Case Study: Shell Case Fabricators

This assignment is a case study. You will be presented with information concerning a company facing a situation that requires at least one decision to be made. Read the case and using the course material and your additional research, write a short paper that briefly identifies the issues and proposes a solution that includes a justification for your choice.
This assignment considers the information provided in the Shell Case Fabricators (SCF) case. It can be found at the end of Chapter 12 of your text in the case section after the blue pages. Additional questions have been added, so please use the text only for the case material and not the assignment. To complete the assignment, follow the steps listed below:
Read the Shell Case Fabricators case at the end of Chapter 12.
Create a paper responding to the following questions (ignore the questions in the textbook and only answer these questions):
Consider the proposal. Should SCF accept or reject ACLs request? If you were the project manager, which option would you select? What risks are involved with your choice and with ACLs request?
How should SCF negotiate with ACL? How can SCF and ACL develop a positive, long-range relationship? Give specifics.
Would it be possible to outsource some of the project elements, and would it be ethical as this is already a subcontracted project? What other options are available that you could consider?
If you were to look for another solution, what would you include in your request for proposals (RFP)?
Write a three page paper in Word format. Use the American Psychological Association (APA) style (6th edition) for writing your assignment.
Compose your work in a .doc or .docx file type using a word processor (such as Microsoft Word, etc.) and save it frequently to your computer. For those assignments that are not written essays and require uploading images or PowerPoint slides, please follow uploading guidelines provided by your instructor.

Shell Case Fabricators

BACKGROUND

Shell Case Fabricators (SCF) designs and builds shell casings that enclose
electronic products such as calculators, cell phones, modems. Typically the cases
are plastic or plastic compounds. SCF has six different production lines that cover
different types of product. For example, the largest high volume production line
for modems can produce three different colors and two models (vertical and flat).
Air Connection Links (ACL) is the biggest customer that buys product from this
line. This high output line now runs at full capacity on an eight-hour shift. The
other five lines run smaller quantities and tend to meet the needs of other specialty
products manufactured by different smaller firms.
Ninety-five percent of SCFs product casings line is designed by the original
hardware manufacturer. Getting a casing to the production stage requires a great
deal of collaboration and interaction between the original hardware and case design
manufacturer (e.g., ACL) and SCFs shell design engineers and production
department. The latest new product of ACL is a modem designed to be used for
monitoring water activity in bays, e.g., ship traffic, pollution, floating debris. Because
of the products high functionality and low cost, potential demand for the
new product is out of sight. It seems every country with small bays used for shipping
wants enough underwater modems to cover their respective bays.
THE UNDERWATER MODEM PROJECT
At SCF each new product is assigned a project manager to coordinate and manage
the shell design, budgets, and manufacturing startup. Songsee is SCFs star project
manager and is the project manager of the shell for the new short-range,
underwater acoustical modem. The shell casing for the underwater modem
required special design, materials, custom equipment, and a seal to withstand
pressure to 50 meters. Air Connection Links, the product owner, needs sixty
thousand modems in 91 days (next January 15) for the Estuary Control Institute
meeting in Hong Kong.
CLIENT CHANGE REQUEST
Songsee has felt the project was moving along smoothly, with the exception of
being two weeks behind schedule. She feels she can lean on the design department
to put the project on top priority and make up the two weeks. Yesterday,
ACLs project manager, Sabin, came in with a simple change. Change the outer
shell shape from rectangular to dome shape; it will improve performance 2 percent.
Songsee couldnt believe Sabin. He knows better. He knows the engineering
implications, and it is NOT simple! Yet Sabin tells Songsee, It shouldnt cost
much. Songsee imagined a sharp retort, but she counted to five and aborted. At
this late stage of the game, changes and schedule compression cost big money!
Songsee said she would get together with her team and start on a new time and
cost estimate today. She told Sabin he would have to give her a written change request
of the new requirements by tomorrow. Sabin appeared disappointed. Why
dont we just add 100,000 to the price and get on with it? We have been doing
business with SCF for six years. With expected demand out of sight, SCF will
break even quickly and have a great profit on the production side. Songsee
sighed. Lets proceed with the change order process. I will bring your request to
the change order governance committee.
Songsees meeting with her team about the change went about as expected.
Every department moaned about changing at this late date. The guesstimate cost
and time estimates were over triple Sabins idea of 100,000. For example,
designing a new seal for a dome style modem will require a new custom water
sealing approach, possibly an untested different sealant, and new molds. Has ACL
frozen the design of the new style modem? Songsee asked the team to come in
with a more detailed estimate by tomorrow afternoon, before her meeting with the
change order governance committee.
THE NEXT DAY (FRIDAY)
Sabin called from ACL at midmorning the next day. Our senior management is
upset that we have to be so formal for such a small change. They just want to get
on with the project and meet the time to market launch date. 100,000 seems
like a fair price. They believe you need to talk to your management. They want a
response by Monday.
The team estimates came close to yesterdays guesstimate (391,000). Not good
news. Songsee knew the answer of the change committee would be to hold for the
full amount. She was right. The change committee believed the costs are there and
need to be covered to meet the launch date. The committee was also concerned
that priorities and resource scheduling would have to change for SCFs design and
production departments. In three hours she would meet with senior management
to decide to accept the clients request at their price or come up with an alternate
plan. Songsee realized she should have several options for senior management to
consider, along with a recommendation.

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