Macon Inc. was a 50-year-old company in the business of developing test equipment for the tyre industry. The company had a history of segregated departments with focused functional line managers. The company had two major technical departments: mechanical engineering and electrical engineering. Both departments reported to a long-serving Vice President for engineering, whose background was mechanical engineering. For this reason, the company undertook all projects from a mechanical engineering perspective. The significance of the test equipment's electrical control system was often minimized when, in reality, the electrical (not the mechanical) control systems were what made Macon's equipment outperform that of the competition.

Because the two technical departments operated in a highly autonomous way, there was much internal competition between them. Line managers from each department frequently competed with one another rather than focusing on the best interests of Macon Inc.. Each would hope the other would be the cause for project delays instead of working together to avoid project delays altogether. Once dates slipped, fingers were pointed, blame assigned and the problem would worsen over time.

One of the company's customers had a service department that always blamed Macon Inc.'s engineering for all of their problems. If the machine was not assembled correctly, it was engineering's fault for not documenting it clearly enough. If a component failed, it was engineering's fault for not designing it correctly. No matter what problem occurred in the field, customer service would always put the blame on Macon Inc.'s engineering.

As might be expected, engineering would blame most problems on production claiming that production did not assemble the equipment correctly and did not maintain the proper level of quality. Engineering would design a product and then push it on to production without ever going down to the manufacturing floor to help with its assembly. Errors or suggestions reported from production to engineering were being ignored. Engineers often perceived the assemblers as incapable of improving the design.

Production ultimately assembled the product and shipped it out to the customer. Often times during assembly the production people would change the design as they saw fit without involving engineering. This would cause severe problems with documentation. Customer service would later inform engineering that the documentation was incorrect, once again causing conflict among all departments.

The President of Macon Inc. was a strong believer in project management. Unfortunately, his preaching fell upon deaf ears. The culture was just too strong. Projects were failing miserably. Some failures were attributed to the lack of sponsorship or commitment from line managers. One project failed as the result of a project leader who failed to control scope. Each day the project would fall further behind because work was being added with very little regard for the project's completion date. Project estimates were based upon a "gut feel" or intuition rather than upon sound quantitative data.

The delay in shipping dates was creating more and more frustration for the customers. The customers began assigning their own project managers as "watchdogs" to look out for their companies' best interests. The primary function of these "watchdog" project managers was to ensure that the equipment purchased from Macon Inc. would be delivered on time and complete. This involvement by the customers was becoming more prominent than ever before.

The President decided that action was needed to achieve some degree of excellence in project management. The question was what action to take.

Questions:

1. Identify and analyse the main Project Management Issues (both organizational and management) at Macon Inc. Draw upon your knowledge of the Project management Body of Knowledge (PMBoK) to help you analyse the case. Do NOT simply re-state the case facts.

2. Prepare a report card on Macon about the problems they are facing in applying project management principles to their projects. Select a set of specific project management factors against which you will measure their performance in new product development projects. Rate Macon Inc. against these factors explaining why you gave them this rating based on the evidence presented in the case and your knowledge of best practice principles of Project Management.

3. You have been hired by the President to advise him/her on how to help Macon achieve project management excellence. What recommendations will you make to him/her based on your rating in question 2 of this case study? Write out a brief scope statement for a consultancy project that you are planning to propose to the President to help Macon Inc. achieve project management excellence. You need to justify your scope recommendations.