Niagara Fall Construction Project Case Study Solution
Introduction
The case is about constructing a detached double garage as a condition to meet the sale proceed of the family house of a mechanical engineering technician, Rikert who was also running his own construction business from approximately last two decades, has currently focusing only on constructing Detached double garage in the Niagara region. He wants to sell his house in order to move into a new larger home. After months of no offer, he finally gets an offer for his house, with an underlying condition to build a detached double garage, to the house with an increase of $ 10,000 to the existing demand price of the house. He knows that this is less than what he usually charges to their customers for such construction project, but he accepted it due to lack of alternative offer.
But the project appears to be more challenging than anticipated. He conducted such project before, but due to some restriction from bylaws, he faced difficulty in acquiring apermit to start the construction activity. On the other hand, he committed to hand over the house by 30th August, the sale agreement was agreed on 15th April, he has 18 weeks to complete the construction project. He also had an option to withdraw the agreement in the next two week without having any financial penalty.
Options available for crashing
Crash would be necessary as there is some issue relating to the planning phase that is critical and they are also uncontrollable, Rikert does mitigate the planning issues but they will still remain critical to some extent and cannot be mitigated beyond some point. There is huge potential to crash some activities relating to foundation phase, & structural phase that could also result in saving the cost of construction relating to labor & construction material it will also result in bringing the advantage of opportunity cost.
The time saved against one hour of theRikert personnel working hour will bring cost saving of $ 15 ($40 – $25) as he paid $25 to its workers for each hour of his work, he can further allocate proper time to his basement project undertaken as part of business activity. He can also avail the advantage of using his son James, for work relating to finishing phase of the project as he would likely be available during the first two weeks of August.
Niagara Fall Construction Project Harvard Case Solution & Analysis
By taking all the necessary measures identified above, Rikert would most likely be able to make breakeven at negotiated cost of $10,000 which is less than its normal charging cost to clients for building detached double garage, as part of business activity. Rikert is keen to proceed the sale of his house because his family is also very emotional towards the buying of their new house.
There is a probability 99.90 % that the project will be completed on 26th of August........................
This is just a sample partial work. Please place the order on the website to get your own originally done case solution.
Related Case Solutions & Analyses:
Corporate Governance in China: Currect Practice Key Problems
Motilal Oswal Financial Services Ltd.: An IPO in India
International Place (B): Perfect Ending
Massive Inc. (A)
Massport (D): Looking to the Future
Lambeth Custom Cabinets (A)
Metalcraft Supplier Scorecard
Note on Pre-Money and Post-Money Valuation (B)
AGENCY.COM (A): Launching an Interactive Service Agency
Sunrise Medical Inc.s Wheelchair Products
