The Blue Spider Case Study - Project Management Assessment Answer

Assessment Task:

The Blue Spider Case Study Project Management Assessment Answer

This is impossible! Just totally impossible! Ten months ago I was sitting on top of the world. Upper-level management considered me one of the best, if not the best, engineer in the plant. Now look at me! I have bags under my eyes, I haven’t slept soundly in the last six months, and here I am, cleaning out my desk. I’m sure glad they gave me back my old job in engineering. I guess I could have saved myself a lot of grief and aggravation had I not accepted the promotion to project manager.”

HISTORY Gary Anderson had accepted a position with Parks Corporation right out of college. With a Ph.D. in mechanical engineering, Gary was ready to solve the world’s most traumatic problems. At irst, Parks Corporation offered Gary little opportunity to do the pure research that he eagerly wanted to undertake. However, things soon changed. Parks grew into a major electronics and structural design corporation during the big boom of the late 1950s and early 1960s when Department of Defense (DoD) contracts were plentiful. Parks Corporation grew from a handful of engineers to a major DoD contractor, employing some 6,500 people. During the recession of the late 1960s, money became scarce and major layoffs resulted in lowering the employment level to 2,200 employees. At that time, Parks decided to get out of the research and development (R&D) business and compete as a low-cost production facility.

while maintaining an engineering organization solely to support production requirements. After attempts at virtually every project management organizational structure, Parks Corporation selected the matrix form. Each project had a program manager who reported to the director of program management. Each project also maintained an assistant project manager—normally a project engineer—who reported directly to the project manager and indirectly to the director of engineering. The program manager spent most of his time worrying about cost and time, whereas the assistant program manager worried more about technical performance. With the poor job market for engineers, Gary and his colleagues began taking coursework toward MBA degrees in case the job market deteriorated further. In 1995, with the upturn in DoD spending, Parks had to change its corporate strategy. Parks had spent the last seven years bidding on the production phase of large programs. Now, however, with the new evaluation criteria set forth for contract awards, those companies winning the R&D and qualiication phases had a deinite edge on being awarded the production contract. The production contract was where the big proits could be found. In keeping with this new strategy, Parks began to beef up its R&D engineering staff. By 1998, Parks had increased in size to 2,700 employees. The increase was mostly in engineering. Experienced R&D personnel were dificult to ind for the salaries that Parks was offering. Parks was, however, able to lure some employees away from competitors, but it relied mostly on the younger, inexperienced engineers fresh out of college.

With the adoption of this corporate strategy, Parks Corporation administered a new wage and salary program that included job upgrading. Gary was promoted to senior scientist, responsible for all R&D activities performed in the mechanical engineering department. Gary had distinguished himself as an outstanding production engineer during the past several years, and management felt that his contribution could be extended to R&D as well. In January 1998, Parks Corporation decided to compete for Phase I of the Blue Spider Project, an R&D effort that, if successful, could lead into a $500 million program spread out over 20 years. The Blue Spider Project was an attempt to improve the structural capabilities of the Spartan missile, a short-range tactical missile used by the Army. The Spartan missile was exhibiting fatigue failure after six years in the ield. This was three years less than what the original design speciications called for. The Army wanted new materials that could result in a longer life for the Spartan missile. Lord Industries was the prime contractor for the Army’s Spartan Program. Parks Corporation would be a subcontractor to Lord if it could successfully bid and win the project. The criteria for subcontractor selection were based not only on low bid but also on technical expertise as well as management performance on other projects. Parks’s management felt that it had a distinct advantage over most of the other competitors because the company had successfully worked on other projects for Lord Industries.

THE BLUE SPIDER PROJECT KICKOFF

On November 3, 1997, Henry Gable, Parks’s director of engineering, called Gary Anderson into his ofice and said: Gary, I’ve just been notiied through the grapevine that Lord will be issuing the request for proposal [RFP] for the Blue Spider Project by the end of this month, with a 30-day response period. I’ve been waiting a long time for a project like this to come along so that I can experiment with some new ideas that I have. This project is going to be my baby all the way! I want you to head up the proposal team. I think it must be an engineer. I’ll make sure that you get a good proposal manager to help you. If we start working now, we can get close to two months of research in before proposal submittal. That will give us a one-month’s edge on our competitors. Gary was pleased to be involved in such an effort. He had absolutely no trouble in getting functional support for the R&D effort necessary to put together a technical proposal. All of the functional managers continually remarked to Gary, “This must be a biggy. The director of engineering has thrown all of his support behind you.” On December 2, the RFP was received. The only trouble area that Gary could see was that the technical speciications stated that all components must be able to operate normally and successfully through a temperature range of –65°F to 145°F. Current testing indicated the Parks Corporation’s design would not function above 130°F. An intensive R&D effort was conducted over the next three weeks. Everywhere Gary looked, it appeared that the entire organization was working on his technical proposal. A week before the inal proposal was to be submitted, Gary and Henry Gable met to develop a company position concerning the inability of the preliminary design material to be operated above 130°F. Gary Anderson: “Henry, I don’t think it is going to be possible to meet speciication requirements unless we change our design material or incorporate new materials. Everything I’ve tried indicates we’re in trouble.” Gable: “We’re in trouble only if the customer knows about it. Let the proposal state that we expect our design to be operative up to 155°F. That’ll please the customer.” Anderson: “That seems unethical to me. Why don’t we just tell them the truth?” Gable: “The truth doesn’t always win proposals. I picked you to head up this effort because I thought that you’d understand. I could have just as easily selected one of our many moral project managers. I’m considering you for program manager after we win the program. If you’re going to pull this conscientious crap on me like the other project managers do, I’ll ind someone else. Look at it this way;

later we can convince the customer to change the speciications. After all, we’ll be so far downstream that he’ll have no choice.” After two solid months of 16-hour days for Gary, the proposal was submitted. On February 10, 1998, Lord Industries announced that Parks Corporation would be awarded the Blue Spider Project. The contract called for a 10-month effort, negotiated at $2.2 million at a irm-ixed price.

SELECTING THE PROJECT MANAGER

Following contract award, Henry Gable called Gary in for a conference. Gable: “Congratulations, Gary! You did a ine job. The Blue Spider Project has great potential for ongoing business over the next 10 years, provided that we perform well during the R&D phase. Obviously you’re the most qualiied person in the plant to head up the project. How would you feel about a transfer to program management?” Gary Anderson: “I think it would be a real challenge. I could make maximum use of the MBA degree I earned last year. I’ve always wanted to be in program management.” Gable: “Having several masters’ degrees, or even doctorates for that matter, does not guarantee that you’ll be a successful project manager. There are three requirements for effective program management: You must be able to communicate both in writing and orally; you must know how to motivate people; and you must be willing to give up your car pool. The last one is extremely important in that program managers must be totally committed and dedicated to the program, regardless of how much time is involved. “But this is not the reason why I asked you to come here. Going from project engineer to program management is a big step. There are only two places you can go from program management—up the organization or out the door. I know of very, very few engineers who failed in program management and were permitted to return.” Anderson: “Why is that? If I’m considered to be the best engineer in the plant, why can’t I return to engineering?” Gable: “Program management is a world of its own. It has its own formal and informal organizational ties. Program managers are outsiders. You’ll ind out. You might not be able to keep the strong personal ties you now have with your fellow employees. You’ll have to force even your best friends to comply with your standards. Program managers can go from program to program, but functional departments remain intact. “I’m telling you all this for a reason. We’ve worked well together the past several years. But if I sign the release so that you can work for Elliot Grey in program management, you’ll be on your own, like hiring into a new company. I’ve already signed the release. You still have some time to think about it.

QUESTIONS

1. If you were Gary Anderson, would you have accepted this position after the director stated that this project would be his baby all the way?

2. Do engineers with MBA degrees aspire to high positions in management?

3. Was Gary qualiied to be a project manager? 4. What are the moral and ethical issues facing Gary?

5. What authority does Gary have and to whom does he report?

6. Is it true that, when you enter project management, you either go up the organization or out the door?

7. Is it possible for an executive to take too much of an interest in an R&D project?

8. Is it customary for the project manager to prepare all of the handouts for a customer interchange meeting? 9. What happens when a situation of mistrust occurs between the customer and contractor? 10. Should functional employees of the customer and contractor be permitted to communicate with one another without going through the project ofice?. Is it customary for the project manager to prepare all of the handouts for a customer interchange meeting?

9. What happens when a situation of mistrust occurs between the customer and contractor?

10. Should functional employees of the customer and contractor be permitted to communicate with one another without going through the project office?

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