Reference no: EM13218519

Brian Sanders had recently been appointed to the CEO position of the Acme Fireworks Company. Brian came from outside the fireworks industry but was highly recommended as a mover and shaker - the type of individual that could turn around the Acme Fireworks' business and drive profits from new revenue sources.

One of Brian's initiatives to drive change into Acme Fireworks was the development of an internet-based web-service that could be used by retailers to order Acme products. The new service would broaden sales channels to new markets and reduce the effort required to process orders.

At the time of the decision, the company had little or no experience developing web-based technology. They did have a company website but its primary function was an "electronic brochure" that described Acme's products to individuals that came across the website when browsing the Internet. Acme's website was updated only when new items were added to their product line, which was not very often.

The directors of Acme Fireworks decided to develop the website "in-house" because the five responses received from an open RFP (request for proposals) process outlined costs that were much higher than Acme's estimates to develop the website themselves. The directors noted that Acme's internal rates were less than a third of the quoted consulting rates. As a result of the decision, John Soares, a senior web designer with experience building e-commerce sites, was hired to lead the project.

After several weeks of planning activities, John determined that a project manager was required to assist him with running the project and managing administrative tasks associated with the project team. Kathy James was hired as the project manager shortly afterwards. Together Kathy and John were able to hire eight web developers and a business analyst to the team, most having less than 4 years work experience. Limited office space at the company's facility required the team to be located in a separate office about 5 km away.

The project got off to a shaky start because of various factors involved with setting up the new facilities and the technical development environment. This effort (cost and schedule) had been underestimated in the project plan. Kathy was also concerned about the higher-than expected costs to acquire the network and developer workstations - costs that were not in the plan.

The development tools selected for the team were "state-of-the-art" - released under much fanfare four months previously. The tools were found to be comprehensive but the learning curve was significant and licensing costs were a considerable cost to the project. John was not concerned about the costs because he felt increased developer productivity would offset the costs related to the software licenses and staff training.

Business requirements for the project were collected and documented by Peter Huff, the business analyst on the project. During his requirements gathering, Peter had interviewed two primary customer groups: product managers within Acme Fireworks, and representatives from Acme's retailer channel. The results of the interviews indicated that there were two distinct sets of expectations for the website. Peter documented these separately and passed them to the development team as his primary deliverable on the project. Peter wasn't sure of his role now that the requirements were complete; the project plan did not outline any tasks beyond the development phase of the project.

Development of the project's technical components was soon underway. As Brian the CEO was keenly interested in the project, he was regularly in touch with John inquiring about the project's progress. John's conversations with Brian were predominantly technical outlining the challenges to juggle conflicting business requirements and getting the development environment up and running. Although the project was progressing, it was slow. John started to miss his meetings with Brian because Brian's questions were getting harder to answer - it seemed that the team always had a technical problem that required solving when the meeting was scheduled. John would sometimes send Kathy in his place without briefing her on previous conversations with Brian.

Excluding the occasional meetings with Brian, Kathy had challenges of her own. The project plan had started to balloon - contingencies had been consumed within the first half of the project. The development team was adding new features to the website's functionality almost daily. At the same time, on-plan activities required more effort than originally estimated. Kathy was concerned that the team was working on off-plan activities and tracking the time to on-plan activities. The team was motivated to the point where they were volunteering personal time to work on the project.

Capturing administrative details was a challenge for Kathy because the team, including John, felt their time was better spent developing the site; tracking their activities was considered a waste of time. As a result, Kathy's project tracking records were below her standard of completeness.

At one of John's meetings with Brian, John suggested that they arrange a demonstration of the website to the Acme Fireworks directors, senior managers, and a few trusted retailers. Brian thought it was a great idea and added that the demonstration should be coordinated as part of the company's annual meeting to be held in four weeks. John agreed to the suggestion as he understood that the team only had a few minor features to complete before testing.

The next day John announced the upcoming demonstration to the team. Silence fell on the room. The team did not feel that they were ready for the demonstration and a quick review of Kathy's project plan confirmed that overtime was required if they were going to be ready. After discussing the problem amongst themselves, the team agreed that they could be ready but it would require a lot of work from everyone over the four weeks. It would be close.

On the day of the annual meeting John presented the project to an audience of about 40 people, mostly executive managers and company shareholders. John had spent most of the night with the team fixing last-minute bugs. As a result he was tired and unprepared for the presentation.

Despite the huge personal effort the team had contributed to complete the website, the demonstration didn't go very well - the audience wasn't really impressed with the multi-lingual capabilities the team had built, and a barrage of business-related questions were raised. Initially questions were about required functionality that the team had deferred to a subsequent release. It got worse when the questions shifted to the project's costs and long-term operational plans for the website. Both John and Kathy were under intense pressure to provide answers that they did not have.  Several of the shareholders left the meeting with concerns about the company's new business strategy.

The next day Brian requested a meeting with John and Kathy to discuss what happened at the demonstration and why he had not been apprised of the project's status. After the meeting Brian requested his CFO (Chief Financial Officer) to conduct a project review and recommend corrective actions.

Brian could not get the thought out of his mind - he had made a terrible mistake, the risks related to Acme Fireworks developing the website internally were not fully understood. Should he continue with the troubled project, or abandon it and jeopardize role as CEO?

Assignment Deliverables:

a) Applying your knowledge of project management, identify lessons that can be learned from the above troubled project. Your response should identify the challenge areas and provide actions that the project's management team should have undertaken to prevent the situation. As part of the review, identify the project's strengths .

b) The CFO has hired you to review the project. Your deliverable is a short (1-2 page) report that recommends to Brian (the CEO) what he should do with the project. The report should describe options, compare them, and recommend the preferred option for Brian to take action. The options should provide sufficient detail so that Brian can decide what to do. Information from Part A should be used as background (input) into the go-forward options outlined in your report.