SAP Inc.’s Virtual Private Network Project Management

Allocation of Resources to the Project Tasks

Allocation of resources is critical in the commencement of the project because it enables the comprehensive development of the project. Given that resources are limited, the allocation of resources is important because it optimizes the use of available resources in project management (Schwalbe, 2010). Poor allocation of resources normally results in wastage of resources because the limited resources may be allocated to non-priority tasks, which consequently lead to the stalling of projects.

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Allocation of resources will ensure that different tasks of the project get commensurate resources that are sufficient for the project to commence and develop within the stipulated time and budget. Schwalbe (2010) advises project managers to allocate resources diligently because haphazard allocation has detrimental effects on the development of projects. Hence, resource allocation is a critical aspect of project management because it guides the project managers and allows them to project budget and time needed for the completion of projects.

In the commencement and development of the VPN project by SAP Inc, the project managers need to allocate resources to different tasks according to their priorities and sizes. Given that physical infrastructure hosts other tasks, the project managers should allocate ample resources to buildings and structures that would host other tasks of the VPN project. Moreover, the project managers should allocate enough resources to computer hardware and related network because they comprise the IT infrastructure of the VPN project.

Schwalbe (2010) argues that infrastructure is the backbone of a project, and thus project managers have to prioritize it when allocating resources. Other tasks that require resource allocation in the VPN network are the acquisition of software and the Internet. Given that human resources are indispensable in the functioning of the VPN project, the project managers need to allocate resources for hiring and training employees.

Costs Estimates for the Project Resources

Estimation of resources that a project requires is necessary for budgeting. The estimation of resources allows project managers to determine the number of resources that the project demands its completion. Given that a poor estimation of resources would lead to stalling of projects, project managers should be very cautious when estimating the cost of resources. Schwalbe (2010) states that rough order magnitude (ROM) estimate, budgetary estimate, and definitive estimate are three ways of estimating the cost in projects.

ROM estimate enables project managers to get a rough figure of the cost of resources several years before the completion of the project and is about 50-100% accurate. A budgetary estimate is applicable in the allocation of resources because it is more accurate than the ROM estimate because it has an accuracy of 10-25%. The definitive estimate has an accuracy of 5-10%, and thus applicable in purchasing resources and tendering. Therefore, the VPN project will apply the budgetary estimate and definitive estimate in estimating the cost of recourses necessary to establish the project.

The direct costs are the major costs of the VPN project because they take a significant amount of resources allocated to the project. The direct cost includes the cost necessary to construct the infrastructure of the project. Schwalbe (2010) asserts that direct costs are costs that project managers can trace or attribute their use to specific tasks. In this case, the direct costs are the costs of building, computers, network materials, software, and networking. Moreover, other direct costs are the costs incurred in training of employees. Other costs such as the cost of electricity, salaries, license, and the cost of the Internet are some of the fixed costs, which are recurrent.

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Tasks Costs
Direct costs
Building and construction $200,000
Computers $20,000
Network materials $10,000
Networking $4,000
Software $10,000
Training of employees $10,000
General and Administrative costs
Salaries $2,000
Electricity $100
License $200
The Internet $150
Total $256,450

Gantt Diagram Showing Duration Estimates for All Tasks

The Gantt diagram below depicts the duration taken by each of the project tasks and further illustrates the sequence of tasks. Building and construction is a huge task that takes an estimated period of six months. Given that all tasks are dependent on construction, they will wait until six months elapse. Tasks such as purchasing networking materials, computers, and the software will be done concurrently within a period of one month. Networking of the project will take a period of two months in which the Internet connection will be performed in the last month. Ultimately, hiring of employees follows in the next one month followed by a training period of two months. Overall, the tasks cover a period of 11 months during which the project managers complete the project.

Gantt Diagram Showing Duration Estimates for All Tasks

Baseline Plan for the Project

As a baseline plan, the project will entail the construction of a building that is worth $200,000, which is the main infrastructure of the project. Purchasing of computers, software, networking materials, and training of employees will be done at the total cost of $54,000. General and administrative experiences will cost about $2,450. The project managers estimate that the project will cost about $256,450, and will be completed within a period of 11 months.


Schwalbe, K. (2010). Information Technology Project Management (6th ed.) New York, NY: Cengage Learning.

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