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ACME Project Charter
Due Date: August 20th, 2021
Table of Contents
1. Project Description 1
2. Business Objectives and Success Criteria 1
3. Stakeholders 1
4. Vision 1
5. Project Scope 2
6. Assumptions and Dependencies 2
7. Constraints 2
8. Milestones 3
9. Business Risks 3
10. Resources 3
11. Approvals 4
Revision History 5
Summary of ACME Project
Jackson, ACME’s chief executive officer, was concerned that the organization might be running its ventures wastefully. Ms. Jackson realized that running projects wastefully would lead to wastage of resources. Ms. Jackson has used statistical evidence from the pulsation of the proficient report conducted in 2018 by PMI to infer that poorly managed ventures were incurring losses of up to 12 percent for ACME by “not closing the gap between delivery and strategic design (Liu 2020).” Ms. Deidre was keen to pinpoint measures she could adopt in her project to lessen the wastage of resources. The CEO aims at enhancing the efficacy of her cost-saving method as part of the project but has to make sure that the venture is correct.
The cost of implementation will be exceeded by the amount of money Ms. Jackson wishes to save to advance the organization’s efficacy. Ms. Xue helps Ms. Jackson improve the design of her project as she is skilled in management. The ACME project would need investment, and Ms. Jackson has to determine if the venture is worth it.
The ACME project will heavily impact the internal management of developments. The organization will save on finances with improved efficacy; thus, the cost of running a project will be lower (Mueller et al., 2017, September). The decrease in the cost of running a project will enable the organization to shift the resources to enhance the quality of a project.
Undesirable effects of the venture can be observed internally. This would lead to job losses as increased productivity would mean unproductive personnel has to leave. Also, advanced productivity may result in a lack of motivation as the person may feel they are forced to operate under pressure to cut costs (Mueller et al., 2017, September). Finally, concentrating much on productivity may influence the director’s decisions as they may perceive they are under pressure to execute downsizing measures.
The project would result in increased delivery periods; thus, the company is affected externally. Increased productivity would profit clients as their ventures would be delivered on time, leading to a reduction in their waiting period (Liu 2020). The clients would then feel the urge to use the company’s products due to the level of productivity; thus, the company’s image is enhanced. The major assumptions of the ACME project are that the execution of the measures would automatically lead to a decline of operations.
The outbreak of Covid-19 has affected the running of the project; thus, for the project to continue cutting operational costs, unskilled personnel has been laid off for efficiency to be constant and consistent. Covid- 19 led to a shift of operations to online; thus, many technology and project management information systems have been highly utilized during this period (Carota 2020). ACME has requested the company to offer consulting services to aid with the advance of their CXS software. The advancement is to help ACME to install the additional languages.
Business Objectives and Success Criteria
The critical business objectives employed by the project are (Monsur 2018):
To upgrade to CXS v12
2. To modernize the system and utilize the new functionality in v12 so that ACME can take on more daily reporting and administration without relying on the organization.
Business objective
Product
Criteria of success
To upgrade to v12
• The customizations on the existing site are 23 that are to be re-built for the advanced site.
• Like for identical outline of workstations, handler accounts, and account profiles.
• Like for similar transference of end operator pages from existing site to advance position (innovative v12 functionality may offer prospective developments and when approved by ACME these may lead to small deviations to the advanced pages).
o Following UAT ACME sign-off of v12 is advanced.
o on 3rd March 2022 the launch will occur successfully.
To advance to v12 to help the advertising to operate wholly.
• The customizations on the existing site are 23 that are to be re-built for the advanced site.
• Like for identical outline of workstations, handler accounts, and account profiles.
o Following UAT ACME sign-off of v12 is advanced.
o on 3rd March 2022 the launch will occur successfully.
To rationalize the scheme and use the innovative functionality in v12 so that ACME can take on more daily reporting and administration without depending on the support of the organization
• Advanced OneClick facility for call Centre usage.
• Advance to v12 to utilize client cPanel.
• Training for ACME agent trainers and call Centre trainers.
• Evaluation of law base eliminating superfluous instructions and verifying remaining guidelines.
o ACME structure administrator able to create;
a) Laws
b) Announcements
c) Reports
The measurable criteria that can be used to justify the success of the ACME project include the following:
Schedule: the success of the ACME project is to be measured against the project schedule. The project is a success if it is within the schedule. If the milestones align with the agreed dates, the project is said to be a success.
Quality: at the end of every stage of the ACME project, an evaluation can be done to assess quality. A quality assessment is to guide whether the project meets the outline of the ideal in the project quality plans.
Cost: the success of a project is determined when the agreed project budget acts as a basis for the project and is compared with what has been spent on the project. To check the actual spending in real-time, the project dashboard is used.
d) Stakeholder satisfaction:
Stakeholders affect a project positively or negatively. If the stakeholders do not support the project, then the project is said to have failed. A successful project is that which has massive support from the stakeholders.
3. Stakeholders
There are different parties to a project that influence its direction and are also affected by the project’s outcomes. Stakeholders can be categorized as either internal or external stakeholders based on their relationship with the project being executed (Mabelo, 2020). The ACME enterprise accounting system upgrade has several internal and external stakeholders with different roles and different project benefits.
Customer (ACME): ACME is the customer in this project who needs to upgrade their enterprise accounting system from the current legacy version to the most current version x. ACME expects to enhance its internal operations with the new system. In addition, the system will eliminate accounting errors and delays to make the entity highly competitive. The customer has a positive attitude towards the project and is willing to offer any support for success. The success criteria for this customer is delivery of a Version X of the system within the set timelines and budget.
Target Market Segments: ACME has offices in Vancouver, Calgary, Toronto, New York and Los Angeles, which make up the market segments. These offices have different staff sizes and are running on older versions of the enterprise accounting system. Completing this project will ensure that all the offices have an updated and more efficient system that can enhance their operations.
Significant User Classes: Each office has different departments, which make up the user classes. The Human resource department, accounting services and internal and external consulting division form the first user class and require a system that will manage payroll and facilitate accounting activities. The IT department and application support are interested in a system that is easy to manage and use among staff members.
Site Manager: Each of the offices has a site manager who oversees all operations in the office. They are interested in a system that will make them competitive and easy to manage processes in their offices. They are excited about this project because of the benefits it promises on how they operate.
4. Vision
The vision describes what the project hopes to achieve after the information system has been delivered to the organization. An organizational vision describes the place that an organization wants to be in the future and the values and commitments to achieve this (Goksoy, 2015).
The project vision is to deliver a state-of-the-art enterprise accounting information system to enhance all accounting-related activities at ACME. The Version X system will replace the current legacy system and ensure that processes and transactions are recorded more accurately, data is managed and analyzed better, and human errors in accounting are eliminated.
In addition, this project envisions enhancing the competitiveness of ACME in its industry by enhancing internal operations and market lead time. By enhancing efficiency in all accounting-related operations, the firm’s production will be more efficient, which means that the market lead time will significantly improve.
5. Project Scope
Project scope is a description of the products and services that will be delivered. In addition, a scope outlines the goals, deliverables, features and functions of the final product (Project Management Institute, 2019).
Scope for Initial Product Release
Recording transactions: The new version x of the enterprise accounting system will record all transactions (payments and receipts) made in the company.
Report generation: The system will generate reports to users about different aspects of the organization’s performance.
Customer and vendor contact management: The system will have a database to manage customers and vendor contacts and ensure that the data can easily be retrieved.
Purchase order creation: It will automatically create and send a purchase order to vendors
Stock level tracking: The system will have a feature to manage inventory in the firm and notify users when the stock level is low.
Planned Growth Strategies for Subsequent Releases
Customized features for individual offices’ needs: In release two and release 3, there will be customization of features to include payroll, tax modules, and audits for the offices that require these features.
Customer Billing: Release 2 will include a feature to bill customers based on their purchases and after delivery of orders.
Account Balance monitoring: Release 3 will include a feature to report account balances to the office managers,
6. Assumptions and Dependencies
Assumptions are events or factors that are anticipated to be present or occur during a project’s lifecycle without a solid proof (Jonasson, 2007). On the other hand, dependencies are the internal or external factors that the project relies upon for success.
Assumptions
Accuracy of key schedule dates: It is assumed that the different project milestones and scheduled delivery dates have been made accurately to avoid issues during project implementation. For example, it is assumed that the scheduled date for release 1 in the Los Angeles office has considered the amount of work to be done since this office uses an older version of the accounting software.
Key Project team members’ availability: It is assumed that all subject matter experts, system developers, and trainers will be available when scheduled in the project.
Key Project team members’ experience: It is assumed that all project team members have the right experience to implement such a project at this level.
Dependencies
Strong and High Broadband Internet Connection: The new enterprise accounting information system will require a strong broadband internet connection to function correctly. The IT department will ensure that this is available to avoid system failure or hanging when used by the organization’s staff.
Support from Office Managers and Technical Staff: During launching and training, the office managers will play an essential role in ensuring that the project is successful. The success of these activities will depend on their cooperation and commitment to the project.
Reliable Information System Vendors: The project is also dependent on finding a reliable and reasonably priced vendor that will fall within the allocated budget of $3,000,000.
Constraints:
Any project has restrictions and hazards that must be addressed for the project to be successful in the end. Time, scope, and money are the three critical restrictions that project managers should be aware of. These are sometimes known as the project management triangle or the triple restrictions. Each limitation is linked to the other two; for example, expanding the project’s scope would almost certainly need more time and money, while shortening the project’s timeframe may save money but reduce scope. (Mishra & Mohan, 2019).
The triple constraints of project management
Time restriction:
The time constraint refers to the project’s completion timetable, which includes deadlines for each project phase and the date for the final deliverable’s deployment.
2) Scope restraints:
A project’s scope determines its precise goals, deliverables, features, and functionalities, as well as the tasks needed to execute it.
3) Cost restraints:
The project’s cost, often known as the budget, includes all of the monetary backing required to finish the project on time and within its set scope. Bear in mind that pricing does not refer to the price of goods; it also includes labour prices, quality control, vendors and other aspects. (Ismailov, 2016)
Time Constraint
Planning:
Planning entails establishing the project team’s primary goal(s), how the team wants to reach the goal(s), as well as the equipment and steps that’ll be done to reach the goals.
Scheduling:
The project management team must plan out a realistic schedule for each project phase.
Monitoring:
○ This step occurs once the project is underway and requires the team to analyze how the past stages of the project performed, noting trends and impacts on plans, and communicating these findings to all relevant stakeholders. (Ismailov, 2016)
Control:
○ After discussing the results of each phase of the project, the team must proceed accordingly in the control step. If things are going well, the team must investigate the elements that contributed to the favourable outcome so that it can be repeated. If a derailment occurs, the team must determine how and why it occurred to correct future actions. (Ismailov, 2016)
Cost constraint
Materials, permits, labour, and the financial impact of team members working on the project are all part of a project’s budget, including fixed and variable expenses. The following are a few methods for estimating a project’s cost:
Using historical data to see how much similar projects have cost in the past.
Estimating the cost of commodities and labour, among other things.
Parametric: Using current, relevant variables to compare past data.
Averaging the total charge of many credible vendor bids is referred to as a vendor bid.`(Trojanowaska, 20217)
Milestones
15/8/21 – Approval of Project Charter by the Project Sponsor.
30/8/21 – Completion of Project Plan.
5/9/21- project plan approved
5/9/21- project team assembled
10/9/21- project execution initiated
15/9/21- project execution completed
25/9/21 customer accepted
15/10/21 – Project Completed
9. Business Risks
Risks are any form of threat to a project, which upon occurrence, have an impact on the project outcome. Risk management is crucial and entails risk identification, evaluation, and some prevention or mitigation strategies (Kendrick, 2015). The project of delivering version X enterprise accounting system from ACME is facing several risks, as summarized in the following table:
Risk
Probability
Impact
Risk Response
Delayed delivery by the vendor
Low
Moderate
Risk Transfer: Ensure that there is a clause in the contract with vendor for penalty in case of delayed delivery of the information system
Missing Features in the delivered information system
Moderate
High
Risk Transfer: The Vendor will handle all challenges and costs of missing features.
Need for more Time for Employee Training
High
Low
Risk Mitigation: when making the project schedule, an allowance for more training days will be made.
Opposition by Office Managers in accepting the new information system
High
High
Risk Mitigation: Holding boardroom meetings with the office managers as the key project stakeholders to explain product features and benefits.
Cost overrun due to unforeseen expenses
Moderate
High
Risk Acceptance: Set aside a budget allowance for miscellaneous expenses.
The new system will slow down operations before all staff members fully understand how to use it.
High
High
Risk Mitigation: Increase the trainers to ensure that training is done faster. Getting support from the vendor regarding the information system.
System Failures
Low
Moderate
Risk Transfer: The vendor will bear any costs for system failures as agreed in the contract.
10. Resources
Project resources include people, materials, and capital needed for the project to become successful (Project Management Institute, 2019). ACME has committed several critical resources to the project, which will ensure that all project activities run smoothly and the implementation of the new accounting information system is a success.
Resource
Description and source
Human Resources
Site Managers
The site managers in each of the offices are crucial human resources that will facilitate the project success. They have a lot of information regarding the current legacy accounting system, its features and failures. The site managers will point out the features that must be present in the new version of the accounting system. In addition, they will provide details about their staff training needs to know the number of trainers required.
Subject Matter Experts
The Vancouver, Toronto and New York offices have technical staff who have worked in other upgrades and are subject matter experts. They are key resources in providing technical details of the new information system. They will test the product features and ensure that they are functioning properly. In addition, they will assist in the staff training process.
Accounting Services Consulting Division Staff
The staff at this division have a lot of information about transactions and processes that the firm is involved in, and will provide insight on the specific features that should be in the information system.
Other Resources
Funding
The project has a specified budget that requires to be funded. ACME will provide funding for this project to be a success.
Computers
Computers will be required for users to access and use the system. The organization has computer assets allocated to staff members, which will be used for this project.
Training
Training venues will be provided by each office. Boardrooms and other appropriate spaces will be used.
Budget and Seeking Approvals
ACME is a US-based accounting firm operating majorly in Los Angeles, Toronto, Calgary, New York, & Vancouver. The branches of the ACME are operating older versions of the accounting application, which is comparatively less efficient and slower than the latest version. Therefore, ACME decided to upgrade the accounting application without compromising with the work. Except for Los Angeles (which operates version 2 of the accounting application), all the other firms use version 3. To follow an appropriate approach that will help the organization to adapt to changes without affecting the day-to-day work. First, we need to focus on the approval before executing the changes.
Budget Management: Budget management refers to the process of allocation and supervising finances. Under budget management, the overall budget is included, but the study of every cost element and the logistics is also a crucial part of budget tracking.
Budget Item Description
Amount
Capital Cost (one time)
$3,000,000
Hardware Infrastructure Support Cost (one time)
$700,000
Project Team Cost (External)
$1,500,000
Training and Change Management Cost
$300,000
Maintenance Cost
$400,000
Annual Hardware Maintenance
$150,000
Optional Management Module Cost
$450,000
Annual Maintenance Optional Management Module Cost
$85,000
The overall Budget = $6,585,000
The current operating Cost = $9,35,000
The estimated operating budget in the next two year will be as follow:
Operating cost = Training and Change Management Cost + Annual Maintenance Cost + Annual Hardware Maintenance + Annual Maintenance Optional Management Module Cost
Operating cost = 300000 + 400000 + 150000 + 85000 = $9,35,000 per year
With the advancement in technology, the cost of maintenance of accounting software is also increasing by 5%. Let us assume that if the present operating cost is $9,35,000, then the operating cost of next year will be $9,35,000 + 5%, the increase in cost is calculated as follow:
5/100 × $9,35,000 = $46750
So, operating cost of next year = $9,35,000 + $46750 = $ 9,81,750
The estimated operating cost two years = $9,35,000 + $ 9,81,750
= $1,916,750
● Approval For a Rational Budget: After selecting the approach, the firm must focus on its Financial aspects. Setting up a budget to ensure that the capital is not wasted and the work is done within the specified amount is necessary.
Current Budget:- $6,585,000
Operating Budget:- $9,35,000
The cost is related to installing the new version related to the Latest software, Latest hardware, Execution and training, and upgrading of products.
The above figure presents the budget of the ACME. To upgrade the older version of accounting software into a new or latest version, it is necessary to comply with all the demands and decisions made by the top management team. Before starting their work, it is necessary to get the approval of the project manager, stakeholders & investors, manager, and financial advisor. The profile by the top management authority will help in taking all the necessary decisions that will comply with the demands made by the top management team. The expenditure list and all the necessary items to be purchased must be mentioned in the document to give a brief description of the steps to install the latest version of the accounting software. While getting approval, the approach using which we can avoid negative consequences must be mentioned to get their suggestions. They should be made aware of all the necessary details related to the changes that will take place within the organization. Without approval, the steps and changes cannot be executed; it is necessary to always take approval in the form of a written document Before commencing any work.
Pursue with Parallel Running approach:- To ensure that the workers are not facing complications in performing their responsibility and completing the work, it is necessary to follow an up and running approach to ensure that the employees are successfully performing their responsibility while the other systems are upgrading. Parallel running approach to the approach in which both the critical areas are covered where the workers are also performing their part whereas upgrading the old accounting versions into new accounting versions is also going hand in hand. It is one of the safest approaches as compared to the other approaches.
To ensure that the consultants decide according to the preferences and demands of the ACME, the consultant must ask for the approval of the crucial members of the top management team.