Hi there,

Would you please explain me how the training related to scope, time, cost and integration would help to solve company's cash flow problem?

And what would be the most challenging part to solve? Thankyou

Oleg Zahar, the CEO of the Museum Company (MC), was an architect by training and had recently been appointment to the CEO role. His biggest challenge in this new position was getting his hands around the concept of baseline costs. Baseline costs are time-phased budgets used to measure and monitor the cost performance of projects. They ensure that each phase of a project is protable and on time. Despite being very good at what it did and having a large backlog of con- tracts, MC had no positive cash ow at the end of each month. A detailed analysis revealed that the lack of cash was a result of the cash inow (money the company earned) being less than the cash outflow (money the company paid out) during the course of its projects. The only time the company's inow and outow were the same was after the completion of the projects. Thus, this lack of cash meant that the company was struggling to meet its payroll obligations and had to borrow money from the bank and incur high interest rates each month to pay its employ- ees. The high interest fees the company was paying to its bank signicantly ate away at its protability and could eventually lead to the company's collapse. BACKGROUND The Museum Company was a reputable military contractor whose main line of work was building museum exhibits. The company was founded in 19?? and its annual sales were approximately $20 million. The differentiating factor in this industry was that the military, unlike most other entities, was more concerned with the quality of its exhibits than with the cost of each one. Thus, if they were working with a reputable contractor who they had experience with they were unlikely to question the price charged for the work being done. MC was a reliable contractor that had the reputation of delivering on-time high quality exhibits among the industry players. Their reputation brought in a consistent stream of work and its pipeline was backfilled months in advance. However, despite its respectable external perceptions the internal practices of the Museum Company were questionable at best. Their biggest weak- ness, which was attributable to the lack of positive cash flow, was that they didn't negotiate payment deadlines in advance of performing/finishing work. 149 >