Risks in Implementing the Project Deductive Technology - Essay Example

Deductive Technology Table of Contents Project Overview 2 Risks in implementing the project 6 Steps to mitigate risks 9 Project Plan 12 Financial Plan 14 Change Management 17 Project Overview Deductive technologies, one of the biggest providers of assistive technology help children having special educational requirements in UK. The company has been successful in earning the second leading position as one of the biggest ‘independent supplier’ in the industry of ICT devices. The company develops certain educational software equipments which enable children with special needs to upgrade their knowledge base. With the help of such sophisticated equipments, the company aims at helping the children adopt certain skills which in the long run would help them to understand the cause-effect relationship between different incidents and would also enable them to become familiar with numerical figures. The company wants to expand its presence across US, which has been estimated to have a market size of nearly six times than the UK market. As per the estimations of the company, the US market is estimated to offer a much greater growth potential than its UK counterpart. Though the company has set up a subsidiary unit in US, but it wants to tap the entire demand of the market. Moreover, the company is also eager to penetrate into the smaller markets like Canada and Australia. This makes it essential for the company to upgrade its technology processes and also the existing resources available. To meet the challenges of expansion, the company has identified the need of corporate restructuring and an absolute necessity of integrating the various facets of its operational processes. As per the management, in order to meet its underlined growth objectives in terms of sales, the company needs to bring about significant developments in its processes. The company had decided to strengthen its marketing operations and integrate the various business operations so that they would be able to easily foray into any international market. As a project manager, it is important to adopt strategies by which an overall integration of the different functional operations of the company with the help of developed software tools is achieved as that would help the organization to strengthen its marketing strategy, which is vital for the adoption of an aggressive growth strategy. Such a strong marketing network would enable the company to procure more orders and meet the deadlines. This would enable the company to gain access to more projects which in turn would steer the company’s growth. The company wants to adopt a business reengineering process to bring about an overall corporate restructuring. This is necessary as that would help the company to bring about a change in the way the processes are carried out in an organization and would help the company to improve the present nature of activities. The company seeks to integrate the enterprise systems with a newly developed electronic shop. This would enable the company to track the alterations that result due to changes occurring in one of the business operations and the effect of such a change on the other processes of the company. To ensure that the company is able to witness growth, the company wants to improvise the nature of customer service provided to its clients and customers. This would help the company to generate increasing number of customers and strengthen the brand loyalty of the company on the long term. Moreover, the company is keen to develop a VPN network which would help it to maintain a coordination between the various operations carried in the UK and US locations. This would help the company to adopt proper measures in order to maximize the benefits that can be reaped as a result of such operations. The company had determined that it needs to bring out specific changes within the different operations of the company in order to witness a 10% year on year growth from the forthcoming financial year. It was planned that such changes would be brought about within a span of two years but the company changed its plan and decided to bring about the necessary improvements within July 2009. So, this called for a thorough analysis of the different activities that were planned as vital components for the success of the project. As the time span was reduced considerably for the implementation of the necessary changes, the management had to undergo a thorough analysis to understand and thereby identify the activities which are necessary and vital for the success of the project and the need to eliminate those processes which are redundant and costly. As a project manager, the prima facie objective is to find out those activities which are crucial for the successful implementation of the project and in the long term would help the company to meet the underlined project objectives. So, the most crucial matter was to streamline the activities and various processes to meet the end objective. The company has primarily planned to carry out an in depth analysis of the activities it needs to carry out in order to meet the project objectives. Broadly, the management had identified about 27 such activities which would help the company to meet its underline objectives. The process would take a long time and tracking the activities and their due compliance would make the matters cumbersome and tough to keep track of the entire development. Moreover, it would not be possible for the management to adhere to all such activities and successfully meet the underlined project objectives within such a short span. So, there was an absolute necessity of cutting down the redundant activities which would make the project cumbersome. The important and the most essential activities needed to meet the project objectives should be identified by the management and the necessary changes implemented accordingly. The project can be achieved by underlying the stages that it needs to follow in order to complete the project within the assigned time: Planning: Planning forms the backbone of every project and on it depends the success of any project. So, it’s of utmost importance to develop a proper planning schedule which would help the company to utilize its available resources effectively. As the project was initially meant to be completed within a span of two years but now due to certain unavoidable circumstances, the management has decided to cut down on the time and complete it within July 2009, so its necessary to identify the most important and crucial tasks to complete the project and eliminate the redundant activities (The Deductive Technologies case study, n.d.). This would help in streamlining the work activities and also enable in developing an appropriate work structure. Such a breakdown of large activities into small work activities would help the company to meet the project objectives easily. As time poses a major constraint, so many work activities should run simultaneously which would help in achieving greater outcome within a shorter span of time. In order to estimate the progress of the project, appropriate measures has been taken to track the progress of the report and whether each work activity is getting completed within the pre-determined time period. Execution: To ensure that the project objectives are met, quality checks are set up. This will ensure that the project is progressing according to the set specifications. Any sort of alteration or deviation from the set standard can also be detected readily and steps can be taken accordingly to prevent such occurrence in the future. Strict vigilance of each work activity will help the company to readily attain the project objectives. To implement the project suitably, the company needs to hire human resources. These people need to be given training so that they can meet the project objectives. This has to be done in a systematic manner so that no mis-communication results about the responsibilities that they need to carry out in order to timely complete the project. Regular track of performance will be done in order to ensure that the progress of the project is in accordance with the pre determined project schedule. This will minimize room for further errors and will lead to the completion of the project on time. It is not possible to follow the plan, initially outlined for the completion of the project, as that consists of a lot of sub–activities. So some of the activities are reduced or merged with the following activities. Out of the total activities listed, some are carried in-house and some are outsourced in order to save time and also to accommodate the fact that the company does not have all the available resources needed to complete the project. Risks in implementing the project Every project suffers from risks and this project being no exception is also supposed to suffer from some potential risks. To understand the various risks that the company might face on implementing the changes, the company needs to undergo a thorough feasibility study. This would help it to understand the potential risks that the company might face in implementing this project. To implement a project successfully, it needs total cooperation of the top management. The top management must be aware of the entire progress of the project and must adopt measures in order to make the project a success. So, though it has been the decision of the top management to initiate such a project but to carry out the implementation of the project in a successful manner, the top management needs to get involved with the details of the project execution. Otherwise it might pose as one of the biggest constraints to the successful execution of the project. Moreover lack of experienced people might hinder the success of the project. The idea of the project was developed by a senior manager who left the company due to some unknown causes. He was replaced by two young less experienced people, so they might not be able to understand the decisions that they should take in order to ensure smooth progress of the project. This might also act as one of the major barriers to the effective execution of the project. To meet the underlined objectives, the company needs to build operational competencies in the areas of ‘ICT strategy development, Software Requirements Specification and Business Process Modelling’ as they lack the necessary competencies needed to meet the present demand of the organization. Developing such in house expertise would make the process a lengthy one and the company would not be able to meet the deadline of implementing the project within June 2009. In order to do so, the company needs to analyse and interpret the importance of these operations and the role played by them in hastening the successful implementation of the project. If it is found that these operational competencies are vital for the company to meet the deadlines, external experts must be hired to meet the operational challenges. But the company needs to adopt strategies by which it can bring about the necessary changes within the pre-determined budget. Financial risk is one of the greatest challenges that the company can face as a result of such project implementation. The company needs to allocate funds appropriately so that it is able to carry out all the operations of the project accordingly. The company can also face technological risks as the success of the project to a large extent depends on the expertise needed to develop the VPN accordingly. With the help of this advanced technology the company would be able to successfully carry out the expansion plans. To upgrade the technology in order to meet the company’s requirements, the company might have to hire external experts. This would again increase the cost of developing such technological competency. So, at every step the company might face an acute shortage of funds which might jeopardize the implementation of the entire project. Another potential risk to the successful implementation of the project was whether the company would be able to meet the underlined project objectives within the scheduled time frame. Managing time effectively without compromising on the set objectives poses as one of the vital challenges to the successful implementation of the project within the company. The company needs to identify the essential activities which it needs to emphasize in order to meet the project specifications. The company needs to assess whether it faces any legal risks of implementing this project. It needs to adhere to the privacy and security norms while developing the sophisticated software devices which are fundamental for the growth of the company. The company should analyze the legal risks which it might encounter due to its decision of implementing the project within such a short span of time. To bring about such an overall restructuring, the company should be able to interpret whether the employees feel a sense of involvement to the project objectives or whether they are alienated as far as the development and its implementation are concerned. This may also pose a vital challenge for the company because to bring about any successful change within an organization, a company needs to increase the levels of employee engagement. If the employees do not feel motivated and display strong resistance against such changes, then it would become absolutely impossible for the organization to implement such changes. Moreover, the company needs to interpret whether it would be able to encash on the opportunities that it intends to exploit in the future with the help of the activities it has adopted to meet the project objectives. Adoption of irrelevant activities to meet the project objectives would block the funds in such operations. This might lead to abnormal dearth of funds in completing the project. SWOT analysis and Marketing audits (both internal and external) would take a lot of time and increase the expenses borne by the company , so the company should find out alternative methods to ensure that it is able to complete the project as per the predetermined deadline. Steps to mitigate risks To understand whether this project would help the company to witness further growth, the company needs to undergo a thorough cost benefit analysis. This would help the company to estimate whether the benefits of implementing the project outweighs the costs incurred in developing the project. This would help the company to understand whether the project is economically feasible or not. Moreover, the company should adopt suitable measures to allocate its funds accordingly so that it does not face a dearth of funds while implementing the project specifications. The company should prepare a rough budget and specify the amount of expense that should be done in each of the processes to successfully implement a project. While developing the company’s software and upgrading it accordingly to meet the long term growth objectives, the company should abide by the privacy policies and adopt strict measures to adhere to the security measures so that no infringement of data occurs, otherwise it might give the competitor’s scope to develop advanced technology devices and capture a greater share of the market. The company must use developed software to estimate the time it should invest for completing each activity of the project so that it can complete the project within the pre scheduled time. Effective time management is key to the company’s success in meeting the underlined objectives of the project. Monitoring of relevant activities should be done on a periodical basis to understand the nature of improvement that has been achieved and whether the necessary processes should be hastened to bring about such change within the predetermined time slot. The company should also maintain strong relationships with its suppliers and vendors so that it remains updated about the progress made by them and can accordingly adopt strategies in order to meet the underlined project objectives within the predetermined schedule. This would also help the company to ensure that whether the company is able to adhere to the quality standards as that plays a vital role in determining the success of the project. The company should emphasize on those activities which play a determining role in making the project successful. To minimize the chances of resistance brought about by the employees, the management should communicate the need of bringing about such change within the organization and how it would help the employees to improve their career prospects. The top management should clarify the objectives of implementing the project and how it proposes to steer the growth of the organization. This would minimize the resistance that the employees might put up due to such a change being brought about in the organization. Risk Assessment Table Risk Description Process of mitigation 1 Less involvement of top management Employees might lose interest and that would hamper the smooth progress of the project. 2 Lack of skilled employees Need of clarity about project details and the modes of execution 3 Time constraint Effective time management by breaking huge work activities into fragments and allocating time for completion of each activity 4 Security of software The software can be hacked if proper security measures are not taken. So tight security measures must be adopted. 5 Proper selection of appropriate software It is necessary to develop a unique software so that the company can build on its competitive advantage. 6 Realtionship with suppliers Supplioers must be treated as partners and the progress of the project should be conveyed to tehm coordination of the company’s activities with the suppliers is of absolute necessity. Project Plan To accomplish the project within the stated duration-i.e within the end of July 2009, many activities that were outlined by the company initially were eliminated and some of the functions were also outsourced. Many of the sub activities were outsourced to companies which would enable the company to complete the task within the predetermined schedule. With the help of excel sheet, the time that will be taken by each task and sub tasks have been outlined. To accomplish the project deadlines, the company needs to identify the potential companies where it can outsource the tasks. This would help the company to invest more time on the more important tasks which has been shown in the excel sheet. Proper coordination has to be maintained with the suppliers and the vendors in order to adhere to the specified project details. To meet the project deadlines, the management plans to invest on training the staffs. This will help the company to meet the project objectives and ensure smooth flow of operations. The excel sheet will help the management to understand the time that must be taken by each activity to complete the project on time. Exhibit I Deductive Case Solution Total Project Completion Time Start Date End Date Activities 129days 2-Feb 30-Jul Induction and Review Company’s Strategic Direction 6 days Conducting feasibility study 3 days 2-Feb 4-Feb Sit with the directors and explain the situation 3days 5-Feb 7-Feb Modelling Business Processes 8 days Visit some customer sites, attend Exhibition and / or Trade Show 2 days 9-Feb 10-Feb Shadow dispatch / warehouse staff to gain understanding of current product range and document, stock movement procedures. 4 days 11-Feb 14-Feb Seek agreement from Key staff that documentation is correct 2 days 16-Feb 17-Feb Marketing Audits – Internal and External 10 days Internal Audit 6 days 18-Feb 24-Feb External audit 4 days 25-Feb 28-Feb IT strategy development and IT management 12 days Gather requirements for a virtual private network (UK & US) 3 days 2-Mar 4-Mar Review current IT system management procedures 4 days 5-Mar 9-Mar produce an integrated business systems model of current operations plus problem areas 3 days 10-Mar 12-Mar Produce outline design of new proposed integrated set of business systems 2 days 13-Mar 14-Mar Completing the Requirements Specification 9 days Research pool of potential software provides 4days 16-Mar 19-Mar Produce version 1 of proposed IT strategy document including software, hardware and IT management plans. 5 days 20-Mar 25-Mar Selecting the software application 6 days Manage software selection and vendor in conjunction with senior Company partners and Academic Supervisors 4 days 26-Mar 30-Mar Draw up Implementation plan with chosen software vendor 2 days 31-Mar 1-Apr Software selected 2 days 2-Apr 3-Apr Business Process Restructuring 5 days Establish and document work flow procedures for SOP, POP and stock control modules of the selected application, using process flow software.(Interviews with product vendor and Senior management) 3 days 4-Apr 7-Apr Compare new procedures with integrated business systems model of current operations and establish scope & impact of change and propose Change Management Plan 2 days 8-Apr 9-Apr Preparation for Phase 1 ( SOP , POP and Financial applications) Implementation 8 days Review Change Management Plan 3 days 10-Apr 13-Apr Prepare all staff for implementation process (meetings / briefing sessions) 4 days 14-Apr 17-Apr Establish and document additional software requirements 1 day 18-Apr 20-Apr Phase 1 Restructuring Work Flows 12 days Review and communicate Change Management Plan and new procedures to staff via team meetings and workshops. 8 days 21-Apr 29-Apr Carry out go live simulation – A day in the life of Deductive Technology using new procedures 2days 30-Apr 1-May Agree plans with senior managers and Vendors to resolve system problems and people issues 2days 2-May 4-May Phase 1 Implementation 8 days Working with software vendors review implementation plan & manage the implementation 5 days 5-May 9-May Review information management / backup procedures 3 days 11-May 13-May Phase 1 Implementation review and fine tuning 2 days 14-May 15-May Specification of a Virtual Private Network (Phase 2) 7 days Identify potential VPN Hardware suppliers, submit specification, evaluate solution and choose vendor 4 days 16-May 20-May Evaluate potential solutions and choose Vendor 2 days 21-May 22-May Draw up VPN implementation plan 1 day 23-May 23-May Implemtation of a Virtual Private Network 5 days Install 3 days 25-May 27-May Communicate new procedures to staff who will use applications over VPN 2 days 28-May 29-May External Audit : Undertake a detailed audit into Deductive Technology’s market 5 days 30-May 4-Jun Market Research and Information 8 days Prepare a research proposal to carry out market research to identify market opportunities. 6 days 5-Jun 11-Jun co-ordinate and present findings to the Management team. Include a review of any resources for product / market development, identification of critical success factors and identification of target market sector 2 days 12-Jun 13-Jun Marketing Strategy 4 days Develop marketing sub-strategy to achieve the target growth in sales / profits 3 days 15-Jun 17-Jun Develop outline a marketing programme, plans for the implementation of strategy and sub strategies, resources, timescales and budget implications, expenditure justification. 1 day 18-Jun 18-Jun Preparation for Phase 3 (Electronic Shop) Implementation 5 days Tools selection. 2 days 19-Jun 20-Jun Devise phase 3 implementation plan with key staff and communicate it to staff involved 3 days 22-Jun 24-Jun Phase 3 Implementation Visual 5days With ISP manage implementation of web hosting requirements. 3 days 25-Jun 27-Jun Document web hosting information and communicate procedures to operational staff 2 days 29-Jan 30-Jun Phase 3 Implementation Procedural 8 days Write programmes to produce input and output linkages to main financial and SOP applications using ODBC and SQL. 6 days 1-Jul 7-Jul Review information management / backup and system operation procedures. 2 days 8-Jul 9-Jul Phase 3 Implementation review and fine tuning 5 days Use tools and write programmes for capturing and interpreting web site visiting statistics, particularly non-purchasers, using tools provided by ISP to download into Access database 3 days 10-Jul 13-Jul review web site promotion and search engine placement strategy and carry out any necessary remedial action. 2 days 14-Jul 15-Jul Manage the implementation of the approved marketing programme. 4 days Implement market development elements of the marketing programme for current and proposed markets 4 days 16-Jul 20-Jul Preparation for Phase 4 (Semi automatic production of Catalogues) Implementation: Gathering and documenting technical, functional and business requirements, through interviews with key staff and print supplier. 3 days 21-Jul 23-Jul : Phase 4 Implementation 2 days 24-Jul 25-Jul Monitoring, Evaluation and Procedures 4 days 27-Jul 30-Jul Financial Plan The financial plan of Deductive Technology is devised to understand and suggest the necessary financial adjustments which are essential because of the change in planning and requirements. The financial plan is based on the expected expenditure as proposed in the document and the expected inflow in terms of savings and gains. The new technology that is to be incorporated is expected to result in savings and gains over a period of time of five years. The expected cost of the project is estimated at £ 71,600(The Deductive Technologies case study, n.d.). The company has the following break up in terms of cost: Sl. Description Estimate of costs (£) 1 Project management fees 10,000 2 Staff training in software use 5,600 3 Software purchases 40,000 4 Software server and E-Commerce / Web server 10,000 5 Fixed link Telecommunications Connectivity 6,000 T O T A L 71,600 Though the cost of the project seems to be of considerable amount, the expected benefits are also very lucrative. At the first place, the project would help the company to gain considerable market share in the United States and among the English speaking nations and populations. Also, the benefits are expected to range for next five years. The expected savings and gains for the project for the next five years are as follows: TASK Description Savings and Income (£k) Total Year 1 Year 2 Year 3 Year 4 Year 5 4 & 11 Savings by not outsourcing IT support, redesigned work flows requiring 2 less staff. Growth: able to process more orders 144 15 30 32 33 35 11 Improved management information better planning information and inventory control 100 10 20 20 25 25 13 Improved management information better planning information and inventory control 79 3 18 18 20 20 21 Access to new markets via e-shop in other English speaking countries = £200k Efficiency savings in Telesales = 1.5 staff member over 3.5 years £87k, 287 0 37 50 100 100 22 Increased information and tracking from website (Savings on targeting of sales effort to existing customers and site visitors) 29 0 5 8 8 8 25 Automated generation of catalogue, reduction in staff time equal to 0.5 of staff member over 3.5 years 39 0 6 11 11 11 23 Improved marketing activities generating new sales. 125 0 0 25 50 50 TOTAL 803 28 116 164 247 249 The analysis of the financial plan is made on the terms of discounted cash flow and pay back period as cash flows range over a time period of five years. Discounted Cash Flow is the mechanism to analyse future cash flow by discounting them as per the cost of capital (generally, WACC) to find the present value. If the present value of the future cash flow is more than the present cost, the company should go ahead with the project. Payback period is the time by when the company can expect to have positive return on investment from the project initiated. For the purpose of financial analysis, the rate of discount is assumed to be 8% per annum. The maintenance cost of the project for the next five years is assumed to be £ 8000 (for 1st year), £ 10000 (for 2nd year), £ 12000 (for 3rd year), £ 14000 (for 4th year) and £ 16000 (for 5th year). The following table describes it: The analysis says that the incurring £ 76,100 (as the project cost) and £ 40,000 over a period of next five years (as maintenance cost), the company is expected to generate £ 488,296.77 (at present value of money) by the end of fifth year. It is convincingly suggestive that the company should go on with the project. The revised financial planning of Deductive Technology should involve allocation of more money to the tasks that would enable the company to have more of savings and gains. The company should have due allocation for the training of the staffs and marketing strategies. Change Management To implement a project successfully in the organizations, certain changes or up-gradations needs to be brought about in the processes or operations. Such an improvement is necessary for the organization to meet the long-term objectives of witnessing approximately 10% year on year growth. Such changes would not only strengthen the company’s competitive edge but would also in the long run help the company to gain a leading position in the US market. To sustain in today’s competitive environment, all organizations need to undergo certain changes as far their operations are concerned. Deductive technologies, being no exception, have to upgrade its present level of operations in order to bring about necessary modifications in its processes which would help the company to meet the challenges of the competitive market. When an organization decides to undergo a ‘change’, it is always associated with certain resistance from the various stakeholders of which employees play a major role. Deductive technologies need to acknowledge the fact that to bring about a successful change within the organization, the employees need to play a vital role. An organization cannot bring about any change without the full cooperation of its employees. It is the employees who help a company to adapt to such changes bringing about an overall organizational development. If they built up a strong resistance against such change processes, which generally occur when the employees become aware of such a change process, then it might jeopardize the total restructuring planned by the organization. The employees must be convinced that such a change will benefit the organization in the long term. To make the change process a successful one, it is necessary for the management to gain the trust and total confidence of the employees. Any sort of alteration when brought about in an organization stirs feelings of insecurity amongst the employees and they start fearing that such a change would be associated with layoffs and downsizing of the organization. Moreover, when the employees become aware of the company’s interest in developing software devices, they feel that may be the company is trying to replace the manpower with the help of sophisticated devices. Such fears and insecurities might lower the morale of the employees and they might start losing interest in the operations of the organization. To avoid such occurrences, the top management needs to clarify the objectives of initiating such a project and the developments that would be associated after the successful execution of the project. To minimize the insecurity of the employees, the company must adopt measures to gain the trust and the confidence of its employees. The management should adopt measures in order to minimize the resistance in implementing the project from its stakeholders. The management must hold periodical meetings with the employees to understand the progress of the project and analyse the future methods of completing the project. The management must acknowledge the fact that employee involvement is vital to the successful execution of the project and so it should motivate the employees to place their suggestions. Depending on the suitability, the management must try to incorporate the suggestions made by the employees while chalking down their future action plan. This will help the management in speeding up the rate of progress and that will in turn make the accomplishment of project objectives easily achievable. Change is brought about in an organization to improve the existing processes and practices carried out in it. The management had decided to bring about an overall corporate restructuring which needs improvisation of various practices carried out in the organization. Proper training schedules have to be designed to upgrade the skill base of the employees so that they can carry out the responsibilities needed for the smooth execution of the project. The management needs to adopt proper measures in order to improve the technological expertise of the company as its needs to develop unique software which will enable the company to build its niche in the US market thereby helping it to expand its operations. While bringing about a change within the operations of the company, the management must try to interpret the response of the employees about the adopted change process. This will help the management to ensure that the employees do not get dissatisfied or that does not lead to grievance building as that might adversely affect the employer-employee relationship which will have deeper negative repercussions in the future. Reference The Deductive Technologies case study, No date Bibliography Bainey K. R., 2004. Integrated IT project management: a model-centric approach. Artech House Barkley B., 2004. Project risk management. McGraw-Hill Professional Cook S., Macaulay S. and Coldicott H., 2004. Change management excellence: using the four intelligences for successful organizational change. Kogan Page Publishers Elearn. 2005. Change Management. Elsevier Gray C. F. and Larson E. W., 2002. Project management: the managerial process. McGraw Hill Professional Harrison F. L. and Lock D., 2004. 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