PROJECT MANAGEMENT PLAN

SAP BUSINESS ONE IMPLEMENTATION PROJECT

FOR THE JVS-FRAVI PHARMACY

ADDRESS
POBLACION, GUINDULMAN, BOHOL

DATE
JULY 30, 2019

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TABLE OF CONTENTS

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 INTRODUCTION

JVS-FRAVI PHARMACY has been successful in its distribution sector for sustaining its market share
because of its strategic management operations. Additionally, flow of information from the
middle management to operations is direct. It has a leverage for excellent supplier and customer
service by capitalizing its subsidiaries to do a network of value added services. With the re-
engineering of information system, JVS-FRAVI PHARMACY can position itself with a solid business
process technological infrastructure intentionally made to methodically analyze previously
recorded data to gain insight for business planning.

PROJECT MANAGEMENT APPROACH

The Project Manager, GRACE ANN BULAQUINA, has the overall authority and responsibility for
managing and executing this SAP implementation project according to this Project Plan. The
project team will consist of the project manager, the functional staff, and technical staff. The
project manager will work with all resources to perform project planning. All project
management plans will be reviewed and approved by the Project Sponsor. All funding decisions
will also be made by the Project Sponsor. Any delegation of approval authority to the project
manager should be done in writing and be signed by both the Project Sponsor and Project
Manager.

The project team will be a matrix in that team members from each organization continue to
report to their organizational management throughout the duration of the project. The project
manager is responsible for communicating with organizational managers on the progress and
performance of each project resource.

I. STATEMENT OF WORK

The JVS-FRAVI PHARMACY has recently approved the SAP BUSINESS ONE Implementation Project
for its distribution sector in support of its strategic plan to enhance operational processes. In
order to provide more timely feedback to internal and external stakeholders, the implementation
will focus on transaction recording efficiency in a centralized IT environment for improved
financial reporting generation.

JVS-FRAVI PHARMACY will be able to generate the data faster through the Point of Sales
implementation. Furthermore, the implementation of this system will help the business monitor
its performance and improve it.

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PERIOD OF PERFORMANCE

The period of performance for the project is 35 man days beginning on July 29, 2019. All work
must be scheduled to complete within this timeframe. Any modifications or extensions will be
requested through Project Manager and provider contracting officers for review and discussion.

PLACE OF PERFORMANCE

The selected provider for the re-implementation project will perform a majority of the work at
its own facility. POBLACION, GUINDULMAN, BOHOL

WORK REQUIREMENTS

As part of the implementation project, the vendor will be responsible for performing tasks
throughout various stages of this project. The following is a list of these tasks which will result in
the successful completion of this project:

1. Project Implementation Plan

2. Blueprint process
3. Realization

SCHEDULE/MILESTONES

The below list consists of the initial milestones identified for the SAP Business One
Implementation Project:

Project Management Plan - First Half July 24, 2019

Project Management Plan - Final Half July 29, 2019
To-be Blueprint August 7, 2019
Project Realization -
Master Data Migration and System Initialization August 12, 2019
Project Realization -
Setup and GL Account Determination August 14, 2019
Project Realization -
User-Defined Fields, Queries, Approval Procedures, and Alerts August 19, 2019
Go-Live (Demo) September 2, 2019

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ACCEPTANCE CRITERIA

For the SAP BUSINESS ONE IMPLEMENTATION Project, the acceptance of all deliverables will
reside with JVS-FRAVI PHARMACY’S Chief Operating Officer, MRS. ZITA A. HINACAY and
Accounting In-charge, MRS. ELVIRA DALAGUIT. This office will maintain a small team advisors:
business unit heads, and the project manager’s team, in order to ensure the completeness of
each stage of the project and that the scope of work has been met. Once a project phase is
completed and the vendor provides their report/presentation for review and approval, the COO
will either sign off on the approval for the next phase to begin, or reply to the provider, in writing,
advising what tasks must still be accomplished.

Once all project tasks have been completed, the project will enter the handoff/closure stage.
During this stage of the project, the provider will provide their project closure report and project
task checklist to COO. The acceptance of this documentation by the COO will acknowledge
acceptance of all project deliverables and that the provider has met all assigned tasks.

Any discrepancies involving completion of project tasks or disagreement between the company
and the chosen provider will be referred to both organizations’ contracting offices for review and
discussion.

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 PROJECT SCOPE MANAGEMENT

PROJECT PURPOSE AND JUSTIFICATION

The Project Implementation been approved to plan, design, build, and implement an upgraded
version tool for the users of the distribution sector of JVS-FRAVI Pharmacy. The project aims to
help improve the business’ data generation process through the use of a new system.

PROJECT SCOPE STATEMENT

Acceptance criteria are the criteria which must be met for the project to be considered
complete and accepted by management. This section is important as it sets the
expectations of what will and will not constitute acceptance of the project. Without clear
definition of what will be accepted, there may be uncertainty across the project team and
stakeholders. Acceptance criteria may be both qualitative and quantitative.

Acceptance criteria have been established for the SAP Project to ensure thorough vetting
and successful completion of the project. The acceptance criteria are both qualitative
and quantitative in nature. All acceptance criteria must be met in order to achieve success
for this project:

1. Meet all deliverables within scheduled time and budget tolerances

2. Reduce schedule delays
3. Reduce budget overruns
4. Accomplish an overall performance improvement in program metrics

The Project Manager shall determine if a phase is complete and satisfactorily delivered by
evaluating requirements checklist, timeline review, and reconciling the projected against
the actual output.

This project does not include:

1. Third party application for integration
2. Installation at satellite offices are not included in this project plan.

Project constraints are limitations that the project faces due to funding, scheduling/time,
technology, or resources. Constraints may also be physical (i.e. inadequate space or
facilities). Constraints must be carefully planned for and communicated to all
stakeholders as they may require an elevated level of urgency or flexibility to work within
and successfully complete the project. This section should describe the project’s

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 constraints to ensure that all stakeholders understand the limitations within which the
project must be completed.

ROLES AND RESPONSIBILITIES

In order to successfully manage a projects’ scope it’s important that all roles and responsibilities
for scope management are clearly defined. This section defines the role of the Project Manager,
Project Team, Stakeholders and other key persons who are involved in managing the scope of
the project. It should state who is responsible for scope management and who is responsible for
accepting the deliverables of the project as defined by the projects’ scope. Any other roles in
scope management should also be stated in this section.

The Project Manager, Sponsor and team will all play key roles in managing the scope of this
project. As such, the project sponsor, manager, and team members must be aware of their
responsibilities in order to ensure that work performed on the project is within the established
scope throughout the entire duration of the project. The table below defines the roles and
responsibilities for the scope management of this project.

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Name Role Responsibilities
ZITA A. HINACAY Sponsor/Owner - Approve or deny scope change requests as
appropriate
- Evaluate need for scope change requests
- Accept project deliverables
- Sign-off phase acceptance or gate review
GRACE ANN Project Manager - measure and verify project scope
BULAQUINA - facilitate scope change request
- facilitate impact assessments of scope
change request
- organize and facilitate scheduled change
control meeting
- communicate outcomes of scope change
request
- approve business process blueprint
- approve technical requirements report,
installation, and technical review
Lyca Bastasa PM Members - Measure and verify project scope
Jennife Gultiano - Validate scope change requests
Ma. Jessa - Prepare business blueprint
Bernados - Conduct hardware and software
Rhea Sagaral preparation
- Conduct documentation
- Facilitate team level change review process
Scope Management Roles and Responsibilities

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 PROJECT SCOPE MANAGEMENT
WORK BREAKDOWN STRUCTURE (WBS)

INTRODUCTION
The Work Breakdown Structure presented here represents all the work required to complete this
project.

Using the Tree Structure View and the Tabular View, presented below are two organized and
detailed table view of the WBS.

In order to effectively manage the work required to complete this project, it will be
subdivided into individual work packages which will not exceed 65 man days of work. This
will allow the Project Manager to more effectively manage the project’s scope as the
project team works on the tasks necessary for project completion. The project is broken
down into five phases: the Blueprint Design phase; the Project Realization phase; the
Testing Phase; the Final Preparation Phase; and, the Going Live & Support Phase. Each of
these phases is then subdivided further down to work packages which will require no
more than 65 man days of work.

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 Work Breakdown Structure (WBS)
Tree Structure

SAP Implementation
Project

Blueprint Phase Project Realization Testing Phase Final Preparation Go-live and Support
Phase Phase Phase

Process Walk- Installation Unit Testing Training: Super-user Open Issues

through & End user Resolution

Final To-Be Blueprint Configuration System Testing Review and Finalize Review Support
Cutover Plan Procedures w/ Client

Gate Review and Gate Review and Scenario / String Schedule Production Gate Review and
Acceptance Sign-off Acceptance Sign-off Testing Cutover Acceptance Sign-off

Set SAP 8.8 system

Integration Testing
cutoff

End User Testing & Execute Production

Cutover
UA Testing
Backup DB & SQL
Server Maint. Plan
SAP Stress / Load /
Performance
Gate Review and
Acceptance Sign-off
SAP Security and
Authorizations

Gate Review and

Acceptance Sign-off

SAP Cut Over / Dry

Run Testing

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 Work Breakdown Structure (WBS)
Tabular Structure

Level 1 Level 2 Level 3

1 SAP BUSINESS 1.1 Blueprint 1.1.1 Process Walk-through
ONE Phase 1.1.2 Final To-Be Blueprint
Implementatio 1.1.3 Gate Review and Acceptance
n Project

1.2 Project 1.2.1 Installation

Realization Phase 1.2.2 Configuration
1.2.3 Gate Review and Acceptance

1.3 Testing Phase 1.3.1 Unit Testing

1.3.2 System Testing
1.3.3 Scenario / String Testing
1.3.4 Integration Testing
1.3.5 End User Testing & User Acceptance Testing
1.3.6 SAP Stress / Load / Performance
1.3.7 SAP Security and Authorizations
1.3.8 SAP Cutover / Dry Run Testing
1.3.9 Gate Review and Acceptance

1.4 Final 1.4.1 Training

Preparation Phase 1.4.2 Review and Finalize Cutover Plan
1.4.3 Schedule Production Cutover
1.4.4. Set SAP 8.8 System Cutoff
1.4.5 Execute Production Cutover
1.4.6 Backup DB & SQL Server Maintenance Plan
1.4.4 Gate Review and Acceptance Sign-off
1.5 Go-live and 1.5.1 Go-live and Support Phase
Support Phase 1.5.2 Open Issues Resolution
1.5.3 Review Support Procedures w/ Client
1.5.4 Gate Review and Acceptance Sign-off

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 In order to more clearly define the work necessary for project completion the WBS Dictionary is
used. The WBS Dictionary includes an entry for each WBS element. The WBS Dictionary includes
a detailed description of work for each element and the deliverables, budget and resource needs
for that element. The project team will use the WBS Dictionary as a statement of work for each
WBS element.

WBS DICTIONARY

WBS Element Name Definition Responsibility Resources

Code Assignment
1 1 SAP Business One All work to implement a SAP
Implementation new SAP B1 system.
System
2 1.1 Blueprint Phase The SAP Blueprint is a Internal project Headed by
detailed description of a management team the Project
company's business Manager
processes and system
requirements. ... The SAP
Blueprint document shows
all the important
configuration setting to
adapt the ERP to company
needs. A well-
defined SAP Blue print acts
as a foundation for
successful implementation
of the SAP system.
3 1.1.1 Process Walk- When performing Functional member
through our walkthrough procedur from Project
es we focus on the critical Management Team
path in the process where
transactions are initiated,
authorized, recorded,
processed and ultimately
reported in the general
ledger (or serve as the
basis for disclosures).
3 1.1.2 Final To-Be Final stage of blueprinting PM from both Headed by
Blueprint the Project
Manager

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3 1.1.3 Gate Review and Project sponsor as
Acceptance recommended by P

2 1.2 Data Preparation

Installation
Master Data Preparation
Project Realization Setup of GL Account
Phase Project Realization - User-
Defined Fields, Queries,
Approval Procedures, and
Alerts

3 1.2.1 Installation Installation of SAP Technical members

each from SAP and
Project management
Team

SCHEDULE MANAGEMENT PLAN

This section provides a general framework for the approach which will be taken to create the
project schedule. Effective schedule management is necessary for ensuring tasks are completed
on time, resources are allocated appropriately, and to help measure project performance. This
section should include discussion of the scheduling tool/format, schedule milestones, and
schedule development roles and responsibilities.

Project schedules for the SAP Project will start with the deliverables identified in the project’s
Work Breakdown Structure (WBS). Activity definition will identify the specific work packages
which must be performed to complete each deliverable. Activity sequencing will be used to
determine the order of work packages and assign relationships between project activities.
Activity duration estimating will be used to calculate the number of work periods required to
complete work packages. Resource estimating will be used to assign resources to work packages
in order to complete schedule development.

Once a preliminary schedule has been developed, it will be reviewed by the project team and any
resources tentatively assigned to project tasks. The project team and resources must agree to

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the proposed work package assignments, durations, and schedule. Once this is achieved the
project sponsor will review and approve the schedule and it will then be base lined.

In accordance with organizational standard, the following will be designated as milestones for all
project schedules:

● Completion of Blueprint Phase

● Completion of Project Realization
● Completion of Testing Phase
● Completion of Final Preparation
● Acceptance of Go-Live and Support

Roles and responsibilities for schedule development are as follows:

The project manager will be responsible for facilitating work package definition, sequencing, and
estimating duration and resources with the project team. The project manager will also create
the project schedule and validate the schedule with the project team, stakeholders, and the
project sponsor. The project manager will obtain schedule approval from the project sponsor
and baseline the schedule.

The project team is responsible for participating in work package definition, sequencing,
duration, and resource estimating. The project team will also review and validate the proposed
schedule and perform assigned activities once the schedule is approved.

The project sponsor will participate in reviews of the proposed schedule and approve the final
schedule before it is base lined.

The project stakeholders will participate in reviews of the proposed schedule and assist in its
validation.

SCHEDULE BASELINE AND WORK BREAKDOWN STRUCTURE

The WBS provides the work packages to be performed for the completion of the project. The
WBS Dictionary defines the work packages. The schedule baseline provides a reference point for
managing project progress as it pertains to schedule and timeline.

The Project Manager and team will determine the impact of the change on the schedule, cost,
resources, scope, and risks. If it is determined that the impacts will exceed the boundary
conditions then the change will be forwarded to the Project Sponsor for review and approval.
The boundary conditions are:

CPI less than 0.8 or greater than 1.2

SPI less than 0.8 or greater than 1.2

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 ACTIVITY LIST
Activity List
Project: 1.1.1. Process Walk-Through Date: April 1-June 7
Activity Activity Name Description of Work Responsibility
ID No.
1.1.1.1 Bookkeeping master data This activity consists of procedures to Bookkeeper
management add/edit an account title from the chart
of accounts, and assigning accounts in
the GL account determination.
1.1.1.2 Journal entry posting and This activity consists of defining all Bookkeeper
analysis, Financial journal entries for every business form,
Reporting and assigning accounts in the GL account
determination.
1.1.1.3 Payments process: This activity consists of process walk- Project Member
incoming and outgoing through determining the staffs,
departments, and forms involved.
1.1.1.4 Cash management This activity monitors of cash Check Disbursement
movements including checks, post-dated Officer
checks, deposits, bank reconciliation.
1.1.1.5 Asset management This activity includes monitoring of Project Manager
Asset Receiving
Asset Master File maintenance
Asset Issuance
Asset Transfer
Asset Depreciation
Asset Physical Count
Asset Disposal

1.1.1.6 Master Data management This activity includes master data: Technical Lead
addition, retrieval, deletion, and
modification.

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 ESTIMATE ACTIVITY DURATION

ESTIMATE ACTIVITY DURATION

Using Three-Point Estimate Technique:

Durations Estimate
Project: SAP Business One Implementation Project - Blueprinting Date: 04/01/2019
Activity Resource(s) Optimistic Most Pessimistic Estimated Reserve
Likely Activity
Duration
1001 Z. Hinacay 20 hrs. 25 hrs. 10 hrs. 25 hrs. +/- 5 hrs.
1001 E. Dalaguit 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.
1002 IT 30 hrs. 35 hrs. 0 hrs. 30 hrs. +/-5 hrs.
1003 AR Analyst 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.
1004 Sales 20 hrs. 25 hrs. 10 hrs. 25 hrs. +/- 5 hrs.
1005 Credit & 20 hrs. 25 hrs. 10 hrs. 25 hrs. +/- 5 hrs.
Collection
1006 Logistics 20 hrs. 25 hrs. 10 hrs. 25 hrs. +/- 5 hrs.
1007 Inventory & 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.
Purchasing Staff
1008 AP Analyst 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.
1009 Accounting +/- 5 hrs.
Associate
1010 Accounting 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.
Supervisor
1011 Treasury 25 hrs. 30 hrs. 10 hrs. 30 hrs. +/- 5 hrs.

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 PROJECT COMMUNICATION MANAGEMENT

ROLES

Project Sponsor
The project sponsor is the champion of the project and has authorized the project by signing the
project charter. This person is responsible for the funding of the project and is ultimately
responsible for its success. Since the Project Sponsor is at the executive level communications
should be presented in summary format unless the Project Sponsor requests more detailed
communications.

Project Board Member

They comprise the remaining top management aside from the CEO. They are responsible for
review and approval for major decisions pertaining to the project. They will convey their
recommendation to the Project Sponsor.

Key Stakeholders
Normally Stakeholders includes all individuals and organizations who are impacted by the
project. For this project we are defining a subset of the stakeholders as Key Stakeholders. These
are the stakeholders with whom we need to communicate with and are not included in the other
roles defined in this section. The Key Stakeholders includes executive management with an
interest in the project and key users identified for participation in the project.

Change Control Board

The Change Control Board is a designated group which is reviews technical specifications and
authorizes changes within the organizations infrastructure. Technical design documents, user
impact analysis and implementation strategies are typical of the types of communication this
group requires. This group has approval matrix from the project team, to the project board, and
finally, to the project sponsor.

Project Manager
The Project Manager has overall responsibility for the execution of the project. The Project
Manager manages day to day resources, provides project guidance and monitors and reports on
the projects metrics as defined in the Project Management Plan. As the person responsible for
the execution of the project, the Project Manager is the primary communicator for the project
distributing information according to this Communications Management Plan.

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Project Team
The Project Team is comprised of all persons who have a role performing work on the project.
The project team needs to have a clear understanding of the work to be completed and the
framework in which the project is to be executed. Since the Project Team is responsible for
completing the work for the project they played a key role in creating the Project Plan including
defining its schedule and work packages. The Project Team requires a detailed level of
communications which is achieved through day to day interactions with the Project Manager and
other team members along with weekly team meetings.

Steering Committee
The Steering Committee includes top management: Chief Executive Officer and Project Board
Members with members who are Sector Head and Chief Operating Officer. The Steering
Committee provides strategic oversight for changes which impact the overall organization. The
purpose of the Steering Committee is to ensure that changes within the organization are effected
in such a way that it benefits the organization as a whole. The Steering Committee requires
communication on matters which will change the scope of the project and its deliverables.

Technical Lead
The Technical Lead is a person on the Project Team who is designated to be responsible for
ensuring that all technical aspects of the project are addressed and that the project is
implemented in a technically sound manner. The Technical Lead is responsible for all technical
designs, overseeing the implementation of the designs and developing as-build documentation.
The Technical Lead requires close communications with the Project Manager and the Project
Team.

Functional Lead
The Technical Lead is a person on the Project Team who is designated to be responsible for
ensuring that all technical aspects of the project are addressed and that the project is
implemented in a technically sound manner. The Technical Lead is responsible for all technical
designs, overseeing the implementation of the designs and developing as-build documentation.
The Technical Lead requires close communications with the Project Manager and the Project
Team.

Communications Facilitator
This person will serve as a liaison among all members of the project team.

Project team directory for all communications is:

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 Name Title E-mail Office Phone Cell Phone
Zita A.
Project Sponsor xxx-xxx-xxxx 09482258471
Hinacay
Jennife
Technical Lead Jennifegultiano15@gmail.com 09300145030
Gultiano
Lyca
Functional Lead lycabbastasa@gmail.com xxx-xxx-xxxx 09456792056
Bastasa
Grace Ann Project
bulaquina102098@gmail.com xxx-xxx-xxxx 09105161560
Bulaquina Manager
Elvira Accounting In-
xxx-xxx-xxxx xxx-xxx-xxxx
Dalaguit charge

Communications Conduct:

Meetings:
The Project Manager will distribute a meeting agenda at least 2 weeks prior, if she will be present,
to any scheduled meeting and all participants are expected to review the agenda prior to the
meeting. During all project meetings the timekeeper will ensure that the group adheres to the
times stated in the agenda and the recorder will take all notes for distribution to the team upon
completion of the meeting. It is imperative that all participants arrive to each meeting on time
and all cell phones should be turned off or set to vibrate mode to minimize distractions. Meeting
minutes will be distributed no later than 24 hours after each meeting is completed.

Email:
All email pertaining to the SAP Project should be professional, free of errors, and provide brief
communication. Email should be distributed to the correct project participants in accordance
with the communication matrix above based on its content. All attachments should be in one of
the organization’s standard software suite programs and adhere to established company
formats. If the email is to bring an issue forward then it should discuss what the issue is, provide
a brief background on the issue, and provide a recommendation to correct the issue. The Project
Manager should be included on any email pertaining to the SAP Project.

Informal Communications:
While informal communication is a part of every project and is necessary for successful project
completion, any issues, concerns, or updates that arise from informal discussion between team
members must be communicated to the Project Manager so the appropriate action may be
taken.

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 COST MANAGEMENT PLAN

The Cost Management Plan defines how the costs on a project will be managed throughout the
project’s lifecycle. It sets the format and standards by which the project costs are measured,
reported, and controlled. Working within the cost management guidelines is imperative for all
project team members to ensure successful completion of the project. These guidelines may
include which level of the WBS cost accounts will be created in and the establishment of
acceptable variances. The Cost Management Plan:
● Identifies who is responsible for managing costs
● Identifies who has the authority to approve changes to the project or its budget
● How cost performance is quantitatively measured and reported upon
● Report formats, frequency and to whom they are presented

The Project Manager will be responsible for managing and reporting on the project’s cost
throughout the duration of the project. The Project Manager will present and review the
project’s cost performance during the monthly project status meeting. Using earned value
calculations, the Project Manager is responsible for accounting for cost deviations and presenting
the Project Sponsor with options for getting the project back on budget. All budget authority and
decisions, to include budget changes, reside with the Project Sponsor.

For the SAP Project, control accounts will be created at the fourth level of the WBS which is where
all costs and performance will be managed and tracked. Financial performance of the SAP Project
will be measured through earned value calculations pertaining to the project’s cost accounts.
Work started on work packages will grant that work package with 50% credit; whereas, the
remaining 50% is credited upon completion of all work defined in that work package. Costs may
be rounded to the nearest dollar and work hours rounded to the nearest whole hour.

Cost and Schedule Performance Index (CPI and SPI respectively) will be reported on a monthly
basis by the Project Manager to the Project Sponsor. Variances of 10% or +/- 0.1 in the cost and
schedule performance indexes will change the status of the cost to yellow or cautionary. These
will be reported and if it’s determined that there is no or minimal impact on the project’s cost or
schedule baseline then there may be no action required. Cost variances of 20%, or +/- 0.2 in the
cost and schedule performance indexes will change the status of the cost to red or critical. These
will be reported and require corrective action from the Project Manager in order to bring the cost
and/or schedule performance indexes back in line with the allowable variance. Any corrective
actions will require a project change request and be must approved by the CCB before it can be
implemented.

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Earned value calculations will be compiled by the Project Manager and reported at the monthly
project status meeting. If there are indications that these values will approach or reach the
critical stage before a subsequent meeting, the Project Manager will communicate this to the
Project Sponsor immediately.

COST ESTIMATE

The estimated costs for this project are included in the table below. As the project proceeds and
any additional costs become known, this cost estimate will be refined and communicated to all
project stakeholders.

Estimated Expended to Estimate to

Expense Variance
Budget Date Complete
Man days 105,000
Internal N/A N/A N/A NA
External- SAP N/A N/A N/A +/- Php
Provider
External – PM N/A N/A N/A +/- Php
Software 250,000 - 250,000 +/- 10,000Php
(License)
Hardware 100,000 - 100,000 +/- 5,000 Php
(Servers and
Workstation)
Other - - - +/- Php
Total 455,000 350,000

COST BENEFIT ANALYSIS

PROCUREMENT MANAGEMENT PLAN

INTRODUCTION

This Procurement Management Plan sets the procurement framework for this project. It will
serve as a guide for managing procurement throughout the life of the project and will be updated
as acquisition needs change. This plan identifies and defines the items to be procured, the types
of contracts to be used in support of this project, the contract approval process, and decision
criteria. The importance of coordinating procurement activities, establishing firm contract

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deliverables, and metrics in measuring procurement activities is included. Other items included
in the procurement management plan include: procurement risks and procurement risk
management considerations; how costs will be determined; how standard procurement
documentation will be used; and procurement constraints.

PROCUREMENT MANAGEMENT APPROACH

The Project Manager will provide oversight and management for all procurement activities under
this project. The Project Manager will work with the project team to identify all items to be
procured for the successful completion of the project. The Project Management Office (PMO)
will then review the procurement list prior to submitting it to the contracts and purchasing
department. The contracts and purchasing department will review the procurement items,
determine whether it is advantageous to make or buy the items, and begin the vendor selection,
purchasing and the contracting process.

PROCUREMENT DEFINITION

The following procurement items and/or services have been determined to be essential for
project completion and success. The following list of items/services, justification, and timeline
are pending PMO review for submission to the contracts and purchasing department:

Item/Service Justification Needed By

SAP B1 Licenses Needed for system migration from 8.8v to 9.3v August 15, 2019
v9.3 for the use of operations
12 Professional
19 Limited
SAP Hana Engine Needed infrastructure for SAP B1 9.3v September 30,
2019
SAP Needed for the installation, configuration, August 30, 2019
Implementation testing, and support
Services
SAP Maintenance Needed for patches and support services January 1, 2021
Backup Server – Needed as backup hardware for disaster September 30,
DELL T130 recovery 2019
VERITAS Needed for backup and recovery September 30,
2019
QNAP NAS TS- Needed as backup hardware September 30,
431X2 2G 4Bay 2019

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In addition to the above list of procurement items, the following individuals are authorized to
approve purchases for the project team:

Name Role
Zita Hinacay Project Sponsor
Grace Ann Bulaquina Project Manager
Rhea Sagaral Project Board Member
Ma. Jessa Bernados Project Board Member

TYPE OF CONTRACT TO BE USED

All items and services to be procured for this project will be solicited under firm-fixed price
contracts. The project team will work with the contracts and purchasing department to define
the item types, quantities, services and required delivery dates. The contracts and purchasing
department will then solicit bids from various vendors in order to procure the items within the
required time frame and at a reasonable cost under the firm fixed price contract once the vendor
is selected. This contract will be awarded with one base year and three option years.

PROCUREMENT RISKS

All procurement activities carry some potential for risk which must be managed to ensure project
success. While all risks will be managed in accordance with the project’s risk management plan,
there are specific risks which pertain specifically to procurement which must be considered:

- Unrealistic schedule and cost expectations for vendors

- Manufacturing capacity capabilities of vendors
- Conflicts with current contracts and vendor relationships
- Configuration management for upgrades and improvements of purchased technology
- Potential delays in shipping and impacts on cost and schedule
- Questionable past performance for vendors
- Potential that final product does not meet required specifications

These risks are not all-inclusive and the standard risk management process of identifying,
documenting, analyzing, mitigating, and managing risks will be used.

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PROCUREMENT RISK MANAGEMENT

As previously stated, project risks will be managed in accordance with the project’s risk
management plan. However, for risks related specifically to procurement, there must be
additional consideration and involvement. Project procurement efforts involve external
organizations and potentially affect current and future business relationships as well as internal
supply chain and vendor management operations. Because of the sensitivity of these
relationships and operations the project team will include the project sponsor and a designated
representative from the contracting department in all project meetings and status reviews.

Additionally, any decisions regarding procurement actions must be approved by the project
sponsor before implementation. Any issues concerning procurement actions or any newly
identified risks will immediately be communicated to the project’s contracting department point
of contact as well as the project sponsor.

COST DETERMINATION

For this project we will issue a Request for Proposal (RFP) in order to solicit proposals from various
vendors which describe how they will meet our requirements and the cost of doing so. All
proposals will include vendor support for items as well as the base and out-year costs. The
vendors will outline how the work will be accomplished, who will perform the work, vendors’
experience in providing these goods, customer testimonials, backgrounds and resumes of
employees performing the work, and a line-item breakdown of all costs involved. Additionally,
the vendors will be required to submit work breakdown structures (WBSs) and work schedules
to show their understanding of the pwork to be performed and their ability to meet the project
schedule.

All information must be included in each proposal as the proposals will be used as the foundation
of our selection criteria. Proposals which omit solicited information or contain incomplete
information will be discarded from consideration.

STANDARDIZED PROCUREMENT DOCUMENTATION

The procurement management process consists of many steps as well as ongoing management
of all procurement activities and contracts. In this dynamic and sensitive environment, our goal

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must be to simplify procurement management by all necessary means in order to facilitate
successful completion of our contracts and project. To aid in simplifying these tasks, we will use
standard documentation for all steps of the procurement management process. These standard
documents have been developed and revised over a period of many years in an effort to
continually improve procurement efforts. They provide adequate levels of detail which allows
for easier comparison of proposals, more accurate pricing, more detailed responses, and more
effective management of contracts and vendors.

The Project Management Office (PMO) maintains a repository on the company’s shared drive
which contains standard project management and procurement documentation that will be used
for this project. The following standard documents will be used for project procurement
activities:

● Standard Request for Proposal Template to include

- Background
- Proposal process and timelines
- Proposal guidelines
- Proposal formats and media
- Source selection criteria
- Pricing forms
- Statement of work
- Terms and Conditions
● Internal source selection evaluation forms
● Non-disclosure agreement
● Letter of intent
● Firm fixed price contract
● Procurement audit form
● Procurement performance evaluation form
● Lessons learned form

PROCUREMENT CONSTRAINTS

There are several constraints that must be considered as part of the project’s procurement
management plan. These constraints will be included in the RFP and communicated to all
vendors in order to determine their ability to operate within these constraints. These constraints
apply to several areas which include schedule, cost, scope, resources, and technology:

Schedule:

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● Project schedule is not flexible and the procurement activities, contract administration, and
contract fulfillment must be completed within the established project schedule.

Cost:
● Project budget has contingency and management reserves built in; however, these reserves
may not be applied to procurement activities. Reserves are only to be used in the event of
an approved change in project scope or at management’s discretion.

Scope:
● All procurement activities and contract awards must support the approved project scope
statement. Any procurement activities or contract awards which specify work which is not in
direct support of the project’s scope statement will be considered out of scope and
disapproved.

Resources:
● All procurement activities must be performed and managed with current personnel. No
additional personnel will be hired or re-allocated to support the procurement activities on
this project.

Technology:
● Parts specifications have already been determined and will be included in the statement of
work as part of the RFP. While proposals may include suggested alternative material or
manufacturing processes, parts specifications must match those provided in the statement
of work exactly.

CONTRACT APPROVAL PROCESS

The first step in the contract approval process is to determine what items or services will require
procurement from outside vendors. This will be determined by conducting a cost analysis on
products or services which can be provided internally and compared with purchase prices from
vendors. Once cost analyses are complete and the list of items and services to be procured
externally is finalized, the purchasing and contracts department will send out solicitations to
outside vendors. Once solicitations are complete and proposals have been received by all
vendors the approval process begins. The first step of this process is to conduct a review of all
vendor proposals to determine which meet the criteria established by the project team and the
purchasing and contracts department. All purchases must be approved by the Contract Review
Board. For these larger purchases the contract review board will meet to determine which

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contract will be accepted. The Contract Review Board consists of representatives from the
project team, purchasing and contracts department, finance, and the PMO.

DECISION CRITERIA

The criteria for the selection and award of procurement contracts under this project will be based
on the following decision criteria:
- Ability of the vendor to provide all items by the required delivery date
- Quality
- Cost
- Expected delivery date
- Comparison of outsourced cost versus in-sourcing
- Past performance

These criteria will be measured by the contracts review board and/or the Project Manager. The
ultimate decision will be made based on these criteria as well as available resources.

VENDOR MANAGEMENT

The Project Manager is ultimately responsible for managing vendors. In order to ensure the
timely delivery and high quality of products from vendors the Project Manager, or his/her
designee will meet weekly with the contract and purchasing department and each vendor to
discuss the progress for each procured item. The meetings can be in person or by teleconference.
The purpose of these meetings will be to review all documented specifications for each product
as well as to review the quality test findings. This forum will provide an opportunity to review
each item’s development or the service provided in order to ensure it complies with the
requirements established in the project specifications. It also serves as an opportunity to ask
questions or modify contracts or requirements ahead of time in order to prevent delays in
delivery and schedule. The Project Manager will be responsible for scheduling this meeting on a
weekly basis until all items are delivered and are determined to be acceptable.

RISK MANAGEMENT PLAN

This section provides a general description for the approach taken to identify and manage the
risks associated with the project. It should summarize the approach to risk management on this

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project. Risk Management Plan, Risk Register along with templates are used for a risk assessment
documentation.

The approach for managing risks for the SAP Project includes a methodical process by which the
project team identifies, scores, and ranks the various risks. Every effort will be made to
proactively identify risks ahead of time in order to implement a mitigation strategy from the
project’s onset. The most likely and highest impact risks were added to the project schedule to
ensure that the assigned risk managers take the necessary steps to implement the mitigation
response at the appropriate time during the schedule. Risk managers will provide status updates
on their assigned risks in the bi-weekly project team meetings, but only when the meetings
include their risk’s planned timeframe.

Upon the completion of the project, during the closing process, the project manager will analyze
each risk as well as the risk management process. Based on this analysis, the project manager
will identify any improvements that can be made to the risk management process for future
projects. These improvements will be captured as part of the lessons learned knowledge base.

As organizations begin new projects they begin operating in an area of uncertainty that comes
along with developing new and unique products or services. By doing so, these organizations
take chances which results in risk playing a significant part in any project. The purpose of the risk
management plan is to establish the framework in which the project team will identify risks and
develop strategies to mitigate or avoid those risks. However, before risks can be identified and
managed, there are preliminary project elements which must be completed. These elements are
outlined in the risk management approach.

This project is considered a medium risk project as it has an overall risk score of 24 on a scale
from 0 to 100. The project risk score is the average of the risk scores of the most significant risks
to this project. A risk score below 16 is low risk project, a score between 16 and 45 is a medium
risk project and a score above 45 is a high risk project.

Before risk management begins it is imperative that a foundation is established for providing
structured project information, thus, the following project elements were completed and
defined prior to developing this Risk Management Plan:

● Define work scope, schedule, resources, and cost elements

o Develop project WBS/WBS dictionary (SEE SCOPE MANAGEMENT)
o Develop master schedule and detailed schedules (SEE SCHEDULE
MANAGEMENT)

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 o Estimate project cost and finalize budget (SEE COST MANAGEMENT)
o Identify required and available resources
o Establish performance measurement metrics

● Define minimum and maximum baseline thresholds

o Schedule
o Resources
o Cost

● Baseline reporting requirements

o Format
o Frequency of distribution
o Distribution list

● Define Risk Management Roles and Responsibilities

o Project Manager chairs the risk assessment meetings
o Project team participates in risk assessment meetings and members serve as
meeting recorder and timekeeper
o Key stakeholders participate in risk assessment meetings
o Project Sponsor may participate in risk assessment meetings

TOP THREE RISKS

The top three high probability and high impact risks to this project are:

Hardware Incompatibility
Due to multiple hardware requirements from separate manufacturers, incompatibility
and similar issues may arise. The project manager through the technical consultant will
mitigate this risk by sourcing industry accepted and published journals about the technical
specifications. A Specifications Review Report and Technical Compliance Report are to be
issued before and after hardware installations.

In any event of dissimilarity, nonconformity and alteration, a communication of possible

consequences will be made by the party who has the first knowledge. Details should be

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 logged in the Risk Register and decision must be reached immediately by the Project
Board Members.

Out of Scope Implementation Services

Due to the standard number of man days committed in the contract with the
implementation provider while the detailed blueprinting phase is only a subsequent
stage, it is very likely to chance upon additional man days for customizations. Such
customizations may be in the form of forms, reports, and other requirements.

The Project Manager, Functional Consultant and Technical Consultant shall identify all
customizations, communicate their findings including utilization of man days with the
Project Board Members, and present the report to the implementation provider.

Additional man days will only be approved by the Project Sponsor, as recommended by
the Project Manager. In the event of non-approval, the process will adapt existing practice
and employ compensating supporting systems through additional documentation or
processes.

Delay and Incomplete Implementation

Both the project proponent and SAP implementer may contribute actions that can cause
delay and incomplete implementation. The project manager, through the functional
consultant, will mitigate this risk by issuing communications of

1. functional requirements checklist with timeline and compliance review

2. phase or gate review

3. SAP implementer task and schedule compliance

The Project Team Members shall agree on allowable number of man days’ delay or no delay at
all.

RISK MANAGEMENT APPROACH

The approach we have taken to manage risks for this project included a methodical process by
which the project team identified, scored, and ranked the various risks. The most likely and
highest impact risks were added to the project schedule to ensure that the assigned risk
managers take the necessary steps to implement the mitigation response at the appropriate time

30
during the schedule. Project Board Members are risk managers who will provide status updates
on their assigned risks in the as-needed project team communications, but only when the
communications include their risk’s planned timeframe. Upon the completion of the project,
during the closing process, the project manager will analyze each risk as well as the risk
management process. Based on this analysis, the project manager will identify any
improvements that can be made to the risk management process for future projects. These
improvements will be captured as part of the lessons learned knowledge base.

RISK IDENTIFICATION

For this project, risk identification was conducted in the initial project risk assessment meeting.
The method used by the project team to identify risks was the Crawford Slip method. The project
manager leads the risk assessment identification based on similar projects experienced. Meeting
and interview to each team member allowed recording of as many risks as possible.

Expert Interview
The expertise of a certified project manager, a functional consultant with previous
support relationship, and a technical consultant who made an actual implementation to
XXX are employed for this project. The reviews revealed several risks which were then
mitigated by chartering the project management plan on top of the standard SAP Business
One accelerated implementation program. The remaining risks are included in the Risk
Register.

Risk Assessment Meeting

At the formal acceptance meeting held with key team members and stakeholders, risks
were identified and added to the project plan and Risk Register.

Historical Review of the First SAP Implementation Project

The project team reviewed the history of the first project in order to determine the most
common risks and the strategies used to mitigate those risks.

RISK QUALIFICATION AND PRIORITIZATION

In order to determine the severity of the risks identified by the team, a probability and impact
factor was assigned to each risk. This process allowed the project manager to prioritize risks
based upon the effect they may have on the project. The project manager utilized a probability-
impact matrix to facilitate the team in moving each risk to the appropriate place on the chart.

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Once the risks were assigned a probability and impact and placed in the appropriate position on
the chart, the recorder captured the finished product and the project manager moved the
process on to the next step: risk mitigation/avoidance planning.

RISK MONITORING

The most likely and greatest impact risks have been added to the project plan to ensure that they
are monitored during the time the project is exposed to each risk. At the appropriate time in the
project schedule a Risk Manager is assigned to each risk. During the project team meeting or
written correspondence, the Risk Manager for each risk will discuss the status of that risk;
however, only risks which fall in the current time period will be discussed. Risk monitoring will
be a continuous process throughout the life of this project. As risks approach on the project
schedule the project manager will ensure that the appropriate risk manager provides the
necessary status updates which include the risk status, identification of trigger conditions, and
the documentation of the results of the risk response.

RISK MITIGATION AND AVOIDANCE

The project manager has led the project team in developing responses to each identified risk. As
more risks are identified, they will be qualified and the team will develop avoidance and
mitigation strategies. These risks will also be added to the Risk Register and the project plan to
ensure they are monitored at the appropriate times and are responded to accordingly.

The risks for this project will be managed and controlled within the constraints of time, scope,
and cost. All identified risks will be evaluated in order to determine how they affect this triple
constraint. The project manager, with the assistance of the project team, will determine the best
way to respond to each risk to ensure compliance with these constraints.

In extreme cases it may be necessary to allow flexibility to one of the project’s constraints. Only
one of the constraints for this project allows for flexibility as a last resort. If necessary, funding
may be added to the project to allow for more resources in order to meet the time (schedule)
and scope constraints. Time and scope are firm constraints and allow for no flexibility. Again,
the cost constraint is flexible only in extreme cases where no other risk avoidance or mitigation
strategy will work.

RISK REGISTER

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The Risk Register for this project is a log of all identified risks, their probability and impact to the
project, the category they belong to, mitigation strategy, and when the risk will occur. The
register was created through the initial project risk management meeting led by the project
manager. During this meeting, the project team identified and categorized each risk.
Additionally, the team assigned each risk a score based on the probability of it occurring and the
impact it could potentially have. The Risk Register also contains the mitigation strategy for each
risk as well as when the risk is likely to occur.

Based on the identified risks and timeframes in the risk register, each risk has been added to the
project plan. At the appropriate time in the plan—prior to when the risk is most likely to occur—
the project manager will assign a risk manager to ensure adherence to the agreed upon
mitigation strategy. The each risk manager will provide the status of their assigned risk at the bi-
weekly project team meeting for their risk’s planned timeframe.

The Risk Register will be== maintained as by the Project Manager.

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 STAFFING MANAGEMENT PLAN

The SAP Business One Implementation Project will consist of a matrix structure with support from
various internal organizations. Work will be performed internally and outsourced from vendor
and service providers.

Staffing requirements for the SAP Project include the following:

Project Manager (1 position) – responsible for all management for the project implementation.
The Project Manager is responsible for planning, creating, and/or managing all work activities,
variances, tracking, reporting, communication, performance evaluations, staffing, and internal
coordination with functional managers.

Technical Lead (1 position) – responsible for oversight of all hardware and software requirement
tasks for the SAP Project as well as ensuring compliance with quality standards. Responsible for
working with the Project Manager to provide monitoring all technical reports. Responsibilities
also include assisting with risk identification, determining impacts of change requests, and status
reporting. He will be managed by the Project Manager who will provide performance feedback
to the functional manager.

Functional Lead (1 position) – responsible for oversight of all functional and accounting
requirement tasks for the SAP Project as well as ensuring compliance with quality standards.

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Responsible for working with the Project Manager to provide all functional reports including as-
is business processes. Responsibilities also include assisting with risk identification, determining
impacts of change requests, and status reporting. He will be managed by the Project Manager
who will provide performance feedback to the functional manager.

RESOURCE CALENDAR

The SAP Project will require all project team members for the entire duration of the project
although levels of effort will vary as the project progresses. The Project is scheduled to last 65
mandays.

COST BASELINE

The cost baseline for the SAP project includes all budgeted costs for the successful completion
of the project.

Project Phase Budgeted Total Comments

Pre-Planning Completion of the Project
Management Plan

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Blueprinting Completion of Final Blueprint
for Configuration
Configuration Completion of installation,
system initialization, setup,
and master data upload.
Testing Includes training and testing
(see Scope Management –
Testing)
Go-live and support Transition from SAP 8.8 to
9.3 and shutdown of 8.8
version.

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 TRANSITION OUT PLAN

This plan formally documents the process for the transition of the powers, duties, activities,
and functions of tasks and tools for the SAP Business One Implementation contract (Contract
# 1001). It describes the approach to transitioning work and employees from Manual to SAP.
The contract is for the purchase and implementation of a new SAP system for JVS-FRAVI
Pharmacy. This system will allow the Project Management Team to integrate reporting into
a consolidated database. This contract will be completed no later than 35 days after contract
award. The period of performance is from August 25, 2019 to September 30, 2019.

TRANSITION APPROACH
For this transition, JVS-FRAVI Pharmacy will maintain its existing staff on-site throughout the
transition period. No additional staffing requirements are anticipated to complete the
migration. The transition is expected to take 35 mandays to complete. Immediately prior
to the transition, JVS-FRAVI Pharmacy will stand up its transition team in order to facilitate
the activities necessary for successful transition. It is assumed that the Project Management
Team will have its staff on site at the beginning of the 35-day transition period and will
establish a similar team to work with JVS-FRAVI Pharmacy to coordinate the contract’s
transition. It is also assumed that JVS-FRAVI Pharmacy will provide adequate workspace for
both contractors throughout the duration of the transition. The Project Management Team
should also designate a transition project manager to work with both contractors
throughout the transition.

TRANSITION TEAM ORGANIZATION

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 The following chart illustrates the transition team members from XXX, Xxx Seed, and DUX.
as well as the roles and responsibilities of each team member.

Organization Title Roles/Responsibilities

Bulaquina Transition Project Coordinate activities between contractors
Project Manager throughout transition; provide workspace for
Management all transition staff; facilitate transition
Team (Ms. meetings as required
Grace
Bulaquina)
Jennife Contracting Officer Responsible for overseeing all contract
Gultiano actions and deliverables; responsible for
(Bulaquina ensuring accountability on all funding and
Project budget items pertaining to the contract
Management)
Bulaquina Transition Project Work with SCG and XYZ PMs to coordinate
Project Manager and schedule all transition activities; provide
Management weekly reporting on transition progress;
(Ms. Grace Ann ensure all applicable property and tools are
Bulaquina) included as part of transition
Bulaquina IT Transition Lead Ensure all IT activities are completed during
Project transition; document all IT processes, tasks,
Management and activities for transition to XYZ
(Lyca Bastasa)
Bulaquina Configuration Manager Ensure all training documentation is
Project complete; ensure completion of user and
Management technical manuals; ensure all documentation
(Ma. Jessa is in accordance with SCG standards; ensure
Bernados) proprietary materials are not part of
transition
Bulaquina Transition Project Work with SCG and ABC PMs; ensure all
Project Manager transition deliverables are received and
Management understood; identify any gaps in transition
(Ms. Grace Ann activities
Bulaquina)
Bulaquina IT Transition Lead Ensure continuity of all IT activities
Project throughout transition; ensure receipt of
Management

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(Lyca Bastasa adequate IT documentation of all processes,
tasks, and activities
Bulaquina Configuration Manager Ensure all training documentation received
Project addresses all planned training items; ensure
Management standardization of all transitioned
(Ma. Jessa documentation
Bernados)

HANDOVER AND ACCEPTANCE

Bulaquina Project Management Team (SAP Business One), through its Project Manager, will
make the determination of when transition is completed and will provide formal acceptance
indicating such. To do this, transition PM’s will utilize the established transition checklist in
order to determine that all activities associated with the transition have been completed.
The PM will also meet with the transition PMs from each contractor to ensure that all
concerns and issues have been met and addressed appropriately. Once the PM has formally
accepted the transition, the checklist and supporting documentation will be signed and
accepted by the JVS-Fravi Pharmacy’s project sponsor and the chief operating officer. The
last step is the formal acceptance and signature of the JVS-Fravi Pharmacy and contracting
officer representative. It is only after all of these approvals and signatures are in place that
the transition will be considered complete.

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SPONSOR ACCEPTANCE

Approved by the Project Sponsor:

Date: August 25, 2019

Zita Hinacay
Project Sponsor

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