MEEM5001 Enterprise Engineering Strategy

Parking Guidance System

Parking
Group Member: Chan Chun Kit Cheung Chi Ming Kwong Yee Fai Lai Chung Wing Sum Kai Yiu Yiu Chi Kan (50115211) (50165054) (50177772) (50276497) (50369026) (50524565)

City

Course Instructor: Dr. John K L Ho

Company Background
A newly established engineering company in HK in providing effective parking guidance system for all types of parking facilities. Shareholders of the company are graduates of City University of Hong Kong. No experiences in business, but the system is creative & able to meet the customers needs.

Mission Statement
To be a pioneer for providing efficient, competitive technology and engineering services to multi-storey car parks through application of parking guidance system.

Goals
To recommend & promote the use of innovative parking guidance system in Hong Kong. To optimize the use of parking spaces & reduce the time in searching free parking space by introducing parking guidance system. To gain profit for the newly established company in HK on a 39% rate of return in the first three year of business.

Objectives
Guide the driver to find a parking space more efficient & convenient. Optimize the use of car parking spaces Provide a long term car parking space solution for users & operators. Prevent a long queue of cars from forming at the entrance point

Environment Analysis

Finding a space in a car park can be difficult and stressful Reduce the time of searching space in order to reduce parking time Look for a solution for reduce air and noise pollution from vehicle in urban area No similar parking management system in HK Suitable for multi-storey car park in crowed district
e.g. Central, Mongkok, etc

Environment Analysis
Many car park developers: Improve the facilities No idea to implement the system Look for a solution for reduce traffic problem outside highly-utilized car parks Seek for improving the usage efficiency Seek for efficiency and flexible management system Increase the rate of filling parking space Improve customer service and customer satisfaction

Market Survey
Conduct market survey by questionnaire Apply Kansei Engineering (KE) - investigate the drivers feeling towards car parks
to identify the systems design

Totally 41 questions 5 points Semantic Differential (SD) scale for rating Sample size: 150 drivers

Market Survey
The four main parts in questionnaire: Part 1: General opinions towards car parks Part 2: Opinions about different parking guidance systems.
The proposed components involved: Auto-allocation of parking space Parking guidance indicator
(Numerical indicator, Electronic display board)

Indicating light for parking space

Part 3: Overall opinions towards the system Part 4: Personal information

General opinions from surveys results:

Most of respondents have experience of parking vehicle in highly-utilized car parks They felt difficult and annoying when looking for parking spaces They dont satisfied with the current parking indicators Some of them considered the time taken in searching for parking spaces

General opinions from surveys results:

Parking guidance system can reduce the time looking for parking spaces Parking guidance system can reduce the time taken for vehicles entering the car parks There is a need to install a parking guidance system in highly-utilized car parks

Conceptual designs of parking guidance system Based on surveys results: - Most of respondents dont like the computer assigning the packing space to them - They like numerical indicators more than electronic display board at the main entrance and each storeys entrance - They thought that too much information will distract their concentration in driving - They are welcome to install indicating lights for parking spaces

Key benefits for Drivers, Citizens and Developers

For car park developers:
Enhances customer service/customer satisfaction Increased rate of filling parking spaces Improved the profit Prevented excess queues at car parks

Key benefits for Drivers, Citizens and Developers

For drivers and citizens:
Improved traffic flow Improved road safety More convenient to drivers Reduced parking time Reduced atmospheric and noise pollution

Company Profile - Strength

No competitors Cost effective for large scale multi-storey car park Easy to install Low maintenance cost

Company Profile - Weakness

No experience due to no such system in HK No experienced staff Uncertain in actual demand No well known brand name

Identified Opportunities
No competitors, profit margin is large Many cars in HK, but no enough parking space Multi-stories car park is arising in HK Resurrection of property market, large shopping mall will increase Government introduces pedestrian zone, this reduces public parking spaces in crowed district Future development in mainland China, system can be applied in large city and result in gaining more profit

Identified Threats
Few people will use the car park if parking fee is high Indirectly affected by poor economic environment Easy replaced by other high/new technology Property developers are not rare, their decisions will affect the company development

Organization Wheel
(3) (2) (1)

Customer

Framework of Organization
1.) Core Target Customer: carpark management companies, facilities
management companies of large shopping malls etc.

2.) Company Development Organization: All founders are partners Teamwork: Partners + In-house staff People: Services Team (on-site, remote and hotline
support)

Framework of Organization
3.) Business Development
System Design : simple but innovative, new system for car park management in HK, suitable for multi-storey car parks Customer Services : meet customers expectation through questionnaires Assembly & Test : local design Operations : in-house staff

Quality Management
ISO 9000 certified EMSDs approved system design All technicians are registered electrical workers All components & parts are RoHS & WEEE compliance Product

Develop & Evaluate Strategic Alternatives

Two Strategic Alternatives for Operation: 1.in-house engineering services 2.completely out-sourcing Problems on Strategic Alternatives: 1.control of quality 2.communication 3.competition 4.coordination 5.costs

Alternatives for Operation

Strategy of In-house Services

Pro
* have own facilities/equipment * quicker reaction to problems * better control * good communication * have own facilities/equipment * higher business security

Cons
* high set up cost * high training cost * cost on own facilities/equipment * no external technical support * complicated management

Alternatives for Operation

Strategy of Out Source Services

Pro
* low set up cost * low training cost * less own facilities/equipment * external technical support * trained personnel available * flexible

Cons
* loss of direct control * quicker reaction to problems * readily fixed costs * hidden costs * risk

Evaluation of Various Strategies

Management Strategies control of quality communication competition coordination costs

Alternatives of Operation
In-house Staff Out-sourcing

Technology Background
Parking Guidance System
A displaying system that provides the latest parking information and directs the drivers to free parking space along the shortest possible route

Technology Background
Vehicle Detection Technology
Ultrasonic Object Detector Technology

Inductive Loop Detector Technology

Inductive Loop Detector

A coil of wire is buried under the parking lot and connected to a roadside control box

Ultrasonic Detector

Ultrasonic Detector
- Install in the ceiling on each parking lot - Ultrasonic frequencies (25.8kHz or 24.7kHz) - To detect the presence of car in the corresponding parking lot - LED is integrated in detector
to indicated two possible states Free (Available) or Occupied

- Low construction/installation cost compared with inductor loop detector

Ultrasonic vs. Inductive Loop

Criteria for comparison include:
Data accuracy, Environmental effect, Reliability, System expendability, Cost and Ease of installation and maintenance. **
Ultrasonic Inductive loop Good (98% or above) Low Good Medium Difficult

Data accuracy Environmental Effect Reliability System expendability Ease of installation/maintenance Construction cost

Good (98% or above) Low Good Good Easy

Medium

High

Vehicle Detection Technology

Ultrasonic Detector is selected in our parking guidance system Reference: ** Naoyuki Ushio and Toshiyuki Shimizu, Loop vs ultrasonic
in Chicago: Ultrasonic vehicle detector field test isolating diffused reflection and enduring harsh environment, 1997

System Architecture of Parking Guidance System

System Architecture of Parking Guidance System

System Architecture of Parking Guidance System

Digital Display and Signage

Financial Analysis
Source of Funding Friends Easy to borrow Depends on degree of friendship Bank Loans

More flexible
High interest rate for small business

Government Funding Scheme

Tailor-made loan scheme Strict application requirement

Financial Analysis
Initial Investment Office Hardware Computer Software with license R & D cost Marketing Promotion HK $ 80,000 80,000 60,000 50,000 Annual Expenses Direct Cost Labor salary Other Direct Cost Indirect Cost 648,000 30,000 HK $

Working Capital
Quality Control & Testing

50,000
10,000

System Maintenance
Marketing Promotion Taxes and insurance Other Indirect Cost

10,000
10,000 60,000 30,000 788,000

Total

330,000

Total

Financial Analysis
Net income from each project HK $

1. Ultrasonic detector
2. Microprocessor-based controller 3. Equipment rack/housing for the controller 4. Central workstation sever computer

126,250
7,500 1,500 12,000

5. Parking guidance system software with 1 year license

6. Hubs/Routers 7. Building service provisions 8. Related shielded cables 9. Uninterruptible power supply 10. LED display board 11. Consultancy and installation & testing Total cost for 1 project

28,000
1,000 85,000 54,400 27,000 13,000 65,000 420,650

Financial Analysis
Income Calculation: Markup price for each project: 40% on the total project cost
Selling Price = HK$ 420,650 X 1.4 = HK$ 588,910 Total Income from *projects each year: Total Income = HK$ 588,910 X 5 = HK$ 2,944,550 * Assume 5 projects each year

Financial Analysis
Net Profit for each project: Consultancy Income: 80% of the project cost category 11 Consultancy Income = HK$ 65,000 X 80% = HK$ 52,000 Markup Profit = HK$ 168,260 Total Profit for each year = HK$ (52,000 + 168,260) X 5 = HK$ 1,101,300 Net Profit = Total Profit Total Expenses = HK$ 1,101,300 HK$ 788,000 = HK$ 313,300

Financial Analysis
Payback Period: Year
1 2 3 4

Cash Inflow HK$ 440,520

1,101,300 1,101,300 1,101,300

Cash Outflow HK$ 1,118,000

788,000 788,000 788,000

Net Cash Flow HK$ (677,480)

(364,180) (50,880) 262,420

Payback period: 3 + [50,880/(1,101300 - 788,000)] X 12 = 3 year and 2 months

Time Schedule
Tasks
Stage 1: Requirement Study (30 days) (1.1) Operation and Process Review (1.2) Technology Review (1.3) Requirement Checklist Finalization

Month Month Month Month Month Month 3 6 2 4 5 1

Stage 2: System design and development (100 days) (2.1) Design of System (2.2) Coding of System (2.3) Testing version/ Demo Version Roll Up Stage 3: System testing (60 days) (3.1) Design of Testing Plan (3.2) System Acceptance Testing and Pilot Run (3.3) System Fine-tuning (3.4) System Final Version Release Stage 4: Training and marketing (60 days) (4.1) Promotion Start (4.2) System Training for Supporting Staff

Conclusions
Strategy plans are fully achieve the mission statements & objectives The functions of the Parking Guidance System is based on the customers need No market competitor as a result of high profit margin tends to shorten the payback period

Question & Answer

Thank You !