Proposal Analysis

Regarding to the situation mentioned above, the following table illustrates the
comparison between four proposals on four areas: benefit, cost, users, and required
staffs.

Table 1
Customer
Knowledge Business Accounting
Relationship
Management Analysis System
System
Benefit - It allows managers - It will allow the - It allows the - The Interface
know skill company to company know between the
shortages and improve customer AURA system
competencies of management information. and the
employees in their through - It can build and existing
own departments improved maintain the accounting
and identify information relationship package is less
training quality. between than perfect.
requirements. - It can improve customers and - It allows owners
- It offers the report quality the company. of the business
opportunity to by replacing - The system can know the
employees to existing improve sales control system
publish knowledge reporting with forecasting. is suitable for
and experience in alternative - It can increase purpose.
order to help frameworks customer - The company
planning the and loyalty and can easily
personal approaches. satisfaction. obtain loans
development - It can improve and overdrafts
process. operational from Banks.
- The system is able to efficiency. - It provides the
record training and - It will reduce company
qualification of local analysis time manage money
staffs. and improve due from
- Practice group accrual customers.
workshops will information. accurately
establish a culture - It is flexible and
of continuous quickly to
improvement. create
accounting
reports
Cost 616,924 275,000 509,700 401,840
User All employees All departments Sales and Accounting,
marketing, and customer service
customer service and IT
Required Human Resource IT Senior Finance,
staf management, Customer
Sales and service, and IT
marketing, and
customer service
 team

After the comparison, it is essential to tackle the internal problem first because it
will be a major threat to the performance of the company. Thus, the Knowledge
Management system can reduce the company's problems. The system allows
managers realise skill shortages and competencies of their subordinates. If what
kind of competencies that they lack, managers and Human Resource team (HR) can
arrange some suitable training programmes or provide some experts to help them.
In addition, there is a recording data in this system for training and qualifications of
all staffs so managers can select the right man for the right job. This system also
provides workshop group to allow employees sharing their knowledge and
experience to other employees. It would be the best way to managers and
colleagues accessing this information and deploying skills effectively. In terms of
miscommunication within the company, the Human Resource team (HR) can provide
communication training to every employee level in order to reduce a
misunderstanding problem and the conflict between operative staffs. Because
employees are the most valuable asset, providing them knowledge is the benefit in
IDENTIFYING
the long term. They can lead to the success of the company.

Knowledge Management System

The figure below represents the Knowledge Management process among
employees.

SHARING
 Proposal improvement
Based on the information given, the table below demonstrates five parts that need
to be improved in the Knowledge Management proposal.

Price Quanti Cost

ty
1. PCs 500 9 PCs 4,500
2. Internal 20,000 20,000
bandwidth
3. Set-up Sever 19,000 19,000
4. Connect with 40,000 40,000
Aura
5. Annual Training 60,000 5 years 300,000
course
Total Cost 383,500

Firstly, the supplement of computers is necessary to all staffs because they need to
use computers finding more information involving their work and also accessing E-
learning and E-training. The company has currently three depots: West Grimston,
Arrowford, and Lincoln. Three computers should be added per depot. The cost of
equipment would be 4,500. Secondly, when adding more computers, the internal
network might be not able to support additional bandwidth, and the server must be
upgraded for capacity. The internal bandwidth and set-up server cost 20,000 and
19,000 respectively. Furthermore, the Knowledge Management system will not
automatically interface with Aura so it should be added 40,000 for connecting with
Aura. Lastly, in order to bring employees up to standard on their certifications, the
company needs to provide training budgets for 60,000 per annum. Therefore, the
total costs of the project improvement would be 383,500.

By implementing this proposal, if this proposal succeeds, non-productive time (e.g.

awaiting Orbis Specialist, awaiting tradesmen and rectification) should be decreased
because providing training course and personnel development system staffs could
work efficiently and very expert in their area. That means deducting the error
working process and the conflict across the company. When employees understand
their duties, it would lead to the positive working environment. Therefore, the
system could increase the productivity hour and decrease labour costs resulting in
an increase in the profitability of the company.

Experts
Work
Efficiency
Conflict
Productivity
Hour Profit
Error
The payback period would be shown below:

Payback period
Net benefit / (costs) Balance carried forward
Year 0 (575,424) (575,424)
Year 1 251,611 (323,813)
Year 2 251,667 (72,147)
Year 3 251,728 179,581
Year 4 251,795 431,376
Year 5 251,869 683,245

The company will recover from cash inflows generated by the investment in the
fourth year.

Therefore, this proposal can achieve three objectives of Orbis's CEO. These consist
of improving the profitability within three years, improving the customer services
and response times, and also building a better set of relation within the company.
Appendix
Knowledge Management
Category Project Calculati Year 0 Year Year Year Year Year
Requirem on details 1 2 3 4 5
ents for year 1
License 120,000 120, 0 0 0 0 0
cost for one 000
time
(based on
40 users)
Additional 2,500 2,500*1 287,
license per user 15 users 500
cost =
287,500
Annual 25,000 0 25,0 25,0 25,0 25,0 25,0
maintenan 00 00 00 00 00
ce cost
Implement 1,250 30 days 37,5 0 0 0 0 0
ation work per day consultan 00
consultanc cy cost =
y 37,500
(1,250*
30)
Recording 1
HRs HRs cost 22,2 0 0 0 0 0
of training Salary - for three 00
data (two 3,700 months =
HR stafs per month 22,200
for three (HR are (3,700*
months) required 3*2)
for three
months)
Training 400 hours Training 19,7 0 0 0 0 0
costs costs = 24
19,724
(400 *
49.31)
Miscellane Assume 5,00 0 0
ous cost miscellan 0
eous cost
2,000
only year
1
491, 25,0 25,0 25,0 25,0 25,0
924 00 00 00 00 00
Total cost of the company within 3 years would be
616,924
1
HRs Salary is calculated from total HRs salary is 581,200 per year. There are 13
HR staffs. Thus, the HRs salary pee month is equal to approximately 3,700
(581,200/(13*12)).
*Salary and wages are taken from Management Accounts report for January 2017.
Business Analytics
Category Project Calculatio Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Requireme n details
nts for year 1
License 33,000 33,00 33,0 33,0 33,0 33,0 33,0
cost per annum 0 00 00 00 00 00
(based on
30 users)
Training 350 per 45 days 15,75 0 0 0 0 0
run by day training 0
consultanc cost =
y 15,750
(350*45
)
Implement 1,250 per 45 days 56,25 0 0 0 0 0
ation work day consultan 0
consultanc cy cost =
y 56,250
(1,250*
45)
Miscellaneo Assume 5,000 0 0 0 0 0
us cost miscellaneo
us cost
2,000 only
year 1
110,0 33,0 33,0 33,0 33,0 33,0
00 00 00 00 00 00
Total cost of the company within 3 years would be
275,000
Customer Relationship System
Category Project Calculatio Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Requireme n details
nts for year 1
Initial cost 3 days for 1
senior 700 0 0 0 0 0
one senior managem
manageme ent salary
nt per 3 days
= 700
(235.27*3)
License cost 80,000 Number of 185,0 0 0 0 0 0
(based on users = 45 00
15 users) users

15 user
licenses +
extra 30
user
licenses
(@3500
per extra
user) =
185,000
Annual 25,000 0 25,0 25,0 25,0 25,0 25,0
software per annum 00 00 00 00 00
support cost
Implementat 79,000 for 79,00 0 0 0 0 0
ion work one time 0
consultancy cost
Annual 14,000 0 14,0 14,0 14,0 14,0 14,0
Software per annum 00 00 00 00 00
Maintenance
Culture 750 per Number of 7,500 7,50 7,50 7,50 7,50 7,50
Change day workshop 0 0 0 0 0
Workshops = 10 days.
Culture
Change
Workshops
cost for 10
days =
7,500 per
year
Miscellaneo Assume 5,000 0 0 0 0 0
us cost miscellane
ous cost
2,000
only year 1
277,2 46,5 46,5 46,5 46,5 46,5
00 00 00 00 00
 00
Total cost of the company within 3 years would be 509,700
1
Senior managements salary is calculated from total senior managements salary
is 388,800 per year. There are 6 management staffs. Thus, the senior
managements salary per day is equal to approximately 235.27 (338,800/
(12*20*6)). 20 days for working day.
*Salary and wages are taken from Management Accounts report for January 2017.
Accounting System
Category Project Calculation Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Requirements details for
year 1
License 80,000 Number of 110,0 0 0 0 0 0
Cost (based on 20 users = 40 00
users) users

20 user
license +
extra 20 user
licenses
(@1,500 per
extra user) =
110,000
Annual 22,000 per 0 22,0 32,0 22,0 32,0 22,0
support annum 00 00 00 00 00
cost Provision every
second year
10,000
Implement 1,500 per day Implementati 45,00 0 0 0 0 0
ation work (required 30 on cost = 0
consultanc days) 45,000
y (1,500*30)
Training 250 pay day Training cost 7,500 0 0 0 0 0
run by (required 30 = 7,500
consultanc days) (250*30)
y
Cost of one The salary of IT For 6 months 17,10 0 0 0 0 0
staf from = 2850 per Cost of IT 0
IT for 6 months staff =
months (required 6 17,100
months) (2850*6)
Cost of one The salary of For 6 months 10,68 0 0 0 0 0
staf from Service Centre Cost of 0
Service = 1780 per Service
Centre for months Centre staff
6 months (required 6 = 10,680
months) (1780*6)
Cost of one The salary of For 12 76,56 0 0 0 0 0
staf from Service Centre months 0
Finance for = 3190 per Cost of 2
12 months months Finance staffs
(required 12 = 76,560
months) (3,190*12*2
)
Miscellaneo Assume 5,000 0 0 0 0 0
us cost miscellaneous
cost 2,000
 only year 1
271,8 22,0 32,0 22,0 32,0 22,0
40 00 00 00 00 00
Total cost of the company within 3 years would be 401,840
Orbisprotect
Limited

Payback calculation

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5

Balance brought (575,424 ( ( 431

forward ) 323,813) 72,147) 179,581 ,376

Costs

Capital costs 4,500 - - - - -

Licenses 407,500 25,000 25,000 25,000 25,000 25,000

Consultancy costs 37,500 - - - - -

Training costs 19,724 60,000 60,000 60,000 60,000 60,000

Other revenue costs 106,200 - - - - -

Total costs in period 575,424 85,000 85,000 85,000 85,000 85,000

Benefits

Incremental revenue - 556 612 673 740 815

Productivity
improvements - 336,055 336,055 336,055 336,055 336,055

Direct cost savings - - - - - -

Sales and admin
cost savings - - - - - -

Total benefits in
period - 336,611 336,667 336,728 336,795 336,869

Net benefits / (costs) (575,424) 251,611 251,667 251,728 251,795 251,869

Balance carried (323,813

forward (575,424) ) (72,147) 179,581 431,376 683,245

Payback Period
Year 3
Orbisprotect
Limited

Costs summary Year 0 Year 1 Year 2 Year 3 Year 4 Year 5

PCs (9 PCs - 3 PCs
4,500.00
per depot) 500

Capital costs 4,500 - - - - -

License cost
120,000.
(based on 40
00
users)
Additional License 250 287,500.
(115 users) 0 00
Annual 25,000. 25,000. 25,000. 25,000. 25,000.
Maintenace 00 00 00 00 00
Total License
costs 407,500 25,000 25,000 25,000 25,000 25,000

37,500.0
Consultancy costs 0
Total
Consultancy
37,500
costs - - - - -

Cost per 49.3

Chargeable (AVG) 1
Training costs (400
19724
hrs) 400
Training costs per 60,000. 60,000. 60,000. 60,000. 60,000.
year 00 00 00 00 00
Total Training
costs 19,724 60,000 60,000 60,000 60,000 60,000

Miscellaneous 5,000.00
40,000.0
Connect with Aura 0
19,000.0
Set-Up Server 0
20,000.0
Internal bandwith 0
Recording data
22,200.0
costs (2 HR
0
dedicated)

Other costs 106,200 - - - - -