PMD 46

Effective Execution

Syndicate Assignment

Note: The is a fictional case study

Assume you are an external consultant project manager who is a partner in a professional
project management consultancy called Project Implementation Expert (PIE). The
consultancy specializes in offering multidisciplinary teams of professionals that provide
integrated design planning and implementation for the production of new products in small to
medium-sized enterprises. Companies develop ideas for innovative new products and then
commission PIE to analyse the design and production processes needed to produce the
product. PIE then develops comprehensive design and production facilities and manages the
development of these processes up to the point where full and tested production is achieved.

PIE has recently been commissioned by a small confectionery food manufacturer called
Sweetness Ltd. Sweetness Ltd. has an established track record in the production of ice
creams and other frozen sweet products for the local market. The overall market share of
Sweetness Ltd. Is rather small as it operates in a market that is dominated by two major
producers.
It is imperative that Sweetness Ltd. both consolidates and develops its product range in
order to maintain and, if possible, expand its limited customer base.

As part of a long-term innovation programme, Sweetness Ltd. wishes to introduce a new

frozen chocolate bar range. The new range is to be produced in the existing main production
plant.
There will be a need for a complete new production line, although parts of this new facility
will link in with existing equipment.

Sweetness Ltd. have appointed PIE as project managers for the entire process of designing,
installing and commissioning the new production line for the new range. Sweetness Ltd. has
stipulated that their existing production equipment installer, Treat Manufacturing Systems
Ltd., is to act as main contractor and is to install all new plant and machinery using a
combination of equipment manufactured by themselves and by a specialist food equipment
manufacturer called
Cooling and Chilling Solutions Ltd. Sweetness Ltd. has nominated Cooling and Chilling
Solutions Ltd. as nominated suppliers. Sweetness Ltd. has also nominated Central Cooling
Plant Ltd. as nominated sub-contractors for a range of specialist works. There are also a
number of domestic sub-contractors and suppliers that have been selected independently by
Treat Manufacturing Systems Ltd.

You have selected a number of specialist consultants to advice on the project. Specialist
process analysis is being carried out by a professional consultancy called Top Design. The
design of the actual production equipment is the responsibility of a specialist mechanical
engineering consultancy called Treat Production Systems. Risk analysis is the responsibility
of a specialist risk management consultancy called Risk Solutions.

Sweetness Ltd. has an internal control system that has an overall monitoring and control
responsibility. The cost of the project is monitored by an internal Change Control
Department, which is responsible for making sure the project falls within budget. The
Change Control Department receives monthly cost reports and has to be approached for
authorisation for any change requests valued at R100,000 or higher. Sweetness Ltd. also
has an internal Legal Services Department that is responsible for the issue and
implementation of all contracts with external bodies.
The Legal Services Department is also responsible for acting as an interface and all contract
instructions and other formal communications must be routed through it. Sweetness Ltd. has
also appointed an internal Project Interface Manager who is a member of the project team
and is responsible for ensuring the interests of the company are maintained at all times. The
company has also established a Strategic Programme Development Group that is
responsible for the overall strategic development of the various projects that are taking place
at any one time. The Legal Services Department, Change Control Department and the
Project Interface Manager all report to the Strategic Programme Development Group, which,
in turn, reports directly to the Sweetness Ltd. Board.

The new production facility has to be inspected and passed by the Local Authority
Consumption and Hygiene Inspectorate before it can be certificated and allowed into
production. The facility will also require a new mains electricity supply that is to be installed
by the local electricity supply company called Local Power PLC.

PIE is planning to expand its services in the field of energy and in the face of falling reserves
of traditional resources such as oil and gas, the Government in the country where PIE
operates is investigating alternative sources of energy production and has come to PIE for
advice. One project the government has just initiated is to explore the feasibility of using new
technologies that use wind power to generate energy. This would involve the construction of
a large scale wind farm which would consist of one hundred wind turbines which are big,
noisy and unattractive structures. If the project goes ahead, the location identified for the
wind farm is one of the country's most picturesque and beautiful national parks.

The next stage of the project is to assess the feasibility of the wind farm project.

Note: In developing your answers you can make any assumptions you wish provided these
are reasonable, do not contradict the content of the case study and are clearly written down.

Note: Company and individual names are shown in italics.

Question 1
Making any reasonable assumptions, design a suitable organisational breakdown structure
(OBS) for the project showing all communication, authority and contractual links and discuss the
rationale behind your recommended arrangement of contracts. (14 marks)

Question 2
From the point of view of Sweetness Ltd., discuss the likely project risks associated with the
organisational structure as described and suggest appropriate risk responses. (At least six risk must
be identified) (12 marks)

Question 3
Differentiate between conditions of certainty, conditions of risk and conditions of uncertainty giving
examples from the case study of each type at both the project and strategic levels.
(12 marks)

Question 4
The government has come to PIE to help them clarify some uncertainties. You have been
asked to explain the purpose of project feasibility, making reference to the different types of
feasibility studies that should be undertaken for the wind farm project specifically.
(NB you facts must be related to this project) (12 marks)