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Case Study Assignment #2

Overview
Your assignment is to analyze the Buildco Industry case study. You should analyze the
business issue outlined in the case using the analytical tools we have developed in this
course. There is no template for this assignment. Organize your work into a report of 4-6
pages. The report should be a well organized, well written, business style document.
You may work in groups on this assignment and if you do you may turn in a single paper
with multiple names. If done as a group project the quality of the paper should reflect the
number of contributors (i.e. multiple contributors should lead to a better paper.) The team
is responsible for making sure everyone contributes fairly to the final deliverable.

Case Analysis
For this assignment you are to analyze the Buildco Case. Write up the report that Gary
was asked to prepare. Make sure your report provides an unambiguous recommendation
and a clear rationale for that recommendation. Be sure to consider the issues about report
writing we discussed in class.

OMGT 3223

Case 2

Buildco Industries, LLC


Developing an Estimate
Gary left the conference room feeling a bit uneasy. His new boss Michele had just given
him his first assignment and he was nervous about his ability to meet her expectations.
Michele had just been hired as Buildcos new Chief Information Officer (CIO). Alan,
Buildcos previous CIO, had been dismissed last week due to repeated delays in the rollout of the companys new distribution management system. It seemed that Buildcos new
owners were a little more demanding than the previous management.
Michele had been brought in to take over the project and get the system finished.
Michele was a 35-year-old, take charge type of manager. After earning an MBA from
Carnegie Mellon she had spent 10 years working in for a large management consulting
firm. Early in her career Michele had been a top-notch quantitative analysis but over the
past few years had become more focused on management activities. Michele still
considered herself to be a highly analytical, by the numbers type manager.
Michele had asked Gary to put together an estimate of the completion time for the project
under its current structure, but she was asking for details Gary didnt really understand.
He was worried that if he didnt figure it out hed soon be looking for a new job like
Alan.

Buildcos History
Buildco had been found in 1985 by Joe Jones. Buildco started out as a plumbing
distributor to the mobile home manufacturing industry. Joe worked the relationships with
home builders aggressively and steadily grew the business. Along the way he expanded
the business by buying out other distributors who served the same industry. By the late
1990s Buildco had expanded their product line to include building materials, hardware,
and electrical products.
Joe was always focused on sales, not operations, and the acquired companies tended to
operate independently. They had multiple warehouses and multiple information systems
for each product line. When times got tight in the early 2000s Joe hired a Chief
Operating Officer to consolidate Buildcos warehouses so that all products would be
stocked in the same facilities. The physical consolidation was a big success but the effort
to standardize on a single information system never got completed. Alan had led a team
that tried to develop a new system to support the entire business line, but after 2 years of
effort with little results that project was shut down.
About a year ago Joe made his final sale, he sold the entire business to Windswept
Partners, a private equity fund. They purchased Buildco with the intent of improving
productivity, boosting profitability and taking the company public for a big profit.

OMGT 3223

Case 2

The Distribution System Project 2.0


Windswept Partners did an operational audit immediately after taking control of Buildco
and determined that a new information system was indeed required if they were going to
achieve the required level of productivity gains. They authorized Alan to move forward
with a new system project but this time insisted that they proceed with commercial off the
shelf software instead of a custom development effort. Alan and his team identified a
number of vendors and began conducting a detailed due diligence process. Over a 6month period the team narrowed the original six candidate solutions down to two. They
began developing detailed design specifications for each product so that they could
provide a detailed cost comparison of the two products.
It was at this point that Windswept management grew frustrated with the slow progress of
the project. Jim Johns, the Windswept partner in charge, quietly recruited Michele to take
over the IT department. On a Friday afternoon Jim announced to the company that Alan
was stepping down to pursue other opportunities and that Michele was taking over. On
Monday Michele held an initial staff meeting with the key members of the project team.
She announced that the period of indecision was over and that no one was leaving the
meeting until a software product was selected. After a tense 6 hour meeting the team
decided that would move forward with the Wizcom solution. Her next objective was to
set an implementation date that would be met no matter what.
Alan and his team had done much of the design work and come up with a high level
project plan. The project plan had 3 steps which could all start immediately and run in
parallel. Each task had a dedicated team assigned.

Package Configuration: this team would set up all the parameters and business
rules in the package.
Custom Modifications: this team would write custom code for a pricing function
that the core package could not handle.
Data Conversion: this team would develop a set of programs to convert all of
Buildcos data into the new system.

Only after each of these tasks was completed, could the final task of System Testing
begin. Each of the teams would work together with the user testing team to make sure
that the package was ready to go. Once the users signed off the package would be
implemented.

OMGT 3223

Case 2

Setting the Go Live Date


Gary had been assigned by Alan to be the overall project manager for this effort and it
was his responsibility to give Michele a go live date. Gary met with the project managers
of each of the teams. He asked them to come up with a best case, worst case, and most
likely estimate for how many business days they needed to complete their assignments.
The data he collected is summarized below:

Gary went to Michele for the meeting. Gary told her that since she wanted to be sure that
the date would be met that the team would need 220 days. He argued that in the worst
case data conversion would take 100 days, and system testing would take another 120
days; hence the 220-day estimate.
Michele did not take this news well. She told him that the team was being far too
conservative. While she accepted the teams individual estimates she felt that Gary was
being too conservative by assuming the worst case for everything. She told him to come
with a more realistic assessment, one that was 90% sure would be met. Apply some
rigorous analysis, she said, and I think youll find that the 90% level is a lot less than
220 days. If we take the most likely estimates, we get it done in 115 days. Ill give them
a little extra time to be safe, lets say 125 days. Then she added, You need to come see
me tomorrow with an analysis that shows what due dates are possible given these
assumptions. I want to know specifically what the probability is we can make 125 days
with our current resources before I make a commitment to Jim. I also want to know
where I should think about adding additional resources.