Case Study : Free Choice Project Management Company

PART (A)

You are working as a project management manager in Free Choice Project Management Company. KFN food production company is planning to upgrade outside space in front of the organisations buildings. The KFNs representative contacts your company to help with managing this project costs. Currently, there is a concrete area with no greenery, and the company would like to enhance appearances of this area to create an area for employees to spend breaks. KFN company is planning to start the project on June 24^th and the board directors would like it completed by the end of July at the latest. Therefore, you would need to help KFN company to complete this project. Further details are identified as followed:

There are five major components of the project:

• Concrete removal
• Turf/lawn
• Planting
• Paving
• Shaded area.

Please follow instruction below in your role play activity or this will be further instructed by your trainer, and only the relevant stakeholder should read the details below.

FOR STAKEHOLDER ONE ONLY

You will provide information on the concrete removal and turf/lawn components of the project:

• Concrete removal:
• first task in the project and requires outside services to be hired
• employees to be informed of the construction work one week before the project commences
• area to be surrounded by barriers and warning signs
• access required for company equipment and removal lorries
• 100m of concrete to be removed
• specialist company required for five days
• removal company required for one day
• Turf/lawn:
• 50m top soil and 50m turf required
• specialist company required for five days
• company to return one week after the turf has been installed to add treatment
• ten signs required to ask employees not to walk on the grass (one month only).

FOR STAKEHOLDER TWO ONLY

You will provide information on the planting and paving components of the project:

• Planting:
• 465 plants required (to cover 20m)
• planting to be staggered according to size and placement
• specialist company required for five days
• sprinkler system required and connection to water source
• Paving:
• 30m paving slabs required
• specialist company required for four days
• barriers and signage required for two days.

FOR STAKEHOLDER THREE ONLY

You will provide information on the shaded area component of the project:

• Shaded area:
• 20m 165gsm polyester material
• six wooden posts
• assortment of fixings, e.g., stainless steel D-rings
• specialist company required for one day for installation
• selection of benches, chairs, and tables.

PART (B)

The below list identifies the current costs of materials and services required for the project of KFN company to improve outside area.

• Turf: $35 per m
• Turf labour: $150 per day
• Top soil and labour: $15 per m
• Project manager: 25 hours ($45 per hour)
• Concrete removal companies: $6,500 (groundwork) and $3,400 (removal)
• All safety and warning signage: $155
• 465 plants: $3,325
• Planting company: $150 per day
• Sprinkler system, installation, and connection: $680
• Paving: $42 per m
• Paving specialist company: $220 per day
• Shade material: $18 per m
• Wooden posts: $35 each
• Shaded area fixings: $135 (approximately)
• Shading installation: $290

Benches, chairs, and tables: 5500 (budget).

PART (C)

The organisation received your project budget and cost-management plan, and the directors have agreed on a budget of $30,000.

Work commenced on June 24^th as planned and you now have two weeks of actual expenditure to monitor against the budget.

Project component progress:

• Concrete removal completed in six days: $9,900 + $600 (company required extra morning to take remaining concrete)
• Turf has been delayed due to the bad weather (approximate five days behind schedule)
• Plants ordered and received (ready for planting company to arrive): $3,000 (offered a discount because it was a large order)
• Shade installation team have recommended a different material that is more suitable for wet weather: $20 per m.

PART (D)

Below are the notes taken during the project to create a greener space outside of the organisations buildings. The project is now complete, and you have been asked to provide a basic financial report.

As a reminder, initial estimations totalled $27,970 and the organisation allowed $30,000 as the budget.

• Concrete removal:
• specialist company successfully broke up existing concrete within the estimated timeframe, cost $6,500 as agreed
• removal company underestimated the amount of concrete to be removed and required an extra day with another available lorry, extra $600 ($4,000 total)
• signage and safety issues implemented according to legislation; noise kept to a minimum during work hours
• all signage required cost $100 ($155 estimated)
• colleagues volunteered time to help lorries access the area
• Turf/lawn:
• 50m turf ($1,750) and 50m topsoil/labour ($750) as agreed
• turf labour increased by three days due to bad weather, budgeted $900 (actual cost $1,350)
• Planting:
• plant order (465 plants) large enough to warrant discount, budgeted $3,325 (actual cost $3,000)
• planting company needed four days to complete project (budgeted $750, cost $600)
• sprinkler system, installation and connection totalled $680 (as budgeted)
• new costing required for ongoing utility charges (water, $65 extra per month)
• Paving:
• 30m paving purchased ($1,260) and 5m not required (return value $210)
• paving specialist company required for four days ($880 as agreed)
• Shaded area:
• changed material as recommended by specialist, new cost is $20 per m (20m)
• 6 x wooden posts ($35 each)
• shading installation required further digging work, new cost $350 (estimated $290)
• shading fixings came in at $255 (estimated $135)
• 3 x benches ($1,000), 20 x chairs ($3,500), 5 x tables ($1,500) budgeted $5,500
• Other:
• project manager worked extra 10 hours over the agreed 25 ($45 per hour).

PART (E)

The organisation has created a document to outline the requirements of the finalisation process.

You must:

• Check all components of the project are finished
• Identify any variances to the Critical Path Schedule (CPS)
• Check activity completions and ongoing requirements
• Identify key future dates for checks and maintenance.

Organisational standards:

• Project financial plan complete when objectives have been formally accepted and approved
• Acceptance and approval needed from project sponsor and stakeholders
• Signatures required on all approval documentation
• Variances to be noted and explained on reports.

You must submit:

• Budgets, commitment/schedule, expenditure
• Cash flows
• Lessons learned
• Cost-management plans
• Invoice and payment summaries
• Lists of future potential costs
• Project files and records
• Quotations and invoices
• Recommended and approved courses of action

Stakeholder reports.

(a) Use a provided table to calculate and complete critical path schedule using the progress information detailed in the Case Study PART (C).

WBS componentCurrent dateTitleBudgetActualDifference

(b) When monitoring actual expenditure against budget in question 1, summarise and explain how the project progress is going.

(c) Identify the four formulas for the following cost variation calculations and give a brief description of their usage:

• Schedule variance
• Schedule performance index
• Cost variance
• Cost performance index.

(d) You have carried out an analysis to evaluate alternative actions. The analysis has revealed low productivity. Identify four possible reasons why there may be low productivity and how this can be remediated.

(e) Briefly explain the following characteristics of implementing agreed actions to maintain any financial objectives:

• Realistic
• Clear
• Measurable.

(f) Briefly describe the essential components of monitoring and reporting agreed actions.

(g) Summarise the following three (3) corrective actions:

• Action
• Change
• Forecast

(h) Using the information provided in case study PART D, complete a financial report by using the following template:

Guideline: the learner is provided example answer in the orange letters at below table

Project PhaseBudgeted CostActual CostCommentsConcrete removal$9,900$10,500Removal company required extra dayTurf/lawn Planting Paving Shaded area Other

(i) Identify three (3) activities that you may conduct to signify the completion of a project.

(j) Refer to case study PART E, create a checklist of activities required to signify financial completion according to the task and organisational requirements listed.

Checklists must cover:

• Overall finalisation processes
• Specific organisational activities
• Records to be finalised.

(k) Refer to provided case studies from A-E where require, Review the overall project outcomes by confirming the following elements:

• Were the estimated costs roughly accurate?
• What was the total cost overall?
• Was the total cost in line with budgetary expectations and allowances?
• Did the individual elements of the project meet cost expectations?
• What elements of the project were under- or overspent?
• What were the lessons learned?
• Did any contingencies occur?

(l) List five (5) potential cost-management issues.

(m) Create an advice checklist you could share with colleagues when reviewing cost-management issues.

(n) From provided case studies of PART A-E, review and identify two (2) areas of cost-management issues and suggest improvements.