Renovation of Head Office of Superior Implements (SIM Co.)

TASK 2.1 Project Initiation document
Project Information
Project Title: Renovation of head office of Superior
Implements (SIM Co.) Prepared by: Susan Bones
Date: 12/31/18 Distribution: NA
SECTION 1: Project Definition
Background The project is developed for the renovation of the head office of Superior Implements (SIM Co.) and it would involve the usage of
less than 6 months for the completion of the renovation works. The company wants their head office to be renovated and developed
into a new office by working on the flooring, replacing kitchen and bathroom facilities, and refurbishing them for the organization.
Purpose The main purpose of the project is completing the renovation works for the head office of Superior Implements (SIM Co.) by finishing
all the expected works in the assigned time and budget.
Objectives To renovate the head office of Superior Implements (SIM Co.) by using the effective project management tools and functions
To complete the project in the estimated time and budget
To employ project management tools and processes for ensuring the implication of the improved work alignment
Scope The project involves the renovation of the head office of Superior Implements (SIM Co.) and it would involve the usage of less than
6 months for the completion of the renovation works. The works required in the project are working on the flooring, replacing kitchen
and bathroom facilities, and refurbishing them for the organization. The project scope involves documentation works, risk analysis,
budget estimation, renovation works, installing of the new equipment, and flooring works.
Deliverables The deliverables for the project would include,
Project Plan for the execution of the project
Cost estimation plan for managing the resources
Renovated head office of Superior Implements (SIM Co.)
Installed the new facilities at the kitchen and bathroom of head office
Constraints The time, budget, and quality factor acts as the constraints of the project of Renovation of head office of Superior Implements (SIM
Co.). The estimated time, calculated budget, and required quality factor would serve the purpose of the acting as the constraints of
the project.
BSBPMG522_AT2_Task2.1_ProjectInitiationDocument Page 1

Assumptions The assumptions of the project include the acquiring of the resources in time, formation of the team, completion of the works, and
meeting the quality and WHS standards.
SECTION 2: Business Case
Benefits The benefits of the project of Renovation of head office of Superior Implements (SIM Co.) are,
Renovation would help in getting rid of the damping and flaws in the infrastructure
It would allow the replacing of the old facilities of kitchen and bathroom
These benefits would be measured by the final approval of the project work and deliverable by the client
Options The options included for the renovation of the head office of SIM Co. are utilization of the effective project management
methodology for the renovation works and implying the analysis of the effective alignment of the works. The renovation would be
deployed with the formation of the innovative work integration. The renovation would be supported by the formation of the improved
analysis and development. The options would be integrated with the successful alignment of the improved innovation. The utilization
would be deployed with the formation of the successful work alignment and the integration of the renovation works using Design Bid
procurement.
Cost/Benefit Analysis The cost benefit analysis would be done considering the utilization of the cost income and expense analysis. The cost benefit would
be evaluated by deducting overall expenses from the income and calculating the present value of the project. The one time cost of
the project was expected to be $60,000.00. The maintenance cost of the new head office would be increased by $500 per month.
However, the monthly benefit of the new head office would be $3000. The following table would show the calculation of the NPV,
ROI, and Payback period,
Cost benefit analysis
Year 0 Year 1 Year 2 Year 3
Net economic benefit $0 $36,000 $36,000 $36,000
One time cost ($60,000) $0 $0 $0
Recurring cost $0 ($6,000) ($6,000) ($6,000)
Net cash flow ($60,000) $30,000 $30,000 $30,000
Discount factors
Discount rate 10%
Year Index 0 1 2 3
Discount factor 1 0.91 0.83 0.75
BSBPMG522_AT2_Task2.1_ProjectInitiationDocument Page 2

Discounted flows
Cost ($60,000) ($5,455) ($4,959) ($4,508)
Benefit $0 $32,727 $29,752 $27,047
Net ($60,000) $27,273 $24,793 $22,539
Cumulative ($60,000) ($32,727) ($7,934) $14,606
Net present value $14,606
ROI 23%
Payback Analysis
Years Months
2 4.22
Payback Period in Years 2.35
Risk Identification The identification of the risk factors is a major tool supportive for the implication of the innovative work alignment and the utilization
of the works for the successive implication of the work. The risk identification would involve the formation of the successive work
integration and the formation of the improved work alignment. The development of the successive work formation had been
developed with the improvement of the activities. The risk identification and the analysis would be deployed with the innovation work
development and formation of the activities. The risk identification would be developed with the continuation of the explicit work
development. The identified risk of the project has been implied with the continuation of the successful work alignment. The risk
factors have been explained below,
Delay in work: The delay in completion of the work is implied with the continuation of the effective work development and the
formation of the successive operations. The identified risk factors for the project has resulted in delaying the completion of the
project and the formation of the basic issues in the completion of the work. The work function delay would result in forming
hindrance in the successful and innovation work alignment for the renovation works. The work delay can be resulted by the probable
issues of machines, humans, and financial shortage.
Shortage of budget: The shortage of the budget is another factor resulting in forming the major issues for the completion of the
works. The budget analysis has resulted in implying the innovation and development of the improved work listing. The budget
shortage would be resulted due to lack of resources or over usage of the resources. Sometimes due to underestimation, the project
cost increased too. It results in forming major issues in the completion of the project works. The budget estimation lacking any
contingency or provisional budget would result in the shortage of the budget.
Technical Issue: The technical issue is a major factor resulting in the issues of the renovation works of the project such as
equipment failure, material missing, transportation issues, and allocation issues. The issue in completion of the works would result in
forming the technical issue in the project. The technical issues would result in forming the major alignment issues for the users.
BSBPMG522_AT2_Task2.1_ProjectInitiationDocument Page 3