Project Management Assignment 2
Group 4:
Names:
Jayce Arib (100828449)
Dev Patel (100828640)
Sebastian Anderson (100717369)
Chris Polak (100823707)
Practice Health Check Project Name/title
Practice Health Check aiming to update and rework its financial processes and business plan.
Problem statement
Reports from Team members stated that Practice Health Check’s current financial processes and
business plan are outdated, complicated, and inefficient. To maintain the company’s financial
stability and growth opportunities, this needs to be looked at, reworked, updated and improved
upon.
Project Goals and Objectives (Dev)
There are multiple goals and objectives of PHC's project which include improved
financial sustainability, data-driven decision-making, improved compliance & better quality, and
Risk management with financial portfolio diversification etc. There are a number of important
goals in the project but according to the project description, improved financial sustainability is
one of the primary goals. The company is looking to accomplish this goal by optimizing its
financial systems and its methods. The company wants to develop a strong financial business
plan that will allow the company to predict future sales, project income, and determine possible
risks as well as opportunities associated with it. The company believes that after implementing
those changes they will be able to make better decisions, assign resources effectively, and
provide a long-term viability of the company.
The second goal of the project is to implement data-driven decision-making and risk
management with financial portfolio diversification. PHC plans to achieve this goal by making a
statistical reversal model that predicts customer spending habits which will allow the company to
tailor its services and marketing techniques more accurately. Talking about risk management
goals, the company aims to improve PHC's risk management processes and optimize its
important investment decisions. It is very likely that PHC can expand its financial portfolio
intelligently and may increase profitability while reducing its possible losses because of the risk
factors associated with financial tools and industry-specific futures. Further, by studying onward
contracts and industry-specific futures, the company believes that it can make educated financial
decisions that will minimize risks, maximize returns, and transform PHC's financial processes to
achieve greater efficiency and effectiveness which will end up putting PHC in a better financial
situation.
The next big goal of the project is to improve compliance & better quality of the service.
With financial improvements of the company, in addition, they also aim to improve PHC's main
services, which are around infection management consulting and audits. Basically, they want to
align their company plans to financial operations with public health, legislative, and
organizational requirements so they can improve their education, training, and program
development offers. The company claims that by making those improvements it can maintain
and improve its reputation for providing effective infection control and environmental services
solutions, which will end up creating safer environments for the clients in the medical, dental,
and non-healthcare services that they provide.
In summary, overall, this project set a massive goal to improve PHC's financial strategies
to increase efficiency and effectiveness. By implementing, improved financial sustainability and
compliance, data-driven decision-making and risk management with better quality of service,
PHC is looking to improve its financial decision-making abilities and provide its continued
success in providing infection control consulting services across Canada.
Project Requirements (Jayce)
Practice Health Check aims to update and rework its financial processes and business
plan since its current financial processes and business plan are outdated, complicated, and
inefficient wherein, employees/team members are having a hard time gathering and
implementing data. The project requirements that Practice Health Check should focus on are the
following:
Conducting a comprehensive analysis of current financial processes
Conducting a comprehensive analysis of the current financial processes is one of the key
requirements that need to be prioritized by Practice Health Check. There are many ways to
conduct analysis and financial processes. This can be done through a Balance sheet wherein, “it
provides details on an organization’s assets, liabilities and equities for a reporting period, such as
monthly, quarterly or annually”(Schwark, 2022, para. 3). Another concept of what Practice
Health Check could do In terms of conducting a comprehensive analysis of current financial
processes is initiating a SCRUM meeting wherein, team members will be having a quick yet
detailed meeting to discuss about the tasks that each team members have done, and what is yet to
be done. Team members could also discuss some obstacles and constraints that are holding them
back.
Performing a break-even analysis
Performing a break-even analysis could also enhance Practice Health Check’s financial
process and business plan so that they could get accurate results in terms of statistical data which
mostly are numbers. A Break-Even Analysis is a formula used in project management or
business in general wherein it calculates the costs of a new business, service or product and
divides it by the unit sell price to find out the result and will break even (Ali, 2022, para. 3). With
Practice Health Check performing a break-even analysis, the company will mostly be successful
in processing their projects.
Developing statistical models for sales forecasting and income projections
Developing statistical models for sales forecasting and income projections could also be
one main key project requirement that Practice Health Check should also consider. There are
many ways that the company can process their project through the use of statistical models for
sales forecasting and income projections. The company could use a Regression Analysis
wherein, The company will use historical data (this could be sales, company’s growth
percentage, etc.) and linear regression techniques take into account that this method should
consider some factors like market conditions, customer sentiment, economic trends, consumer
behaviour, company’s competition, etc (More, 2023, para. 6).
Project Deliverables (Sebastian)
Break-even analysis
Break even analysis is an important deliverable or Practice Health Check Corp in their
new financial and business plan, According to NetSuite.com. (2022, September 14). How to
calculate your break-even point. Oracle NetSuite (“What is break-even analysis”), A break-even
analysis is effectively a budget where in this case the company factors in how much money they
need to make before they make 0 dollars. It’s very similar to a 0 balance budget an individual
might make but on a much larger scale to facilitate the company’s various costs. For this project,
this should contain not just the costs associated with this project but the costs associated with the
entire company from CEO income to the price of erasers. These sorts of budgets can be very
powerful tools to determine the true money that a company has and to make sure that every
department has a large enough budget to do the jobs they need to and in the context of the project
that is what is going to allow for the company to mobilize much faster.
Estimate Contract Futures
It’s important for Practice Health Check Corp to predict the contracts and sorts of work
they can expect in a given year. Using the data from the past work the company has done over
the years Practice Health Check should have the ability to build a realistic idea of what volume
of work they can expect each year. As part of this project, it’s important to build a system that
can use this data to create accurate and effective models that are capable of predicting these
trends factoring in for things like expected company growth. This software should have the
ability as well to have expected jumps in company involvement for example during COVID, the
number of customers would likely jump a significant amount. This will drastically help the
company to use the Break-Even analysis talked about before to decide how much each
department actually needs in the budget to be successful and find areas that are possibly
overfunded.
Financial Predication
Our team needs to be able to develop a tool that is able to predict the expected earnings of
Practice Health Checks so that the company can better plan based on its expected future success.
This information could be collected using the previous deliverables to take the clients' previous
contracts and average the profit per contract then apply that to the expected number of contracts
to generate an expected income in the future. This would never be an exact number by any
measure but would allow the company to make informed decisions about their financial future.
The tool should also be able to factor in their expenses and projected expenses and subtract that
from the total expected profit of the company. Lastly, this tool should be able to factor in
inflation as our society is experiencing fairly rapid inflation. It would be relevant to factor in the
expected inflation by the end of the year and how that might affect people's ability to purchase
and from that, the income earned by the company.
Risk Assessment Tool
For any company, it’s incredibly important to be able to identify various risks and for
Practice Health Check Corp, that is no different. Using the three deliverables mentioned before
our team needs to create a final tool that is able to combine an estimate of future contracts, future
income and current break-even budget to determine the actual risk of different ideas to the
business at hand. The tool should be able to take data like the expected cost of the idea, expected
increase in the customer base and produce results that show how risky the idea is and how long
financially it would take to recover if the idea failed entirely. This would allow the company to
have a stronger understanding of the financial loss to ideas if their future plans don’t work and
help the business find ways to do risky ideas in a more financially safe way.
Project Exclusions (Chris)
Practice Health Check’s project scope does not include the following:
Analysis of individual client spending or budget
The first major exclusion which is not included within the scope of the project is, any
analysis of individual client spending or budget. The goal of the project is to help ensure the
future financial success of the company, and in general, to look forward to the future of the
company. As such, we wish to be able to create a broad model to predict things like customer
spending. The goal is not to analyze a particular client's spending for past years, but instead to
create a model that can be applied to projecting sales for future years. Including this within the
scope of the project would be detrimental to the project as focusing on each individual client
would take a large amount of time and resources and would not further the goal of the project
instead, hindering it which would be detrimental to the company and would do very little to
assist the clients.
Analysis of any client’s infection control is not being conducted
The second exclusion from the scope of the project that is noteworthy is that within this
project, no analysis of any client's infection control is being conducted. This project looks at the
financial side of the company. While some analysis of future trends in infections may be required
to forecast customer spending when creating the model that will be used to predict it, there will
not be any analysis of any companies infectious disease procedures and prevention. This task is
instead a part of other projects, which are being done as consulting for the individual clients
consulting us. As such, including this in the scope of the project would not only keep us from
focusing on the important parts of the project, but also would step on the toes of other teams,
which would be counterproductive to the goal of the project, and stepping on the toes of other
teams, could hinder them and be detrimental to both us as a company and to the clients.
Cost Estimates (Dev)
There are a number of factors that play a crucial role in PHC's cost estimates. Since the
project is about improving the financial systems and processes with developing a new financial
business plan to increase Ravens’ company may need to hire more employees, provide better
equipment to staff and add or upgrade high-performance IT resources.
One of the main costs for this project is labour costs. The labour cost depends on the
number of employees, the roles within the company and the desired wages or hourly rates of the
province or country. PHC's project plan and its set goals and objectives, we can estimate that the
company needs at least 6 to 7 new employees. Let's assume that PHC is only interested in hiring
in Ontario, then according to the source, the average healthcare consulting company pays
entry-level employees around $25 to $30/hour which is around $51,430 to $57,720/year
(ZipRecruiter, 2023). And the number can go hire as infusion hits. On top of that Canada also
mandates having workers' compensation insurance and the average businesses pay about $45 per
month or $ 542 per year for workers' compensation insurance (insureon, 2023). And since PHC
is interested in hiring about seven employees the number hits around $3,794/year and other
standard employer benefits like medical, vision, dental, life, AD&D (Accident Death &
Dismemberment), and disability cost almost $5,000 to $7,000 per year (Jacquie Fritsch, 2023).
So, the average cost of workers' compensation insurance and employee insurance of the business,
ends up somewhere around $8,800 to $10,000 per year plus their yearly salary so looking at
around $60,230/year minimum per employee and for seven people $421,610/year.
Following up with cost estimates, the second biggest factor is equipment cost for the
staff. Since the PHC is already a well-established company, they may have sufficient equipment
for the old staff members but not for the newly hired employees. The project plan revolves
around improving, developing and analyzing business plans so it does not involve any
professional tech-related things like high-performance servers, routers, and switches instead they
need an open office area, desks, chairs and a few monitors, PCS or laptops depending on who
requires what. The PHC work with partners across Canada, so we can assume that it is a middle
to large-level company and those level of company usually have enough office area to fit at least
ten more people comfortably. If the company is too nice with newly hired juniors, they may give
them new desks and chairs. Usually, simple desks without many features can cost from $100 to
$400 and chairs between $50 to $150 (autonomous, 2023). Next are monitors, PCS or laptops
which are based on who requires what condition. If we assume all seven people require all of
them then a standard 27-inch Dell monitor costs roughly $150 and average Dell Latitude
office-use PCs and laptops cost around $1200 to $1500 (Dell Canada, 2023). And lastly, normal
office stationery like sticky paper, pens, markers and other required stationary with security
software and other office use software like Microsoft 365 may end up in $500 to $700. So, the
average cost for seven people comes up to $11,550 to $14,650 and 95% of the equipment is a
one-time investment.
After labour and equipment costs, the next is the resources cost for the newly hired
employees. There are a number of resource costs which include IT infrastructure upgrades to
support the increased number of employees, travel expenses for training or in-person client visits
for discussion, training materials and programs and utility costs like electricity, water, heating
and cooling. Well-established companies like PHC will already have powerful servers and decent
internet access to manage day-to-day tasks in the company. Adding seven more people to the
company will not make a significant impact on server stress and as well as internet traffic. Since
the job description of those new juniors is to improve and develop the business plan, the impact
on servers will be minimal. Every internet provides charges based on so many factors but the
average Bell internet plan costs somewhere around $49.95 a month to $149.95 a month
(Planhub, 2021). But we can attach this cost to new employees' resource costs cause everyone in
the company also uses the Internet as well. Travelling is something that only one or two can
require. Based on their job description they may have to meet with clients or business partners in
various locations, attend industry seminars, etc... Travelling experience is unpredictable,
sometimes employees must travel once or twice a month and sometimes every week, so the cost
changes every month. Let's assume that employees have to travel within 50 km so if the
company books an UberX which is affordable, it costs around $80 and an additional $4.50 fee
which is around $85 a ride on one side and two sides cost $170(uber, 2023). Since the travelling
is unpredictable, we cannot get the exact cost, on the other hand, if the work can be done without
travel, then expenses may not be required.
Since those seven employees are newly hired, they may require simple training, but
training materials and program costs are a one-time investment, once the employee completes the
training, they are not required to do it again. If their job description requires to have training on
new topics, then the cost may increase. Most of the company make their own training videos and
assignments which can be easily done by AI in today's world (hourone.ai, 2023). Usually, those
websites' business accounts cost somewhere around $95/month and provide 180 Video Minutes
Per Year, which is more than enough for a company like PHC (G2, 2023). Utility costs are
something that we can not calculate just for seven people. Utilities like electricity, water, heating
and cooling are something that everyone in the building will use. The average cost of utilities in
a commercial building is somewhere around $2.14 per square foot (blog. constellation, 2021). if
we assume that PHC has around 100 people in the office with a mix of cubicles, private offices,
and open space, it will average require almost 150 to 250 square feet per employee
(branchfurniture) which will require 15000 square feet of office and the average utility costs will
end up at $32,100 for 100 employees. But we can attach this cost to new employee's resource
costs cause everyone in the company will also use the office space. After reviewing all the costs
associated with new hires, we estimate that the cost can go somewhere around $435,160 to
$438,260 per year.
Cost Estimates Approaches
For the cost estimation of PHC's project, I used bottom-up methods which is just
estimating each item or task and adding them together. At first, I start by listing all the cost
factors and their needs and their correct price estimates and at the end I add them to make a final
figure.
Helpful information that leads to making these Cost Estimates
To make accurate cost estimates we need a number of things which include financial data,
market research, price quotes from suppliers, and HR data. Financial data is important because
the company needs to how many people, they can comfortably afford based on the equipment
they require, their salary ranges, benefits, etc. Market research is important to understand the
current pricing in the industry for a particular product or service, it can help to decisions about
cost estimates, and it provides an overall view of the market. Quotes from suppliers are similar to
market research but the price estimates are formal and provided by separate suppliers or agents
for specific products or services. HR provides the required information to fund labour costs,
assess workforce requirements, etc.
Important people/groups that we can discuss these Cost Estimates with
There are so many people involved in the project and its funding, therefore there are a
number of people who can be considered as important to discuss like the management team,
finance officers, HR, all department heads and board of directors, etc... the management team is
the main key because they are the one who is responsible for approving budgets and financial
decisions so the cost estimates match with the company's goals and strategy. finance officers can
provide better advice in creating and analyzing a cost estimate for the project. HR can provide
labour-related cost estimates, including wages, benefits, and needs. all department heads should
be involved because they provide insights into each specific department's cost and resource
needs. And finally, the board of directors can review and approve funding and cost estimates.
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