Name: Mark Joseph P.

Lozanta Date: August 20, 2019

Year & Section: BSI/T-3C

Chapter I: Mini-case Study

The Unpleasant Meeting of XYZ Company
(Adopted from: Project Management: Case Studies, 2013 by Harold R. Kerzner)

Everyone in the room has the “feel” that this afternoon’s meeting will not be a good one.
The selling price of XYZ Company’s stock became dramatically low. Worse, in order to conserve
cash, the firm was forced to cut the dividend payment.
Unlike this competitors, the company does not possess the capability to create new
products and sell them in the market for affordable prices. Innovation is not part of its competency.
The company is more of a follower than a leader. In reality, new products for the company are
just adding value to existing products via product modifications. Still, the company is far from
being competitive and now is struggling to survive.
People in the room suddenly became silent when Ms. Gilda Ching, the President enters
the room. She looks disturbed but still is able to wear her signature smile. As the norm, everyone
is pointing finger and blaming each other for the bad situation they are now facing. Nobody even
among the talented senior staff wanted to volunteer in solving the company’s problem.

So Ms, Gilda Ching confronter the senior staff:

“From my analysis, I know that I have spotted the main problem and I want
everyone to find solution to this trouble. I have here two exhibits to lay down the facts. The
first exhibit (See Exhibit 1) shows the five projects that are totally failures. Out of the five,
three projects have consumed most of our talented people yet no new products were
created. You will observe too in what phase of the project life cycle we made the decision
to prematurely terminate some of them. Others were already finished when we found out
that the projects have no productive results. In the second exhibit (See Exhibit 2) I
presented the money that was wasted for these projects. Actually these are millions of
pesos. Most of you are blaming our process of portfolio selection of projects. Well, we can
always improve gentlemen. We all agreed on the criteria for selection, right? Any executive
in this room who thinks that all projects would be a success is a fool. Though the rate of
five failed projects out of ten is a bad record and is really alarming.”

As the second exhibit was being presented to Ms. Ching, hardly anyone is moving. There was a
serious dead silence. No one has the idea of who might catch the furious blame form Ms.
President.

Ms. Ching continued:

“Of course some projects will fail. Why have we misspent so much money by
waiting until we get to the last two phases of the project life cycle before we admit that the
project could probably be a failure? Come on, project managers! You should have been
braver to report project failures in the earlier phase so we can cancel.”
Exhibit 1: Identification of Failures per Phase in the Product Life Cycle

RESOURCES
STRONG AVERAGE WEAK

LIFE CYCLE 1
PHASES A
2
E C
3
B D
4

Everyone after that stared at Mr. Aldo Ortiz, the Vice President for Engineering and R&D
for his reply to the challenge of Ms. President. Most of the project managers are engineers who
report directly to Mr. Ortiz and are loyal to him.

Exhibit 2: R&D Terminations Costs and Reasons for Failure

Project Original Budget Expenditure at Reason/s for Failure

Termination
A Php. 2,200,000.00 Php. 1,150,000.00 Too optimistic objective.
B 3,125.000.00 3,000,000.00 Could not rally make
breakthrough.
C 2,200,000.00 1,735,000.00 Vendors could not perform well.
D 5,680,000.00 5,600,000.00 Product safety test failures.
E 4,900,000.00 3,200,000.00 Specification limit unreachable.
Total 18,105,000.00 13,685,000.00

Case Questions:

1. Do you agree with Ms. Gilda Ching, the President that the rate of five failed projects out
of ten is a bad record and is really alarming? Why?

Answer: Yes, Because the Company’s Reputation is on the line, and it is going to hit the
Company hard. New projects will be reduced, they need to cope the money wasted in
these failed projects and other negative outcomes.

2. Is it really dangerous for a project manager to recommend for termination a project in the
early phase of the project life cycle? Defend your answer.

Answer: No, Because the earlier the project manager recommends to terminate a project
in the early phase of the project life cycle, the more they save money from wasting, if the
certain project is going to be a failing one.
3. Who if there is anyone, should the failure be attributed in this case? Explain.

Answer: I think the one who is at fault is the Project Manager itself, even though they
breakdown this failure of the project (Exhibit 1 and 2). The project manager didn’t act as
the project manager, he didn’t spot what will be the outcome of the project sooner. The
moment they spotted it. The project is at failing state. That’s why the Project Manager is
the one who should be blamed.

4. Why do you think highly talented resources can over think a certain project to the point of
searching for complex solution rather than simple one? Give details.

Answer: Highly talented resources tend to think differently to the average one’s, then the
expected outcome should be more possible. But they overthink, then the cycle resets to
the point of no solution searched.

5. Do you think having majority of project managers being engineers have contribution to the
failure of some projects? Justify.

Yes, if the project manager being engineers work on an IT Project, there are terms that is
not synonymous to the engineering terms because it’s an IT Project which is the case.

No, if the project manager being engineers work on an Engineering Project. They are
familiar with the terms and that’s their forte.

6. Is a follow-on meeting necessary? Should all project managers have to attend?

Yes, they should attend. They have learned their lessons, and they should be prepared to
the future projects.