Islamic Republic Of Afghanistan
Ministry of Higher Education
DUA (Dunya University of Afghanistan)
Management science Faculty
The Kabul Taxi Project
Name: Mohibullah Wahab
f/Name: Najeebullah
ID No: BBA 1693223-14
Contact No: +93782303638
Email Add: [email protected]: 17th, 2nd Year, Morning
Course Instructor: “Mr. Mahmood Ebadi”
Date: April 2016
Approved by Mr. Ebadi during lectures.
Kabul Taxi
Our mission is to provide reliable, timely, and safe cab services by using complete, in-car credit and debit card access, along with computer-aided dispatch.
As we Know traveling about Kabul is very dangerous, finding a good taxi is difficult specially if your foreigner which need a taxi driver that can speak English well enough, and as Kabul have a very bad traffic so finding a taxi driver which knows different routes is quit hard. Kabul Taxi will provide complete taxi cab services that you can trust, using the latest equipment and technology to facilitate for individuals in and around the Kabul city. We have focused on services and we have a realization that effective communication is a key component in our business. Most drivers will be able to tell you which time is best for travel. They’ll also know how safe it is to travel out of the city. You will have driver that knows how to talk to the security checkpoints when security is high.
PERT (Project Evaluation Review Technique)
Kabul Taxi needs immediate 50 cars to start its services, Project manager of the company is confident that he can purchase/import cars (project) might take 20days as he have experience as he was involve in car selling company as a car seller, with the most optimistic view if situation is good it will take 15 days and if the political situation gets worst it may take 30 days
PERT= O+4M+P/6 =; 15 + 4(20) + 30 /6 =; 15+80+30/6 =; 125/6 = 20.83 The Result is near to the confident CEO decision
SD= E-O/6 =; 20.8-15/6 =; 5.8/6 =; 0.966 As result we have done a good calculation because standard deviation is lower than 1
Activity Classification
Value Added Activity
Online Reservation Dispatcher Maintenance and repair service
5min 5min 30min
Non Value Added Activity
Caller tone while connecting to dispatcher Payment billing process
2min 30sec
Efficency (process) = VAT/Throughput time=; 5+5+30/5+5+30+2+0.30= 0.94*100=94% (Good calculation, Only 6% is spent on Non Value added activity)
Risk Classification
Assume that two Taxis have problem in machine and some parts need to be replaced if not there is a 30% chances that we will face a loss of AFS 20000 by the next month, We have the following options in order to reduce the risk.
Parts needed Risk Probability Percentage Costs (AFS)
1 Purchase from local Second hand market 20% AFS 4000
2 Import from Toyota workshop 5% AFS 14000
1:
Do nothing = AFS 20000 Risk exposure0 =; 20000*30% Risk Exposure1 =; 20000*20% New Investment = AFS 4000 RLRR = R0 – R1 / NI =; 6000-4000/4000 =; 0.5*100 = 50%
2:
Do Nothing = AFS 20000 Risk exposure =; 20000*30% Risk Exposure1 =; 20000*5% a New Investment = AFS 14000 RLRR = R0 – R1 / NI =; 6000-1000/14000 =; 0.3571*100 =36%
As a project manager I choose the 1st solution because the risk reduction Ratio is higher than the Second solution
Project Logical Frame Work
Objective Indicator Means of Verification Assumption
Provide safe, Reliable, Timely Cab Services Outputs
1: Project Document is Drafted
2: Number of Taxis Purchased
3: Number of Parking lot purchased
4: Number of Drivers Hired
5: No. of Maintenance and Repair Center Deal 1:Project signed by Investers
2: physical Count
3: physical Count
4: list of drivers registered
1:Check documents
2: More money is spent
3: Sight Visit
4: Reports
1: if all parties are available
2: If fund is available
3: If fund is available
4: if there are avaible cars for them
Outcome
1: Percentage of Sales Increased/Decreased
2: Taxi service is extended to Heart, Mazar provinces
3: Physical Cash Reduced 1: compared to last month
2: More Money is spent
3: No. of Credit payments in sales Reports 1: Sales of this month minus sales of month before
2: Sight Visit
3: Credit card payments 1: If Reports are made correctly
2: If security condition remains Good
3:If Banks give us 5% of each Transaction
Impact
1: Road Incident Reduced
2: Green Envoirnment
3: Percentage of Unemployment Reduced
4: Percentage of Kidnaps Reduced 1: No. of Traffic Reports Published
2: CSR
3: No. of Reports published by ministry of work
4: No. Reports Conveyed by Kabul police department 1: No. of interviews Conveyed in Kabul traffic Department
2: No. of Trees Supplied for municipality
3: No. of employees Hired
4: Interview with AB. Rahman (head of Kabul police department ) 1: If traffic lights are there in streets
2: If Government Support us
3: If they are trained well
4: If there is Reliable and trustworthy Drivers
Cost Variance, CPI, SV, SPI
Mr. Mohib is the project manager of the Kabul taxi Co. We need AFS 27,200,000 for purchasing 50 cars (Corolla 2005 ) for taxi in 20 days, after 8 days of this project manager reviews the cost and finds that AFS 12,376,000 is spent while he planned AFS 14,144,000 and 52% of work is done.
Project Total cost ( BAC ) = AFS 27,200,000 Planned Duration = 20 Days After 8 Days planned cost = AFS 14,144,000 , Actual cost = AFS 12,376,000 ; EV ? EV= %WC*BAC =; 52% * AFS 27,200,000 = 14,144,000
CV (Cost Variance) =EV – AC =; 14,144,000-12,376,000 = 1,768,000 (Positive Result= Under Budget) CPI (Cost Performance Index) = EV/AC = 1.14
SV (Schedule Variance) = EV-PC =; 14,144,000 – 14,144,000 =0 (This Project will be Finished on time) SPI (Schedule Performance Index) = EV/PC =; 14,144,000/14,144,000 =1
Formal Plan Duration = PD/SPI =; 20/1 = 20 (Project will be finished in 20 days as its planned)
(PC, EV)
-68580264430 (AC)
AFS 30m
AFS 25m
AFS 20m
AFS 15m
AFS 10m
AFS 5m
0
1 2 3 4 5 6 7 8 9 10
Uneven Pay Back Method
After 3 years of service in Kabul, Kabul taxi want to go extend their services to Mazar-e-Sharif and need for AFS 10,880,000 to start the project, the project lifetime is 3 years and the expect the result will be much more similar to Kabul as following:
Y1: AFS 3,500,000 Y2: AFS 5,000,000 Y3: AFS 6,000,000
Cash inflow Accumulative Cash inflow
0 AFS (10,880,000) AFS (10,880,000)
1 AFS 3,500,000 AFS (7,380,000)
2 AFS 5,000,000 AFS (2,380,000)
3 AFS 6,000,000 AFS 3,620,000
Pbune = A+B/C =; 2+2,380,000/6,000,000 = 2,39 ~ 2,40yrs
It will take 2,4 years to recover AFS 10,880,000
Net Present Value
Assume the Investor want to predict the profitability of the taxi project in mazar e sharif provice which requires about AFS 10,880,000 which is lifetime is 3 years and it seems to generate revenues of AFS 3,500,000 at first year and AFS 5,000,000 at second year and AFS 6,000,000 at third year and Kabul taxi cost of capital is 10% while the AFS of today is not equal to AFS of three years later.
-10,880,000 + 3,500,000/1.1 + 5,000,000/(1.1)2 + 6,000,000/(1.1)3 =; -10,880,000+3,181,818+4,132,231+4,507,888 = AFS 11,821,937
NPV is acceptable because it is greater than 0,
