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Cory Beck Project Management (BQM 444) March 28, 2014
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Abstract This paper will discuss a case study from the text book “Project Management: A Managerial Approach .” The case is titled “The Sharon Construction Corporation.” The case consists of a construction company that has won a contract for an upcoming project. The project is erecting a 20,000-seat stadium. The case is very in-depth in regards to the different stages of the project, and the amount of time that each stage will take to complete. Within the case, there are five different proposals that are given by the management team. Each of these proposals contains ways to reduce time, and work around specific identified risks that are associated with completing the project. In this paper, I will discuss the overall project timeline, the five proposals, and identify the best solution to complete the project on time, and with the most profit possible for the company.
Project Overview The upcoming project for The Sharon Construction Corporation is a project that has the potential to generate a substantial profit of $300,000. In order to maximize this potential profit, there are several risks that are associated that need to be analyzed and thought out to arrive at the most economically efficient conclusion. The first risk is the complication of the dates associated with the start and completion date. Construction on the project must start by February 15. Once the project is started, the company has one year to complete. A penalty clause of
Beck 3 $15,000 per week of delay beyond February 15 of next year is written into the contract. Another risk that is associated with the project is the company’s need for
unionized employees due to the substantial size of the project. The unionized employees have a labor contract that will expire on November 30, approximately ten weeks prior to the project ’s proposed completion deadline. In the past, The Sharon Construction Corporation’s unionized employees have gon e on strike 50% of
the time. If there is a strike, there is a 70% chance that the strike will last for 8 weeks, and there is a 30% chance that the strike could last for up to 12 weeks. If a strike lasts for 12 weeks, the project would not be completed until after the deadline. If the project extends past the February 15 deadline, the company will be charged $15,000 per week. Lastly, a colder December than what had been assumed was now being predicted. The cold temperatures had not been taken into consideration during earlier estimates since previous forecasts called for milder weather. Concrete pouring in December might require special heating that costs $500 per week. There are many risks that are associated with this project. Project difficulty is something that every project managers has to deal with. The idea of having a project run smoothly is something that is unheard of. Being able to handle the different types of problems that arise efficiently and effectively are what make an ordinary project manager become a very successful project manager. According to Villanova University, “Balancing all the elements of a complex project - time, money, scope and
people - is the project manager's job. ” The management team at the Sharon
Beck 4 Construction Company was charged with the task of proposing ideas that could eliminate some of the risks associated with the project.
The Proposals The management team of the Sharon Construction Corporation presented the following proposals. Their proposals were made on the ground of expected costs, and the amount of time that it could advance the specific activity. Proposal number one consists of expediting the pouring of the seat galley supports. This would cost $20,000 and cut the duration of the activity to 6 weeks. The initial activity was slated to last 12 weeks. By using this proposal it would cut the time in half. However, $20,000 is 15% of the potential net profit. 15% is a large chunk of potential profit to mitigate risks. Due to the high cost, and low return, I would not support proposal number one. Proposal number two is the same as proposal number one, but in addition, put a double shift on the filling of the field. This would cost an additional $10,000, a total of $30,000, and result in a 5-week time reduction from the original 14 weeks, resulting in a total of 9 weeks to fill the field. While a 5-week reduction is substantial, I would not support this proposal because the following step to complete is the artificial playing field turf. Installing the turf takes 12 weeks to complete. Without the 5-week reduction, the turf will be completed long before the remainder of the project is expected to be complete.
Beck 5 Proposal number three involves the roof. The roof is very important because it precedes several activities. The use of three shifts and some overtime could cut six weeks off the roofing at an additional cost of only $9,000. There are many steps on this project, like many projects, that cannot be completed until the roof is installed. If the roof is installed quicker, it will push everything that comes afterward forward by six weeks. Another large advantage is that it mitigates the weather factor sooner in the process. With a roof over the employee’s heads, work can continue as normal no matter what the conditions outside. For a price of $9,000, I would strongly support the third proposal and increase the productivity on the roof. Proposal number four suggests doing nothing special until December 1. Then if December is indeed cold, defer the pouring until the cold wave breaks, schedule permitting, and heat whenever necessary. If a strike occurs, wait until it is over, because there is no other choice, and then expedite all remaining activities. In this case, the duration of any activity could be cut but to no less than one-third of its normal duration. The additional cost per activity for any week that is cut would be $3,000. This proposal involves too much delaying. Waiting until December to start any work would be a waste of time. There is 8 weeks alone of clearing the sight before any work at all. Following that, it is an additional 4 weeks of excavating before any concrete will be poured. Waiting until after December 1 to pour concrete would be cutting the project too close to complete the project on time. The fifth and final project suggests not taking any action at all. The management team suggests simply hoping and praying that no strike and no cold
Beck 6 December occur. This would cost the company $0, however it leaves far too many unidentified risks. These unidentified risks can lead to costly mistakes that result in the project being behind schedule and over budget. If the project is behind, it can result in project manager needing to crash a project. According to Meredith and Mantel, crashing a project involves committing all of company’s resources to one particular job in order to finish it on time. The largest problem with a crash is it can cause ongoing projects to fall behind schedule due to pulling resources from their assigned tasks. It is always best as a project manager to do everything that you can to control the outcome of a project. Doing nothing might work sometimes, but eventually it can cause a major set back in a project manager’s career.
The Timeline Understanding the timeline of how a project is going to unfold is very important for a project manager. Understanding why a particular step cannot be started until another step is completed is the difference between project managing, and project observing. Employees do not like to listen to a project manager who doesn’t have a clue about the ins and outs of the process. Being a confident and
organized leader will encourage employees to want to work, even when you’re not around. The time line can be compared to a roadmap. Without knowing where you are, or how your getting to your next destination, you are lost. A timeline is a way for everyone all the way from stockholders, to the Chairman of the Bo ard, to have
Beck 7 something tangible that identifies whether the project is moving forward as planned, or if it has fallen behind schedule. The timeline for the Sharon Corp is somewhat difficult. There is a lot that needs to happen, in a relatively short amount of time. The project begins with clearing the site; this process will take approximately eight weeks. After the site is clear, work can start simultaneously on the structure itself and on the field. The easiest way to break this down is to think of the structure as one timeline, and the field as a secondary timeline. The work in the field involves subsurface drainage, which lasts eight weeks. Following the drainage, the filling portion can begin. The filling portion is expected to take approximately fourteen weeks. After the filling portion is complete, the construction of the artificial playing turf can take place. This activity is anticipated to last twelve weeks. Simultaneously on the second timeline, after the sight is clear, there is approximately four weeks of excavation. Once the excavation is complete, the concrete footers can be poured. Next, a steel structure that carries the roof will be built on top of the footers; this process will take approximately four weeks. After the structure is in place, the roof can be built lasting approximately eight weeks. Next comes the pouring of the supports for seat galleries lasting approximately twelve weeks. Following the supports, the pre-cast galleries will be erected; this process is expected to take thirteen weeks. Next, the seats can be poured with an estimated completion time of four weeks. The dressing rooms are next with a fourweek completion date. Next, the seats and dressing rooms are ready to be painted. The painting process is expected to take three weeks. The lights and s coreboard are
Beck 8 expected to take five weeks. Lastly the other facilities in the structure are allotted four weeks for completion. Knowing how and why this timeline is laid out in the manner that it is will prevent mistakes. Mistakes ultimately cost money. This timeline offers a good foundation of what to expect, but just like any project, there are circumstances that always arise. Sometimes estimated activity times are completed behind schedule, and other times they are completed ahead of schedule. It is important for the project manager to be flexible and always looking ahead at the timeline to see what areas may need to move forward or backward on the timeline. According to Davies, “Resource management involves the control of the time, manpower, money,
facilities, equipment, material, and technological resources available for the project”(Davies). Understanding the available resources, and being able to apply
those to a timeline is very important.
The Decision If I were the President of the company, I would find it somewhat challenging to pick the best decision for this project. There are many variables that are unknown. Because of the substantial amount of unknown variables, I would base my decision on the facts that I have available, and make my judgment call with the best intentions of the company in mind. First of all, the project needs to know when it will begin. This date will start the entire timeline and lay out the road map to a successful completion date. For this date, I would select the final day to start, February 15. This date will give us one
Beck 9 year to complete the project. I have selected this day for several different reasons. Number one, the site clearing is something that can be done while the ground is still frozen. The site will be clear by April 15. Looking at previous years, frost has not been an issue in April, therefore we will be able to begin digging and pouring the footers as necessary. The next decision as the President of the company is the dilemma of the workers going on strike. Without changing the proposed timeline, if we start on February 15, we will complete the project on December 13. As mentioned earlier, the labor agreements are only negotiated through November 30. If nothing is done and the unionized workers go on strike, there is a 30% chance that the strike will last beyond February 15, causing a very large penalty on a weekly basis. As the President, I would need to decide which proposal I would like to accept to speed up the timeline and move the completion date forward. Proposal number one does offer a significant advance, as far as completion date, but I feel that $20,000 may cost more than what it is worth. The second Proposal is simply increasing the amount of money and filling the field quicker. Viewing the field as a separate timeline indicates that the field portion of the project will be completed by October 11. There is no reason to spend extra money on speeding up the field timeline. Proposal number four suggests waiting until December. I see nothing but red flags with this proposal. I see it sky rocketing the price of the project, and almost certainly going beyond the date of completion. If there is a strike, the company has no choice but to wait it out and potentially be delayed by twelve weeks. Proposal number five is the hands off approach that does not take any action at all. Given my
Beck 10 start date, there is a 50% chance that proposal number five would work fine. However I feel that 50% is too high of a risk that could result in costing the company $15,000 per week. I feel that the smartest, and most economical decision is to accept the third proposal. The third proposal increases to three shifts when completing the roof. This increase will cut six weeks off of the roof, and will cost $9,000. Because of the amount of projects that cannot be started until after the roof is completed, speeding this process up is the best place to move the timeline forward. Putting the third proposal into effect will give a completion date of November 1. Completing the project by November 1 allows an extra thirty days for incidentals and unidentified circumstances that could arise before the union potentially goes on a strike. Our total net profit would be reduced to $291,000, but the risks associated with doing nothing would be greatly minimized. As the President of the company, I would expect that the board members, as well as the management team, to agree with my overall findings and decision on my proposal recommendation.
Conclusion There are many pieces to the puzzle of being a project manager. Project management is not something that individuals are born with. Being a good project manager takes skills that are not easily obtained. “A project has to accomplish a network of activities using some methods and methodologies. A project has an internal structure composed of resources, deliverables, tools, workers, etc. Finally, a project evolves through time, via resource consumption,
Beck 11 product delivery, members' changes and gain of experience, without losing its own identity”(Ludovic-Alexandre Vidal, & Marle, F.). A good project manager must be
exceptionally organized, passionate about their position, and enjoy working with people. According to Archer “ The blend of skills required of the successful project manager includes: communicating (listening and persuading), organizing (planning, goal-setting, and analyzing), team building (empathy, motivation, developing cohesion), leading (example setting, energetic, vision, delegation, optimism), coping (flexibility, creativity, patience, persistence), technological (experience, project knowledge). In this list, inter-personal and team skills rank well ahead of technical skills for successful project management, although some understanding of the technical aspects is essential (Archer). The case of the Sharon Construction Company is a great example of some of the challenges that a project manager will have to face. No two projects are identical. Researching, planning, organizing, and executing are words that describe an average day for a project manger. Laying a solid timeline, that includes realistic goals and pricing will lead to success. The mission statement of a successful project manager should be, hope for the best, but plan for the worst, and treat every project like it is the most important project of your life.
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Works Cited
Archer, N. (1997, Dec 09). Good project managers are vital resource. The Spectator. Retrieved from http://ezproxy.sckans.edu/login?url=http://search.proquest.com/docview/ 269884708?accountid=13979 Davies, J. R. (1994). Defining the responsibilities of the project manager. Plant Engineering, 48(9), 82. Retrieved from http://ezproxy.sckans.edu/login?url=http://search.proquest.com/docview/ 221012073?accountid=13979 Meredith J.R., Mantel S.J. (2012) Project Management, A Managerial Approach 8th Ed. Hoboken, NJ: Wiley Publishers Ludovic-Alexandre Vidal, & Marle, F. (2008). Understanding project complexity: Implications on project management. Kybernetes, 37(8), 1094-1110. doi:http://dx.doi.org/10.1108/03684920810884928 Villanova University. (2013) Top Ten Project Management Challenges. Retrieved on 28 March 2014 From http://www.villanovau.com/top-10-challenges/
