A Project Plan for P2P Blues

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Presented to the
Ateneo de Manila University
John Gokongwei School of Management
Department of Quantitative Methods and Information Technology

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In Partial Fulfilment
of the Requirements for the Final Project in
POM 199.2 - X | PROJECT MANAGEMENT FUNDAMENTALS

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Barcena, Johan Derrick

Rueda, Nicholas Francis
Sy, Matthew Bentley
Sy, Matthew Christian
Team JoNiMaMa

December 6, 2018

Mr. Vicente Reventar III

COURSE INSTRUCTOR
Table of Contents
Executive Summary ...................................................................................................................... 1
Project Description ....................................................................................................................... 2
Project Objectives......................................................................................................................... 2
Project Scope ............................................................................................................................... 3
Project Deliverables ...................................................................................................................... 3
Project Assumptions ..................................................................................................................... 3
Project Team Organization ............................................................................................................ 4
Project Stakeholders ..................................................................................................................... 6
Project Milestones ........................................................................................................................ 7
Gantt Chart ............................................................................................................................... 7
PERT-CPM .............................................................................................................................. 8
Work Breakdown Structure ........................................................................................................... 9
Project Financials with Assumptions ............................................................................................ 10
Cost Benefit Analysis ................................................................................................................. 12
Risk Assessment ......................................................................................................................... 13
Appendix ................................................................................................................................... 16
Mobile App Features ............................................................................................................... 16
Employee Costing ................................................................................................................... 17
Bus Ticket Matrix ................................................................................................................... 18
Bus Schedule .......................................................................................................................... 19
Cost Benefit Analysis Line Graph {Purchasing a Bus [LEFT]} {Renting a Bus [RIGHT]} .......... 19
Bus Model and Specifications .................................................................................................. 20
Project Approval ........................................................................................................................ 21
 Executive Summary

The team aims to solve the long standing problem of the difficulty and hassle of

students traveling to AdMU from the south. The solution being proposed is a P2P bus system

with several routes catering mostly to these distant areas in the south. The P2P system is a

transit-system that does not make any stops at all during the journey because of this it can

travel more efficiently and allow for a smooth more comfortable ride than a regular bus. The

project will involve the research of routes, purchasing of P2P buses, and the creation of an

application to help track the availabilities of the bus. The team will be composed of five

managers, namely the Operations, Marketing, HR, IT, and Finance heads. They will be the

direct point persons of the project to the stakeholders like the government, the university, the

students, and indirectly to other alternative modes of transportation like grab/angkas to any

other traditional modes of transportation. The company’s biggest expense would be the

acquisition of the many buses and the goal is to profit mainly on ticket sales. With all risks

considered, the company seeks to be profitable by the 5th year of operations.

[1]
Project Description

Ateneo de Manila University is one of the most sought-out universities here in Metro
Manila and people would go all their way to go and study even if they would have to travel
for a long time. It isn’t an easy task, but people would still go their way and brave the
distance. However, especially to those who live far from Ateneo, commuting becomes a
harder task thanks to the growing traffic volumes especially during rush hours. One solution
to ease the situation is to introduce a point-to-point commuting system (P2P). The P2P system
is a transit-system that does not make any stops at all during the journey. It is also a
comfortable mode of transportation which eases the commuter’s journey.

Introducing the system will help mitigate the hassle of commuting to Ateneo for the
Ateneo faculty, staff, and, students. Routes will be plotted out in high-density areas from
southern Metro Manila and will have scheduled departures from said locations to Ateneo and
vice-versa that will be placed in the morning and late-afternoon to evening respectively. E-
buses would be used as they can accommodate a volume of passengers. This service will give
the Ateneo community an easier and safer experience of going to Ateneo and it may also be
open to the public if it can potentially help out more people.

Project Objectives

The goal of this P2P project is to

I. Create a centralized system of transportation for students & staff residing

within the south area in need of transportation to Ateneo campus.
II. Provide for a possible alternative to costly individual transportation to and
from the specified locations.
III. Promote environmental friendly transportation system that can also alleviate
some of the commuters who are or might be vexed with the MRT/LRT
system/traffic
IV. Create an app that will provide relevant information to users regarding the
status of their e-bus so that they will be well-informed (and not fret about
delays etc.).
V. To collect and analyse customer feedback then implementing the necessary
changes (for the first year of operations)

[2]
Project Scope

1. The project takes one year to implement (that will be catered to the Loyola
Schools Community. The first phase (around 1-2 years after project ended)
will only implement the P2P system in the Ateneo community, then if proven
successful, we will expand the P2P system for the use of the general public
2. The additional bus stations are preferably from the South (Paranaque, Las
Piñas, Cavite) but also in other areas where most Ateneans reside (possibly in
Marikina and some parts of Rizal)
3. Partnerships will be forged between P2P Blues and the Loyola Schools also
to be partially funded by the latter.
4. A mobile app will also be created to cater to the Loyola Schools users on the
location of their e-buses as well as determine the time for the next bus to
arrive and depart as well as payment mode online or manual (with ticket
booking instructions and process).

Project Deliverables

1. Create a survey to gain insight on potential users of the system that will focus
on students, staff, and faculty
2. Gather list of current P2P routes
3. Consider 10 P2P routes and multiple schedules
4. Buy around 22 E-Buses
5. Create an application to complement the P2P service
6. Project Pitch to Loyola Schools Administration

Project Assumptions

A. The P2P system would cater initially only to the Loyola Community of the
Ateneo de Manila University. Some years after the payback period has been
reached will the P2P be opened to the entire public.
B. The P2P Blues App can accept either online or manual payment by paying
the ticket fees directly to the drivers of the buses or through the app itself.

[3]
Project Team Organization

Project Head Project

Manager

Managerial Marketing
Manager
Finance
manager
Operations
Manager
Data Analysts HR Manager IT Manager

Public
Associates Liaison
Officers
Relations
Officers
Accountants
Operations
Associates
HR Associates Technicians
App
Developers

The project manager will be responsible for overseeing the entire project. He/she will schedule the entire project’s budget, time and resources
(manpower) in order to meet the deadlines and the possible emergency risks that might occur within the duration of the project.

[4]
 The marketing manager will be responsible for coordinating with other companies
on placing their ads on the P2P Blues Buses and Apps. He/she will also pitch the project to
the stakeholders/benefactors of the entire P2P project. He/she will be in charge of reaching
out to potential customers, he/she must be able to present the service and educate customers
about the routes and the convenience of the service. The main role is to draw in customers
and help drive sales.

The finance manager will determine the cost benefit analysis of the P2P system by
determining if renting or purchasing the bus is the most profitable and feasible plan at the
moment and into the future. He/she will also coordinate with the operations team regarding
which bus to procure and the cost and profit computations of the routes that will be used. The
financial manager will also oversee the construction of alternative financial plan as
contingency measures. He/she will be in charge of setting the budget for the project, all
purchases and disbursements will go through him/her. The management of all current assets
will be handled by him/her.

The operations manager will utilize the data given by the data analytics team of
consultants to come up with the routes for the P2P system. He/she will also determine which
bus to procure by looking at the specifications and costs (with the finance team) and how
many buses to procure (also to be brainstormed with the financial team). He/she will be in
charge of ensuring that the entire service is running properly, he/she checks if the buses are
running and if they are arriving on time.

The data analytics consultants will be responsible for conducting the feasibility study
of the project by coming up with the appropriate surveys. They will also collect and analyse
the data and afterwards will provide these analyses to the operations team for further study
and finalization of the number of buses to procure and the number of routes to use.

The human resources manager will be responsible for the hiring of employees and
will also calculate the employee’s salaries together with the finance team. He/she will be in
charge of supervising the payroll, benefits, and behavior of all other employees. He/she must
settle any disputes and ensure that the employees are having a productive and positive
experience.

The information technology manager will oversee the creation of the mobile app for
P2P from its initial design template until its beta testing and launch of the app. He/she will
also be crafting the application and any supplementary software that will help the service run
smoothly and more efficiently.

The associate employees of the different functions (except for the data analytics team
as they are purely composed of outsourced consultants) will be responsible in aiding their
respective managers for the tasks and roles that are assigned to their team in preparation for
the project.

[5]
Project Stakeholders

Government (Department of Transportation) will be integral in the success of this project

because the approval of required permits to begin servicing in the Philippines is contingent on
them. Without the necessary permits, the business will not be allowed to run. Aside from this,
the government is a viable source of partnership/financial support as the project aims to
provide more accessible commute routes for commuters within the scope of the project. In
terms of the potential partnership, the government can be a viable source of research data to
improve upon the business.

Alternative Public Forms of Transportation (Jeepneys, MRT, & LRT) will have to be
taken into consideration in the creation of this project because of how the current commuting
population rely on these modes of transportation. In addition to this, the routes we plan to add
in the execution of this project will affect the current viability of the project.

Alternative Private Forms of Transportation will have to be taken into consideration as

well because the project will attempt to cater to several socioeconomic classes in the
Philippines. These private forms of transportation include companies such as Grab, Angkas,
and many more.

Commuters are the integral stakeholders of the project because factors such as the viability
of routes, prices, and other factors will revolve around the target market of this business.
Based on the feedback of the commuters, the business will have to adapt in order to improve
our overall success in the market.

Third Party Donors/Partners will ensure that there is enough financial capital for the
research, trial phase, and execution of the project. Their support is integral to the viability of
the project.

Ateneo de Manila University will also serve as one of the principle sponsors of the project.
Taking into consideration that the project started with students as the priority, Ateneo will be
the source of viable research points and the monetary value in order to execute the project.

Bus Rental Company will serve as the main partner company that our project will be
sourcing the busses from. Our business viability will be contingent on their quality of the
busses, and at the same time, the prices which they offer their busses for.

[6]
Project Milestones

Gantt Chart

[7]
PERT-CPM

[8]
Work Breakdown Structure

Project Manager

Marketing Finance Operations Data HR IT

Manager Manager Manager Analytics
Manager Manager
Determine costs
Coordinate with
Company for
of bus Create Survey
renting/bus Routes Distribution
Ads Display
purchasing
Hire Design App
Pitch to LS Employees Template
Coordinate with
Admin with Determine
other
Operations Collect Data
team Bus Specs
stakeholders
Determine
App Test
Create Employee
Alternatives Procure Bus and Launch
(Financial Plan) Salary

[9]
Project Financials with Assumptions

The assumptions for the project are as follows:

a. One dollar is converted to fifty-three pesos
b. The hurdle rate is fifteen percent
c. There are 22 P2P buses to be operated and each bus contains 50 seats and there are 44 drivers and 2 shifts (morning &
afternoon; drivers are split into the two shifts) (for the purchasing only) (The renting part only concerns on renting costs)
d. The average ticket price with 250% increase commission for the bus ticket sales (for purchasing) and 270% for renting
e. Salaries and Benefits are computed based on the current average salaries of the different positions.
f. Bus maintenance includes gasoline, repair & cleaning fees
g. One year is three hundred sixty-five days or twelve months; One working day is eight working hours
h. The bus drivers’ salaries include the forty percent benefits (SSS, PAG-IBIG, PhilHealth etc.)

[10]
 Displayed above is the projected expense and revenue for purchasing twenty-two buses. The payback period is estimated to be after 3.62
years and the internal rate of return (without net present value) is around twenty-six percent and ten percent with net present value.

Displayed above is the projected expense and revenue for renting twenty-two buses. The payback period is estimated to be after 3.16 years
and the internal rate of return (without net present value) is around thirty-one percent and fourteen percent with net present value.

Comparing the two methods of procuring buses and with the same revenues, it can be observed that renting a bus yields a bit more profit
than purchasing yet renting a bus can be a bit more expensive since the owner of the bus would want to earn and has considered all the costs of
purchasing and maintain a bus and would put up a considerable percentage of mark-up. Nevertheless, it is up to the Loyola Administration whether
to procure buses by purchasing or renting. Our advice is that the Loyola P2P Blues should first rent out buses to avoid spending more time in hiring
drivers and since purchasing buses requires high amount of initial budget as compared to renting. After some years have elapsed (e.g. five years after
the payback period) the administration, assuming that it has earned considerable amount of money can start to purchase buses to lessen costs in the
long run (but also depending on several factors such as oil price, maintenance fees, driver salaries and inflation rates).

[11]
 Cost Benefit Analysis

Bus Price = ₱4,000,000 × 22 buses = ₱88,000,000.00

Maintenance = $1,550 × ₱53/$ × 22 buses + ₱40/L/km/day × ₱28L/km × 22 buses × 365 days/year
Maintenance = ₱10,800,900.00
Driver Salary = ₱12,000 per month × 12 months per year × 140% (benefits) × 44 drivers = ₱8,870,400.00
Depreciation = ₱4,000,000 per bus ÷ 10 years (straight line depreciation) × 22 buses = ₱8,800,000.00
IT Implementation Costs initial = $28,000 × ₱53/$ = ₱1,484,000.00
IT Implementation Costs maintain = ₱1,484,000 × 20% = ₱296,800.00
Employee’s Salaries and Benefits = ₱10,796,386.00 (salaries) + ₱4,318,554.40 (benefits) = ₱15,114,940.00
Bus Ticket Sales = 50 seats per bus × 65% occupancy rate × 22 buses × 365 days per year × ₱105.63 per day × 250% (sales)
Bus Ticket Sales = ₱62,022,339.84
Bus/App Ads = ₱6,000 per month × 12 months per year × 22 buses + $400 per month × ₱53/$ × 12 months per year
Bus/App Ads = ₱1,838,400.00

Bus Rental Fee = ₱7,500/day × 365 days/year × 22 buses = ₱60,225,000.00

IT Implementation Costs initial = $28,000 × ₱53/$ = ₱1,484,000.00
IT Implementation Costs maintain = ₱1,484,000 × 20% = ₱296,800.00
Employee’s Salaries and Benefits = ₱10,796,386.00 (salaries) + ₱4,318,554.40 (benefits) = ₱15,114,940.00
Bus Ticket Sales = 50 seats per bus × 65% occupancy rate × 22 buses × 365 days per year × ₱105.63 per day × 270% (sales)
Bus Ticket Sales = ₱74,426,807.81
Bus/App Ads = ₱6,000 per month × 12 months per year × 22 buses + $400 per month × ₱53/$ × 12 months per year
Bus/App Ads = ₱1,838,400.00

[12]
Risk Assessment

Attached below are the potential risks associated in the execution of the project. The severity of the impact of the risks on the project & their
likelihood of occurrence are summarized on a scale from 1-10 with 10 being the highest.

Table 1. Risk Assessment Summary

Severity Occurrence
Failure Mode Effect of Failure Priority Number
(1-10) (1-10)

Lack of support Without the support of the government, the

from the project will rely more on its third-party donors 5 7 35
government and Ateneo to fund the research activities.

Will delay project research, testing, and

Natural Disasters 3 5 15
execution.

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Price of Bus Rental Will result in the project reassessing budget, and
5 7 35
Increases will cause delays in the execution of the project

Lack of Monetary
Support from Lessen the viability of the project. Will result in
Third-party the project having the cut costs or find alternative 6 6 36
companies or sources of starting capital.
Ateneo

Rejection of
Business will not be allowed to function 10 3 30
Business Permit

Increase of Gas Will overall increase the difficulty of launching

7 6 42
Prices the project.

[14]
Lack of support from the government refers to the non-cooperation of the government in
providing insightful research into the improvement of the project. It also refers to the
provision of monetary support to the project. Without the proper support from the
government, the project will not be as efficient in the selection of viable routes. At the same
time, the project will have to rely more on the support of other sources of starting capital for
the research and testing of the project.

Natural Disasters poses as one of the possible risks of the project because of how common its
occurrence in the Philippines is. At the same time, the natural disasters are not within the
control of the stakeholders in the company which results to delays and many more issues.

Price Increases of Buses is one of the priority risks to mitigate since the rental of the busses
is our main avenue to the procurement of busses for our services. The increase of prices will
entail the project team to re-evaluate other options in the procurement of buses.

Lack of Monetary Support from Third-Party Companies or AdMU is the second highest risk
to mitigate because the project is contingent of the support of these stakeholders. The project
in itself requires a large amount of starting capital. Without the support of these companies,
the project will either have to search for alternative ways to cut costs, other potential partners,
or re-evaluate overall the viability of the project.

Rejection of the Business Permit will result in the project being unable to proceed. Taking in
the consideration the business landscape in the Philippines, companies such as Uber that had
difficulty in receiving approval for their drivers which resulted in their eventual withdrawal in
the Philippines. However, this is not a priority because of the low likelihood of this risk
occurring.

Increase of Gas Prices will affect overall the prices of transportation. With this, the project
will have a greater difficulty in supporting its efforts in launching the execution. Aside from
this, more monetary value will have to be shelled out in order to support the business model.
This is the highest-ranking risk that has to be mitigated because of the current Philippine
landscape. Currently, the prices of gas in the Philippines has fluctuated from 54 pesos as of
August 2018 and has went as high as 60.87 pesos on October 15, 2018. With the instability of
gas prices, the overall business model will be affected.

[15]
Appendix

Mobile App Features

[16]
Employee Costing

Employee Salary Computations

Marketing Manager = ₱200/hour × 8 hours/day × 365 days/year × 1 person = ₱584,000.00
Finance Officer = ₱925,609/year × 1 person = ₱925,609.00
Operations Officer = ₱732,503/year × 1 person = ₱732,503.00
HR Manager = ₱124/hour × 8 hours/day × 365 days/year × 1 person = ₱362,080.00
IT Manager = ₱697,814/year × 1 person = ₱697,814.00
Employees (assigned to different managers) = ₱374,719/year × 20 persons = ₱7,494,380.00

[17]
 Employee Benefits Computations

Marketing Manager = ₱584,000 × 40% (benefits) = ₱233,600.00

Finance Officer = ₱925,609 × 40% (benefits) = ₱370,243.00
Operations Officer = ₱732,503 × 40% (benefits) = ₱293,001.20
HR Manager = ₱362,080 × 40% (benefits) = ₱144,832.00
IT Manager = ₱697,814 × 40% (benefits) = ₱279,125.60
Employees (assigned to different managers) = ₱7,494,380 × 40% (benefits) = ₱2,997,752.00

Bus Ticket Matrix

14 is the average distance (expressed in kilometres). Assumption is one litre per one kilometre.
The prices listed here are base prices from Ateneo de Manila University to X and vice versa.
The round trip base price is 1.5 times the price for single journey tickets
Average price of single journey ticket is ₱84.50
Average price of round trip ticket is ₱126.75
The average ticket price of both single journey and round trip journey is ₱105.63

[18]
Bus Schedule

Cost Benefit Analysis Line Graph {Purchasing a Bus [LEFT]} {Renting a Bus [RIGHT]}

Payback Period Illustration Payback Period Illustration

250000000 300000000
NPV Values (in PHP)

NPV Values (in PHP)

200000000 250000000
150000000 200000000
150000000
100000000
100000000
50000000 50000000
0 0
YearYear
0 Year
1 Year
2 Year
3 Year
4 5 YearYear
0 Year
1 Year
2 Year
3 Year
4 5
NPV Costs Cumulative Years
NPV Gross Cumulative NPV Cumulative Costs Years
NPV Cumulative Gross

[19]
Bus Model and Specifications

[20]
Project Approval

We have read the proposed plan and will abide by its terms and conditions and pledge
our full commitment and support for the new P2P system.

Project Sponsor:

Fr. Jett T. Villarin, S.J.

President
Ateneo de Manila University

[21]