MNG00785 Project Management - Inventory System Charter Development

This project charter outlines the implementation of an inventory management system within a manufacturing industry. It details the project's scope, including a 25% inventory cost reduction and a 30% reduction in inventory component days within six months. The charter includes a business case justifying the project, a milestone schedule with deliverables, and an initial risk identification section. It also identifies required resources, stakeholders, and team operating principles, along with lessons learned. The charter is based on a budget of $29,000 and aims to reduce operational costs and human errors. The project's success is measured by specific criteria, and the document includes commitment sections for key stakeholders. The charter is a comprehensive plan for the project, providing a clear framework for its execution and management.

MNG00785
Project management
Topics 1 - 3: Develop a Charter
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Contents
1 Developing a charter:....................................................................................................................4
1.1 Charter elements...................................................................................................................4
1.2 Charter decision-making........................................................................................................5
1.3 Project Selection Prioritization Matrix...................................................................................5
1.4 Scope Statements and Business Case..........................................................................................5
1.5 Scope Overview...........................................................................................................................5
1.6 Milestone Schedule and Deliverables..........................................................................................5
1.7 Initial Risk Identification..............................................................................................................6
1.8 Resources Required.....................................................................................................................6
1.9 Initial Stakeholder Identification..................................................................................................7
1.10 Team Operating Principles.........................................................................................................7
1.11 Lessons Learned.........................................................................................................................7
1.12 Commitment..............................................................................................................................8
2 Bibliography:..................................................................................................................................9
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Letter to Sponsor
To: Manufacturing Industry
From: Project Manager, Inventory Management System
The following project charter will confirm the project scope and business case of the
implementation of inventory management system of a manufacturing industry. The project
proposal is implemented based on SMART objectives. The project proposal provides with a
milestone schedule so that the projects start and end date are identified. The risks,
resources and stakeholders are also provided with discussing the lessons learned and team
operating principles.
The projected budget for this plan is $29,000 and start date is 2nd April and end date is 11th
June. The inventory management system is used to reduce the operational cost of the
organization and reduce the human errors. The approval of this project charter includes
approval and sign of the charter which supports the strategic plan of the implementation
plan.
Project Manager
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1 Developing a charter:
In order to develop a project charter, there are some common elements in the project charter.
1.1 Charter elements
The elements in the project charter are scope overview, business case, background, milestone
schedule, success criteria, risks, assumptions and constraints, resources, stakeholders, team
operating principles, lessons learned and signatures and commitment.
Charter Elements Details
Scope overview The scope statement is taken forms based on type of the project being
implemented as well as nature of the business organization. The scope
overview provides project deliverables and includes acceptance criteria for
the project.
Business case The business case provides justification of the proposed project work with
undertaking basis of the expected commercial project benefits.
Background The background contains a brief description of the project plan. It provides
the project rationale and justification based on selected business case.
Milestone schedule Milestone schedule is a higher level plan which indicates key important
accomplishments which are anticipated over the project lifecycle. Lists of
project milestones are provided with its start and end date. In order to
estimate the completion date for each project milestone, acceptance
criteria is to be taken.
Success criteria Success criteria has list of features and measurable terms regarding
outcome of the project which is acceptable by the end users.
Risks Risk is the probability of the risks and threats which provide negative
occurrence caused by both internal and external vulnerabilities of the
project work.
Assumptions and
constraints
The project assumptions are the events which are expected to occur
throughout the project lifecycle. The constraints are the limitations which
are occurred in the project plan.
Resources The resources are supply of money, people, equipments, assets which are
drawn by an individual to function the project work effectively.
Stakeholders The stakeholders are person those are interest and concern in the project
work.
Team operating
principles
Each of the team members are respected being direct, honest as well as
open in the communication. It is completed to point of view of each
person.
Lessons learned The lessons learned are learning gained from process to perform the
project. The purpose of documentation is share as well as use of the
knowledge gained from the experiences.
Signatures It is defined as name of the person written in distinctive style as form of
identification to authorize the project charter and project related
documents.
Commitment It is the engagement and obligation which restricts freedom of the project
actions.
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1.2 Charter decision-making
In order to take decisions in the project charter, decision matrix is used and thee decisions are take
based on following factors such as:
 Resources
 Complexity
 Technology involvement
 Approval
 Potential risk levels
 Staff commitment
 Communication and education
 Metrics
1.3 Project Selection Prioritization Matrix
Project/Selection Criteria Criteria A Criteria B
Weight: 10 5 Total
Inventory management
system project 8 4
(8*4=) 36 (10*5=) 50 (36+50=) 86
1.4 Scope Statements and Business Case
The project plan is based on implementation of inventory management system in the manufacturing
industry. The project will provide an improved system to control its inventory and shorten the
delivery times by implementation of this new system. The scope statement is that the proposed
system will provide flexible and computerized bill of the computer system. It will require less support
costs.
1.5 Scope Overview
The scope of the inventory management system is to achieve inventory cost reduction of 25% with
a time period of 6 months after the implementation process. The system also reduces total days of
the inventory components by approximately 30%. There is processing of inventory transactions on
real time basis with accuracy of the stock status information. The scope of this new system is to
need lesser support costs.
1.6 Milestone Schedule and Deliverables
Milestone Completion date Stakeholder judge Acceptance criteria
Charter sign off 2nd April Project Manager List of the project
requirements
Innovation of idea to
implement inventory
management system
5th April Project Manager
Get approval of
implementation of
13th April Operation Manager
and Project
Project proposal
document with the
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system Manager contract
Designing of the
inventory management
system
29th April IS Department Functional design of
the system
Completion of designing
of the system
14th May Project Manager Sign off the project
document
Implementation in the
organization
28th May IS Department Project
documentation
Charter completion 11st June Project Manager Sign off the
documents
1.7 Initial Risk Identification
Project (Potential) Risks Risk Owner Contingency Plans
The materials taken for the
implementation of the system
are not of best quality
System Analyst The project manager is required to identify
best qualities of the materials and
equipments for the implementation process.
The implementation process
costs more as compared to the
estimated project budget
Financial
Manager
The project budget is needed and identified
in areas of reduction of project cost and took
additional project funding.
Lack of project sponsorship Project
Manager
A survey is required to be conducted among
the project staffs to identify required
capabilities of the project requirements.
Change in the support of the
project equipments
Operation
Manager
The operation manager should make
changes in the project plan when it is
identified to be performed.
1.8 Resources Required
Funding: There is required a funding amount of $29,000 to carry out the implementation
work.
People: The project team members
Equipment: IT equipments and machinery, hardware and software
Other: Training manuals
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1.9 Initial Stakeholder Identification
Stakeholder Interest in Project Priority
Project Sponsor
The project sponsor is required to provide fund for the
project based on the materials and project requirements. High
Project Manager
The project manager should plan, execute, monitor and
control the entire project work of inventory management
system implementation. High
Operation Manager
The operational department should procure all items and
equipments and verify the qualities of the proposed system. Medium
System Analyst
The system analyst analyses and designs to solve the
business problems of the manufacturing industry. They
design the system to implement the changes. Medium
1.10 Team Operating Principles
# Team operating principle
1 Completion of the project work in the mentioned timeline
2
Schedule the project meetings for interaction with the project team members and project
manager
3 Rules and regulations of the information system implementation
1.11 Lessons Learned
# Lesson
1 Learnt to complete the project schedule and estimation of project budget
2 Learnt to conduct the project meetings on status of the project work
3 Learnt to identify the project issues and control identified risks
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1.12 Commitment
Sponsor Department / Organization Signature
Please fill N/A
Project Manager Department / Organization Signature
Please fill N/A
Core Team Members Department/ Organization Signature
Please fill N/A
Please fill
Please fill
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2 Bibliography:
Kloppenborg, TJ, Anantatmula, V & Wells, KN 2018, Contemporary Project Management, 4 edn,
Cengage Learning, Boston, MA, USA.
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