Tegan And Hrad Technika - Case Study Example

Teacher: Table of Contents Table of Contents Tegan and Hrad Technika: A Case Study 2 Introduction 2 Outsourcing the A/P Project and Challenges 2 Tradeoffs Involved 3 Choice of Development Methodology 4 Problems with the Commencement of Project 4 IT Management Failures 5 Recommendable Options 6 Conclusion 7 Works Cited 8 Tegan and Hrad Technika: A Case Study Introduction Tegan was a well-established firm of toys and was regarded among the most reputed firms while Hrad Technika was also a well-formed company of project development. Tegan faced problems in handling it’s Accounts Payable system (A/P system) due to which, it thought of outsourcing the A/P system to a third party. This third party was Hrad Technika, which already completed several projects for Tegan. However, these projects were of meager nature while outsourcing of A/P project was a major project with much complexity. The company faced many challenges and problems in the outsourcing procedure. The project was assigned to Hrad with a fixed deadline and cost and this deadline and cost was not enough for the completion of the project. There were several problems due to which, Hrad was unable to meet the deadline. This paper deals with the case between Tegan and Hrad Technika in detail. Outsourcing the A/P Project and Challenges A/P was experiencing problems and Tegan was continuously thinking about dealing with the problems with A/P system but Tegan was unable to sort out the issue until Fan Li came with his toys in the market. Tegan had three options out of which, it had to decide for an appropriate project suitable for the performance and maintenance of A/P project. The first option was to install an enterprise resource planning system such as SAP, second was to rewrite the system using internal resources and third was to outsource the system development to a third party (Upton and Staats 2008b, 3). The organization’s management decided for the third option that was to outsource the A/P project and the reasons were that they were unable to bear the costs of other projects and they did not have the required staff for the development process. The outsourcing of A/P project was the right move in comparison to the other alternatives because it required minimum cost that was bearable for the firm and also the other options required more costs and more staff for the work. Hrad Technika worked for Tegan before for completing software programs for the firm. However, this task was much challenging for the company and required much expertise. Previously the projects go through problems but the administration of Tegan was satisfied with Hrad Technika due to which, they opted for it. Tradeoffs Involved Requirements analysis is very crucial for successful bidding on any project. With the help of requirement analysis, all the requirements and demands of the system can be known and all the problems that the system is facing by the users of the system can be known. In addition, the costs that are placed in form of bid are appropriate as all the work in relation to cost analysis is done along with requirements analysis. The tradeoffs of the requirements analysis can be the ultimately the assigning of the project and the bidding company also gets the project setting aside the other companies. Hrad Technika because of requirements analysis knew better about the problems faced by the A/P system because of their analysis strategy. Choice of Development Methodology After getting the project of outsourcing of A/P system of Tegan, Hrad Technika took several steps. Tegan wanted an urgent solution of the problem of A/P system due to which, Hrad Technika decided to update the Dunnock system. Dunnock system was the old form of A/P system and because of continuous transformations, Dunnock changed into A/P system. The choice of development methodology comprised of provision of an updated version of Dunnock to make the management get something urgently. Afterwards, Hrad Technika was held responsible for creating a requirements document for the system. Hrad adopted formal work breakdown methodology. For the execution of the project, Hrad partnered with Dunnock. The workers from Tegan were also to be employed for the task of development. The persons who gained more expertise or who were more knowledgeable about the system were required for the development of the system. Problems with the Commencement of Project Hrad Technika performed a requirements analysis for the project to find out the exact requirements of the system but when they started to work on the system, it was found out that the system was much more complex than perceived (Upton and Staats 2008a, 3). This problem raised when Hrad identified that A/P system is a transformed version of Dunnock, an older version and with the passage of time, many internal customizations can be noticed in the Dunnock system (Upton and Staats 2008a, 3). Due to this factor, there were scope and requirements problems of the system for Hrad. In addition, when the project commenced in actuality, only one person was provided to review the documents created by Hrad Technika, which was a problem for the company. Tegan was facing problems in terms of availability of experienced and knowledgeable people about the system due to which, the project faced handling problems. Later on, Hrad asked for time extension for the project deliverance because of many hindrances in between. This was considered a very lethal step as the price along with deadline was fixed beforehand. IT Management Failures IT management failures can be seen here as the management of Tegan as well as of Hrad was not fully aware of the risks involved in the project development. The risk analysis factor and task were not given importance due to which, Hrad was unable to deliver the project within the deadline. As far as Tegan is concerned, the management of Tegan only showed interest in the costs involved in the project but they do not give any heed to the fact that the persons having IT knowledge and especially the knowledge about the A/P system were less and were required for the outsourcing of the A/P project. The management shifted a person from finance department to the process of project development that had little or no knowledge of the outsourcing of software program. This fact cannot be negated that there were leadership and commitment failures as leaderships problems were there with the Tegan while there were commitment problems with the Hrad Technika. The risks were not analyzed before due to which, when there were problems, both the work partners faced problematic situation. The project was not to be delivered as promised and costs that were fixed before were becoming higher because the expenditure along with risky expenses were not previously considered. IT was an important consideration for Tegan. The system run by Tegan previously had Dunnock but with the passage of time, internal customizations were there due to which, the system became quite complex and also the system turned into A/P system, which was again creating problems for Tegan. These problems were not previously dealt in detail but after arrival of Fan Li, Tegan considered it essential to pay heed to A/P system. In addition, Tegan had inadequate staff members that had good awareness and knowledge of the A/P system that was also an IT concern for the company. Recommendable Options The options recommended were two and these options were provided to Tegan for consideration. First was to extend the time required for the project completion or to go beyond the deadline for the project’s completion while the second one was to reduce the functionality required by the system. Also in order to meet the deadline, the project required an additional 400,000 pounds that were not previously settled or fixed. The additional costs were regarded a breakage of commitment by Tegan and was considered awful. However, this issue was to be solved by going for any one option suitable for the company. As far as additional costs and less functionality is concerned, it is not a good option as with more cost, the new system will not be able to fulfill all the requirements of the users. However, with the increased deadline, all the functionality with the previously settled costs will be met. Therefore, according to my consideration, the first option is more convenient because the company is in no position to pay additional costs for the project. Conclusion Both the companies, Tegan and Hrad Technika are quite reputable and enjoy good name. Tegan wanted to deal with the problems with its A/P system due to which, Hrad was involved in the outsourcing of A/P system. Previously, it was settled that the project will be done within a fixed price and will meet the deadline. However, with the passage of time, problems were identified due to which, the project got late and extra time was required. The management faced problems because of not identifying certain risky situations. Works Cited Upton, David M. and Staats, Bradley R. Hrad Technika. Boston: Harvard Business School Publishing, 2008a: 1-5. Upton, David M. and Staats, Bradley R. Tegan. Boston: Harvard Business School Publishing, 2008b: 1-5. Read More