1. Primarily, the design team of Hydrosub is responsible for poor performance of Bolger Contract. Knowing the fact that every design changes will require renegotiations of contract and a lot of rework, the Hydrosub team should have frozen the design, right at the start of the project, with the collaboration of Bolger team. This way rework & renegotiation time & cost would have been saved. Also, the team at Bolger is also responsible for poor performance of the contract because of their huge inefficiency in handling cost data which hampered renegotiations. This has been highlighted by the fact that out of 4 weeks that is being asked for completion of AAV, 2 weeks are for contract negotiations only.
2. Frequent design change by the Hydrosub team & high inefficiency by Bolger team in handling cost data led to production delays & cost miscalculations.
3. Kathleen Johnson needs to take the following steps in order to ensure the project completion and prevent further problems:
He needs to call a joint meeting of Bolger team and Hydrosub design team, the outcome of which will be a final design for the prototype.
Amendment of contract, if possible, to remove the renegotiation clause.
Weekly review of project progress & cost impact together with Bolger team & Hydrosub team.
4. The Hydrosub’s staff should have done the following:
A firm budget for the project would have been declared instead of declaring zero concern for cost.
A minimum number of design changes by Hydrosub team should have been included in the contract. This way, the problem of renegotiating the contract for every design changes would have been done away with.
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