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Unformatted text preview: Auto Supply Company Auto Supply Company undertook a material development project to see if a hard plastic
bumper could be developed for medium-sized cars. Management referred to this key
strategic project as Project Bump. By January 2003, the Project Bump team had developed
a material that endured all preliminary laboratory testing.
Now an additional step was required before full-scale laboratory testing: a 3-D stress
analysis on bumper impact collisions. The decision to perform the stress analysis was the
result of a concern on the part of technical management that the bumper might not perform
correctly under certain conditions. The cost of the analysis would require corporate funding
over and above the original estimates. Since the current costs were identical to what was
budgeted, the additional funding was a necessity.
Samuel Adams, (project engineer working on Project Bump), was tasked with the stress
analysis. Samuel met with the Jeff Thomas, (functional manager of engineering analysis) to
discuss the assignment of personnel to the task.
Jeff: "I'm going to assign Arthur Mills to this project. He's a new man with a Ph.D. in
structural analysis, and I'm sure he'll do this task well."
Samuel: "Jeff, this is a high priority project. We need seasoned veterans, not new people,
regardless of whether or not they have Ph.D.s. Why not use another project as a testing
ground for your new employee?"
Jeff: "You project people must accept part of the responsibility for on-the-job training. I might
agree with you if we were talking about blue collar workers on an assembly line. But this is a
college graduate, and he comes to us with a solid technical background."
Samuel: "He may have a good background, but he has no experience. He needs
supervision. This is a one-man task. If he messes up, you will be responsible."
Jeff: "I've already given him our cost estimate database. I'm sure he'll do great. I'll keep in
close communication with him during the project."
Samuel Adams then met with Arthur Mills to get an estimate for the job.
Arthur: "I estimate that 350 hours will be required."
Samuel: "Your estimate seems low. Most 3-D analyses require at least 450 hours. Why is
your number so low?"
Arthur: "3-D analysis? I thought that it would be a 2-D analysis. But no difference; the
procedures are the same. I can handle it."
Samuel: “I’ll give you 500 hours. But if you overrun it, we’ll both be sorry."
Samuel Adams followed the project closely. By the time the costs were 50 % completed,
performance was only 30 %, and a cost overrun seemed inevitable. Jeff still asserted that
he was tracking the job and that the difficulties were a result of the new material properties.
His functional group had never worked with materials like these before.
Five months later Mills announced that the work would be completed in a week - two
months later than planned. The two-month delay caused major problems in utilization of the
facility and equipment. This meant that Project Bump was paying for employees who were
"waiting" to begin full-scale testing. 1 Auto Supply Company
On Monday mornings, the project office would receive the weekly labor monitor report for
the previous week. The latest report indicated that in the previous week, publications and
graphics art had spent over 100 man-hours in preparation of the final report. Samuel Adams
was furious. He called a meeting with Arthur and Jeff.
Samuel: "Who told you to prepare a formal report? All we wanted was a go / no-go decision
on structural failure."
Arthur: "I don't turn in any work unless it's professional. This report will be a masterpiece of
Samuel: "Your 60 % cost overrun is also a masterpiece. It seems your estimating was off!"
Arthur: "Well, this was the first time I’ve performed a 3-D stress analysis. And what's the big
deal? I got the job done, didn't I?"
1. How would you describe the problems that occurred?
2. What were the root causes of these problems?
3. What could Samuel have done differently?
4. What should be done at this point? 2 ...
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This note was uploaded on 03/01/2010 for the course IE 5555 taught by Professor Aabb during the Spring '10 term at Minnesota.
- Spring '10