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This system design phase includes the following steps:

1. The analyst should specify the file structures, storage devices etc.

2. The database is also designed in this phase.

3. Hardware cost, capability, speed, error rates, and other performance characteristics are specified.

4. Changes to be made in the organizational structure of the firm are outlined.

5. Input, output, files, forms and procedures are planned.

6. Finally, standards for testing, documentation and system control are formulate

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