Dear Experts,
Please help me to solve problem number 5 and 6 .
Thank you
Payton Corporation Payton Corporation had decided to respond to a govermment RFP for the RE:D phase on a new project. The statement of work specified that the project must be completed within ninety days after go-ahead, and that the contract would be at a fixed cost and fee The majority of the work would be accomplished by the development lab According to govemnment regulations, the estimated cost must be based on the average cost of the entire department, which was $19.00 per hour (unburdened). Payton won the contract for a total package (cost plus fee) of S305,000. After 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 lab Project manager: \"Obviously you know why I\'m here. At the rate that you\'re spending money, we\'ll overrun our 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 department averages. Project manager: \"Well, why are we using the most expensive people? Obviously, there must be lower-salaried 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 accomplish 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
The main issue with the problem of Payton corporation is the concern regarding the conflict with Labour rates. There is a disagreement between the actual rate and the Labour rates which were budgeted when the project started. The project manager is at fault in this situation wherein proper review and analysis for the pay structure was not performed.
If it was a longer duration project then a carefully planned and we\'ll analyzed pay structure would have been assigned. There would have been proper management as a project manager to ensure that the goals and objectives are fulfilled. The focus would have been to increase the productivity and keep the employees happy. This would have been useful for the project and making sure that the issue is fixed. Pay would be fixed by taking the demands and interests of the employees into consideration and it will be ensured that any conflict of interest does not occur.
The customer should take responsibility for this type of situation wherein the issue is grave. The short term project should last for three months.
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