Automotive Manufacturer Slashes HR Service Costs by 66% in Just Seven Months Within seven months of program completion, HR expenses were reduced from US $20 million to $6.8 million per year. Company As a multi-billion dollar world leader in manufacturing automotive components, this companys customer base includes virtually every major manufacturer in the global automotive, commercial vehicle, and off-highway markets. Challenge As the company emerged from bankruptcy protection, its Human Resources (HR) executives wanted to reduce service costs, which were averaging US $20 million annually. They developed a strategy to right-source key HR functions that had been outsourced to a single contractor. By bringing the majority of services back in-house, and partnering with an array of best-in-class service providers for select elements of the program, the company expected to both improve HR services and cut costs dramatically. Overall, there were 15 discrete projects included in the HR Transformation Program, encompassing all aspects of HR service delivery, such as Payroll, Benefits, Health and Welfare, and Pensions. After eight months, however, the entire program was in jeopardy. Key milestones and deliverables were not being met for any of the projects, and critical cost overruns were adding up. With just four months remaining to complete the entire HR Transformation Program, the CIO realized that the organization did not have the program management expertise to achieve the expected results. Solution On a Thursday evening, the CIO asked PM Solutions to assume program management oversight for the HR Transformation Program. The following Monday morning, PM Solutions provided the first of two world-class Program Managers to turn around and recover the troubled initiative. Results All 15 projects within the program were completed on schedule and on budget, with no service disruptions or outages during the pilot, transition, or go-live phases. Within seven months of program completion, the client had reduced HR expenses from US $20 million to $6.8 million per year, and is targeted for a $5 million per year run rate. Due to the success on this initiative, PM Solutions continued to work with this client to build an organizational project management methodology, mature portfolio management practices, and help improve project execution across the organization. Source: https://www.pmsolutions.com/case-studies/view/automotive-manufacturer-slashes-hr-service-costs Answer ALL the questions in this section. QUESTION 1 (20 Marks) Project cost estimation can be undertaken at several levels. The case study project derived great value from the prudent cost management initiatives undertaken by the team. Critically analyze and discuss the cost estimating techniques that the case study project team could have endorsed to accurately estimate the project costs for masters level project management.