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Maximizing stakeholder benefits

The paper mainly reflects on the organization "Workrite" that helps in providing electronic components to anyone who mainly wishes to purchase from them. Presently, the company is experiencing challenges in gaining new customers. In order to resolve this issue, Robbin, who was the managing director of the organization, came up with a radical option that mainly focuses on research and enquiries that suggests Lock-in is the best idea for the refurbishment of companies. Robin wants to develop a new system for handling the operations of the company quite well. The internet-based system is mainly needed by the organization so that Robbin can have proper access to the system even when staying away from the business. Additionally, the new system will also provide an opportunity to increase the level of responsibility of the admin staff.

The stakeholders who will be got impacted by the Lock-in project are mainly reflected in the below quadrant with proper description.

Stakeholder matrix

Figure 1: Stakeholder matrix

(Source: Created by Author)

  • Managing director: The managing director have high power and high interest in the project, and they are the ones who provide approval regarding the progress of the project and ensure that the project is done as per the initial planning which is generally made.
  • Suppliers: The suppliers have high interest and low power, and they get a proper overview regarding the products in order to ensure that the trends are in demand and will be delivered successfully on time.
  • Customers: The customers have high power and low interest in the project, and they are the ones who mainly focus on the delivery time of the services of the organization and remain satisfied with the service.
  • Admin staff: Admin staff have low high interest and low power in the project, as they are responsible for raising invoices, despatching orders, processing payments as well as producing different types of management reports.
  • Sales staff: The sales staff have high power and low interest as they are responsible for job satisfaction as well as negotiating the prices that are mainly possible for different types of refurbished components.

The actions that will be taken to maximize the chances of each stakeholder group's activities are mainly elaborated below:

  • Firstly, it is necessary to provide proper training so that the back office admin staff can be able to prepare management reports quite effectively.
  • Secondly, the responsibility and payment of the stakeholders must also be increased as it enhances their interest in the project. 

Customers

  • The customers are attracted to participate by informing them of the benefits of the project and how the project is beneficial for the fast delivery of the services.
  • Secondly, customers must be given the opportunity of providing feedback so that any issues that they are experiencing related to the system can be easily conveyed.

Manufacturers

  • Proper presentation regarding the Lock-in project must be provided to the customers so that they have proper information regarding the project and grow their interest in participation.
  • The proper opportunity of providing feedback must be present so that the stakeholders grow interested in the project.

Sales staff

  • Firstly, it is necessary to increase the opportunity for negotiation for the sales staff, which increases their involvement in the project.
  • Secondly, proper training must be provided to the sales staff so that they can be able to deal with the clients.

Managing director

  • If the ROI of the project is high, then the involvement of the managing director within the project increases.
  • If the project helps in increasing the yearly revenue and is identified to be beneficial for the organization, then the involvement of the organization will increase. 

 The risks that are associated with the project and the actions that are recommended for minimizing the impact on the project are mainly elaborated below:

Robbin does not have sufficient admin staff of the correct calibre in order to undertake the new roles quite successfully. It is identified that due to a lack of admin staff, it would be quite challenging to undertake the work of the project, and as a result, the total time that is needed for finishing the project can increase. Enhanced time in the project schedule can cause schedule slippage that further can obstruct the progress of the project.

In order to resolve this issue, it is quite necessary for the project managers to hire new stakeholders so that they can have the proper capability of handling the work of the project quite well. In addition to this, it is quite crucial to provide training to the staff so that they can learn new skills and expertise that is needed for handling the new internet-based system so that the operations of the organizations can be managed well.

If the expected number of suppliers does not sign up for the deal, then it would be difficult for the customers of Workrite to locate a particular component from alternative lock-in suppliers and, as a result, the goals and objectives of the organization will not be achieved. It further can cause the failure of the project, which is considered one of the major risks of the project.

It is quite essential to motivate or encourage the suppliers to have the proper information as well as knowledge regarding the Lock-in so that they will be interested and will also sign up for the deal in order to successfully handle the circumstances so that it becomes quite easy to properly manage the operations of the project quite well with the help of the newly developed internet-based system.

Minimizing Risks

If the suppliers who are involved in the project do not have proper visibility of the orders pattern, then it will be quite difficult for them to ensure that the trends which are in demand can be picked up quickly such that the stock can be effectively delivered just in time. As a result, it becomes quite difficult to make proper improvements in meeting urgent orders and minimizing the requirement of holding stocks. This is mainly because the patterns of the orders are quite erratic in order to make the correct forecasting.

In order to make the right forecasting, it is necessary for the project team to collect data on a regular basis in order to get a proper overview of the order's requirement so that the project team can be able to make the correct forecasting and the suppliers who are involved can get the right visibility orders pattern, then it can be ensured that the trends which are in demand can be picked up quickly.

The idea on which the project "Lock-in" is based is quite complex, and it is quite difficult to integrate the concept within the system. During the development of the system, the project team can experience a lot of hurdles due to which the schedule of the project can be slipped, and the project can experience a delay during the progress of the project. Due to schedule slippage, it becomes quite difficult to meet the deadline of the project.

In order to avoid schedule slippage, it is quite crucial to track the progress of the project on a weekly basis to avoid hurdles during the progress of the project. Additionally, it is necessary to reward the stakeholder of Lock-in so that they get motivated to work extra and can be able to finish the work of the project within the assumed timeline

Robbin does not want to lose the sales staff as they have proper valuable expertise, and therefore by considering their knowledge, Robbin is planning to successfully redeploy some of the important time in generating new customers as well as in managing the relationship with the present customers. Both the work created pressure on the sales staff, and due to pressure, they can be unable to maintain their work-life balance, which further demotivates them and can create a negative environment.

In order to avoid such issues, the higher authority of the organization can focus on rewarding as well as recognizing employees as it would increase the engagement of the employees, which will further be helpful in creating a very positive workplace. Additionally, the incorporation of rewards as well as recognition programs is also helpful in increasing the engagement of the stakeholders that will further increase productivity as well as retention of the employees.

The total time that is needed for successful development of the system is around 15 months; however, the allocated time for the project is around ten months, and thus it becomes quite difficult to complete the project within the allocated time, and thus the project can experience schedule slippage. The actions that are needed to be considered for rectifying the situation are as follows:

Conclusion

Hiring business analyst: A business analyst must be hired to manage the suppliers well as it is not possible to manage 34 suppliers with the help of two business analysts. Hiring a greater number of business analysts is identified to be important to reduce the total time of the project by a few months though it will increase the total cost of the project quite well[1]. Hiring additional resources helps in finishing the work quite fast though there will be an increase in the total cost of the project, and the chances of reducing the total duration of the project increases.

Fast-tracking: The project team can also use the fast-tracking method to reduce the total duration of the project by compressing the schedule by running tasks much more concurrently instead of in sequence. This particular method helps in reducing the total time of the project without increasing the total cost of the project. However, this particular method can introduce risk because some of the tasks are generally started before the predecessors.

Prioritizing and phased development: The project team must focus on prioritization and phased development so that the project work can be done in a short time frame in different phases of the project to avoid delay during the project. Additionally, in order to reduce the total time of the project, it is necessary to prepare the management reports for phase 2 so that the project team gets enough time during the execution of the system so that the total time of the project can be managed quite well.

The cost-benefit analysis that is done on the new system development project is mainly provided below. It is assumed that the system would be developed within £50,000.00 and the total annual benefits are around £170,000.00 (£50,000.00 saving of the company per year +£120,000.00 increased annual sales). The calculated ROI of the project is around 4.388, and the payback of the project is one year which is reflected in the below table.

Project Cost-Benefit Analysis

Analysis Variables:

Discount Rate Used

5%

Annual Benefits

£170,000.00

Annual Operational Costs

£20,000.00

One-Time Development Cost

£50,000.00

Year of Project

0

1

2

3

4

5

TOTALS

Economic Benefit

£0.00

£170,000.00

£170,000.00

£170,000.00

£170,000.00

£170,000.00

Discount Rate

1.00

0.95

0.91

0.86

0.82

0.78

PV of Benefits

£0.00

£161,904.76

£154,195.01

£146,852.39

£139,859.42

£133,199.45

NPV of all BENEFITS

£0.00

£161,904.76

£316,099.77

£462,952.16

£602,811.59

£736,011.03

£736,011.03

One-Time COSTS

-£50,000.00

Recurring Costs

£0.00

-£20,000.00

-£20,000.00

-£20,000.00

-£20,000.00

-£20,000.00

Discount Rate

1.00

0.95

0.91

0.86

0.82

0.78

PV of Recurring Costs

£0.00

-£19,047.62

-£18,140.59

-£17,276.75

-£16,454.05

-£15,670.52

NPV of all COSTS

-£50,000.00

-£69,047.62

-£87,188.21

-£104,464.96

-£120,919.01

-£136,589.53

-£136,589.53

Overall NPV

£599,421.50

Payback

One year

Overall ROI

 4.388

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[Accessed 22 February 2024].

My Assignment Help. 'Lock-in Project: Maximizing Stakeholder Benefits And Minimizing Risks, An Essay.' (My Assignment Help, 2022) <https://myassignmenthelp.com/free-samples/comp1611-project-management/suppliers-and-customers-file-A1E0403.html> accessed 22 February 2024.

My Assignment Help. Lock-in Project: Maximizing Stakeholder Benefits And Minimizing Risks, An Essay. [Internet]. My Assignment Help. 2022 [cited 22 February 2024]. Available from: https://myassignmenthelp.com/free-samples/comp1611-project-management/suppliers-and-customers-file-A1E0403.html.

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