Sources of Ideas for New Projects and Products in a Manufacturing Company - Assignment Example

ENGINEERING MANAGEMENT By Lecturer Section A Question Sources of ideas for new projects and products in a manufacturing company Customers: the ultimate goal of any product or service is to satisfy customer needs and wants. When customers express a given need, such as a product to solve a given product, this gives a manufacturing company ideas for a new product or project. Competitors: every company strives to stay atop of the competition in a number of ways including quality, price and innovation. A manufacturing company can get ideas for a new project or product by having a look at a product from a competing company, which it might decide to improve. Employees: this is where a manufacturing company motivates its employees to be creative and innovative to come up with new ideas for new products and projects. The most likely source of new ideas in an R&D organisation is employees and customers. Question 2: Factors affecting the decision to go ahead with a project other than the benefit/cost ratio Important factors include environmental impact of the project, social impact of the project, availability of materials, labor availability and government requirements. Environmental and social impact of the project are important factors that result from sustainability analysis of the project, which evaluates whether the project will or will not be harmful to the environment and the society. Material and labor availability take a center stage because lack of these two crucial aspects of project completion means that the project is not technically possible even if it promises great results. Finally, government regulations, such as prohibition of certain projects in given areas determine the decision to go ahead with the project. Question 3: Quality in the benefit-cost equation The cost-benefit equation compares the costs and benefits of a given project with the aim of determining if the costs of the project outweigh its benefits. Non-monetary terms especially quality are usually included in the cost-benefit equation because quality has its costs and benefits. In other words, producing a high quality product has its costs, such as investing in high precision machines, time wastage in quality control and employing highly skilled workforce, and benefits, such as enabling the product to compete well in the market and reducing costs associated with removing defects (Dobes 2008). Several companies compete primarily on the basis of quality rather than price, and these companies have done extremely well in their respective markets. Some of them include JCB, a supplier of earthmoving equipment (JCB 2014), Mercedes (Mercedes 2014) and BMW (BMW 2014). Although products from these companies are expensive, customers like them because of their high quality. Question 4: components, decision points and chance events of a project I plan to start a small poultry farm. The components of the project are as follows: project initiation, plan development and project design, plan execution and construction work, project monitoring and control, and project completion. Decision points and chance events are as follows: Project initiation Do layers, broilers or none If I do layers cost will be higher than doing broilers, but returns after two years will be lower than doing broilers. If I do none, costs and profits will be zero, and the project will be terminated immediately. Plan development and project design Hire a person to design or design the house myself If I hire somebody do design, cost will be $500 extra but outcomes might be better than if I design the house. Design a house for layers or design a house for broilers If I design a house for broilers, cost will be lower by $400 than if I design house for layers Design single units or design storey units If I design single units, houses will take up more land than if I design storey units Plan execution and construction work Contract out the construction work or hire people to construct but manage the construction work myself Contracting will cost me $1000 extra compared to if I manage the work, but outcomes might be better than if I do the management. Project monitoring and control Hire a person to control quality or do the control myself Hiring a person will cost $300 extra but outcomes might be better than if I do quality control The final product will measure the success of the project, which will be a poultry house that fulfills all the requirements including proper aeration, lighting and heating. The ability to complete the construction work within the stipulated time (1.5 months) and within the budget will also measure project success. It is apparent that there is more than one measure of success, some of which might be antagonistic, such as cost and timely completion. To reconcile these three measures, performance criteria will be established that ranks these performance measures based on their relative importance and cost implication. Question 5: Management’s performance for an ongoing project The project under consideration is World Cup 2014 Preparations being done by the Brazilian Government. Currently, the project management is being criticised for running late on this project since the completion of the project will be some few days just before the start of the tournament (The Guardian 2014). Therefore, the management failed on time management and project planning and its performance can be rated at 60 out of 100. Proper time management and planning could help the project management to manage the project properly and finish the project in good time. Particularly, the project management should have outlined all the components of the project, determined the required time for each component and developed a plan to ensure that the entire project is completed several days before the start of the tournament. This would have ensured that there is ample time to correct any defect noticed after project completion. Question 6: life-cycle phases and activities in each phase The project under consideration is the poultry farm described in (4) above. Life-cycle phases and activities are as follows: Project initiation Performing market survey for product need Conducting research for house specification and requirements (material and government requirements) Surveying material availability Surveying availability of day old chicks Performing cost-benefit analysis Project planning Creating the project plan Creating the project budget Creating quality control plan Planning for procurement Sourcing for and contracting suppliers Project execution Procuring required materials Signing contracts with suppliers and contractors Constructing the house Controlling quality Controlling project cost Project closure Testing that all facilities are working Inspecting the entire poultry house Doing necessary adjustments Paying contractors (sealing the deal) Writing project report Question 8: reasons for project failure Example 1: Lake Turkana Fish Processing Plant in Kenya This project, which was funded by the government of Norway, was aimed at providing employment to the Turkana people hoping to end poverty in the region. However, the project ran for a few days and then shut down because Turkana people would not work in the plant or bring fish for processing, the reason being that they are nomads and do not like fishing (Kaijage & Nyagah 2009). Therefore, the main reason behind project failure was poor survey during project initiation. This resulted to the wrong project being pursued. Public consultation was not done (Kaijage & Nyagah 2009). Example 2: Lesotho Highlands Water Project This project was aimed at developing two countries, Lesotho and South Africa. Water from Lesotho Highlands would be sold to South Africa for electricity generation. However, electricity generated in South Africa became too expensive for consumers. Additionally, the project had serious environmental and economic consequences on people downstream (International Rivers 2014). It is apparent that this project failed due to poor or lack of proper analysis (environmental, economic and social). Again, poor or lack of cost-benefit analysis contributed to its failure. Section B Question 10 Question 11 Question 12 Calculations show that present value for machine L is £7881.9 while that of machine M is £9762.9. The cost of capital is 10%, which means that buying machine M will be more expensive than buying machine L. Therefore, machine L should be bought. Bibliography BMW 2014, BMW. [online] Retrieved from [Accessed April 4, 2014]. Dobes, L 2008, A Century of Australian Cost-Benefit Analysis: Lesson from the Past and the Present. Australian National University. International Rivers 2014, Lesotho Highlands Water Project: What Went Wrong? [online] Retrieved from [Accessed April 4, 2014]. JCB 2014, JCB. [online] Retrieved from [Accessed April 4, 2014]. Kaijage, AS. & Nyagah, MN 2009, Final Draft Report on Socio-Economic Analysis and Public Consultation of Lake Turkana Communities in Northern Kenya. African Development Bank Group. Mercedes 2014, Mercedes- Benz. [online] Retrieved from [Accessed April 4, 2014]. The Guardian 2014, Sepp Blatter Criticises Brazil Over World Cup 2014 Preparations. [online] retrieved from [Accessed April 4, 2014]. Read More