There are assumptions made during the planning process; however there remains a level of uncertainty
Angela Gaddie
There are assumptions made during the planning process; however there remains a level of uncertainty (Kloppenborg et, al., 2019). That uncertainty leads to times in which change is necessary based on the new information. A change control process exists to assign reviewers and approvers of the change proposals to ensure they are still within the limits and boundaries of the project including time and cost. ILS has instituted a form to be submitted in order to propose a change. It will include the submitter’s name, a brief description of the request, the impact on the timeline and budget, any associated risks, and must be approved by at least three of the project leaders on the team which are myself, John, Alice, Harriet, Harry, and Harvey.
This process is established proactively so that when a change arises, such as the one we have encountered today comes up, we have a starting point. Today, we returned from a meeting with Walmart who has informed us that they have partnered with Proctor & Gamble to pioneer the use of vendor managed inventory (VMI) which will enable us (ILS) to control the stocking and replenishment of products on their behalf (UACG, 2021). There are both opportunities and threats associated with this change as listed below.
Opportunities:
Stronger partnership with Walmart
Opportunity to gain Proctor & Gamble’s business
Increased revenue over time
Superior system to what is in place already, improves efficiency
Risks:
Increased cost with system set up, exceeding budget
Project deadline pushed out or tighten timeframes on existing initiatives to fit this
May need to use 2 systems concurrently as ILS supports companies other than Walmart
Additional training needed for employees
Lost time and revenue if ILS does not win Walmart’s business
Despite the risks, we do have a few things working in our favor. The fact that Walmart has brought us in on this conversation and planning reassures us that they are strongly considering our continued partnership. The budget I created left room for changes. $26,700 to be exact. Additionally, $18,000 was already earmarked for an inventory management system, so some or all of those funds can be allocated to this new system. The other constraint affected is time which I have also previously build in some wiggle room with the schedule. My project plan in Libre was very conservative since I dedicated a reasonable number of days to each activity. It is possible to run many of the deliverables concurrently which could accelerate the project, leaving time for the VMI integration. I also have a December 3rd project end date established, leaving almost 4 weeks of time that can be utilized to make room for the unknown unknowns like this VMI proposal.
Considering the subsequent project of bidding for Walmart’s business, we may need to negotiate with Walmart sooner if we are to spend funds to stand up a system and train employees on it. We would negotiate an intent to partner or actually ask for and earn the business prior to implementing the VMI. If we were to do this, then we would add training and SOP’s related to the VMI to the subsequent project. The ongoing discussions with Walmart need to be direct and forward moving to build confidence that the partnership will continue in the Philippines. Afterall, according to Kloppenborg et al. (2019), the “purpose of risk management is to reduce the overall project risk that is acceptable by the project sponsor and other key stakeholders”. The key phrase here is ‘overall project risk’. There is risk associated with not implementing the VMI. It could be more expensive not to implement since the system brings efficiencies that are not in place with the current system. It would also weaking ILS’s position if Walmart sees that we are hesitant to move forward with VMI, thus reducing our chance of a partnership. Therefore, the risk of not implementing VMI could result in much more than the $75,000 initial investment. This is what is meant by ‘overall risk’ – weighing all impacts. Ultimately, the project is still in a good place in terms of budget and time but is contingent on winning Walmart’s business, so there will be an even greater emphasis on securing that and gaining their commitment even earlier.
Resources
Kloppenborg, T. J., Anantatmula, V., & Wells, K. N. (2019). Contemporary project management (4th ed.). Cengage Learning.
UACG (2021). Week 3 – Discussion Forum 1. Proposal for New Project Requirements Role-Play
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