Running Head: THE PERT MUSTANG 1

Case: THE PERT MUSTANG

Student’s name:

Institutional affiliation:
THE PERT MUSTANG 2

1. Prepare the report that Vicky Roberts requested, assuming the project will begin

immediately. Assume 45 working days are available to complete the project, including

transporting the car to Detroit before the auto show begins. Discuss, briefly, the

aspects of the proposed new business, such as the competitive priorities that Roberts

asked about

Report:

Attention To: Roberts Auto Sales and Service (RASAS)

Proposal Analysis of Vintage Car Restoration Business

In the case as to venture into a new business sector for RASAS, from the current

provided services can be classified as an expansion of its current business which relates to the

proposal on Vintage Car Restoration Business. Through current automobile focus by RASAS,

expanding into Vintage Restoration will allow RASAS to become a market leader in the

automobile industry with its existing knowledge and experience. The contentment of the

venture also depends on the restoration of 1965 Shelby Mustang GT 350. The Restoration of

Mustang is a key strategy to attract more target group customers.

Below chart shows the business structure:

VINTAGE CAR RESTORATION

Proposal for New Venture

BAS S

BODYWORK & PAINTING WORKSHOP

AUTO PARTS STORE & SALVAGE YARD
CAR DEALERSHIP
 THE PERT MUSTANG 4

Focus Customer for the new venture:

 Customers who would like to do restoration for their Vintage Car collections

 Customers who would like to work on the restoration on their own and RASAS be a supplier

for the car parts and body manuals in assisting the completion of the modification of the

vintage car

Based on the new proposal, evaluated further below on the department basis for RASAS

development with the enhanced new venture;

Competitive Priorities:

A. Operations Department: The department with more relevant task to coordinate on obtaining

the spare parts and the restoration requirements accordingly.

1) New Department

RASAS’s current business consists of three dealerships of car that is involved in selling and

servicing several makes of Japanese and American cars, two part stores, one large body shop and car

printing business and one auto salvage yard. The decision to venture into vintage car restoration

business, which is new market segmentation, will attract new groups of customers and will

strengthen RASAS’s car empire.

2) Flexibility

RASAS responds to its customers’ wants and needs in restoring their old cars. Mr. Robert

believes that most customers do not have time to help themselves in restoring their vintage cars. By

venturing into the new line of business, RASAS will be able to satisfy 2 groups of customers which

include helping customers find the right parts, and assisting those customers who want to restore

their old cars through “Do-It-Yourself” by acting as a facilitator.

B. Marketing Department: The department with the importance to highlight and create

awareness on the competitive edge RASAS owns as compared to other competitors.

1) Promotion Strategy

Using the first Mustang restored by RASAS for exhibition as well as for advertising. By
doing so, customers will be attracted to the new shop and it is a great promotion strategy (Khulbe,

2016). It may gain the confidence and trust in customers who are interested for restoration on their

vintage cars. The first product would show the potential customers the quality of service as well as

the capability to restore the old car into a car which is as good as new.

2) Demand / Customer Acceptance

The public are interested in vintage automobiles restoration. Hence it projects a future

potential to expand into the new venture. There are many people who own a vintage car or people

who are planning to purchase a vintage car and would want to restore their cars, but do not have time

to do so. They actually can afford to pay for the restoration. This group of people is usually rich and

are willing to spend money on their interests (RECKLIES, 2015).

In summary, the success of the new venture as per the planned budget by Robert highly

depends on the ability to restore the Mustang and the quality of the work, as well as the completion

of work within 45 days. Once these are achieved, the Mustang can be displayed at the Detroit Auto

Show which will provide RASAS the great opportunity to draw the attention of customers on

RASAS’s branding thus to have confidence and trust in RASAS for the transformation of their

vintage vehicles (Rodionova, 2016).

2. Create a table containing the project activities used in the letter assigned to each activity,

the time estimates, and the precedence relationships from which you will assemble the network

diagram.

Below is the list of Project Activities, Precedence Activitie(s), Time Estimates and Costs:

Time
Precedence
Activity Description Required Cost
Activity (days) ($)

Order all needed materials and parts

A (Upholstery, Windshield, Carburetor, - 2 100
Oil Pump)

B Receive Upholstery material for seat covers A 30 2,100

C Receive Windshield A 10 800

D Receive Carburetor & Oil Pump A 7 1,750

E Remove Chrome from body - 1 200

F Remove Body (doors, hood, trunk, E 1 300

fenders) from frame

G Have fenders repaired by body shop F 4 1,000

H Repair doors, trunk and hood F 6 1,500

I Pull Engine from Chassis F 1 200

J Remove rust from frame I 3 900

K Regrind Engine Valves I 5 1,000

L Replace Carburetor & Oil Pump I&D 1 200

M Re-chrome Chrome parts E 3 210

N Reinstall Engine K&L 1 200

O Put doors, hood & trunk back on frame H&J 1 240

P Rebuild Transmission & replace Brakes N& 4 2,000

O

Q Replace Windscreen C 1 100

R Put fenders back on G&P 1 100

S Paint car R&Q 4 1,700

T Reupholster interior of car B&S 7 2,400

U Put Chrome parts back on S& 1 100

M

V Pull car to Detroit Auto Show T&U 2 1,000

3. Draw a network diagram of the project similar to Figure 7.3. Determine the activities on

the critical path and the estimated slack for each activity.

Network Diagram:

A-B-T-V is the Critical Path which will take a total of 41 days

Time slack of each activity is shown in the table below:-

Earlier Latest
Activity Time Slack
LF - EF
(days)
ES EF LS LF
A 2 0 2 0 2 0
B 3 2 32 2 32 0
0
C 1 2 12 17 27 1
0 5
D 7 2 9 14 21 1
2
E 1 0 1 14 15 1
4
F 1 1 2 15 16 1
4
G 4 2 6 23 27 2
1
H 6 2 8 16 22 1
4
I 1 2 3 16 17 1
4
J 3 3 6 19 22 1
6
K 5 3 8 17 22 1
4
L 1 9 10 21 22 1
2
M 3 1 4 35 38 3
4
N 1 10 11 22 23 1
2
O 1 8 9 22 23 1
4
P 4 11 18 23 27 9
Q 1 12 13 27 28 1
5
R 1 15 16 27 28 1
2
S 4 15 19 28 32 1
3
T 7 32 39 32 39 0
U 1 19 20 38 39 1
9
V 2 39 41 39 41 0
4. Prepare a project budget showing the cost of each activity and the total for the project. Can

the project be completed within the budget? Will the project require more than $3,600 in any

week? To answer this question, assume that activities B, C, and D must be paid for when the

item is received (the earliest finish time for the activity). Assume that the costs of all other

activities that span more than one week can be prorated. Each week contains five work days.

If problems exist, how might Roberts overcome them?

Table below shows Weekly Budgeting and Total Cost Estimation:-

$/da
Task $ Day W1 W2 W3 W4 W5 W6 W7 W8 W9
y
A 100 2 50 100
B 2,100 30 2,100
C 800 10 800
D 1,750 7 1,750
E 200 1 200 200
F 300 1 300 300
G 1,000 4 250 750 250
H 1,500 6 250 750 750
I 200 1 200 200
J 900 3 300 900
K 1,000 5 200 400 600
L 200 1 200 200
M 210 3 70 210
N 200 1 200 200
O 240 1 240 240
P 2,000 4 500 2,000
Q 100 1 100 100
R 100 1 100 100
S 1,700 4 425 1,700
T 2,400 7 343 1,028 1,372
U 100 1 100 100
V 1,000 2 500 500 500
Weekly Total 2,910 4,690* 3,100 1,900 0 0 3,128 1,872 500
*Week 2 budget exceeding $3,600 threshold due to big ticket items (Carburetor and Oil Pump)
In order to achieve weekly costs below $3,600, tasks G and task J can be moved to Week 4 as
shown in the revised Weekly Budgeting Table below:-

Weekly Budgeting within $3,600 threshold:-

$/da
Task $ Day W1 W2 W3 W4 W5 W6 W7 W8 W9
y
A 100 2 50 100
B 2,100 30 2,100
C 800 10 800
D 1,750 7 1,750
E 200 1 200 200
F 300 1 300 300
G 1,000 4 250 750 250 250
H 1,500 6 250 750 750
I 200 1 200 200
J 900 3 300 900 900
K 1,000 5 200 400 600
L 200 1 200 200
M 210 3 70 210
N 200 1 200 200
O 240 1 240 240
P 2,000 4 500 2,000
Q 100 1 100 100
R 100 1 100 100
S 1,700 4 425 1,700
T 2,400 7 343 1,028 1,372
U 100 1 100 100
V 1,000 2 500 500 500
Weekly Total 2,910 3,540 3,100 3,050 0 0 3,128 1,872 500

Budget Amount ($)

Rework Budget 18,100
Car purchased 50,000
Total 68,100

 Total estimated costs are within the budget threshold of $70,000.

 All Weekly Budgets are below $3,600 limit.

Recommendations:

RASAS should proceed with the Restoration Project as various aspects are feasible such as:-

 Total estimated budget is within the threshold of $70,000

 Weekly estimated costs can be capped within $3,600 per week
 Total completion Timeline is manageable within 45 days to meet the Detroit exhibition To

further manage the risks of potential problems, may perform the following action plans:-

 Work overtime during weekdays or weekends

 Outsource some of the jobs such as body paint and car delivery

 Hire part time workers

 Collaborate with other workshops

THE PERT MUSTANG 12

Reference:

Activity Network Diagram http://www.businessdictionary.com/definition/activity-network-

diagram.html

Concepts of Network Diagram https://www.simplilearn.com/network-diagram-concept-article

Connecting a Project’s Parts with a Network Diagram http://www.brighthubpm.com/project-

planning/12712-connecting-a-projects-parts-with-a-network-diagram/

Critical Path Analysis and PERT Charts https://www.mindtools.com/critpath.html

Importance of Critical Path method in Project Planning

http://creately.com/blog/diagrams/critical-path-method-projects/

Khulbe, Y. (2016, June 30). Marketing Strategies For Classic Car Dealers. Retrieved from

The Huffington Post: http://www.huffingtonpost.com/yatin-

khulbe/post_12455_b_10731384.html/

Project Management Skills - The Critical Path Method (CPM)http://www.project-

management-skills.com/critical-path-method.html

RECKLIES, D. (2015, February 8). Market Segmentation – Why is it Important? Retrieved

from THEMANAGER.ORG: http://www.themanager.org/2015/02/market-

segmentation/

Rodionova, Z. (2016, March 2). Super rich keep spending on cars, jewellery and art even as

global wealth decreases. Retrieved from Independent:

http://www.independent.co.uk/news/business/news/super-rich-keep-spending-on-cars-

jewellery-and-art-even-as-global-wealth-decreases-a6906961.html