Q$.3($a$)$ Statement of Work $($SOW$)$ is important for effective project scope management.

Describe the THREE $(3)$ key elements in a SOW.

$(6$ marks$)$

$($b$)$ Work breakdown Structure $($WBS$)$ can be used to define the scope of a project.

With the aid of a diagram, elaborate the key elements in the WBS$.$

$(5$ marks$)$

$($c$)$ A manufacturing company is considering to adopt the state$-$of$-$the$-$art industry

internet of things $($IIOT$)$ technology to automate the manufacturing process. The

total investment cost is RM$3$ million with an anticipated annual saving of RM$1$

million. The IIOT system can be used for $6$ years, with a $5\%$ of residual value at

the end of life. To accommodate to the learning curve of the new IIOT system, it

is assumed that only $60\%$ of the potential annual saving can be achieved in the

first year while $100\%$ annual saving can be achieved starting from second year

onwards. The maximum payback period allowed by the company is $4$ years.

$($i$)$ Analyse the cash flow to determine payback period of the system.

$(5$ marks$)$

$($ii$)$ Based on the calculation in Q$\mathrm{.}3$c$($i$),$ determine whether the system will be

considered a good investment to the company.

$(2$ marks$)$

$($iii$)$ Assuming the cost of fund is $20\%,$ analyse the cash flow to determine

discounted payback period.

$(5$ marks$)$

$($iv$)$ Based on the result in Q$\mathrm{.}3$c$($ii$),$ determine whether the company shall

consider to proceed with the investment.