Appendix B - Case Study #4 - Blue Mountain Cabin
(Source: Larson, E. W., & Gray, C. F. (2017). Project management: The managerial process (7th
ed.). Columbus, OH: McGraw -Hill Irwin)
Jack and Jill Smith have just retired and want to build a small, basic cabin in the Blue
Mountains of Vermont. They have hired Daryl Hannah as the general contractor for the
project. She has assembled a team of three workers to complete the project: Tom, D ick, and
Harry. Daryl has negotiated a cost -plus contract with the Smiths whereby she will receive 15
percent beyond the cost of labor and materials. Before they sign the contract, the Smiths want
an estimate of how much the project is likely to cost and h ow long it will take. Darryl has
estimated that the cost for materials, permits, etc., will total $40,000. She wants to determine
labor costs as well as how long the project will take. This is one of several projects Daryl is
managing, and other than occas ionally helping out, her role is strictly limited to supervising.
She has devised the following master plan and assignments. Note that Dick is the only skilled
plumber in the group while Harry is the only skilled electrician. Tom is a general carpenter and
can assist them with their work. Dick and Harry each get paid $300 a day while Tom gets paid
$200 per day. Darryl has negotiated a 10 percent management reserve to deal with
unexpected problems. Unused funds will be returned to the Smiths.
Table 2 Estimates of Blue Mountain project
ID Task Predecessor Time (days) Assignment
A Prepare sits None 2 Tom, Dick, Harry
B Pour Foundation A 2 Tom, Dick, Harry
C Erect Frame B 4 Tom, Dick, Harry
D Roof C 3 Tom, Dick, Harry
E Window/Doors D 2 Tom, Dick
F Electric D 2 Harry, Tom
G Plumbing D 2 Dick, Tom
H Rough-in-frame E,F,G 2 Tom, Dick, Harry
I Clean up H 1 Tom, Dick, Harry
Case Questions
1. How can outsourcing project work alleviate the three most common problems associated with
multiple resource scheduling?
2. Explain the risk associated with leveling resources, compressing or crashing projects and impose
durations or “catch up” as the project is being implemented.
3. Prepare a short proposal for the Smiths that includes a Gantt chart with resources assigned, and
cost estimates if the project starts on 8/1/16.
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