Corwin Corporation Case Analysis

Executive Summary

The purpose of this article is to explore the real reasons hidden behind the event of project termination between Corwin Corporation with the Peters Company. The decision of taking this project was made slapdash by Corwin Corporation just a few weeks before Charismas under the pressure of Peters Company. After three months, the project was finally cancelled just on the early testing stage by the client unilaterally. This project failure led to not only financial loss for Corwin, but also cessation of relations with Peters Company which is one of the most important and also a difficult customer.

Corwin as the synonymous with quality has stringent requirements for any project selection around product-based initiatives from outside client. However, under the pressure and the temptation of further undefined manufacturing contract from Peters, the requirements were completely neglected. The project failed to meet the client expectation due to lack of proper management at the pre-project and on-going phases. The major concerns of the failure include: project selection; staff competency; management support; project planning; and project communication between internal and external stakeholders.

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Introduction

This article is prepared to seek the reasons of Corwin Corporation’s project failure. Hunting mistakes that Corwin made during the project initiation and execution stages and provides recommendation and solutions in order to avoid the occurrence of similar cases. Corwin Corporation is a globally well-known high-quality rubber components manufacturer. The top management of Corwin is highly conservative and tends to exand markets for existing products rather than new product development.

Due to the high-quality products credibility, Corwin receives specialty products manufacturing frequently. By the conservation nature of Corwin’s management strategy, 90% of all specialty-product requires was rejected. However, this long standing internal protocols was totally breached and a high risky project was taken by Corwin from one of its existing customers-Peters Company in just a few days before Christmas.

The Peters Company is one of major client of Corwin. The good relationship has been built up through past 2 years ‘corporation begins from 1980 to 1982. At the end of 1982, Corwin received a request from Peters to produce a new product under a fixed $ 250,000 budget. During the initial conversation, Corwin resisted to accepting this project due to short notice time and unclear project scope. However, project was finally accepted for maintaining good client relationship and gaining further potential revenue of manufacturing contract.

Three months later, after a few conflicts this impetuous decision resulted in complete project failure and also cost Corwin’s relationship with Peters. There are quite a few reasons lead to this project failure. It includes project selection; project manager competency; managerial involvement, internal and external stakeholders’ communication. Hamburger argues that “in preparing an oversimplified, unrealistic project plan; in seeking commitments from a non-supportive management and an uncooperative functional organization; and in the false starts that result from working with an ineffective plan or no plan at all”(Hamburger, 1992) Discussion

Project selection

The first mistake was that Corwin Corporation should not take the risk to accept the work from Peters Company under such a short period of time and even without any clearly product specification. During the initial communication, Corwin Corporation is unwilling to accept this project from Peters Company but finally changed its mind after realizing for the upcoming financial incentives. The case happened just a few weeks before Christmas. Most management team members were away for their holiday. This was caused by a lack of project selection skills. As a result, without clearly understanding the uncertainties and project selection process will lead to project failure. Project selection is the very first step of the project life cycle and it is very important and foremost activity in project management(Jigeesh, 2012).

Bard, Balachandraand and Kaaufmann(1988) states that “project selection is a very complex decision-making process since it is affected by many critical factors such as technical success, government regulations, differing preferences among project selection parties, etc”. Most projects will not execute until an in-depth assessment of their probability of success is made, and the outcome appears favorable (Bard, 1988). In order to ensure the project selection is the most appropriate to business need. Baker (1986) argues that it needs to go through the pros and cons analysis and problem or opportunity need to be clearly identified at the early stage.

Staff competency

The project manager was appointed by Engineering VP. The Engineering director, project manager’s immediate boss, stated that the manager’s expertise was in managing internal rather than external projects. If he were the decision maker, he would not assign him to be the project manager. Unfortunately, Engineering VP took the risk and believed the director was too pessimistic to give him a try. The fact proved his assumption wrong. Anderson (1992) argues that once the inexperienced project manager was assigned to a new project. He or She tend to keep on the strength his or her technical expertise. Because the project manager may be attentive on technical details of the project, not focus on other aspects of the project. This could be a reason for project failure. (Thornberry, 1989)

Management support

During the early stage of this project, most of managerial team members were on vacation. The marketing VP who initiated the project then passed to Engineering VP just the day before he was leaving for his vacation. Due to the R&D director was also away Engineering VP directly selected one of the R&D scientists as the project manager without asking his opinion. Bird (1988) states that the support of top management is interrelated with project success. The management support can be defined as “When a senior management project sponsor/champion, the CEO and other senior managers devote time to review plans, follow up on results and facilitate management problems”(Young & Jordan, 2008).

The definition is interpreted to imply that project sponsor or management team members should spend more time on project activities and make enough time to be aware of the project status and to mediate as necessary. This is indicated that deficient management competencies or long distance remote leadership have negative impact on project outcomes(Blackstone, Cox, & Schleier, 2009). In this current case, most of management team members turn a blind eye to the project members and only engaged in blaming.

Project planning

In this example, the project team received a reluctant authorization to proceed from the CEO and then ball was passed from Marketing to Engineering team. The inexperienced Project manager was select by Engineering VP, not his direct leader. Also a contract man was assigned into the project team; he was totally unfamiliar with this kind of effort and just severed as a legal advisor once necessary. The Engineering director tried to argue that Peters Company was not easy to get along with and the project manager was very experienced in internal rather than external projects. Unfortunately his suggestion was left in the basket. Also during the first internal project meeting, the project manager was not in attendance at this meeting which was held with three vice presidents of Corwin Corporation. As Hamburger (1992) stated “ Time wasted in the false starts that result from working with ineffective plan or no plan at all”. The appropriate project kick-off effort will get the project heading in the right direction. Hamburger (1992) suggests that project kick-off should be organized in two ways.

Firstly, internal communication among project team members and planning the project effort. Secondly, external communication involves meeting the client to reach common understanding on the project requirement and conclude an agreement on operating methodology. Except above communication methods, a complete project hand-over is needed. The final project team needs to be aware of the right direction requirements of the client. Furthermore, a solid project team is crucial. It is important to build up a cohesive project team with a common purpose that each member can make towards project success. Finally, the initial client meeting is necessary and should be taken seriously. Preparation for the client meeting includes development of the working procedures that will be needed for effective daily interaction among project manager, project team members and clients.

Communication

As discussed above, whatever internal communication with team members or external communication with clients, communication is one of the crucial competency that manager should have. Henderson (2008) argues that to be a qualified project manager, the best resource loader or an effective influencer is not enough. A qualified project manager must be a capable communicator, should possess the competency to share information both in writing and verbally. The communication skill is the most important among other competencies(Knutson, 2001). During the early support soliciting stage, the line groups were upset because the project manager did not ask the help in advance. By the time the project manager completed the first three tests, the in-house representative complained the tests were completely opposite to the right direct. The project manager chose to cater to the in-house rather than report to senior management team. The inexperienced project manager also did not know to involve functional staff, assuming they would just come on board when he needed them.

The poor communication skills, combined with the in-house representative’s arrogant attitude along with his interference with the testing process, contribute to unpleasant working environment and also reduced the work morale of project team members. Krahn and Hartment (2006) found that listening and verbal communication were most critical competencies among other competences for project managers to be successful in nowadays organizational environments.

All these problems arise because the inexperienced project manager did not notice the communication breakdown escalated during project execution. There are several communication action principles would be important for an efficient project management. Firstly, ensuring participation is in decision making by consulting all decisional factors. Secondly, the internal communication should be top priority and also a balance between internal and external communication must be taken into account. Finally, communication will not be a mere data transmission but also an exchange of information, idea and opinions (Posea, 2012).

Conclusions

1. The hasty decision was a mistake fundamentally. Corwin Corporation did not take enough time to analyze the project specifications, pros and cons adequately. 2. The original project selection process was totally ignored. 3. The project team was built up with inexperience project members. This mistake leaded to communication breakdown with internal and external stakeholders and deficiencies in product examinations. 4. The inexperience technical talent was appointed to be the project manager. 5. The management team did not fully involve in this project. 6. The internal and external communication channels are blocked leading to misinterpretation of data, blindness among stakeholders. 7. Took the risk to accept the project from an existing client. Moreover, it had been aware Peters Company was difficult to deal with.

Recommendations

1. Issue a rigorous company policy in project and project manager selection process. 2. Reinforce existing project selection process. Do not make any unwise decision unless it successfully passed the selection process. 3. Set up a train program on stakeholders’ communication. 4. School relevant employees about the project scope, project selection, pre-project planning and other project management relation train programmes. 5. Create project manager selection strategies to improve the managerial skills and administrative capabilities of project managers. 6. It is the responsibility of the managerial team to support project staff not only on project itself but also includes member’s feeling. 7. Set up a team to restore the relationship with Peters Company. 8. Build up internal and external communication protocols.

Reference:

Anderson, S. D. (1992). Project quality and project managers. International Journal of Project Management, 10(3), 138–144. Bard, J. B., R.; Kaufmann, P. E. (1988). An interactive approach to R&D project selection and termination. IEEE Transactions on Engineering Management, 35, 139–146. Blackstone, J. H., Cox, J. F., & Schleier, J. G. (2009). A tutorial on project management from a theory of constraints perspective. International Journal of Production Research, 47(24), 7029–. Hamburger, D. (1992). Project kick-off: Getting the project off on the right foot. International Journal of Project Management, 10(2), 115–122. Henderson, L. S. (2008). The impact of project managers' communication competencies: validation and extension of a research model for virtuality, satisfaction, and productivity on project teams. Project Management Journal, 39(2), 48–59. Jigeesh, N. (2012). Selection of project as important beginning for information technology project management. IUP Journal of Operations Management, 11(1), 42–49. Knutson, J. (2001). Succeeding in project-driven organizations:people processes, and politics. New York: Wiley. Posea, C. (2012). Communication implied by the project management. Scientific Research & Education in the Air Force, 197–203. Thornberry, N. E. (1989). Transforming the engineer into a manager: avoiding the Peter Principle. Civil Eng. Pract. Young, R., & Jordan, E. (2008). Top management support: mantra or necessity? International Journal of Project Management, 26(7), 713–725.