Case Study: Captiva Conglomerate System Analysis and Solutions

This case study analyzes the problems faced by Captiva Conglomerate, including significant delays in the inventory system, cost overruns, and issues with the system's specifications. The major problem identified is the delay in the inventory system coupled with cost overruns. The analysis examines the root causes, such as poor communication and inadequate specification drafting. Several solutions are proposed, including negotiating for supplemental changes, terminating the existing contract, and utilizing a spare management system. The recommended course of action involves both terminating the contract to start fresh with clear specifications and implementing the spare management system while providing necessary training. The implementation strategy focuses on training sessions for users to ensure system operation and seeking legal advice regarding contract termination. Additionally, the analysis suggests discussions between SOS and Captiva on implementing contract termination at minimal cost. The old system will continue to function at Captiva while the specifications are refined.

CAPTIVA CONGLOMERATE CASE
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Major Facts
The system currently is not usable and is running behind schedule. There is ten months delay in
the inventory system (both regional and centralized). Also, the SOS manager has communicated
that the contract ceiling of $1 million has been reached. Also, as many as 17 unpriced change
orders have been witnessed. Also, there seem to be issues about the specification defining and
designing which are taking a roll.
Major Problem
The core issue is the huge delay in the inventory system coupled with cost overruns. Also, there
are difficulties being faced in operating with a parts system. The specifications were only
reviewed by the IT manager and the communication of these via proper channels along with
departments has been found lacking. Also, the specification drafting seems lacking, and the
review of the same by Lana also seems faulty considering she did not read it thoroughly.
Possible Solutions/Alternatives
A. Attempts should be made to negotiate for supplemental changes taking into confidence the
various parties involved. This negotiation would need to account for the existing budget
that has been used for the contract fulfilment. This option has the advantage that the
specifications and expectations of the system would be defined. The disadvantage is that
the developer may not be open for a renegotiation particularly considering the favorable
terms of the contract for the same.
B. The complete contract for convenience can be terminated by Captiva. The obvious
advantage is that it provides the company with an opportunity to make a fresh start with

precise specifications. The disadvantage is that they would need to make the payment to
the developer and simultaneously they would be still left without a usable system.
C. The company could use the spare management system and provide training on usage of the
same. The obvious advantage is that there would be a system in place atleast for spare
parts. The disadvantage is that the company would need to provide incremental training to
the users at extra time and resource consumption.
Choice and Rationale
Considering the given situation, it would be prudent to go for both B and C. Considering the
uncertainty over specification, cost overruns, time delays and other technical glitch, it makes
sense to wind up the current project and make a fresh beginning with precise specifications.
Also, meanwhile the spare management system needs to be used since it is usable and only
incremental training is required which should be provided.
Implementation
It is essential that training sessions must be arranged by Jim so as to ensure that training to
operate the system is granted to people. These people can then provide the requisite knowledge
to others and enable the perpetuation of the system on an organizational level. With regards of
T4C, to avoid any legal issues at a later stage, it is imperative opinion must be sought from the
legal department. Also, SOS and Captiva need to carry out discussion on how to implement T4C
at very low or perhaps at zero cost. Post this discussion, the old system can continue existing at
Captiva and meanwhile the issues with the specifications can be sorted out by the respective
departments and users.