Advantages and Disadvantage Funtonal, Matrix and Dedicated in Organizational Structures

750 Words May 27th, 2013 3 Pages
ASSIGNMENT – EMPM5103

MAY SEMESTER 2013 EMPM5103 – PRINCIPLES OF PROJECT MANAGEMENT ASSIGNMENT

OBJECTIVE: The assignment is intended to provide you the opportunity to evaluate and discuss critically three different principles of project management under the following tasks : Task 1 Task 2 Task 3 Organisation Structure Risk Management Project Planning

The details of the tasks are explained below:

TASK 1: ORGANISATION STRUCTURE

Question Discuss the relative advantages and disadvantages of the functional, matrix, and dedicated team approaches to managing projects. [20 marks]

TASK 2: PROJECT RISK MANAGEMENT

GiGi Incorporated The rapid growth of the telecommunications industry has made it apparent that executives at GiGi Incorporated
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Accordingly, management budgeted $650,000 for the purchasing and handling of 10,000 components plus scrap. During the design stage, your engineering team informs you that the final design will require a somewhat higher grade component that sells for $72 with quantity discounts. The new price is substantially higher than you had budgeted for. This will create a cost overrun.

2

ASSIGNMENT – EMPM5103

You meet with your manufacturing team to see if they can manufacture the component at a cheaper price than buying it from outside. Your manufacturing team informs you that they can produce a maximum of 10,000 units, just enough to fulfill your contract. The setup cost will be $100,000 and the raw material cost is $40 per component. Since Telo has never manufactured this product before, manufacturing expects the following defects: % Defective % Probability of occurrence 0 10 20 10 30 20 25 30 15 40

All defective parts must be removed and repaired at a cost of $120 per part. Questions a. b. Using expected value, is it economically better to make or buy the component? Strategically thinking, why might management opt for other than the most economical choice? [20 marks] TELO ENGINEERING (B) Your manufacturing team informs you that they have found a way to increase the size of the manufacturing run from 10,000 to 18,000 units, in increments of 2,000 units. However, the setup cost will be $150,000 and

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