The Communications Breakdown

During the week following the design review meeting Gary planned to make the first verification mix in order to establish final specifications for selection of the raw materials. Unfortunately, the manufacturing plans were a week behind schedule, primarily because of Gary, since he had decided to reduce costs by accepting the responsibility for developing the bill of materials himself.

A meeting was called by Gary to consider rescheduling of the mix.

Anderson: As you know we're about a week to ten days behind schedule. We'll have to reschedule the verification mix for late next week.

Production Manager: Our resources are committed until a month from now. You can't expect to simply call a meeting and have everything reshuffled for the Blue Spider Program. We should have been notified earlier. Engineering has the responsibility for preparing the bill of materials. Why aren't they ready?

Engineering Integration: We were never asked to prepare the bill of materials. But I'm sure that we could get it out if we work our people overtime for the next two days.

Anderson: When can we remake the mix?

Production Manager: We have to redo at least 500 sheets of paper every time we reschedule mixes. Not only that, we have to reschedule people on all three shifts. If we are to reschedule your mix, it will have to be performed on overtime. That's going to increase your costs. If that's agreeable with you, we'll try it. But this will be the first and last time that production will bail you out. There are procedures that have to be followed.

Testing Engineer: I've been coming to these meetings since we kicked off this program. I think I speak for the entire engineering division when I say that the role that the director of engineering is playing in this program is suppressing individuality among our highly competent personnel. In new projects, especially those involving R&D, our people are not apt to stick their necks out. Now our people are becoming ostriches. If they're impeded from contributing, even in their own slight way, then you'll probably lose them before the project gets completed. Right now I feel that I'm wasting my time here. All I need are minutes of the team meetings and I'll be happy. Then I won't have to come to these pretend meetings anymore.

The purpose of the verification mix was to make a full-scale production run of the material to verify that there would be no material property changes in scale-up from the small mixes made in the R&D laboratories. After testing, it became obvious that the wrong lots of raw materials were used in the production verification mix.

A meeting was called by Lord Industries for an explanation of why the mistake had occurred and what the alternatives were.

Lord: Why did the problem occur?

Anderson: Well, we had a problem with the bill of materials. The result was that the mix had to be made on overtime. And when you work people on overtime, you have to be willing to accept mistakes as being a way of life. The energy cycles of our people are slow during the overtime hours.

Lord: The ultimate responsibility has to be with you, the program manager. We, at

Lord, think that you're spending too much time doing and not enough time managing. As the prime contractor, we have a hell of a lot more at stake than you do. From now on we want documented weekly technical interchange meetings and closer interaction by our quality control section with yours.

Anderson: These additional team meetings are going to tie up our key people. I can't spare people to prepare handouts for weekly meetings with your people.

Lord: Team meetings are a management responsibility. If Parks does not want the Blue Spider Program, I'm sure we can find another subcontractor. All you (Gary) have to do is give up taking the material vendors to lunch and you'll have plenty of time for handout preparation.

Gary left the meeting feeling as though he had just gotten raked over the coals. For the next two months, Gary worked sixteen hours a day, almost every day. Gary did not want to burden his staff with the responsibility of the handouts, so he began preparing them himself. He could have hired additional staff, but with such a tight budget, and having to remake verification mix, cost overruns appeared inevitable.

As the end of the seventh month approached, Gary was feeling pressure from within Parks Corporation. The decision-making process appeared to be slowing down and Gary found it more and more difficult to motivate his people. In fact, the grapevine was referring to the Blue Spider Project as a loser, and some of his key people acted as though they were on a sinking ship.

By the time the eighth month rolled around, the budget had nearly been expended. Gary was tired of doing everything himself. "Perhaps I should have stayed an engineer," thought Gary. Elliot Grey and Gary Anderson had a meeting to see what could be salvaged. Grey agreed to get Gary additional corporate funding to complete the project. "But performance must be met, since there is a lot riding on the Blue Spider Project," asserted Grey. He called a team meeting to identify the program status.

Anderson: It's time to map out our strategy for the remainder of the program. Can engineering and production adhere to the schedule that I have laid out before you?

Team Member: Engineering: This is the first time that I've seen this schedule. You can't expect me to make a decision in the next ten minutes and commit the resources of my department. We're getting a little unhappy being kept in the dark until the last minute. What happened to effective planning?

Anderson: We still have effective planning. We must adhere to the original schedule, or at least try to adhere to it. This revised schedule will do that.

Team Member: Engineering: Look, Gary! When a project gets in trouble it is usually the functional departments that come to the rescue. But if we're kept in the dark, then how can you expect us to come to your rescue? My boss wants to know, well in advance, every decision that you're contemplating with regard to our departmental resources. Right now, we . . .

Anderson: Granted, we may have had a communications problem. But now we're in trouble and have to unite forces. What is your impression as to whether your department can meet the new schedule?

Team Member: Engineering: When the Blue Spider Program first got in trouble, my boss exercised his authority to make all departmental decisions regarding the program himself. I'm just a puppet. I have to check with him on everything.

Team Member: Production: I'm in the same boat, Gary. You know we're not happy having to reschedule our facilities and people. We went through this once before. I also have to check with my boss before giving you an answer about the new schedule.

The following week the verification mix was made. Testing proceeded according to the revised schedule, and it looked as though the total schedule milestones could be met, provided that specifications could be adhered to.

Because of the revised schedule, some of the testing had to be performed on holidays. Gary wasn't pleased with asking people to work on Sundays and holidays, but he had no choice, since the test matrix called for testing to be accomplished at specific times after end-of-mix.

A team meeting was called on Wednesday to resolve the problem of who would work on the holiday, which would occur on Friday, as well as staffing Saturday and Sunday. During the team meeting Gary became quite disappointed. Phil Rodgers, who had been Gary's test engineer since the project started, was assigned to a new project that the grapevine called Gable's new adventure. His replacement was a relatively new man, only eight months with the company. For an hour and a half, the team members argued about the little problems and continually avoided the major question, stating that they would first have to coordinate commitments with their bosses. It was obvious to Gary that his team members were afraid to make major decisions and therefore "ate up" a lot of time on trivial problems.

On the following day, Thursday, Gary went to see the department manager responsible for testing, in hopes that he could use Phil Rodgers this weekend.

Department Manager: I have specific instructions from the boss (director of engineering) to use Phil Rodgers on the new project. You'll have to see the boss if you want him back

Anderson: But we have testing that must be accomplished this weekend. Where's the new man you assigned yesterday?

Department Manager: Nobody told me you had testing scheduled for this weekend. Half of my department is already on an extended weekend vacation, including Phil Rodgers and the new man. How come I'm always the last to know when we have a problem?

Anderson: The customer is flying down his best people to observe this weekend's tests. It's too late to change anything. You and I can do the testing.

Department Manager: Not on your life. I'm staying as far away as possible from the Blue Spider Project. I'll get you someone, but it won't be me. That's for sure!

The weekend's testing went according to schedule. The raw data was made available to the customer under the stipulation that the final company position would be announced at the end of the next month, after the functional departments had a chance to analyze it.

Final testing was completed during the second week of the ninth month. The initial results looked excellent. The materials were within contract specifications, and al though they were new, both Gary and Lord's management felt that there would be little difficulty in convincing the Army that this was the way to go. Henry Gable visited Gary and congratulated him on a job well done.

All that now remained was the making of four additional full-scale verification mixes in order to determine how much deviation there would be in material properties between full-sized production-run mixes. Gary tried to get the customer to concur (as part of the original trade-off analysis) that two of the four production runs could be deleted. Lord's management refused, insisting that contractual requirements must be met at the expense of the contractor.

The following week, Elliot Grey called Gary in for an emergency meeting concerning expenditures to date.

Elliot Grey: Gary, I just received a copy of the financial planning report for last quarter in which you stated that both the cost and performance of the Blue Spider Project were 75 percent complete. I don't think you realize what you've done. The target profit on the program was $200,000. Your memo authorized the vice president and general manager to book 75 percent of that, or $150,000, for corporate profit spending for stockholders. I was planning on using all $200,000 together with the additional $300,000 I personally requested from corporate headquarters to bail you out. Now I have to go back to the vice president and general manager and tell them that we've made a mistake and that we'll need an additional $150,000.

Anderson: Perhaps I should go with you and explain my error. Obviously, I take all responsibility.

Grey: No, Gary. It's our error, not yours. I really don't think you want to be around the general manager when he sees red at the bottom of the page. It takes an act of God to get money back once corporate books it as profit. Perhaps you should reconsider project engineering as a career instead of program management. Your performance hasn't exactly been sparkling, you know.

Gary returned to his office quite disappointed. No matter how hard he worked, the bureaucratic red tape of project management seemed always to do him in. But late that afternoon, Gary's disposition improved. Lord Industries called to say that, after consultation with the Army, Parks Corporation would be awarded a sole-source contract for qualification and production of Spartan missile components using the new longer-life raw materials. Both Lord and the Army felt that the sole-source contract was justified, provided that continued testing showed the same results, since Parks Corporation had all of the technical experience with the new materials.

Gary received a letter of congratulations from corporate headquarters, but no additional pay increase. The grapevine said that a substantial bonus was given to the director of engineering.

During the tenth month, results were coming back from the accelerated aging tests performed on the new materials. The results indicated that although the new materials would meet specifications, the age life would probably be less than five years. These numbers came as a shock to Gary. Gary and Paul Evans had a conference to determine the best strategy to follow.

Anderson: Well, I guess we're now in the fire instead of the frying pan. Obviously, we can't tell Lord Industries about these tests. We ran them on our own. Could the results be wrong?

Evans: Sure, but I doubt it. There's always margin for error when you perform accelerated aging tests on new materials. There can be reactions taking place that we know nothing about. Furthermore, the accelerated aging tests may not even correlate well with actual aging. We must form a company position on this as soon as possible.

Anderson: I'm not going to tell anyone about this, especially Henry Gable. You and I will handle this. It will be my throat if word of this leaks out. Let's wait until we have the production contract in hand.

Evans: That's dangerous. This has to be a company position, not a project office position. We had better let them know upstairs.

Anderson: I can't do that. I'll take all responsibility. Are you with me on this?

Evans: I'll go along. I'm sure I can find employment elsewhere when we open Pandora's box. You had better tell the department managers to be quiet also.

Two weeks later, as the program was winding down into the testing for the final verification mix and final report development, Gary received an urgent phone call asking him to report immediately to Henry Gable's office.

Gable: When this project is over, you're through. You'll never hack it as a program manager, or possibly a good project engineer. We can't run projects around here without honesty and open communications. How the hell do you expect top management to support you when you start censoring bad news to the top? I don't like surprises. I like to get the bad news from the program manager and project engineers, not secondhand from the customer. And of course, we cannot forget the cost overrun. Why didn't you take some precautionary measures?

Anderson: How could I when you were asking our people to do work such as accelerated aging tests that would be charged to my project and was not part of program plan? I don't think I'm totally to blame for what's happened.

Gable: Gary, I don't think it's necessary to argue the point any further. I'm willing to give you back your old job, in engineering. I hope you didn't lose too many friends while working in program management. Finish up final testing and the program report. Then I'll reassign you.

Gary returned to his office and put his feet up on the desk. "Well," thought Gary, "perhaps I'm better off in engineering. At least I can see my wife and kids once in a while." As Gary began writing the final report, the phone rang:

Functional Manager: Hello, Gary. I just thought I'd call to find out what charge number you want us to use for experimenting with this new procedure to determine accelerated age life.

Anderson: Don't call me! Call Gable. After all, the Blue Spider Project is his baby.

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