Case Study 1 - Quantum Telecom

In June 2013, the executive committee of Quantum Telecom reluctantly approved two

R&D projects that required technical breakthroughs. To make matters worse, the two

products had to be developed by the summer of 2014 and introduced into the

marketplace quickly. The life expectancy of both products was estimated to be less than

one year because of the rate of change in technology. Yet, despite these

risks, the two projects were fully funded. Two senior executives were assigned as the

project sponsors, one for each project.

Quantum Telecom had a world-class project management methodology with five life-

cycle phases and five gate-review meetings. The gate-review meetings were go/no-go

decision points based on present performance and future risks. Each sponsor was

authorized and empowered to make any and all decisions relative to projects, including

termination.

Company politics always played an active role in decisions to terminate a project.

Termination of a project often impacted the executive sponsor's advancement

opportunities because the projects were promoted by sponsors and funded through the

sponsors' organizations.

During the first two gate-review meetings, virtually everyone recommended the

termination of both projects. Technical breakthroughs seemed unlikely, and the

schedule appeared unduly optimistic. But terminating the projects this early would

certainly not reflect favorably on the sponsors. Reluctantly, both sponsors agreed to

continue the projects to the third qate review in hopes of a miracle.

During the third gate review, the projects were still in peril. Although the technical

breakthrough opportunity now seemed plausible, the launch date would have to slip,

thus giving Quantum Telecom a window of only six months to sell the products before

obsolescence would occur.

By the fourth gate review, the technical breakthrough had not yet occurred but still

seemed plausible. Both project managers were still advocating the cancellation of the

projects, and the situation was getting worse. Yet, in order to save face within the

corporation, both sponsors allowed the projects to continue to completion. They

asserted: "If the new products could not be sold in sufficient quantity to recover the R&D

costs, then the fault lies with marketing and sales, not with us." The sponsors were noW

off the hook, so to speak.

Both projects were completed six months late. The sales force could not sell as much

as one unit, and obsolescence occurred quickly. Marketing and sales were blamed for

the failures, not the project sponsors.

QUESTIONS

2. How do we eliminate politics from gate-review meetings?

3. How can we develop a methodology where termination of a project is not viewed

as a failure?

4. Were the wrong people assigned as sponsors?

5. What options are available to a project manager when there exists a

disagreement between the sponsor and the project manager?