1. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 1
Analysis of IRTC Vender Legacy System Add-On
Loren Karl Schwappach
PM 610: Project Planning, Execution, and Closure
Colorado Technical University

2. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 2
Abstract
This paper analyses the impacts to the current project budget, schedule, and resources that would
occur if IRTC were to purchase the proposed vender software add-on package for the legacy
billing system.

3. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 3
Analysis of IRTC Vender Legacy System Add-On
The vender has developed a software add-on package that the vender believes will allow
integration of IRTC’s existing customer service systems with IRTC’s legacy billing system’s
customer service functions. This add-on will not have anything to do with the web-based version
of the system but should allow the integration of the legacy billing system with current customer
service systems. There has not been any decision as to which customer service design should be
utilized nor whether or not the systems will be integrated and of the extent to which they should
be integrated. Negations with the vender are still ongoing and the project is currently
progressing smoothly according to the current schedule and budget. If accepted the software-add
on will add at least four weeks for installation of the package (testing, troubleshooting,
maintenance, documentation and instruction are not included in this period) to the project
schedule and a cost the project budget an additional $25,000 (not including the costs associated
with vender and IRTC human resources that will be required to perform the upgrade).
The project team will need to perform a cost/benefit analysis of the vender’s proposal and
speak to the Customer Service and Billing Department about the vender’s proposal. This will
involve a large change to the projects scope and may have several unforeseen factors that will
delay the projects schedule as well as reduce the projects budget (Gurlen, 2003). It is also
currently unknown whether or not this upgrade package will be an effective solution.
The reason behind the IRTC billing web-based system upgrade is to reduce the operating
costs associated with the legacy based system, improve customer satisfaction, reduce the number
of days for outstanding account receivables, and provide IRTC with a competitive edge over
competitors. The legacy system upgrade and web-based system interface are already expected to
take sixteen to twenty weeks to complete. It is currently unknown how taking the vender’s

4. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 4
software add-on option will affect this schedule.
The decision of whether or not to go with the vender’s software add on for this project
will need to receive approval from the projects sponsor (IRTC’s CEO) and project’s steering
committee due to the drastic impacts to the projects scope, budget and schedule. A cost/benefit
and revised risk analysis will also need to be completed by the IRTC project team.
Project Budget Concerns
The current budget authorizes $100,000 for vender expenses; however, vender materials
will cost $6,500 and even though IRTC plans to maximize internal human resource use for this
project, to increase personnel experience and training in related projects, we are still expecting to
spend at least $12,220 in contracted vender human resources (see figure 1 below). In summary,
the current plan leaves $73,152 ($81,210 – 10%) for unknown project risk factors.
If the project schedule was adjusted to account for the vender’s software add-on adding
four weeks for installation, two additional weeks for testing, and two additional weeks for
employee training the project will require an approximate additional $28,930 ($26,300 + 10%) in
vender human resources (not accounting for the increased use of IRTC human resources as
shown by figure 2). This pushes the true expected vender software add-on to at least $53,930.
One of the plans of the web-upgrade project Chris and Jan have been working heavily on this last
week is the integration of our legacy billing system with the web based system. Since the web-
based system is being designed from the ground up in order to support customer service
functionality the project team does not see the potential gain offered by purchasing a system
upgrade that is intended for a legacy system that is intended to be phased out. However, a
through analyst weighing the pros and cons should be completed before dismissing the vender’s
package. Whatever decision is made it will require adjustment to the projects budget and

5. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 5
schedule, a modified project scope, and approval from the project sponsor before any resources
are allocated.
Work Hours per Week
Buisness Vender Software Vender's End User & Vender
Team Lead QA
Analyst Technical Engineer Software Tester Technical IRTC Staff Vender Staff
(Terry) (Pat)
(Robin) Architect (Chris) Engineer (Jan) Writter
Cost/hr($) 100 100 120 80 80 115 115 90 Total Hours Total Hours
Stage
Week
1 16 16 0 8 0 2 10 0 52 0
Planning
2 16 18 0 8 0 2 10 0 54 0
3 16 24 4 10 0 2 8 0 60 4
4 18 20 8 10 0 3 8 0 59 8
Design
5 20 18 8 20 0 3 6 0 67 8
6 20 14 4 24 0 3 6 0 67 4
7 20 8 0 24 10 4 4 0 60 10
8 20 4 0 24 10 4 4 0 56 10
9 16 8 0 24 8 3 6 0 57 8
10 14 8 0 22 8 3 6 0 53 8
Development and 11 14 4 0 22 6 2 6 0 48 6
Testing 12 10 4 0 24 6 2 6 0 46 6
13 10 4 0 20 4 2 8 0 44 4
14 10 4 0 16 4 2 8 8 40 12
15 8 4 0 12 0 2 12 12 38 12
16 8 2 0 8 0 2 12 18 32 18
Implementation 17 6 0 0 6 0 2 16 12 30 12
and Training 18 6 2 0 2 0 2 16 4 28 4
19 4 6 0 4 0 2 8 0 24 0
Closure
20 4 4 0 2 0 2 4 0 16 0
Total Hrs 256 172 24 290 56 49 164 54 Total $ Total $
Total ($) 25600 17200 2880 23200 4480 5635 18860 4860 90495 12220
Figure 1: Initial Projected Human Resource Impacts on IRTC Project
Work Hours per Week
Buisness Vender Software Vender's End User & Vender
Team Lead QA
Analyst Technical Engineer Software Tester Technical IRTC Staff Vender Staff
(Terry) (Pat)
(Robin) Architect (Chris) Engineer (Jan) Writter
Cost/hr($) 100 100 120 80 80 115 115 90 Total Hours Total Hours
Stage
Week
1 16 16 0 8 0 2 10 0 52 0
Planning
2 16 18 0 8 0 2 10 0 54 0
3 16 24 4 10 0 2 8 0 60 4
4 18 20 8 10 0 3 8 0 59 8
Design
5 20 18 8 20 0 3 6 0 67 8
6 20 14 4 24 0 3 6 0 67 4
7 20 8 0 24 10 4 4 0 60 10
8 20 4 0 24 10 4 4 0 56 10
9 16 8 0 24 8 3 6 0 57 8
10 14 8 0 22 8 3 6 0 53 8
Development and 11 14 4 0 22 6 2 6 0 48 6
Testing 12 10 4 0 24 6 2 6 0 46 6
13 10 4 0 20 4 2 8 0 44 4
14 10 4 0 16 4 2 8 8 40 12
15 8 4 0 12 0 2 12 12 38 12
16 8 2 0 8 0 2 12 18 32 18
17 12 12 4 12 30 8 8 0 52 34
Software Add-On
18 18 10 8 18 40 6 6 0 58 48
Option
19 12 8 4 24 30 4 6 0 54 34
Installation
20 10 8 0 20 24 3 8 0 49 24
21 10 4 0 18 6 3 12 0 47 6
Add On Testing
22 10 4 0 12 4 3 12 0 41 4
23 12 2 0 10 0 2 16 12 42 12
Updated
25 8 2 0 8 0 2 16 4 36 4
Implementation
26 6 0 0 6 0 2 16 12 30 12
and Training
27 6 2 0 2 0 2 16 4 28 4
28 4 6 0 4 0 2 8 0 24 0
Closure
29 4 4 0 2 0 2 4 0 16 0
Total Hrs 348 222 40 412 190 80 248 70 Total $ Total $
Total ($) 34800 22200 4800 32960 15200 9200 28520 6300 127680 26300
Figure 2: Modified Projected Human Resource Impacts on IRTC Project

6. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 6
Project Schedule Concerns
Besides project budget impacts there are also project schedule concerns that need to be
considered. Figure 3 displays the current human resource predictions for this project. The initial
project schedule is based upon this human resource availability and although the vender claims
the software-add on will add an additional four weeks to the project schedule in actuality it is
more likely that the current schedule will require an additional eight or nine weeks (for
installation, research, testing, troubleshooting, training, and documentation). This may have a
drastic impact on employee performance as employees begin to feel there is no end to the
project. Projects with large durations can be extremely taxing on corporations for reasons
beyond budgets and schedules which is why decision makers need to approach scope changes
very critically. It may be in the best interest of IRTC to continue on without the proposed
software add-on and look into such options (if they are still required) after the completion of the
current upgrade project.
Figure 3: Initial Project RACI Chart
Other Important Factors

7. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 7
Factors to consider that don’t relate to the current projects budget and schedule include
the impacts on system performance. Will the legacy billing system continue to offer the same
functionality and performance, will the system work with the new web-based system, etc. Other
factors include things like, how will employee moral be affected, will the end users respond well
with a legacy system add-on, will project members embrace the drastic changes to the project,
how will employee reward systems need modified, does the change reflect corporate goals and
IRTC’s strategic vision, etc.
Party Involvement
Project managers need to pay careful attention whenever there are changes that impact a
project’s scope. World class Project Managers realize the prime focus for the project manager
should not be to deliver the agreed upon scope on budget and on time, but to seek optimization
of the benefits generated through the project (Gurlen, 2003). If that means allowing the scope to
change (such as the vender’s add-on would force) would generate improved project benefits it
may not be a bad thing to consider. However, allowing a projects scope to change usually
creates added costs, greater risks and increased project durations so the benefits should be
carefully weighed. Whatever the decision, changes like these cannot occur without modifying
several large aspects of the project and requires action and approval from the project sponsor and
steering committee members.
Case Study
[WHY] All projects should have formal change requests processes that can be effectively
utilized by all parties affected. As an example a [WHO] European organization sub-contracted
the expansion of a major new system to a software house. Progress was slow and sides were
concerned. [WHAT] One area of the primary concerns raised by the sub-contracting agency was

8. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 8
that that they were being swamped with changes and it was nearly impossible to get the client
organization to recognize the changes and allow for them in the planning and performance
criteria of the project. The European client organization thought a change meant, in effect, a
formal re-negotiation of the contract subject to the same extensive procedures as the original
procurement contract. For the European organization it would take months to approve a change
request. [HOW] For the software house, a change meant every occurrence where they were
required to change any element of the work done due to some unavoidable problem with
specifications. Given the mammoth weight of the European organizations change process, it was
unrealistic for the sub-contracting agency to expect neither approval nor compensation for their
work (Wallace, 2007).

9. ANALYSIS OF IRTC VENDER LEGACY SYSTEM ADD-ON 9
References
Wallace, S. (2007). Scope and Change Control. Retrieved September 19, 2011 from:
http://www.epmbook.com/scope.htm
Gurlen, S. (2003). Scope Creep. Retrieved September 19, 2011 from:
http://www.umsl.edu/~sauterv/analysis/6840_f03_papers/gurlen/