Cost-Based Analysis

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Cost-Based Analysis

CBA代写 The choice of the model to adopt will depend on the cost-benefit analysis of the model as well as the comparison between the models.

 

Description of the CBA

SwinX intends to expand its business and hence, will impact its structure and operations. The company has few options, that is to maintain the current architecture, infrastructure, and building office setup model and adopt a hot-desking and bring your device policy; keep the existing architecture, infrastructure, and building office setup model for all location or implement a hot-desking and BYOD plan for both locations. The choice of the model to adopt will depend on the cost-benefit analysis of the model as well as the comparison between the models. The model that will cost less but yield more benefits will be adopted for implementation in both locations. CBA代写**成品

Therefore, the company needs to conduct a cost-based analysis of the three options.  CBA代写

It is a process that businesses measure decisions regarding their net present value and a discounted value of cost and benefits. In this case, the cost of implementing each option will be analyzed then compared with gains likely to be derived from these options. The analysis will find, quantify, and add all the positive factors. These are the benefits of each option. They will then be subtracted from all the negative, the costs. The differences indicate which of the three options is advisable to adopt. In so doing, the report will start by identifying and describing the costs and then the benefits. The analysis of both the cost and benefits of all options will be conducted to assist offer recommendations to SwinX management.

Assumption of CBA  CBA代写

The success of CBA is vested in some fundamental assumptions. The number of employees in the current tenure will not change and that the intended recruitment will be successful, and thus the labor cost, training, and management costs will not be factored. Hence, the cost of employees both current and after recruitment will not be put into consideration. The cost of an ID photo and swiping card will not be included since it is incurred in all options. All the qualitative variables will be assigned money value relative to their benefits or cost to the company. It will ensure the analysis focuses on the objective.

Identification and Description of the Costs  CBA代写

The costs considered include the three models that the company has to take. Each of the models will be described and analyzed separately.

OPT1

The company has the option of keeping the current architecture, infrastructure, and building an office setup model for Hawthorn and implementing a hot-desking and BYOD policy for the staff deployed at the new Burnley office. The cost is incurred include:

A. Current structure and office model  CBA代写

i. Current office costs

The cost of maintaining one staff per private office:

a. 6 * 6 private office space at $15,000 per year ($450,000 for all employees)

b. 27-inch LCD monitor at $ 200 ($ 6,000 for all employees)

c. Laptop docking station at $ 200 ($ 6,000 for all employees)

d. Cisco phone $7,495 (224,850 for all employees)

e. HP Spectre laptop at $ 1,900 ($ 57,000 for all employees)

f. Office 360 at $ 100 for five employees that is $ 20 each ($ 600 for all employees)

g. iPhone XRs for $ 1000 each ($ 30,000 for all employees)

h. Basic Amazon Web Service (AWS) Cloud platform at $ 2350 per year for all employees

i. Printing cost per employee is $125 per year ($ 3,750 for all employees)

j. Cost of providing the kitchen Kiosk is $250 per employee per year ($ 7,500 for all employees)

All the costs are calculated for each employee except for Amazon cloud servers that are used by all employees and Office 260 that is shared by five employees. These will be apportioned according to the number of users. Therefore, the total cost of the office model is $ 788,050.  CBA代写**成品

B. The new structure and office model  CBA代写

ii. Procuring the hot-desking for the new location

Typically, a coworking space can be priced per month, but the actual cost varies massively depending on the number of factors (Constable, 2019). Therefore, it is impossible to say precisely how much coworking can cost in this scenario. However, the average cost can be predicted depending on other factors in the office. In this case, it is estimated to be $ 200,000 per year.

iii. Acquiring the new office space at Burnley

The office space needed for 15 staff over 250m2 which costs approximately $ 6,000.

iv. Increased information technology resources need

CBA代写
CBA代写

The adoption of co-wording requires the installation of shared IT infrastructure and includes the internet. A good internet speed costs $1000 per year. The office also needs routers and power cables at a cost of $200. The total IT system costs $1200.  CBA代写**成品

v. Health and safety of employees with particular needs

The office needs to be installed with health and safety equipment, individual seats, and other amenities which can cost $500.

i. Staff resentment of disruption to the office hierarchy and decline in employee morale

According to Christou (2018), hot-desking has negative psychological impacts on employees. It reduces employee personal space, and those in management feel open to their juniors. Only 47 percent of employees were found to support co-working. Most employees think they do not have the space to personalize their working space. The cost is the reduced performance which can be quantified to be $54,000 per year. CBA代写**成品

The total cost for OPT1 is equal to $1,049,750.

OPT2  CBA代写

The second option seeks to keep the current model for both Innovation Precinct and Burnley. The cost for the current model will be apportioned as in OPT1 above. The second location will hold 15 staff. The number of staff represent half those of Innovation Precinct. Since the current model will be replicated for 15 staff in Burnley, the total cost will be approximately half that of the current office model, that is, $ 788,050/2 = $394,025. Therefore, the total cost for OPT2 is 788,050 + 394,025 = $1,182,075.

OPT3

The company intends to implement a hot-desking and BYOD policy for both locations. The costs to be incurred in this option are calculated in OPT1. Therefore, it will be as follows:

A. Current location  CBA代写

The current location needs restructuring to make it suitable for the new infrastructure. Thus, to install hot-desking and BYOD, the existing office structure should be removed at $1000. Others include:

i. Procuring new hot-desking at the cost of $400,000

ii. Acquiring and restructuring of IT infrastructure at $2000

iii. Staff resentment of disruption to the office hierarchy and decline in employee morale at $100,000 per year.

iv. Health and safety of employees with particular needs at $1000

B. New location

All the costs in OPT1 (B) for the new office model apply here. Therefore, the total cost will be $261,700.

The total cost of implementing OPT3 is $764,700.

Identification and Description of the Benefits  CBA代写

OPT1

A. Keeping the current model

i. The benefit of not disrupting the work at $1000

ii. Increased employee morale and motivation to work $100,000

iii. Increase in productivity $60,000

B. Adapting hot-desking in the new location

The benefits of the hot-desking lie in the increased levels of communication and improved professional relationships (Huang, 2019). When people sit and work alongside different people every day, they increase bonding across the wider business and hence give workers chances to understand people’s skillsets and responsibilities. CBA代写**成品  These benefits can be quantified to have monetary value in the following ways:

i. Low cost of office operations and equipment at $400,000

ii. Improved communication and professionalism at $200,000

iii. BYOD policy at $250,000

iv. Proper utilization of office space at $100,000

The total benefit of implementing OPT1 is $1,111,000.

OPT2  CBA代写

A. Keeping the current model

iv. The benefit of not disrupting the work at $1000

v. Increased employee morale and motivation to work $100,000

iv. Increase in productivity $60,000

B. Keep the current model in the new location

i. Employee morale and satisfaction at $80,000

ii. Higher productivity at $35,000

iii. Easy implementation and management will save $100,000

The total benefits for implementing OPT2 is $376,000

CBA代写
CBA代写

OPT3  CBA代写

A. Current location

i. Low cost of office operations and equipment at $600,000

ii. Improved communication and professionalism at $350,000

iii. BYOD policy at $500,000

iv. Proper utilization of office space at $200,000

B. New location

i. Low cost of office operations and equipment at $400,000

ii. Improved communication and professionalism at $200,000

iii. BYOD policy at $250,000

iv. Proper utilization of office space at $100,000

The total benefit of implementing OPT3 is $2,600,000.

Analysis  CBA代写

Costs

The total cost for OPT1 is equal to $1,049,750.

The total cost for OPT2 is 788,050 + 394,025 = $1,182,075.

The total cost of implementing OPT3 is $764,700.

Benefits  CBA代写

The total benefit of implementing OPT1 is $1,111,000.

The total benefits for implementing OPT2 is $376,000

The full gain in implementing OPT3 is $2,600,000.

The lowest benefits are derived when the company maintains the office and operations models in both locations (Innovation Precinct and Burnley). The benefits increase as the company adopts hot-desking and BYOD policy in OPT1. The highest benefits are derived from OPT3. On the other hand, the highest costs are incurred in OPT2. The costs reduce as the company adopts hot-desking and BYOD policy in OPT2 with the lowest born in OPT3.

Preferred Recommendation to SwinX Management  CBA代写

The company has three options. The analysis conducted has helped in determining whether the options will have positive or negative consequences. Therefore, the company will make the decision that has the lowest costs and highest benefits. According to the analysis, OPT3 has the most economical price of $764,700 and the most top benefits of $2,600,000. Therefore, should SwinX management implement IPT3, the company will get a surplus of $1,835,300.  CBA代写**成品

On the other hand, if the company chooses any of OPT2 or OPT2, it will not realize the full benefits of its expansion.

References  CBA代写

Constable, S., 2019. How hot-desking will kill your company. Forbes. Available from https://www.forbes.com/sites/simonconstable/2019/06/20/how-hot-desking-will-kill-your-company/#60ddbfe832e9

Christou, L., 2018. The effectiveness of hot-desking: Is this the future of the workplace? Available from https://www.verdict.co.uk/effectiveness-of-hot-desking/

Huang, Y., 2019. Coworking space prices. Available from https://www.coworkingresources.org/blog/coworking-space-prices

 

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