International Guidance Essay

885 WordsMay 19, 20134 Pages
Memorandum To: Mr. Thomas Stearns, Project Manager, International Guidance and Controls From: Date: October 2, 2012 RE: Software Project for CARV Command and Guidance System _____________________________________________________________________ I have recently received and reviewed your memorandum regarding your issue with the Confined Aquatic Recovery Vehicle project. I have considered three options and their ability to save your company as much money as possible while completing this project in a timely manner. The three alternatives I considered were to immediately invest in hardware, to stay on your current path with the software developments only or to wait and reevaluate your situation in five months. Each of these…show more content…
Lastly, option number three (Attachment 2), to wait five months and continue with software developments and then reevaluate the progress of the situation, resulted in the lowest EMV of $3.29 million. For the third alternative, I have made sure to consider your estimates of the favorable and unfavorable progress possibilities that could affect the situation in five months. For each of the calculated EMV’s, I assumed that two months was the maximum amount of extra time needed if the software developments were not completed on time. As you stated in your memo, one or two months extra would suffice for the developments but there is always a chance that two months will not be enough time in which case the EMV would go up. I also assumed that your probabilities would prove to be accurate. Variations in the probabilities would also cause the EMV to change. Reputation Analysis: The EMV calculations previously discussed did not take into account the intangible cost of a damaged reputation in the event that the project is not completed on time. The costs cannot be certain because they have no concrete value but I have done my best to estimate the impact of a damaged reputation based on the EMV calculations stated above (Attachment 3). Continuing with your current software developments is immediately ruled out because the costs continue to go up and are the highest of the three
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