Strategic Redirection

Ford Motor Company stated that the selection of the chunk managers would not take place for another year. Unfortunately, Como's plan to achieve excellence would not have been completed by then and its chances to be awarded a chunk management slot were slim.

The automotive division of Como was now at a critical junction. Como's management believed that the company could survive as a low-level supplier of parts, but its growth potential would be questionable. Chunk managers might find it cost-effective to become vertically integrated and produce for themselves the same components that Como manufactured. This could have devastating results for Como. This alternative was unacceptable.

The second alternative required that Como make it clear to Ford Motor Company that Como wished to be considered for a chunk manager contract. If Como were to be selected, then Como's project management systems would have to:

• Provide greater coordination activities than previously anticipated

• Integrate concurrent engineering practices into the company's existing methodology for project management

• Decentralize the organization so as to enhance the working relationship with the customers

• Plan for better resource allocation so as to achieve a higher level of efficiency

• Force proactive planning and decision-making

• Drive out waste and lower cost while improving on-time delivery

There were also serious risks if Como were to become a chunk manager. The company would be under substantially more pressure to meet cost and delivery targets. Most of its resources would have to be committed to complex coordination activities rather than new product development. Therefore, value-added activities for its customers would be diminished. Finally, if Como failed to live up to its customers' expectations as a chunk manager, it might end up losing all automotive work.

The decision was made to inform Ford of Como's interest in chunk management. Now Como realized that its original three-year plan for excellence in project management would have to be completed in 18 months. The question on everyone's mind was: "How?"

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