Project Costs = Direct Costs + Indirect Costs Human Resource Std. Work Hours + Ovt. Work Hours Indirect Cost: Overhead (Percentage of Direct Costs) Cost of Std. Work Hours + Cost of OH (Overhead) for Std. Work + Cost of Ovt. Work Hours + Cost of oH for Ovt. Work Cost of Labours + Subcontractors / Consultant Material Cost of Project + Corpoation Fee/ ... (% of cost of project) Total Cost + Profit (% of total cost) Project Price Tax (% of Project Price) Project Price after Tax 1. Find the Std. (regular) work hours 2. Ovt, work hours = 2000 hrs - Std. work hours 3. Calculate the Salary for 2012 4. Create a table to calculate direct & indirect (OH) costs for Std. work hours 5. Create a table to calculate direct & Indirect (OH) costs for Ovt. Work hours 6. Add up Material and subcontractor 7. Calculate Corporate G & A (!!!) 8. Calculate Pofit 9. Add up all the costs - Pick up your team members from different pay grade and explain why you chose that pay gade PROPOSAL KICKOFF MEETING SSGS ste mnagement made an immediate decision SSG wobec ding on this contract. In attendance at the billing Lice meeting we representatives from all of the groups that would be applying support for wort Also in attendance was the chief executive CEO, who med 4 of 6 Cirty world be the project manager and would be assigned full time for on of the project. The project manager would be expected to work 2.000 Franklin Business Analyst "As the business analyst, it is my way to make sure that we have the right became for this project. The follow ing information in the case is critical for pro lang The market demand for the producted belofts ay Downstream prodat prades will provide SSG with a lopom cash flow stream SSG view this project is an essential comportegic plan The project may require we technological features yd, we are sure what these beakthroughs might be. However, we feel confident that we can do it in a timely man Even though we have people trained in this technology, this is pletely new type of post for SSG. We know there are Corporate legal says that it's product requirements thus far perem lead headaches for SSG "We expect that the business case may change antil such time as a is product description and requirements. In this seant. I will be working the with Jim Kirty the impact that the changes will have the business and the project. Parallel development projects are always difficult SSG interest in winning this bed is of the most importance, but we do no want to win it at a price that is so low that we are losing my We need to as soon as possible what the realistic cost is to meet the requirements. These cessful completion of this contract will open doors for elsewhere." Kathroom VP Homecare "Accending to the RFP, the bad date is huly 1, 2011, and a complete date of June 30, 2012 A SSG cally evaluate people for protein the two weeks of December po go into effect the wing of my. We de costo adjustments and salary increases the first week of January will. We expect that the age of living and lay me to be percen begin Janury 1. For those who receive peomics, they will see and 10 percent salwy inne on average "There are other fact that must be considered since the programi length. Last year, the average person in the company hat Three weeks paid vacation . 10 paid holidays . 4 days of poidsklene 5 days of training paid by pole 2 days of jury duty These costs are paid out of corporate veted and put of labor. Iam also providing you with the lary structure for the department expected to provide support for the project. (See Table 1) rower required and some it will be all weders will be paid of time and a half medias wygrade The wehead rates for cach of the departments who included in the However, overtime the werden Stof the rates on regular time Paul Chip Chief Financial Officer Kusturya has provided with the overhead rates force departments. We expect these dates from them for the duration of the project. Als, compute peneral and istrative con G&A will remained percent. The GRA in all of ur contact and styto portate hauen. The 5 days of training paid by cop 2 days of jury duty "These costs are paid out of corporate ved and out of labor. Imaliding you with the laty structure for the department expected to provide support for the project. (See The Best me will be all werken will be paid at time and a half.megarden of 5 of 6 verhales for each of the departments included in 1. However, overtime the vertical rates are only percent of the metal also regular time" Pul Chigo (Chief Financial Offer "Karten has provide you wi the overhead rates for our departments. We expect these overhead stom the same for the duration of the project. Also, our corporate preal and in istrative cow (GRA) will remain fod peront. The GRA con included in all of our contractantes necessity to support healquarters. This TABLE! SALARY INFORMATION FOR 2011 2 Media Gre M Som Super contract is a firm-fixed price at which you all know rides significa to the seller. To mitigate some of our pouble tidI want a 15 percento marin included in the contract. In the past, the contractele margins contracts ranged from 10 percent to 15 percent. The higher and the new always on the firm fixed price "I know this is the first time we have worked as a contract like this there are rink I am not opposed to adding in a mata tion. But before you overhandisliding in a large management menej remember that we want to win the contract Ellen Pom (V. Computer Technologies comider this project to be the op of the printy Fife SSG. Therefore, we will the price with the way skill levels to get the job done. I will win five people time for the duties of the project one from system programming three from software programming, and one from software engineering I helieve that each employee will be required to work at least 20 hours of direct labes the jest with the hous broken down equally each month amore right now which employees will amigas became the posad date in a few my But I will keep my promise that there will be contracts range from 10 percent to 15 percent. The higher all the range always on the furmised price "I know this is the first time we have worked act like this and there are risks. I am opposed to adding in a manamente tion. But before you go overordning in a large management remember that we want to win the Pa Vr. Computer Technologies consider this project to be the 6 of 6 priority list for SSG. The fore, we will assign the appropriate me necessary skill levels to get the job done. I will five people fall time for the duration of the project one from em programming from software programming and from software engineering believe that employee will be required to work at least 2.000 homo direct labore this per jest with the hours bekendown qully eachment "I am not sure right now which employees will win because the pad date in a few months away. But I will keep my promise that there will be fire workers and that they will be committed full time with no responsibilities projects. In addition. I am hiring consultant with expertise in this type of The cost for the consultant for the duration of the page will be 575.000 Erion VP. Manom vreyee all known TV news broadcases about the problems smartphe manufacturers were with the casting and cover. To avadaving the same problems and alienat TT I will be assigning one of my manufacturing engineer who is an expert in engineering and quality expect him to be assigned for my hoan be ning some time after my 2012 "The RFP requires that we experiment with various tech screen to see if the software is affected by the screen size and screen thick. This old be part of the problem that other suppliers were having. This experimentalis also included as part of the manufacturing engineer's "estimate that we will need about 56.000 in material. We should bly include a scrap face as well, bunun right now how muchos factor is reseable Erwery (Pipesa Mang TT was the proposal in their hands within 30 days. I think that's conogh time to make owestimates Homes 30 of all proposal we did for a couple of years ago. See Tablets give you an idea how we price out our projects for compte bidding "Popether with your individual estimates, Labemedalisting of all of the assumptions you made in arriving at your estimates. This is antical in fornisk management and decis ca scop change." TABLE TYPICAL PROJECT PRICING SUMMARY Tractatur in | 10 Mam 3. She Cep Project Costs = Direct Costs + Indirect Costs Human Resource Std. Work Hours + Ovt. Work Hours Indirect Cost: Overhead (Percentage of Direct Costs) Cost of Std. Work Hours + Cost of OH (Overhead) for Std. Work + Cost of Ovt. Work Hours + Cost of oH for Ovt. Work Cost of Labours + Subcontractors / Consultant Material Cost of Project + Corpoation Fee/ ... (% of cost of project) Total Cost + Profit (% of total cost) Project Price Tax (% of Project Price) Project Price after Tax 1. Find the Std. (regular) work hours 2. Ovt, work hours = 2000 hrs - Std. work hours 3. Calculate the Salary for 2012 4. Create a table to calculate direct & indirect (OH) costs for Std. work hours 5. Create a table to calculate direct & Indirect (OH) costs for Ovt. Work hours 6. Add up Material and subcontractor 7. Calculate Corporate G & A (!!!) 8. Calculate Pofit 9. Add up all the costs - Pick up your team members from different pay grade and explain why you chose that pay gade PROPOSAL KICKOFF MEETING SSGS ste mnagement made an immediate decision SSG wobec ding on this contract. In attendance at the billing Lice meeting we representatives from all of the groups that would be applying support for wort Also in attendance was the chief executive CEO, who med 4 of 6 Cirty world be the project manager and would be assigned full time for on of the project. The project manager would be expected to work 2.000 Franklin Business Analyst "As the business analyst, it is my way to make sure that we have the right became for this project. The follow ing information in the case is critical for pro lang The market demand for the producted belofts ay Downstream prodat prades will provide SSG with a lopom cash flow stream SSG view this project is an essential comportegic plan The project may require we technological features yd, we are sure what these beakthroughs might be. However, we feel confident that we can do it in a timely man Even though we have people trained in this technology, this is pletely new type of post for SSG. We know there are Corporate legal says that it's product requirements thus far perem lead headaches for SSG "We expect that the business case may change antil such time as a is product description and requirements. In this seant. I will be working the with Jim Kirty the impact that the changes will have the business and the project. Parallel development projects are always difficult SSG interest in winning this bed is of the most importance, but we do no want to win it at a price that is so low that we are losing my We need to as soon as possible what the realistic cost is to meet the requirements. These cessful completion of this contract will open doors for elsewhere." Kathroom VP Homecare "Accending to the RFP, the bad date is huly 1, 2011, and a complete date of June 30, 2012 A SSG cally evaluate people for protein the two weeks of December po go into effect the wing of my. We de costo adjustments and salary increases the first week of January will. We expect that the age of living and lay me to be percen begin Janury 1. For those who receive peomics, they will see and 10 percent salwy inne on average "There are other fact that must be considered since the programi length. Last year, the average person in the company hat Three weeks paid vacation . 10 paid holidays . 4 days of poidsklene 5 days of training paid by pole 2 days of jury duty These costs are paid out of corporate veted and put of labor. Iam also providing you with the lary structure for the department expected to provide support for the project. (See Table 1) rower required and some it will be all weders will be paid of time and a half medias wygrade The wehead rates for cach of the departments who included in the However, overtime the werden Stof the rates on regular time Paul Chip Chief Financial Officer Kusturya has provided with the overhead rates force departments. We expect these dates from them for the duration of the project. Als, compute peneral and istrative con G&A will remained percent. The GRA in all of ur contact and styto portate hauen. The 5 days of training paid by cop 2 days of jury duty "These costs are paid out of corporate ved and out of labor. Imaliding you with the laty structure for the department expected to provide support for the project. (See The Best me will be all werken will be paid at time and a half.megarden of 5 of 6 verhales for each of the departments included in 1. However, overtime the vertical rates are only percent of the metal also regular time" Pul Chigo (Chief Financial Offer "Karten has provide you wi the overhead rates for our departments. We expect these overhead stom the same for the duration of the project. Also, our corporate preal and in istrative cow (GRA) will remain fod peront. The GRA con included in all of our contractantes necessity to support healquarters. This TABLE! SALARY INFORMATION FOR 2011 2 Media Gre M Som Super contract is a firm-fixed price at which you all know rides significa to the seller. To mitigate some of our pouble tidI want a 15 percento marin included in the contract. In the past, the contractele margins contracts ranged from 10 percent to 15 percent. The higher and the new always on the firm fixed price "I know this is the first time we have worked as a contract like this there are rink I am not opposed to adding in a mata tion. But before you overhandisliding in a large management menej remember that we want to win the contract Ellen Pom (V. Computer Technologies comider this project to be the op of the printy Fife SSG. Therefore, we will the price with the way skill levels to get the job done. I will win five people time for the duties of the project one from system programming three from software programming, and one from software engineering I helieve that each employee will be required to work at least 20 hours of direct labes the jest with the hous broken down equally each month amore right now which employees will amigas became the posad date in a few my But I will keep my promise that there will be contracts range from 10 percent to 15 percent. The higher all the range always on the furmised price "I know this is the first time we have worked act like this and there are risks. I am opposed to adding in a manamente tion. But before you go overordning in a large management remember that we want to win the Pa Vr. Computer Technologies consider this project to be the 6 of 6 priority list for SSG. The fore, we will assign the appropriate me necessary skill levels to get the job done. I will five people fall time for the duration of the project one from em programming from software programming and from software engineering believe that employee will be required to work at least 2.000 homo direct labore this per jest with the hours bekendown qully eachment "I am not sure right now which employees will win because the pad date in a few months away. But I will keep my promise that there will be fire workers and that they will be committed full time with no responsibilities projects. In addition. I am hiring consultant with expertise in this type of The cost for the consultant for the duration of the page will be 575.000 Erion VP. Manom vreyee all known TV news broadcases about the problems smartphe manufacturers were with the casting and cover. To avadaving the same problems and alienat TT I will be assigning one of my manufacturing engineer who is an expert in engineering and quality expect him to be assigned for my hoan be ning some time after my 2012 "The RFP requires that we experiment with various tech screen to see if the software is affected by the screen size and screen thick. This old be part of the problem that other suppliers were having. This experimentalis also included as part of the manufacturing engineer's "estimate that we will need about 56.000 in material. We should bly include a scrap face as well, bunun right now how muchos factor is reseable Erwery (Pipesa Mang TT was the proposal in their hands within 30 days. I think that's conogh time to make owestimates Homes 30 of all proposal we did for a couple of years ago. See Tablets give you an idea how we price out our projects for compte bidding "Popether with your individual estimates, Labemedalisting of all of the assumptions you made in arriving at your estimates. This is antical in fornisk management and decis ca scop change." TABLE TYPICAL PROJECT PRICING SUMMARY Tractatur in | 10 Mam 3. She Cep