A Manager’s Toolkit: Communicating Change During Mergers and Acquisitions


Introduction

It is an understatement and an underlying truth that organizational changes have “serious impacts on the organizations and their employees” (Appelbaum, Lefrancois, Tonna & Shapira, 2007, p.191). Mergers and acquisitions exemplify perhaps the worst kind of change in any employee’s mind (Petersen, 2009).

It needs to be understood that managers, by definition, are responsible for an employee’s adaptability (Caproni, 2005, pp. 223-224; Petersen, 2009).

Even early rumors and hints of mergers or acquisitions foretell a time of instability, uncertainty, stress, and change in the workplace. Such passages touch on the lives of an entire workforce, from the most recent entry-level employee to veteran senior managers (Petersen, 2009). From the first announcement and well into the future of any newly merged operations, the responsibility of a manager will also change. Each person will have to adapt.

                Employees may view downsizing during a time of economic turmoil as a manmade disaster. “The resulting disruptions have rippled across supply chains, shaken entire industries and taken their toll on employee, customer and partner relations” (The Human Side of Business Continuity Planning, n.d.). Thus, it is crucial that a manager be prepared to intelligently present the changes, be sensitive to the impending personal adjustments required, and be aware of the many human capital risks that could impede desired corporate results.

The interior circle in Figure 1 points to three troublesome corporate challenges that could grow out of human capital risks:

Figure 1: The Human Side of Business Continuity Planning (www.continuitycentral.com retrieved February 13, 2009)

Managers can limit or eliminate any negative side effects through effective communication. “People want purpose and meaning in their day-to-day work lives” and this focus may be skewed during mergers and acquisitions (Caproni, 2005, p.221).

Uncertainty can be reduced by meeting with the workforce often during the change, providing answers to questions. This will help in “motivating and retaining key staff in the event” (Kummer, 2008, p.5). Reassuring high-performers of the value they provide will also maintain motivation levels.  People will naturally arrive at conclusions themselves, but will be satisfied that their questions have been answered.

In this toolkit, you will learn guidelines for effective communication, guidelines for active listening, suggestions for delivering bad news to employees, guidelines for dealing with emotional employees and suggestions for self-motivation and healing.

Guidelines for Effective Communication

“There is no such thing as too much communication when dealing with employees, especially when the timeline is short and they are required to make decisions affecting their careers with very little notice” (Charland, 2008, p.11). The workforce needs “a sense of predictability and control” with a clear mission, consistency, high involvement, and adaptability (Caproni, 2005, p. 221). During mergers and acquisitions, a person’s culture or “people issues” remain one of the most difficult tasks to accomplish successfully” (Kummer, 2008, p.5). “People bring their culture to an organization,” making adaptability a vital organizational survival skill (Fisher, 1999, p. 12). This can be done by following these effective communication guidelines (Szpekman, 2004, p.9):

  • Talk less and listen more,
  • Tell the workforce everything,
  • Ensure messages are “clear, simple statements,”
  • Reduce uncertainty instilling a new sense of control,
  • “Let people arrive at conclusions themselves,”
  •  “Reassure high-performing employees of their value,”
  • “Measure performance outcomes and monitor employee reaction” and allow senior management to be visible.

If you are dealing with difficult issues such as down-sizing be sure to communicate “squarely and candidly” (Roach, 2007, p.8). Always tell the workforce everything with clear and simple language. Communications should be unambiguous, dealing with “quantifiable facts openly” and achieved by confronting reality, setting objectives, and simply being there for the employees at this time when they need managers most (Valant, 2008, p.15).

Continue to measure performance outcomes and monitor employee reactions to keep you in touch with the reality of the workforce impact and allow you to change your communication strategy if needed. Most importantly, being visible during this stressful time will show that you have empathy and that you support the people. The uncertainty and stress during a merger and acquisition can be reduced so “employees have faith in the success of the transition” (Charland, 2008, p.11).

Guidelines for Active Listening

During the merger and acquisition process, managers need to allow employees to express concerns about their future. Managers should be able to listen to current employees and address these concerns.

Employees, regardless whether they stay or leave, will suffer less and hold the company in higher esteem if employees are treated with compassion and respect. A good start is to look people in the eye, answer their questions, listen to their concerns, and warmly thank the people for sharing these concerns (Fryer, 2009).

The following are guidelines and suggestions for active listening as a manager (Caproni, 2005, pp. 117-118):

  • Learn to listen with intensity and give the person speaking your full attention.
  • Don’t get distracted. Turn off your cell phone and ignore the computer screen in front of you;
  • Don’t assume that the issue is uninteresting or unimportant;
  • Don’t listen only for what you want to hear;
  • Don’t think ahead to what you plan to say next;
  • Don’t interrupt, talk too much, or finish people’s sentences for them;
  • Don’t engage in fake listening techniques such as nodding your head;
  • And, don’t let the person’s status, appearance, or speaking style distract you.

Also, learn to listen with empathy. Understand, or attempt to understand, the message from the speaker’s point of view. Don’t relate everything you hear to your experience and pay attention to body language providing clues to the speaker’s concerns and emotional state.

Demonstrate acceptance and show that you are listening with an open mind. Avoid killer phrases such as “You have got to be kidding, that will never work,” and “Yes, but…” Also, avoid judgmental body language. Condescending grins and rolling one’s eyes can have the same effect as killer phrases.

Additionally, take responsibility for completeness and encourage the speaker, whether it is your manager or your employee, to give complete information. And, be yourself. Be sincere and do not come across as compulsive artificial, or overly trained as an active listener (Robbins & Hunsaker, 1989).

Most importantly, be aware of cultural diversity issues if you have visible minority subordinates. Identify the culture traits of your employees and adjust your communication style and listening style accordingly.

Guidelines for Delivering Negative Information to Employees

Informing an employee the organizational culture is changing, their job is changing, or they may be losing a job because of a merger or acquisition is challenging. In this section, consider suggestions how to deliver the “bad news.” Remain supportive of the corporate strategy; how you can maintain business operations; and how you can deliver critical information in the process. The following describes guidelines for delivering negative information prior to, during, and after a merger or acquisition.

            First, be aware of what you can communicate based on legal constraints (IABC.COM). If your company involves both employees and consumers, recognize that the communication with employees will have an impact on the consumer. Downward communication is what your focus, as a manager, will be (Timm & Peterson, 2000, p. 128). Then, as suggested in the previous section, be prepared to listen as a vital part of upward communication (Timm & Peterson, 2000, p. 128). The sooner you have clearance to communicate, the more efficient the implementation will be. By nature, people tend to resist change and they see threats in the unknown (Timm & Peterson, 2000, p. 132). Make every effort to be able to explain if the merger and acquisition is makes sense from a strategic, financial, human resource, and individual employee perspective.

            Once it is absolutely necessary to change the structure of the organization, follow these suggested guidelines (Bossidy & Charan, 2004; Caproni, 2005; IABC.COM; Timm & Peterson, 2000; and Petersen, 2009):

  • Make sure you understand and embrace the reasons for the change. You are likely to be asked.
  • Know what you can and cannot say.
  • It may be appropriate to have a representative from Human Resources with you, both to witness and field related questions.
  • Directly and succinctly present what exactly will happen.
  • Explain to the employee that the company, or the division within the company, simply has to “confront reality.”
  • Approach employees by sharing your own feelings. Suggested wording includes, “I, as you, thought we would be on solid ground, but I did not account for the possibility of what is now clear.” You may also say, “I have had to digest it, how it affects you, how it can affect our supervisors, and me.”
  • Ensure employees have a chance to be part of the change management team if the bad news you are delivering is not that they will be losing their job. Explain that their job function might be changed.
  • Recognize the employees’ achievements and acknowledge their success. Reassure them they can continue their achievement toward a “new success” under the guidelines and values of the new company.
  • Open the opportunity for question and be honest, while not answering questions you cannot answer. Promise to inquire and tell the employee you will return with information when you have it, and then actually do it.
  • Ask the employees for suggestions on how they think the company can adjust under the new circumstances.
  • Give the employee time to digest the information, but thank them for their initial response.
  • Tell them that you are available to address their concerns, and keep it that way.

Remain aware of the trade-offs that come from productivity once organizational change is made. It is possible that the employee who is laid-off could initially react positively but return with negative emotions the following day (Caproni, 2005, pp. 121-122).  “Voice your understanding how difficult, even sad, this is for them and for their families” (Petersen, 2009). If necessary, have a crisis team available to answer any questions or offer emotional support (The human side, n.d.).

Knowing How to Deal with Emotional Employees

Today’s economic condition has made the job environment even more stressful than usual. On a scale of life events, those associated with job loss or change in work environment rate in the top ten (Swan, 2008). This influx of change in the workplace will significantly increase emotional stress on an employee, which a manager needs to be prepared to manage effectively.

Managers dealing with employees need to deal with emotional issues in addition to daily work activities. The manager who possesses developed emotional intelligence will be able to cope with the merger and the emotional reactions coming from employees like anxiety, uncertainty, conflicts and the challenge to continue to motivate (Caproni, 2005).  In order to manage a group of employees faced with the prospect of a merger, there are some core principles to keep in mind to achieve success. These principles include (Stockdale, 2006):

  • Be in constant, honest communication with employees.
  • Provide resources for those who will be displaced or have significant changes to their job duties. It is critical to show employees that you, as their manager, have their interests in mind during the merger.
  • Give assurances about change to the employee’s role in the organization. Ensure that the employee will still play a part in the department and its achieving set goals.
  • Employ active listening techniques to hear employees. Work to take discernable action to address their concerns.

These key concepts will work to reassure employees while also providing a level of stability from their direct manager.  A manager must be prepared for the employee emotions to run the spectrum from being scared to confused to angry (Stockdale, 2006).  From an employee point of view, the sudden change brought about by a merger will call into question their role in company as well as the reciprocal loyalty element between employee and employer.  There is a strong emotional attachment to a company’s culture and the employee expects some level of reciprocation of this relationship through a stable work environment and a semblance of loyalty (Siegal et al, 2006).  Once this relationship is changed or perceived as broken by the employee, a manager needs to step in and act as an arbitrator to keep the employee-company relationship stable. It is at this moment the manager needs to remember the core principles mentioned heretofore in order to provide the needed reassurances to the employee to keep them focused on performing their job.

Guidelines for Managerial Motivation and Healing

Within a merger or acquisition a manager may come across conflict within his or herself. Their ability to lead a team during transition is key. Both before and during the transition it is important for a manager to spend time on self-reflection and analyzing their own role and performance (Tracy, 2009). Managers need to find ways to educate themselves (Zatz, 2009).

The foundation for a manager’s ability to self-coach should be rooted in the following principles (Tracy, 2009):

  • Use upward feedback. Create an open channel for your subordinates to give both anonymous and specific feedback.
  • Acquire self-coaching skills by incorporating a written exercise to visually see daily activities and the outcomes of each. For example (Tracy, 2009):
  • Outline your goals and future plans ahead of time.
  • Log daily activities and the outcomes you intent.
  • Review the outcomes and the reasons for each.
  • Critique yourself and analyze what changes could have been made to create a more effective solution.
  • Seek advice from your direct subordinates as well as your own direct supervisors.
    • Also, learn to delegate tasks to other employees. Delegating tasks can promote trust within your department (Caproni, 2005).
    • Obtain education. Seek out courses that can help enhance your experience. Or, team with other managers who have experienced a merger in the past. Consult your network to educate yourself on their strengths and weaknesses.
    • Analyze yourself. Have the ability to step back and examine your own abilities. Spend time each day reviewing your positive and negative traits.

The ability to deal with the rapid changes of a merger can greatly depend on the ability for self-evaluation. In order to effectively coach others, you must be able to educate yourself. A manager’s role within the company can change just as much as that of an employee. The ability to adapt is key to a successful transition. The adaptation comes when a manager can analyze their own performance and promote communication as an opportunity to further the newly acquired skills.

Conclusion

Follow these guidelines to communicating change and your organization is sure to maintain the support and loyalty from the people who are the powerhouse to the organization’s success during a merger or acquisition. A merger represents a significant organizational change that makes many employees react in an emotional manner.  Managers need to recognize the unique issues during this time and work to stabilize the environment and employee emotions.  Following these guidelines will build organizational credibility from management to the employees and keep the performance of the impacted employees at the same, or a better level prior to the merger or acquisition.

References

Applebaum, S., Lefrancois, F., Tonna, R., and Shapiro, B. (2007) Mergers 101 (part two):       Training managers for culture, stress, and change challenges. [Electronic Version]         ABI/INFORM. Industrial and Commercial Training. Guilsborough. Vol. 39. 4., p. 191

Bossidy, L. & Charan, R. (2004) Confronting Reality: Doing What Matters to Get Things            Right. Crown Business [From Notes Taken February 2009]

Caproni, P. (2005) Management Skills for Everyday Life: The Practical Coach (2nd Edition).        Upper Saddle River, NJ: Pearson/Prentice Hall

Charland, M. Brent. (2008) Innovapost executes on high-speed merger and acquisition   activities. [Electronic Version.] ABI/INFORM Strategic HR Review. Chicago. Vol. 7. 6.,             p. 11

Fisher, J. R. Jr. (1999) Merging Cultures. [Electronic Version.] ABI/INFORM. Executive           Excellence. Provo. Vol 16, 4., p. 12

Fryer, B. (2009) The Layoff: What’s the Best Strategy for Astrigio. HBR Case Study and           Commentary. Harvard Business Review, pp. 2-7

IABC.COM (2009) Communication’s Role in the Merger Process. Retrieved November 2009      from: IABC.COM

Kummer, C. (2008) Motivation and retention of key people in mergers and acquisitions. [Electronic Version]. ABI/INFORM. Strategic HR Review. Chicago, Vol. 7, 6., p. 5

Michelman, P. (2005) Methodology: An Outsourcing Checklist. Harvard Business School             Publishing Corporation.

Petersen, R. (November 26, 2009) Personal Communication with former Newspaper Editor with             Managerial Experience on Management and Communicating Change During Mergers   and Acquisitions. Escondido, CA.

Roach, C. (2007) Taking the Lead During a Merger. [Electronic Version] ABI/INFORM.            Strategic Communication Management. Chicago. Vol. 11, 1., p. 8

Robbins, S. and Hunsaker, P. (1989) Training in Interpersonal Skills: Tips for Managing            People at Work. Upper Saddle River, NJ: Prentice Hall

Siegal, D. and Simmons, K. (2006) Assessing the Effects of Mergers and Acquisitions on Firm      Performance, Plant Productivity, and Workers: New Evidence from Matched Employer-   Employee Data. Renssealaer Polytechnic Institute. Troy, NY.

Stockdale, D. (2007) Helping Employees through a Merger or Acquisition. Retrieved on   November 23, 2009 from: http://www.myarticlearchive.com/articles/6/042.htm

Stone, D., Patton, B., & Heen, S. (1999) Difficult Conversations: How to Discuss What Matters   Most. New York, NY: Penguin Books

Swan, P. (2008) The Top Six Stressor Areas in Life: How to Recognize and Handle the Stress.       Retrieved on November 25, 2009 from:      http://www.sixwise.com/newsletters/05/05/17/the-top-six-stressor-areas-in-life-how-to-            recognize–amp-handle-the-stress.htm.

Szpekman, A. (2004) Guiding Principles During a Merger. [Electronic Version]. ABI/INFORM.             Strategic Communication Management. Chicago. Vol. 8, 4., p. 9

The Human Side of Business Continuity Planning. (n.d.) Continuity Central. Retrieved            February 13, 2009 from www.continuitycentral.com

Timm, P. and Peterson, B. (2000) People at Work: Human Behavior in Organizations. (5th          Edition). Cincinnati, OH: South-Western College Publishing

Tracey, B.J. (2009) Helping Managers Help Themselves. Cornell Hospitality Quarterly. Cornell   University

Valant, L. (2008) Why Do Both Marriages and Business Mergers Have a 50% Failure Rate?        [Electronic Version.] ABI/INFORM. The CPA Journal. New York. Vol. 78, 8., p. 15

Zatz, D. (2009) An HR Manager’s Guide to Mergers and Acquisitions. Toolpack Information.     Retrieved November 27, 2009 from: from www.toolpack.info/how-to/hr-managers-   guide-to-mergers.html

Eric Tse, Richmond Hill, Toronto
Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting
http://tsetseconsulting.webs.com/index.html
https://tsetseconsulting.wordpress.com/
http://erictse2.blogspot.com/

tsetseconsulting

 

 

 

 

Virtual Team Policy for Siemens AG

MET AD646 Group 06, Team C:

Cassandra Ramirez

Marnie Spadaro-Wilkins
Khang Ta
Hiu Fung Tse

Program Management and Planning AD 646

Professor Dorothy Tiffany

April 5, 2009

Assignment 4.3

 

 

 

 

 

 

Project Management Policy

In general, please write your section from the perspective of a Siemens employee and not a member of our team. Please limit your writing to one page since the overall assignment length is only 3 pages. In addition, please provide external references to augment the policy statements. You should include all appropriate tables and checklists in the appendices. Please consult with your back-up if you have any questions. Remember that we need to answer the questions posed in the syllabus in your writing:

  •  What are the unique challenges of managing a virtual project team?
  • How will you build the virtual team to…

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NBT system NASA

The NBT Case Study assigned for this class (and attached below) was developed to demonstrate the important concepts raised not only in this week’s materials, but also the materials from your previous project management courses. In responding to the questions below, think creatively about the key problems in the NBT system and how you would resolve them.

Key problems Actions
Congress had recently become aware of the large un-costed carryover and had requested that the NOAA IG audit the project’s finances to determine if appropriated funds were being used as directed.Congress cut NOAA’s budget request by the same amount and directed NASA and NOAA to use the old funds for the coming year.The process to move the funds into accounts that could be used in the NASA accounting system was   long and difficult, Sarah knew that her staff must start working on this process right away. She also knew that she would have to examine all of the other business operations to determine if there were any other systemic problems.
the spacecraft contractor, Acme Space Company, seldom needed to consult schedules and drawings as they completed the hardware. In fact, they didn’t worry about updating the detailed schedules and drawings.The contractor’s master schedule did not always reflect the true status of the project and seldom had the same dates as the production schedules.NASA managers were aware of this practice and concurred with the need to keep the work moving. They compensated for the disconnect by making adjustments to Acme Space Company’s schedules when they reported the project status to NOAA. We need to fix the process and enforcement so that the contractor would consult and update schedules and drawings. Make sure the master schedule reflect true status so that NASA managers don’t have to make too many adjustments of the schedules and project status.
NBT Deputy Project Manager, Sam, was proud of his ability to convince Acme Space Company to accept engineering changes without formal contractual direction. Contractor does the additional work at no cost to the government.Acme Space Company’s, was growing increasingly nervous, building up a large backlog of proposals with no contractual documentation from the contracting officer. Some of the changes might also impact the completion schedule of the contract. Compile a list of the outstanding changes. Force all the changes gone through the change management control processes. Including tracking, evaluating, analysis const, prioritizing, etc.
Most of the variance analysis reports stated that no meaningful analysis was possible because the plan didn’t reflect the work actually being done.Acme Space Company would not reflect proposed changes in the performance measurement baseline until they were negotiated. In this way, he could ensure that his baseline was never above the contract value.Sam was sensitive to contractors re-planning their work all the time, so he didn’t allow them to do so unless he concurred.

Sarah noted that the monthly earned value and actual cost had negative values in some cases

It had been several years since a comprehensive look at the estimate at completion had been performed.

Enforce the process that variance analysis report reflects the real situation.And let the problems appear on the report and try to think about how to fix all those problems, including schedule and cost overrun.
Sam’s direction had changed some of the standard earned value rules and terminology.the Earned Value Management System (EVMS) data for NBT was inconsistent with the rest of the Princeton facility’s system.did not match the Performance Measurement Baseline (PMB) staffing plan, nor did the actual staffing levels match those of the earned value reports.

Time collection system was manual and that many people submitted their timecards late.

 

Implement computerized system and make it fits the standards.Make sure the people can get used to the new   system and put their electronic time sheets on time.
impending closure of the Princeton plant due to the consolidation of defense contractor facilities.Acme Space Company would move four satellites in various stages of production to Los Altos, California, along with about 20 of the senior engineering managers.Everyone else (250 people) in the Princeton facility would be given early retirement or lay-off slips within the next year.

transition plan was needed to ensure data integrity and continuity

Accounting and earned value systems were not the same as those used in Princeton, so a transition plan was needed to ensure data integrity and continuity during and after the move.

Key players

Sam Deputy Project Manager
Sarah PM
IG (Inspector General) Congress Auditor
Henry Mabie Old PM
NOAA customer
NASA/NBT Organization carry ou tprojects
Acme Space Company Spacecraft contractor
Willis Acme Space Company project manager

1. In the NBT case, how realistic is the budget request that was given to NOAA prior to Sarah’s arrival on the project?

The project had started many years before Sarah became the DPM/R and had enjoyed a healthy budget. In fact, the budget was so fat that the project had accumulated over a year’s worth of uncosted residual funds from the nine previous fiscal years. It was not realistic.

That’s why the congress send inspector general to audit the project and make a decision that the budget is cut and make them use up all the old reserve before they can use the new ones.

2. Of all the problems faced, which problem has the potential for causing the largest overrun for the project?

I feel the closure of the Princeton plant would cause the largest overrun of the project. Since most people who know the technical stuff would get kicked out, except the senior managers. The knowledge would be lost and no one can pick up the project quick and be productive on what they have been doing.

Moreover, the style they have been using is no good documentation, no good drawings, no artifacts. Once the people are gone, no one would know what’s have been done. The whole program would fail if the transition plans were not done very carefully. Also make the people to redraw and re-document everything from the beginning again would be a hard job, especially if they know they would be kicked out later.

3. How could a well organized Project Management Office have avoided the problem described in question 2? Explain how you would have structured you PMO to avoid this problem.

Allocate enough budget and resource for projects for the transition plan.

1)     One project is to force the people to generate all the artifacts, drawing, documentation back from the beginning.

2)     Another project is a knowledge transfer project, let the contractor train the NASA or NOAA people about the technical details of the whole program, also the infrastructure of the program. Set up buffer period that new people can do start owning jobs while old people can support them.

3)     Change and enforce the process so that the ACME space aircraft would generate artifacts while they develop things or make changes. Enforce strict tracking and monitoring, so that NASA can have more control of what they are doing.

Submit the completed document using the Attachments tool on this page. Please be sure to include your own name in the filename, last name first then first initial (for example: doej_assignX.doc) and in the text of the document, so your instructor/facilitator always knows whose submission he/she is reading.

Need Help?

  • For clarification regarding the assignment details, contact your instructor.
  • For help uploading files, go to the Technical Support page in the Syllabus.

Eric Tse, Richmond Hill, Toronto

Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting 

http://tsetseconsulting.webs.com/index.html

https://tsetseconsulting.wordpress.com/

http://erictse2.blogspot.com/

Virtual Team Policy for Siemens AG

 

 

 

 

Virtual Team Policy for Siemens AG

MET AD646 Group 06, Team C:

Cassandra Ramirez

Marnie Spadaro-Wilkins
Khang Ta
Hiu Fung Tse

Program Management and Planning AD 646

Professor Dorothy Tiffany

April 5, 2009

Assignment 4.3

 

 

 

 

 

 

Project Management Policy

In general, please write your section from the perspective of a Siemens employee and not a member of our team. Please limit your writing to one page since the overall assignment length is only 3 pages. In addition, please provide external references to augment the policy statements. You should include all appropriate tables and checklists in the appendices. Please consult with your back-up if you have any questions. Remember that we need to answer the questions posed in the syllabus in your writing:

  •  What are the unique challenges of managing a virtual project team?
  • How will you build the virtual team to maximize business opportunities and minimize risk?
    • What tools does a project manager need to avoid some of the pitfalls of virtual teams?
    • How will you distinguish the business culture from the country culture in developing your policy?

 

Conflict Management and Resolution Policy

Please refer to the sample conflict management policy from the syllabus for ideas and format also.

 

Policy for Applications of Project Management Tools and Techniques

Problem of Siemens

From the case studies, we can identify some problems that can be solved by virtual PM techniques: [1005]

 

–          Lack of direction on how much guidance from Siemens on how things should be done.

–          Indian Folks focus on doing the real work instead of documentation

–          Hard for Siemens center to track and communicate to Indian center quality, hence the quality of the product is below Siemens Standard.

–          The time zone difference makes them hard to communicate and collaborate.

–          Span of management too Large, Re-organize development center into smaller technical units with fewer people reporting to next level

–          Lack of coordination (Intra Bangalore and others) in interdependent projects

 

Policies: PM tools

 

  1. For synchronous communication between Indian andGermany, Siemens should use Webex and telephone to carry out synchronous communication. Webex [1] can allow participants to look at the host desktops, so that presenters can have a very high flexibility to present their work or solve problems together through sharing their desktop. They need also Audio conferencing on telephone because you can talk to the person you are working with. You can also record your sharing session for future reference.
  2. Instant Policy Text messaging: You can use instant messenger technology, such as msn messengers[2], Skype [3], yahoo messenger[4], AOL[5].  Of course Siemens can utilize some corporate instant messenger. The basic mode is text messaging, also you can have instant audio and video conferencing solution with the tools.
  3. Siemens employees need  asynchronous, common area to post work, progress, idea. Siemens employees have their platform to collaborate, exchange ideas, mega-communicate[12], while Project managers can track/monitoring employee’s work more easily even they stay far away from each other. They use document repository software (such as Documentum[6]), and knowledge database and (Domino Servers [7] Lotus software Database [8]).
  4. And Siemen will carry out system integration project for Staff Timing, expense project management for project management control and monitoring with Lotus software, DB2[9], and Websphere[10] to achieve certain technology like what STEPS project did (Staffing Time and Expense Project management System) [11]


Policy on Cultural Interactions

 

 

 

 

 

References

Duarte, D. and Snyder, N. (2006). Mastering virtual teams. (3rd ed.).San Francisco: Jossey-Bass.

 

Gray, Clifford & Larson, Erik. (2008). Project management: The managerial process. (4th ed.).New York: McGraw-Hill/Irwin.

[1005] Thomke, S. (2002). Siemens AG: Global Development Strategy.HarvardBusinessSchoolPublishing

[1] Cisco Webex,(2009),WebEx: Web Conferencing, Web Meeting, Video conference, http://www.webex.com

[2] MSN messenger, (2009), MSN Messenger, webmessenger.msn.com

[3] Skype, (2009), Skype Official website – download Skype free now, http://www.skype.com

[4] yahoo messenger, (2009), Chat, Instant message, SMS, PC calls, ca.messenger.yahoo.com

[5] AOL Instant Messenger, (2009), official site of AOL instant messenger, http://www.aim.com

[6] Documentum, (2009), EMC Documentum – Enterprise Content Management http://www.documentum.com

[7] Domino Servers, (2009), IBM Domino Servers, www-01.ibm.com/software/lotus/notesanddomino

[8] Lotus Notes, (2009), IBM Lotus Notes, www-01.ibm.com/software/lotus/notesanddomino/

[9] DB2, (2009), DB2 Product Family, www-01.ibm.com/software/data/db2/

[10] Webshpere, (2009), Websphere software, www-01.ibm.com/software/websphere/

 

 

 

 

Appendices

Tables

 

Table 1: Project Management Policy and Team Structure   

Table 1 Sample: Team-Type Attributes

 

Team Type

Attributes

Networked Teams

A Networked virtual team consists of individuals who collaborate to achieve a common goal or purpose.

Parallel Teams

Parallel virtual teams carry out special assignments, tasks, or functions that the regular organization does not want to or is not equipped to perform

Project or Product Development Team

Team members of this team conduct projects for users or customers for a defined but extended period of time.

Work, functional or Production Team

This team performs regular and ongoing work.

Service Teams

This team is a support or an “on-call” team for technical difficulties

Management Team

This team involves upper management of the organization.

Action Teams

This team is designated to offer immediate response, often to emergency situation.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Virtual Team Policy for Siemens AG

MET AD646 Group 06, Team C:

Cassandra Ramirez

Marnie Spadaro-Wilkins
Khang Ta
Hiu Fung Tse

Program Management and Planning AD 646

Professor Dorothy Tiffany

April 5, 2009

Assignment 4.3

 

 

 

 

 

 

Project Management Policy

In general, please write your section from the perspective of a Siemens employee and not a member of our team. Please limit your writing to one page since the overall assignment length is only 3 pages. In addition, please provide external references to augment the policy statements. You should include all appropriate tables and checklists in the appendices. Please consult with your back-up if you have any questions. Remember that we need to answer the questions posed in the syllabus in your writing:

  •  What are the unique challenges of managing a virtual project team?
  • How will you build the virtual team to maximize business opportunities and minimize risk?
    • What tools does a project manager need to avoid some of the pitfalls of virtual teams?
    • How will you distinguish the business culture from the country culture in developing your policy?

 

Conflict Management and Resolution Policy

Please refer to the sample conflict management policy from the syllabus for ideas and format also.

 

Policy for Applications of Project Management Tools and Techniques

Problem of Siemens

From the case studies, we can identify some problems that can be solved by virtual PM techniques: [1005]

 

–          Lack of direction on how much guidance from Siemens on how things should be done.

–          Indian Folks focus on doing the real work instead of documentation

–          Hard for Siemens center to track and communicate to Indian center quality, hence the quality of the product is below Siemens Standard.

–          The time zone difference makes them hard to communicate and collaborate.

–          Span of management too Large, Re-organize development center into smaller technical units with fewer people reporting to next level

–          Lack of coordination (Intra Bangalore and others) in interdependent projects

 

Policies: PM tools

 

  1. For synchronous communication between Indian andGermany, Siemens should use Webex and telephone to carry out synchronous communication. Webex [1] can allow participants to look at the host desktops, so that presenters can have a very high flexibility to present their work or solve problems together through sharing their desktop. They need also Audio conferencing on telephone because you can talk to the person you are working with. You can also record your sharing session for future reference.
  2. Instant Policy Text messaging: You can use instant messenger technology, such as msn messengers[2], Skype [3], yahoo messenger[4], AOL[5].  Of course Siemens can utilize some corporate instant messenger. The basic mode is text messaging, also you can have instant audio and video conferencing solution with the tools.
  3. Siemens employees need  asynchronous, common area to post work, progress, idea. Siemens employees have their platform to collaborate, exchange ideas, mega-communicate[12], while Project managers can track/monitoring employee’s work more easily even they stay far away from each other. They use document repository software (such as Documentum[6]), and knowledge database and (Domino Servers [7] Lotus software Database [8]).
  4. And Siemen will carry out system integration project for Staff Timing, expense project management for project management control and monitoring with Lotus software, DB2[9], and Websphere[10] to achieve certain technology like what STEPS project did (Staffing Time and Expense Project management System) [11]


Policy on Cultural Interactions

 

 

 

 

 

References

Duarte, D. and Snyder, N. (2006). Mastering virtual teams. (3rd ed.).San Francisco: Jossey-Bass.

 

Gray, Clifford & Larson, Erik. (2008). Project management: The managerial process. (4th ed.).New York: McGraw-Hill/Irwin.

[1005] Thomke, S. (2002). Siemens AG: Global Development Strategy.HarvardBusinessSchoolPublishing

[1] Cisco Webex,(2009),WebEx: Web Conferencing, Web Meeting, Video conference, http://www.webex.com

[2] MSN messenger, (2009), MSN Messenger, webmessenger.msn.com

[3] Skype, (2009), Skype Official website – download Skype free now, http://www.skype.com

[4] yahoo messenger, (2009), Chat, Instant message, SMS, PC calls, ca.messenger.yahoo.com

[5] AOL Instant Messenger, (2009), official site of AOL instant messenger, http://www.aim.com

[6] Documentum, (2009), EMC Documentum – Enterprise Content Management http://www.documentum.com

[7] Domino Servers, (2009), IBM Domino Servers, www-01.ibm.com/software/lotus/notesanddomino

[8] Lotus Notes, (2009), IBM Lotus Notes, www-01.ibm.com/software/lotus/notesanddomino/

[9] DB2, (2009), DB2 Product Family, www-01.ibm.com/software/data/db2/

[10] Webshpere, (2009), Websphere software, www-01.ibm.com/software/websphere/

 

 

 

 

Appendices

Tables

 

Table 1: Project Management Policy and Team Structure   

Table 1 Sample: Team-Type Attributes

 

Team Type

Attributes

Networked Teams

A Networked virtual team consists of individuals who collaborate to achieve a common goal or purpose.

Parallel Teams

Parallel virtual teams carry out special assignments, tasks, or functions that the regular organization does not want to or is not equipped to perform

Project or Product Development Team

Team members of this team conduct projects for users or customers for a defined but extended period of time.

Work, functional or Production Team

This team performs regular and ongoing work.

Service Teams

This team is a support or an “on-call” team for technical difficulties

Management Team

This team involves upper management of the organization.

Action Teams

This team is designated to offer immediate response, often to emergency situation.

 

 

Eric Tse, Richmond Hill, Toronto
Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting
http://tsetseconsulting.webs.com/index.html
https://tsetseconsulting.wordpress.com/
http://erictse2.blogspot.com/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dabhol Power Project

After reviewing the assigned case studies and articles you should have an understanding of some of the key factors that cause projects to lose value and in some instances to fail. Utilizing this background and your outside research respond to the questions below.

1. Identify the various stakeholders in the Dabhol Power Project Case Study and the issues most important to these stakeholders. Where interests diverge, describe how these interests can be reconciled.

Stakeholder interests Conflict/reconciliation of interests
Congress Party-led national government Liberalisation of commerce/electricity/licensing, encourage foreign management,

Initiate Dabhol power plant, help ease SEB power supply, less corruption, flagship initiative marking the opening ofIndia’s domestic energy sector to foreign interests [1]

 

 

Suspect get bribed by Enron to speed up the process, and make the project happen regardless of the feasibility objections from authority
MaharashtraStateElectricity Board (MSEB), Local power generation sector

Enough power generation, cheap power generation.

Loss money, corruption and bribing. No money for building new plants. [2]

Cannot get their  electricity payment back. (corruption from industrial users??)

 

MoU signed, not agree program split in two phases

Don’t ask people for payment if people bribe

Enron Ambitious US power company

CEO had high profile[3] visions. He wanted Enron to be largest distributor of liquefied natural gas inIndia. [4]

 

Enron, with its aggressive

lobbying efforts, overcame the notoriously conservative Indian bureaucracy with exceptional speed to allow Dabhol to proceed[9].

 

After the halt of the Dahol project, Enron sue the Indian central and state governments for claim of compensation.

 

2001. Enron get bankrupted because it is corrupted as well.

 

 

 

MoU signed, but later split program two phases, violate interests of MSEB
World Bank Potential sponsor and funding provider[5]

State Dahol project not feasible early in the project.[6][7]

 

 
Central Electricity Authority (CEA) Federal authority for power sector

State that the Mou is one sided to Enron (electricity generation is too high)

Can Enron charge less?

 

MaharashtraStategovernment Regardless of objection of project feasibility of CEA[8] and World bank, still push the government to clear the project. (They get bribed???) Get bribed to make wrong judgement?
Nationalist BJP Party

Hindu nationalist Shiv Sena

Replace the Congress state government before the commencement of the Phase I of the project

They have an anti-Dahol perspective, believe dealings with foreigners are always bad.

 

Enron spent US$20 million to bribe the new party to let the project pass. [10]

The BJP ignored what they have promised during the campaign, to dump Enron into theArbianSea, and they revise the agreement more favour to Enron.

40 lenders, financing Phase two of the projects Concern about MSEB payment problems. They cannot get return of investment since MSEB is not getting payment because of corruption Cease further funding and investment.

 

Godbole Committe 1999 – bit BJP and get the ruling power by opposing Dahol Breakdown agreement, fight for the people.

 

DPC – Dahol Power Company Project executor, partnersjip of MSEB and Enron

1999 Cash Crisis,

2000 MSEB can’t afford the high cost, sold sahres to Enron

2001 stopped Phase I operations May, constructions of phase 2  halt in June

2001-2004 Left Idle

2004 Bachtel and GE acquired the Stake of DPC from American bankruptcy court

Waiting settle agreements

 

2006 reopen the the Power plant

MSEB accused DPC of misrepresenting Dahol’s technical capability and made a claim for compensation. (They know it is not feasibility, but they got bribed, not they claim money back)

Dispute payment of state, central government and the MSEB.

 

Bechtel and GE acquired Enron.s 65% stake in DPC for US$23 million through an American

bankruptcy court and initiated arbitrations to make good their losses.

United ProgressiveAlliance Tool over central government at 2004,

Main aim to clear foreign debts

settle the case between Dahol and Indian government. Bechtel get $160 million, GE get 145 million.

Overseas lenders get some money back.

 

Try to settle the dispute by paying the foreign investor some money back to minimize the lost of impact

 

2. Based on your readings and outside research, discuss the typical reasons why projects fail and how they might be addressed by early planning.

Problems Root causes projects fail and how they might be addressed by early planning.
Ignore feasibility studies, at the stages of financing,

The world bank has already indicated the project is not feasible. (such as the electricity is too expensive) [11]. Somehow the program management organizations ignore this. And at the1st phase of the project the prediction is correct.

Improper planning, Ignore feasibility studies of expert who has the knowledge.

Lack of understanding of the local situations.

If the project is identified as not feasible, they shouldn’t get started. [13]

 

Enron is too aggressive to bribe everyone to make it happen.

 

They should work out better alternatives to start and should balance interests on both sides.

Underestimate the complex stakeholder environment, such as negotiation of complex financial transactions with governments in unstable institutional environments Improper Implementation of key program and project management processes.

 

Lack of understanding of local situations. Poor risk identification.

It is hard to invest in a country that is political unstable.

 

Also have they identified the MSEW payment problems? They should have known that those State power company won’t push people to give them payment if people bribe them. This problem make the whole plant fail.

 

That’s why the new party United Progressive Alliance, try to stabilize the political and rebuild the confidence to the foreigner investors by giving them some money,

 

Accusations of corruption in the government association of the project

 

“Antagonism towards Dabhol was accentuated by a statement before aUScongressional

hearing by a senior company official that Enron had spent US$20 million in education in

Indiato show the benefits of private power projects,44 a sum which many inIndiainterpreted

to mean bribe money.[12]”

Improper Implementation of key program and project management processes

 

Need more local understanding network (stakeholder interests)

 

Ignore the project environments.

Typical

 

But get a clear pictures(map) of how Indians (or Chinese) works from white people was not easy.

 

When Enron do a foreign investors project, they should have even local knowledge to asses if the political party is stable. If the power get overthrown, are you going to lose the projects etc. But probably they can just keep bribing the new party to keep the project going. They don’t have enough local knowledge to predict this will happen

 

 

 

But nowadays, out –sourcing is a global trend. White people should know to make project work in china orIndia, projects won’t get smooth without bribing. Also they might get halt if someone get bribed as well.

 

Don’t ask. Just bribe them (conclusion).

Project became a pawn in the volatile of the Indian political environment

 

“In March 1995, prior to the commencement of construction of Phase I  a new coalition of

the nationalist Bharatiya Janata Party (.BJP.) and the Hindu nationalist Shiv Sena replaced

the Congress state government that had been responsible for entering into the Dabhol contract.

Both the BJP and the Shiv Sena campaigned for election on an anti-Dabhol platform, fanning

the widespread perception that dealings with foreigners were likely to be to India.s

disadvantage[13]

 

Improper Implementation of key program and project management processes

 

Lack of stakeholder information and local political assessment.

 

Don’t bother building in fallback options

 

Ignore the project environments.

Not as typical.

 

How political being unstable is not easy to predict for foreigners  without good local knowledge.

 

When Enron do a foreign investors project, they should have even local knowledge to asses if the political party is stable. If the power get overthrown, are you going to lose the projects etc. But probably they can just keep bribing the new party to keep the project going. They don’t have enough local knowledge to predict this will happen

 

 

Foreign investors should access political environment before stepping their toes into the mess.

Completion of project suspended for years, at great cists because Enron collapsed in the interim. Improper Implementation of key program and project management processes

 

Don’t bother building in fallback options

 

Ignore the project environments.

 

Lack of business integrity and ethics, (even for theUScompanies)

This is not typical. (before).

But this is typical nowadays because many big brands got bankrupted.

 

How would you know beforehand 2002 before it would crash. It is one of the most renowned power company in theUnited States.

 

Did anyone say something before the scandal happen? (with author Anderson)

 

But company always bribe others won’t be clean themselves anyways.

 

But I don’t any foreign companies don’t bribe if they open offices and plants in developing countries.

 

 

 

 

 

3. In the development of a Project Management Office, how would you address the “white space risk” and the “integration risk” discussed in the assigned article “Why Good Projects Fail Anyway.”

Unless the end product is very well understood, as it is in highly technical engineering projects such as building an airplane, it’s almost inevitable that some things will be left off the plan. And even if all the right activities have been anticipated, they may turn out to be difficult, or even impossible, to knit together once they’re completed. Managers use project plans, timelines, and budgets to reduce what we call “execution risk”—the risk that designated activities won’t be carried out properly—but they inevitably neglect these two other critical risks—the “white space risk” that some required activities won’t be identified in advance, leaving gaps in the project plan, and the “integration risk” that the disparate activities won’t come together at the end.

 

initiatives description how
Rapid-Results Teams Work

Results Oriented

A rapid-results initiative is intentionally commissioned

to produce a measurable result,

rather than recommendations, analyses, or

partial solutions.

Even each teams have done their part and give out the effort. If the whole thing is not working, or some accidents happened, they are still considered as failed.
Vertical. Project plans typically unfold as a

series of activities represented on a timeline by horizontal bars. In this context, rapid-results

initiatives are vertical. They encompass a slice of several horizontal activities, implemented

in tandem in a very short time frame. By using the term “vertical,” we also suggest a

cross-functional effort, since different horizontal

work streams usually include people from different parts of an organization

By intensively putting people in all expertise to complete one tasks, unknown/integration risks can be identified more easily/minimize/mitigate.

 

If something unexpected happen, the cross disciplinary collaboration would speed up fixing the problems.

Fast The short time frame fosters a sense of

personal challenge, ensuring that team members

feel a sense of urgency right from the

start that leaves no time to squander on big

studies or interorganizational bickering.

People always think the tasks have to be done the next day. So they won’t slack. If those white and integration risks happen, they would try to fix it as soon as possible.

 

Also by doing work faster, they leave more time and budget in case something very bad happen. (white risks and integration risks).

A Shift in Accountability the team is free—indeed,

compelled—to find out what activities

will be needed to produce the result and how

those activities will fit together.

 

This approach puts white space and integration risk onto the shoulders of the people doing the work. That’s appropriate because, as they work, they can discover

on the spot what’s working and what’s not. And in the end, they are rewarded not for performing a series of tasks but for delivering

real value. Their success is correlated with benefits to the organization, which will come not

only from implementing known activities but also from identifying and integrating new activities.

     
     

 

 

Why is it hard to recognize impending failure? What are some of the avoidance techniques for limiting the impact of bad projects?

 

Problems description
face of resistance from the project manager, team members, and upper management proponents. Their opposition is understandable because

by this time they have a personal, ego

stake in the project. Consequently, they keep digging, convinced that somewhere under all the detritus of escalating costs, poor performance, and sliding schedules, there must be a pony!

The mis-belief that throwing more money at a project will somehow “buy” success. unless a project is truly suffering from a

dearth of funding, increasing its budget will usually not bring the kinds of returns hoped for.

 

The larger question is whether or not the firm will receive due value for the additional monetary support.

 

The extra money given to a troubled project does not necessarily correlate with an improved likelihood of success.

the common threads that runs through many of the better-known project failures is the company’s unwillingness to back away from a poorly managed development process or product introduction Worse, it is common to actually commit more and more resources to a losing hand.
It is important here to distinguish between adding resources to a project that is in trouble and simply reacting in a “knee-jerk” fashion by increasing funding.  
   

 

[1] Parry, S. (2001) .Enron.sIndiaDisaster.,

[2] Hill, C.W.L. (2005) op. cit.

[3] Anderson, F. (2001) .Free and Clear of Enron.s Woes., Business Week,

[4] Hill, C.W.L. (2005) op. cit.

[5] Human Rights Watch (1999) op. cit.

[6] Choukroun, S. (2002) op. cit.

[7] Allison, T. (2001) op. cit.

[8] Dutta, S. (2002) .The Enron Saga.,ICFAICenterfor Management Research.

[9] Hill, C.W.L. (2005) op. cit.

[10] Human Rights Watch (1999) op. cit.

[11] Human Rights Watch, (1999), cit

[12] Human Rights Watch, (1999). Cit

[13] Sutta, S. (2002) op, cit

[14] Wall Street Journal,, (1996)“Eurotunnel Suspends Interest Payments,”

 

Eric Tse, Richmond Hill, Toronto
Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting
http://tsetseconsulting.webs.com/index.html
https://tsetseconsulting.wordpress.com/
http://erictse2.blogspot.com/

Big Dig

Edit Submission: Assignment 5.1 – Big Dig and Eurotunnel Case Study (Attempt 1 )

 

The Central Artery Tunnel Project known as the Big Dig and the English Chunnel are two of the largest projects ever undertaken in their respective countries and, for projects of these types, in the world. Both of these projects were public projects, yet one was financed entirely from public funds, and the other was financed largely by private investors. Because each of these projects consisted of numerous smaller projects, both were managed as programs. Based on your readings and outside research, respond to the questions below.

  • Utilizing the information discussed in the Big Dig case study and the readings for this week’s class as well as research available on cost estimation, select one aspect of the management of cost estimation from a program management perspective, and describe in a two-page response how you would improve cost estimation on mega projects through implementation of this procedure or policy.

 

 

 

 

 

 

Cost estimation ( 2 pages)

 

Aspect of the management of the cost estimation from program management perspective

One aspect of the failure to fail cost estimation is the failure the asses the impact of unknown subsurface conditions, environmental and mitigation costs, required 1500 separate mitigation agreements, inflation adjustments, and expanded scope. [6] One of the major factors in cost escalation was the impact of inflationary pressures on all project elements of more than a decade of design and constructions.

 

 

 

 

 

 

 

 

How to improve cost estimation on mega projects through implementation of this procedure or policy?

First the root cause of under-estimation is due to cost that associated unknown risks.

First we need to understand why the risks are unknown. If we can have a more rigors risks identification plan and policies, evaluation at the beginning of the project, many of costs risks may be identified earlier for particular tasks.

We would need contingency funding for each identified risks in the risk management plan and cost break down structure. [7]. For cost estimation of the identified risks, the easiest way you can do is to calculate the cost of lost and the impact of the lost.

There are more complex models to quantified the risks, such as contour method, experts and historic Data, expected Value, Statistical Sums/ Probability Distribution (PERT), schedule simulation/risk modeling and decision trees. [7]

Another area is the unidentified risks. From the articles about big dig. We know the big dig is one the most pioneer civil engineering projects on its kind. [8]. The are trying to build massive network of tunnels underneath the heart ofBostoncity. There are many engineering challenges that have never been tried out and encountered. This kind of projects generate huge amount of unidentified risks. So how are we going to estimate this kind of projects?

 

In most projects, there is something called contingency funding/ management reserve. Some of them is to cover costs for unidentified problems that happens during the projects. Usually it is around 10% to 15% percent of the whole cost of the projects.

However with this kind of pioneer and risky projects, they may be able to negotiate a higher percentage of the projects.

From a program management perspective, they consists of many projects. So I think first we need to identify all the projects needed to be completed. There can be projects come up in the middle of the program, but still we need to identify them as much as you can possible.

Of course the program is too risky, you may want to divide thee program in to phases of projects. You may want to start with something that is easier to accomplish with better visibility to the public and so that they can generate a good image to the public for further funding. It is not easy to raise all the funding at the beginning of the projects. Some of them can be pilot projects if they are too technical risky.

For each project they need to identify the risk very rigorously, to get as much potential risks as possible and put them into the cost calculation/estimations. Usually stakeholder would say this cost too much just because you want to allocate money to something that “might” happen. But it would be better to find out earlier than later.

At the end they should reserve fat management reserve funding for projects that is considered as technological risky or pioneering and no one have done it before.

 

 

 

 

 

 

  • What was the root cause of the Big Dig and the Eurotunnel’s difficulties? Describe the similarities and the differences. With the benefit of lessons learned, if you represented the investors in the Eurotunnel project and the public citizens in the Big Dig, describe three practices you would have recommended from a program manager’s perspective to assure a higher return on investment (ROI) within a reasonable time period.

 

Root cause Big Dig and Euro Tunnel Similarities and the differences, details, and what we can do
The failure to properly estimate costs from the inception of the project. In Big Dig project, the failure to properly assess the impact of unknown subsurface conditions, environmental and mitigation costs, required 1500 separate mitigation agreements, inflation, adjustments, and expanded scope.
The failure to enforce the contractual provisions once construction commenced  
Political Reality: Real cost is far more than initial estimation. Cost initial estimation is low, but cost would dramatically increase later. People would think the project is cheating unless and open and transparent process is essential to accurate and realistic cost estimation and budget forecasting.

Flyvberj underestimation of costs is a rule, not an exception [1]

 

Political Reality: public want to see immediate return on investment Flyvbjerg notes that underestimation of costs at the time of the decision to build is the rule rather than the exception for transportation [2].

Also if the estimation is to accurate and to high at the beginning, people may lose interests in investing money at the beginning

   
   

 

3 practices  
every megaproject of $1 billion or more receiving Federal funds for construction have a financial plan that is updated annually. [3]  
MetropolitanCollegehas commenced a Mega Project Research Enterprise with the Big Dig as a prototype to develop a data bank of lessons learned that will be useful to everyone . Whose interests are at risk due to the lack of available quality information on the development and construction of major infrastructure projects worldwide.  
World Bank projects are typically subject to more careful appraisal and control than most other infrastructure projects, but projects undergoing the Bank’s relatively rigorous procedures, also have shown consistent patterns of inflated project viability. [4]To address this problem, the World Bank has called for not only more accuracy in estimates of viability, but also more honesty. allocate more contingency funding and management reserve  
   

 

[1] Bent Flyvbjerg, (2006) Underestimating Costs in Public Works Projects, Journal of the American Planning Association.

[2] Bent Flyvbjerg, Nils Bruzelious and Werner Rotherngatter, (2006),  Megaprojects and Risk,CambridgeUniversityPress,

[3] Author, (date), The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) redefined a megaproject to include projects of $500 million or more.

[4] World Bank, (date) ECON Report, Economic Analysis of Projects, p. 21.

[5] World Bank, (1994) World Development Report, p. 17.

[6] The John W. McCormack Institute of Public Affairs,UniversityofMassachusettsBoston(1997), Report to the Legislature on Managing the Central Artery/Tunnel Project: Exploration of Potential Cost Savings

[7] Vijay Kanabar, (2008), Project Risk Management, A Step by Step Guide to Reducing Project Risk

 

 

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Eric Tse, Richmond Hill, Toronto
Tse and Tse Consulting -Security, Identity Access Management, Solution Architect, Consulting
http://tsetseconsulting.webs.com/index.html
https://tsetseconsulting.wordpress.com/
http://erictse2.blogspot.com/

 

 

Siemens Case

 The Siemens cases present a real life example of a company that needs to solve major project problems with a very large multinational project. The case involves cultural, political, technical and geographical issues. Respond to the questions below utilizing the facts from the case studies, class readings, and your outside research.

1. Why should a company consider building a global R & D Network?

First, because of local labor shortages, ICN could simply not centralize all product development atMunich. Second, having regionally-based managers, engineers and technicians facilitated rapid response to local needs such as EWSD customization

2. What are the positives and negatives to building a global R & D Network?

Negatives:

–         Great variance existed between different centers

–         Tension between centralizedMunichmanagement centers and global R&D centers. How much independency are we going to give them? How much direction are we going to give them?

–         Hard to co-ordinates international efforts. (virtual teams and etc)

–         Matrix project structure, hard to manage. Workers don’t know who is the boss of the tasks.

–         Slow troubleshooting and escalation process. No motivation for people to troubleshoot.

Positives:

–         Pull Research talents from all over the world

–         Have regional specialization on their research expertise

–         Can increase the breath of research scope by having more resources and knowledge.

–         May save money if centers are build in countries with lower expenses.

–         Motivate internal competitions and collaboration among centers, enhancing research quality and standards.

–         Different research under local needs for product customization and internationalization.

3. What has gone wrong with the ADMOSS and NetManager projects from theBangaloreandMunichperspectives?

ADMOSS

 

Bangalore

Munich

Not enough directions and guidance at the beginning fromMunich. People have to groups thing in the dark.

Compared to German standards, the Indian product is not on time and not in high quality.

Increase frustration and anxiety of stopping work because of cutting budget or changing requriements

 

Hard to do integration test or development, because they are too far away fromGermanyto communicate about the problems.

 

Trips to Europe fromIndiano fun. Not as fun as they expected. Have them fixed other customer problems that can be fixed by local team.

German manages want to go toBangaloreto have big meetings. But for Indian culture, they prefer small meetings.

High tuirnover rate because of heated local job market

German people think Indian are not materialistic.

Cultural awareness materials and role playing exercise is simplistic and out of date, didn’t take wide cultural variation account inindia

Indian people too polite, never complains even they have to complain sometimes.

There is no problem means: there is no problem on the sub system they are working

There is no problems means: there is no problem on the entire system

Solve problems first

Document problem first

Doesn’t care unless you give them sense of belonging

Follow customers-defined specifications out of sense of duty

Will to cover each other time to keep project rolling.

They doesn’t care. Individual is first piority

 

 

 

 

 

 

****

 

NetManager Project

 

Bangalore

Germany

They are cheap

Indian people are getting costly.Eastern Europeare even more cheaper

When crisis happen, they tend to spend extra time on their own to get things resolved. Also they give up their vacations.

Summer time, people take time off, without contact information. Hard for Indians to find them if they have problems.

Blaming German testers and analysts didn’t them enough directions and monitoring to make sure things have been done correctly.

The Indians don’t have enough knowledge to make correct assumptions for product design.

They should be able take care of themselves

 

 

 

 

 

 

4. What should Siemens ICN have done differently to avoid the NetManager crisis?

Proposal 1: Transfer all core project activities back toEurope, so that they have better time and quality control.

Proposal 2: Transfer just accountability, management and major responsibilities back toMunich, leaving all development activities back inBangalore.

Proposal 3: Enhance co-ordinations, internal understanding, communication.

 

5. How should the cultural differences betweenIndiaandGermanyhave been addressed early in the project before setting up a new development site abroad?

Resource report said  “2/3 of executives polled said theyhad experienced miscommunication issues within their global sourcing operations, compared with 6 out of 10 among executives at companies that offered cross-cultural training among employees. Need cross cultural training before or during the site setup. [1][2] (Paton, 2006) (Hurn 2007)

Not all training is successful. The organization must understand that merely knowing the national language is not enough. The manager assigned to the nation must be able to understand and adapt to the culture of the nations and the nature of the organizations. [3] (Hurn 2007)

 

6. How could project management have been improved in the areas of product planning, development, and testing?

Use the PMBOK way.

–         Have a well define scoping and planning methodology.

–         Have a well established communication plan and communication methodology

–         Have a well established quality and change management technology.

–         Have a strict development (SDLC etc) life cycle methodology.

–         Have a strong and effective project monitoring and control methodology

–         Have a better virtual team management

 

 

[1] Dean Elmuti; Benjamin Tück; Friederike Kemper,  Sep 2008, Analyzing Cross-Cultural Adaptability among Business Students: An Empirical I… International Journal of Management;

[2] Paton, N, 2006, Cultural ignorance the biggest barrier to outsourcing success. Management Issues.

[3] Hurn, B.J. (2007), Pre-departure training for international business manager, Industrial & Commercial Training. Vol 29. Issue 1

[4] Stefan Thomke, 2002, Siemen AG: Global Development Strategy (A)

[5] Stefan Thomke, 2002, Siemen AG: Global Developpment Strategy (B)

[6]  Author ,2003, Project Management Body of Knowledge, PMBOK, 3rdedition

 

 

 

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Eric Tse, Richmond Hill, Toronto
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