RICEF-classification of developments and settings for estimating labor costs

RICEF-classification of developments and settings for estimating labor costs

The implementation of almost any ERP system requires both its adjustment and refinement. An important place in the course of implementation is given to software updates, which occupy the lion’s share of the project, compared to customization activities. The success of the ERP project depends on how you correctly approach the planning and implementation of improvements. According to the statistics of implementation projects, more than 40% of the business needs of users require software refinement, therefore, high-quality planning of work on the project is unthinkable without a unified approach to estimating planned labor costs for implementation. [1]. In connection with this, in this article I would like to touch on the issue of the planned assessment of labor costs of improvements and adjustments of the corporate information system.

Let’s start with the basics: the customer’s needs in the information system are covered either by its refinement or customization, or are already implemented and do not require additional efforts. The first two results specify the Gap area, the last one – Fit (Fig. 1). All developments in the Gap area can be classified according to the RICEFS approach [2], which is an abbreviation of the English words: Report, Interface, Conversion, Enhancement, Form and S (report, interface, data processing program, extension, printed form and setting). By entering the term of complexity (low, medium, high and very high), you can build an elementary estimator (from the English Estimate, to evaluate) [3]. In it, for each “Type of development – complexity” pair, the planned labor costs for the design and development stages are empirically determined, that is, the resources of functional consultants in the design phase and developers for the development stage (Table 2). More complex forms of the estimator include additional parameters: new development or modification of an existing one, %-reuse, and labor cost estimation not only for the design and implementation phases, but also for the analysis, test, and transition phases.

Fig. 1. Fit and Gap areas

Not one, but several legal entities or other organizational entities may be involved in the implementation project, as part of which the information system is adjusted and refined. Let’s call them organizational levels. Does the number of organizational levels affect the development and how to take this into account in the assessment? Let’s figure it out. If several organizational levels have the same requirements for development, this does not affect the evaluation of the latter. In another case, we can appeal to the complexity of the revision: either we increase it to implement the requirements common to all organizational levels, or we group similar requirements for a set of organizational units, and then we evaluate each group separately (see Table 3, requirements 3.1-3.2). If everything is quite transparent with the assessment of improvements, then you will have to tinker with the settings.

If you try to evaluate each unique setting through the difficulty parameter, the final value of labor costs will be sky-high and hardly realistic. Taking into account the dependence of both refinements and adjustments on the number of organizational levels, the following evaluation scheme is proposed. First of all, accounting is not carried out within the framework of single settings, but mainly in the context of groups of settings, for example: strategies for unblocking purchase orders, maintaining assessment classes, etc. for all organizational levels. For general groups of settings, labor cost estimation is carried out almost according to the single parameter of complexity. The evaluation of groups of settings depending on the organizational level can be carried out according to the formula:

Labor cost = Labor cost (complexity) * (1 + (N-1) * % – reuse),

where Labor costs (complexity) are costs depending on the complexity according to the Estimator, N is the number of organizational levels, %-reuse is similar to a similar parameter in the evaluation of developments and takes on a value of 50% by default (see Table 3, requirement 14). If the complexity for different organizational levels is very different, then it is suggested to do the same as in the case of developments: to divide groups of settings by organizational level in terms of complexity and evaluate them according to the formula above independently (see Table 3, requirements 3.1-3.2).

The estimate of labor costs according to the specified scheme is subject to both user requirements from the technical task (TOR) and functional needs that may be absent in the TOR document. Functional requirements are mandatory technical requirements without which the software solution simply will not work. For example, the TOR clearly states the need to reconcile purchase order documents, which is a user requirement, but does not clearly state the need to create, change, and delete such documents. Then the functionality of keeping orders is nothing but a functional requirement on which the confirmation scheme will be configured (see Table 2).

The entire list of both user and functional requirements is aggregated and subject to evaluation in the requirements tracking matrix, which is a single repository of all needs for a software product. An example of a similar matrix containing estimated labor costs for design and implementation is given in table. 3. The proposed labor cost estimation scheme can be used both for projects of implementation of custom developments and box solutions. No customizations are expected when evaluating custom programs. When evaluating the labor costs of implementing boxed solutions, it is worth paying attention to the vendor: for example, in SAP projects, a fairly large number of requirements are covered by settings, while 1C solutions contain a smaller volume of settings and more development.

For the full operation of the proposed scheme for calculating planned labor costs, the preliminary formation of the Estimator is required (see Table 1). In addition, the found values ​​​​of labor costs should be supplemented: yes, the labor costs estimated for implementation refer only to developers, so the amount of work similar in terms of labor costs must be planned for functional consultants and/or testers who will participate in unit or system testing, for which you can use by the method of building a resource plan based on the benchmarking of stages [3] …

Table 1. Estimator of design and implementation labor costs

Estimator of labor costs of design and implementation

Table 2. User and specified functional requirements

Custom and specified functional requirements

Table 3. Requirements tracking matrix with Fit/Gap analysis results and labor cost estimation

Requirements tracking matrix with Fit/Gap analysis results and labor cost estimation

Literary source

Katasonova N.S. RICEFS-classification of developments and settings for estimating labor costs // Corporate information systems. – 2023. – No. 4 (24) – P. 26-37. – URL: https://corpinfosys.ru/archive/2023/issue-24/230-2023-24-ricefclassification.

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