Analysis of Woody 2000 project. As part of our analysis, Kim Qualey; Executive vice president; John Carpenter; Director.

The company has a out !"# staffs and has approximately $%&,'"#,### in annual revenue. (ther mana)ement team mem ers include *iles +aster; ,ice -resident of -roduction; .pencer *oneys/or0; ,.- +inance *olly 1russel; ,.- -ersonnel; Kim Cushman, Controller and ,.- .ales and Estimatin) 1ruce .hare. (Business vision) 1ruce .harpe persuaded mana)ement that in other to increase sales, they needed to expand their facility. After several *ana)ement meetin)s, it /as decided that they expand in the present located and increase in existin) floor space of their current uildin). Project cost: Even thou)h *oody2s had only approved $34 for the entire pro5ect, /hen *oney/orth re6uest that the contractor provide a proposal, the ori)inal estimate /as $3'million. Althou)h after ne)otiations 7E8D9 the contractor a)reed to provide construction services. The contract /as ased on cost plus on fixed contracts. E8D /as responsi le for en)ineerin), procurement construction of the facility. E8D su contracted schemes and plotter 7. : -9. 8an lead etter, a mechanical and soft/are en)ineer /as appointed as the pro5ect mana)er even thou)h he had no pro5ect mana)ement experience. Kim Cushman developed a monthly cash flo/ chart settin) $3m for contin)encies and then assumin) that expenditure /ould account for the alance monthly. ;o/ever he loc0ed it up in his dra/er for future reference. The design Early in the desi)n sta)e, E8D su))ested that <oody2s ta0e over the procurement of the production train since they /ere more 0no/led)ea le, ho/ever miles faster used the opportunity to chan)e the desi)n /ith train specification /ithout consultation, /ith others. Due to 8an lead etter2s inexperience, he did not have any process in place to deal /ith or accommodate such chan)e hence, it /ent unnoticed. The chan)e cause the soft/are desi)n /or0 that =ead etter had completed to e redone there y causin) further delays, and )ivin) lead etter additional /or0. 1ecause lead etter had poor process or no processes on order for su mittal revie/s and approvals, these caused a delay in the delivery of the production train e6uipment. As construction pro)ressed, they encountered numerous pro lem such as the chan)e in the production train specification re6uirin) additional five feet to the len)th of the uildin) and this /as only discovered /hen holdin)>do/n olts for the ne/ train /ere laid out on site.

=ead etter did not plot do/n the ri)ht communication lin0, as he /as tal0in) directly to su contractor /ithout the contractor ein) present, leadin) to strained relationships on the site. =ead etter needed to put a communication plan in place to avoid such issues. +urthermore, issues arose /ith the paint shop as local inspection authority insisted that the surplus paint disposal arran)ement e up)raded to meet the latest environmental standards. T/o years into the pro5ect, they /ere nearin) the completion ut due to further 7shollfalls9 in the mana)ement process neither =ead etter nor *oneys/or0 had prepared any plans for the completion. They failed to hold the contractor accounta le for the completion of the pro5ect and to closeout. This created more delays leadin) to customers cancellin) orders and depleted inventories due to lost production. ?evenue declined due to lost sales and the pro5ect had )one over ud)et, /ith only !"@ completion. Cashman had to o tain additional line of credit at an excessive premium )iven the company2s ratin) additional expenses. Durin) the up)radin) process, construction activity fell in the re)ion causin) the sales of /oody to fall similarly. An extensive mar0etin) campai)n only resulted in minimal increase in sales. The expansion has caused under utiliAation causin) staff controversy /ith John Carpenter. Due to all the pro lems, *rs. Carpenter hived <. Easley Associates to conduct a post pro5ect appraisal. The project plan <hat <oody2s /ould have done initially /as to identify its real o 5ective and focused on definin) the parameters and scope of the expansion and the completion of the /or0 /ill e achieved /ith the .eventeen *illion dollar ud)et. A system should e put in place to include documentation, tas0, schedule accounta ility and inte)ration et/een /oody 7o/ner9 and the construction and desi)n team includin) )overnin) a)encies. The pro5ect teal should e formed so that they meet on a re)ular asis in order to clear issues and move in the ri)ht direction. +or the <oody '### pro5ect the ideal -ro5ect *ana)ement =ife circle *odel /ould e the Adaptive -ro5ect +rame/or0 7A-+9. This approach to <ysoc0i 7'##%9 /or0s all of the time and its main characteristics is that the scope is varia le, /ithin defined time constraints and optimiAes usiness value y ad5ustin) scope at each iteration. +ranchina citin) <ysoc0i 7'##%9. This model is idea ecause at each iteration the client can chan)e the scope of the pro5ect there y )ettin) )ood usiness value. This model parallels the Desi)n Development process in construction. The five process )roups are used /ith this *odel.

Planning: Esta lish plannin) sessions /ithin the or)aniAations so that all units and everyone is involve in the process. 1rea0do/n the )roups into su )roups such as finance, production and administration. At these sessions all issues concernin) the expansion /ill e addressed. All meetin) /ill e detailed and documented. A lo) /ill e maintained ?evie/ the current facility and evaluate the ne/ for expansion and the effect it /ill have on current production. .tudy the present situation and revie/ ho/ to incorporate any expansion, /ithout reductin) or affectin) current production identify issues that may arise and esta lish communications et/een all sta0eholders. .ince the model /e are usin) re6uires heavy client involvement, /e must enlist /oody2s executive team to ecome involved from the onset. +rom the development to the conclusion phase. 8n order to 0eep production )oin), a plan must e in place to ensure that production continues so as to satisfy existin) clients. A)ain a /ell esta lished communication process is in place. .electin) the contractor should e done usin) a recommended id process. +or the selection of the contractor. All of the pro5ect parameters are discussed and esta lished. All contractors must have contracts that stipulates /hat they accounta le for and defined scope, includin) completion date and close out audit. An overall pro5ect completion schedule, /ith all tas0 must e esta lished re)ular meetin)s must e held et/een all sta0eholders in order to 0eep the pro5ect on trac0 find attached a sample pro5ect *ilestones chart Exhi it A.

<oody2s '### /or0

rea0do/n structure (pportunity

7<1.9

Communication planB This is esta lished to trac0 and record all elements of the plannin), or)aniAation, meetin)s and all document controls. 8t is desi)ned so that /hen there is a pro lem, it is easily identified and a resolution is sort. is! "anage#ent: This has to e esta lished also. +irst /e identify the ris0 in the /oody '### pro5ect as identified y <ysoc0i 7'##%9.
3. Technical ris0 '. -ro5ect *ana)ement resources &. (r)aniAational ris0 C. External ris0

Assessing the is!: accordin) to <ysoc0i 7'##%9 ris0 is assessed y t/o factors the pro a ility that the ris0 /ill occur and the expected loss on the pro5ect. There are static and dynamic ris0 assessments.

"itigating the is!: This /ill involve ta0in) the identified ris0 and then determine ho/ to respond to the ris0 <ysoc0i 7'##%9 descri es five ris0 responses as accept, avoid, contin)ency plannin), miti)ate and transfer. The ris0 that /ere determined for this pro5ect include schedule and a)ency permit $ontrolling % "onitoring the is!: Accordin) to <ysoc0i 7'##%9 a ris0 lo) should e prepared to include 8D Dum er E ?is0 Description, ?is0 (/ner, action to e ta0en and outcome. This process is important in order to trac0 potential ris0 and revie/ their input and outcome. The financials /ill e /ell documented an open, /here all invoicin), payment re6uest and =-(2s are trac0ed. Actual cost and pro5ected cost /ill e revie/ed monthly to detect any lost overrun. At the end of the pro5ect, /e /ill conduct a post>implementation audit and prepare a +inal -ro5ect ?eport. +or the audit, /e /ill discuss the pro5ect and mar0 items for the audit. All historical data on the pro5ect is complied and revie/ed. The audit accordin) to +ranchina /illF
i.

Evaluate the pro5ect outcome and compare the pro5ect pro)ram, mission statement and the o/ner2s )oal and re6uirements. Develop a comparative analysis of the pro5ected to actual pro5ect schedule and identify 0ey indicators and causes for the chan)e in pro5ected to actual schedule. -repare a comparative ud)et analysis et/een the forecasted and the actual ud)ets, identifyin) /ea0nesses and trends in uyouts and vendor escalations. 8dentify /ea0nesses; shortfalls and /hat scope chan)ed areas caused the use of the contin)ency funds.

ii.

iii.

iv.

This is then complete and summariAed in the +inal ?eport and is a full documentation of he pro5ect.

Project Woody 2000 Wor! Brea!do&n 'tructure (WB')