Case Study: ‘Blue Spider (BS) Project.’
Executive Summary
The purpose of this report is to assess the Case Study: ‘Blue Spider (BS) Project’ and identify several issues that had an impact on the performance of the project from the first to the last phase of the project life cycle. The BS project is the Phase 1 of a $500 million program that is expected to take more than 20 years. The project was awarded to Lord Industries, which in turn awarded a contract worth $2.2 million to Parks Corporation and it is expected to run for ten months. The role of Parks Corporation in this project is to develop a new material that meets certain specification. Undertaking such a project requires the company to commit a lot of its resources in terms of people, finances and time. There is also the need to maintain a proper relationship with the customer. The appraisal of the BS project reveals that it has faced more challenges than successes. The contractor had to deal with different kinds of risks and experienced communication problems that hindered smooth implementation of the project. The contractor also made a poor choice for the program manager. These primary challenges led to other issues such as lack of trust and unethical practices. The BS Project provides lessons for areas that businesses and program managers should focus on to achieve effective program management. These include the need to handle risks appropriately, the significance of managing diverse communication need of the stakeholders and essential qualities of a good program manager. Recommendations provide that companies such as Parks Corporation should introduce training programs for their program managers to equip them with the essential skills. They should also develop a communication plan that will enhance relationships with diverse stakeholders.
Table of Contents
Case Study: ‘Blue Spider (BS) Project’ 3
Risks at the Initiation Stage. 4
Risks at Implementation Stage. 5
Communication Management issues with Major Stakeholders. 6
Selecting the Project Manager 6
Trust Issues with the Customer 7
Case Study: ‘Blue Spider (BS) Project.’
Introduction
Project management is described as the process of applying certain courses of action, methods, experience and expertise to attain the objectives of a specific project. A project may be well conceived, have access to adequate funds and the necessary technical knowledge. However, the inability to skillfully coordinate and manage the efforts of all participants can lead to a higher budget, inability to deliver within schedules or attainment of poor functional and technical quality. The overall management function of a project becomes critical when a project is large or complex (Meunier, Quinet & Quinet, 2014). This report focuses on the Blue Spider (BS) Project to identify different kind of issues that could affect its performance. The main contractor for this Project is Lord Industries who subcontracts the Phase 1 of the project to Parks Corporation. The project has risks in all its phases that have been handled in various ways. It also has issues related to management of communication, selection of project manager, customer’s reduced level of trust, selection of the best contract type and ethical issues. The first segment of the report is a project appraisal which discusses the issues mentioned above. The second segment is a conclusion which provides the lessons learned from this case study and recommendations for having a better performance in project management.
Project Appraisal
Management of Risks
Risks are any uncertain events or conditions that are likely to have an impact on a project. Risks can be handled in four basic ways that include avoiding, mitigating, transferring and accepting (Blaskovics 2016). The BS project encountered different risks throughout its lifecycle that were handled in a variety of ways.
Risks at the Initiation Stage
At this stage, Parks Corporation was preparing a proposal that would help in winning the contract for the BS Project. Parks had the risk of failing to meet the criteria that would determine the selection of BS Project’s subcontractor. Lord Industries was looking for a company that could offer a low bid, possess technical expertise and a good management performance in past projects. Parks avoided this risk since it satisfied all the set criteria. The subcontractor had the necessary technical expertise and management performance. Secondly, Parks had the risk of failing to satisfy the requirements for operating the design material. The designs needed to be operated at temperatures that ranged from -65oF to 145oF but Parks could not function at temperatures above 130oF. In this case, Parks tried to mitigate the risk by deceiving the customer that its design specifications could operate at temperatures of up to 155oF.Deceiving the customer could lead to other risks for the project (Blaskovics 2016).
Risks at Planning Phase
The activities performed during this phase involved getting together a team that would be working on the project. The project had a risk of getting the right project manager who could lead the project team and getting people with the required technical skills. In the selection of project manager, the Director of Engineering tried to mitigate this risk by getting a person who had worked with the company for many years and who had adequate technical skills. He also briefed the project manager about what was required of him. The risk of getting the right people on the team was mitigated with the help of the Director of Engineering who used his undue influence to get the best people (Blaskovics 2016).
Risks at Implementation Stage
Activities carried out in this stage involved developing and testing the material that could meet specification requirements of the project. It was also necessary to motivate staff and achieve certain milestones that would ensure the project was within schedule. It was also necessary to communicates with the client and other members of the team to give them updates on the progress of the project. Parks faced the risk of failure in the test matrix, which was mitigated by developing a new material that would meet the set requirements. Secondly, Parks faced the risk of changing the scope of the project which could increase its costs. The contractor planned to mitigate the risk by preparing a trade-off analysis to identify what could be removed from the project at later stages. Customer risk that involved Parks failure to communicate effectively was handled by increasing the number of meetings and reports that needed to be prepared and handled over to the client. The risk of being within schedule was mitigated by rescheduling some takes and having people work overtime (Blaskovics 2016).
Risks at Closeout Phase
BS Project risk at this stage entailed the lack of funds to bring the project to completion. This was handled by requesting for more funds from top management. The Project also had the risk of developing a material that did not meet specifications of lasting more than five years. More tests were to be conducted on the developed material to confirm the first test results (Blaskovics 2016).
Communication Management issues with Major Stakeholders
The BS Project had various stakeholders who were mainly individuals with an interest in the project or could be affected by its performance either directly or indirectly. The major stakeholders in this project included the Lord Industries- the customer, Project Manager, Chief Project Engineer, Director of Engineering, Director of Program Management, Production Manager, Department Manager and Testing Engineer. Communication management issues occurred between these stakeholders, which contributed to other problems. The issues involved delaying communication from the project manager to the customer and providing false information to the customer and other team members. Other related issues are hiding details about the differences in expectations, failing to give stakeholders information about how the project is progressing and waiting until the last minute to provide important details on time to ensure important decisions are based on them (Zulch 2014).
Selecting the Project Manager
Parks Corporation did not select an appropriate Project Manager (PM) for BS Project since he had low influence over team members, lacked experience in project management experience and did not receive any training for this role. The selected PM did not possess the most critical attributes that could have helped in the proper management of BS project. Project managers should possess six essential skills that include communication, leadership, negotiation, team management, personal organization and risk management.
Communication skills are necessary because PMs spend 90% of the project’s time in communication. PMs are required to convey ideas, issues, goals and vision in an effective manner. They are also required to produce reports and give presentations (Săvescu & Budală 2016). Besides having highly developed technical skills, managers need to have leadership skills that can enable them to deliver. Having the right leadership skills enables the PM to motivate the project team and achieve desired outcomes due to increased support from team members (Ning 2017). Negotiation skills are used to negotiate budgets, resources, scope, schedules among others. Personal organization is also necessary since it ensures that the PMs can organize their life and this demonstrates that they can organize other people. As a good team manager, the PM can administer, coordinate teams by encouraging teamwork, tasks delegation, resolving conflict, creating goals and evaluating performance. Risk management skills will enable a PM to predict and develop solutions to problems before they arise, increasing the chances of delivering projects successfully. The selected PM for BS project lacks these essential skills (Săvescu & Budală 2016).
Trust Issues with the Customer
The contractor and the customer had a problem of mistrust that was caused by Parks consistent behavior of failing to provide reports on time. This increased doubts on the side of the customer about Parks Corporation capability to deliver the project according to specification. The customer was always receiving delayed details that also turned out to be different from its expectations. Before the PM first meeting with the customer, it was tough to get access to the PM. The PM did not present data to the client three days before the meeting as required to give them more time for review. Following this communication problem, the customer established an office at Parks to scrutinize the project’s work more closely. They also demanded for more meeting and minutes prepared by the PM. In the second meeting, the PM presented information for new material on the day of the meeting. This heightened the communication problem and created trust issues. The customer could not understand why the contractor failed to present the data for the new material about three days before the meeting. As a result, the customer decided to introduce the policy that it applied to other contractors. The policy required them to have interchange meetings almost every week. Therefore, mistrust can arise from communication management problems and this further strain the relationship between the two parties. The customer becomes strict, threatens to withdraw the project and introduces more rules (Sato & Gnanaratnam 2014).
Types of Contract
Parks Corporation decided to choose the Firm Fixed Price (FFP) contract because it clearly defines the scope of work in a project. It could also increase the chances of receiving bids since the customer does not end up sharing any additional costs that were incurred beyond the scope of the project. This type of contract requires the customer to pay a fixed fee, and the contractor has to use the agreed costs and period to see the project to its completion. This implies that the contractor will pay for additional costs incurred outside the scope of work. The FFP contract in this case study required Lord Industries to pay $2.2 million for the project and Parks to complete it within ten months. The parties could also have agreed to use a different kind of contact such as Fixed-Price Incentive Fee Contract (FPIF). This contract could be appropriate is the scope of work was not known, and the customer is ready to share the risk with the contractor. This contract type provides a fixed price, and a bonus is provided based on performance (Joslin & Muller 2016).
Ethical Issues
The BS Project faced ethical issues that were mainly related to providing false information. In the initiation stage, the contractor handled the risk of failing to meet specification by lying to the customer. This was meant to ensure that Parks Corporation was awarded the project. Later, Parks would push the client to make appropriate adjustments in these requirements. This was unethical because it forced the client to make an important decision based on lies. At the implementation stage, the contractor planned to lie to the customer that the scope of the project had not changed due to the development of new materials. Parks intended to tell the customer that it had used its money to come up with the new material. This was unethical because the contractor has a moral obligation to ensure the interests of the customers are taken care of in the right manner. At the closeout stage, the PM decided to hide the tests for the new material to ensure that he did not get into trouble. This was unethical because it was likely to result in bigger problems in the future that could have been prevented by telling the truth soon enough (Wang, Keil, Oh, & Shen 2017).
Project Evaluation
| Initiation stage | Planning stage | Implementation stage | Closeout phase | Average | |
| Scope management | 5 | 5 | 1 | 2 | 13 |
| Time management | 5 | 4 | 1 | 2 | 12 |
| Resource management (human resource) | 5 | 4 | 1 | 1 | 11 |
| Communication management | 4 | 4 | 1 | 1 | 10 |
| Stakeholder management | 4 | 4 | 1 | 1 | 10 |
| Risk management | 3 | 3 | 1 | 1 | 8 |
| Contract and procurement management | 5 | 4 | 2 | 2 | 13 |
Conclusion
Lessons
The BS Project provides different lessons that are useful for organizations that are in the process of engaging in a new project. It provides some important considerations that should be made when working on a project from initiation stage to closing phase. First, there are different ways of managing risks in a project, and it is important to select the approach that will help in ensuring that the risk will not affect the performance of the project. Secondly, projects are comprised of diverse stakeholders with diverse communication needs. Hence, it is necessary to establish a communication plan that will be used to satisfy information needs of these stakeholders. Thirdly, the success of a project is largely determined by the kind of PM who is working on the project. Failure to select a good PM with the right skills and qualities will lead to issues arising from different areas of the project. Another lesson is that a contractor can erode the level of trust that customers have on them by delaying to communicate important information or deceiving them, and this leads to a harsh relationship between them. Moreover, organizations should also avoid engaging in unethical practices such as lying to the customer since this will damage their reputation.
Recommendations
Parks Corporation should introduce a training program that can be used to train new project managers on what they are required to do in project management. Frequent training of project managers should also be conducted frequently to ensure that they stay updated about any new issues that are cropping up in project management. Another recommendation is to ensure that a communication plan is a key component of a project in the planning phase. Such a plan will be useful in preventing that different kind of problems that may happen with stakeholders. Efficient communication management will deal with trust issues, ethical problems and provide an avenue that stakeholders can use to provide suggestions for improving the project of overcoming challenges faced by the project (Joslin & Muller 2016).
Blaskovics, B 2016, ‘The impact of project manager on project success–the case of ICT sector,’ Society and Economy, no. 2, p. 261. Available from: 10.1556/204.2016.38.2.7. [27 May 2017].
Joslin, R, & Muller, R 2016, ‘The relationship between project governance and project success,’ International Journal of Project Management, no. 4, p. 613. Available from: 10.1016/j.ijproman.2016.01.008. [27 May 2017].
Meunier, D, Quinet, A, & Quinet, E 2014, ‘Project Appraisal and Long Term Strategic Vision,’ Transportation Research Procedia, vol. 1, no. Planning for the future of transport: challenges, methods, analysis, and impacts – 41st European Transport Conference Selected Proceedings, pp. 67-76. Available from: 10.1016/j.trpro.2014.07.008. [27 May 2017].
Ning, Y 2017, ‘Selecting client’s project control strategies in person-to-organization transactions,’ International Journal of Project Management, vol. 35, pp. 212-220. Available from: 10.1016/j.ijproman.2016.11.003. [27 May 2017].
Sato, CY, & Gnanaratnam, AS 2014, ‘The differences between an internal and external project manager,’ Revista de Gestao e Projetos, no. 2, p. 1. Available from: 10.5585/gep.v5i2.264. [27 May 2017].
Săvescu, D, & Budală, A 2016, ‘Some Aspects Regarding Communication In Project Management,’ Annals of the Oradea University: Fascicle Management and Technological Engineering, Vol XXV (XV) (2016).
Wang, J, Keil, M, Oh, L, & Shen, Y 2017, ‘Impacts of organizational commitment, interpersonal closeness, and Confucian ethics on willingness to report bad news in software projects,’ The Journal of Systems and Software, p. 220. Available from: 10.1016/j.jss.2016.12.004. [27 May 2017].
Zulch, B 2014, ‘Leadership Communication in Project Management,’ Procedia – Social and Behavioral Sciences, vol. 119, no. Selected papers from the 27th IPMA (International Project Management Association), World Congress, Dubrovnik, Croatia, 2013, pp. 172-181. Available from: 10.1016/j.sbspro.2014.03.021. [27 May 2017].