Codeword

Codeword is a medium-sized firm that designs and manufactures electronic systems for the mass transit industry. It competes with other firms to win contracts to provide such systems. When Codeword receives a contract, it creates a project to complete the work. Most projects range from $10 million to $50 million in cost and from one to three years in duration. Codeword can have 6-12 projects going on at any one time, in various stages of completionsome just starting and others finishing.

Codeword has a handful of project managers who report to the general manager; other people report to their functional manager. For example, the electronics engineers all report to the manager of electrical engineering, who reports to the general manager. The functional manager assigns particular individuals to work on various projects. Some people work full time on a project, whereas others split their time among two or three projects. Although individuals are assigned to work for a project manager on a specific project, administratively they still report to their functional manager.

Jack Kowalski has been with the company for about 12 years, since graduating from college with a BS in electronic engineering. He has worked his way up to senior electronics engineer and reports to the manager of electrical engineering. He has worked on many projects and is well respected within the company. Jack has been asking for an opportunity to be a project manager. When Codeword is awarded a $15 million contract to design and manufacture an advanced electronics system, the general manager promotes Jack to project manager and asks him to run this project.

Jack works with the functional managers to get the best people available assigned to the project. Most of the people are buddies who have worked with Jack on previous projects. However, with Jack's position as senior electronics engineer vacant, the manager of electrical engineering has no one with the appropriate level of expertise to assign to Jack's project. So the manager hires a new person, Alfreda Bryson. Lured away from a competitor, Alfreda has a Ph.D. in electronic engineering and eight years' experience. She was able to command a high salarymore than Jack is making. She is assigned to Jack's project full time as the senior electronics engineer.

Jack takes a special interest in Alfreda's work and asks to meet with her to discuss her design approaches. Most of these meetings turn into monologues, with Jack suggesting how Alfreda should do the design and paying little attention to what she says.

Finally, Alfreda asks Jack why he is spending so much more time reviewing her work than that of the other engineers on the project. He responds, "I don't have to check theirs. I know how they work. I've worked with them on other projects. You're the new kid on the block, and I want to be sure you understand the way we do things here, which may be different than at your previous employer."

On another occasion, Alfreda shows Jack what she thinks is a creative design approach that will result in a lower-cost system. Jack tells her, "I don't even have a Ph.D. and I can see that that won't work. Don't be so esoteric; just stick to basic sound engineering."

During a business trip with Dennis Freeman, another engineer assigned to the project who has known Jack for six years, Alfreda tells him that she is frustrated with the way Jack treats her. "Jack is acting more like the electronics engineer for the project than the project manager," she tells Dennis. "Besides, I have forgotten more about designing electronics than Jack ever knew! He really isn't up to date on electronic design methodologies." She also tells Dennis that she's planning to discuss the matter with the manager of electrical engineering and that she would never have taken the job with Codeword if she had known it was going to be like this.

CASE QUESTIONS

1. Do you think Jack is ready to serve as a project manager? Why or why not? How could Jack have prepared for his new role?
2. What is the major problem with the way Jack interacts with Alfreda?
3. Why do you think Alfreda has not had an open discussion with Jack about the way he is treating her? If Alfreda approaches Jack directly, how do you think he will respond?
4. How do you think the manager of electrical engineering should respond to this situation?

Factory Expansion Project

Jacob Clemson is the owner of Digitsig, Inc., a growing Canadian electronics company. The company has been receiving orders from customers worldwide, and sales have been expanding rapidly. The factory is now working three shifts and is at capacity. Jacob had to lease additional space in a building several miles away. He knows he must expand his factory to keep up with growing demand, to increase efficiency, and to reduce the costs associated with trucking materials and product back and forth between his factory and the building he is leasing. The cost of the lease was very high because there just was not much good available space in the area and Jacob was desperate to get additional space right away, or he would not be able to keep up with demand and customers would go to his competitors.

Jacob met Andy Gibson, part-owner of AG Contractors, at a recent business networking event. He told Andy about his expansion needs. Andy said, "We can do that for you, Mr. Clemson. We've done many similar projects. As you may know, business is booming in the region, and getting a contractor won't be easy. But it could be lucky we met because we are just finishing up another project and could probably get working on yours if we can get an agreement soon. I've got four other proposals pending, and if they come in, we won't be able to handle any other projects. And like I said, I understand all the other contractors are just as busy. It sounds like you really need to start on this factory expansion right away, and I think we can help you out."

Jacob became worried that he might not be able to get another contractor, and he did not want to waste any more time. So he signed a contract with AG Contractors, for what he thought was a reasonable price, to design and build the expansion to his factory. The expansion space would be used primarily for inventory storage of incoming materials and finished goods. He agreed to a bonus clause in the contract to pay AG Contractors a 10 percent bonus if it completed the building in 12 months rather than the 15 months Andy told him it would normally take.

It is now 14 months later. Andy Gibson and Gerri Penk, a recently hired project manager for AG Contractors, walked into Jacob Clemson's office. The receptionist asked, "May I help you?"

Andy asked, "Is Jacob in?"

"Yes, he is. Do you have an appointment?" responded the receptionist. Andy hurried by the receptionist, saying, "I don't need one. This will only take a minute." A surprised Gerri followed after him. He knocked on Mr. Clemson's door once, opened it, and walked in without waiting for a response.

Astonished, Jacob Clemson looked up and said, "I'm right in the middle of this important...."

Andy interrupted. "This will only take a minute. I just wanted to say that we got your factory expansion project completed on time and within budget. We finished in 12 months, just like I knew we, I mean, like I hoped we would. I had to kick butt with some of our subcontractors, but that's the way it goes in this business. Sometimes you've got to be an SOB to get the job done. I'm sure you're the same way, Jacob, or you wouldn't be where you're at."

Jacob Clemson spoke up. "Well, there were some problems...."

But Andy interrupted again. "In a big project like this, there are always problems, and some people's feathers get ruffled. But that always happens. Don't be concerned about that. In the end, it all worked out. I thought maybe we could go to lunch to celebrate, but we have another meeting across town. Give me a call sometime, and maybe we can get together and see if I can help you with any other projects you might have." Andy then turned and quickly left Jacob's office, walking right past Gerri, who ran to catch up with him.

After they left, Jacob was somewhat stunned and became furious. He thought to himself, "Another project? Over my dead body. An SOB? What kind of person does he think I am? Getting the project done on time and within budgetdoes he think that is all that it's about? This project was a nightmare. It finished up costing about 50 percent more than AG's original price because of all the changes they came back with. They never asked, never listened, never told me what was going on, and never returned my phone calls. What a bunch of jerks! I'll never do business with them again."

As Andy and Gerri walked to Andy's car, he told Gerri, "There you go, another satisfied AG customer. And a pretty naive one too," Andy chuckled. "I knew we could get the project done in 12 months. But I knew he was desperate, and I told him it would take 15 months, and then got him to agree to a bonus payment if we got it done in 12 months."

Gerri asked, "Andy, isn't that unethical?"

"Hey, business is booming for Digitsig; they have plenty of money. Besides, it's his problem for waiting so long before deciding on doing the expansion anyway. He was lucky we helped him out of a bind. But I've got to tell you, Gerri, I wondered why he was building all that warehouse space for inventory when most other businesses are going to just-in-time deliveries. But I wasn't about to tell him that. It's amazing he's in business at all. Oh, well, you'll find out it's a dog-eat-dog world out there, Gerri."

Gerri responded, "Andy, I got a sense that maybe Mr. Clemson wasn't totally satisfied. I mean he really didn't say he was."

"He didn't say he wasn't either," snapped Andy. "Besides, he never seemed interested in the project, he never asked to have any meetings, and when I tried to schedule a meeting, he was too busy. And then his payments were always latelike he was anal or something. Believe me, he's tickled with what AG did. He was desperate to get the project done, and we did it for himon time and within budget. And made a bunch of money on the project. So we both came out winners." "In fact, I'll use old Jacob as a reference with the new customer we'll be meeting this afternoon to review their RFP. Customers always ask for references from previous projects, but quite frankly, they hardly ever call them."

"Hey, Gerri, you'll learn that you've got to focus on the next customer and not worry about the old ones. It works, believe me, or I wouldn't be driving this Porsche. Maybe they didn't teach you that in MBA school, Gerri, but I learned from the school of hard knocks when I took this business over from my father. He was well liked in the community, and I'm just following in his footsteps."

CASE QUESTIONS

1. What should Andy Gibson have done differently in his meeting with Jacob Clemson in Jacob's office?
2. What are some things Andy could have done differently in his initial contact with Jacob and during the project?
3. What are some things Jacob could have done differently from the time he met Andy Gibson initially and during the project?
4. What should Gerri do?