I NEED A SYNOPSIS OF THE READING AND KEY LEARNING POINTS OF THE READING! (HAS TO
ID: 356006 • Letter: I
Question
I NEED A SYNOPSIS OF THE READING AND KEY LEARNING POINTS OF THE READING!
(HAS TO BE MASTERS LEVEL WORK)
For this reading:
The award of the Scott contract on January 3, 1987, left Park Industries elated.
The Scott Project, if managed correctly, offered tremendous opportunities for follow-
on work over the next several years. Park’s management considered the Scott
Project as strategic in nature.
The Scott Project was a ten-month endeavor to develop a new product for
Scott Corporation. Scott informed Park Industries that sole-source production
contracts would follow, for at least five years, assuming that the initial R&D effort
proved satisfactory. All follow-on contracts were to be negotiated on a yearto-
year basis.
Jerry Dunlap was selected as project manager. Although he was young and
eager, he understood the importance of the effort for future growth of the company.
Dunlap was given some of the best employees to fill out his project office
as part of Park’s matrix organization. The Scott Project maintained a project office
of seven full-time people, including Dunlap, throughout the duration of the
project. In addition, eight people from the functional department were selected
for representation as functional project team members, four full-time and four
half-time.
Although the workload fluctuated, the manpower level for the project office
and team members was constant for the duration of the project at 2,080 hours per
month. The company assumed that each hour worked incurred a cost of $60.00
per person, fully burdened.
At the end of June, with four months remaining on the project, Scott
Corporation informed Park Industries that, owing to a projected cash flow problem,
follow-on work would not be awarded until the first week in March (1988).
This posed a tremendous problem for Jerry Dunlap because he did not wish to
break up the project office. If he permitted his key people to be assigned to other
projects, there would be no guarantee that he could get them back at the beginning
of the follow-on work. Good project office personnel are always in demand.
Jerry estimated that he needed $40,000 per month during the “bathtub” period
to support and maintain his key people. Fortunately, the bathtub period fell over
Christmas and New Year’s, a time when the plant would be shut down for seventeen
days. Between the vacation days that his key employees would be taking, and
the small special projects that this people could be temporarily assigned to on other
programs, Jerry revised his estimate to $125,000 for the entire bathtub period.
At the weekly team meeting, Jerry told the program team members that they
would have to “tighten their belts” in order to establish a management reserve of
$125,000. The project team understood the necessity for this action and began
rescheduling and replanning until a management reserve of this size could be realized.
Because the contract was firm-fixed-price, all schedules for administrative
support (i.e., project office and project team members) were extended through
February 28 on the supposition that this additional time was needed for final cost
data accountability and program report documentation.
Jerry informed his boss, Frank Howard, the division head for project management,
as to the problems with the bathtub period. Frank was the intermediary
between Jerry and the general manager. Frank agreed with Jerry’s approach to the
problem and requested to be kept informed.
On September 15, Frank told Jerry that he wanted to “book” the management
reserve of $125,000 as excess profit since it would influence his (Frank’s)
Christmas bonus. Frank and Jerry argued for a while, with Frank constantly saying,
“Don’t worry! You’ll get your key people back. I’ll see to that. But I want
those uncommitted funds recorded as profit and the program closed out by
November 1.”
Jerry was furious with Frank’s lack of interest in maintaining the current organizational
membership.
Explanation / Answer
Park Industries got a contract to develop a new product in the period of ten months from Scott Corporation.The contract called as The Scott project which gives tremendaous opportunity to park corporation if the R&D efforts proved satisfactory, Park industries will get follow on contract for at least five years and the price will be determined year to year.
Mr. Jerry Dunlap was selected as a project manager who new the importance of this contract regarding future growth of his company. Company employed seven fulltime employees including dunalp for full tennure of project who had best proven record. In addition to this eight employees were given to represent functional team menbers, four full time and four half time.
As the workload fluctued, team members and manpower was constant for the duration of project at 2080 hours per month.The company fetched the cost $60 per person felt fully burdened.
At the end of six months work the time when there was four months remaining to complete the contract scott corporation informed to park industries that there is projected cash flow problem and follow on work could not be started until first week of march.(1988) This situation posed a problem for Jerry Dunlap because he did not want to break up his project office. He scared of if his key people assigned another work then it will not be any gurantee that they will not bring back to this projevt.This was his proper team with experianced peoples.
Jerry calculated he needs $ 40000 to maintain and support his prople through this bathtub period. Fortunately seventeen days went in vacation period of Christmas and new year. Jerry revised his estimate to $125,000 for the entire bathtub period.and told his team members that they have to make a management reserve of $ 125000. The team agreed to this and stared replanning of work that will hit the target of making reserve.
Because of the nature of contract the admin support extended till January 28.as that time is needed for final data accountability and programme report documentation.
Jerry informed his boss Frank who was head of project department regarding the problems of bathtub period. frank had positive approach towars problems as he agreed to it. And told to keep informed.
On sept 15 Frank told Jerry he want to book management reserve of $ 1250000 as excess profit as frank can influence his package of bonus through it. Jerry was not happy by this statments he argued with frank but frank was predetermined to done this, He only promising to keep jerrys team as of now and to close the programme by Nov 1.
Thanks.
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