Professional Development (300578)
Lecture 7 – Project Proposals
Project Proposals
Session 1 2021
Professional Development (300578)
Lecture 7 – Project Proposals
Reference Material for this lecture
o Project Management for Information Systems, Fifth Edition 2008, James Cadle and Donald Yeates
o Chapters1,2,3,6,7,8,9and10
o Please ensure you read the above chapters if you
have yet to do so
2
Professional Development (300578)
Lecture 7 – Project Proposals
Outline
o Different Types of IS Projects
o Estimation
o Business Case
o Evaluate Current Situation\Products
o Cost Benefit Analysis
o General Business Case Information
Professional Development (300578)
Lecture 7 – Project Proposals
Different Types of IS Projects
o Software Development
o Package Development
o System Enhancement
o Consultancy and Business Analysis o Systems Migration
o Infrastructure Implementation o Outsourcing
o Smaller IS Projects
Professional Development (300578)
Lecture 7 – Project Proposals
Software Development
o Similar to other ʻconstructionʼ projects
o Main difficulty – intangibility of product
o Project managers need:
o Flexibility and adaptability
o Well-developed interpersonal and stakeholder
management skills
Professional Development (300578)
Lecture 7 – Project Proposals
Package Development
o Quicker and cheaper than building a system (Off the shelf product)
o Main difficulties
o Limitation to tailoring to align to exact user
requirements and processes
o Main challenges for the project manager
o Keeping users realistic about what they will get o Trade offs between business needs and package
capabilities
Professional Development (300578)
Lecture 7 – Project Proposals
System Enhancement
o Often handled as ʻbusiness as usualʼ but can involve a lot of work.
o Main issues for the project manager:
o Keeping existing systems operational while
enhancements are made
o Sharing technical staff time between
enhancements and day-to-day support o Regression testing of enhancements.
Professional Development (300578)
Lecture 7 – Project Proposals
Consultancy and Business Analysis
o Workshop and Analysis process in defining users requirements
o Main Challenges
o Intangibility of what the user is asking for
and aligning to a solution or product that
may not be identified o Difficult to estimate
Professional Development (300578)
Lecture 7 – Project Proposals
Systems Migration
o Moving or upgrading existing system to new platform/version.
o Users judge success by lack of interruptions.
o May involve some retraining of users.
o May also involve some software development for interfaces
Professional Development (300578)
Lecture 7 – Project Proposals
Infrastructure Implementation
o Installation of hardware and/or Communications networks
o Fitting out of computer suites or server sites
o General project management principles apply
o Specific issues to consider:
o Need to maintain ʻbusiness as usualʼ o Supplier management vital.
Professional Development (300578)
Lecture 7 – Project Proposals
Outsourcing
o Systems outsourced to:
o Gain access to specialist expertise o Simplify management
o Reduce costs and/or headcount
o Concentrate on ʻcoreʼ business.
o Involves:
o ‘Due diligenceʼ in handing over systems
o Training new people to support systems
o Taking inventories of assets transferred/retained o Migrating contracts of employment
o Renegotiating supplier contracts.
o Sameissuesapplywhenbringingsystemsbackin-house.
Professional Development (300578)
Lecture 7 – Project Proposals
Smaller IS Projects
o General project management principles apply
o But common sense needed too
o Challenge is to get adequate control without too
much bureaucracy
o One document still vital – Project Initiation
Document (also referred to as Project Charter)
o Simple project plan also useful
o Monitoring and control should be tailored to the
scale of project
Professional Development (300578)
Lecture 7 – Project Proposals
Summary Software vs Hardware Projects o Both similar to otherʻconstructionʼprojects
o Hardware projects
o Project managers can structure hardware projects like a
traditional construction project build due to the tangible nature of deliverables
o Software projects
o Project managers require more flexibility and adaptability
with well developed interpersonal and stakeholder management skills due to the intangible nature of deliverables
Professional Development (300578)
Lecture 7 – Project Proposals
Estimation Techniques
o Traditional estimation techniques utilised for Hardware projects due to their more tangible delivery nature
o More sophisticated estimation techniques devised for Software projects due to
o Software is intangible, users do not see final solution at time of purchase
o Scope tends to expand, as users tend to realize the true potential only after the project starts
o Hard to estimate creeping scope
o Hard to quantify benefits of software
o Not enough planning for risks and contingencies as they are often
invisible
o A single rule or technique of estimation cannot be applied across
different types of software projects
Professional Development (300578)
Lecture 7 – Project Proposals
Estimation Techniques
o Other standard issues (hardware and software) affecting estimates include:
o Staff inexperience
o Use of contract staff
o User involvement and availability
o Degree of user support during acceptance o Installation and commissioning
o Warranty
Professional Development (300578)
Lecture 7 – Project Proposals
Estimation (Delphi Technique)
o Several estimators are given specification of work and asked for estimates.
o Summarized anonymously and results circulated back to estimators.
o Can revise estimates in the light of othersʼ ideas.
o Method reduces personal disagreements and ego- based issues.
Professional Development (300578)
Lecture 7 – Project Proposals
Estimation (Constructive Cost Model (CoCoMo))
o Formulae based on thousands of delivered source instructions (KDSI)
o Basic, intermediate and detailed versions
o CoCoMo II now developed for wider range of development
approaches
o Useful elapsed time formula:
o 2.5 × (estimated effort in man-months)0.33
Professional Development (300578)
Lecture 7 – Project Proposals
Estimation Techniques – Practical Advice
o Use standard project structures if possible
o Use subject matter experts where possible to qualify o Document estimates
o Revisit estimates in light of risk analysis
Professional Development (300578)
Lecture 7 – Project Proposals
Business Proposal Preparation o Defined Purpose
o Understandingwhatyouwanttoachieve
o Understandingtheproduct/servicethatcandeliverwhatyou
want to achieve
o Estimation(ResourcesandCosts)
o Understanding the benefits of the planned system
Professional Development (300578)
Lecture 7 – Project Proposals
Content of a Business Proposal o Introduction and background
o Business case for doing the project
o Description of problem or opportunity
o Options/solutions available and considered o Cost Benefit Analysis
o Impacts and Risks
o Conclusions and Recommendations
Professional Development (300578)
Lecture 7 – Project Proposals
Evaluate Current Situation/Products o Strengths, Weaknesses Opportunities Threats (SWOT)
Internal [We Control]
External
[Cannot Control but Impact]
Strengths [Capitalise]
Opportunities [Invest]
Weaknesses [Shore Up]
Threats [Identify]
Drives list of ideas (prioritised) to define Goal Statement and Objectives
Professional Development (300578)
Lecture 7 – Project Proposals
Evaluate Current Situation/Products o Boston Consulting Group (BCG) Matrix
Wild Cat
– High potential for growth
– Good business for the future – New product or service
Star
– Profitable now and in the
foreseeable future
Dog
– Bad products or services
– Lost market share or in declining
market
Cash Cow
– Current high income earners
– Used to fund the future cash
cows
Market Growth
Market Share
Professional Development (300578)
Lecture 7 – Project Proposals
Cost Benefit Analysis o Payback Calculation
o Simple and Straightforward
o Discounted Cash Flow
o Takes into account ‘time value of money’
o Produces a net present value (NPV) for the project o What else could have been done with the money
Professional Development (300578)
Lecture 7 – Project Proposals
Cost Benefit Analysis o Payback Calculation
LOOKS GOOD RIGHT?
Professional Development (300578)
Lecture 7 – Project Proposals
Cost Benefit Analysis
o Discounted Cash Flow
Year
Outflows (Investment)
Inflows (Returns)
Net Cash Flow
Discount Factor 20%
Discount Cash Flow
0
530,000
-530,000
1
-530,000
1
150,000
1/(1+0.2)1 = 0.833
124,950
2
150,000
1/(1+0.2)2 = 0.694
104,100
3
150,000
1/(1+0.2)3 = 0.579
86,850
4
150,000
1/(1+0.2)4 = 0.482
72,300
Net Present Value
-141,000
Professional Development (300578)
Lecture 7 – Project Proposals
Cost Benefit Analysis
o Discounted Cash Flow
Year
Outflows (Investment)
Inflows (Returns)
Net Cash Flow
Discount Factor 20%
Discount Cash Flow
0
530,000
-530,000
1
-530,000
1
150,000
1/(1+0.2)1 = 0.833
124,950
2
150,000
1/(1+0.2)2 = 0.694
104,100
3
150,000
1/(1+0.2)3 = 0.579
86,850
4
150,000
1/(1+0.2)4 = 0.482
72,300
Net Present Value
-141,000
After 5 years, it is still at a loss
Professional Development (300578)
Lecture 7 – Project Proposals
Overall Project Budget
Professional Development (300578)
Lecture 7 – Project Proposals
Scheduling – Effort and Elapsed Time o Effort = total volume of work.
o Elapsed time depends on effort and also:
o How many resources are available.
o What proportion of their time is available to the project. o Delays outside the team’s control (eg lead times for
hardware).
o Dependencies on others.
Professional Development (300578)
Lecture 7 – Project Proposals
Trade Offs – The Triple Constraint
Professional Development (300578)
Lecture 7 – Project Proposals
Risk Management – Overview
Professional Development (300578)
Lecture 7 – Project Proposals
Risk Management – Risk Map (Matrix)
Also known as Consequence
Professional Development (300578)
Lecture 7 – Project Proposals
Risk Management – Risk Register (Risk Log)
Reference
Category
Date Raised
Likelihood
Consequence
Short Description
Treatment Summary
Owner
Resolve By Date
Status
Date Closed
Some variations of the above are also used
How do you think you can address risk? Accept it, Avoid it, Mitigate or Transfer?
Professional Development (300578)
Lecture 7 – Project Proposals
Presenting the Project Proposal o Aim
o Be clear with what is this designed to achieve?
o Audience
o Who will be reading the business case and who is making
the decision? (Professional writing not academic writing!) o Arrangement
o Ensure the business case is logical, leading to the recommendation
o Appearance
o Ensure the business case is accessible, attractive, easy to
follow
Professional Development (300578)
Lecture 7 – Project Proposals
In the end….are the benefits realised?
Professional Development (300578)
Lecture 7 – Project Proposals
Summary
o Understand the nature of the project
o User formal methods sprinkled with experience to estimate effort and time
o Prepare a Business Case clearly identifying quantitative and qualitative benefits
o Develop a risk management strategy
Professional Development (300578)
Lecture 7 – Project Proposals
Group Assignment and Tutorials Actions
o Take into account what was covered to assist with Group Assignment:
o Type of IS project
o SWOT Analysis of product/service/solution to validate
recommendation
o Strategic analysis to determine where in its life the solution is
to validate recommendation
o Cost Benefit Analysis to confirm financial viability of solution o Estimation to attain accurate estimates and feed into cost
benefit analysis
o Risk Management strategy
o Work on Module 2 Tutorial Questions
Professional Development (300578)
Lecture 7 – Project Proposals
Actions continued:
• Group assignment Part A
• To be submitted by nominated group delegate
• Delegate needs to be known to the UC, and they need to check they can see the submission link
• Progress peer review
• All group member submit this individually
Professional Development (300578)
Lecture 7 – Project Proposals
?