Critical Analysis Of A Major Oil Project: Time, Cost, And Quality Factors

Purpose of the Project

The main purpose of the project is to develop a platform for AMINA Inc so that the company is able to achieve success in the global market. In other words, the main target of the project is to develop a multi-national marketing plan for the company in order to enable it to get access to the global market. However, the preparation of the plan is not easy due to the large scale of the project (Boud, Cohen and Sampson 2014). Moreover, the success of the project depends largely on the estimated finances and timeline for completion of the project. Hence, the project plan is prepared keeping in mind all these factors as well as maintaining maximum accuracy in all the estimations.

There are several merits of project plan that are discussed below.

1. The project plan provides a path that can be followed for execution of the project. A project can be executed in several ways but the desired way is the most cost-efficient one and the least time consuming one (Burke 2013). These can be determined by preparing a proper project plan with the most accurate estimations.
2. The project plan can be used like a project blueprint i.e. the overall structure of the project including chronological order of the project tasks can be included within the project plan.
3. The project plan also gives a clear idea about the project to all the members of the project team and employees of the company. This will also enable them to understand their duties and performances that will ultimately affect the outcomes of the project.
4. The project plan also gives an estimated timeline required to complete the project as well as the overall budget that will be required to finance the project.

The limitations of project plan are explained in the following points.

1. The basic plan of the project is primarily prepared in the light of a few estimations that contains some manual and numerical errors. These errors cause significant adverse effects on the project on a whole (Heagney 2016). Amid planning of the proposed project, the precision of estimations is constantly kept up to the most astounding conceivable rate. Nevertheless, unanticipated accidents cause immense deviation of schedule and budget from the actually estimated values.
2. In the project plan, the details of suppliers and vendors are not added as they are contracted with after the preparation of project plan and budget. Hence, the errors in resources quality or quantity are not parts of the project plan and cannot be solved using the project plan.

A project scope is the list of outcomes that can be controlled or achieved by a particular project without any extra resources or time. The merits of project scope are as follows.

1. The achievable outcomes of a project can be determined from the list provided by the project scope.
2. The project scope also determines the limitations of the project i.e. the outcomes that cannot be achieved by the overall project. Hence, the project scope determines both the achievable and non-achievable outcomes of a project.

The limitations of project scope are as follows.

1. Project scope only consists of the list of achievable and non-achievable targets but no methodologies. Methodologies are important parts of projects but they cannot be prepared using project scope statements.
2. Modifications in the targets of a project are not accommodated with the entire list of project scope. Hence, project modifications are not affected by the project scope.

The company will encounter critical changes in the business condition once it accesses worldwide market utilizing overall promoting. The business condition can be influenced by two fundamental components – micro (interior) and macro (external). The micro variables incorporate monetary state of the organization, accessible technical support, labor and administrations (Heldman 2015). Moreover, macro components incorporate market changes, prevalence of the administrations of the organization, monetary changes in the market, accessibility of providers and others. Different scientists have outlined different models for sorting these small scale and large scale variables identified with the business condition of the organization. One of them is PESTEL Model.

PESTEL model of six factors that affect the business of the company. These six factors have significant effect on the macro environment of the company. These six factors are as follows.

P – Political (licensing of business, allocation of land)

Political factors will significantly affect the business of the company since it is looking for multinational marketing. The marketing outcomes will depend largely on the political condition of the countries where the company will choose to market (Hwang and Ng 2013). Moreover, the company will also require marketing license for marketing, the approval of which will depend on the political situation of the country.

E – Economic (Financial factors)

Economic factors have major impacts on any business venture. Economic factors in this case include marketing costs, manufacturing costs, shipping costs and others. Unless there is a significant cost benefit from the marketing, the project will be a failure.

S – Social (Popularity)

The main objective of marketing is to increase the company’s popularity that will boost the business of the company. Hence, the multinational marketing should be done in such a way that the popularity of the company in the other countries also increase significantly (Heldman 2015). This will enable the company to gain significant business from the different countries.

T- Technological (Information Technology Setup)

Merits and Limitations of Project Plan

Technological setup is an important aspect of business systems nowadays. The advertisements, promotions, information systems management and other factors are enhanced by the upgraded technical setup of the company.

E – Environmental

Environment factors also affect the business of a company. For large industrial companies, the industries must be placed away from green eco-system zones.

L – Legal (Licensing, Land disputes, work permit)

Legal factors will affect the startup of the company in the foreign lands. These legal factors include business licensing, disputes over the chosen site or land, permission for business operations and others.

In order to prepare the project plan and ensure the success of the project, several types of research are to be undertaken. The research requirements are as follows.

Primary Research – In this project, essential (primary) research will be used keeping in mind the end goal to dissect the current worldwide economic situations and the customers’ necessities from the market. This can be directed in type of studies or surveys and the essential information should be gathered from this exploration. 

Secondary Research – The optional (secondary) research will be led in view of the past records and insights of the market. This will give an unmistakable thought with respect to how the association can profit by overall marketing internationally.

Merits of Stakeholder Analysis are as follows.

• Stakeholders roles are easily explained in terms of the project.
• The project duties are allocated among all the related stakeholders.

Limitations of Stakeholder Analysis are as follows.

• The post of the each stakeholder individual are not defined in the analysis.
• The existing skill sets of the each personnel stakeholder are not determined from stakeholder analysis.

The merits of constraints analysis are as follows.

• Project limitations can be determined.
• Project scope can be determined by mitigating the constraints of the project.

The limitations of constraints analysis are as follows.

• The analysis does not suggest any mitigating method for unexpected constraints.
• Solvable constraints are not highlighted.

The risk management plan is shown below.

Risk	Risk Source	Management Plan
Financial Loss and Recession	Negative changes in the global market	The worldwide market changes are to be observed closely and changes are to be made in the business framework likewise
System Failure	System errors and crashes	After the servers are associated, steps are to be taken so as to prevent any accidents or significant blunders
Loss of Popularity	Low service quality and customer satisfaction	It must be guaranteed that the best nature of administrations are given to meet client requests
Loss of Market Share	Rival companies	The organization ought to change and add more assortments of administrations to keep up market intensity

It can be seen that there are two axes separated by an equilibrium centre line. One axis represents the driving forces of a project while the other represents the restraining forces. The driving forces include increase in efficiency, demands of the customers, executive mandate and trust in the unit leader. These factors are beneficial for the project and drive the project towards a positive outcome (Kerzner 2013). On the other hand, the restraining forces capital investment, fear, lack of incentives and lack of training. These factors negatively affect a project and hence, should be handled properly in order to avoid the negative effects and manage the project to gain the best possible outcomes.

From the diagram, it can be seen that there are five M’s that are manpower, machines, materials, measurement and method. The effects of these resources in a project are explained below.

Manpower – Manpower is the resource that executes the project according to the plan and drives the project towards a successful outcome.

Machines – Machines are used in a project to set up a construction framework or an information set up. While construction machines are used to build some building infrastructures, technical machines like computers, telephones and others are used to create a communication network and information system of the company.

Materials – Materials are important resources in projects. Materials are used to build certain set ups and must be procured from an external vendor at a suitable price (Labuschagne 2016). Moreover, the materials should also be of the best quality in order to enhance the quality of the project.

Merits and Limitations of Project Scope

Measurement – Measurement defines the limits of the project that must be maintained in order to generate a positive outcome from the project.

Method – Any project is executed using a suitable method. A project has different approaches with different types of methods. However, not all methods are cost-efficient or time-saving, hence, the best method must be chosen in order to maintain high cost benefit and short execution time.

The personnel requirements and their duties can be explained by the RACI matrix that is shown in the following table.

Tasks	Project Manager	Finance Manager	Marketing Manager	International Relations Manager	System Developer	Company CEO
Meeting management, organizational meetings and project meetings	A	A	I	C	I	R
Project schedule preparation based on the project scope and available time	R	I	C	A	I	I
Management of international marketing	A	A	A	R	C	A
Development of system for connecting company servers in different countries	I	A	I	I	R	I
Market Analysis and Service Management	A	A	R	C	A	C

Here, the letters R, A, C, I stand for Responsible, Assisted, Consulted and Informed respectively and hence, the matrix is called RACI matrix.

Amid the extensive periods of multinational marketing, the worldwide market changes are to be observed nearly and changes are to be made in the business framework appropriately. At the point when the headquarters in various nations are set up, the servers are associated together utilizing secure web association. After the servers are associated, steps are to be taken with a specific end goal to keep any accidents or significant blunders (Lock 2014). Once more, it must be guaranteed that the best nature of administrations is given to meet client requests. The organization ought to likewise alter and add more assortments of administrations to keep up market competitiveness. These means are fundamental with a specific end goal to keep any dangers that can have significant effect on the association.

The five main aspects of a project are collectively called SMART objectives where the letters stand for: S = Specific, M = Measurable, A = Achievable, R = Realistic and T = Timed.

Specific – The project must be specific in nature as far as goals i.e. the goals must be set in light of the project extension and it is to be guaranteed that the project objectives must be met toward the finish of the project.

Measurable – The project results must be measurable in light of the general extent of the project (Leach 2014). On the off chance that the results of the project are not inside the predefined scope, the project is said to be not quantifiable.

Achievable – The objectives of the project must be set to such an extent that they are sensibly achievable inside the accessible time limit and the general spending plan.

Realistic – The targets of the project must be sensible with the goal that they can be accomplished at the appointed time. Farfetched targets prompt to inadequate and fizzled extends and additionally loss of gigantic measure of assets.

Timed – Time is a basic piece of a project and care ought to be taken so that the project is finished inside an appropriate and particular course of events. On the off chance that the timetable is not kept up, it might be result in loss of immense measure of assets.

Cash flow budgeting technique is used for this project as the overall duration of project implementation is spread over a few years. This project deals with multinational marketing of the company, after which, the company also set up business headquarters in the countries. Hence, this project will take years for completion and the budget will be adjusted over different phases of the project. The budget adjustment will be based on the availability of cash and hence, the cash flow is the main factor behind the progress of the project. Hence, cash flow budgeting technique is used in this project.

Milestone 2 (Week 3)

The project budget and financial benefits are calculated in the attached excel sheet.

Forecast

Tangible Benefits
Category	In $US
Reduction of Expenditure	$          1,200,000.00
Reduction of Stakeholder Wages	$          1,000,000.00
Effective service benefits	$              50,000.00
Increased Sales benefits	$            250,000.00
Total Tangible Benefits	$          2,500,000.00
Tangible One-Time Costs
Category	In $US
International Marketing HQ Development Cost	$          1,000,000.00
Shipping Cost	$              30,500.00
Cargo Transportation Cost	$              30,000.00
Finished Goods Manufacturing Cost	$            115,000.00
Material and Equipment Cost	$            125,000.00
Other Cost	$              13,000.00
Total Tangible One-Time Costs	$          1,313,500.00
Tangible Recurring Costs
Category	In $US
Manufacturing Improvement Cost	$            250,000.00
Inventory and Storage Upgrade Cost	$              55,000.00
New Equipment Installation Cost	$              40,900.00
New software or hardware leases line cost	$              30,000.00
Material Cost	$              15,000.00
Total Tangible Recurring Costs	$            390,900.00

From the financial analysis, the return of investment is found to be approximately 5.2%.

Break Even Analysis
One-time and Recurring Costs	Year 1	Year 2	Year 3	Year 4	Year 5
International Marketing HQ Development Cost	$        550,000	$           –	$           –	$           –	$           –
Shipping Cost	$         35,500	$           –	$           –	$           –	$           –
Cargo Transportation Cost	$         30,000	$           –	$           –	$           –	$           –
Finished Goods Manufacturing Cost	$         75,000	$           –	$           –	$           –	$           –
Material and Equipment Cost	$         56,000	$           –	$           –	$           –	$           –
Other Cost	$           8,200	$     15,000	$     20,000	$     30,000	$     40,000
Manufacturing Improvement Cost	$        250,000	$   250,000	$   250,000	$   250,000	$   250,000
Inventory and Storage Upgrade Cost	$         55,000	$     55,000	$     55,000	$     55,000	$     55,000
New Equipment Installation Cost	$         40,900	$     40,900	$     40,900	$     40,900	$     40,900
New software or hardware leases line cost	$         30,000	$     30,000	$     30,000	$     30,000	$     30,000
Material Cost	$         15,000	$     15,000	$     15,000	$     15,000	$     15,000
Total Costs	$     1,145,600	$   405,900	$   410,900	$   420,900	$   430,900
Benefits and Advantages	Year 1	Year 2	Year 3	Year 4	Year 5
Reduction of Expenditure	$     1,200,000	$1,206,000	$1,212,030	$1,218,090	$1,224,181
Reduction of Stakeholder Wages	$     1,000,000	$1,005,000	$1,010,025	$1,015,075	$1,020,151
Effective service benefits	$         50,000	$     50,250	$     50,501	$     50,754	$     51,008
Increased Sales benefits	$        250,000	$   251,250	$   252,506	$   253,769	$   255,038
Total Recurring Costs	$        390,900	$2,512,500	$2,525,063	$2,537,688	$2,550,376

Payback

Payback Analysis (System Name)
Benefits of option	Year 1	Year 2	Year 3	Year 4	Year 5
Reduction of Expenditure	$ 1,200,000	$1,200,000	$1,200,000	$  1,200,000	$  1,200,000
Reduction of Stakeholder Wages	$ 1,000,000	$1,000,000	$1,000,000	$  1,000,000	$  1,000,000
Effective service benefits	$     50,000	$    50,000	$     50,000	$      50,000	$      50,000
Increased Sales benefits	$   250,000	$   250,000	$   250,000	$     250,000	$     250,000
Total Benefits	$ 2,500,000	$2,500,000	$2,500,000	$  2,500,000	$  2,500,000	$12,500,000
Costs of option	Year 1	Year 2	Year 3	Year 4	Year 5
Manufacturing Improvement Cost	$   250,000	$   250,000	$   250,000	$     250,000	$     250,000
Inventory and Storage Upgrade Cost	$     55,000	$    55,000	$     55,000	$      55,000	$      55,000
New Equipment Installation Cost	$     40,900	$    40,900	$     40,900	$      40,900	$      40,900
New software or hardware leases line cost	$     30,000	$    30,000	$     30,000	$      30,000	$      30,000
Material Cost	$     15,000	$    15,000	$     15,000	$      15,000	$      15,000
Total Costs	$   390,900	$   390,900	$   390,900	$     390,900	$     390,900	$  1,954,500
Net benefits/costs	$ 2,109,100	$2,109,100	$2,109,100	$  2,109,100	$  2,109,100
Cumulative benefits/costs	$ 2,109,100	$4,218,200	$6,327,300	$  8,436,400	$10,545,500
Break Even Period	2.31	Years

The non-financial benefits that the organization can gain from the multinational marketing are increase in global popularity, increasing size of the organization, more vacancies for new employees and positive changes in the services.

The Gantt Chart is based on the following project milestones.

Task Name	Duration	Start	Finish
International Marketing Development Project	82 days	Wed 15-03-17	Thu 06-07-17
Project Initiation	32 days	Wed 15-03-17	Thu 27-04-17
Identification of Stakeholder	5 days	Wed 15-03-17	Tue 21-03-17
Preparation of the Project Plan	4 days	Wed 22-03-17	Mon 27-03-17
Estimation of Overall Budget	7 days	Wed 22-03-17	Thu 30-03-17
Estimation of Timeline	7 days	Wed 22-03-17	Thu 30-03-17
Assessment of Project Risks	5 days	Fri 31-03-17	Thu 06-04-17
Analysis of Business Requirements	15 days	Fri 07-04-17	Thu 27-04-17
Project Planning	11 days	Fri 28-04-17	Fri 12-05-17
Allocation of duties to stakeholders	4 days	Fri 28-04-17	Wed 03-05-17
Project Scheduling	2 days	Fri 28-04-17	Mon 01-05-17
Management of business resources	3 days	Thu 04-05-17	Mon 08-05-17
Risk mitigation	4 days	Tue 09-05-17	Fri 12-05-17
Project Execution	12 days	Tue 09-05-17	Wed 24-05-17
Project control planning	12 days	Tue 09-05-17	Wed 24-05-17
Monitoring plan	10 days	Tue 09-05-17	Mon 22-05-17
Allocation of Budget	5 days	Tue 09-05-17	Mon 15-05-17
Project Implementation	34 days	Thu 04-05-17	Tue 20-06-17
Development process of International marketing	20 days	Thu 04-05-17	Wed 31-05-17
Material and goods supplier selection	12 days	Thu 04-05-17	Fri 19-05-17
Firms and Manufacturing plant construction	10 days	Thu 01-06-17	Wed 14-06-17
Market analysis	7 days	Mon 22-05-17	Tue 30-05-17
Equipment and material identification	15 days	Wed 31-05-17	Tue 20-06-17
Project Closure	12 days	Wed 21-06-17	Thu 06-07-17
Stakeholder sign-off	3 days	Wed 21-06-17	Fri 23-06-17
PIR reviewing	7 days	Mon 26-06-17	Tue 04-07-17
Project termination and hand over	2 days	Wed 05-07-17	Thu 06-07-17

Table 5: Gantt Chart

(Source: Created by Author)

The project will be controlled in light of the information that will be accumulated over the span of the project. At the point when the data available from the project evaluation is beneficial for the project, facilitate procedures will be taken in the project and in the inverse case, the project will be stalled or adjustments will be made on the project.

The chosen methodology for the project is waterfall methodology model. The system will comprise of collection and administration of essential and optional information and the last execution of the project in view of the data and information gathered. This can be led in the form of survey studies or polls and the essential information should be gathered from this examination. The secondary information will be gathered from the past records and insights of the market. The model is called waterfall because the steps will be conducted in a chronological order one after another. Waterfall model states that all the activities in a project are executed one by one and one after another within a suitable execution environment (Marcelino-Sádaba et al. 2014). This project deals with multinational marketing of the company, after which, the company also set up business headquarters in the countries. Hence, this project will take years for completion and the budget will be adjusted over different phases of the project. The budget adjustment will be based on the availability of cash and hence, the cash flow is the main factor behind the progress of the project. Hence, accordingly, the project duties will be executed phase by phase that is exactly the basis of the waterfall model.

The communication between every one of the related stakeholders of the project will be done in type of week by week group gatherings, telephone and video calls and in addition day by day reports in light of the progress of the project. The communication plan is as follows.

Stakeholder	Role	Communication Medium
Project Manager	Meeting management, organizational meetings and project meetings	Reports, Meetings
Finance Manager	Management of available funds and resources	Financial Reports
Marketing Manager	Market Analysis and Service Management	Meetings, emails, reports
International Relations Manager	Management of international marketing	Documentations, Forms and Fax
System Developer	Development of system for connecting company servers in different countries	Meetings, requirement discussion session
Company CEO	Management of all operations inside the company	Documented reports

After the project obligations of all stakeholders are finished, the project results will be contrasted and the preset goals and they are met, the project is ended and handed over to the project supervisor.

The project supervisor will review post project audit and will gather information from the underlying execution. On the off chance that the extricated information is not according to the plan, he will revive the project to roll out appropriate improvements. However, a project implementation methodology is to be followed for the review. For this project, qualitative review methodology is to be followed. The worldwide market changes are to be observed closely and changes are to be made in the business framework accordingly (Marcelino-Sádaba et al. 2014). In the IT setup, after the servers are associated, steps are to be taken to keep any accidents or significant errors. It must be guaranteed that the best nature of services is given to meet client requests. Again, the organization ought to change and add more assortments of administrations to keep up market intensity. In order to verify whether all these factors are properly implemented in the system, the quality of the project outcomes is to be checked. Hence, qualitative methodology is to be followed for the evaluation of the project.

Business Environment

Conclusion

In this task, a project plan has been designed for Amina Inc for the multinational showcasing arrangement. The association will encounter noteworthy changes in the business condition once it accesses worldwide market utilizing the proposed international marketing. The primary arranging period of the general project is troublesome on account of the broad size and extent of the project. In addition, the achievement of the project depends largely on the assessed budget related values and course of duties for completion of the project. Hence, the project plan is prepared recalling each one of these factors and what’s more keeping up most prominent accuracy in each one of the estimations. The company will encounter critical changes in the business condition once it accesses worldwide market utilizing overall promoting. The business condition can be influenced by two fundamental components – micro (interior) and macro (external). The micro variables incorporate monetary state of the organization, accessible technical support, labor and administrations. Moreover, macro components incorporate market changes, prevalence of the administrations of the organization, monetary changes in the market, accessibility of providers and others. Different scientists have outlined different models for sorting these small scale and large scale variables identified with the business condition of the organization.

In view of the project examination, the accompanying proposals can be recommended.

• The project must be specific with respect to targets i.e. the objectives must be set in light of the project augmentation and it is to be ensured that the project objectives must be met toward the complete of the project.
• The project comes about must be quantifiable in perspective of the general degree of the project. If the consequences of the project are not inside the predefined scope, the project is said to be not quantifiable and out of augmentation.
• The objectives of the project must be set to such a degree, to the point that they are sensibly achievable inside the available time oblige and the general spending arrangement.
• The objectives of the project must be sensible with the objective that they can be refined at the delegated time. Improbable targets provoke to divided and failed expands and furthermore loss of gigantic measure of advantages.
• Time is a principal bit of a project and care should be taken so that the project is done inside a sensible and specific course of occasions. If the course of occasions is not kept up, it may be result in loss of huge measure of advantages.

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