Case Study Analysis : Franklin Electronics

Part of the Earned Value Management technique is the monitoring of variances from the approved baseline of costs and schedule. The variances are useful in determining the overall project health and status.

Week 4 DQ 1 Resource Allocation and Leveling PROJ 592 Week 4 DQ 2 Advanced Schedule Techniques PROJ 592 Week 5 DQ 1 Earned Value Calculation PROJ 592 Week 5 DQ 2 Project Monitoring and Control & EV PROJ 592 Week 6 DQ 1 Forecasting Project Completion Cost PROJ 592 Week 6 DQ 2 Project Control PROJ 592 Week 7 DQ

| a) Using the traditional method of assessing project performance, we would be able to see if we have been over or under budget and timelines, and we would only have this information once the project has been completed. However, with the traditional approach would not be able to effectively track project performance at a task level and at any given point in time. Due to this, decisions that may need to be taken during the project or identifying issues or project health during project execution is more difficult using traditional approaches than using the EVM process. b) The EVM process is based on tracking the schedule and cost performance at a task level on an on-going basis, that will help determine project task level and overall status with effective indicators that would help make project related decisions. In the EVM process, a baseline plan is made for project costs and timelines and then these are tracked against actual costs and work completion to find out the cost variances and schedule variances and cost and schedule indexes, that will help determine how the project is performing on these parameters. If the variances are in negative or if the indexes are less than 1, it means that the task or the project is behind on cost and schedule and

The impact of Earned Value analysis in managing project cost control is undeniable. When EVM is implemented on a project, there are significant benefits to the project manager and the customer. Project manager benefits include increased visibility and control to proactively respond to issues that can impact project schedule, cost and objectives. Customer benefits include increase confidence in the PM’s ability to manage the project and track the progress of their project. Additionally, EVM provides a wealth of information for accountants. Accountants can use the data to report profitability to the investment community (Wilkens, 1991). There is a true connection between project management and corporate accounting. PMs use data provided by finance departments as inputs to determine cost performance of projects via EVM. This includes information used to create financial statements such as the cash flow statement, used to track the actual cash in hand. Said financial statements are to be crafted in compliance with the U.S. GAAP (generally accepted accounting principles). GAAP impacts every item on a qualifying financial statement. GAAP guidelines dictates how financial statements are produced every step of the way, covering hundreds of different components, according to Stanford University’s Cardinal Money Management website (Gresham, 2012). GAAP encompasses basic accounting principles and guidelines and detailed standards issued by the Financial Accounting Standards Board

In this case, we need to investigate the status of the MED-X implementation project. The method we adopt is EVM, Earned Value Management. Earned Value Management is a project management technique for measuring project performance and progress. We measure the project performance not only as a whole, but also by performance of its components.

Project Management Institute. (2000). _A Guide to the Project Management Body of Knowledge (4th ed.)._

1) What can you determine about the corporate culture from the fact that they waited this long to consider the development of an EPM system?

It is clear to see that throughout the project the tasks and progress were monitored very closely. The project is heavily dependent on the resources provided by its shareholders and in turn they rely on regular updates to reassure them on their investment. In the construction and building industry the methods and application of project management tools are very reliable and well tested. Therefore, it could benefit the project if the it was managed with detailed and defined practises and also follow standards set and agreed upon on a international level.

Spokane Industries has contracted Franklin Electronics for an 18 month product development contract. Franklin Electronics is new to using project management methodologies and have not been exposed to earned value management methodologies. Even though Franklin and Spokane have worked together in the past, they have mainly used fixed price contracts with little to no stipulations. For this project Spokane Industries is requiring Franklin Electronics to use formalized project management methodologies, earned value cost schedules, and schedules for reports and meetings. Since Franklin Electronics had had no experience with earned value management, the cost accounting group was trained in the methodology in order to bid for the

In 1975 Pioneer maintained relationships with approximately 3,500 franchise retail outlets, the retail outlets benefited from a 5% Pioneer investment in local advertising, and attractive gross margins and credit terms. However, that same year, Pioneer and three competitors were forced to sign consent decrees with the U.S. Federal Trade Commission promising not to engage in alleged anti-fair competition practices – namely requiring distributors to use suggested list prices and punishing those distributors who didn’t comply either through delayed shipments or revoked franchises. A market price war followed the signing of the consent decrees, lowering franchise’s profits while increasing revenue for Pioneer. Pioneer followed

Franklin Equipment Ltd. (FEL) was established 75 years ago in Maritime Provinces, having headquarters in Saint John, producing large machines for construction business. FEL’s main focus is on manufacturing of rock-crushing equipment for construction of Dam and highway construction. At present, FEL designs, produces and assembles both stationary and portable rock-crushing plants.

Expectations of the stakeholders and customer need to be in line with the project objectives and deliverables. During project initiation, it is critical that those expectations are outlined in approved baselines so performance can be measured throughout the project. With the utilization of established baselines, performance can be measured using earned value management and reported accordingly. This will also ensure that contractual requirements are being maintained, which is critical in today’s competitive environment. This will also assist in creating the scope, budget and schedule baselines so performance throughout the project can be measured to ensure performance is meeting everyone’s needs and expectations. This paper will outline the re-carpeting project and further establish viability verification, threshold establishment, overhead costs and management oversight. Finally, using Earned Value Management (EVM) can provide all key personnel a snapshot of where the project stands at any given point during the entire life cycle.

1. The main criteria FEL uses to assign managers to their projects include time constraints and expertise. Clearly, managers with heavy workloads will not do as well as those without significant current time constraints. Hence, the likelihood that the work will progress smoothly under such managers is greater than otherwise. Expertise is also an important requirement to ensure that a project runs smoothly. Hence, the combination of low time constraints with the highest level of expertise appears to be a good basis for successful projects. However, one potential danger of assigning an apparently random number of managers to teams who need to work closely together could create communication problems, especially if these managers have not worked together before, or indeed if severe personality clashes occur. Hence, it might be a good idea to conduct regular assessments of the progress of the work as well as how well managers function together, particularly in a remote location such as Abu Dhabi.

Earned value is a tool that helps project manager to assess the amount of budget to complete the project. It helps to identify the final required fund to get the project done. It allows to measure and finalized the budget that will take place while project will be running from 1% to 100% lifecycle. It can provide signals and warnings to project manager. If these early warning signals convey unacceptable readings to the project manager, steps can be immediately taken to avoid the undesired results.

The paper is divided into three sections, the first of which will establish a timeline of events. This project background will serve as a case study for the analysis in the following section that will be structured such that each of the previously mentioned facets will be independently analyzed and contrasted with project management principles. Finally the paper will conclude with a summary of the analysis and recommendations based on