Project Management Assignment
Project Management Assignment
Group Members:
NAME:
ID NUMBER:
1. Laychale Yesgate
BER/1243/05
2. Mitiku Zerie
BER/1985/05
3. Kinfemichael Ashebir
BER/1313/05
4. Shambel Birhanu
BER/4589/05
5. Million Ademe
BER/2798/05
6. Kibreab Demissie
BER/2450/05
Submitted to:
Instructor, Fuad Mustefa
Jan, 2015
Table of Contents
Topics
Pages
ACRONOMS................................................................................................................................i
Acknowledgment..................................................................................................................ii
Executive Summary...........................................................................................................iii
1. Introduction........................................................................................................................1
1.1.Background of the project.........................................................................................1
1.2. Objectives of the project...........................................................................................2
1.3.Significance of the project.........................................................................................3
2. Market and demand analysis...................................................................................3
2.1 Market segmentation and targeting.......................................................................4
2.2. Service marketing mix/extended marketing mix.............................................6
2.3. Marketing plan...............................................................................................................9
3. Technical analysis.........................................................................................................16
3.1. The need for the project..........................................................................................16
3.2. Project design..............................................................................................................16
3.2.1. Location and Site Selection............................................................................16
3.2.2. Required material and facilities and design.............................................18
3.2.3. Feasible technology...........................................................................................21
3.2.4. Capacity.................................................................................................................22
3.3.Organizational structure and man power requirement................................23
3.4. Potential impact of the project on environment.............................................24
3.5. Social acceptability of the project........................................................................24
3.6. Potential Impact of the Project on Cross Cutting Issues..............................24
4. Financial analysis..........................................................................................................25
5. Economic Analysis........................................................................................................28
6. Assumption, uncertainty, and risk management strategy..................30
6.1. Considered assumption...........................................................................................30
6.2. Risk analysis.................................................................................................................31
6.3. Design risk mitigation strategy.............................................................................33
2
ACRONOMS
AAU-Addis Ababa University
WBS-Work Breakdown structure
SWOT-Strength, Weakness, Opportunities, and Threats
PESTEL- Political, Economical, Social, Technological, Environmental, and
Legal
SMART- Specific, Measurable, Attainable, Realistic, and Time Bound
Acknowledgment
First of all, we would like to thanks our instructor Mr. Fuad Mustefa, because
of he encourages us about what we must do in this course initiate us to be
hard worker on projects of different affairs that need modern management
and recommendation on appropriate issues. As a result we get some clues to
our future life that what we must do as management students.
Secondly, we would like to thank all interviewee who showed their
willingness to give the information that we required precisely and with full
cooperation.
Executive Summary
Ethiopian people attach great importance to eating. We can know it by the
saying Enjera is the staff of life. Ethiopias dishes highly stress on its color,
aroma, taste, shape and meaning. As a result, many Ethiopians come to
overseas and make their living by opening restaurants, which has become
the fundamental settlement in the world. Similarly, opening various styles of
restaurants in the domestic cities of the appropriate location is a great
business opportunity. Based on this, a great business opportunity is to open a
fast-food delivery, named Betoch Fast Food delivery, in Addis Ababa City.
1. Introduction
The fast food making and delivery service has emerged because the
characteristics of our contemporary society demand the development of new
methods of management of the many forces involved, three are the
following:( 1) the exponential expansion of human knowledge;(2) the
growing demand for a broad range of complex, sophisticated, customized
goods and services; and (3) the evolution of worldwide competitive markets
for the markets, for the production and consumption of goods and services.
All three forces combine to mandate the use of teams to solve problems
that used to be solvable by individuals. First, the expansion of knowledge
allows an increasing number of academic disciplines to be used in solving
problems associated with the development, production, and distribution of
fast food delivery and services. Second, satisfying the continuing demand for
more complex and customized products and services depends on our ability
to make product design an integrated and inherent part of our production
and distribution systems. Third, worldwide market forces us to include
cultural and environmental differences in our managerial decisions about
what, where, when, and how to produce and distribute our food.
To be successful, the transition must be systematic, but it tends to be
slow and tortuous for most enterprises. Another important societal force is
the intense competition among institutions, both profit and not-for profit,
fostered by our economic system resulting in organizational total quality
control. Responses must come faster, decisions must be made sooner, and
results must be occurring more quickly.
1.1.
The project that we propose and apply to the future is to avoid the doubt in
hotels and different restaurant services. Because as we interviewed some
peoples from different sectors and areas they have many doubt of food
1
services in hotels and restaurant quality food and fast service to them. So,
hopefully we think we are avoiding such ambiguities of customers in our
project as can as possible.
When the project we under takes are large and getting larger, our projects
increase in size and complexity because the more we can do, the more we
try to do. We try to command the most public attention tends to be large,
complex, multidisciplinary endeavors to our project.
Vision
-
Being one of the pioneers best companies in delivering food in Ethiopia, able
Mission
-
value;
We offer quality, service and cleanliness to our customers;
We are strongly committed to our people;
We aspire to be the recognized leader in the food delivery, committed
to build healthy and safety food service across the Addis Ababa.
1.3.
the
niches
gains
certain
economies
through
specialization; and the niche has size, profit and growth potential.
3. Local marketing: Target
ii.
iii.
segmentation
included
are:-
benefit
desired,
Market targeting
It is the process of selecting one or more market segments to enter.
Customer Profiles
The majority of customers of our fast-food delivery are unmarried
employees, university students, and nearby residents of almost all ages.
Students from AAU, who occupy the 35% of the amount.
Unmarried workers from Addis Ababa city, who account for 40% of the
amount.
The rest 25% is nearby residents.
Focus Groups
To get a clearer idea of the views and points of the customers, five focus
groups were organized. The focus groups were as follows:
5
3
4
3
5
advertising,
construction
and
engineering,
insurance,
legal
average fee collected per delivery is $7, then the business would need
to make 4,286 deliveries each year to remain profitable. With only 235
working days in a year, the business would have to make more than 18
deliveries a day.
5. Determine the business' ability to attract sufficient customers at the
price point calculated in step 3 to make the needed daily quota
determined in step 4. In the early stages of a business, you may be
able to attract new customers with a fee structure that is slightly lower
than the competitors'.
6. Set the pricing strategy by balancing the market research with the
operating costs to reach a price that makes your service appealing
without causing it to go broke. Adjustments to the pricing strategy can
be made in the future as you find out about additional costs and
growth opportunities.
distributions.
Market entry strategy
Regarding market entry strategies, service firms unique characteristics (for
example,
low
capital
intensity
and
inseparability
of
production
and
Executive summary
The opening section of the marketing plan that presents a short summary of
the main goals and recommendations to be presented in the plan.
The marketing plan outlines an approach to attaining a significant increase
in our service delivery sales and profits. The sales target in our service
delivery is Birr 2,254,500, we think these target is attainable because of the
improved economic, competitive, and distribution picture. The target
operating margins before tax in our service delivery is Birr 650,985. To
10
achieve these goals, the service advertising budget will be Birr 15,000.
Current market situation
The first major section of the plan describes the target market and our
service position in it. In current marketing situation, the planer provides
information about the market, product performance, competition and
distribution is includes a market description that defines the market, includes
major market segments. The planner shows market size, in total and by
segment for the past several years, and then review, customer need and
factors in marketing environment that may affect customer purchasing. Next,
the product review shows sales, prices, and gross margins of the major
products in product line. A section on composition identifies major
competitors, and discusses each of their strategies for product quality,
pricing, distribution and promotion.
Purpose/mission
and
profitable,
because
there
are
appropriate
crowds
of
Situational analysis
o SWOT Analysis
Strengths
Threats
12
SMART Analysis
To achieve a performance of the business, SMART report is very essential
in the planning of a project. SMART stands for specific, measurable,
attainable, realistic and time-bound. SMART analysis of our project is as
follows.
Specific The target of running the Betoch Fast-Food delivery is to offer
good quality diet and takeout service with the lower price and the relieved
food. We are not only doing a business with our customer, but also we make
friends with them. We must treat our customers with honesty. Of course, the
ultimate purpose is to make profit in business.
Measurable our restaurant is located in Addis Ababa district, and will
offer various services to customers, such as ordering a meal, takeaway,
15
online delivery, and so on. We profit 25,000 birr average every day.
Agreed According to my experience and survey, the unmarred, students
and workers want to obtain more convenient and affordable meals, so our
delivery service is to cater for such demand. With the increasing reputation,
more services will be provided and better services will be supplied.
Time-bound Choosing a right place for Betoch Fast-Food delivery service would be
completed in Addis Ababa District in the first days of June. From the second day of
June, it takes me five days to sign a contract of renting house, and another five days
to apply for the business license. And from the third ten days of June, there would
be over 20 days to finish the decorations, shelves, furniture and equipments. Then it
is time to purchase the basic stock. betoch Fast-Food Restaurant will be opening
grandly on July 26th, 2012.
3. Technical analysis
3.1. The need for the project
The most and available things that encourage us to lay out this project is to
avoid different customers doubt and ambiguity with different hotels and
restaurants. And also to save the time delay to eat from house to site of the
hotels and during events, it is best to for employees that work full time
within week that, we prepare accordingly their orders with best quality and
quick services.
17
18
All equipment installation will be evaluated using the manual for food
service equipment, as well as health district regulatory requirements.
19
Water
wash
must
be
made
to
preclude
the
possibility
of
21
House: is that uses for our project is not that much very decorated and not
have any second floor but, it must be to some extent wider with surrounding
promote or advert our brand name as well as functions what we are perform.
Car: as we are delivering the food by carrying to each customer homes. We
must have to use a car to deliver quickly and just in time, not only but also
we need a car for supplying different raw materials to prepare the foods.
size
shape
shelf life
weight
sensory characteristics (taste, texture, appearance, etc)
costs
ingredients (with quantities)
equipment
Food development
Foods are developed in a number of stages. They need to be tested and
evaluated throughout these stages to ensure they are meeting requirements.
Brief
The first stage of food development is the brief, which is the problem that
needs to be solved. For example, developing a lasagne for health conscious
consumers.
Market research
Market research means finding out information about what people want from
a product. It includes studying market trends and shopping habits. This can
be done by conducting surveys, questionnaires, and telephone interviews.
For example, would people buy a low fat lasagne?
3.2.4. Capacity
Plant capacity is the volume or number of unit that can be produced during a
given period. The capacities that we need to use are investment cost and
market condition:
Investment cost is not affect our project, it depends on the market
conditions because the government are initiate and encouraged the
investors that give service to the society, so he supports financially and give
different incentives according to our project objectives and goals that we
contribute to the society as well as the country at all. Hence, the man power
in our market is cheaper and mostly available, so we can get them easily and
23
sufficiently.
Market condition: Here, we are reminding that the world is globalized and
the market conditions are fluctuating daily, we try to balance and stabilized
our cost accordingly with the market inflation and customer demands to our
food delivery service.
Normal capacity
Type
Cooker
No.
6
capacity
40
daily
240
monthly
7,200
yearly
86,400
Actual capacity
Type
Customer
Average
Average
meal
customer
No.
65
daily
monthly
yearly
130
3,900
46,800
Special event
Total
3,300
50,100
Manager
Accountant
Security and
compound supervisor
Janitor
Purchaser
24
Sheaf
.
Cooker
Deliverer
many reasons with quality service we think we are being acceptable with the
different social affairs within the country. After the questionnaire survey, we
conclude, almost 90% people are interested in our delivery service, and the
85% people are willing to use to our service, also hope we can provide the
membership to them for future use.
4. Financial analysis
We will loan birr400,000 from Dashin Bank at 8% interest. We expect to
pay off the debt totally 432,000 within one year.
Rental cost: The house rent would cost birr60,000 in totals to rent each year.
Equipment: The cost of equipment in the food delivery service would be birr
224,100
26
Car
170,000
Computer:
15,000
Refrigerator
Ventilator
5,000
1,500
Telephone
600
birr1,464,500
Wages
252,000
Utilities
2,600
2,000
Telephone charge
2,000
Raw material
1,202,400
Other expense
3500
224,100
SUB-TOTAL
224,100
60,000
Operating budget
SUB-TOTAL
1,461,000
1,521,000
Public relations
Market research
Contingency allowance
Loan interest:
5% yearly profit
400,000*8%=32,000
TOTAL COST
432,000
28
Asset
on
Liabilit
y
Cash
Acc.
Equipm
Supply
Receiva
ent
on hand
Owner
+ equity
ble
1.
2.
3.
4.
40000
40000
0
-60000
0
-60000
192085
1202400
192085
120240
0
5.
6.
-15000
22545
-15000
2254500
7.
00
-
-252000
25200
0
-2600
-
40000
40000
0
10.
0
-32000
11.
-7500
8.
9.
-2600
-32000
-7500
12.
-1202400
120240
Total
18854
00
0
192,05 0
8
2,077,48
5
29
252,000
Advertising expense
15,000
Rent expense
60,000
Interest expense
32,000
Depreciation expense
32,015
Raw material
1,202,400
Utility expense
2,600
Miscellaneous expense
7,500
Total expense:
1,603,515
Net income before tax
=650,985
5.Economic Analysis
The study of forces that determine the distribution of scarce resources. It
provides insight in to how markets operate and offers methods for
attempting to predict future behavior in response to events, trends, and
cycles.
Types of economic analysis
1. Cost analysis: provides a complete accounting of the expenses related
to a given policy or program decision. It supply the most basic cost
30
information that both decision maker and practitioners require and forms the
foundation of all other economic analysis.
Direct cost: - like equipment and fringe benefits, in addition to staff salaries.
Indirect costs or overhead: - such as control support services, human
resource.
Future cost: - include wage increases, contributions for increasing pension
and insurance expenses, and other escalating costs.
Capital costs: -including debt service, contingency, professional service.
2. Fiscal impact analysis: is a comprehensive study of all governmental
revenues, expenditures, and savings that will results from the proposed
policy or program. This type of analysis helps policy makers determine
whether a proposed initiative is affordable from a budgetary stand point.
3. Cost-effective analysis: a fiscal impact analysis can help us asses how a
program or policy will affect our budget but it wont tell us whether the
program or policy is an efficient use of resources. To evaluate which program
or policy creates the result we want at the lowest cost, use cost effectiveness
analysis (CEA).
4. Cost benefit analysis (CBA): is a method for comparing the economic
pros and cons of policies and programs to help policy makers identify the
best or most valuable options to pursue.
Note:- Among the four types of economic analysis, CBA is the most
comprehensive. However, it is not always necessary or advisable to conduct
CBA of an intervention, as cost benefit analysis can be difficult and time
consuming to perform.
Type of economic analysis
Cost analysis
Fiscal impact analysis
Information provided
How much
How your budget will be affected
31
Cost-effectiveness analysis
dollar or birr
How much benefits
out
weight
costs
Food policy: is the area of public policy concerning how food is produced,
processed, distributed and purchased. It designed to influence the operations
of the food and agriculture system. This often includes decision making
around production and processing techniques, marketing, availability,
utilization and consumption of food in the interest of meeting or furthering
social objectives.
In our project we have three main objectives for food policy:1. To protect the poor from crisis,
2. To develop long run markets that enhance efficient resources use, and
3. To increase food production that will in turn promote an increase in
income.
Economic analysis guidelines are important for:
1. They assist policy methods in developing regulations that achieve the
highest environmental quality and human health standard at the
lowest costs;
2. Provide analysts with information;
3. Develop an overarching framework for economic analysis;
4. Ensures that important subjects such as uncertainty, timing and
valuation of costs and benefits.
deems he is able to control and manage them. Now, he has thought of tree
measures which are as follows:
Try to avoid the risks, for example, make sure the new staffs could accept the
monthly wage in the interviewing
Carry out market research among target customers to improve the popularity
and the diversity of the.
Monitor the lead time to make sure the materials arrive on time.
Set aside a certain percentage of the total budget as contingency allowance
to take account of the unexpected risk.
Public relations
Market research
projects, as well as many environments in which the project exist. The most
Common method of risk identification is the following
uncertainty.
Typically, we try to reduce such uncertainty by the preparation of and pro
forma documents. Pro forma profit and loss statements and breakeven charts
are examples of such documents. The results, however, are not very
satisfactory unless the amount uncertainty is reflected in the data that going
36
to documents.
Note that; pro forma projected or anticipated, usually applied to financial
data such as balance sheet and income statement.
For example; Types of risk and handling strategy
Financial risk: up-front funding and payback period based upon number of
planes sold.
Risk handling strategy: - funding by life-cycle phase
-continuous financial risk management
-sharing risks with sub contractors
-risk reevaluation based on sales commitments
Market risk: -forecasting customers expectations on cost, configuration, and
amenities based up on a 5-10 year life of a plan.
Risk handling strategy: -Close customer contact and input
-Willingness to custom design per customer
-Develop a base line design that allows for
customization
37
38
The first major step in the planning of process, after project requirements
definition is the development of the WBS. The WBS is structured in
accordance with the way the work will be performed and reflects the way in
which project costs and data will be summarized and eventually reported.
Preparation of WBS also considers other areas that require structured data,
such as scheduling, configuration management, contract funding, and
technical performance parameters. The WBS in the single most important
element because it provides a common frame work from which:
The total program can be described as summation of sub divided
elements.
Planning can be performed.
Costs and budgets can be established.
Time, cost and performance can be tracked.
Schedules and status reporting procedures can be established.
Network construction and control planning can be initiated
The WBS acts as a vehicle for breaking the work down into smaller elements,
thus providing a greater probability that every major and minor activities will
be accounted for.
In setting up the work breakdown structure, task should?
Have clearly defined start and end date
Be usable as a communication tool in which results can be compared with
expectation.
Be estimated on a total time duration, not when the task must start or end.
Be structured so that a minimum of project office control and documentation
(that is forms) is necessary.
Validate time and scheduleApproving total risk and impact of decision making
Work packages
WBS
KGN[
7.3.
Project
monitoring,
evaluation
and
reporting
mechanism
Project monitoring: the first step in setting up in any monitoring system is to
identify the key factors to be controlled. Clearly, the project managements
wants to monitor performance, cost, and time but must define precisely
which specific characteristics of performance, cost, and time should be
controlled and then establish exact boundaries with in which control should
be maintained. For example, the number of labor hours used, the number or
extent of engineering changes, the levels of customer satisfaction and
similar items may be worthy on our project. Monitoring of livelihoods
41
Narrative
verifiable
summary
indicators
To improve quality in
Goal or
Staffs and
aim
customer demands
students
opinion
Purpos
1.
e or
services
To
increase
revenues
objecti
ve
Opinion survey
two years after
project
implementation
and
profit
of the Betoch
premises will
figures
Fast-Food
be raised after
delivery
one year
20%
and
30
within 2 years..
profile
and risk
by
raise
information
Financial record
profits
To
Assumptions
Revenue
respectively
2.
Source of
Increased
the
number of
and
customers
improve
42
competitiveness
of
the
Betoch
Fast-Food
delivery.
1.The new
1.Larger premises
Output
s
to
customers
Existence of
new site
providing
more
information
support and
in regular
service.
Activiti
1.Negotiate
es
rental
the a
of
premises
2.Sign
certain
percentage
contract of the total
as
contingency
Observation
delivery service
records
staff members
are competent
and honest
2.The advice
on developing
new dishes is
Project
implementation
diary
correct
1. There are no
interruptions
and delays to
the remodel of
the shop.
2.
The
contractor
business
uses
from
license take
Industrialand account
Commercial Bureau
4.
Apply
for
of
the
materials.
tax unexpected
Order
equipments,
furniture
materials.
quality
2.Try
to
new avoid
the
risks,
for
new example,
make
sure
and the
new
staffs could
43
good
accept
7.
Make
the
regulation system of
employee
8.
Decide
on
the
training
new staff
11.
Order
new
materials based on
the decision made
before.
12.
Get
the
equipment
furniture
new
and
delivered
and installed.
13.
Get
materials
the
monthly
wage in the
interviewing
3.Carry out
Market
research
among
channel details.
10.
the
new
delivered
target
customers
to
improve
the
popularity
and
the
diversity
of
the
services.
4.
Monitor
the
lead
time
to
make
sure
the
materials
arrive
on
time.
Human
Inputs
Equipment
Dining
Supplies:
Telephone
44
Financial
Birr 400,000
as a loan from
be willing to
the Dashin
Bank
constraints with some drinks, like milk, tej, and food like bones and tendons
of oxen that is mixed with siggawott. And also as we ask none of them are
not have menu to their meal, they it. What they act all the time, averagely
most peoples want to it more than 60 Birr per day for their daily meal.
Now, our recommendation according to our observation and responses
gotten from customers is to improve the problem listed above with quality,
quick service, full information and also as possible as we try to develop menu
to their meal according to their needs and wants. Finally, plan to be one of
the well-known food deliverer in Addis Ababa and expand to regional towns.
46
8. Conclusion
Hence, we strongly deem our delivery is able to provide adequate quality
of diets and high-class service to customers. More important, we uphold the
concept of good reputation is the life of business. We have full confidence
that we will win the favor of the customers.
There is no decent fast-food delivery around here. A well-equipped fastfood delivery like ours would attract customers around this area. This plan is
finished after detailed survey and careful consideration. We are sure that it
will be implemented smoothly and it will be a big success. The plan is
reliable, practicable and considerable.
We would like to meet with you at any time this week to discuss this plan and
to be glad to explain the plan in details or to offer any additional information
that you may need.
Reference
Harold Kerzner, phD, project management,5th Edition
Internet
Jack R.Meredith Samuel J. mantel. JR, 3rd Edition and 7thEdition
The primer, John Wiley and sons, Global sensitivity analysis
Principle of marketing, kotler 7th edition
47
Appendixes
The analysis of the business
The Betoch Fast-Food delivery is located between the Megenagna and
Karamara District. In this area, there are many students and workers, who
want to have considerable meals, though there is no decent fast-food
delivery around here.
There are many hotels which focus on the rich man, and they ignore
most of the working class and students. So our fast-food delivery has
enormous business opportunities.
However, our new fast-food delivery is a new service and lock of reputation,
we can draw the new customer's attention in reasonable price, good quality,
and after-sales service, and we can try my best to create a good relationship
as soon as possible.
Questions
1. How often do you visit the fast-food delivery?
2. How do you know the Betoch Fast-Food delivery, by web site, from best
friend, from booklet?
3. What do you think of the prices the fast-food delivery offers?
4. How do you feel each time you visit this delivery?
5. What do you think of the quality of diets the fast-food delivery offers?
6. What do you think of takeaway services if you once have bought?
7. Which kinds of diets in this fast-food delivery is your most favour?
8. What most often disappoints you when you come to the delivery?
9. Do you think the delivery assistants are helpful for you?
10.What additional services would you like to see?
11.Do you have any suggestion to advice?
12.Do you have a menu for your meal?
Complaints
They have few choices when considering buying some their favorites.
The fast-food delivery is not fast enough, when there are lots of people.
1