PROJECT CHARTER 2 - ERP Rollout EXAMPLE ONLY CAN BE IMPROVED
Project Contact and Approval Information
Project Name/Number
General Plant ERP Rollout
Sponsoring Organization
General Plant Fulfillment
Project Sponsor Name: David Tracy Phone: 555-
5555
Office Address: 123 Mail Stop
Email: .com
Project Leader Name: Sam Peters Phone: 555-
4444
Office Address: 123 Mail Stop
Email: .com
Team Members (Name) Title/Role Phone Email
Cheryl J Fulfillment Specialist 1234 .com
Willard T Product Line Scheduler 0123 .com
Kevin K Product Line Engineer 2345 .com
Ray A Data Setup Analyst 3456 .com
Vern R ERP Analyst/Programmer 4567 .co
Will L Shopfloor Control Analyst/Prog 5678 .com
Tami S Integration Specialist 6789 .com
Principal Stakeholders Title/Role Phone Email
David T Fulfillment Manager 5555 .com
Vincent A Plant Manager 0987 .com
Ione C Legacy IT Manager 8765 .com
Jan K Materials Mgmt Manager 7654 .com
Date Chartered: 10/3/2016 Project Start Date: 11/15/2016 Target Completion Date:
4/1/2017
Revision: 1.0 Date: 10/3/2016
Sponsor Approval Signature: Date:
Updates & Approval Log
Revision Date Sponsor Approval Signature
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1.0 BUSINESS ANALYSIS
1.1 Business Problem/Opportunity
What is the problem: Legacy mainframe system for scheduling and managing the shop floor is
inadequate. Extra overhead is required in the production facility to manage the system.
Customer service in legacy-plants lags that of plants which have been rolled out on the new ERP
solution. The legacy system does not provide timely feedback of production status (i.e. where
the line is on the schedule) or quality issues.
What is the real problem: The legacy mainframe solution could be tweaked to better serve the
shop floors needs, but the cost to do so is prohibitive and the technology is outdated and largely
unsupported. Few of the original system architects remain with the company; therefore, the
ability to change the system is severely limited. The legacy coders that remain are very under-
utilized, since there is less and less volume flowing through this IT channel.
Whose problem is it: The shop floor is heavily affected negatively by the legacy system. The
customer is also impacted due to sub-standard quality and service due to missing information to
operate the plant. IT also shares the burden of supporting multiple platforms, making the
mainframe a liability for resource planning.
Where does the problem come from: The problem originates from ITs inability to support the old
mainframe system. The mainframe technology is 25+ years old it has completed its life cycle.
Why do we want to solve the problem: The problem needs a solution to improve first-pass
quality yield, customer service, and ultimately better serve our customers at a lower
manufacturing and overhead cost.
1.2 Project Scope/Objective
The goal of this initiative is to cut manufacturing overhead and provide better information to run
the business by implementing an ERP solution using cut and paste solutions containing the
following modules:
Assembly
Procurement
Fabrication
Shop floor control system (SFCS)
Training and documentation
The plant will drive the requirements; IT will create the solution. Project to be completed by
4/1/2017.
In Scope:
Hands-on training
Training documentation
Component sequencing solution
Stabilization support for 90 days
Out of Scope:
Code modifications to existing solution already developed for other plants
OEE machine-to-SFCS linkage
Hardware modifications to existing solution already developed for other plants
Query-based report package
1.3 Benefits & Potential Value(s)
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Marketing
Faster NPI
Enables direct sync with ordering software
IT
More stable integration into interface software (less support time required)
Ability to decommission legacy systems
Development of common IT platform across enterprise to concentrate IT
resources
Finance
More reliable data
Data/information is easier to control and/or disseminate
Manufacturing
Scheduling support for only one IT system (versus current state = four)
Single, central repository for all data
Elimination of three FTEs due to ease of software use
Reduction in inventory cost due to higher data integrity
Improved customer service due to higher data integrity
1.4 Impacts of Doing Nothing Internal to the Business
1. High overhead cost of maintaining legacy system maintained
2. Inaccurate financial data/estimates due to inaccurate information difficult to make
decisions with bad information
3. Cost of poor quality will not improve since no efficient way to collect information
4. Increased risk of large-scale customer service issues due to mainframe failure or
incurable bug
1.5 Impacts of Doing Nothing External to the Business
1. Cannot match competitor price point due to increased internal costs
2. Quality of product is not as high due to lagging/inaccurate quality feedback from
shop floor
3. Increased risk of large-scale customer service issues due to mainframe failure or
incurable bug
2.0 PHASES & MAJOR DELIVERABLES
2.1 Deliverables
Kanban-based procurement/fabrication system, MRP-based finished goods system, and shop-
floor control with the following in place:
1. Standard work updated on manufacturing floor to account for new
responsibilities
2. Work instructions provided for scheduling and procurement staff
3. Training sessions for all impacted parties
4. Scrubbed BOM data
5. Quality system tied into shop-floor control
6. Memo to sales-channel on new product/package appearance
7. Basic report package (shortage reports, error reports, etc.)
2.2 Activities (list in sequence order if known)
1. Build team with members from IT, manufacturing, finance, and materials
management
2. Complete the following for each phase (procurement, fabrication, assembly):
a) Define discrete objectives
b) Measure and quantify current state performance and cost of legacy system
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c) Map current state process and identify gaps between current and future state of
both IT capability and business readiness
d) Close gaps
e) Train, document, and present for launch approval
f) Launch
g) Stabilize and measure for anticipated results
3.0 PROJECT VITAL SIGNS
3.1 Overview of Schedule
Requested Start: 11/15/2016
Required Delivery: 4/1/2017
Timing Concerns: DH rollout team is slightly behind schedule. Need team to close project
by 10/31 in order to roll members to this project.
3.2 Assumptions
Recent acquisition does not impact IT resources/priorities
Business readiness can be achieved within five weeks
Finance has resources to support rollout
Product lines do not relocate prior to 4/07
Shop floor experts are available to provide expertise
Dependencies
Current IT team needs to execute preceding rollouts on time to free up by 11/15
3.3 Major Quality Assurance Reviews and Roles
We will use the stage gate process for this project, with the exception that the first gate is already
passed. The remaining gates are planning, executing, controlling, closing. Before each stage
is closed, a gate review will be held with the stakeholders to review progress and decisions made
during that stage.
Estimates of the gate closes are:
Planning/design: March 1
Executing: April 1
Controlling: May 1
Closing: May 15
See section 5.2 and 5.3 for other informal updates on progress on decisions.
3.4 Risks and Contingency Plans to Cover Them
Team member leaves: if a plant expert/resource, substitute secondary backup for
absentee; if an IT expert/resource, take resource from DH Plant stabilization to backfill
(DH Plant will be backfilled by contract IT resource)
o Impact of not managing this risk is delay in project delivery and/or inferior design
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Existing data (BOMs, routings, etc.) found during discovery/investigation is grossly
incomplete or inaccurate: three experienced associates from shop floor are available to
re-create missing data; they will be backfilled through temp agency
o Impact of not managing this risk is delay in project delivery and/or incorrect
BOMs that will crash all MRP scheduling and procurement functions due to
inaccurate inventories
Product line is redesigned: freeze line changes by working with plant engineering after
design phase of project
o Impact of not managing this risk is having a design that is not compatible with
the line layout and/or not having the hardware to support new line layouts
Integrations between systems fail: build inventory prior to rollout to cover four days of
sales; have 24-hour IT support available during rollout week
o Impact of not managing this risk is customer service fall down and lost
productivity
Management dictates shop floor personnel cannot participate due to budgetary
constraints: secure backup resources from other cost centers who have past experience
in impacted areas
o Impact of not managing this risk is incorrect data in the ERP system leading to
increased potential for inventory stockouts
3.5 Estimated Labor Costs (# Hours)
3.6 Estimated non-Labor Costs
Expense for hardware: $160,000
Network/electrical drops: $30,000
Training center and documentation fees/costs: $10,000
3.7 Interdependencies with Other Projects
DH rollout team is slightly behind schedule. Need team to close project by 10/31 in order to
roll members to this project.
3.8 Functional Areas Impacted by Request
Manufacturing, Marketing, Sales, Quality, Fulfillment, Helpdesk
Contacts per area:
Manufacturing Jill H
Marketing David N
Sales Robert K
Quality Ben A
Fulfillment David T
Helpdesk Ione C
4.0 Project Staffing
4.1 Project Staffing and Time Commitments
Cheryl J - Fulfillment Specialist 60%
Willard T - Product Line Scheduler 35%
Kevin K - Product Line Engineer 50% (all prior to 1/1/2017)
Ray A - Data Setup Analyst 100% (all prior to 2/1/2017)
Vern R - ERP Analyst/Programmer 50%
Will L - Shopfloor Control Analyst/Programmer 100%
Tami S - Integration Specialist 50% (all after 2/1/2017)
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4.2 Special Resources Needed
All resources have been previously identified
4.3 Project Organization (Roles & Responsibilities)
Champion: David T
Project Leader: Sam Peters
Cheryl J shopfloor expert and current legacy process expert. Responsible to represent the
needs of the production floor and ensure their needs are delivered.
Willard T shopfloor expert and current legacy process expert. Responsible to represent the
needs scheduling team and ensure their needs are delivered.
Kevin K connection to engineering team who is responsible to let team know of any equipment
moves and/or product changes occurring prior to 4/1/2017.
Ray A data setup expert responsible for building BOMs.
Vern R ERP application expert responsible for coordinating code efforts and training
scheduling team.
Will L shopfloor control application expert responsible for coordinating code efforts and training
scheduling and shop floor team.
Tami S integrations IT expert responsible for tying all new IT systems together to pass
information seamlessly.
5.0 Project Management Approach
5.1 Approach
The team will sit in a war room prior to noon every day for the duration of the project. All
decisions will be subject to approval by consensus. Once all information is gathered, a decision-
meeting will be scheduled for 60 minutes. If after 60 minutes a consensus cannot be reached,
project leader will make final decision.
MS Project will be used to set and measure against the project timelines. A daily action log will
record everyones progress and decisions made with accompanying rationale.
Initial timeline assumes 5-day weeks; nights/weekends will be used as needed to complete
project on time.
5.2 Status or Progress Reporting Plan
Team will sit in war room for duration of project prior to noon every day. A daily 15 minute
standup meeting will be the internal-communication for the team. Minutes from these meetings
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will be compiled and emailed every Friday to all stakeholders. Cheryl J and Willard T will
communicate progress to the plant during weekly plant meetings (as a 5-minute agenda item).
Ad hoc updates will be given upon request.
5.3 Change Management Approach
Formal signoff on revised charter if scope is changed. To initiative a change, scope revision
request form must be completed and submitted to Sam Peters. Form requires cost/benefit
analysis of requested revision.
Changes approved by Jan K and David Tracy. Changes will be communicated through email to
impacted stakeholders and project team.
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