Reference no: EM132138916

CASE STUDY Background Sarah’s project had now become more complex than she had anticipated. Sarah’s company had a philosophy that the project manager would be assigned during proposal preparation, assist in the preparation of the proposal, and take on the role of the project manager after contract award, assuming the company would be awarded the contract. Usually, contract go-ahead would take place within a week or two after contract award. That made project staffing relatively easy for most of the project managers. It also allowed the company to include in the proposal a detailed schedule based upon resources that would be assigned upon contract award and go-ahead. During proposal preparation, the functional managers would anticipate who would be available for assignment to this project over the next few weeks. The functional managers could then estimate with reasonable accuracy the duration and effort required based upon the grade level of the resources to be assigned. Since the go-ahead date was usually within two weeks of contract award and the contract award was usually within a week or so after proposal submittal, the schedule that appeared in the proposal was usually the same schedule for the actual project with very few changes. This entire process was based upon the actual availability of resources rather than the functional managers assuming unlimited resources and using various estimating techniques. While this approach worked well on most projects, Sarah’s new project had a go-ahead date of three months after contract award. For the functional managers, this created a problem estimating the effort and duration. Estimating now had to be made based upon the assumption of unlimited availability rather than the availability of limited resources. Functional managers were unsure as to who would be available three or four months from now, yet some type of schedule had to appear in the proposal. Sarah knew the risks. When the proposal was being prepared for Sarah’s proposal, the functional managers assumed that the average worker in the department would be available and assigned to the project after go-ahead. The effort and duration estimates were then made based upon the average employee. If, after go-ahead, above-average employees would be assigned to her project, she could possibly see the schedule accelerated but had to make sure that cost overruns did not happen because the fully loaded salary of the workers may be higher that what was estimated in the proposal. If below-average workers are assigned , a schedule slippage might occur and Sarah would have to look at possible schedule compression techniques, hopefully without incurring added costs. Award of Contract Sarah’s company was awarded the contract. Sarah had silently hoped that the company would not get the contract, but it did. As expected, the go-ahead date was three months from now. This created a problem for Sarah because she was unsure as to when to begin the preparation of the detailed schedule. The functional managers told her that they could not commit to an effort and duration based upon actual limited resource availability until somewhere around two to three weeks prior to actual go-ahead date. The resources were already spread thin across several projects and many of the projects were having trouble. Sarah was afraid that the worse case scenario would come true and that the actual completion date would be longer than was in the proposal. Sarah was certainly not happy about explaining this to the client should it be necessary to do so. P a g e 3 | 4 Approaching Go-Ahead Date As the go-ahead date neared , Sarah negotiated with the functional managers for resources. Unfortunately, her worst fears came true when, for the most part, she was provided with only average or above-average resources. The best resources were in demand elsewhere and it was obvious that they would not be available for her project. Using the efforts and durations provided by the functional managers, Sarah prepared the new schedule. Much to her chagrin, she would be at least two weeks late on the four-month project. The client would have to be told about this. But before telling the client, Sarah decided to look at ways to compress the schedule. Working overtime was a possibility, but Sarah knew that overtime could lead to burned-out workers and the possibility of mistakes being made would increase. Also, Sarah knew that the workers really did not want to work overtime. Crashing the project by adding more resources was impossible because there were no other resources available. Outsourcing some of the work was not possible as well because of the statement of work identified proprietary information provided by the client and that the contract would not allow any outsourcing of the work to third party. Because of the nature of the work, doing some of the work in parallel rather series was not possible. There was always a chance that the assigned resources could get the job done ahead of schedule but Sarah believed that a schedule delay was inevitable Time for a decision Sarah had to make a decision about when and how to inform the client of the impending schedule delay. If she told the truth to the client right now, the client might understand but might also believe that her company lied in the proposal. That would be an embarrassment for her company. If she delayed informing the client, there might a chance that the original schedule in the proposal would be adhered to, however slim. If the client is informed at the last minute about the delay, it could be costly for the client and equally embarrassing for her company

Questions

1. Is this common situation for most companies or an exception to the rule?

2. Is it possible to convince a client that the schedule is just a rough guess during competitive bidding and finalization of the schedule can be made only after go-ahead?

3. What were improvement that could be suggested in Sarah’s company to avoid schedule delay?