Problem Statement: Procurement Management

Aisha wants to join Pakistans biggest construction firm as a project manager. She is giving a case study to read it thoroughly so that a discussion could be made on this as part of interview. The project was about to construct a road between two mega cities. It was a mega project involving a lot of contracts with different vendors. The project manager had made a number of cost plus fixed fee (CPFF) type of contracts with multiple vendors. For example, a contract was made with a vendor to lease a machine. The cost of leasing the equipment is 1200 $ per day while the cost of an outright purchase is 96000 $ and a daily maintenance cost of 200 $.The duration of completing the activity for which this equipment was leased is 150 days. No evidence of contract closing were found in the documentation of project. The firm and their sponsors bear a loss at the completion of this project.

Required:

[05 marks] Identify all the mistakes made by the project manager by providing proper justification.

Problem Statement: Procurement Management

Aisha wants to join Pakistans biggest construction firm as a project manager. She is giving a case study to read it thoroughly so that a discussion could be made on this as part of interview. The project was about to construct a road between two mega cities. It was a mega project involving a lot of contracts with different vendors. The project manager had made a number of cost plus fixed fee (CPFF) type of contracts with multiple vendors. For example, a contract was made with a vendor to lease a machine. The cost of leasing the equipment is 1200 $ per day while the cost of an outright purchase is 96000 $ and a daily maintenance cost of 200 $.The duration of completing the activity for which this equipment was leased is 150 days. No evidence of contract closing were found in the documentation of project. The firm and their sponsors bear a loss at the completion of this project.

Required:

[05 marks] Identify all the mistakes made by the project manager by providing proper justification.