Section A $[60$ MAPKS$]$

Phad the case study below and answer the questions that follow.

Payton Corporation

Payton Corporntion had docided lo respond to a government RFP for the RSD phase on a new project. The statemert of Work specifiod that the project must be completed within renety itays afler go$-$ahand, and that the contract would be if a fored cost and tee. The majority of the work woutit bo accomplathod by the development lab. According to goverment Tegulations, the astmated cosi must be basod on the averaje cost of the antre cepariment, which was $$1950$ per hour, discuss the problem with the manager of the develcomant lab.

Project imanager: 'Obvibushy you know why Im hare. As the fate that you're spending money, weil overun our budget by $50$ percent."

Lab manager: 'That's your oroblem, not mine. When I estmuse the cost to do a job, I susmit only the hours necastary basod on historical standards. The pricing department, converts the hours to colars based on department averages." Project manager. "Well, Why are we using the most expensine people? Obwasty there must be lower$-$saiaried people capable of performing the work:

Lab manager: "Yes I do have lower$-$salaried people, but nose who can complete the job within the two months required by the contrat. thme to use poople hight an the leaming oure, and theyre not cheap. You should have told the pricing department to increase the average cost for the department.$\text{'}$

Project manager: $7$ wish I cosid$,$ but govemment regulations forbid this. If we were ever audted, or if this proposal were compared io ather salary structures in cher proposals, we would be in dees rochile. The conly legal way to accomplish this would be to set up a new department for those highef$-$peid employees woukting on this project. Then the average department salary would be correct. "Unforlunately the adminstrative costs of seting up a lemporary unit for only two months is prohbitive. For iong$-$duration projects, this iechnique is often employed. "Why couldn't you have increased the hours to compensate for the increased dollars required?"

Lab manager: 'I have to suberil labour justications for all hours I estimate. If I were to get audind, my job would be on the The Remember, ne had to subwit labour lastifcaton for all wot as part of the proposal. "Perhaps next lime managemert might think lwice belore tidding on a short duration project. You might try talking to the customer to get his opinion."

Project manager: $"$Hs response would probably be the sarre regardless of whether I explained the situation to him before we suomitted the proposal or now, after we have negotiated it$.$ There's a good chance that live just lost my Christmas bowis:"

Project Management Case stiviles $2$nd Edition pg $277$

H$,$ Herzner $($PhD$)$

QUESTION $1(20$ Marks$)$

$1\mathrm{.}1$ Having read the case study, there are two main constraints that need to managed by the project manager. Identily the two constraints. $(2$ Marks$)$

$12$ ldently the two knouledge areas that would assist the two constrants and elaborate on them. $(6$ Mants$)$

$1\mathrm{.}3$ idertify the methods that cois have been used by Payan Corporabicn to select a project. $(7$ Marks$)$

$1,4$ It is not clear if there was enough justification done by Payton Cop for this project, what are some of the objectives for intiating a project, Identify FIVE. $(5$ Marks$)$

QUESTION $2(20$ Marks$)$

$2\mathrm{.}1$ Why is it important to develop a detaled project plan? Advice Payton Corporation. $(8$ Maris$)$

$2.$ The project manager lalks about cost estmation based on previous activities, what tools could he have used $10$ better estimate the project costs? $(3$ Marks$)$

$2\mathrm{.}3$ What is concemed in human resources planning as they seem to affect the costing in the case study, and nhat are the key outputs? $(5$ Marks$)$

$2\mathrm{.}4$ For a project to be a success, a supportive organisational culure is needed. What do we mean when we talk atout supportive organisational culture? $(4$ Marks$)$