Thesoftware development team of the B&Ws Company have come up with anew and exciting program by the name Forecasto. This is an internetbased forecasting system which is supposed to guide small and mediumsized companies as they make their way through the troubled waters ofbusiness. This is an ideal system for the business persons as theystart they companies and helps them to successfully make theirventures a success. According to the statistics on startups in thelast five years, most small business venture fiddle out and diewithin two years of starting. The development team at B&W havethus taken it upon themselves to come up with this systems which isaimed to make this situation a little better (Bates, 1995).
Forecastois based on cloud computing which is a system which makes use ofinterconnected computers and data sources around the world to use thedata around so as to make the particular venture a success. The cloudcomputing part enables the business owners who make use of Forecastoaccess to data stored not only in their computers but also around theworld. This access of large and diverse information is vital in theincubation of the business idea and goes a long way in ensuring thebusiness makes it past the projected life time and is able to turn aprofit in the end (Bateman & Wood, 2009).
Theintroduction of Forecasto is estimated to set back the prospectiveclients a sum of $200 which is manageable and in comparison to theamount of information available to the entrepreneurs. The gamble ofinvesting in this system is worth taking for any prudent investor asit will help u turn a profit in a record time and will give you ahigh chance of building an empire in record time (Bates, 1995).
Asit stands, the management of B&W Systems have given the projectmanagement team lead by Mr. Philips the mandate to research developand produce the idea of the Forecasto. This project is supposed totake close to 9 months from its conception to the distribution in themarket. According to the management of the company, this time period,exactly 35 weeks, is supposed to make it to the market before any ofthe competitors in this field produce such a System so that themarket share controlled by B&W Systems is not only secure butexponentially increased so that the company stays well above itscompetitors. The project management team is tasked to evaluate thefeasibility of the project being completed in that time period, makerecommendations to the board on appropriate course of action andeventually guide the development team to produce a high quality andfairly priced system which the customers as well as the company willbe proud to be associated with.
B&W’ssoftware development team as well as the top management of thecompany had the following reasons for coming up with thisrevolutionary system which is expected to be a must have for currentand future entrepreneurs (Zahra & Dess, 2001)
Forecastoaims to guide small and medium company owners through the process ofbusiness startup and incubation. Many people who open up small andmedium size businesses are mostly professionals in the area in whichthey venture. As a result, such individuals may not have adeptknowledge on how to make sure the business becomes a success. Theissue of cloud computing and the access the participants get via thecloud and the internet as a result of our system gives any person whomay not have any certification in running a business the requiredinformation to make sure his or her venture is a success(Garcia-Dastague & lambert, 2003). Forecasto provides usefulbusiness and also technical information which when used by thebusiness owner can be beneficial to the business and the businessowner (Carlin & Curran, 2011).
B&Wmanagement and development team has also the intention of makingtheir quarter in the software and computing industry secure. The endgame of any cooperation is to make a fortune and create a monopoly inits field of expertise. At the moment B&W systems is a largesoftware development company which has hundreds of software relatedsystems in the market and mostly sells its products through retailerslike Best Buy. With the introduction of Forecasto, B&W projectsthat its market share will rise significantly above the percentagesshared by its main competitors. The management team has its faith inthe team lead by Mr. Bob Phillips that the Forecasto system will bein the market in the next nine months. The achievement of this timedeadline is important as there is no similar product in the marketand if we are able to release our first then we will have a marketmonopoly and as a result we will recoup the cost of the project andmake a lot of money in the process (Mahoney & Chi, 2001).
Themanagement of B&W Systems also require something from the teamlead by Mr. Philips. The project, being still in the developmentphase, is supposed to be completed in record time, within a givenbudget and produce an exemplary system to its consumers.
Thetime given to the project management team is approximately ninemonths or 35 weeks to be exact. As it stands, the projections of therollout time show that the project will take a little longer thatthat by about five weeks. It is up to the project management team tobring this time down to within the given time framework. To finishwithin the specified time is essential to make sure the system isreleased before each of their competitors get wind of the project anddevelop a similar product. This ensures that the market share of B&WSystems will not be challenged unnecessarily (Reynolds, 2005).
Thebudget of the program was set aside by the management and hence theproject management team has the mandate to stick with that or do thework with a lower amount but not compromising the quality that thecustomers and the management expects from the team. The art ofcutting down on the project time has an effect on the cost as theemployees will have either to be increased or work overtime. Theovertime or increased employees translates to increased cost. Mr.Philips and his team has to strike a balance between the cost of theproject and the time they have been allotted to make sure they do notfall short of the Board’s expectations(Oviatt & McDougal,2005).
Withinthe time scheduled for the project and the amount of money allocatedto the System development, the development team is supposed to ensurethe final system is up to what the customers have come to expect fromthe developers from B&W Systems. The quality of the Forecasto issupposed to be good enough for the market and easy enough for thecustomers to use without complaining or unnecessary explanations.Maintaining a good quality product ensure the competitors will haveto work extremely hard to match our products, our customers will getvalue for their money and the development team will have a fewerproblems related to fixing the product in future after the beta tests(Haque & Hasin, 2012).
Theproject management team has to put all these points intoconsideration and strike a good balance between quality and cost ofproduct while still managing to release the product in record time.The perfect balance the team is expected to attain should enable theSystem to be of exemplary quality, within project cost and timeframework allocated.
Answersto key Questions
Thedevelopment of Forecasto is expected to be completed within a periodof thirty five weeks, make use of a sum of up to $210000. To achievethe said system in the given time period and within the budget theproject management team led by Mr. Philips had to consider thefollowing aspects of project management Critical path, Additionalcost and finally the behavior of the crash cost curve (Feylizadeh &Bagherpour, 2011).
Thecritical path in project management is longest necessary path througha network of activities and how the said activities interrelate witheach other. The critical path Method of program management is thealgorithm for the scheduling of the project activities to ensure theproject is successful. The Critical path is developed by first givinga list of all the activities required in the completion of a project,allocating each activity in the given list the time required for itscompletion in accordance to the project time line, determining thedependencies between the activities in the list and finally gettingthe logical endpoints of the activities which will give favorableresults (Chen & Tsai, 2011).
Inthe development of Forecasto, the following steps are to be followedfirst the requirements for the system are determined and gathered,the market research is conducted, the system is designed to meet themarket requirements and to use the requirements, the system isdesigned by the technical team, the system is tested, the flows ofthe system are corrected, documentation of the system is done, thesystems quality is assessed, the price is set depending on the amountof work that went into developing the product and the market researchdetails, production begins on a large scale and finally distributionof the System. All these activities have been allocated timenecessary for their completion as a function of the time forcompletion of the whole project.
Asit stands, the time allocated for the completion of the project is 35weeks but according to the times allocated for the various activitiesin the development of Forecasto, the project will most optimisticallytake 40 weeks. The most likely scenario is that the project will takean extra 16 weeks. The worst case scenario shows the project beingcompleted in 92 weeks. These numbers are way over the project timeframe and as a way to bring the project duration to within thestipulated period, crashing is necessary (Bates ,1995).
Crashduration is the shortest time possible for which an activity in theproject production path is to be completed. Crashing an activity maybe vital in our case as it ensures the project is completed in thestipulated 35 weeks instead of the 40 or 56 projected depending onthe time required for each activity. Project crashing can be achievedin one of the following methods shifting resources or addingresources to a particular activity on the production chain so thatthe said activity is finalized in a way shorter period than projectedor by merging two or more activities and as a result cutting down onthe time required to do both activities. By allocating more resourcesto an activity or merging different activities the cost of theactivity goes up. A balance must be attained to make sure the hike inprice doesn’t make the entire project cost very high above what itwas meant to cost (Achtenhagen, Maldi & Melin, 2011).
Thatsaid, the relationship between the cost of the project and timerequired to complete a given task should be a linear relationship asshown below. In the linear relationship, it can be seen that for theproject to be completed in the shortest time, a huge capital outlayis require compared to the amount of money that would have beenrequired had the project taken much longer. This is because theamount of resources that need to be channeled to that particularactivity so that it takes a shorter time is much more, either aspersonnel or as machinery. An increase in machinery or personneltranslate to higher fees for the salaries or running costs of themachines in question. This is the most common case but in practicemore complex convex or step functions are attained. Mr. Philips andhis team have the responsibility to ensure the optimum balance isattained to keep the project’s cost within the budget and finish itin record time (Kwak & Anbari, 2009).
Expansionis a way the critical path is attained in project management.Expansion is mostly achieved by a process called resource levelscheduling. This creates delays due to the resource being unavailablewhen it is needed due to the fact that it is being used in anotheraction due to crashing. Another negative impact of this is that pathsthat were previously short are now made longer or more resourcecritical hence more time might be wasted. To take care of the adverseeffects of resource level scheduling, a critical chain is developedso as to protect the activities and project duration from unseendelays (Herroelen & Leus, 2005).
Theproject schedule should therefore be monitored since the developmentof critical paths changes the path of activities. Mr. Philips has thetasks of utilizing PERT to monitor the project so that criticalactivities are not overlooked leading to necessary delays in theproduction line. PERT which stands for Program Evaluation and PreviewTechnique is a statistical tool used to analyze and represent thetasks involved in the completion of the project. The deviations fromthe critical path as a result of the resource level scheduling arekept in check and documented in the PERT beforehand so that theproject manager may be able to make an informed decision backed bystatistical data that the path he chooses to pick will cut down onthe cost and time of the project or both, where possible (Deckro etAl, 1995).
Theproject implementation should therefore be flexible to take care ofall the changes that have been brought about as a result of changesin the project’s path. The flexible implementation lead torecalculation of project time and as result blind estimates should beavoided because these will affect project implementation. To trackthe changes in the project implementation, an As Built Critical Path(ABCP) is used to analyze the specific causes and impacts of changesbetween the planned and the eventual schedule as actually implemented(Chan et Al, 2008).
Accordingto the times given for the completion of each task in the completionof the project, it is clear that the project will not be successfullycompleted in the stipulated 35 weeks and as a result an extension tobetween 40-50 weeks is required so that the project is completed withthe required quality which the management of B&W systems as wellas the customers have come to expect from the products B&Wreleases into the market. The 35 time given is good benchmark for theteam but ideally falls short of the requirement to produce bothquality and a consumer friendly system (Bartunek, Rynes &Ireland, 2006)
Withall the adjustments that have to be taken into consideration toreduce the time required for the production of the System, there is arise in the capital required to produce Forecasto within the timegiven.
Forthe crashing to be achieved, additional resources need to be directedto the activity whose period you wish to shorten. The channeling ofresources can be inform of personnel or investing in more efficientmachinery which will cut the time required for the completion of that activity. Employing more people will translate into more moneybeing used to pay the extra employees so that the activity isfinished faster. Another way of reducing the time taken is toincrease the working hours of the existing employees but as such theemployees have to be compensated for the more hours they put in whichwill also translate to higher production cost (Kanda & Rao,1984).
Thechange of machinery or technique with which a given task isundertaken also raises the cost of production. New machinery arealways more expensive and will require some more specializedpersonnel to run the new machinery. The increase in production costcan be compensated by reduced working hours but overall the cost ofthe project is raised.
Thisshows that reducing the project time to 35 weeks exponentiallyincreases the cost of the project which causes it to be outside thescope of the budget allocated to the project. This supports the ideathat the project time should be slightly extended (Deckro &Hebert, 2003).
Forthe development of the Forecasto, the Crash Cost Curve is linear asshown in the earlier figure. The crash cost curve describes theeffect of reducing the time of the project is supposed to take on thecost of the overall project. In order to reduce the time taken forthe project to be completed, the cost of the project rises because inorder to cut the project time, resources for the said activity has tobe increased and raises the cost (Kolisch & Padman, 2001)..
Anonlinear cost curve on the other hand is one where the increase intime of the project does not relate to the cost of the project in away that a relationship can be drawn. This due to the fact thatreducing the time needed for the completion of an activity may notnecessarily raise the cost and may even lower the cost in some cases.The resultant graph of such a scenario does not follow any linearexpectations and is hence hard to be interpreted.
Judgingfrom the data given to us in this project implementation, a decreasein the time an activity is to be completed in results in the increasein the cost of the said activity and hence it is true to say that therelationship is linear.
Asseen in the graph, it is important that the time for completion ofthe project as a way to lower the cost of the project so as theeventual cost of Forecasto is friendly to the consumers. The crashcost curve is a good indicator of the effects of crashing to theeventual cost of the project. In order to shield the customers fromthe effects crashing, it is paramount for the management to increasethe projects time (Liang, 2006).
Forthe quality of the Forecasto, the critical path for the developmentof this System should be adjusted so that the company release aquality and customer friendly product which will go a long way in theincreasing the market share taken up by the sales and profits B&WSystems. The sales are directly related to the price of a commoditybecause a fairly cost product will have very high sales which willreflect on the profits of the company.
Thetime allocated for the completion of the project at the moment isthirty five weeks. As it stands this time is very little for thequality and fair pricing of the resultant System and is therefore myrecommendation that the CEO and the management revise the time periodin order to increase this period by about ten weeks. The ten weekextension is vital to ensure that the quality of the System will beup to task, the cost of the project will be within the allocatedbudget and most importantly the eventual price of Forecasto will bereasonable at $200.
Therevision of the project time will go a long way in ensuring the costof the System is within the allotted capital. The budget will beachieved if the time is increased because the number of employeeswill not be so large so as to strain the budget, newer and moreefficient machinery will not be required which as a result will makethe cost of the project within the given budget. The crashing programis an expensive venture and its control to within reasonable levelsmake the entire project cost effective. This is what the managementof the company needs from the project management team and as thusshould be achieved (Bates ,1995).
Toensure that the project produces the System, Forecasto, which iswithin the quality customers have come to expect from the B&W’sSystem production line and the price of the System should be asprojected by the board, a balance of time and cost of the projectshould be attained. A good balance ensure that the production cost iswithin the time frame and the quality is ensured. Having a limitedtime and the same amount of time makes the production team tosacrifice the quality of the product which will make the customerscomplain. Giving priority to quality and time only makes the cost ofthe product to sky rocket which will have to be transferred to thecustomer. This again led to the customers to complain (Kwak &Anbari, 2009).
Inorder to attain the optimum balance, the management team have toincrease the time given for the project so that the eventual cost andquality is maintained and still keeping the capital cost of theentire project to within the stipulated budget. The efficiency of theproduction teams need to be increased so that they work on theproject within the stipulated time. The supervisors are to make surethe work is done effectively to ensure the same quality of work isattained by the same number of employees (Bartunek, Rynes &Ireland, 2006).
Withthese changes adhered to strictly, the production of Forecasto willgo on seamlessly and in the end B&W Systems will have a highquality ,fairly priced and premiere product in the market which willhelp the company increase its market share, profit and also betterits reputation among the customers.
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