Midterm

1. If Norm chooses to go ahead with the microprocessor conversion on the machinery without passing it by the team, what are the potential conflicts that might arise? What are the advantages of such a move? 2. If Norm decides to put the decision to the appropriate production team, what are the potential problems? What would be the advantages? 3. If the production team chooses to approve and imple-ment this microprocessor conversion project, what form of project organization will this represent? 4. Given the size of this organization and the number of projects they deal with, would it make sense to institute a Project Management Office? Is there another arrange-ment that might be a good alternative? 5. How much impact might microprocessors have on pro-duction costs? Assume that variable overhead represents the same percentage of costs as fixed overhead. Find the net present value if the microprocessors cost $25,000 and their installation runs another $5,000. Assume a 10% margin. 6. Compare Norm’s recollection of the division’s produc-tivity gains between 1995 and 1999 to Exhibit 2. Explain the inconsistency. 7. What would you recommend that Norm do? 

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