Case study Assignment Corwin Corporation Analysis

Formulate the Problem
Case 22: Corwin Corporation Analysis
Problem:
Corwin Corporation rushed through the process of making proposal and entering into a contract without
assessing risks and getting the buy-in from executive management board prior to making decision. As a
result, the project was not set up carefully and the more problems arose during the projects, the more
people (both external and internal) involved, leaving the project manager almost out of control over his
project. Some of the main problems I could detect in this case is:
Cost – R&D is different from a normal manufacturing contract where the estimate error on cost is more
controllable. The fixed budget for the project along with a rough draft of the cost estimate without enough
buffer amount led the project to be cost overrun, meanwhile no one could guarantee the maximum
number of tests and materials needed to make the R&D successful.
Communication – from the beginning of the project, the communication was scattered without a
consensus that set everyone related to the projects (internal stakeholders) on the same page. The inhouse representative (Ray) made communication directly to employees without giving the project
manager any heads up, and Ray reports back to his boss in different ways that the project manager has
no clue whether the client side has the whole picture of what was actually going on in the project. The
communication within Corwin Corporation also
Escalation – many problems of the problem is stuck at lower level and not escalated to the next level
sooner before the trusts are broken and miscommunication becomes overwhelmed.
Important Variables:
Controllable:
• Ray could escalate to Reddy earlier to reinforce internal policy and not letting external person
directly managing the employees, affecting their motivations and current process of the company
• Confirmation: every time a new d
• Constraints on response time, project duration and project cost imposed by Peter’s company.
• The in-house representative was selected by Diane
• The R&D project is difficult and not within expertise of Corwin
• The executive mindset at Corwin is favoring marketing in decisions and
Organizational Objectives:
Corwin Corporation focus on discovering new markets for the current existing product line, hence
marketing is considered more important than R&D, engineering. The decision-making power, the
authority for marketing department is also higher, aiming at ensuring high quality product with sustainable
profit margin (20%).
Restrictions or Constraints:
Response time for the RFP: 48 hours
Contract terms: fixed price contract for a six-month project with $125,000 down at signing and the
remaining $125,000 to be given at completion
The number of test matrix is not pre-defined. The first 5 matrixes are predetermined whereas the following
25 would be created as the project progresses.
Alternatives:
• Turn down the offers given the concern on quality of the project. If Peter cannot wait, they can
seek for other proposals and Corwin may not secure the production/manufacturing contract right
out of the first year, they can wait or Peter will have to negotiate with the third party to release that
right to Corwin given the high trust and good working relationship between Peter and Corwin.
• Assess the risks and negotiate the terms again prior to getting it signed without consensus from
management at Corwin
• Establish a working agreement when Peter wants to send an in-house representative to Corwin,
the dos and the don’ts. West should not have bypass or ignore Ray because there are more
important things to do. Because that ignorance creates risk that evolves while West chooses to
neglect.
• Include a person with higher authorization and decision making power into the project to take the
ownership of the project. Reddy did not step in to change policies, involve additional R&D people,
which all could have been done earlier.
• Communicate all the information and decisions, reasoning for decisions to all the related
stakeholders rather than letting Ray covering up part of the issues and leads to the breaking trust
with Peter even before having a thorough conversation or closure.
Assumptions:
• West was lack of people skills and was intimidated by Ray and his aggressiveness.
• West did not stress enough the project importance and reach out to upper management actively
enough (and he also did not know that the management is willing to spend Corwin’s own cost if
needed to)
• Even though West is a PM with engineering background, this project and its complexity is simply
above his individual ability for good judgement and he was overconfident during the first phase of
the project
• The organizational structure at Corwin is too rigid and the ownership is private, so it has little to
do with outside consulting or balance thinking hats at the table when making decisions
Solution Development:
While Reddy recognized from the beginning that West is not a project manager experienced in dealing
with external relationships, he should have accompanied West throughout the project, checking with
customers to see what is their take on the project, detect conflict early and tackle any miscommunication.
West as the project manager himself needs to be more considerable of his capabilities and escalate when
needed if his position power is not high enough.
Taking the lesson learned from this case, Corwin needs to reinforce the policies of how in-house
representative should be interacting with internal people at Corwin. These needs to be included while
negotiating contract term with customer to ensure that each party is given necessary authority to get
things done. A fixed price project with high technical risks will need collaboration of the both parties rather
than an unhealthy competition of egos. If the management at Corwin deems a certain project to be
important enough for the strategy of the company, then the support needs to be made clear to the project
manager, including resources allocation so that it can empower the project manager to make decisions
and own them.
Since Corwin has always been reluctant on developing its R&D capabilities, it needs to take the risk once
at a time. The company should be more open to R&D projects to prepare themselves well enough in
handling such projects in the future. The scarcity of R&D project approved within Corwin along with the
RFP from Peter has activated the unhealthy motivation in the engineering team to prove themselves,
while neglecting the fact that R&D project is risky, and the project manager should not
take the risk at the cost of the whole organization without keeping them informed.
Harold Kerzner. Advanced Project Management: Best Pract