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No deal !” said the union . “The current method of evaluating government em ployees at this agency is terrible, and if a change doesn’t occur, we’ll be in court seeking damages.” In 1984, a government agency approved and initiated an ambitious project, part of which was to develop an updated, automated evaluation system for the 50,000 employees located throughout the United States. The existing evaluation system was antiquated. Although there were forms used for employee evaluation, standardization was still lacking. Not all promotions were based on performance. Often, it was based on time in grade, the personal whims of management, or friendships. Some divisions seemed to promote employees faster than others. The success or failure of a project could also seriously impact performance opportu nities. Some type of standardization was essential. In June 1985, a project manager was finally assigned and brought on board. The assignment of the project manager was based upon rank and availability at that time rather than the requirements of the project. Team members often pos sessed a much better understanding of the project than did the project manager. The project manager, together with his team, quickly developed an action plan. The action plan did not contain a work breakdown structure, but did contain a statement of work which called out high-level deliverables that would be es sential for structured analyses, design and programming. The statement of work and deliverables were more so in compliance with agency requirements for struc tured analyses, design, and programming than for the project’s requirement. The entire action plan was prepared by the project office, which was composed of eight employees . Bids from outside vendors were solicited for the software packages, with the constraint that all deliverables must be operational on existing agency hardware. In October 1985, the award was made by the project office to Primco Corporation with work scheduled to begin in December 1985. In the spring of 1986, it became apparent that the project was running into trouble and disaster was imminent. There were three major problems facing the project manager. As stated by the project manager: 1. The requirements for the project had to be changed because of new regu lations for government worker employee evaluation. 2. Primco did not have highly skilled personnel assigned to the project . 3. The agency did not have highly skilled personnel from the functional ar eas assigned to the project. The last item was argumentative. The line managers at the agency contended that they had assigned some of their best people and that the real problem was that the project manager was trying to make all of the decisions himself without any input from the assigned personnel. The employees contended that proper project management practices were not being used. The project was being run like a dic tatorship rather than a democracy. Several employees felt as though they were not treated as part of the project team. According to one of the team members, The project manager keeps making technical decisions without any solid foundation to support his views. Several of us in the line organization have significantly more knowledge than does the project manager, yet he keeps overriding our recommendations and decisions. Perhaps he has that right, but I dislike being treated as a second- class citizen. If the project manager has all of this technical knowledge, then why does he need ? us^ prime In June 1986, the decision was made by the project manager to ask one of the assistant agency directors to tell the union that the original commitment date of January 1987 would not be met. A stop workage order was issued to Primco, thus canceling the contract. The original action plan called for the use of existing agency hardware. However, because of unfavorable publicity about hardware and software prob lems at the agency during the spring of 1986, the agency felt that the UNIVAC System would not support the additional requirements, and system overload might occur. Now hardware, as well as software, would be needed. To help maintain morale, the project manager decided to perform as much of the work as possible in-house, even though the project lacked critical resources and was already more than one year late. The project office took what was de veloped thus far and tried to redefine the requirements. With the support of senior management at the agency, the original statement of work was thrown away and a new statement of work was prepared. “It was like starting over right from the beginningremarked one of the employees. “We never looked back at what was accomplished thus far. It was a whole new pro ject!” With the support of the agency’s personnel office, the new requirements were finally completed in February of 1987. The union, furious over the schedule slippage, refused to communicate with the project office and senior management. The union’s contention was that an “il legal” evaluation system was in place, and the current system could not properly validate performance review requirements. The union initiated a lawsuit against the agency seeking damages in excess of $ 21 million. In November 1986, procurement went out for bids for both hardware and a database management system. The procurement process continued until June 1987, when it was canceled by another government agency responsible for pro curement. No reason was ever provided for the cancellation. Seeking alternatives, the following decisions were made: 1. Use rented equipment to perform the programming. 2. Purchase a database management system from ITEKO Corporation, pro vided that some customization could be accomplished. The new database management system was scheduled to be released to the general public in about two months. The database management system was actually in the final stages of devel opment and ITEKO Corporation promised the agency that a fully operational ver sion, with the necessary customization, could be provided quickly. Difficulties arose with the use of the ITEKO package. After hiring a consultant from ITEKO, it was found that the ITEKO package was a beta rather than a production version. Despite these setbacks, personnel kept programming on the leased equipment with the hope of eventually purchasing a Micronet Hardware System. ITEKO convinced the agency that the Micronet hardware system was the best system available to support the database management system. The Micronet hardware was then added to the agency’s equipment contract but later disallowed on September 29, 1987, because it was not standard agency equipment. On October 10, 1987, the project office decided to outsource some of the work using a small/minority business procurement strategy for hardware to sup port the ITEKO package. The final award was made in November 1987, subject to software certification by the one of the agency’s logistics centers. Installation in all of the centers was completed between November and December 1987.


1. Is there anything in the case that indicates the maturity level of project man agement at the agency around 1985-1986 ?

2. What are the major problems in the case?

3. Who was at fault?

4. How do you prevent this from occurring on other projects?


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