Pert Mustang Restoration Case Study

3315 words (13 pages) Business Assignment

23rd Sep 2020 Business Assignment Reference this

Tags: Business AssignmentsProject Management

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Roberts Auto Sales and Service (RASAS) includes three automotive dealerships, two parts distributors, a large auto body repair facility, and a salvage yard. The dealerships sell a number of American and Japanese automobile brands, and each location includes its own service facility. RASAS is owned by Vicky Roberts, who has built the company into the diverse and successful business that it is today. Roberts has always maintained a love for vintage cars. She recently purchased a 1965 Shelby Mustang GT, which she intends to fully restore. This project is as much about fulfilling a lifelong dream as it is exploring the option of expanding her business. Roberts believes that the public shares her passion for classic cars, and she wants to see if her business has the resources to provide a car restoration service. The following is an overview of the feasibility of Roberts’ vision (Krajewski, Malhotra, & Ritzman, 2016).

New Proposed Business

Roberts understands that there are two types of customers in the car restoration business. The first group enjoys the process of restoration as much as the finished product. These customers seek out the parts they need and perform much of the work themselves. The second group loves vintage cars, but may not have the time or resources to complete the work on their own. They are happy to pay someone else to do the work, and then enjoy the car when it is finished (Krasjewski, et. al., 2016).

Roberts believes that her business will appeal to both types of customers. For those who want to restore their own cars, RASAS will serve as a parts broker. It has the network to locate difficult to find parts, as well as the capability to build parts that no longer exist. Furthermore, the proposed new business would create a parts library and be a resource to customers. For the second group, it offers the resources to restore cars, from start to finish. It has the personnel, facilities, equipment, and network to take on virtually any project. The new business will face little competition because it will have the ability to serve both types of customers under one roof (Krajewski, et. al., 2016).

The proposed expansion figures to fit in nicely with the existing divisions of RASAS. Roberts’ father owned a Ford dealership before her, so her parts stores likely already have vintage parts and the contacts to find more. The company already owns an auto body repair shop, which includes a car painting facility. RASAS also has three service facilities that each employ experienced mechanics. Although a new facility will need to be built and more workers will need to be hired, many of the required resources are already in place (Krajewski, et. al., 2016).

Mustang Restoration Project

The Mustang restoration project will serve two purposes. First, the car will be shown at a Detroit auto show to attract business. Secondly, it will give RASAS hands-on experience with taking on a project of this scope, and serve as a barometer for future projects. It will demonstrate how the new business will manage costs, quality, customer service, and scheduling flexibility from an operations standpoint (Krajewski, et. al., 2016).

Roberts has set a total project budget of $70,000. She spent $50,000 on the Mustang, which leaves a remaining budget of $20,000 for the restoration. There is a deadline of 45 working days (9 weeks) for the project. The total estimated cost of restoration is $18,100, of which no more than $3,600 can be spent in any given week. Managers from the parts, auto body, and service departments have compiled a list of required activities for the project. Each activity includes completion time, precedence relationships, and cost estimates. Program evaluation and review technique with critical path method (PERT/CPM) will determine whether the project can meet budget and timeframe guidelines (Krajewski, et. al., 2016).

Project Activities Table

The following table includes a description and corresponding letter for each activity, the estimated time each activity will take to complete, precedence relationships, and activity slack:

Activity

Time

Precedence

Slack

A: Request all parts, materials

2

N/A

0

B: Take receipt of interior materials

30

After activity A

0

C: Take receipt of windshield

10

After activity A

15

D: Take receipt of oil pump, carburetor

7

After activity A

12

E: Detach chrome components

1

N/A

9

F: Detach body

1

After activity E

9

G: Refurbish fenders

4

After activity F

21

H: Refurbish trunk, hood, and doors

6

After activity F

9

I: Remove motor

1

After activity F

18

J: Grind off frame rust

3

After activity I

16

K: Repair valves

5

After activity I

9

L: Install new oil pump and carburetor

1

After activities D, I

12

M: Refurbish chrome components

3

After activity E

34

N: Install repaired motor

1

After activities K, L

9

O: Reattach trunk, hood, and doors

1

After activities H, J

14

P: Repair transmission, install new brakes

4

After activities N, O

9

Q: Install new windshield

1

After activity C

15

R: Reattach fenders

1

After activities G, P

9

S: Apply paint

4

After activities Q, R

9

T: Reupholster seats, floors, headliner

7

After activities B, S

0

U: Reattach chrome components

1

After activities M, S

15

V: Transport Mustang to Detroit

2

After activities T, U

0

 

This table provides information about the project activities and how they are related to one another. First, a description and designation are provided for each activity. Ordering all parts and materials is designated as activity A, receiving upholstery is activity B, and so forth. Second, the table provides and estimated time (in days) for each activity. Next, the precedence relationships are provided. For example, activities A and E do not have preceding activities, so they can be started at any time. On the other hand, activities G, H, and I must wait until activity F is complete. The final column on the table lists each activity’s slack, which is calculated from the network diagram below (Krajewski, et. al., 2016).

Network Diagram

The following network diagram provides a schedule of the project’s activities. There are 14 possible paths to completion. ABTV is the critical path because it will take 41 days to complete, the longest of any path. As such, none of the activities on that path will have slack (LinkedIn Corporation, 2019). All activities outside of ABTV have slack, which is calculated by subtracting the earliest start (ES) from the latest start (LS), or the earliest finish (EF) from the latest finish (LF). The network diagram provides evidence that the project will be completed within 45 days. It also proves that the project will stay within budget, and it is possible to use slack to avoid spending more than $3,600 in any of the 9 weeks of the project (Krajewski, et. al., 2016).

0

A

2

0

2

2

0

E

1

9

1

10

Start

                       

2

C

12

17

10

27

1

F

2

10

1

11

1

M

4

35

3

38

2

B

32

2

30

32

2

D

9

14

7

21

 

2

H

8

11

6

17

2

G

6

23

4

27

2

I

3

20

1

21

 

9

L

10

21

1

22

 

 

12

Q

13

27

1

28

8

K

13

17

5

22

3

J

6

19

3

22

8

O

9

22

1

23

 

39

V

41

39

2

41

23

U

24

38

1

39

32

T

39

32

7

39

19

S

23

28

4

32

18

R

19

27

1

28

13

N

14

22

1

23

14

P

18

23

4

27

ES

Act

EF

LS

Time

LF


Conclusion

The Mustang restoration project should serve as a building block for the proposed new business. Vicky Roberts has a viable business plan that will face little competition. Furthermore, RASAS has the existing infrastructure and resources to not only restore the Mustang, but also many more like it in the future. PERT/CPM proves that Roberts’ dream of bringing old cars back to life could very well become a reality.

References

  • Krajewski, L. J., Malhotra, M. K., & Ritzman, L. P. (2016). Operations Management: Processes and Supply Chains (11th ed.). Boston, MA: Pearson Education.
  • LinkedIn Corporation. (2019). Project Management Basics. Retrieved from https://www.lynda.com/Business-Skills-tutorials/Project-management-basics/196589/391490-4.html

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