A Financial Statement Analysis Finance Essay - Free Essay Example

Sample details Pages: 6 Words: 1736 Downloads: 1 Date added: 2017/06/26 Category Finance Essay Type Research paper Did you like this example? The financial statements are the end product of the financial accounting process. The financial statements means presenting financial information presented in concise form and the financial information is related to the financials of the company. The financial statements are prepared by the firm, firstly to communicate with different parties about the financial position of the firm and secondly to analyze the performance and operations of the firm for further planning. Don’t waste time! Our writers will create an original "A Financial Statement Analysis Finance Essay" essay for you Create order Financial statement analysis is a judgmental process. The main objective of financial statement is identification of change in trends and relationship and to see the reasons for the change and what is causing that change. Judgment process can be improved by experience and use of the analytical tools. It is done to determine what all information is relevant from all the information that is available. Secondly it defines the significant relationship between the information and lastly drawing a inference and conclusion. This study contains the following analysis: Comparative Financial Statement Common Size Financial Statement Ratio Analysis Comparative Financial Statement In CFS two or more financial statement are presented simultaneously in a columnar form. This statement is prepared to cover a period of number of years in a more meaningful form and by comparing it with different years and measuring the change in each and every year and measuring the trend in various items of financial statement. It can be prepared for both Income Statement and Balance Sheet. CFS is prepared to show: The absolute amount of different items in monetary terms The amount of periodic changes in monetary terms The percentage of periodic changes to reveal the proportionate changes. Common Size Financial Statement It represents the relationship of different items of financial statement with some common item expressing each item as the percentage of the common item. The CSS is used not only in intra firm comparisons over a series of different years but also in making inter firm comparisons for the same year or several years. This can also be prepared for both Income Statement and the Balance Sheet. Ratio Analysis This is the mostly used tool for analysis in financial analysis. Ratio analysis expresses the relationship in a mathematical form between two items or a group of items related to each other is a logical manner. It is based on the fact that a single figure is not going to communicate meaningful information but when compared with other item expresses significant information. There are various ratios that are used in this project: Liquidity Ratio Current Ratio Liquid Ratio Activity Ratio Debtors Turnover Ratio Average Collection Period Working Capital Turnover Ratio Fixed Assets Turnover Ratio Capital Turnover Ratio Total Assets Turnover ratio Leverage Ratio Total debt Ratio Proprietary Ratio Profitability Ratio Gross Profit Ratio Net Profit Ratio Office Administrative Expense Ratio Return on Assets Liquidity Ratios The liquidity refers to the maintenance of, cash, bank and those assets which are easily convertible into cash in order to meet liabilities as and when they arise. The liquidity ratios study the firms short term solvency position of the firm. Current Ratio: This is the most common ratio to study the firm short term solvency position. It is calculated by dividing the current asset by the current liabilities. The benchmark for this ratio is 2:1 i.e. 2 parts of assets and 1 part of liabilities. But this benchmark changes from industry to industry. Liquid Ratio: this is also called as acid test ratio or quick ratio. This ratio establishes the relationship between liquid assets and the current liabilities. This is calculated to know firms ability to know the immediate short term position of the firm. Stock is kept out from it as it requires time to be converted into cash. This is calculated by dividing liquid assets by current liabilities. Activity Ratio The activity ratios are also called as Turnover Ratio or Performance ratio. It is a measure of movement and indicates how frequently an account has moved over a period of time. It helps us to know how efficiently and frequently the assets of the firm are being utilized. These ratios are usually calculated with reference to sales or cost of goods sold. Debtors Turnover Ratio: If a firms sells its goods on credit than this ratio helps to know how quickly the debtors are collected. This is calculated as percentage by taking net credit sales or total sales and dividing it by average debtors. With the help of this we can also calculate the amount of days or months within which the debtors are calculated. Working Capital Turnover Ratio: It measures the velocity or utilization of the working capital of the firm during the year. This is calculated by dividing average net sales by average working capital. In this if the turnover period is more than more working capital is required if it is less than less working capital is required. Fixed Asset Turnover Ratio: The ratio indicates the extent to which the investments in fixed assets contribute towards sales. It measures the firms ability to generate net sales from fixed assets. It is calculated by dividing net sales by average fixed assets. Capital Turnover Ratio: It measures the relationship between net sales and the capital employed. This ratio measures the effectiveness of the firm in utilizing its resources. This ratio is the indicator of the overall profitability of the firm. This is calculated by dividing net sales by average capital employed. Total Asset Turnover Ratio: This ratio measures the ability of the firm to use its sales to generate sales. This considers all the assets. It is calculated by dividing net sales by net fixed assets. Leverage ratio This ratio measures the long term solvency position of the firm. Accordingly, long-term solvency ratios indicate a firms ability to meet the fixed interest and costs and repayment schedules associated with its long-term borrowings. (E.g.) debt equity ratio, proprietary ratio, etc Total Debt Ratio: This indicates what percentage of the companys assets is provided by provided via debt. The measure gives an idea to the leverage of the company along with the potential risks the company faces in terms of its debt-load. This is calculated by dividing total debt by total assets. Proprietary Ratio: It relates to the proprietors funds to total assets. It helps the owners to know the owners contribution to the total value of assets. This ratio shows the long-time solvency of the organization it is calculated by dividing proprietors funds by the total tangible assets. Profitability Ratios The aim of any business organization is to earn profit and it should earn enough profits in comparison with the with the capital invested and risk. This helps the firm to measure its efficiency. Gross Profit Ratio: This ratio expresses the relationship between Gross profit and sales. It indicated the efficiency of production or trading operation. A high gross profit ratio is a good management as it implies that cost of production is relatively low. This is calculated by dividing gross profit by net sales. Net Sales: Net profit ratio establishes a relationship between net profit (after taxes) and sales. It is determined by dividing the net income after tax to the net sales for the period and measures the profit per rupee of sales. Office Administrative Expense: this ratio measures the relationship between the indirect expenses to the net sales and here we are taking office and administrative expenses. This is calculated by dividing administrative expenses by net sales. Return on Assets: Profitability can be measured in terms of relationship between net profit and total assets. It measures the profitability of investment. The overall profitability can be known by applying this ratio. This is calculated by dividing net profit by net sales. Objectives of the Study To study the financial position of the company. To analyze the financial stability and overall performance. To analyze and interpret the trends as revealed by various ratios of the company in particular. To analyze the profitability and solvency position of the unit with the existing tools of financial analysis. To know the quality of services provided from the customers To find out the satisfaction level of the customers To find out where improvements are required in the overall functioning of the company Research Methodology Descriptive research is used in this study because it will ensure the minimization of bias and maximization of reliability of data colle cted. The researcher had to use fact and information already available through financial statements of earlier years and analyze these to make critical evaluation of the available material. Hence by making the type of the research conducted to be both Descriptive and Analytical in nature. From the study, the type of data to be collected and the procedure to be used for this purpose were decided. Questionnaires: Questionnaire was used for collecting primary data. The questionnaire was constructed with close ended questions in which the respondent had to choose an option from among others as its answer. This form of questionnaire is called structured questionnaire. Tools Used: The data was collected in two manners. The primary data was collected through questionnaires, whereas secondary data was collected through the reading of journals and papers and also various brochures which were provided by Matrix Processing House. The primary data was analyzed using the software SPSS. The primary was analyzed using Cross Tabs and frequencies tables. It was depicted using bar charts, line graphs and some pie charts. Limitation of the Study The analysis and interpretation are based on secondary data contained in the published annual reports of Matrix Processing House for the study period. Due to the limited time available the study has been confined for a period of 5 years Ratio itself will not completely show the companys good or bad financial position. Inter firm comparison was not possible due to the non availability of competitors data. The study of financial performance can be only a means to know about the financial condition of the company and cannot show a through picture of the activities of the company. Due to limited number of customers the sample size has to be restricted to 15. Due to time and other constraints the study could not include every aspect of the set objective. As is the major limitation of all the surveys, the respondents may not have given true responses. The responses given have been assumed to be true. Some figures have been rounded off to the nearest rupee.

The Alien Movie Analysis - 737 Words

The Alien is a science fiction horror movie. Its setting in space and the presence of technology and artificial intelligence empathizes on its science fiction genre. Moreover, the presence of the Alien and the fact that it is a threat to human lives reflects it is also a horror film. The movie revolves around seven human beings that have the mission to return to earth from the space. Throughout the movie, the main goal of the human characters is to return to earth safely. Various dialogues of the crew members show the main goal. For example, when Captain Dallas tells everyone about the Mother’s order for the investigation of the transmission, Parker says that: â€Å"I want to go home.† Moreover, when Ripley says that they will proceed with†¦show more content†¦Another authority figure is Captain Dallas. His title and actions show that he is an authority on the ship. Dallas’ title is Captain, so it is clear that has the power to make decisions. Moreover, he gives orders to other crew members and takes the lead in the case of facing obstacles; for instance, when the Alien borns from Kane, Captain Dallas takes the lead to get rid of the alien by closing the air shafts. These actions represent Captain Dallas as an authority. The producer chooses to introduce the authority figures in the movie to relate it to real life because working und er the authorities is a common practice in real life. In the first half of the movie, it seems to the audience that Captain Dallas is the main character, but the Captains death leaves the audience in shock. After Captain Dallas dies, Ripley takes charge of the ship. She is not very prominent on camera in the first half of the movie. This shift in authority shows by Ripley’s actions; for example, she goes to talk to the mother. Since the mother was only accessed by Captain Dallas, Ripleys access to mother shows she is in charge of the ship. The producer decides to shift in the plotline of the story by making Ripley the main character in the second half of the movie to challenge the stereotypical view of women that they are not equal to men. The survival of Ripley from the Alien shows that women are asShow MoreRelatedMovie Analysis : Home, A Animated Spin On Alien Attack Thrillers Directed By Tim Johnson879 Words   |  4 PagesA quick way to feel at Home The film, called Home, a comical animated spin on alien attack thrillers directed by Tim Johnson tells a story about Aliens who call themselves the Boov. The Boov conquer the earth and relocate the planet s human population, all except for a little girl named Tip. Tip is a normal teenager with messy hair, a complete tomboy, and extremely sassy which makes her different from the rest of her population. 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Reflection Paper on Organization Behavior Free Essays

kiwiberry2900 3/9/2013 MGMT 541 Self-reflection paper Motivation Motivation represents psychological processes that cause arousal, direction, and persistence of voluntary actions that are goal directed. There are substantial positive relations between job characteristics, satisfaction, and motivation. Job characteristics of Variety and Task Significance were found to be particularly important to employee satisfaction and motivation. We will write a custom essay sample on Reflection Paper on Organization Behavior or any similar topic only for you Order Now These are examples that almost everyone will encounter in real life: Job design and job enrichment My work experience when I was in Shanghai was with the Taxation Bureau. Initially I was assigned general work in the department such as doing tax registration for the new companies and I wasn’t motivated. The job was simple, just checking and cataloging all of the documents that the company representatives provided, and giving them the application forms. I also answered related questions and followed up after the companies with the tax license were sanctioned. At this job position, the skill varieties were very limited. The routine work was just following the rules and did not need any professional judgment. After a month or so, I felt bored. Besides the skill variety, the job also lacked autonomy. Sometimes I just went out for some reason, probably there were several company representatives were waiting for me, while other time there is nobody show up in a whole day. As a young woman, I can’t further myself in the job, anyone can do it. I had no progress, no satisfaction about the job and no intrinsic motivation. Although the tasks were significant to the whole bureau, it is hard to see our bigger function of the organization. In the end, after I pleased the human resources department several times, I was allowed to join another department. A lot of young people did not like to be fixed on a general position which would not allow them to accumulate the professional experience and explore the deep side of the field, and that often makes a problem in the hierarchical organization. Equity theory The Shanghai Taxation Bureau in which I had worked for more than 10 years is a hierarchical organization including a lot of levels. It is the administrative and management body that carries out the state’s taxation activities within the administrative jurisdiction of Shanghai Municipality. Its main functions and responsibilities include implementing state taxation laws, regulations and codes, researching and formulating tax development plans and annual work plans for local taxation. The administrative position involves supervising every month’s tax declaration and collection and making sure the money will be transferred into the state treasury according to the related laws, regulations and codes. There are 26 branches attached to the taxation bureau, and over 10000 employees working in the shanghai taxation bureau. Big organizations necessitate more comparison between people, or between branches. People from every section seek to get equal benefits out of their input. There are a lot of couples in Shanghai taxation bureau. So if some branches gave the bonus to their employees, everyone in the whole system knew it. And afterwards other departments will mimic the policy to motivate theirs. That reflected the equity theory. From the equity theory, an individual’s motivation level is correlated to his perception of equity, fairness and justice practiced by the management. The higher an individual’s perception of fairness is, the greater their motivation level and vice versa. In the above context, I remembered that the branch leader who first gave the bonus will emphasize the special task they have completed, in order to stimulate his employees who have experienced high level hardship or difficulties. But other branches will spotlight their own achievements in the assignment, ultimately got the same bonus to protect or comfort their own morale in the workplace. In the year-end evaluation, every branch or individual will assess their own projects and achievements in the whole year and the human resource management would make overall balances and give different levels of reward. While some job positions comparatively have more opportunities to make achievements, others have less. Under that kind of situation, the management carried out the policy of job position rotation, therefore, almost every qualified employee with education history of financial and accounting would have the opportunities to rotate their positions. This policy is motivational, Extrinsic motivation and intrinsic otivation At my department people were driven by extrinsic motivation. We compared the bonus income, the benefit to others and calculated the upcoming income or vacation. We also expected to be promoted and got high level benefits. As if that is the core of our daily tasks. Sometimes we did some project according to superior’s will rather than the real infor mation to avoid offending the leader. We even did not consider whether the result was meaningful or not. Although the department management wanted to motivate the employees and gave the gift cards to everyone before the festivals, we were not satisfied. We wanted to get more benefits comparing with employees at other branches. From the theoretic framework, these are hygiene factors which would not make people satisfied. Sometimes we got into research projects and worked with the other teammates. These were independent projects. The person in charge the project totally explained the purpose of the project and we felt we got involved and engaged. We were empowered to use our own way to collect data, analyze it, and draw the conclusion. We felt very satisfied in these projects. We cooperated with each other, attracted by the task, and we can focus solely on the project without complicated interpersonal relationships inside of this kind of temporary group. Further more, it was different from our routine job, which gave us the opportunity to widen our view, enrich the job content, therefore satisfying all the teammates. This arrangement is like intrinsic motivation. Intrinsic motivation refers to motivation that is driven by an interest or enjoyment in the task itself, and exists within the individual rather than relying on external pressures or a desire for reward. Leadership From my experience, people want to motivate each other. He should build up himself first, has a long-term vision about the organizations, sets a goal for himself, matches the big environment and has the necessary ability or expertise in some area. Then he should also be authorized to be a leader. He may use his social skill and other ability and management resources to motivate people, and bring them together to a higher level. In my personal experience, I met good leaders as well as bad leaders. When I was a volunteer in a nonprofit organization at Chicago, I was elected as a member of the board of trustees. In this setting, the president is our board leader and he displayed a typical bad leader profile. First of all, he is not a role model. He should have a positive attitude, and be supportive to every volunteer, but unfortunately he always escaped working hard and treated other volunteers like slaves. Secondly, he did not consider the opinions of other board members, he liked to be self-centered and lack of empathy. This character embodied in his schedule and his arrangement. He had no expert power, his personality is awful and he even played tricks in the nonprofit organization, which made everybody astonished. Now he had lost in the election for the board members. Admittedly, the situation above is very unique. Generally most authorized leaders have some attractive traits such as self-awareness, self-confidence, social skills and persuasive abilities. At the same time, they fully understand the organization goals. But different leaders have their own personal features. My friend Fan is a director of the audit department. I had been in his department for 3 years, and we became friends in the end. Fan is a veteran, he had little professional knowledge in auditing, but he knew management well. His job is to motivate all the auditing group leaders and auditors. He used his legitimate power at first to assign tasks to every group. After the tasks were finished, he gave all the evaluation report to every group with the help of his assistant. At the same time, he used his reward and referent power. He always kept the department on the way of organizational goal, showed his positive attitude, gave everybody most extent of autonomy. He also used his personal relationship to strive for the best interest of our department. That is why he got everyone’s respect. In his department, morale is very high. Nobody wanted to leave. Ahthough Fan is a good leader in most aspects except his professional knowledge, he can’t exert his expert power in his leadership. A great leader is a natural leader, who can exert his idealized influence power to his followers, and help to set common goals for the whole organization, incorporate, motivate followers, have them a clear picture of the future, make them active beyond the call of the duty. Bibliography Kreitner, Robert, and Angelo Kinicki. Organizational Behavior. Boston, MA: Irwin/McGraw- Hill, 1998. Print. â€Å"Equity Theory of Motivation. † Equity Theory of Motivation. N. p. , n. d. Web. 09 Mar. 2013. â€Å"Welcome to Shanghai Municipal Office of State Administration of Taxation. † Shanghai Municipal Office of State Administration of Taxation. N. p. , n. d. Web. 09 Mar. 2013. W. Chan Kim. â€Å"Fair Process Managing in the Knowledge Economy. † (n. d. ): n. pag. Web. How to cite Reflection Paper on Organization Behavior, Papers

Project Success or Future Criteria Northern Engineering Industry

Question: Discuss about theProject Success or Future Criteriafor Northern Engineering Industry. Answer: Introduction This report is prepared to understand how a project can be evaluated from the perspective of project management. The paper discusses various theoretical constructions that determined the project resolution, its success factors and failure factors. To understand how each of these factors plays a role in project management, a case of Rolls Royce ERP implementation was taken and the project was analyzed using various factors identified by researchers. Company Background Rolls Royce is a private sector organization that had acquired Northern Engineering industry in 1989 after which the company was able to consolidate its industrial power capabilities. By 1995, the company acquired another organization called Allison Engine Company from USA and thus, added aero propulsion and gas engine turbine to its product portfolio. Over the years, Rolls Royce has become a global organization with 14 services. For running its operations internally, Rolls Royce had developed 1500 IT programs that were difficult to maintain and costly to operate(Yusuf, et al., 2004). Moreover, different systems did not provide a consistent data making it difficult for the organization to make decisions fast. For instance, the company implemented MERLIN for managing its logistics and inventory but the system lacked communication with other systems in the organization such as IBIS which was a manufacturing system. Corporate Cost Accounting (CCA) was yet another system that was to be coordinated with. On top of these systems, there were other individual systems or suppliers, partners and customers adding to complexities. Thus, the company decided to implement an ERP system which could consolidate the entire IT system of the organization. Project Case Rolls-Royce had planned implementation of an ERP solution provided by SAP. This involved implementation of SAP R/3 software package. The solution involved integration of all functional processes of Rolls Royce including manufacturing, order management, human resource management, financial systems and supply chain. Rolls Royce hired EDS for the management of project while SAP was the ERP consultant and solution provider. A project team was formed with their segregation into separate smaller teams. Every operational business unit of Rolls Royce was provided a freedom to make a plan for required activities. A release strategy was defined which involved identification, validation, cleaning, loading and archiving of legacy data and procurement of new hardware that included 1000 personal computers, 6000 software licenses and servers. The project was divided into three phases that were to be completed from 1998 to 2000 when the Go live was planned. The project began with an intense study done on the requirement and a core team was constructed for managing the implementation project. A steering committee was also formed to provide financial guidance. Standard Criteria for Project Success or Failure There are 13 success factors that are defined by Jiang that include: Clear Goals: Goals include project mission and philosophy that further determines the objectives of project team. Competent PM: It is very important the project manager who is leading the project is competent in all essential areas of project including interpersonal relationships, technical requirements and administrative functions. A project manager must also have leadership qualities to be able to motivate team and keep them aligned with the project goals. Management Support: The project must get a buy in from the top management of the project organization. Communication Channels: For the information generated on the project during each of the phases, an appropriate channel must be used for communicating the same within and outside the project teams. This information can include project progress status, risks, issues, suggestions, feedback and so on. Responsiveness: The project manager must be responsive to the client and must keep the client always updated with the progress of the project. Competent Team: The team members of a project must be competent and thus appropriate and careful selection process must be used for human resource. Good Resource allocation: resources include time, money, logistics and human resources that must be appropriately allotted to each project task to ensure that the project runs smoothly. Control Mechanism: The project plan includes schedule and budget that act as control mechanisms for projects. Client Acceptance: Client of a software project must understand the importance of it and accept the deliverables positively. Feedback Capabilities: Formal channels for taking feedbacks in response to project reviews and status reports must be established such that team members and all other parties to project are able to present their views and suggestions for improvement. Technical Tasks: The technologies used for development must be efficient and must be reviews by expert consultants and project manager before they are put to use for the project. Trouble-Shooting management: Project team members must have a way to record the problems of a project and must be encouraged by the project manager to seek resolution to these problems independently (Attarzadeh Ow, 2008). As per the Chaos report, based on the outcome of a project, a project can be categorized into three resolution types that include project success, project challenges and project impaired. Resolution THE CHAOS Report Time Budget Functions Features Success Going as per the schedule Completed within the budget All deliverables achieved Challenged (OBrochta, 2002) Behind schedule Cost overruns Some not achieved Impaired/Failed Cancelled Losses incurred All features not delivered (King, 2003) Project Success: When a project is completed on time, within budget and has fulfilled all the desired features and functionalities of the project. Project Challenged: When a project is completed and is operational with most of the functions and features met but it exceeds budget or is over time then it can be considered as challenged. Project Impaired: When the project is cancelled sometime during the project development cycle, it is called project impaired(Sauter Frese, 2003). The Chaos report defines both success and failure factors that include: Success: User Involvement: For a project to be successful, the involvement of user during different phases such as requirements gathering and acceptance testing is important. If the project is unable to meet the needs of these users then despite its completion on time and within budget, the project would only be a failure (Salmon, 2009) Management Support: Support from management is necessary to keep the project going smooth and on track failing which the project can be at a great disadvantage and can even fail(Attarzadeh, 2008). Clarity of requirements: Base level of requirements does not work in large projects and they are required to be very detailed such that they are all clear enough to judge their impacts, prioritize them and plan for activities required to meet those requirements. In case of failure to gather all their requirements of the project in the starting phase, problems can occur at later stages(Nelson, 2007). Efficient Planning: Proper planning is the key to the success of the project and to be successful the planning has to be detailed considering all aspects of the project right from its scope, time, cost to quality and resource requirements (Nelson, 2005) Failure Planning and Estimation: Planning stage involves estimation of the schedule as well as the cost that would be incurred on the project. If these estimates are not correct then they would fail to guide the project sufficiently and later cause the failure. Implementation: In software projects, implementation is a major step which has to follow a proper methodology as well as take care of fulfilment of requirements. Testing can be used to ensure that all requirements are met. If the testing or investigations are not done properly, despite the full featured development, the project can still fail to meet the stakeholder requirements(Hoffman, 2003) Human Factor: Project managers must have all the required skills to be able to manage the project efficiently. If the project manager is incapable of applying project management principles in practice sufficiently then it can also cause a failure. Moreover, lack of proper communication between different members on a project can also lead to the failure of a project despite all other factors doing well (Elenbass, 2000) Besides the two popular model used for determination of project success and failure, there are many critical success factors identified in the literature by various researchers in project discipline. (Belassi Tukel, 1996) Case Analysis The project may be analyzed with respect the project resolution, success and failure factors defined in various theories as described in the last section. The first step would be the determine, if the project was successful, challenged or impaired. The assessment can be done on the basis of how schedule, cost and features were managed on the ERP project of Rolls Royce. Schedule: The implementation was divided into three phases including first phase of strategy development and direction which was completed in the Quarter 1 of 1998, second phase which involved project planning and early development of ERP software which lasted for 2nd and 3rd Quarter of the same year and the third phase which lasted from 1998 to 2000 and was completed in three waves including operational focus, pilot development, and assembly and spares. The go live was planned in the 2nd Quarter of the year 2000. However, in the phase two of the project, there were significant changes were to be made as the first phase itself took 6 months unexpectedly instead of 4 months. Major changes in schedule were made due to following reasons: To get more time for preparing and cleaning data To provide additional time for pilot development To allow more time to complete prerequisites To get more time for resolving difficulties The Go live phase took two weeks to complete because of certain problems like user authorization difficulties, temporarily work halts on shop floors, incorrect value transfers between systems and transaction problems. Actual go live happened after one year of pilot implementation. Thus, the project was actually not completed as per the initially planned schedule(Yusufa, et al., 2004). Cost: The final cost of development of the ERP system was $2.8 million which was more than the initially planned budget. Major causes of the cost overrun were delays, underestimation of communication requirements, scope creep, lack of ownership and initial fall in productivity(Olson, et al., 2005). Features and Functions: The project faced scope creep and thus, many modifications were made in the initially decided scope. There were data variances and user authorization problems found that delayed the go live stage. The new system required changes to be made in data. Thus, from the perspective of project resolution, Rolls Royce ERP implementation project was challenged and not successful. However, this interpretation would not be sufficient enough to learn from the case and thus, the case may be analyzed with respect to individual success and failure criterias defined in theories discussed in the previous section. Thus, a list of project evaluation criteria including both success and failure factors determined in the Chaps report and in the Jiangs success measures may be applied to the ERP implementation project of Rolls Royce: Clear Goals: Goals of the project were clear from the beginning and those included development of a new ERP system and integration of all departmental processes into a single centralized system to replace old legacy systems Competent PM: Responsibility of managing project was given to EDS which was an external outsourcing company. The company already had an experience of working with SAP projects and had some SAP consultants internally. EDS was made responsible for taking over existing systems, providing required resources, developing IT system of Rolls Royce and employing SAP consultants. EDS had a good experience of working in aerospace industry and had people with specialized skills of producing architectural frameworks for ERP projects and working with SAP projects. Communication Channels: Company used meetings and seminars extensively for communicating changes to employees or training the staff on the importance as well as the use of new system Competent Team: The project team use for the ERP implementation project was divided into small segments for managing parts of the project. Every operational business unit of Rolls Royce was given its own project planning team Good Resource allocation: Resource allocation was left to the project management organization that was efficient in providing resources, scheduling and optimizing them for project. Control Mechanism: A core team for ERP system was made to oversee the project performance and control it. Client Acceptance: A high level of customization was done on the development project by SAP which is why the client organization that is Rolls Royce was particularly satisfied with deliverables. The client was involved during different phases of development to make changes in scope and ensure necessary modifications in the systems. Technical Tasks: Rolls Royce faced a major technical problem during implementation due to inaccurate data obtained from legacy systems. The data obtained was to be normalized and modified as per the desired formats for feeding into the new system. Duplication of data was one major issue faced by the organization and it took time for the new system to take over. Till all the data was normalized, cleaned and transferred to new systems, old legacy systems could not be discontinued and thus, interfaces had to be developed between the new ERP solution and the legacy systems of the organization which increased both scope and cost of the project. Trouble-Shooting management: For managing situations of trouble shooting, a risk management process was used and the company maintained a risk register with record of huge number of project risks that were identified, recorded when appearing unexpectedly and resolutions were made. Some of the risks recorded in the risk register of ERP project were: Inability to align the human resource with the project goals Inability to provide adequate support for implementation Unavailability of the required hardware during implementation Employees resistance to change of systems Lack of serious commitment from top management for implementation project Lack of knowledge in users for using new systems Inappropriate testing of the ERP system Inability to give priority to ERP implementation project due to other important ongoing projects Challenges of maintenance due to connection between legacy and new systems Serious impacts on the accounts of the organization Extension of the go live phase User Involvement: Users were involved in requirement gathering, change feedbacks during progress reporting and were provided extensive training by SAP consultants. Expert users were trained firs on the system usage which was technical and involved expert features. Later, end users were provided training by these trained expert users. Training was carried out through seminars and in the sessions, demonstration of the developed system was also done. Management Support: The senior management of Rolls Royce was not technically oriented and thus, they could not provide sufficient guidance to the project team. Thus, an initiative was taken to train them on the ERP technology to seek buy-in. Clarity of requirements: Initially, an extensive investigation was done on the requirements and they were made very clear. Efficient Planning: The plan developed at the start of the project was very detailed and determined all deliverables, their estimated duration, specifications and responsibility identification. Planning and Estimation: A range of review was conducted on the project in order to come up with proper guidance that was used for making estimates on project cost and timelines. These reviews included design review, operation review, and high level review. The plan included a detailed three step process that was conducted in three phases including planning, scheduling, and operating. Implementation: The project implementation faced three types of problems including cultural, technical and business. Human Factor: The project team expected to get immediate acceptance from employees because of improvements provided in the new ERP system but that did not happen as new system did not get much appreciation as compared to legacy systems on some parameters. Thus, a training plan was added to make employees realize the potential of new system through proper training. These training were conducted by consultant who demonstrated the system and there were 10,000 employees who were provided training. Conclusions This report was prepared to understand how projects can consider as success or failure as per the principles and practices of project management. For this, a case of ERP implementation in Rolls Royce was considered. Various project management success and failure related theories were covered and some success factors were determined. It was found that a project is not considered as success from project management point of view if it fails to deliver on time and on budget even if all the features and functions are provided. Thus, the ERP project of Rolls Royce was not a success but a challenged project. In order to understand specific factors that contributed to this status of the project were then explored for the case of Rolls Royce and based on the analysis some recommendations can be made for improvement in project management practices that are included in the next section. Recommendations The recommendations for a sound project management practice considering the learning from the case of ERP implementation project include: While planning a project, risk management is a very crucial activity to do as many risks can be avoided or easily handled in case of their occurrence in future. As this project was planned with appropriate risk management strategies, the management team was able to manage the risks on time and take appropriate decisions for their mitigation. Initial estimates for duration and costs must be prepared very carefully as any changes later can severely affect these constraints. A contingency budget may thus be allotted at the starting of the project to accommodate such conditions. The buy-in from employees and end users should be taken before the project is started as it can later on affect the development and performance of the project. Data migration can be a major issue if not considered while planning especially in IT projects. 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