Introduction Spinners and Spinners group is a group of related companies that operate mainly in the textile industry. The group comprises of the parent company and two subsidiaries. Each company is independent and uses a different accounting system to collect process and store its information. Over recent times, this has proved problematic with intercompany transactions reflecting differently. This has caught the management’s attention as a highly risky area that requires urgent attention. Our project will focus on identifying key areas of weakness in the group’s information systems and proposing a viable solution. Problem and Solution Statement The biggest problem we have is the duplicity created by multiple accounting systems within the group. This is a great cost to the group in terms of labor costs with period end reconciliations and consolidation procedures taking about a third of the accounting department labor hours which translates to $300,000 in staff costs. Audit fee is based on hours spent on the job by the public accountant (Collins, 2011). For spinners on average an annual statutory audit takes almost 800 hours of the audit team which is charged at $300 an hour amounting to $240,000 annually in audit fee. This is a huge cost for the group that requires urgent attention. This is in addition to the risk of non-compliance due to system limitations In undertaking this project, we aim to come up with recommendations on a uniform information system for the group that meets the needs of each subsidiary, the parent and the group as a whole. The focus will be on reducing operational costs for the group by eliminating all unnecessary costs due to inefficiency in the information system. The aim is to cut costs by at least 20% of total operating costs and hence increase the net profit. Mission Justification on This project is the key to the group’s future success. A good information system is a source of competitive advantage as it enables faster and more accurate decision making (Collins, 2011). If this project is ignored the company will continue losing about $500,000 annually cost reduction. Lack of proper records as per legal requirements may lead to legal battles which will cost the group both financially and in reputation. In some instances this may lead to withdrawal of operating licenses and closure of some of the company (Lock, 2013). This project will help cut costs, avoid the risk of non-compliance while at the same time improving the group’s competitiveness in the market. All these will mean greater bottom line profits for the companies. Scope The scope of our project will be to investigate the information system requirements of the group and identify a viable solution that meets all these demands. This will include doing a stakeholder mapping to identify key users and their requirements. It would also entail an assessment of the legal requirements on information systems. An assessment of the feasibility of the identified solution is within the scope of this project but the implementation of the solution is beyond the scope of the project (Cook, 2004). Our scope is limited to investigating and proposing a potential solution. Work Breakdown Structure WBS Scope Deliverables Investigate I.S requirement To create weakness report on current information system List of potential solution Share holder mapping Stakeholder mapping report A user impact-responsibility map Assessment of legal requirements in I.S Best practice report across the industry Assessment of feasibility study Feasibility analysis of the recommended choice. Investigation and proposing a potential solution Recommendation of best choice   Estimated Cost and Duration Task Duration Cost investigating IS requirements 70 21000 stakeholders mapping 60 18000 assessments of legal requirement in IS 50 15000 assessment of Feasibility study 50 15000 investigation and proposing a potential solution 50 15000 Direct and indirect labor. 52 15600 machinery 150 45000 equipment 156 46800 supplies 162 48600 Total Cost $ 240,000.00 Major Deliverables In accomplishing our mission, we aim to recommend an information management system that is both users friendly as well as effective. This will follow a step process and at each step certain deliverables are expected as a measure of progress. These are; • A weakness report on current information system • Stakeholder mapping report • A user impact-responsibility map • Best practice report across the industry • List of potential solution • Recommendation of best choice • Feasibility analysis of the recommended choice. The key deliverables will act as a guide to the steps we need to take at each stage as well as an indicator of when it is time to take the next step. Milestones Our project will be assessed on several milestones based on tasks accomplished at each stage and the successful completion of a major deliverable. The first milestone will be the completion of the investigation stage. This will be confirmed by the completion of a weakness report and getting the management’s assent on the same after a month’s time (CIBB, 2010). The second milestone will be needs and responsibilities mapping of the group which will help us form an idealistic solution with which all propositions will be measured against. This will be indicated by two deliverables, stakeholder mapping report and a user impact-responsibility map (Cook, 2004). This shall be about a fortnight from the previous milestone. Our third and final milestone will be solution recommendation which will be the final step in the project. This will be indicated by the final deliverable of a best fit solution recommendation. Technical Requirements For the successful completion of this project, we will require some technical expertise on several fields. First requirement will be a qualified information system person who can identify weaknesses inherent in the current system due to the technology employed which we suspect is a key part of the problem. This skill will also be required in the solutions evaluation stage. We would also require a legal expert in an advisory capacity to ensure the solution recommended meets the legal threshold on information requirements. A human resource expert may also be required in identifying people related problems in the current information system as well as ensure the recommended solution will be easy integrate with the companies’ staff. Assumptions and Constraints In undertaking this project several underlying assumptions are made including: • The employees of the company will cooperate with us in undertaking the project • There exists a suitable solution to the information management problems • The weaknesses in the current system can be broken down into human related weaknesses and technology related weaknesses • Management support for the project is absolute. We also foresee some constraints in undertaking the project which may include: • Limited technical expertise • Budgetary constraints as the project will rely on a fixed budget allocation • Information access constraints especially in coming up with industry best practice Conclusion The project is an ambitious and difficult one but very necessary for the group both as a competitive edge and a risk management tool. Therefore in my opinion all resources necessary should be given to the project team to ensure successful completion to the project as in the end the cost savings that will follow as a result of the success will outweigh the costs by far. References Chartered Institute of Building (Great Britain). (2010). Code of practice for project management for construction and development. Chichester, U.K: Wiley-Blackwell Lock, D. (2013). Project management. Collins, R. J. (2011). Project management. New York: Nova Science Publishers. Cook, V. (2004). The English writing system. London: Arnold.

 
 

Introduction

Spinners and Spinners group is a group of related companies that operate mainly in the textile industry. The group comprises of the parent company and two subsidiaries. Each company is independent and uses a different accounting system to collect process and store its information. Over recent times, this has proved problematic with intercompany transactions reflecting differently. This has caught the management’s attention as a highly risky area that requires urgent attention. Our project will focus on identifying key areas of weakness in the group’s information systems and proposing a viable solution.

Problem and Solution Statement

The biggest problem we have is the duplicity created by multiple accounting systems within the group. This is a great cost to the group in terms of labor costs with period end reconciliations and consolidation procedures taking about a third of the accounting department labor hours which translates to $300,000 in staff costs. Audit fee is based on hours spent on the job by the public accountant (Collins, 2011). For spinners on average an annual statutory audit takes almost 800 hours of the audit team which is charged at $300 an hour amounting to $240,000 annually in audit fee. This is a huge cost for the group that requires urgent attention. This is in addition to the risk of non-compliance due to system limitations

In undertaking this project, we aim to come up with recommendations on a uniform information system for the group that meets the needs of each subsidiary, the parent and the group as a whole. The focus will be on reducing operational costs for the group by eliminating all unnecessary costs due to inefficiency in the information system. The aim is to cut costs by at least 20% of total operating costs and hence increase the net profit.

Mission Justification on

This project is the key to the group’s future success. A good information system is a source of competitive advantage as it enables faster and more accurate decision making (Collins, 2011). If this project is ignored the company will continue losing about $500,000 annually cost reduction. Lack of proper records as per legal requirements may lead to legal battles which will cost the group both financially and in reputation. In some instances this may lead to withdrawal of operating licenses and closure of some of the company (Lock, 2013). This project will help cut costs, avoid the risk of non-compliance while at the same time improving the group’s competitiveness in the market. All these will mean greater bottom line profits for the companies.

Scope

The scope of our project will be to investigate the information system requirements of the group and identify a viable solution that meets all these demands. This will include doing a stakeholder mapping to identify key users and their requirements. It would also entail an assessment of the legal requirements on information systems. An assessment of the feasibility of the identified solution is within the scope of this project but the implementation of the solution is beyond the scope of the project (Cook, 2004). Our scope is limited to investigating and proposing a potential solution.

Work Breakdown Structure WBS

Scope Deliverables
Investigate I.S requirement To create weakness report on current information system

List of potential solution

Share holder mapping Stakeholder mapping report

A user impact-responsibility map

Assessment of legal requirements in I.S Best practice report across the industry
Assessment of feasibility study Feasibility analysis of the recommended choice.
Investigation and proposing a potential solution Recommendation of best choice

 

 

 

 

Estimated Cost and Duration
Task Duration Cost
investigating IS requirements 70 21000
stakeholders mapping 60 18000
assessments of legal requirement in IS 50 15000
assessment of Feasibility study 50 15000
investigation and proposing a potential solution 50 15000
Direct and indirect labor. 52 15600
machinery 150 45000
equipment 156 46800
supplies 162 48600
Total Cost  $  240,000.00

Major Deliverables

In accomplishing our mission, we aim to recommend an information management system that is both users friendly as well as effective. This will follow a step process and at each step certain deliverables are expected as a measure of progress. These are;

  • A weakness report on current information system
  • Stakeholder mapping report
  • A user impact-responsibility map
  • Best practice report across the industry
  • List of potential solution
  • Recommendation of best choice
  • Feasibility analysis of the recommended choice.

The key deliverables will act as a guide to the steps we need to take at each stage as well as an indicator of when it is time to take the next step.

Milestones

Our project will be assessed on several milestones based on tasks accomplished at each stage and the successful completion of a major deliverable. The first milestone will be the completion of the investigation stage. This will be confirmed by the completion of a weakness report and getting the management’s assent on the same after a month’s time (CIBB, 2010).

The second milestone will be needs and responsibilities mapping of the group which will help us form an idealistic solution with which all propositions will be measured against. This will be indicated by two deliverables, stakeholder mapping report and a user impact-responsibility map (Cook, 2004). This shall be about a fortnight from the previous milestone.

Our third and final milestone will be solution recommendation which will be the final step in the project. This will be indicated by the final deliverable of a best fit solution recommendation.

Technical Requirements

For the successful completion of this project, we will require some technical expertise on several fields. First requirement will be a qualified information system person who can identify weaknesses inherent in the current system due to the technology employed which we suspect is a key part of the problem. This skill will also be required in the solutions evaluation stage. We would also require a legal expert in an advisory capacity to ensure the solution recommended meets the legal threshold on information requirements. A human resource expert may also be required in identifying people related problems in the current information system as well as ensure the recommended solution will be easy integrate with the companies’ staff.

Assumptions and Constraints

In undertaking this project several underlying assumptions are made including:

  • The employees of the company will cooperate with us in undertaking the project
  • There exists a suitable solution to the information management problems
  • The weaknesses in the current system can be broken down into human related weaknesses and technology related weaknesses
  • Management support for the project is absolute.

We also foresee some constraints in undertaking the project which may include:

  • Limited technical expertise
  • Budgetary constraints as the project will rely on a fixed budget allocation
  • Information access constraints especially in coming up with industry best practice

Conclusion

The project is an ambitious and difficult one but very necessary for the group both as a competitive edge and a risk management tool. Therefore in my opinion all resources necessary should be given to the project team to ensure successful completion to the project as in the end the cost savings that will follow as a result of the success will outweigh the costs by far.

 

 

 

References

Chartered Institute of Building (Great Britain). (2010). Code of practice for project management for construction and development. Chichester, U.K: Wiley-Blackwell

Lock, D. (2013). Project management.

Collins, R. J. (2011). Project management. New York: Nova Science Publishers.

Cook, V. (2004). The English writing system. London: Arnold.

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