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Essay: Conducting a management project

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UNIT TITLE Conducting a management project

TOPIC Change management project – cost reduction, warehouse cleaning services

TASK REF

THE TASK UNIT 5006

CHANGE MANAGEMENT PROJECT

COSTS REDUCTION, WAREHOUSE CLEANING SERVICES

(UNIT 5006)

Contents

Executive Summary 3

Introduction 4

Task 1 5

A.C. 1.1 – Determine a management area for investigation that has an implication for a work-related area 5

A.C. 1.2 – Identify the aim, scope and objective of the project 5

A.C. 1.3 – Justify the aim and objective of the project 5

Task 2 9

A.C. 2.1 – Identify sources of data and information for the project 9

A.C. 2.2 – Analyse the data and information for options or alternatives that meet the project aim 9

A.C. 2.3 – Determine an option or alternative that meets the project aim 9

Task 3 13

A.C. 3.1 – Evaluate the research to make conclusions 13

A.C. 3.2 – Recommend a course of action to meet the project aim 13

Task 4 16

A.C. 3.3 –  Assess the impact of the project recommendations 16

A.C. 4.1 –  Determine the medium to be used to show the results of the project 16

A.C. 4.2 –  Produce the results of the project 16

A.C. 4.3 –  Discuss the impact of the project on the work-related area 16

The results of the project – case study 19

Discussion 20

The Bibliography and References 21

Books 21

Guides 21

Internet / Websites: 21

Executive Summary

A proposal of cost reduction through introduction of the new Contract Cleaning Company “Securiclean” or Booker employed cleaners as an alternative to currently employed Warehouse Operative colleagues being allocated to cleaning duties on a daily basis. Appointing Securiclean could result in saving approximately £40,000 per annum, employing own Cleaning Colleagues approximately £10,800 against the current cost of £238,000.

Introduction

This project report outlines the importance of conducting a management project. When considering on any project, it is crucial to understand what is required to ensure it achieves its objectives.

There are four objectives:

1. Identifying and justifying a management project

2. Conducting research and analysing data

3. Evaluating the research and making conclusions and recommendations for implementation

4. Presenting, reviewing results and assessing impact.

The report will be divided into four separate tasks, addressing all areas stated above.

Sources of information will be referenced and citations will be used in this assignment.

Task 1

Determine an area of business activity and identify and justify the aim, scope and objective of the project. Terms of reference should be included and, where applicable, a work based breakdown structure document. Produce a project plan which has a clear rationale with justification, to your project sponsor.

Guideline word count: 750 – 800 words

A.C. 1.1 – Determine a management area for investigation that has an implication for a work-related area

A.C. 1.2 – Identify the aim, scope and objective of the project

A.C. 1.3 – Justify the aim and objective of the project

The management area chosen for this project falls into the resources management and focuses on cost effectiveness and service improvement. The project will investigate how the new services could be implemented and what the benefits would be in terms of cost and time savings.

Identification

Knutson (2001) suggests that project ideas may come from three different sources:

– Strategic – driven by senior management,

– Bottom-up projects – generated by people close to the work,

– Pressed on an organisation by its customers.

The idea for this project came from the operation manager, who wanted to carry out research and find the best way to make savings in this particular area – warehouse cleaning. The company currently employs Warehouse Operatives’ colleagues and on a daily basis they are allocated to cleaning duties, 3 cleaners per shift all 17 shifts per week – 3 colleagues x 17 shifts x 7.5 hours per shift = 382.5 hours in total per week. All cleaners are trained as MHE operators, battery changers and Waste Compactor operators.

Justification

The initial investigation of current situation in the organisation suggests that the current costs could be reduced by 16.5%. In addition to savings the service provided could be also improved.

The overall aim of this project is to investigate how the company can make savings through introduction of the new Contract Cleaning Company “Securiclean” or Booker employed cleaners and what impact will it have on the current system. This would be an alternative to currently employed Warehouse Operative colleagues being allocated to cleaning duties on a daily basis.

The scope of this project

In order to improve current cleaning services within the business and reduce costs the project will investigate all available options.

The project will summarize the current situation – cleaning services provided by Warehouse Operative’s employees being allocated to cleaning duties on a daily basis. All current costs and serviced will be identified.

Costs of signing a new contract with a Third Party cleaning company and employing internal cleaners by Booker will be investigated and identified.

Pros and Cons of using a Contract Cleaning Company against employing Booker’s own colleagues will be also identified.

Conclusions and recommendations will be presented to senior management and this will have to be consulted with the Union before any changes will take place.

The project implementation 3 months’ trial.

The project will be managed by section manager A. Cedzidlo. He will be involved in investigation, design and implementation. The sponsor of this project is operation manager R. Fludder.

The objectives of this project are as follows:

 Comparison two different options in terms of cost saving and choosing the more efficient one: Third Party Cleaning Company versus Company employed cleaners.

 Reducing the indirect function hours.

 Improving the cleaning services within the business – the main warehouse area.

 Saving in management time.

 Successful completion of 3 months’ trial.

Justification of the aim and objectives is vitally important. It can be presented in a form of cost benefit analysis:

Costs:

There are no additional costs to this project, only time spent on research, investigation, design and implementation by A. Cedzidlo.

Benefits:

 No uniform or PPE costs.

 No annual bonus.

 Saving in management time.

 Consumable provided by third party cleaning company Securiclean.

 Guaranteed number of cleaners per shift every day.

 Professional cleaning service / standard.

 Limited amount of training for MHE.

 Reduced indirect hours.

 Other benefits may occur post and throughout implementation.

Project plan

ACTIVITY / WEEK Week

1 Week

2 Week

3 Week

4 Week

5 Week

6 Week

7 Week

8 Week

9 Week

10

Initial discussion with Operation Manager

Gantt chart

Gathering background information

–       Desk research on current cleaning system within the business.

–       Desk research on available third party cleaning businesses in the area.

–       Hourly employee’s rates from Payroll Department,

–       Yearly uniform costs obtained from Finance Department,

–       Yearly consumables cost from Finance Department,

Research the project

–       Brief note sent to other managers for a feedback

–       The proposal of contract with an external cleaning company “Securiclean”, including the monthly costs, terms and conditions.

–       Observations of the current activities on a daily basis

Analysis and evaluation

–       Meeting to discuss results and content

–       Arranging the data

–       Creating tables

–       Conclusions

–       Recommendations

Submission of project

Task 2

Identify the sources of data and information and the research methodology you will use in this project. You are required to analyse the results of your research and fully explain the analytical tools used during the project to arrive at your conclusions.

You should determine how the option(s) or alternative course(s) of action meets the needs of the project sponsor.

Guideline word count: 650 – 700 words

A.C. 2.1 – Identify sources of data and information for the project

A.C. 2.2 – Analyse the data and information for options or alternatives that meet the project aim

A.C. 2.3 – Determine an option or alternative that meets the project aim

Business data and information comes from multiple sources. The most important aspect is to gather and use information that is relevant and reliable. The main sources are internal and external. The internal sources of data include records of people employed by the business, their payment details, costs associated with cleaning activities and consumables. External sources of information are obtained from outside the business and for this project purposes include the details of signing a new contract with a cleaning company. In the process of identifying sources, it could be very helpful to categorise all of them into the following categories:

– Primary data – original, relevant to the research data that has been collected specifically for a purpose.

– Secondary data – already exists is some form, it can be difficult to track down what is relevant for the project.

– Quantitative data – it can be collected in a numerical form, when converted into graphical form becomes information.

– Qualitative data – a non-numerical form, it can be difficult to process and can be biased.

Different types of information were used in this project. It included specific information about the cleaning activities within the business, employee’s payment details, people’s opinions, consumables costs and details of hypothetical contract with an external company.

Research and investigation methodology is directly linked to the aim, scope, objectives and plan of this management project. To gather all relevant and reliable data and information the following steps were followed:

– Desk research on current cleaning system within the business.

– Desk research on available third party cleaning businesses in the area.

– The brief note with the project description sent to other managers on all shifts for a feedback and their opinions, comments – 12 managers

– Observations of the current activities on a daily basis, as a part of a daily management tasks.

– Hourly employee’s rates from Payroll Department,

– Yearly uniform costs obtained from Finance Department,

– Yearly consumables cost from Finance Department,

– The proposal of contract with an external cleaning company “Securiclean”, including the monthly costs, terms and conditions.

The above processes provided a data and information to consider and analyse for options or alternatives that meet the project aim. The table below shows data collected from Payroll Department and Contract Cleaning Company and includes the costs details of the current cleaning system at Booker, proposal from Securiclean and costs of employing cleaners by Booker.

CONTRACT CLEANING COMPANY VERSUS BOOKER EMPLOYED CLEANERS

Proposal – 3 cleaners per shift covering all 17 shifts, worked per week 382.5 hours

Booker present Securiclean Booker employed cleaners

HOURLY RATE £10.69 * £9.95 £9.42 **

CONSUMABLES WEEKLY £34.00 £0.00 £34.00

COST PER WEEK £4,122 £3,805 £3,637

COST PER ANNUM x 52 WEEKS £214,352 £197,905 £189,131

HOLIDAYS 28 DAYS £20,204 £0 £16,669

SICK 5% £3,527 £0 £2,910

TOTAL COST £238,083 £197,905 £208,712

* – Average pay including shift allowance and bonus

** – Hourly rate £7.62 and 1.20 shift allowance and National Insurance. Employed with no bonus payments.

Appointing Securiclean could result in saving approximately £40,000 per annum, employing Booker’s own Cleaning Colleagues approximately £10,800 against the current cost of £238,000. The saving per year seems to be significant, but there are other aspects that have to be taken into consideration. The table below shows Pros and Cons of using a Contract Cleaning Company against employing cleaners by Booker.

Pros and Cons of using a Contract Cleaning Company against employing Booker colleagues

PROS CONS

No uniform or PPE cost (saving of £500 per annum) Employed colleagues may be treated disrespectfully because they are earning less.

No annual bonus No employed Battery Changer but all colleagues could be trained to do their own batteries and new fleet introduced

Saving in management time Loss of flexibility to offer another role to existing colleagues.

Consumables provided by Securiclean (saving of £1768 per annum)

Guaranteed number of cleaners per shift every day

Professional cleaning service / standard

Limited amount of training for MHE and Compactor

Encourages to multi-skill across other functions

Included in revised head count and will reduce time spent training new Pick Colleagues

Securiclean prepared to offer 3 month trial

Reduced indirect hours

Initial idea of outsourcing hygiene would appear to be good. There is no requirement to buy uniform, consumables, no bonus, guaranteed headcount, professional service, and reduction in management time and indirect hours.

Both quantitative and qualitative date have been used in the entire investigation. The information from Finance and Payroll Departments, but also from the Contract Cleaning Company “Securiclean”, the feedbacks from the other managers, their opinions and comments, desk research, gave both, the quantitative and qualitative data needed. The combination of all of them was sufficient to determine that there are other options or alternatives to the project aim. The result of the above analysis could be that the most efficient choice would be to sign 3 months’ trial with the external Cleaning Company “Securiclean” and during this period gather more information in order to confirm that the objectives of this project were met.

Task 3

Evaluate the research and explain the decision making process and the decision making model(s) used in determining the final recommendations.

You should also identify the stages involved in implementing your recommendations to improve your work area.

Guideline word count: 700 – 750 words

A.C. 3.1 – Evaluate the research to make conclusions

A.C. 3.2 – Recommend a course of action to meet the project aim

Evaluation is an integral part of the project and enables to draw the conclusions. The research conducted for this project highlighted very important key data and information. All details have been gathered in different ways. The feedbacks from the managers helped to understand what are the limitations, benefits and disadvantages of all presented options. Financial information, provided by Financial and Payroll Departments were the key to find the differences in terms of cost savings and to show these differences the table was created. Desk research and observation of the current cleaning system within the business showed that the ways for improvement can be identified, taking into account the level of service being provided. The table showing Pros and Cons of using a Contract Cleaning Company against employing cleaners by Booker was created based on managers’ comments, author’s observations, desk research and the details of contract proposal from “Securiclean”.

Appointing “Securiclean” could result in saving approximately £40,000 per annum (the current costs could be reduced by 16.8 %), employing Booker’s own Cleaning Colleagues approximately £10,800 (the current cost reduced by 4.5%) against the current cost of £238,000 (100%). During the investigation it has been found that reduction in management time could have either positive or negative impact on the quality of the services provided, due to the fact that nobody will be available directly to manage the team of cleaners from “Securiclean”.

Employing Booker’s own Cleaning Colleagues could be also beneficial in financial aspects, but the culture of the business may bring the limitations, such as changing the colleagues’ behaviour or creating the situations, where Cleaning Colleagues will be treated disrespectfully. Loss of flexibility to offer another role to existing Warehouse Operative colleagues can also be an important limitation for the business.

The costs of uniform, PPE (saving of £500 per annum), consumables (saving of £1,768 per annum), will be reduced to minimum if “Securiclean” will be appointed, as the initial contract states that this company will provide all off the above.

All of the above savings are calculated on an annual basis.

The key themes on the conclusions:

– Continue as now, no change to the cleaning system.

– Appointing Contract Cleaning Company “Securiclean”:

 Potential 16.8% savings compare to the current cleaning system

 Savings on uniform, PPE, management time, consumable, limited training, indirect hours

 Professional cleaning services provided

 Guaranteed 3 cleaners per shift

 Total saving of £40,000 per annum

– Employing Booker’s own Cleaning Colleagues:

 Potential 4.5% saving in comparison to the current cleaning system

 Loss of flexibility to offer another role to existing colleagues

 Colleagues may be treated disrespectfully, because they are earning less

 Total savings of £10,800 per annum

Recommendations should suggest ways of solving the issues, problems or maximising opportunities identified in the project aim and objectives. Irving and Smith (1998) suggest that recommendations should always:

– Be as clear as possible

– Give precise actions

– Be numbered

– Be realistic

– Be prioritised.

The final recommendations to this project were based on the decision being made as rational and objective as possible, where the cost savings and other benefits for the company were taken into consideration as the most important factor.

Recommendations of courses of actions to meet the project aim:

– Consultation with Union regarding the introduction of the Contract Cleaning Company “Securiclean” and their point of view taken into consideration – to be completed by R. Fludder, sponsor of this project.

– Depending on the Union opinion, the communication conveyed to all employees, informing them about the new company being appointed – A. Cedzidlo and managers.

– Contract Cleaning Company to be appointed for 3 months’ trial and monitored in this period (costs, savings, responsibilities) – to be completed by A. Cedzidlo, the author of this project.

– Basic training and site induction for “Securiclean” employees – site trainers.

– Upon successful completion of 3 months’ trial, 12 months’ contract discussed and signed with “Securiclean” – R. Fludder.

Task 4

Assess the impact of implementing your recommendations on your area of work and to the organisation as a whole.  Explain the different types of communication methods available to you in presenting your project recommendations and the relative merits and pitfalls of each method. Determine the most appropriate method of communication for your project recommendations and explain why you consider this method to be most appropriate. After producing the results of your project discuss the impact of the project on the work area.

Guideline word count: 800 – 850 words

A.C. 3.3 –  Assess the impact of the project recommendations

A.C. 4.1 –  Determine the medium to be used to show the results of the project

A.C. 4.2 –  Produce the results of the project

A.C. 4.3 –  Discuss the impact of the project on the work-related area

The recommendations were made to the sponsor of the project, R. Fludder. The project has not yet been implemented, therefore only intended impact of the recommendations can be assessed at this stage. One of many techniques that can be used to assess the impact could be the balanced scorecard approach. It focuses on four or more areas in which the impact of a project’s recommendations could be assessed, such as: a customer perspective, a financial perspective, an internal process perspective and an employee perspective. Due to the nature of this project, it was not agreed at the initial stages of what perspectives are and how they should be used. In this situation, the most appropriate would be to use a review framework, which will help to assess whether the project had actually achieved the benefits set out in the evidence for conclusions and recommendations. Overall, the change can be described as promising. The presentation of details, percentages and advantages seemed to have a significant impact upon the final decision. 16.8% savings in cleaning costs could result in £40,000 cost saving per annum. Professional cleaning services may also have a positive impact on a health and safety in the workplace (reduced incidents).

The results of this project were presented to a project sponsor. As mentioned above, he was involved in defining the need for the project, he approved the initial proposal and agreed to implement the recommendations for action, therefore he wanted to know how the original project aim was achieved and how closely the project objectives were met. Having decided, who the message has to be presented to and having established what message should be, the next step is to choose the channels to deliver the message. There are a various ways and methods people communicate in the workplace. The person who intends to communicate information must put across the right message in a clear and unambiguous way that will be noticed by the target audience. Each method gives the individuals an opportunity to determine how they want to transfer their message and create appropriate communication styles for different receivers. The diagram below shows basic forms of communication that may be used in the different situations (Information Based Decision Making, 2014):

Written communication is used when the detailed information such as figures and fact have to be presented, provides clear statements of discussions and the outcome can be recorded. Oral communication is a critical and popular method of business communication, that allows most problems to be resolved immediately, but can only be used where the conveyed message is not very important. There are different types of communication methods available in presenting the project recommendations. A four-channel approach seems to be appropriate to use, as it consists both written and oral communication. The channels are: a verbal presentation, a detailed written report, a written summary and written case study. The common channel used within Booker and chosen medium for presentation results of this project was a written case study – created in Microsoft Word and attached to the email sent to the sponsor of this project, R. Fludder. It was adopted to P A S S format, where the Problem (or issue or opportunity), Analysis of the situation, Solution to the problem, issue or opportunity and Satisfaction or Success are developed more in details.

The results of the project – case study

COSTS REDUCTION, WAREHOUSE CLEANING SERVICES

Problem / issue / opportunity

A possible cost reduction was identified within the cleaning department at Booker. Introduction of the new Contract Cleaning Company “Securiclean” or Booker employed cleaners as an alternative to currently employed Warehouse Operative colleagues being allocated to cleaning duties on a daily basis could result in saving approximately £40,000 per annum against the current cost of £238,000.

Analysis of the situation

All collected data and information was analysed and it was found that:

– Appointing Contract Cleaning Company “Securiclean” could bring:

 Potential 16.8% savings compare to the current cleaning system

 Savings on uniform, PPE, management time, consumable, limited training, indirect hours

 Professional cleaning services provided

 Guaranteed 3 cleaners per shift

 Total saving of £40,000 per annum

– Employing Booker’s own Cleaning Colleagues:

 Potential 4.5% saving in comparison to the current cleaning system

 Loss of flexibility to offer another role to existing colleagues

 Colleagues may be treated disrespectfully, because they are earning less

 Total savings of £10,800 per annum

Solution to the problem / issue / opportunity

Taking all the information into account the best course of action is to appoint a Contract Cleaning Company “Securiclean” for a 3 months’ trial and to monitor the costs, saving and responsibilities in this period.

Successful outcome or satisfaction

The success will be measured at the end of a 3 months’ trial, but at this stage of planning it looks like the whole project will bring the satisfaction for the company and its employees.

Discussion

The aim of this project was to investigate how the company can make savings within the Cleaning Department. The two options or alternatives were taken into account and the final recommendation was to implement the change by appointing the Cleaning Contract Company for a 3 months’ trial and to monitor the costs, saving and responsibilities in this period. The project has not yet been implemented, but it can be predicted that the impact of the project on the work-related area is significant. By doing something in a new way, the saving can be made and cleaning services will be improved. Professional cleaning company, by fulfilling their contract’s terms and conditions, will have a part in improving a health and safety in the workplace. The professional service will add value not only to Cleaning Department but the other departments within the organisation. With other departments promoting this service this will fit within all operational management activities in monitoring the progress.

The question that can be asked: Would it be better to continue to utilise the warehouse operative colleagues or employing own cleaning colleagues than brining the new business? The idea for this project came from the need of positive change within the organisation. In the certain way, continuing of using the current system or introducing the own cleaning colleagues could be positive, but to bring the satisfaction for the whole company and its employees, the best option is to try something new, not used before. From the organisational perspective this can be seen as a success.

The Bibliography and References

Books

Irving, R. & Smith, C. (1998) No Sweat: The Indispensable Guide to Reports and Dissertations, Institute of Management

Knutson, J. (2001) Project Management for Business Professionals: A comprehensive guide, John Wiley & Sons

Guides

Pathways to Management and Leadership, (2008, rev. 2013), Conducting a Management Project, Unit 5006V1

Pathways to Management and Leadership, (2008, rev. 2013), Personal Development as a Manager and Leader Management Project, Unit 5001V1

Internet / Websites:

Communication methods, 2015. Available from: http://www.tutorialspoint.com/management_concepts/communication_methods.htm, Accessed on 19/11/2015

Gantt Chart, 2015. Available from: https://en.wikipedia.org/wiki/Gantt_chart, Accessed on 10/09/2015

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