Project Charter Project Tittle and Description

Project Charter
Project Tittle and Description:Design, Supply and Install/Upgrade the Payroll System of Transnet Foundation.

Project ManagerThabo Makhasa Project Number: 3424233-01
Customer : Transnet SOC LTD
Project Sponsor Transnet Foundation
Project Owner Transnet Freight Rail
Project start: 01 April 2018 Project end: 30 April 2019
Project Manager Assigned and Authority Level
Approvals
Project Charter approval is required from Project Sponsor(s) and other Stakeholders and will form the basis for creating the Project Scope Statement and Project Management Plan.

Name Title / Role Signature
Dave Budler (Transnet Foundation Group) Project Sponsor Johan Zuma (TFR – Project Manager) Project Owner Thabo Makhasa(Transnet Group Capital) Project Manager Thabo Makhasa from the Capital Group is given the authority to lead and utilize the company’s resources to execute the project successfully. He will conform to quality standards and procedures, time/schedule and cost to complete the project. He will continue with monitoring and control of all the planned activities in the process groups.

He is tasked with managing the project team, approvals within scope and changes in relation to the specified budget, managing the project to conclusion and leading the project status report and project progress meetings with all the stakeholders.
Business Case
Introduction
This Project Charter formally authorizes a project to execute feasibility study, construction (upgrade) execution and close out of the Upgrade of Payroll System of Transnet.

This document provides the Project Manager with the mandate to execute the work required to fulfil the contract obligations of delivering the approved solution.

Project Charter approval is required from Project Sponsor(s) and other Stakeholders and will form the basis for creating the Project Scope Statement and Project Management Plan.

Transnet SOC (State Owned Company/Parastatal) with more than 60 000 employees in different operational divisions is the custodian of the country’s freight railway, ports and pipelines. Transnet’s primary business is freight transport and logistics services. In line with Government’s National Development Plan (NDP) 3, Transnet is required to contribute to the Government’s Medium-term Strategic Framework outcomes.
Employees are working in various locations; Ports and harbours-TNPA, Rail network – Transnet Freight Rail, Engineering and Group Capital Projects located out of nowhere in SA, Pipelines-NMPP and Transnet Properties working simultaneously for multiple business units, and have more varied work schedules than ever before.

As rated the Top employer of the year in succession in the recent years, the efficiency in compensating our employees means that we need to constantly manage and improve our payroll system as we are a large company in SA, so human resource management is of utmost importance to the success of our Organisation.
Therefore after careful investigations and assessment we have done, we want to replace or upgrade the employee payroll systems to better reflect the changing nature of our workforce. As we are trying to move up with times especially with technology, the current traditional geographically focused payroll systems are not integrated, are outdated, inflexible and require significant manual clerical time and high costs to maintain. Consolidated corporate reporting and analysis for the different systems is also very costly and inefficient.

By balancing these outcomes with building a commercially viable business, Transnet aims to provide an efficient, competitive and responsive economic infrastructure network; create decent employment; build a skilled and capable workforce to support an inclusive growth path; contribute to protected and enhanced environmental assets and natural resources; and provide a better South Africa contributing to a better Africa and a better world. This activity details the steps involved when reconciling payroll and distributing payments to ensure that all employees are paid timeously and accurately at the end of each and every month.
Payroll is run for a given payroll area as specified in the payroll calendar. After successfully completing the payroll run, the payroll period is closed on a monthly base.
The Gross to Net results are audited for accuracy and all posting information is selected from the payroll results, summarized, formatted, and posted to Accounting (FI/CO) for reconciliation. Thereafter funds are transferred to employees salary accounts and relevant 3rd party vendors i.e. Medical Aid, Pension Fund, Housing, etc. The Payroll Manager will send a request to the Finance Department to proceed with the payments to 3rd parties. Finance will authorize and execute the payments to 3rd party vendors.

Financial reports are generated within this activity to facilitate reconciliation between Payroll and Finance. 3rd party payment Reports are sent to relevant vendors and these reports detail amounts to be paid over as per employer’s and employee’s deductions.

The following steps have been identified for the Reconcile Payroll and Distribute Payments business activity.
Perform Gross to Net Audits;
Perform Live Posting to Accounting (FI/CO);
Transfer Payroll Funds;
Generation of Financial reports; and
Generation of Other Reports and Interfaces.

Charter Content
2.1.1 Project ObjectiveTo build R 200 million rand, Payroll system aimed at providing better, efficient, accurate HR services and state of art HR administration facility designed to deliver high quality People Management to be completed in a period of one year starting from 01 April 2018 – 30 April 2019.

Benefits
To provide faster, better and more efficient payroll systems and services to greatly improve the level of accuracy, building trust and reliability within the Human Resource Department.

The HR Department of Transnet hold the key to the largest category of controllable non-product cost (people) and should therefore be a powerhouse of information.

One of the most important task in running a business is by completing and ensuring quality in payroll. The benefits will be immense and it shows the prospect organisation benefits in Payroll system and the proponent’s benefits as well.

A fair, on-time and consistent, swift and payroll distribution of income in the organisation, accurate recording of time and attendance on work schedule, hours worked, overtime, travel claims, sleep outs, units of pay deductions, leave of absence (sick, unpaid) on the system.
Manageability of employee’s work units so as to ensure the exact amount of wages and salaries and other related bonuses will be financially given during payday, correct and calculated benefits, correct taxable amounts as in taxes and dependencies of the employee; payroll system that can be used (in this case SAP) by Transnet.

Also the introduction of paperless way of payroll administration, booking of training, leave, accommodation requests, bursaries, individual development plan, seminar or attendance requests and other Human resource requirements are done online.

People Management should be at the heart of Transnet, empowering our global workforce through mobile self-service, making it easier for people to do their jobs.

Governance is a financial necessity and can make or break our organisation. Without accurate data we cannot transform, adapt or change the organisation.

Existing Solution not fit for purpose
Legacy systems that have reached their end of life since inception in many decades ago
Multiple systems and the introduction of many systems that don’t work together
Not mobile but only centralised like the traditional head office
Lack of integration on multiple expensive systems that were introduced
Not intuitive
Relationship Breakdown with Vendor
Service and support generally is lacking
No investment in the product for future
Poor product roadmap
Change in Business Direction
Changes in business model is insufficient and unsupported
Change in market environment
Internal organisational changes which include company merges and acquisitions
Economic reasons
Governance is the most financial necessity and can make or break up an organisation
Economic workforce Management
Manager or Employee relationship by introducing workshop to teach the workforce about Employee Self Service
Make it easy for people to do their jobs
Reduce administration overheads costs
Increasing and acceleration of productivity
Reduction in operational costs
Improve the bottom-line, low paid junior employees
HR functions with strong employee systems are regarded as twice as effective and efficient as those that do not invest in such systems.

Resources Preassigned
Project Manager
Chief Finance Officer
HR Information Specialist/Communications Department
Director of HR
IT Programmer
Systems Analyst
Employment Specialist
Web Programmer
Budget Accountant
Director of HR
Payroll Manager Various HR & Payroll Specialists
ER Specialist
Human Resource Manager
ICT Software Specialist
IT Developer
Time and Attendance Specialist
To build R 160 million rand, 15 wards children’s hospital, aimed at providing better health care and state of art facilities designed to deliver high quality health care to be completed in a period of one year starting from 01 January 2017- 31 December 2017.

Stakeholders

The following stakeholders are most likely to be affected by payroll upgrade
Transnet SOC (Carlton Centre Head office)
Transnet Operational Divisions (All Regions)
Transnet Employees
Shareholder
Contractors
Project Team
The least affected or indirectly affected
Customers Investors and commercial partners
Rating agencies and financial institutions
Suppliers and service providers
Regulators – Railway Safety Regulator
Government Media and the general public
Academia and research institutions
NGOs
International bodies
Communities Organised labour Stakeholder concerns
Department of Public Enterprises
Non-Governmental Organisations
Department of Public Enterprise
Stakeholder Requirements as Known
No. Type Requirement Priority
FUNCTIONAL REQUIREMENTS
1.1 Work Orders System needs to keep track of production build stages Must have
2.1 Inventory Must track stock by BIN and warehouse location Must Have
2.2 Inventory System capable of lot tracking for purchased materials Optional
2.3 Inventory Display image of inventory item in database Preferred
3.1 Manufacturing Display production routing by phase Must have
NON-FUNCTIONAL REQUIREMENTS
4.1 Performance Real time access to data Must have
5.1 Availability Remote Access Preferred
6.1 Security System administrator rights Must Have
Requirement Number High-Level Requirement/Request
R1 Pay employees based on the agreed-upon rate/salary on the agreed upon schedule.
R2
R3
R4
R5
R6
Product Description/Deliverables
Assumptions
Delay in data collection for investigation
Procurement is fully dependent on finalization of the ongoing back to back legal
Negotiations including payment plans
Energy cost in terms of electricity.

Expensive fee for contractors rendering Payroll services.

Strike (labour unrest) due to payment system issues regarding sub-contractors
Constraints

Time – the project must be completed before April 2019
Transnet SOC plan to complete 5 regions within 2 years.

Scope
Measurable Project Objectives
Project Approval Requirements
Thabo Makhasa from the Capital Group is given the authority to lead and utilize the company’s resources to execute the project successfully. He will conform to quality standards and procedures, time/schedule and cost to complete the project. He will continue with monitoring and control of all the planned activities in the process groups.

He is tasked with managing the project team, approvals within scope and changes in relation to the specified budget, managing the project to conclusion and leading the project status report and project progress meetings with all the stakeholders.
High- Level Project Risks
Risk Controls
Risk Name (Ref) Risk Description Rating
or
Impact Control Name (Ref) Control Description or Possible mitigating action Control Owner Classification
PAY_R3
Employee deductions are not valid and not processed accurately in accordance with relevant legislation resulting in potential fines and reputational risk. High
PAY_C28
SDL Reconciliation, UIF and tax on a monthly basis is performed by the Payroll Specialist to ensure the correct amounts are paid to legal entities such as SARS on an annual basis. The Payroll Manager will review and approve. Payroll Manager
Compensating Control

PAY_R3
Employee deductions are not valid and not processed accurately in accordance with relevant legislation resulting in potential fines and reputational risk. High
PAY_C22
A of movement file is sent to 3rd party companies to inform them of transfers between ODs, exits and joiners.

Payroll Manager
Key Control
PAY_R3
Employee deductions are not valid and not processed accurately in accordance with relevant legislation resulting in potential fines and reputational risk. High
PAY_C23
A single HCM system will ensure that all employee data is managed centrally which will reduce the complexity of managing employee deductions between ODs Payroll Manager
To be Determined
PAY_R4
Payroll data is viewed or maintained by an unauthorised employee resulting in the security and confidentiality of the pay data being compromised. High
PAY_C11
The interface medium to SAP FI/CO will be created using SAP ALE links which will not allow interface files to be accessed by any unauthorised people.

Payroll Manager
Key Control
PAY_R1
Payroll related employee data is not valid, captured inaccurately or captured incompletely resulting in employee’s being paid incorrectly or for work not done. High
PAY_C26
Variance reports are reconciled for variances in employee pay data and signed off by the Payroll Manager on a monthly basis.

Payroll Manager
Compensating Control
PAY_R1
Payroll related employee data is not valid, captured inaccurately or captured incompletely resulting in employee’s being paid incorrectly or for work not done. High
PAY_C6
When maintaining bank details support documentation is required and a change confirmation is sent to the employee.

Payroll Supervisor
Key Control
PAY_R1
Payroll related employee data is not valid, captured inaccurately or captured incompletely resulting in employee’s being paid incorrectly or for work not done. High
PAY_C27
When maintaining bank details a reconciliation report for master data changes in the HCM system is created specifically for reconciling bank detail changes.

Payroll Manager
Key Control
PAY_R1
Payroll related employee data is not valid, captured inaccurately or captured incompletely resulting in employee’s being paid incorrectly or for work not done.

High
PAY_C8
The Payroll Calendar is generated annually by the Payroll Manager and contains specific dates for Payroll milestones on a month to month and annual basis that all ODs will be required to follow ensuring that the Payroll department meets pay related deadlines in a timely manner. Remuneration Manager
Key Control
PAY_R2
Payroll costs and related items are not accurately accounted for and relevant and timely management information is not produced resulting in potential fines and reputational risk.
High
PAY_C14
The Payroll Specialist uses a Payroll checklist during the payroll processing to ensure that all steps are run correctly and in a logical order. This ensures the Payroll procedures are run correctly. It can be automated via a scheduling tool. The checklist is used in conjunction with the Payroll Calendar to ensure relevant management information requirements. These requirements are outlined in the checklist, run in a timely manner and provided to the relevant recipients. Payroll Manager
Key Control
PAY_R2
Payroll costs and related items are not accurately accounted for and relevant and timely management information is not produced resulting in potential fines and reputational risk.
High
PAY_C15
The Payroll Manager signs off a reconciliation report of the payroll results which also details who has made changes to the system during the payroll processing period and what changes were made. The report is run by the Payroll Specialist. This report will only be signed if the Payroll Manager is satisfied that the payroll for the month has been run successfully. This control ensures segregation of duties (SOD).

Payroll Manager
Key Control
PAY_R2
Payroll costs and related items are not accurately accounted for and relevant and timely management information is not produced resulting in potential fines and reputational risk.
High
PAY_C18
The payslip distribution office provides the Payroll Specialist with a confirmation that payslips have been delivered.

Payroll Manager
Non-Key Control
PAY_R2
Payroll costs and related items are not accurately accounted for and relevant and timely management information is not produced resulting in potential fines and reputational risk. High
PAY_C19
The payslip print shop provides the Payroll Specialist with a confirmation that payslips have been printed and collected for distribution.

Payroll Manager
Non-Key Control
PAY_R4
Payroll data is viewed or maintained by an unauthorised employee resulting in the security and confidentiality of the pay data being compromised. High
PAY_C20
The EFT file is sent directly to the Rabbit server using a secure connection by the Payroll Specialist.

Payroll Manager
Key Control
PAY_R2
Payroll costs and related items are not accurately accounted for and relevant and timely management information is not produced resulting in potential fines and reputational risk. High
PAY_C21
The Payroll Specialist posts Payroll results to Finance on a monthly basis after the payroll processing has completed successfully. This ensures that Payroll and Finance are aligned with respect to Payroll information. Payroll Manager
Key Control
PAY_R3
Employee deductions are not valid and not processed accurately in accordance with relevant legislation resulting in potential fines and reputational risk.
High
PAY_C29
The Payroll Specialist informs 3rd parties of the amounts they should be receiving for the month via a feedback file which will be aligned with the amount deducted from employees as part of the payroll processing.

Payroll Manager
Key Control
PAY_R1
Payroll related employee data is not valid, captured inaccurately or captured incompletely resulting in employee’s being paid incorrectly or for work not done.

High
PAY_C31
The Payroll Supervisor will sign the relevant test script used to test configuration change requests. This is done in the QA system before the changes are transported to Production. This ensures accountability within the Payroll department for system changes relating to tax tables, configuration changes etc. Those are performed as required by Payroll, in a timely manner and ensuring the changes are correct. No Payroll employee will be responsible for the configuration or any system/technical maintenance functions. This control ensures segregation of duties (SOD). Payroll Manager
Key Control
PAY_R4
Payroll data is viewed or maintained by an unauthorised employee resulting in the security and confidentiality of the pay data being compromised.

High
PAY_C32
The Payroll Manager will take responsibility as the Business Process Owner and signs-off system access related to Payroll. This ensures that employee access to pay related data is restricted to the level that the employee in question is allowed to view and/or maintain. This control ensures segregation of duties (SOD). This control facilitates compliance with the Password Policy. Payroll Manager
Key Control
Other risks will be identified during the schedule risk assessments
Project Sponsors Authorising This Project:
……………………………….. ………………………………………………………
Thapelo Mzimba, GCE Nkosinathi Ntombela, Director of Human Resources