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Case Study of B&W Systems



It is increasingly difficult to ignore the fact that business needs a constant improvement in order to compete at the target market. However, it is worth saying that any considerable improvements within an organization are supposed to be arranged in a particular layout. Subsequently, they have to meet certain reasonable objectives because otherwise, the organization is likely to face a drastic loss. In other words, every single organization starts launching projects sooner or later. Consequently, the entire discipline of project management has emerged. However, it is essential to note that numerous issues regarding successful projecting have raged unabated. To some extent, it is certainly obvious fact because every single case requires a special approach. Taking these points into account, it is to be said that the following paper lingers upon the discussion of B&W case study of launching a project concerning the development of cloud-based forecasting software named Forecasto.

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To be more exact, the following study is presented in the business report style, which is particularly focused on three main considerations. In such a way, critical path has to be evaluated in order to reveal the implications on the minimum time for completion of the project and real time span for a full accomplishment of all tasks for this project. Then, additional costs are supposed to be discussed in order to predict the amount of costs, which can be potentially needed for the reduction of time for the project completion. Further, behaviour of crash curve has to be verified with appliance of linear programming in order to distinguish the current state of this curve. Eventually, as the thesis and the layout of the paper have been outlined, it is necessary to proceed to the following section.

Objectives

Speaking about the objectives of the given case study in a more specific way, first it is necessary to note that the discussion of critical path presupposes the estimation of minimal time for completion of the project and time, which is the most apt for a total accomplishment of all the tasks within the project. Actually, it can be explained by the fact that Bob Philips needs to know to what extent the project can be possibly shortened and whether the project has settled feasible objectives for such period. Doubtless, this objective is directly connected with the next one.

As for the discussion of the additional costs, it should be noted that this objective implies the evaluation of currently provided costs for reduction of time for the completion of the project. Besides that, it is worth mentioning that the project is desired to be completed within 35 weeks. Therefore, additional costs for reduction of time are tending to be reconsidered. It is quite important project that is why B&W has made a decision that it should be completed even though it implies certain obstacles. Thus, costs are no object. However, it is essential to remember that these costs depend heavily on the behaviour of crash curve.

Hence, this behaviour is supposed to be distinguished, as well. As it has been already mentioned, the means of linear programming should be applied. The main purpose of this verification is distinguishing whether crash curve is linear. It is crucial regarding the current phase of the project. It is needless to say that this procedure has to be conducted beforehand. Otherwise, the costs may be divided in the irrelevant way. In addition, in case the curve occurs to be linear, it will provide the management with a natural pattern of cost spending. However, it still has to be properly interpreted.

Critical Path

Speaking about the evaluation of the given time frames for the completion of the project, it is important to refer to the scope of the project, which does not seem to be vividly outlined. To start with, the feasibility of this project is quite low due to numerous reasons. In fact, such technology as Cloud Computing is a relatively new technology within the sphere of information technologies and it is usually popular within large enterprises. It can be explained by the fact that the technology itself is quite expensive and requires considerable amounts of costs for its implementation. Therefore, B&W takes quite serious responsibility because Forecasto is supposed to be vastly simplified so that small and medium organizations can implement it. Still, providing that the simplification is not a concern, approximate price of $200 per one unit is evidently cheap for such up-to-date technology. Hence, the project team is expected to verify whether B&W Company is capable of such progress because the simplification of cloud-based technologies is commonly recognized as its central issue.

Taking this point into consideration, the company is recommended to find some investors, which will be particularly interested in the investing in this project. It is needless to say, that these investors have to be potentially related to small and medium business or oriented at the sphere of information technologies. In such a way, the offer will be underpinned not only by the consideration of returns on investment but future prospects of partnership, as well. What is more, it would be quite reasonable to offer a partnership with certain governmental organizations, which can be also interested in the technologic development of the area. Still, there are some other concerns regarding the proper timing and scoping of the project. Thus, it is necessary to move on their discussion.

To return to the subject, it should be admitted that the minimal period for such a serious project is one year proving the outlined amount of costs. Actually, it can be explained by a wide range of improvements, which the designing team is supposed to incorporate in Forecasto. However, it is a quite reasonable decision to utilize the existing components of software for the personal estimation of the project metrics. However, 35 weeks is definitely a short term and the enlarging of costs for its reduction is not a reasonable decision. On the contrary, it should be said that the project would take two years in order to adjust cloud technology to a small and medium business. Nevertheless, the involvement of investors is not a crucial point in these terms because the technology itself requires certain period for being multiply tested.

Despite of the fact that crash costs for development will be doubled, $130, 000 will not solve the problem of time. To the broadest extent, Bob Philips needs to suggest the denial of the development of the project because it is not properly scoped. Nonetheless, as the project has not been actually launched, it is pivotal to outline the described reconsiderations of the project’s scope. The project will open numerous prospects for the entire company, but the management should realize that the launching of the project with its current state is a preposterous decision. Besides that, it should be noted that proper timing is not the main concern regarding the project. In fact, this project requires a serious scientific involvement that is why external support of knowledge is essential. Consequently, additional costs will be needed. In such a way, it is increasingly apparent that the costs should be discussed with the reference to the timing of the project.

Therefore, it would be quite appropriate to apply the internal rate of return. To be more specific, this model suggests that returns are calculated according to the current state of the project, especially regarding investment support (Kloppenborg, 2012). As a result, this model provides the project with flexible budgeting so that the costs will not be wrongly estimated. Moreover, regular report of IPs will clarify the current situation, as well. Though, the main responsibility is referred to the designing team, who are on duty for the factual development of the simplified software for small and medium business. To get back to the point, it is important to place the emphasis on the costs rather than on time because the excessive cost may lead beyond the margin: the project will possibly require more and more costs and will never be completed as a matter of fact. Hence, flexibility of budget is an essential aspect of this project.

Providing the fact that none of the investors will be found, the company would still be capable of launching the project. As it has been mentioned before, time is not the primary paradigm in terms of this project. Despite of the fact that the key competitors may launch the same projects, it should be noted that the company is able to be the first one, which will lead to the development of cloud-based technologies in such direction. To put it in a simpler way, the outcomes of this project are worth waiting. As a result, the firm will be able to patent this software because it is likely to obtain the extents of the disciplinary significance. Namely, new approaches and trends will surely emerge. Overall, Bob Philips is strongly recommended to insist on the reconsideration of the project scope regarding the time and costs.

Additional Costs

With regard to the additional costs for the reduction of the time frame, it is worth saying that even doubled costs will not improve the situation considerably. In case the crash costs for the development are $65, 000, the doubled amount is still insufficient due to the reasons, which have been mentioned previously. Still, Bob Philips does not have just to challenge all the assumptions of the vice president but to suggest his own in order to sound more convincing.

For starters, it should be admitted that additional costs are required to serve quite different considerations. To be more precise, additional funds do not necessarily have to be provided for the reduction of time for the project. Having considered the peculiarities of the software, which is expected to be developed and simplified, it is quite reasonable to devote substantial costs to the technologic and scientific basis of the software design. Again, it is important to place the emphasis on the results rather than on the terms of the project. To the broadest extent, none of the key competitors is capable of designing the same software in such a short time because it is not empirically possible. Therefore, Bob Philips needs to outline a certain plan, which will suggest the involvement of the credible researchers and software designers within the sphere and reasonable costs, with which the company will be able to provide the project. Nonetheless, many people would argue that it is a total deviation from the outlined approach of the company. Thus, it is worth saying that it is generally the matter of ethics because the vice president is expected to take into consideration the suggestions of the subordinates. What is more, the intention of Bob Philips is quite honest. Thus, he needs to suggest the following approach.

In fact, the following plan is comparatively sophisticated because it requires the combination of internal rate of return model with bottom-up cost estimation. Speaking about bottom-up estimation, it is to be said that this method calculates every separate activity within the project. As a result, the accuracy for the current and additional costs is relatively precise (Hill, 2010). Hence, Bob Philips is advised to suggest such combination in order to underpin the financial credibility of the reconsidered scope of the project. Doubtless, such mixture requires a distinct framework that is why Bob Philips also needs to outline the basic limitations to this approach. In such a way, internal ration of return is expected to align the overall flow of costs while bottom-up cost estimation should be related to every single activity within the project. Consequently, the economizing on costs will not go beyond the margin of maximal savings. However, it is pivotal to remember that external investing is still quite appealing decision.

Therefore, the company has to launch a certain campaign concerning this issue. Conversely, there are some peculiarities, which Bob Philips has also take into account. Public presentation of the project is expected to be successful because this idea can be easily obtained by the key competitors of B&W. In fact, it is possible to design some corporate advertising, which will attract potential investors. Similarly, the firm may contact related governmental organizations, which will provide the project with additional funds, human resource, or equipment. Regarding this point, it should be noted that the main purpose is not costs themselves but their efficient use: effective performance of the designing team, up-to-date technologies, external consulting of the project, etc. Taking into consideration all these points, it is still possible to argue that such recommendations for Bob Philips are quite irrelevant to the entire case. Thus, it is important to provide some other justifications regarding the reconsideration of the project’s scope.

In fact, the initial outline of the project is more preposterous than it seemed for the first time. Actually, the project requires certain orientation during its process of the implementation. It is increasingly apparent that need for costs, machinery and human resource may vary. Therefore, additional funding will not reduce the time because these costs may support the aspect, which is not facing hardships at the moment. In other words, there is no use of funding the development of interface designing while the security considerations of the software evidently lack the relevant resources. Hence, it is necessary to mark the project life cycle with milestones, which will identify certain progress within the project. Together with a combination of IRR and bottom-up cost estimation, additional costs will be evaluated in the most accurate way with respect to a particular time frame. In such a way, additional costs have to be spent on the quality of the project rather than on its terms.

Probably, one may still argue that two years is quite threatening tendency for the project, but it is important to emphasize on the quality of the project. The organization is planning to develop entirely new software for cloud-based technologies that is why 35 weeks is obviously a short period, which is likely to be prolonged endlessly. Thus, it is evidently better to settle a substantially longer terms in order to achieve an effective result, which will be definitely beneficial for the company and the entire sphere of information technologies. Eventually, it is the main strategy for Bob Philips’ speech at the next board meeting. It may seem to be quite straightforward, but the organization should not lose such a chance because otherwise, the key competitors will consider the mistakes of B&W and developed the same project.

Behaviour of Crash Cost Curve

Despite of all the suggestions for Bob Philips, it is still important to take into consideration the behaviour of crash cost curve because it is the main determiner of additional costs for the project. It is quite serious issue that is why it needs to be discussed independently. In fact, it is important to forecast the pattern of this curve in order to make the funding schedule more or less flexible. In case the curve occurs to be non-linear, a certain backup of funds has to be initiated. To return to the subject, it is increasingly apparent to distinguish the method of linear identification. In other words, a certain linear technique has to be applied. Providing that its outcomes are positive, crash cost curve is definitely linear. Hence, it is necessary to choose the method, which can be applied to the overall purposes of the project. Namely, it is necessary to create a preliminary orientation for cash flow and outflow margins.

Consequently, it is necessary to apply the technique of development of minimal feasible solution. To be more precise, this technique takes a certain stable, which is considered as a low boundary of cash flow. Then, it calculates all the possible outcomes with regard to the initially settled variables. As a result, the processing of this data outlines the minimal set of variables, which keep the flow above the low margin (Gass, 2003). In fact, it is only the first state of the behaviour identification because minimal feasible solution is an evidence of non-linear behaviour of the curve. In such a way, it is necessary to distinguish the behaviour of the curve in terms of its linear character.

By the way of contrast, the linear environment can be created by the calculation of the maximal feasible solution. In fact, the high flow margin is taken for the stable, which is processed with potentially highest variables. In a like manner, the result will demonstrate the maximal feasible solution (Kanda, 2011). However, there are many Bob Philips’ colleagues who are not informed regarding the actual behaviour of the crash cost curve. Thus, it is not possible to predict its behaviour because the project should be re-scoped so that any estimation does not render any practical use. What is more important, the organization will be capable to align its funding strategy of the project in accordance with both these calculations. Doubtless, a particular choice of the pattern depends heavily on the progress of the project. However, it is crucial to note that some implications emerge concerning this approach. Those implications will be described later.

Subsequently, Bob Philips has to emphasize the need to create certain milestones, which will independently signal about the switching on the non-linear pattern and vice versa. In fact, the actual handling of this procedure can be embodied by the amendments of the additional costs. Namely, as soon as the curve reaches certain milestone, the additional cost budget is amended in accordance with the opposite variables. Having described the main principle of determination of the behaviour for crash cost curve, it is necessary to return to the subject of the implications for this flexible approach.

First of all, it is crucial to note that that the project is not protected from the external influence. As a result, the behaviour of the crash cost curve can be changed without the involvement of the project team. In other words, the value of certain milestones may occur to be wrongly estimated so that the additional costs are divided improperly. Thus, regarding this implication, Bob Philips has to suggest that the company needs to create independent financial reserves for such sort of emergencies. However, the value of the entire project can be still overestimated that is why the suggestion to keep the idea of the project for the better times is quite reasonable.

Simultaneously, it is worth saying that linear behaviour is usually typical for the projects, which are started with the low level of the team’s experience (Jaber, 2011). Therefore, such team needs to follow a particular pattern while comparatively experienced team may follow a flexible pattern, which depends on the current progress of the project. Taking this point into consideration, it is to be said that B&W should use non-linear pattern only at the explicit level because the project presupposes quite meaningful amount of work, skills and experience, which many professionals evidently lack. Eventually, this evidence can be witnessed by a tendency of curve to obtain a so-called L-form. Actually, L-curve implies an assumption of low capacity of the team to complete the project at the settled deadline.

Surprisingly, it is what the company currently needs. To put it in a simpler way, the firm needs a strict and accurate pattern for crash costs curve. Doubtless, it will prolong the project considerably, but the organization will benefit from such sophisticated approach. Subsequently, many colleagues of Bob Philips may argue that this suggestion is excessively saving-oriented and it would be much better to launch the project in terms of risk management model. In contrast, it is increasingly obvious that such risks are quite high so that a minor failure may outcome in considerable losses for the entire company. In consequence, Bob Philips needs to insist on the safer approach.

Conclusion

To conclude, it should be admitted that this paper has lingered upon the case study of B&W Systems, which is going to launch the project of cloud-based software for small and medium business named Forecasto. In fact, the director of operations, Bob Philips is seeking to the advice regarding the following issues of the project. Actually, the paper has given an account to the critical path of the project. As a result, the initial suggestions for this project have been revealed to be quite inappropriate because the project has been scoped without respect to the capacities of the firm as a matter of fact. What is more, the software, which has been expected to be designed in 35 weeks, requires much more time for the development because cloud-based technologies are known to be particularly utilized by big enterprises as long as they are quite expensive and hard to implement. In fact, it is the central issue of the entire case study so that additional costs and the behaviour of crash cost curve have been discussed with the regard to this point.

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