East Carolina University

OMGT 6333 – Project Management

Classic Lifestyle Auto Restoration

Project Plan

Steven C. Thacker

Table of Contents

Problem Statement 3

Assumptions 4

Alternatives 5

Statement of Work 6

Budget Breakdown Figure 8

Strategic importance of the project 9

Scope management 10

Project Deliverables 11

Work Breakdown Structure 11

Configuration management 12

Time management 13

Gantt Chart 13

Cost management 14

Cost Distribution Chart 14

Human resource management 15

Communications Responsibility Matrix 16

Risk management 17

Communication management 18

2

Problem Statement:

Finding a classic car that is restored back to its original quality when it was built is a

difficult process. Some vehicle restoration companies cut corners to save money and

leave their customers with a product that is less than excellent in the process. So, how

does someone find a quality classic car restoration company to either bring their

restoration project to or buy an ongoing project? They go by word of mouth to a

company with a strong reputation within the enthusiast community like Classic Lifestyle

Company.

The goal of this project is for Classic Lifestyle Company to find a local classic car,

restore it (mechanically and visually), and then sell it for a profit. To do so the Classic

Lifestyle Company will have to obtain a building in Greenville, NC to conduct the repairs

on the vehicle, hire talented automotive technicians, and find parts and raw materials

required to complete the restoration in a timely manner. A strict budget and time frame

will be put in place to keep labor costs as low as possible, allow us to maintain

scheduling benchmarks, and still achieve superior quality build projects.

3

Assumptions:

Assumption 1 (High risk) - The Classic Lifestyle Company will be able to find a classic

car locally within the allotted $5,000 budget.

Assumption 2 (Medium risk) – The Classic Lifestyle Company will be able to sell our

completed restoration project for $25,000.

Assumption 3 (Low risk) - Classic Lifestyle Company will be able to find a garage in

Greenville, North Carolina with a monthly rental price of $1,200 within our time frame.

4

Alternatives:

Alternative 1 – If the Classic Lifestyle Company is unable to find a local classic car

within the project’s $5,000 budget we will have to either 1) increase our search area for

a classic car (which will cause as cost overrun due to transportation costs) or 2) acquire

a vehicle in less than desirable condition and likely causing a schedule overrun during

the rebuild/replace parts phase. Either scenario will decrease the projected profit

margin.

Alterative 2 – In the Budget Breakdown (Fig. 1), the project team realizes the final sale

price of the vehicle may fluctuate as low as $22,000. Expecting this, the Classic

Lifestyle Company will still be able to realize a profit from on the lower quartile of their

expected profit.

Alternative 3 – If Classic Lifestyle is unable to find a garage for rent within our budget

we will be forced to inflate our rental budget. Doing so would still allow us to complete

the restoration project but would also decrease our project profit at the project’s

completion.

5

Statement of Work (SOW):

Classic Lifestyle is a classic car restoration company that finds local classic cars,

restores them, and sells them for a profit. The company will build specific vehicles upon

a customer’s request with a signed contract or sell them outright at the completion of a

build.

The project plan has been broken into three main parts. Part 1 will require the project

team to find the vehicle, part 2 is the mechanical and visual restoration of the vehicle,

and part 3 is the sale of the vehicle. All of which are included in the statement of work.

Part 1: Acquire a local classic vehicle (between 25-50 years old)

The first three days of the project have been allotted to find an appropriate

classic car for the restoration project

An appropriate car includes characteristics like desirability, completeness, and a

higher than average resale value

Part 2: Restore the vehicle mechanically and visually

During day four and half of day five the vehicle will be totally disassembled

Half of day five into day nine will involve rebuilding (when possible) and replacing

worn or broken parts on the vehicle

Half of day nine and the next two days are reserved for prepping the vehicle for

paint and then painting the vehicle according to the designated VIN (vehicle

identification number) color

Half of day eleven into day twelve the vehicle will be reassembled

6

Half of the final day, twelve, will involve polishing and the final cleaning of the

vehicle before sale

Part 3: Sell the classic car to an interested buyer willing to pay the asking price

Sell the vehicle to a qualified buyer

1. The parties of agreement include the project manager, functional manager, functional

employees, and the project sponsor

2. This agreement has been initiated by Classic Lifestyle as their ongoing business

model

3. The tangible output of the project will be the restored classic car ready for sale

4. The project will be funded by the new project sponsor Steven Thacker

5. Project Duration

The start date will be March 2, 2014

The end date is March 14, 2014

The total length of the project is 10 working days (not including one weekend)

6. The budgeted amount for the project is $17,450

7. Any termination of sale by a buyer will result in the disqualification of their security

deposit to hold the vehicle, if required, and the need to find another qualified buyer

immediately

7

Budget breakdown

Fig. 1

Event CostOne month building rental price

$1,200

Vehicle Cost $5,000Painting supplies (paint, tape, sand paper, misc.)

$1,500

Paint labor $1,100Car parts $4,000Rebuild/replace worn items labor

$2,200

Disassembly/reassembly labor $1,650Miscellaneous shop supplies (welding gas, lighting, etc.)

$800

Total $17,450Sell price $22,000 - $25,000

Potential profit $4,550 - $7,550

Labor rate breakdown: $25 per hour for 9 hours a day = $225; $225 * 2 technicians = $550 per day

8

Strategic importance of the project:

The owners of Classic Lifestyles restore classic vehicles in order to keep older cars

alive, strong, and running on the roads when they might have been considered beyond

repair. Completing cars on time and within budget allows the Classic Lifestyle Company

to make a profit and continue to deliver quality classic vehicle restorations. This

business model aims for add-on business by having repeat and happy customers.

Therefore, the Classic Lifestyle Company defines success as the ability to attain healthy

profit in order to continue buying, restoring, and selling classic vehicles.

Our customer’s define a successful project as having purchased a restored vehicle at a

reasonable price, with quality that exceeds the original equipment manufacturer (OEM),

and having agreeable interactions with the company throughout the project. Interacting

in such a manner causes our customer’s to bring their vehicles to us for service in the

future and continue purchasing vehicles with Classic Lifestyle Company (add-on

business).

9

Scope management:

The project team will manage scope creep to the best of their abilities by following the

projected deliverable schedule and the Work Breakdown Structure.

In addition, the functional team members of the project will be technically oriented

towards the completion of the project on the scheduled date of March 14 th. Regular

meetings between the project manager and functional manager will help reduce scope

creep also.

For this restoration project the project sponsor has a vested interest in the success of

the project for the Classic Lifestyle Company. Therefore, the project sponsor will likely

follow the expected project deliverables and discuss the milestones with project

manager as they occur to confirm the project is on target and on budget.

The following page shows the project deliverables with expected due dates and the

Work Breakdown Structure (WBS).

10

Project Deliverables

Fig. 2

Restoration Project Deliverables

Deliverable Due Date

1 Find vehicle 03.02.14

2 Vehicle disassembly 03.04.14

3 Rebuild/replace worn items 03.07.14

4 Prepare and paint vehicle 03.12.14

5 Reassemble vehicle 03.13.14

6 Final polish and sale preparation 03.14.14

Work Breakdown Structure

Fig. 3

Configuration management:

Technical changes will be

made by the project

manager and then given

to the functional manager

to advise the technicians. The functional manager will also be able to make technical

changes after having them be approved by the project manager. The functional

11

manager will follow factory specifications to ensure all manufacturer specifications and

tolerances are met or exceeded.

Parts will be shipped to the Greenville, NC shop location via UPS small business

shipping account. UPS provides RFID tracking which will help management track

vehicle parts and better organize the technicians to complete the project on time.

One of the avenues we will use to source car parts will include local dealerships like

Toyota, Mazda, Nissan, and Chevrolet (depending on the manufacturer of the classic

vehicle the project team finds). The other primary source for car parts will come from

aftermarket suppliers like O’Reily’s Auto Parts and Advance Auto.

Time management:

Classic Lifestyle has planned six milestone for the restoration project using a Gantt

chart which includes finding the vehicle, vehicle disassembly, rebuild/replace worn

items, prepare and paint vehicle, reassemble vehicle, and prepare the vehicle for sale.

12

The Gantt chart will be used by the project manager to develop decisions based on the

project teams progress-to-date. Each of the milestones listed in the Gantt chart has a

start and finish date and lists the expected duration for each critical activity.

Another potential benefit of using the Gantt chart would be the ability to display to a

potential customer when they can expect their vehicle (if the vehicle is sold and the

customer is waiting for the restoration to complete).

Gantt Chart

Fig. 4

Cost management:

Managing the costs on this project will be critical in the success or failure of the project.

The team estimates a potential profit of 30.2% of the projected selling price. The total

breakdown of costs is displayed in the cost distribution pie chart in Figure 6.

13

Furthermore, the project team will manufacture any items we can in-house to help

control costs. This may include rebuilding worn components that are removed from the

vehicle or replacing small rusted areas of the vehicle with new sheet metal that is

formed by hand. To prevent a cost overrun all of these in-house repairs will be

conducted between Tuesday March 4th and March the 7th.

Cost Distribution Chart

Fig. 5

4.8%20.0%

6.0%

19.8%

19.2%

30.2%

Classic Lifestyle Restoration Project

Building Vehicle

Paint Labor

Parts & Misc Profit

Human resource management:

One of the most critical aspects of this project is being able to appropriately staff

functional employees that are technically qualified enough for a restoration project.

These professionals need to find the restoration process interesting, have a technical

14

expertise, be able to supply their own tools throughout the project, and be able to

troubleshoot mechanical concerns on a regular basis.

Therefore, the functional manager reviewing the automotive technician’s resumes and

grade them by how much previous experience they have restoring classic vehicles. A

qualified individual will have successfully restored at least one other vehicle from start to

finish.

A qualified project manager will have had at least two years in that role and preferably

have had some exposure to the automotive industry (but not mandatory). Also, the

functional manager will serve as the shop foreman and directly oversee and direct the

functional employees on a daily basis (refer to Figure 3).

Referring to the responsibility matrix we can see the project will be led by the project

manager. A functional manager will perform the role of a shop supervisor and keep the

functional employees on schedule. Finally, I will be fulfilling the role of the project

sponsor in order to fund the project as well as communicate with potential classic car

buyers.

Communications Responsibility Matrix

Fig. 6

15

Risk management:

16

There are multiple factors to be considered when attempting to mitigate risks in a

project plan. To help minimize risks throughout the project our project manager will use

a proactive management approach and considers future problems before they surface.

This is why a higher importance has been placed on the schedule and cost of parts and

labor for the project in recognition of them being the largest financial risk factor.

One area of external risk our team recognizes is being able to find and acquire an

appropriate vehicle for restoration within the schedule. A suitable vehicle will need to

have minimal amounts of rust (as those areas would take longer to repair and cause the

team to exceed the timeframe). In addition, the vehicle needs to be one that other car

enthusiasts would like to purchase once the project is complete. More desirable

vehicles will draw a larger pool of potential buyers and minimize the risk of being unable

to sell the car at the end of the project. The team will secure trade magazines and

search the internet to find a desirable car within our budget and timeframe.

The last primary area of risk will be the acquisition of car parts. Local dealerships are

less likely to carry parts for classic (25-50 years old vehicles). Therefore, some missing

or broken parts that are not carried aftermarket will have to be found in local savage

yards or sourced on the internet which could cause a schedule overrun.

Communication management:

17

This project team recognizes the typical communication traps that can occur during

projects. One such a trap is the communication between the functional managers and

his employees. Another communication issue can occur between the project manager

and the functional manager. One way to help mitigate communication issues between

the project manager and the functional manager is by using status reporting.

The first communication trap between the functional manager and the functional

employees will be mitigated by having the functional manager will conduct morning

meetings and communicate daily tasks for the technicians.

Another communication tool will be the use of a dry-erase board placed in the shop with

a bulleted list of activities needing to be completed (remove the interior, strip the paint,

straighten sheet metal, replace worn components, etc.). The meeting between the

functional manager and employees will help the functional employees express what

they need from the functional manager. These requests could be parts and services that

the functional manager would take care of in order to keep the project on schedule.

The final way the Classic Lifestyle Company will facilitate better communication during

the project is by having meetings between the project manager and the functional

manager on an as-needed basis. These meetings will review whether scheduling

milestones are being met and if the actual accumulated costs are staying within

estimated budget.

18