costs are incurred only when a sale is made.
• Contribution margin is the money realized by the business
after paying variable costs.
Summary/Conclusion
• Spreadsheets should adhere to graphic design principles.
• Spreadsheets generate new information by use of formulas.
• Well designed spreadsheets group input variables into an
assumptions area. Ideally, the assumptions area is the only
place that numbers are typed.
• Formulas may be copied. However, cells that should not
change in a formula should be named.
• Your exposure can be analyzed in a sensitivity analysis using a
data table.