Engineering management report
Engineering Management Case Study
Section 9
Introduction
Glenn Foreman, the president of Oceanview Development Corporation is considering submitting a bid for a property to build a condominium. However the property is designated to be used for single-family residences only. He has a plan to send a referendum to change zoning of property and the permit for the construction of the condominium. He also plans to hire a researcher to find out the probability of the referendum being approved. Below are the important dates that play an important part in the decision making by Mr Foreman
Findings
The president of Oceanview Development Corporation decided to invest on a $15,000,000 property to build condominiums. He also has plans to send a referendum bid to change the zoning of property which requires him to pay 10% ($5,000,000x10%=$500,000) down payment from the cost of property.
Cost of property - $5,000,000
Cost of construction - $8,000,000
If the bid is rejected, the deposit will be refunded. If the bid is approved but Mr Foreman failed to follow through within six months the deposit will be forfeited. Mr Foreman has plans to hire a market researcher in order to get a better estimation or prediction on whether his referendum will be approved or not. The cost of hiring a market researcher is $15,000.
Consider the flowchart presented in Figure 1.2. Note that it combines the first three steps of the decision-making process under the heading of “Structuring the Problem” and the latter two steps under the heading “Analyzing the Problem.” Let us now consider in greater detail how to carry out the set of activities that make up the decision-making process.
Figure 1.3 shows that the analysis phase of the decision-making process may take two basic forms: qualitative and quantitative. Qualitative analysis
Section 9
Introduction
Glenn Foreman, the president of Oceanview Development Corporation is considering submitting a bid for a property to build a condominium. However the property is designated to be used for single-family residences only. He has a plan to send a referendum to change zoning of property and the permit for the construction of the condominium. He also plans to hire a researcher to find out the probability of the referendum being approved. Below are the important dates that play an important part in the decision making by Mr Foreman
Findings
The president of Oceanview Development Corporation decided to invest on a $15,000,000 property to build condominiums. He also has plans to send a referendum bid to change the zoning of property which requires him to pay 10% ($5,000,000x10%=$500,000) down payment from the cost of property.
Cost of property - $5,000,000
Cost of construction - $8,000,000
If the bid is rejected, the deposit will be refunded. If the bid is approved but Mr Foreman failed to follow through within six months the deposit will be forfeited. Mr Foreman has plans to hire a market researcher in order to get a better estimation or prediction on whether his referendum will be approved or not. The cost of hiring a market researcher is $15,000.
Consider the flowchart presented in Figure 1.2. Note that it combines the first three steps of the decision-making process under the heading of “Structuring the Problem” and the latter two steps under the heading “Analyzing the Problem.” Let us now consider in greater detail how to carry out the set of activities that make up the decision-making process.
Figure 1.3 shows that the analysis phase of the decision-making process may take two basic forms: qualitative and quantitative. Qualitative analysis