Case Study PROJECT MANAGEMENT SITUATION—ESTABLISHING A PROJECT CONTROL SYSTEM An
ID: 426691 • Letter: C
Question
Case Study PROJECT MANAGEMENT SITUATION—ESTABLISHING A PROJECT CONTROL SYSTEM
An organization has been managing projects for several years through a group of project managers, specifically hired for their successes with this type of work. They have consistently performed well in other organizations, demonstrating an exceptional understanding of the technology and the project management discipline. They are excellent communicators and keep all parties informed of the progress of projects. Recently, the company finance director stated that many of the projects were losing money. This was determined when the new accounting system was implemented and costs for projects were collected, collated, and analyzed. Nearly one-third of the projects were not performing well in the cost area. Only 18 percent of the projects were producing revenues that met the company's fee structure. A review of project documents and plans as well as discussions with some project participants revealed the following:
• There was no consistency in the project plans. Some were missing vital information and others were inconsistent with the company's policies for project operations.
• Each project manager followed a different life-cycle model and methodology for similar projects. There was no single methodology being used for projects.
• Project managers relied on their experience, methodologies, and styles from their prior organizations.
• Project managers considered all projects to be successful if they met the cost, schedule, and technical performance objectives.
Because cost data were not provided by the accounting department, it was assumed that projects were making money. • No project audit had been conducted in at least 3 years and there were no procedures for conducting an audit. No trained people were available to conduct audits. The project managers were hired because they were "experts" in managing projects. Senior management was in a quandary—experienced project managers were not providing the desired cost performance results and there may be other areas that were in need of fixing. Further, the company relied heavily on projects to generate most of its revenue. There was a need for some immediate action to move the company into a better cost performance position.
Case Questions:
1. From the information given in the project management situation, what is the most likely problem and how would one fix it?
2. Why do highly qualified project managers use different methodologies in the same company? Is this a problem?
3. What are some of the reasons for lack of meeting cost performance (profit) goals? What can be done to improve the situation?
4. Does the company's project control system work? What, if any, changes should be made?
5. What type of audit would you perform on the projects to determine critical success factors? What would be your initial focus?
Explanation / Answer
From this information it is sure that the company is lacking continuous planning and co-ordination. This work can be done by a leader (top executive ) who can guide and control all the employs who are involved in the project. This leader is required to continuous supervise, guide, co-ordinate, plan and implement each and every activities of the project. Since each and every managers are belongs to different perspectives, styles and methodologies, they are unable to align their plans in a logical manner. And another thing is that they are building their own strategies for the project which are not easy for implementation but also will create conflicts among them. So this is one major problem. All project managers are implementing different strategies and there is no person to lead them effectively. These results lacking the optimum use of resources. Secondly cost of each and every activities were not recorded. So the project is not matched with cost performance. For solve this problem employment of a chief audit is required. No, not at all. The control system is running very poorly. By built proper communication channel or by built a proper organizational structure the problems arise in company can minimize effectively. In this situation I will like to employ Internal Audits for Check Company’s internal financial activities judge on their efficiency and effectiveness. It is one company’s independent internal staff. After this I will first focus on the training of project managers, so that in the future they will perform better.