Captiva Conglomerate Case Study Analysis
Major Facts: ?System specifications not clearly defined ?Contract wording is partial to S. O. Software ?Spares management module is a disaster ?Spares management module currently complicated and un-useable/outdated ? Spares management module behind schedule ?Regional and centralized inventory management system behind schedule ? S. O. Software depleted allotted financing ?The system software specifications were not drafted by S. O. Software personnel Major Problems: The contract was not reviewed by appropriate personnel prior to contract award ? The spares management module is 4 months behind schedule ? The spares management system requirements is a hassle ?The spares management module does not provide relevant data ? The regional and centralized inventory management system is 10 months late ? The contract calls for “best effort,” “whenever possible” ? The 1 million called for in the contract is used up ?17 un-priced change orders The specifications looked like they were drafted by SOS, but Jana (IT manager) had initialed each page Solutions: Best Solution: Contract Renegotiation and Restructure Advantages: ?Bring in the SME (Subject Matter experts) to relook the concepts behind the contract. Restructure the contract based on existing monies to provide the type of service required. While leverage the existing contract with the current vendor may cause for some additional funding it provides the current vendor a change to improve on its product.
Providing the current vendor is agrees’ with the restructure this avenue is the most preferred in order minimize change and downtime of the current system. ?This approach allows the company to restate or clearly define the specifications, needs and current objectives, necessary to predict future cost and further invest the time, tools, and expertise necessary to ensure they get workable software systems. Disadvantages: ?The current vendor S. O.
Software may not be un-able or willing to work with the company in order to re-negotiate the existing contract. ?A poorly executed re-negotiation strategy can destroy a valuable relationship which may hinder the company’s ability to move forward with the supplier. The negotiations approach must take on the altitude of a win-win situation in order to provide the company with a incentive to re-negotiation. Alternate Solution: T4C, Termination of Contract Advantages: ?Captiva Conglomerate is able to cut the losses with the S.
O. Software Company; accurately re-define the specifications; provide an accurately cost analysis and procure a new company that is able to design a systems in accordance with the requirements within the allotted time while provide a customer service approach to address any issues that might arise. ?The ability to exit transactions with S. O. Software could have significant cost savings to Captiva Conglomerate rather than waiting for the contract to end and paying for poorly performed services. Disadvantage: Depending on where the contract is currently in its life cycle stage may cause for compensation to S. O. Software that is sufficient to cover any loss of profits over the remaining project term. ?Termination will also damage the company’s reputation with current and future businesses world. ?The company may risk a trial or protest because of the foggy nature of the “best effort” verbiage generally demands a factual determination as to its meaning. IMPLEMENTATION: The first step would be to completely re-examine the software requirements and request a new specification document based on current needs.
Secondly, I would implement an acquisition team to include program officers, contract specialist, IT personnel, finance, legal and any other relevant personnel in order to devise a performance work statement (PWS) conducive to the program. Third, engage the S. O. Software regarding current issues and concerns regarding the existing contract (simply why we have a needed to relook the contract: i. e. , the two systems being 4mos and 10mos behind, constant changes to the specs which led to depleted funding), then propose the new contract in a manner and fashion that provides a win-win for all vested parties.