MODULE 2

Assignment 2

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Learning outcome:

LO5: Complete a stakeholder analysis, statement of work, project charter, and scope
statement.

Name:
1. Instructions and guidelines (Read carefully!)
Instructions
1. Insert your full name and surname at the top of the second page of your assignment
document. Save the file as: Initials_Surname_A2 – e.g. L_Smith_A2. NB: Please ensure
that you use the name that appears in your student profile on the Online Campus (OLC).

2. Write all your answers in this document. There is an instruction that says, “Start writing
here:” under each question. Please type your answer on the line immediately below this
prompt or, if there is a numbered list for multiple points, then answer each point on the
same line as each number in the list. Do not delete “Start writing here:”.

3. Submit your assignment in Microsoft Word only. No other file types will be accepted.

4. Do not delete the plagiarism declaration or the assignment instructions and guidelines.
They must remain on your assignment when you submit.

PLEASE NOTE: Plagiarism cases will be penalised according to the Terms and Conditions for
Students.

IMPORTANT NOTICE: Please ensure that you have checked your course calendar for the due
date for this assignment.

Guidelines
1. There are 17 pages and 3 questions in this assignment.

2. Make sure that you have carefully read and fully understood the questions before
answering them. Answer the questions fully but concisely and as directly as possible.
Follow all specific instructions for individual questions (e. g. “list”, “in point form”).

3. Answer all questions in your own words. Do not copy any text from the notes, readings
or other sources. The assignment must be your own work.

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 Plagiarism declaration:
1. I know that plagiarism is wrong. Plagiarism is to use another’s work and pretend
that it is one’s own.

2. This assignment is my own work.

3. I have not allowed, and will not allow, anyone to copy my work with the intention
of passing it off as his or her own work.

4. I acknowledge that copying someone else’s assignment (or part of it) is wrong, and
declare that my assignments are my own work.

2. Mark allocation
Each question receives a mark allocation. However, you will only receive a final percentage
mark and will not be given individual marks for each question. The mark allocation is there
to show you the weighting and length of each question.

Question 1: Programme charter information 16

Question 2: Project scope and deliverables 4

Question 3: Stakeholder analysis 20

TOTAL 40

3. Assignment questions
Assignment instructions
Complete Questions 1 to 3 in this document. Make sure that you use your own words when
completing this assignment. Ensure that you have read the notes for Modules 1 and 2 before
you complete this assignment.

Complete the entire assignment in this document. All questions in this assignment are based
on the fictional scenario described below. All written assignments on this course will be
based on this scenario, which will be expanded upon in each subsequent assignment. Note:
quiz assignments won’t be based on this scenario.

(Tip: Read through the scenario to gain some familiarity with its content. Then, once you’ve
read the assignment questions, you can return to the scenario to find what’s important.)

Do not change or edit any part of this document’s formatting (e.g. font size, font colour,
headers and footers, etc.). The formatting should remain as is.

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Scenario
Imagine that it’s 16 January 2017. It’s your first day in your new role as project manager with
your new employer, Latent Energy Systems Holdings (Pty) Ltd.

You’ve learnt much about your new employer’s business and the people, and you feel
somewhat overwhelmed. Because you’re unsure of what will be important, or even
irrelevant, you’ve made detailed notes and there are a few things that stand out.

You’ve experienced tough times recently, but you feel better after a two-month break
preceding this new job. You’re grateful for the various conditions in your life that afforded
you the relaxing break between jobs. You now have this once-in-a-lifetime opportunity to
have a job that inspires you and allows you to do the work you are passionate about.

Your new role is exciting because you’ve joined a rapidly growing and successful business
that presents a variety of opportunities, any of which could be yours if you prove that you’re
a good fit in the team and dedicated to delivering what’s expected of you.

Some of the opportunities that were suggested to you were to advance your career in
project management, to get involved with green technology and the reduction of humanity’s
carbon footprint, to be involved in the upliftment of underprivileged communities, to
develop your leadership skills, and to practice your entrepreneurial skills within a small
organisation.

You briefly consider how you got here and feel indebted to an old colleague with whom
you’ve kept in touch. At a braai early last year, your friend introduced you to an
acquaintance, who just happened to be a shareholder at Latent Energy Systems. That’s how
you landed this new job. But who is Latent Energy Systems?

Introducing Latent Energy Systems:

Latent Energy Systems, or LES for short, is a group of companies founded about a decade
ago by two enterprising people: Nozuko, who was at the time a young and newly-qualified
electronics engineer, and Jake, an owner of an upmarket game farm in the Klein Karoo. The
LES group was born from Jake and Nozuko’s passion to help rural communities in Southern
Africa, who aren’t connected to a national power grid.

LES’s products include zinc “batteries” that store latent electricity and release power at 12
volts of direct current (DC), wind and solar generators that charge the batteries, inverters
and adapters for connecting lights and small appliances, and a variety of small appliances
that are specially designed to have an efficient and a low power consumption. LES provides
training on the use of their systems, and they also install and service these systems.

The zinc batteries are made in their new factory in Montague Gardens, Cape Town, while the
solar- and wind-powered generators, inverters, and all small appliances are sourced from
external suppliers.

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The cheapest configuration of an LES system comprises a 1.2m x 0.8m rigid solar panel
attached to a 6-cell battery with one inverter with sockets for up to three appliances.
Including reticulation and installation by a two-man team, these low-cost units’ individual
selling price is R4,750, excluding VAT and transport. Each low-cost unit costs LES about
R3,400 to produce, excluding client transportation and installation.

Similar to green solar water heaters, the capital cost of an LES unit is relatively high but is
countered by the running costs being a fraction of what traditional power supply costs from
the national grid would be. The battery packs must be serviced roughly once a year.

In starting up LES, Nozuko and Jake overcame several key entrepreneurial challenges:

 Acquiring funding to equip and open their first small factory;

 Developing their small business management skills and growing their management
team;

 Hiring their first team of employees; and

 Developing their marketing materials and sales processes to generate enough leads and
close enough sales to keep the business alive (this was their biggest challenge).

LES’s new strategy:

LES didn’t succeed in solving their biggest challenge alone. While they eventually developed
good marketing materials and sales methods, though they tried for a year to sell and
distribute through a commission-only logistics company, they couldn’t find a way to build
their power systems cheaply enough to make their units financially viable to their target
market of rural communities. Their customers couldn’t afford LES’s products, no matter how
desperately they needed them.

The original growth projections based on their pre-launch market research remained a pipe
dream; unable even to achieve high enough sales to further fund LES’s short-term growth.
This was a practical lesson in market research, showing the different behaviour of
hypothetical customer’s willingness to part with hypothetical cash for a hypothetical product
versus how cautious customers are with their money when the products – and their cash –
are real.

With the help of their business mentor, Jake and Nozuko revised their business strategy to
implement a two-pronged growth path, which they nicknamed their Pincer Strategy. First,
they switched their target market to land owners in the ecotourism sector, such as game
lodges, privately-owned caravan and camp sites, and country guest houses. This strategy
worked within a few months and helped keep competitors at bay as LES slowly built up a
sustainable cash inflow from sales.

A knight in shining armour:

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Second, after two years of field-proving their products, Nozuko and Jake’s work to secure
capital investment paid off with the emergence of a US-based philanthropist that revived
their business’s growth. Bill, their benefactor, is a self-made US billionaire. He now wants to
stimulate economic development in the global south by helping poor communities help
themselves through grassroots infrastructure development and business education.

Bill pays a grant via his foundation for each project’s installed systems costs (the hardware
and installation only, excluding costs for logistics, training, etc.). Bill is prepared to donate
funds indefinitely under three main conditions:

1. Recipients of LES’s products should be educated to operate and should maintain their
power systems independently of LES.

2. Recipients must prove that their household income was less than R2,500/month for the
previous two tax years. They must also find funds to cover 50% of their installation’s
cost, being the equipment’s cost and direct cost of labour to install the equipment.

3. Only projects that install systems for at least 10 separate households will be funded,
and each project must have a unit and installation value equal to or greater than 50% of
the project’s total budget (excluding logistics, travel, PM, training, etc.).

Another strategic obstacle to the struggling business emerged when Jake and Nozuko
realised that to qualify for donor funds and enjoy the associated tax advantages, and fitting
with their community-empowerment mission, they would have to split the business into a
group of companies to convert one of them to a non-profit organisation (NPO).

Splitting was a complicated process and, though well planned and executed, it nonetheless
stressed LES’s cash flow and management. The red tape with the relevant government
authorities was eventually completed only three years ago, at which time Bill’s foundation
started donating funds to run community projects.

High-level information about the group:

 The entire group of companies, including LES holdings, is collectively referred to as “the
LES group”.

 LES Holdings (LES) is the operations centre of the group. It employs all project
management personnel in its project office and provides corporate support functions –
marketing, sales, finance, HR, and IT – for all companies in the group. Jake is CEO and
Nozuko is Group MD and, together, they are the majority shareholders. Other senior
managers in the group constitute the minority shareholders as part of LES’s employee
incentive scheme. Louise, the project office manager, oversees all projects in the LES
group. She was the first employee Nozuko and Jake hired after starting their venture 10
years ago. Louise is a paragon of commitment and loyalty. She was repeatedly “hired
from within” to reach her current senior position after starting as a part-time
bookkeeper.

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 LES Projects (LES-P) is registered as a non-profit organisation and is the entity that
receives funding from Bill. LES-P’s only function is to install systems and deliver training
to communities in need. Since all products and services are effectively outsourced LES-P
only has one permanent staff member, Teresa the MD, who has been with the group
for a long time and is actually employed by LES Holdings. As a registered NPO, LES-P
can’t be owned by shareholders in the same way a regular company can, and it’s
therefore not technically correct to consider it as part of the LES group, though it does
enjoy the benefits of LES Holding’s corporate services – HR, accounting, legal, IT support
etc. – that are billed at a discounted rate to LES-P. LES-P’s trustees include Jake, Nozuko
and three other people, two of whom are based in Johannesburg, Gauteng, and one
who lives in Durban, KwaZulu-Natal.

 LES Facilitation (LES-F) is sub-contracted by LES to train recipient community members

in each project’s installation site. The MD is Sean, who specialises in coaching and
mentoring in small business entrepreneurship and leadership skills. The business-
mentoring venture he founded around the time LES started was bought out by LES
during the company split. Nozuko and Jake hired Sean as their business mentor, and it
was in fact he who catalysed the new strategy that kept LES afloat in their darker days
by switching their target market to ecotourism landowners. To keep Sean interested
and thereby retain his services, LES-F runs leadership-training programmes and sells
facilitation services to clients outside the LES group, which Sean occasionally indulges in
delivering. LES holds 60% in LES-F, while Sean holds the remainder.

LES-F has seven full-time training staff and a contingent of about 15 part-time
contractors. The contractors are hired for a few days at a time every few weeks or
months, depending on how many projects are running simultaneously, the locations of
the communities in Southern Africa, and each trainer’s availability and their availability
for travel. All training staff and Sean’s assistant report to Sean directly.

 LES Technologies (LES-T) is the hub of the LES group’s value proposition. LES-T owns the
intellectual property (IP) in the form of various patents to the latent energy systems.
LES-T also runs the newly-expanded factory that manufactures, assembles, and
conditions the systems before shipping them to each client site. Technicians who install
the systems are employed by LES-T and their line manager is Anton, the installations
manager, who in turn reports to Fred, the MD. Anton and Fred have been with the LES
group since before the company split and both have grown through the technical ranks.
The factory manager is Julie, who has a diploma and several years’ experience in
electronic hardware research and development (R&D). The factory employs about 18
people, many of who were previously employed as farm labourers and were reskilled to
work on the production lines (Nozuko’s mother is one of the factory team leaders).

Pertinent project statistics:

The budgets of all donor-co-funded community projects run by LES-P are estimated with a
10% markup on the aggregate of:

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 Hardware cost price at the factory (excluding all other charges) i.e. R4,080 for the
cheapest unit;
 Installation and professional services (training, consulting and PM) at cost to company
rates; and
 Cost of outsourced services, e.g. travel, accommodation, training venue hire and
transport of systems.

Since all projects’ budgets are based on selling price, their gross profit is part of what drives
business profit at the LES group. Private client projects have a higher markup rate. The
markup is also used to create a contingency reserve to counter project risks and issues. The
better risks and issues can be managed, the more reserve funds remain as profit after each
project.

Teresa, LES group’s financial director (FD), regularly analyses past projects to assess their
financial performance against financial policies. This is especially necessary to ensure
compliance with Bill’s third condition. Her latest figures show that projects that comply with
Bill’s third condition installed an average of 42 systems per project. This magic money
number (or MMN) is dependent on each community’s distance from Cape Town. The further
away the installation, the higher the logistical costs, and therefore the higher the MMN must
be to qualify for Bill’s continued funding.

Before Bill’s donations started, all prior projects had installed between 1 and 58 systems.
The 22 community projects co-funded by Bill, including the 8 open projects, entail between
33 and 114 systems. Initially, community projects took over 10 months to run from start to
finish, including their initial planning phase, site visits, liaising with community leaders, and
closing out the projects after commissioning the units.

As the learning curve is flattening out, though, LES is improving their project efficiency. All
community projects completed during the past 12 months, the larger ones included, were
completed from start to finish within 4 months. According to their project policy, project’s
start and end conditions are 1) when the agreement becomes effective and 2) when the
project is officially reviewed and closed, respectively. This usually happens a few days or
weeks after the systems are commissioned.

The average budget for these 22 community projects is about R339,767 each. LES’s financial
policy states that every project should aim for a 25% gross profit margin (GP%). However,
the average GP% of each community project done with Bill is 4.72%, with some even making
a loss. Although this is perfectly aligned with the intention of an NPO – hence the name
“non-profit” – this margin leaves extremely little room to cover operating overhead costs.

Fortunately, though, the tight profits and occasional losses of community projects are
limited to LES-P, being a separate legal entity, and doesn’t directly affect profitability of
other companies in the LES group. Also, because there are other projects sold to private
clients who pay full price, the profits from these private projects often do achieve GP%
target, albeit usually at lower volumes than the community projects.

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The big deal:

Since splitting LES, Jacky, the marketing manager, has been in lengthy negotiations with
several local governments and municipalities across Southern Africa who are interested in
LES’s technology. Jacky also championed a long, though quite costly, two-year sales process
with Eskom, who is concerned with solving its infrastructure challenges.

The fruit of Jacky’s labour ripened when, around October last year, an agreement was signed
between LES-P, Bill’s foundation, Eskom and Khula Projects, a division of South Africa’s
Department of Trade and Industry (DTI). Getting everyone around the table to sign this deal
was a significant task. The terms of the agreement became effective on 9 January 2017,
which signalled LES-P’s authority to start work in light of the deal.

The scope of the deal is for LES-P to install between 100 and 120 lowest-cost systems, being
the solar panel-powered units, in each of 25 communities to be selected by Eskom and DTI
throughout rural South Africa.

Bill’s foundation will continue to fund LES-P’s projects under the same conditions. The DTI
and Eskom will pay a grant equal to each project’s total budget less Bill’s grant and less
R1,000 for each household receiving a unit. DTI and Eskom’s grants will be split equally
between the projects. The R1,000 for each unit that isn’t received as grants is the cost each
household will need to pay LES-P for a unit. Because of the risk of bad debts from the
communities, Teresa is sourcing a micro-lending partner willing to take on the financial risk
involved.

If the maximum of 120 units are installed in each of the 25 sites, the deal will be worth
R18,085,782. Applying Bill’s funding rules for hardware and installation; his maximum grant
will be worth R12,237,750, while DTI and Eskom’s combined grant limit will be about
R2,850,000 leaving the balance of R3,000,000 to be collected from the recipients.

Although Louise has run three programmes with multiple communities receiving units in the
past, this is by far the biggest deal LES has had. (A programme is a collection of related
projects which, collectively, fulfil the programme’s objective.) It’s also the biggest deal
Teresa has signed in her life and, as programme sponsor and MD of LES-P, and FD of the LES
group, she might find herself in over her head.

Sting in the tail:

Although cash is available early on because Bill’s foundation pays 50% of each project’s grant
up front, the agreement stipulates that installation of units can only start after DTI’s initial
instalment has been received. This is in turn dependent on DTI’s new budgets becoming
available, which will happen only in the new tax year, i.e. after 1 March 2017.

The agreement further stipulates that handover of all units to recipient households must be
completed by Thursday, 30 November 2017. Handover must include training of at least one

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adult per household and a two-day troubleshooting period after each household’s
installation is done to resolve any potential snags while on site.

The challenge is that this deal runs concurrently with business as usual. As a result, many
more people will be needed to handle the programme’s workload and to assure all deadlines
are met. This is where you come in.

This challenge is most evident in the manufacturing process. The current production capacity
will probably need to be increased to make enough batteries in time for their shipping to
each installation site around the country. The lead time between placing orders with LES-T
and receiving the assembled units is about two months, so this could affect the entire
programme’s critical path.

Fred might need to negotiate special contracts with their solar panel suppliers, or perhaps
even find new suppliers. It’s also a concern whether or not the transport contractor has
capacity for the increased demand.

Modern government contracts seek to assure appropriate service delivery; therefore, it’s
standard for late deliveries to be penalised. These penalties will be calculated at a rate of
R250 a day of each household unit that is delivered after the 30 November 2017 deadline. At
these rates, penalties could add up quickly. For example, if one community of, say, 100
households gets their systems installed 10 days late, the penalty would be R250,000, and if
installation occurred after 30 days, the penalty would be R750,000. Despite this threat,
though, top management at LES is strongly confident that incurring penalties is an unlikely
scenario.

Programme’s work breakdown:

Because of the magnitude, Louise wants to manage the work as a programme of projects i.e.
the programme’s objectives will be achieved when all projects have achieved their
objectives. The project management team will be comprised of Louise, two project
managers and two project administrators.

As with previous community projects, Louise wants the work breakdown structure (WBS)
organised into four main components, namely:

1. Planning;

2. Communications;

3. Execution; and

4. Close out.

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Note that each component mentioned above will be managed as a separate project within
the overall programme structure as follows:

1. Programme

1.1 Planning (Project 1)

1.2 Communications (Project 2)

1.3 Execution (Project 3)

1.3.1 Sub-project 1 (Community 1 of 25)

1.3.1.1 Logistics

1.3.1.2 Training

1.3.1.3 Installation

1.3.1.4 Hand over

1.4 Close out (Project 4)

Back to the present day:

Being your first day, Louise, your direct supervisor, has shown you to your office and given
you your staff access card to the building, your network user ID and login details, plus a
heavy lever arch file neatly titled “Welcome to LES” with your name on it. It looks smart, and
has that recently-printed smell of new money.

Louise has also introduced you to some important people, like Elise, your colleague and
project administrator who will be working with you on the big deal, and Denver, one of the
project managers (PMs) at the project office who only handles projects for private clients.
Two other PMs have been recruited and they will start at LES in February.

In all your prior interactions with Louise, you’ve seen her show only a business-like, task-
focussed demeanour. But this morning you briefly noticed a more personable side to her
when she prepared your first hot drink as a member of the team. Not only that, she also
enquired into your feelings about your first day and even sympathised with you by sharing a
short anecdote from one of her more nerve-wracking experiences at LES a long time ago.

Though you hear the occasional, subdued banter and though everyone seems approachable,
the general mood is of quiet focus, heads over keyboards. Louise said she had been eagerly
awaiting your starting at LES so that the “real work” on the programme can commence.
While in the kitchen, she assigned your first tasks at LES: Louise wants you to first settle in by
logging in to your company laptop (waiting for you at your office) and setting up your

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systems and office environment. After this, she wants you to review the information about
the programme that she emailed to you before you arrived at work this morning.

The general background of LES (as described above) was shared with you during your hiring
process. The sensitive information, however, like the project financials and details of the big
deal, is what Louise emailed to you this morning (also detailed above).

Your first deliverable for Louise is to complete parts of the programme charter by drawing
on the information you’ve gleaned from your interviews and her email. Louise wants your
work emailed to her by 15h00 this afternoon.

On logging into your email system, you notice that Louise has sent you a meeting request to
review your work at 16h30. She seems organised and, although this creates a twinge of
anxiety, a sense of clarity and pride for your new role now motivates you to do your best.

Note: Remember, all questions in this assignment are based on the fictional scenario
described above.

Question 1
Programme charter information

Below is a table of fields for information that is typically written in a programme charter.
Complete this table and base your answers on the scenario given above.

Please heed the answer limits, as no marks will be awarded for that part of any answer that
exceeds the specified answer limit. For answers requiring multiple points (e.g. time
constraints) please list each point in a separate bullet.

Note:

Throughout the written assignments in this course, you will find that many questions can’t
be answered by merely looking up the answer in the course materials. This is because the
assessment approach is informed by one of the outcomes intended for this course, being
that you have practical competence in the methods covered in this course curriculum and
not merely the knowledge of the course content.

Most assignment questions therefore require you to apply the principles, tools and methods
presented in the course to the assignment scenario to develop your answers. In a sense, this
mimics what would be expected of a project manager in real life.

Section Write your answers for each section in this column

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 Create an appropriate
programme name: (Max. 2
lines)

Programme start date

(dd/mm/yyyy):

Programme end date

(dd/mm/yyyy):

Programme manager’s name:

Reasons for the programme’s

existence, i.e. “business
drivers” and other factors that
brought about the need for
this programme: (Max. 5 lines,
not 5 points)

Programme objectives i.e.

what the whole programme is
intended to achieve: (Max. 5
lines)

Time constraints: (Max. 4 

points of 2 lines per point)

Critical success factors i.e. 

factors that will contribute to
the programme achieving its
objectives: (Max. 4 points of 2
lines per point)

List of required resources to 

complete the programme
(human and equipment):
(Max. 4 points of 1 line per
point)

List of programme risks: (Max. 

4 points of 2 lines per point)

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Question 2
Project scope and deliverables

Pick any two of the four projects outlined in Louise’s programme WBS and, using the table
below, briefly describe the project scope and deliverables for each project selected. In the
first column, write only the reference number of the project and not the project name. For
example, for the “Communications” project, write just “2” in Column 1. The four project
references can be found in the scenario under the heading “Programme’s work
breakdown”. (Max. 4 lines per block)

Do not change the font size or the row heights in the table.

Project # Project scope Project deliverables

Type the Start writing here: Start writing here:

project
number
here:

Start writing here: Start writing here:

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Question 3
Stakeholder analysis

Complete the empty cells in the stakeholder analysis template on the next page with the
following information:

1. Stakeholder name: write the name of only one stakeholder for each stakeholder
role.

2. For each stakeholder you identify in the second column, write one or two
contributions that stakeholder must make to the programme or how that
stakeholder can influence the programme.

3. Similarly for the fourth column, for each stakeholder you identify in the second
column, write only one or two things the programme must deliver to that
stakeholder.

4. In the fifth column, identify how official programme information will be

transmitted between the programme and each stakeholder (e.g. by meeting,
telephone, report via email, printed reports, reports made available via an
intranet site or web site, etc.).

5. In the last column, specify the schedule or frequency, if any, for the
communication type identified in the fifth column.

Note: Please do not change the table’s properties (e.g. font size, table dimensions, etc.).
Please heed the answer limits of each section. For example, if you list multiple
communication media for one stakeholder, only the first one listed will be assessed and the
remainder ignored.

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All Rights Reserved

Tel: +27 21 447 7565 | Fax: +27 21 447 8344

Website: www.getsmarter.com | Email: info@getsmarter.com
Page 15 of 17
 Stakeholder’s contributions or Stakeholder’s expectations or Official medium of Communication schedule
Stakeholder name
Stakeholder role influence needs communication for primary medium
(Max. 1 per role)
(Max. 2 points per stakeholder) (Max. 2 points per stakeholder) (Max. 1 per stakeholder) (Max. 1 per stakeholder)

Sponsor  

Programme manager  

Donor  

Vendors (or direct  

suppliers)

© 2018 UCT / GetSmarter

All Rights Reserved

Tel: +27 21 447 7565 | Fax: +27 21 447 8344

Website: www.getsmarter.com | Email: info@getsmarter.com
Page 16 of 17
 Stakeholder’s contributions or Stakeholder’s expectations or Official medium of Communication schedule
Stakeholder name
Stakeholder role influence needs communication for primary medium
(Max. 1 per role)
(Max. 2 points per stakeholder) (Max. 2 points per stakeholder) (Max. 1 per stakeholder) (Max. 1 per stakeholder)

Resource manager (or  

line manager)

© 2018 UCT / GetSmarter

All Rights Reserved

Tel: +27 21 447 7565 | Fax: +27 21 447 8344

Website: www.getsmarter.com | Email: info@getsmarter.com
Page 17 of 17