This project takes place in South Australia. In September 2000, ACME Fabricators

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This project takes place in South Australia. In September 2000, ACME Fabricators advised its staff that their new factory and offices out in semi-rural Angle Vale would be ready for completion by the end of April 2002. ACME was a responsible company and liked to keep their premises clean and tidy and their staff happy. The new premises at Angle Vale were developed on a 4.5-hectare site, previously used for grain crops. Consequently, ACME decided that significant landscaping would be required to enhance the amenity of the otherwise bare land. The senior executive group pictured some land contouring with an attractive green lawn, and trees and shrubs to soften the impact of otherwise stark commercial buildings. Accordingly, they notionally allocated $232,000 for the project, and developed a tender document that called for the work to be completed by the time they moved to the new premises. They then invited proposals for landscaping and quotes for the work. A company called Arbor Industries submitted an artist's sketch for the ACME evaluation team to picture what the landscaping would look like. Arbor was selected with a bid of $175,000, substantially lower than any other submission. Arbor then prepared a detailed landscaping plan based on existing drawings of the site provided in the tender. Arbor met with the ACME senior executives to agree project start date, access and security of plant and equipment, and a fixed price contract. A contract was duly signed. The project was scoped and planned by Arbor, with specific milestones for site works, irrigation, turf laying, and tree and shrub planting. Arbor had undertaken many similar jobs on city sites in the past and based on the knowledge and skills of the project team, they did not think that a formal project management plan would be needed. All they wanted was agreement on the scope of the project and the key deliverable dates. From experience, they wanted to deal with only one person from ACME and it was agreed that the finance manager, a senior executive, would be responsible for the project. Arbor commenced work on the 16th of November 2000 with site preparation including weed eradication. Work progressed smoothly until 20th of January 2001, when heavy vehicles delivering machinery, plant and equipment to the site significantly damaged the newly prepared and leveled ground for the lawn. The Arbor project manager arranged his first meeting with the ACME finance manager to complain that he would have to re-do the site for the lawn which would take an extra 3-5 days. The finance manager agreed that it was not Arbor’s fault and that work would have to be re-done, but as there was no more funding available he suggested that the project manager make the savings somewhere else from within the project. This was agreed but not documented. By the end of January the landscaping site works were finished and the irrigation system was installed. Planting was to be done in three phases – shrubs, bushes and small trees first, then larger trees and finally the lawn. Shrub planting would take approximately 4 days, trees 7 days and the lawn would be Two Case Studies Page 5 of 7 AEW Services, Vancouver, BC © 2004 Email: max_wideman@sfu.ca laid in three separate operations over 2 days. On the first day after the planting commenced, some of the project team noticed a few small plants seemed to be missing or broken off. These were quickly replaced. Within the first 3 days after the last planting, however, it was noted that around 35% of the plantings had been destroyed by rabbits or hares (as it was later determined. Remember, this is in Australia.) The Project Manager was very concerned and called another meeting with the ACME finance manager. Although sympathetic, the finance manager agreed that tree guards needed to be placed around trees but that was a contingency that the Arbor Company should have considered. The Arbor project manager indicated that pests were ACME’s problem and again the finance manager indicated that Arbor should make savings elsewhere within its contract. The Arbor project manager reviewed his budget and costs and determined that the only way to re-coup the losses from having to replant the shrubs and protect them, was to plant fewer plants and smaller trees which came at a much lower cost. Another way to make some savings was to try and re-design the irrigation system using fewer sprinklers. Instant lawn was tentatively ordered for around the middle of March 2001 so that delivery would miss the hottest part of the year. Unfortunately, the commercial lawn growers had heavy demand at that time and advised that the last shipment could only be made by mid-February 2001. This was necessary to allow them time to plant new lawn ready for winter and spring clients. Arbor had no choice but to accepted delivery in mid February 2001. As it turned out, it was particularly hot when the lawn delivery was made over the 2 days, with hot gusty northerly winds. By the third week of February 2001, the project was ahead of schedule by about three weeks due to the early delivery of the lawn, although the larger trees and plants had yet to be been planted. Unfortunately, water coverage of the lawn proved to be barely enough in windy conditions and, with the sprinkler head reduction, did not fully water all areas. By this time Arbor was over-budget by about $24,000. Since the original project was scoped and started, the original finance manager had secured a new position with another company and was set to leave in the third week of February 2001, just as the lawn started to brown off and die in patches. The new finance manager, who started one week later, was asked by the company to continue in the role of her predecessor on the project. The Arbor project manager, spotting an opportunity, advised the new finance manager that about $25,000-$30,000 more was needed for the project to be completed, as was agreed by the previous finance manager. The new ACME finance manager was not sure how to deal with this, having no background information on the project. She tried to contact the original finance manager but he was off on holiday prior to taking up his new position. The new ACME finance manager reviewed the budget for the project and finding that there existed a fixed price contract with no contingency amounts, notified the Arbor project manager accordingly. The Arbor project manager informed her of the problems caused by the heavy vehicles earlier in the project and the devastation by wi Two Case Studies Page 6 of 7 AEW Services, Vancouver, BC © 2004 Email: max_wideman@sfu.ca manager had reduced significantly the size of the larger trees that were to be planted later in MarchApril 2001 to try and contain the budget deficit and make savings. The project concluded with Arbor being three weeks ahead of schedule, but $25,100 (14.3%) over budget. The executives of ACME were not happy with the project at its conclusion. Through the finance manager, they indicate that the lawn was dead in patches, the plants were small and that as a result it was not like the drawing that they had been provided at tender stage. They insisted that either these issues be rectified or the contracted amount be reduced. Arbor responded that a number of verbal agreements had been reached and that Arbor had fulfilled its obligations, indeed had lost money on the contract. The dispute was then referred to the respective legal representatives of each company for resolution, but the antagonism between the parties meant that the dispute could well end up in court. Two Case Studies Page 7 of 7 AEW Services, Vancouver, BC © 2004 Email: max_wideman@sfu.ca Case Study #2: Assignment Questions As a professional project manager, you have been requested by both legal representatives to conduct a Post-Project Review. Bear in mind that you are acting independently, may be asked to give evidence, and must reflect strict impartiality. 1. How would you set about conducting such a review? 2. How would you structure your report, i.e. on what basis? 3. Would you need to seek expert advice and, if so, in what areas? Specific issues you have been asked to include: 4. Would the assignment of an ACME project manager have made a difference? 5. If so, in what way, and what specific skills would that manager have required? If you had not been acting impartially, but on behalf of ACME alone: 6. What advice would you give to ACME? 7. In a similar way, what advice would you give to Arbor?

Explanation / Answer

Answer1 : Conducting the post project review would mean participation of ll the stakeholders.The review should cover all aspects of the project work starting form he begining till the end. It should contain:

- work items that were done correctly and nicely. This would be basis the conratually defined metric like quality of delivery,time of delivery and budget containment

-work items for which there was scope of improvement.Tere might be disputes ,disagreements over such items which could have been resolved with some degree of extra effort

-Identifying the broken work items. These items were not bounded effectively by the contractual terms and conditions and were subject to interpretations .These items were completed basis verbal commitment and goodwill to avert unanticipated scenarios or change requests.There was no contractual agreement and documentation for change management.

-Action plan: Get input and agreement in place to fix the issues, budget esimates and identify ways to improve to attain long term sustainability.

The disputed items should be properly documented in detail with chain of events that lead to the change request and sufficient proof for verbal commitments or agreements from ACME to go ahead with the changes.

Answer 2: The report should be structured with inputs from stakeholder from different departments and the inputs should be captured objectively and without any bias.It should contain the context and highlights of the contract and scope of work,budget estimates and schedules. It should properly document the variances observed against each contractually defined KPIs( Key performance Indicators) However for items which cannot be objectively quantified or has not been covered under contractual T&C and arbitration should be listed out separately clearly stating the details of contetion, our and client's views and a PERT (Project Evaluation and review technique) approach for the most optimistic, mean and pessimistic estimates of cost recovery from the client basis the supporting documens so that basis te impact analysis the items can be either negotiated or fought in court of law.

Answer 3: Expert advice would required from cost control manager, change management manager to thoroughly evaluate the impact of change management , approval process and alternate options that could have helped in resolving the issues within the boundaries of contractual T&C or other cheaper cost saving alternatives. Legal experts are needed to undertand the suitable legal recourse and the cost benefit analysis.

Answer 4:The assignment of a seasoned Project manager would have definitely helped in averting the unpleasant situation. Right from the very begining ie from the time of scope freeze the project manager would have anticipated the risks and impact and prepare a risk register. Apart from that a PM wold have closely monitored the project progress and would have anchored any dispute reslution proactively. The progress would have been measured by parameters like schedule variances ,cost variances and change requests would have been properly documented and would have gone for approvals through the correct channel and hierarchy.The resource allocation and planning would have been much better and alternate measures like routing of heavy vehicles through dfferent path without tempering the lawn, pest control measures could be taken on site without much deviation from the budgeted cost of completion. Proper stakeholder management would have been done and communication would have been managed in a beter way.

Answer5 :The skills required would be:

-Risk assessment and resolution: Prepare risk registers, impact analysis , root causes and risk mitigation strategy.

- Cost control and review : Review costs from time to time using established methods like EVM(Earned value Management, PERT, CPM(Crtical path method) etc.

-Resource allocation and levelling, scheduling

-Budgeting: Review and prepare proper inhouse estimates and revise budget as per reality on ground

-Change management : Manage , document and facilitate approval change requests with due consideration of budget and schedule constraints.

-Effective communication : Keep everyone on the same page and makin everyone aware of the prject progress and issues if any

- Issue mangement: Handle unanticipated issues without disrupting project schedule, budget and compromising with quality

Answer6 ,7 : The approach for either side would be to identify and classify the items as per their priority and cost impact.The strategy for each side would be to negotiate the low cost and low impact , low cost and high impact items and strike a win win proposition. For the remaining items if negotiation is not possible then go for independent 3rd party mediation and arbitration . For items which still remain unresolved take a legal recourse.

It was not proper on Arbor's side to rely on verbal agreements and carry out the change requests without any formal approval or agreement or even without documenting the issues knowing very well that it has cost implications. Moreover the estimates for additional work was also not given before commencing the work which was both legally and ethically incorrect.The project had enouh of buffer and even after going through the approval process and due diligence the project timelines could be met easily.

Similarly ACME had acted irresponsibly. The finance person may not be the right person to overlook and take critical decisions related to project implementation or handling of issues. They needed to appoint a more competent person who could have looked into the things more holistically and would have acted more sensibly. The sole motive of the finance manager would be cost saving even though it is at the expense of quality or missed schedule. Morever the quality issues were brought into notice only after the completion of work which obviously shows that during project execution proper monitoring was not done and the issues were only brought to notice by Arbor representatives proactively.The finance manager was short sighted and never did any risk assessment even after issues started apprearing on site.

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