Dear experts Please help me on this case study Appreciate Pa

Dear experts,
Please help me on this case study.
Appreciate

Payton Corporation Payton Corporation had decided to respond to a government R FP for the R&D; phase on a new project. The statement of work specified that the project must be completed within ninety days afer go- contract would be at a fixed cost and fee The majority of the work would be accomplished by the development lab. According to regulations, the estimated cost must be based on the average cost of the entire department, which w hour (unburdened) as $19.00 per contract for a total package (cost plus fee) of $305,000. Afer the first weekly labor report was analyzed, it became evident that the development lab was spending $28.50 per hour. The project manager decided to discuss the problem with the manager of the development lah ments Project manager: \"Obviously you know why I\'m here. At the rate that you\'re spending money, we\'ll overrun budget by 50 percent.\" Lab manager. \"That\'s your problem, not mine. When I estimate the cost to do a job, I submit only the hours necessary based on historical standards. The pricing department converts the hours to dollars based on averages.\" department are we using the most expensive people? Obviously, there must be lower-salariesd people capable of performing the work.\" Lab manager: \"Yes, I do have lower-salaried people, but none who can complete the job within the two months required by the contract. I have to use people high on the learning curve, and they\'re not cheap. You should have told the pricing department to increase the average cost for the department.\" Project manager.\"I wish I could, but government regulations forbid this. If we were ever audited, or if this proposal were compared to other salary structures in other proposals, we would be in deep trouble. The only legal way to plish this would be to set up a new department for those higher-paid employees working on this project. Then the average department salary would be correct. \"Unfortunately, the administrative costs of setting up a temporary unit for only two months is prohibitive. For long-duration projects, this technique is often employed.

Solution

a) The problem in current case is poor cost and work planning that resulted in variation in the planned and actual costs.

b)

Project planning department that includes the project costing, project labor calculation and project manager is at fault. Project manager is at fault because he did not considered the risks of the project    

c)

The situation cannot be corrected as the project duration are already finalized and project is awarded.

d)

For future project this situation can be avoided by showing the proper justification of the cost and time. If the cost are not increasing the project manager is supposed to reduce the risk of cost overrun by asking additional time with justification.