THE WELCH COMPANY
440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700
S U M M A R Y
DIARY: May 1, 1992 09:46 AM Friday;
Called Wayne about results of York meeting and Welch; POIMS evaluation.
....Wayne said the Voith management asked for a statement of DNRC's
.........Engineer needs to "determine" that Voith failed to complete
....Contract Management Stressful Following Notice Provisions
........SDS & Confidentiality/Discovery
............Analysis - Loyalty v. Integrity
........Murphy's Law - Slippery Slope of Ignoring Record
........Purging Records Eliminates Intellectual Capital
......Wayne said a transcript was not made from the meeting. I
....Controlling the Record
4...Transcript of Prior Meeting
5...Review of Voith Submittals
....Wayne said they will decide this in a few days. He advised that
.......Wayne needs Memo from Walt
6...Repair Tape Drive
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0201 - Dep Natrl Rscrs & Consvn 406 444 6699 fax 6721
020101 - Mr. Wayne Wetzel
020102 - Director's Office
Welch Assignments, Backcharges to Voith from Sletten
Management Assistance Broadwater Contract
Strategy on Evaluating all Claims
Support Tudor Contract Closeout Letter of 891005
Discovery, Advantages and Restraints on saving the Record
Social Constraints Internal "Feel Good" Management
Too busy to manage effectively
Engineer's duty to determine disputes, Internal management
Command & Control of the Record
1312 - ..
1313 - Summary/Objective
131401 - Continue Voith claims?
131403 - Wayne said the Voith management asked for a statement of DNRC's
131404 - claims within the next two weeks. I explained DNRC's entitlement
131405 - cannot be fully developed within that time frame, but maybe we can
131406 - do an order of magnitude analysis. DNRC needs a statement of the
131407 - contract status, as discussed, ref SDS 8 line 98.
131408 - ..
131409 - Comment
131411 - Actually, this is a tactic to distract DNRC from the main
131412 - priority of applying management resources to fix the plant.
131413 - Only by putting in place a program to fix the plant, can the
131414 - damages be stopped.
131415 - ..
131416 - Voith's "request" for claims data is just another way for
131417 - Voith to put into the record something for DNRC to do that
131418 - takes the focus away from the central issue, so Voith can
131419 - control the agenda by creating things to argue about other than
131420 - Voith's refusal to fix the plant.
131422 - ..
131423 - Additionally, it is disengenuous for the contractor to continue
131424 - to withhold services while demanding DNRC expend time and money
131425 - on calculating an amount that is being escalated by Voith's
131426 - failure to perform. We do not really know what the damages are
131427 - until we get a design and schedule to fix the plant.
131429 - ..
131430 - In order to evaluate DNRC's claims we must first understand
131431 - what is wrong with the plant, and what Voith is going to do
131432 - about it, if anything, and if they are not going to perform,
131433 - then DNRC's claims will be much higher.
131435 - ..
131436 - Wayne advised DNRC may want me to complete at least an order
131437 - of magnitude presentation for DNRC on its claims.
131439 - DNRC should act to control the agenda and the record, by
131440 - issuing a statement to Voith (as part of the confirmation of
131441 - understandings from the meeting) on scope and timing of its
131442 - obligations to Voith with respect to this matter.
Writing in SDS is Inaccurate
Accountability is Burdensom for Executives
Psychologically Demanding, Truth
Consistent Discovery of Mistakes using
Discovery in Lawsuit
Slippery Slope Ignoring/Deleting Record,
Murphy's Law, What is the Cause
Cost/Benefit of Better Communications
2613 - ..
261301 - Management Support
261303 - Wayne said that he and Sarah believe that unsolicited advice from
261304 - Welch has been incorrect or otherwise harmful and therefore Welch
261305 - should only provide advice when specifically requested. He cited a
261306 - range of "nitpicking" facts Welch has set out, pertaining to DNRC
261307 - internal management processes which seem detrimental and/or
261308 - unproductive.
261310 - Wayne indicated an understanding that Welch's intent is to meet
261311 - his duty of notice to the State on steps needed to recover on
261312 - its claims and succeed with the project. Such duty arises from
261313 - the Broadwater contract and the record of performance by the
261314 - parties, per the discussion at ref SDS 6 line 137.
261315 - ..
261316 - Wayne noted however that DNRC staff feel comfortable
261317 - working with Power Engineering and believe that Power is
261318 - adequately advising the State on its business decisions.
261320 - We have previously discussed the problem of placing Power
261321 - in conflict with respect to advising a party to a dispute
261322 - about which the Engineer is to render a determination, ref
261323 - SDS 7 line 130804.
261325 - ..
261326 - It might be helpful now to consider the perspective
261327 - several months back, ref SDS 9 3940.
261330 - ..
261331 - The concern about "nitpicking" record keeping arises from the
261332 - difference between applying SDS internally v. externally (see
261333 - also the discussion below under "SDS Edits."
261336 - ..
261337 - Cost/Budgets
261339 - Sarah is also concerned about cost. Wayne has the sense she is a
261340 - little less confident of winning her argument about consequential
261341 - damages, and so views the Welch expense as depleting funds needed
261342 - to complete the project without accomplishing the tangible
261343 - deliverables for which he was hired, to wit: develop DNRC's
261344 - claims.
261346 - DNRC has significant entitlement to presumed damages that are
261347 - not dependent upon the Montana statute Sarah has in mind.
261350 - ..
261351 - Engineer needs to "determine" that Voith failed to complete
261352 - its contract within the specified time, as amended, and
261353 - therefore owes DNRC presumed damages. At that point Voith will
261354 - come forward with its defenses and evidence which can then be
261355 - evaluated on the merits. This is the advantage of having an
261356 - Engineer and a claims resolution process.
261358 - ..
261359 - It is also helpful for the Engineer to develop a budget and
261360 - schedule with assigned resources for project closeout, so
261361 - concerns about cost can be addressed in an orderly way (see
261362 - for example ref SDS 8 line 142).
261366 - ..
261367 - Contract Management Stressful Following Notice Provisions
261369 - Broadwater is a very difficult management problem caused by past
261370 - failure to follow the contract, which necessarily causes tensions
261371 - due to delays that occur in adjudication. SDS increases tensions
261372 - by giving notice of difficulties that have not yet occurred, and by
261373 - encouraging use of standard project management tools for timely
261374 - notice, which seem unnecessary to DNRC in light of their opinion on
261375 - the limited scope of problems facing the Broadwater project.
261377 - ..
261378 - SDS & Confidentiality/Discovery
261380 - This issue has caused tension because 5% of the record seems
261381 - harmful relative to discovery in arbitration. Welch does a lot
261382 - of arbitrations and believes the concern about discovery
261383 - reflects an incorrect expectation of how the SDS record would
261384 - be applied in arbitration. Will an actual arbitration occur,
261385 - and if so, will more harm than good come from the SDS record?
261386 - Finally, is it better to purge than to clarify?
261389 - ..
261390 - Analysis - Loyalty v. Integrity
261392 - A reasonable concern to protect the confidentiality of
261393 - management from discovery, is a legitimate State interest.
261394 - It is also important to discover problems and solutions in
261395 - order to avoid litigation and/or mitigate damages. Thus, as
261396 - with loyalty and integrity there is a balance to be struck
261397 - which parties of good will must endeavor to find every day.
261401 - ..
261402 - Murphy's Law - Slippery Slope of Ignoring Record
261403 - Purging Records Eliminates Intellectual Capital
261405 - Perfunctory deletion of the record on grounds that we do not
261406 - have time for careful analysis, leads to the slippery slope of
261407 - ignoring difficulty in the name of preserving confidentiality
261408 - and expediency, see for example on 920110. ref SDS 5 9482
Communication Manager Invests Time to Go to
Analysis Converts Information into
Slippery Slope Ignoring/Deleting Record,
Investing Intellectual Capital Leveraged by
Proactive Learning Discovry Analysis Insite
Com Manager Deliberates Organizational Memory Different Tasks from Tr
Facilitate Meetings Com Manager Comes Prepared
331001 - ..
331002 - Communication Manager/Scribe
331004 - The Com Manager is assigned to invest time crafting and editing
331005 - the record so the State can discover correlations and
331006 - implications which are not apparent from hasty consideration
331007 - within the time available to a busy executive or engineer. This
331008 - investment creates a resource of intellectual capital, also,
331009 - called organizational memory, history, knowledge, etc., which
331010 - affected parties can improve through reasoned editing in order
331011 - to discover the best course of action.
331013 - ..
331014 - Caution is urged to avoid the shortcut of hasty deletions; but
331015 - instead, develop alternatives and rationale showing how the
331016 - State's interests are best served. Deleting information rather
331017 - than investing time to craft context that shows the best course
331018 - was taken under the circumstances, then we are disarmed from
331019 - preparing for attack, and vulnerable to attack for having
331020 - failed to figure out a solution.
Failure to Perform, General Notice to Voith
Replace v. Retrofit, 920120
Substantial Completion Punch List
Submittals, complete review, 911118
380901 - ..
380902 - Results of York meeting:
380905 - Wayne said a transcript was not made from the meeting. I
380906 - encouraged the Department to prepare careful notes of what
380907 - transpired, similar to those prepared for the last meeting in
380908 - January. These notes, however, should cover all matters,
380909 - particularly positions Voith took on claims.
380911 - ..
380912 - Wayne advised that the meeting did not produce a clear indication
380913 - that Voith will perform. He said Voith adopted the position that
380914 - the Sep 3, 1991 Agreement over-rides the original contract terms.
380916 - ..
380917 - Voith "tendered" an offer to perform which DNRC and its advisers
380918 - seem to view as constraining the State's options.
380919 - ..
380920 - Voith's offer is analysed by Wayne's memo, ref DIP 1
380921 - 0000.
380924 - ..
380925 - I recommended that DNRC evaluate Voith strictly on performance.
380927 - Wayne advised that Sarah and he had dinner with Don McVitty in
380928 - DC, and evidently Don recommended DNRC fire Voith. I concurred
380929 - with that propostion, provided the Engineer first directs Voith
380930 - to do something by a date certain that Voith fails to do, so
380931 - DNRC can demand performance by Voith's bonding company.
380933 - ..
380934 - DNRC should go forward with Voith now only with stringent
380935 - oversight, per ref SDS 18 line 071022.
380938 - ..
380939 - Controlling the Record
380941 - I recommended that DNRC send a confirmation memo on the results of
380942 - the meeting immediately, so they are controlling the record. This
380943 - confirmation should list specific tasks Voith is to accomplish by
380944 - specific dates subject to termination.
380946 - ..
380947 - DNRC must cast what transpired in the context of DNRC's entitlement
380948 - and Voith's liability.
380952 - ..
380953 - Speed Increaser
380956 - Decision Matrix
380958 - Power produced this before the York meeting. Wayne said it was
380959 - submitted to Voith under some kind of "suggestion" situation.
380961 - I advised that the Engineer needs to "direct" Voith to
380962 - perform its contract, rather than "suggest."
380966 - ..
380967 - Punch List
380970 - Wayne said there was a full day devoted to this matter, which he
380971 - did not attend. He and Sarah went to DC to meet with McVitty and
380972 - Lamb.
380974 - ..
380975 - The parties evidently agreed that Voith must now go to the plant to
380976 - do the design for the corrections.
380978 - Voith will flounder on this the same as the other because there
380979 - is no budget.
380982 - ..
380983 - Transcript of Prior Meeting
380986 - Sarah reviewed this prior to the recent meeting in York, and
380987 - determined there was nothing to be concerned about.
380988 - ..
380989 - Comment
380991 - I think a written analysis of that transcript really needs to
380992 - be done. I believe Sarah is too close to the project to
380993 - evaluate it objectively, maybe Lamb or somebody else in whom
380994 - DNRC has confidence could take a look and give us a report.
380995 - This is an extensive piece of evidence.
380998 - ..
380999 - Review of Voith Submittals
381002 - Power did not review Voith's Subittals prior to the meeting in
381003 - York. We still do not know the status of this matter.
Company Property, CPU #6
Loan to DNRC to Evaluate SDS, 920304
Interim backup failed, 911027, 920325
Broadwater project management evaluation
April 30, 1992
420801 - ..
420802 - How should this be accomplished?
420805 - Wayne said they will decide this in a few days. He advised that
420806 - Walt wants CPU #6 for Broadwater project management. Wayne has
420807 - asked him for an explanation of how he would use it.
420809 - ..
420810 - Wayne needs Memo from Walt
420812 - This is another instance where the memo process could be applied
420813 - effectively to enable Walt to think through how he would apply a
420814 - computer with all of the capabilities of CPU #6.
420817 - ..
420818 - I explained the need to keep a machine in Wayne's hands, and that I
420819 - would be willing to buy him another machine, if that is what it
420820 - takes to do this.
420822 - ..
420823 - Wayne said something about getting through to the end of the year
420824 - when a new budget cycle might make it feasible to get another
420825 - computer for Walt.
420829 - ..
420830 - Repair Tape Drive
420833 - If I come up to work on claims, I will fix the tape drive.
420836 - ..
420837 - Windows 3.1
420840 - We experimented with this on-line, and Wayne found it works okay. I
420841 - explained how it enables him to access simultaneously information
420842 - from Walt, Mike, me and himself, and we experimented so he could
420843 - see how he can switch smoothly between these different data bases.
420848 - ..
4211 - Memory and Mouse
421201 - Do they need these on the DNRC computer?
421203 - Wayne is not sure about this. He will inquire.
421207 - ..
4215 - SDS Update
421601 - I advised Wayne of the updated SDS code per ref SDS 20 line 091001.
Company Property, Scanner
Scanner, HP & OmniPage OCR software
SDS support for DNRC (network)
Develop Record System
4709 - ..
470901 - Efforts to evaluate this matter or return the scanner.
470903 - We did not discuss this per se. I have in mind that if I return to
470904 - Helena, I will wind up doing this. We have to bring up the system
470905 - one step at a time so they can absorb it and see the value.
470907 - Wayne asked if I have downloaded Windows 3.1 onto the DNRC
470908 - computer, and I explained this first requires downloading
470909 - pcAnywhere onto that machine. Mike was going to do it, but has not
470910 - been able to because the Power people are using the computer and
470911 - he evidently feels he cannot use it for 10 minutes.
470913 - Wayne said he will try to copy the pcAnywhere code to the
470914 - project computer. Then we have to figure out how to get it
470915 - booted each day, on and off, so the phone line is available
470916 - during the night.
470918 - ..
470919 - Power is still working on entering the project documents to the
470920 - log system Power has created.
470922 - It is not clear what benefits have derived from the system so
470923 - far, but Wayne has previously indicated Walt feels it has been
470924 - helpful.
470928 - ..
470929 - He said Walt has asked to get CPU #6 for project management.
470931 - This would be fine, if Walt uses SDS to capture the record. But
470932 - so far they seem to be continuing the debate about the merits of
470933 - this idea. Actually, it would work out great if Walt would
470934 - capture the record, so it is available for Wayne in a network.
470935 - This is my main objective, to get them all working together
470936 - smoothly, so Wayne does not feel so burdened to create all of the
470937 - record himself.
470938 - ..
470939 - I reminded Wayne of Mike's Sims's offer to install the
470940 - wiring for the network in the eveing so no one is disturbed.
470942 - ..
470943 - In any case we need to get another machine for Walt, so Wayne can
470944 - continue his work with SDS. I offered to do this, if there is
470945 - another 2 months work for me. I explained my strong interest in
470946 - taking every possible step to help DNRC succeed with SDS.
470948 - Actually I wonder why yet another machine is needed? Why
470949 - can't Walt use the DNRC project computer?
470952 - ..
470953 - Wayne has not installed the ethernet card in CPU #6. He is
470954 - waiting until they actually buy it.
Company Property, Scanner
SDS support for DNRC (network)
5006 - ..
500601 - Review matters at ref SDS 18 line 100901.
500603 - I did not have time to discuss difficulties with Wayne's SDS doc
500604 - log entries.
500607 - ..
500608 - Mentioned my discussion with Karen, ref SDS 19. Somehow a careful
500609 - analysis needs to occur on implementation.
500611 - Wayne said she is out of town for the next week or so. He will
500612 - try to raise it with her.
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