Case Study – Stark Industries
As a multi-billion-dollar world leader in manufacturing automotive components, Stark Industries’
customer base includes virtually every major manufacturer in the global automotive, commercial
vehicle, and off-highway markets.
Despite the company size and market domination, the previous decade saw a reduction in
market share and an increase in the number of agile competitors that reduced Stark Industries
traditional competitive advantages. A strategic response was formulated and implemented that
relied upon the development of unproved new technology that unfortunately failed to gain
traction in the marketplace despite large amount of Research and Development funding. As a
result the company entered bankruptcy protection and a period of financial instability.
As the company emerged from bankruptcy protection, its Human Resources (HR) executives
wanted to reduce service costs, which were averaging US $20 million annually. Despite generally
excellent operational performance from the HR function within Stark Industries, it was decided
that considerable financial benefit from outsourcing selected HR processes would be achievable
without losing too many operational advantages.
By partnering with an array of best-in-class service providers for select elements of the program,
the company expected to both improve HR services and cut costs dramatically. Overall, there
were 15 discrete projects included in the HR Transformation Program, encompassing all aspects
of HR service delivery, such as Payroll, Benefits, Health and Welfare, and Pensions.
After eight months, however, the entire program was in jeopardy. Key milestones and
deliverables were not being met for any of the projects, and critical cost overruns were adding
up. With just four months remaining to complete the entire HR Transformation Program, the
CEO realized that the organisation did not have the program management expertise or a clear
operational plan to achieve the expected results.
Several of the selected service providers had difficulty in meeting Stark Industries HR
requirements, with short transition periods this had already had impacts on the operational
running of the organisation. Other projects had failed to project accurate costings and had
exceeded their reserves within months. Although there were duly constituted project boards and
governance structures, there was no PMO constituted to oversee the outsourcing program.
Referral Assessment 1: Stark Industries Business Report
Use the Case Study, your own reading and research of Operations and Project Management
concepts and models to answer the questions below in the form of a formal Business Report.
This written Business Report must be individual and the product of your own work.
The Business Report should be written in the style of a management consultancy report
analysing the planning and execution of the HR Stark Industries project and seeking to analyse
the project as it currently stands as well giving recommendations for project completion.
1) Identify and discuss the key operational factors involved in the outsourcing decisions of HR
2) Identify and discuss risks and mitigation strategies that should have been put into place for a
project of this nature
3) Discuss the options available to Stark Industries and give recommendations for successful
completion of the project.
You must use relevant academic models, frameworks and concepts in your Business Report,
demonstrated through credible and quality citations.
References must include academic sources.
Management and Administration of Projects and Operations Bss056-3
Assignment number and title
1 Referral – Written report
Weighting of assignment
Size or length of assessment
Unit learning outcomes
1. Demonstrate the following knowledge and understanding
• Understand the strategic context of operations and project management and how
tools, techniques, frameworks and academic models relate to operations and project
2. Demonstrate the following skills and abilities
• Analyse the operational and project management requirements of organisations to generate
appropriate and coherent solutions whilst demonstrating practical application of project
management software to develop a project plan