Group 4 - Topic F

Group 4 - Topic F - flrTTrOUCTTorT 6) Pork IndusTries...

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Unformatted text preview: flrTTrOUCTTorT 6) Pork IndusTries oword The SCOTT ProjeCT. SCOTT ProjeCT wos o Ten-monTh endeavor TO develop 0 new prOdUCT for SCOTT CorpordTion. O SCOTT would Offer follow—on work for OT IedsT five yedrs, if The iniTidl R&D efforT proved soTisfooTory. Park's Matrix Organization Structure ll'U fion Jun31, 1987 O Scott Corporation : informed Park In— . dustries that cash : flow problem. Jan 3: 1987 , O Follow-on work : Park Industries award : would not be . the 5C0“ ContraCt- . awarded until first Sep 15, 1987 0 Jerry Dunlap was se_ 0 week of March 0 Franks wanted to : lected as project man— : (1988) : bOOkthe manage' . ager. . . ment reserve as o ‘ o o excess profit due to : _Pr70jergteocfpgiefiscgrrupz : : influence his Christ- 0 — 8 Functional members 0 o mas bonus- : Project start : : Inform Jerry to close 0 ' o o the project before : : :Nov1,1988. :Mar1'1988 0000.00.00.ocooo00000000....-o000000..cocoooooooooooooooooooo o o . Ju|1,1987 0N0V1,1987 : Weekly team meeting: : Project finish. ' Rescheduling and re- ° Bathtub period planning the project start. 225;: fess'ggeemanage Estimate need ' $125,000 for main- Franks agree the prob— tain the key people lems with the bathtub until Mar 1, 1988. period and request to be kept informed. Cost Expenses $140,000 l Salaries ll'll' $220 llll'l 32% vwa 22v vmm E Em vwm E EN vwm E E _. nwa EENF mmm E I: nwa E :2 mmm E Em nwa E In mwm E In nwa :Em i0 SHQULD JERRY G0 T0 THE GENERAL MANAGER? 6) ResponsibiIiTy of General Manager > Oversees all aspecTs of The projecT's developmenT and compleTion > Leading or coordinaTing The sTraTegic planning TuncTions of The arganizaTion > Managing baTh The revenue and COST elemenTs of income sTaTemenT L SHUIL JERY G TO THE ENEIL MANGE a Three purposes: > Keep Team members > Funding — managemen’r reserve > Talk abaqu Frank's plan i0 SHQULD JERRY G0 TO) THE GENERAL MANGER? @ Follow-on work on Morch, 1988 > Need To keep Tedm members To mdithih The efficiency > Moihfoin The quolify o Need To confirm ThoT There would be follow-on work To SHQULD JERRY GO TQ THE GENERAL MANAGER? @ MonogemenT reserve of $125,000 > A designoTed omounT of budgeT To occounT for porTs of The projecT ThoT connoT be predicTed (Unknown unknowns) > ExTro omounT of funds To be seT oside To cover unforeseen risks or ohonges To The projecT > SeT in planning sToTe > Should noT be Token from The operoTing budgeT l9 SHUL JEY t t ENEL e Frank’s plan > Management reserve would not include in the project budget > Inappropriate to use the management reserve 6? JERRY SHOULD GO TO THE GENERAL MANAGER 20 SHQUILD THE KEY PEQPILE Y SUPPORTED 0N OVERHEAD? oNO o MonogemenT reserve should be seT in plonning o NoT Too|< from The operoTing budgeT o ATTecT The working oTTiTude of sToTT o ATTecT The quoliTy ond efficiency of projecT 3.. ET This were o oosTnpius prorom, would you consider proohih The ousTomer wiTh your probiem in hopes oT reiieT? WhaT is CosT Plus program? Working wiTh one or more oTher Trodes blurs The line beTween your For jobs which No clear ore jusT Too definiTion of work and Theirs, cosT-plus is oTTen o vioble olTernoTive. Tough To price The scope of ouT in odvonce The work 3. If this were a cost-plus program, would you consider approaching the customer with your problem in hopes of relief? What is Cost Plus program? TABLE 16-4. SEQUENCE OF RESOURCES SACRIFICED BASED ON TYPE OF CONTRACT Firm- Fixed-Price- Fixed- Incentix'e- (‘osl-Hus- ('osl-I‘Ius- ('usl-I’Ius- Price Fee- (‘051 ('05! lncenlh e- AMI rd- Fee Fixed-Fee ll-‘I’I‘I (Fl‘l Fl (‘ontmd Sharing Fee 1(‘I‘II‘ l ((‘I‘AF .l r('I‘I-'I~' l Time 2 l 2 2 l 2 2 Cost 1 3 3 3 3 l 1 Performance 3 7’ l l 2 3 3 l: firit to bc sacrificcd. 2 = second to bc sacrificed. '3 = third ll) he s crificcd. 3., lf fnis were o oosf=lolos progrom, wouiol you oonsider ooroooning fne ousfomer Wifn your probiem in hopes of relief? Scoff Corporation: o Projecfed cosh flow problems Scoff and Pork: o Pofenfiolly hurf fufure business relofions > As following confrocf would be for five yeors > Will be negofiofed on or yeor—fo—yeor bosis Therefore, if would not be recommended 4° iii you were line ousiiomer oii linis cool-plus progromp Who‘ll would your response be for oddiliionol funds for line looliln‘liulo periodi ossunning oosii overrun? Problems lead to Cost overrun: o Schedule deloys Thor require overlime or idle Time cosling o Poor comparison of oc’ruol ond plonned cos’rs o Poor es’rimo’ring Techniques ond/or slondords, resulling in unreolis’ric budge’rs o Ou’r-of-sequence sterling and completion of oc’rivilies crncl even’rs o No management policy on reporting and control proclices 4° it you were the customer ot this oost=plus progromp whot would your response be tor odditiondl tunds tor the bothtub period ossunning oost overrun? o Scott Corporation: > Projected cosh flow problem > Bothtub period o Project stopped - No follow on work to Pork industries o Would not be favorable to increasing project costs o Bothtub period expense should not be considered (315 the project expense. o Therefore, I would not be favorable to increasing project costs . 5° Waulld your previous answer Change if The program had The money ayillalafe as a resullf of an underrun? Jerry should go To The general manager as well: @ Confingency funds should be l<epT > Assume ThoT The projecT would conTinue on schedule and wiThin The planned budgeT. a InappropriaTe use of Monogemenf reserve a The key people should be supporTed on overhead under This siTuoTion. > Good projecT office personnel are always in demand. a Group dynamic & Team moTivoTion o, How do you [oreveni lilnis Siiudiion ironn recurring on oil yedrly follow= on conirdclls? o Problem iden’rificolion of cos’r overrun: o Schedule deloys Thor require overlime or idle Time cos’ring o Poor comporison of ocluol onol plonned cos’rs o Poor eslimoring Techniques ond/or slondords, resulling in unreolislic budgels o Oui—of—sequence slor’ring ond comple’rion of oc’rivi’ries oncl evenrs o No monogemen’r policy on repor’ring ond conlrol proclices o, How do you preyenT This siTuoTion Tronn recurring on oil yedrly iolioyy= on conTrdcTs? o Include o sTorT doTe for ony follow—on conTrocTs WITh The originol R&D conTrocT. > BenefiT: If The ScoTT Corporation required ThoT The follow-on conTrocT sTorT doTe be pushed book, They would be responsrble for keeping The key projecT personnel on sToff. o SeT up of: > ProjecT conTingency funds > Risk monogemenT ocTion - included in o projecT’s budgeT ond plonning To help minimize uncerToinTy ogoinsT The possibiliTy of risk siTuoTions occurring. 6° Haw dc ycu prevenT This siTuaTicn ircm recurring cn all yearly ialaW=cn canTracTs? Risk identification 6) Life—cycle cosT analysis (9 Plan/WBS decomposiTion (9 Schedule analysis (9 Baseline cosT esTimaTes Risk analysis (Cost Evaluation) (9 Builds on Technical and schedule evaluaTion resulTs c TranslaTes Technical and schedule risks inTo COST (9 Derives cosT esTimaTe by inTegraTing Technical risk, schedule risk, and cosT esTimaTing uncerTainTy impacTs To resources (9 DocumenTs cosT basis and riskissues for The risk evaluaTron ...
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This note was uploaded on 10/02/2011 for the course ME ISE441 taught by Professor W.k. during the Spring '11 term at NYU Poly.

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Group 4 - Topic F - flrTTrOUCTTorT 6) Pork IndusTries...

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