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Project Management Case Study Gocoul Communications Inc

BACKGROUND

Gocoul Communications, Inc. (GCI) is a 30-year-old, $350 million division of Communication

Systems International, Jamaicas largest communications company. GCI employs over 340 people, of

whom more than 200 are engineers.

Ever since the company was founded 30 years ago, engineers have held every major position within

the company, including president and vice president positions. The vice president for accounting and

finance, for example, has an electrical engineering degree from The University of the West Indies and

a masters degree in business administration from Harvard.

Until 2018, GCI was a traditional organization where everything flowed up and down. In 2019, GCI

hired a major consulting firm to come in and train all personnel in project management. Because of the

reluctance of the line managers to accept formalized project management, GCI adopted an informal,

fragmented project management structure where the project managers had lots of responsibility but

very little authority. The line managers were still running the show.

By 2020, GCI had grown to a point where the majority of its business base revolved around 12 large

customers and 30 to 40 small customers. The time had come to create a separate line organization for

project managers, where each individual could be shown a career path in the company and the

company could benefit by creating a body of planners and managers dedicated to project completion.

The project management group was headed up by a vice president, Sasha Gaye Williams and included

the following full-time personnel:

Four individuals to handle the 12 largest customers

Five individuals for the 30 to 40 small customers

Three individuals for research and development (R&D) projects

One individual for capital equipment projects

The nine customer project managers were expected to handle two to three projects at one time if

necessary. However, because customer requests usually did not come in at the same time, it was

anticipated that each project manager usually would handle only one project at a time. The R&D and

capital equipment project managers were expected to handle several projects at once.

In addition to the above personnel, the company also maintained a staff of four product managers who

controlled the profitable off-the-shelf product lines. The product managers reported to the vice

president of marketing and sales.

In October 2021, Sasha Gaye decided to take a more active role in the problems that project managers

were having and held counseling sessions with each project manager. The following major problem

areas were discovered.

R&D PROJECT MANAGEMENT

Project manager: My biggest problem is working with these diverse groups that arent sure what

they want. My job is to develop new products that can be introduced into the marketplace. I have

to work with engineering, marketing, product management, manufacturing, quality assurance,

finance, and accounting.

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Everyone wants a detailed schedule and product cost breakdown. How can I do that when we

arent even sure what the end item will look like or what materials are needed? Last month I

prepared a detailed schedule for the development of a new product, assuming that everything

would go according to the plan. I worked with the R&D engineering group to establish what we

considered to be a realistic milestone. Marketing pushed the milestone to the left because they

wanted the product to be introduced into the marketplace earlier. Manufacturing then pushed the

milestone to the right, claiming that they would need more time to verify the engineering

specifications. Finance and accounting then pushed the milestone to the left, asserting that

management wanted a quicker return on investment. Now how can I make all of the groups

happy?

Sasha Gaye: Whom do you have the biggest problems with?

Project manager: Thats easy - marketing! Every week marketing gets a copy of the project

status report and decides whether to cancel the project. Several times marketing has cancelled

projects without even discussing it with me, and Im supposed to be the project leader.

Sasha Gaye: Marketing is in the best position to cancel projects because they have inside

information on profitability, risk, return on investment and competitive environment.

Project manager: The situation that were in now makes it impossible for the project manager to

be dedicated to a project where he does not have all of the information at hand. Perhaps we

should either have the R&D project managers report to someone in marketing or have the

marketing group provide additional information to the project managers.

SMALL-CUSTOMER PROJECT MANAGEMENT

Project manager: I find it virtually impossible to be dedicated to and effectively manage three

projects that have priorities that are not reasonably close. My low-priority customer always

suffers. And even if I try to give all of my customers equal status, I do not know how to

organize my work and have effective time management on several projects.

Project manager: Why is it that the big projects carry all of the weight and the smaller ones

suffer?

Project manager: Several of my projects are so small that they stay in one functional

department. When that happens, the line manager feels that he is the true project manager

operating in a vertical environment. On one of my projects, I found that a line manager had

promised the customer that additional tests would be run. This additional testing was not priced

out as part of the original statement of work. On another project, the line manager made certain

remarks about the technical requirements of the project. The customer assumed that the line

managers remarks reflected company policy. Our line managers dont realize that only the

project manager can make commitments on resources to the customer as well as on company

policy. I know this can happen on large projects as well, but it is more pronounced on small

projects.

LARGE-CUSTOMER PROJECT MANAGEMENT

Project manager: Those of us who manage the large projects are also marketing personnel and, occasionally,

we are the ones who bring in the work. Yet everyone appears to be our superior.

Marketing always looks down on us, and when we bring in a large contract, marketing just

looks down on us as if were riding their coattails or as if we were just lucky. The engineering

group outranks us because all managers and executives are promoted from there. Those guys

never live up to commitments. Last month I sent an inflammatory memo to a line manager

because of his poor response to my requests. Now I get no support at all from him. This doesnt

happen all of the time, but when it does, its frustrating.

Project manager: On large projects, how do we, the project managers, know when the project

is in trouble? How do we decide when the project will fail? Some of our large projects are total

disasters and should fail, but management comes to the rescue and pulls the best resources off

of the good projects to cure the ailing projects. We then end up with six marginal projects and

one partial catastrophe as opposed to six excellent projects and one failure. Why dont we just

let the bad projects fail?

Vice president: We have to keep up our image for our customers. In most other companies,

performance is sacrificed in order to meet time and cost. Here at GCI, with our professional

integrity at stake, our engineers are willing to sacrifice time and cost in order to meet

specifications. Several of our customers come to us because of this. Last year we had a project

where, at the scheduled project termination date, engineering was able to satisfy only 75

percent of the customers performance specifications. The project manager showed the results

to the customer, and the customer decided to change his specification requirements to agree

with the product that we designed. Our engineering people thought that this was a slap in the

face and refused to sign off the engineering drawings. The problem went all the way up to the

president for resolution. The final result was that the customer would give us an additional few

months if we would spend our own money to try to meet the original specification. It cost us a

bundle, but we did it because our integrity and professional reputation were at stake.

CAPITAL EQUIPMENT PROJECT MANAGEMENT

Project manager: My biggest complaint is with this new priority scheduling computer package

were supposedly considering to install. The way I understand it, the computer program will

establish priorities for all of the projects in-house, based on the feasibility study, cost-benefit

analysis, and return on investment. Somehow I feel as though my projects will always be the

lowest priority, and Ill never be able to get sufficient functional resources.

Project manager: Every time I lay out a reasonable schedule for one of our capital equipment

projects, a problem occurs in the manufacturing area and the functional employees are always

pulled off of my project to assist manufacturing. And now I have to explain to everyone why

Im behind schedule. Why am I always the one to suffer?

Sasha Gaye carefully weighed the remarks of her project managers.

Then came the difficult part. What, if anything, could Sasha Gaye do to amend the situation given the

current organizational environment? Help her by answering the following questions as she prepares for

an extra-ordinary board meeting called by GCIs Board Chairman Mark Whyte.

QUESTION 1

a) Can 13 project managers be controlled and supervised effectively by one vice president and

should a company be willing to let some large projects fail? Use sound project management

principles and concepts to support your response.

b) While assisting with managing one of the large customer projects, Kelli-Ann recommended that

a Risk Register and a Stakeholder Analysis be created. Sasha Gaye thinks it is a waste of time

and resources to create these documents. How would Kelli-Ann convince her otherwise? In

your response also indicate the type of project management structure that GCI is using and

state whether or not it is possible that capital equipment projects almost always take a backseat

to other projects.

a) Aldene, a recent recruit to the Accounting and Finance Division suggested to her VP that

negative risks were to be given more attention when embarking on projects. Her argument is

that many of the slippages are attributable to the lack of a proper risk management plan. How

effective is a risk management plan if cost overruns and schedule slippages are always allowed

and how effective will a risk management plan be if developed by the VP of Accounting and

Finance in seclusion?

b) Name and describe TWO (2) appropriate tools that the VP could use to assist in managing risk

on these projects where she to accept Aldanes suggestion.

c) While managing quality on one of the Capital Equipment Projects, the VP assigned Crystal the

task of developing the control chart below. Crystal found the sample mean to be 40 and the

upper and lower control limits 60 and 25 respectively. She constructed the control chart below.

Given what is depicted, help her determine if the process in or out of control. Explain how you

arrived at your decision and advise Crystal on 2 additional tools that could be used in managing

project quality.

UCL = 60

LCL = 25

QUESTION 3

a) Romar Taylor was hired as a Project Consultant who then hired Patricia to be his assistant.

Patricia has just completed a project management course at UWI and based on her newly

acquired knowledge she has suggested that weekly meetings should be a must as

communication is key to the success of the project. She further stated that Good

communications channels must be established between all resource managers. She has

identified 6 such resource individuals with whom she needs to communicate. Due to some

internal and external organizational changes, two new workers have been added with whom she

needs to communicate. She also had to add an external contractor, Marlon Reid.

What is the maximum number of communication channels possible, and should Patricia utilize

all of them in this situation? Justify your recommendation.

b) Sasha Gaye assigned Richard Green, a member of the project team, a work package on the

largest project which needs to be completed in 12 months. The approved budget for this set of

activities is 300,000 USD and the activities will be executed with a constant burnt rate (the

same amount is spent every month). 4 months have passed, and Richard has spent some

120,000 USD. Upon close review, he finds that only 35% of the work has been completed.

Judith, a Cost Portfolio Management expert is being asked to assist Richard by calculating and

analyzing the following:

I. the Schedule Performance Index (SPI) and Cost Performance index (CPI)

II. the Estimate at Completion (EAC) and the Variance at Completion (VAC), should no

measures be taken to correct any variances identified.

III. What advice should Judith have for Richard based on the calculations above?

QUESTION 4

Sanjay Green is responsible for developing a training programme for the largest Capital Equipment

Project. The following table shows the relationships between the activities that must be completed,

along with estimates of their duration in days.

Table 1: Activity Times and Predecessors

You are required to help Sanjay by carrying out the following tasks:

i. Prepare a network diagram.

ii. Calculate and show in a table or otherwise, the project activity schedule (ES, EF, LS, and LF)

as well as activity time and slack.

iii. Identify the activity(s), which if delayed, will delay the entire project.

iv. Determine the critical activities and hence the critical path for this project.

v. Determine the expected completion time. This should not be done by inspection but should be

based on part (iv).

vi. Anika, his able-bodied assistant, when asked by Sanjay, advised him that the time calculated

in PART (V) is the longest time the project is likely to take. Comment on the accuracy of the

information provided by Anika to Sanjay

\( \mathrm{UCL}=60 \) \( \mathrm{LCL}=25 \) Table 1: Activity Times and Predecessors

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