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Subject Code INF70005 Subject Title Subject Title bject Title Strategic Project Management
Lecturer’s Name Dr Bill Young
Title or Topic Addressed Denver International Airport Project
Due Date 20 March2017 Date Received 19 March 2017
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Student Signature(s) Chitra MARKER’S MAIN COMMENTS
Marker’s Signature Date Grade/Mark INF70005
STRATEGIC PROJECT MANAGEMENT
Assignment value 30 %
DENVER INTERNATIONAL AIRPORT
SummaryThe project is about Denver International Airport which is an symbol for the economic growth in Colorado .The report contains detailed explanation of expectations from the airport, what are the risks it had gone through, what was the impact of the risks on the airport and the how much it effected the budget .The criteria which has made the project a failure and a discussion about the standard criteria. The other recommendations which need to be taken in the future for consideration to with come all these risks and make the project a success.
TOC o “1-3” h z u STUDENT(S) DETAILS PAGEREF _Toc477711234 h 1Summary PAGEREF _Toc477711235 h 3Denver International Airport PAGEREF _Toc477711236 h 5Introduction PAGEREF _Toc477711237 h 5Background PAGEREF _Toc477711238 h 5Criteria PAGEREF _Toc477711239 h 7Standard Criteria PAGEREF _Toc477711240 h 7Critical Identification and Justification PAGEREF _Toc477711241 h 8Conclusion PAGEREF _Toc477711242 h 9Recommendations PAGEREF _Toc477711243 h 9References PAGEREF _Toc477711244 h 10
Denver International AirportIntroductionDenver international airport is owned and operated by the “City and County Denver , Department of Aviation” .Denver International Airport is also referred as “DIA” .Denver International Airport is the replacement of the Stapleton airport which has been serving since 1929.The project has been expected to be an architectural structure but due to its delay in opening ,over budget and deviation from the original plan the project has been considered as a failure .Further , we will know the details of the project.
BackgroundDenver International Airport is the replacement of Stapleton International Airport which has been serving since 1920’s, as it got many issues to handle to provide better services to passengers. Stapleton International Airport was built to serve approximately 9 million passengers per year as the usage of airport increased there has been some extension to the airport to serve approximately 15 million passengers per year during the period 1960’s and 1970’s and it served those many passengers between 1978-1979.After that, the number of passenger have been gradually doubled as it was the only major airport available in that area at that time.
The usage of Stapleton airport gradually more than the other airports in United States .Thus, it has been burdened with the large number of passengers and there are other technical issues like as there is no provision for another addition of jets to consider the airport, runways doesn’t have enough space thus it causes too much of waiting time during bad weather, there has been some complaints about the noises made by the aircrafts by the nearest park hill community and there is no enough space to extend the Stapleton airport as there are some legal threats near rocky mountains. Along with handling these issues and the City and County Denver want to start a modernized airport with automated baggage system.
By starting the Denver international airport, the City and County Denver was not only expecting that it provides great business, economic growth but also it will be the great architectural element for the area with a structure in it.
The Decisions which are made by the team for the cause of failure
In Nov 1989 the project has been started. In Oct 1990 Breier Neidle Patrone has be called to give a practical solution for automated baggage system but due to its complexity it is impossible to make a practical solution.
In June 1991 United Airlines has decide to contact the BAE Systems as it was the leading company to deal with the automated baggage system.
By summer 1991, the Airport project management has recognised that the automated baggage system should be needed by the entire airport .So; the bids have been called for handling it. They got only 3 bids but those 3 are also rejected as no one can complete the task within the time. So they contacted BAE to take the contract and make an integrated automated baggage system for all the concourses in April 1992.
In Aug 1992, united airlines have changed its plan as it cuts the system for transferring the bags to the aircraft and they requested system for handling gigantic baggage and to create a dedicated ski-equipment for handling area. In Sep 1992 the continental has also wished for ski-equipment for handling area.
The original opening of the airport has been scheduled on 31 Oct 1993 due to all the changes from the airlines it has been moved to 19 Dec 1993 .But again the date has been shifted 9 March 1994.
In Jan 1994 united airlines again made changes to the oversize baggage system.
In the meantime the airport authority wanted to show the working of the automated baggage system so it arranged a press meet and it has been a disaster as the systems are not functioning properly. Due to this the Mayor declared unspecified delay.
At last, the airport officials decided to make the manual baggage handling system and gave the contract to the Fentress. DIA has started finally on 24 February 1995 with many changes in the project than the initial plan. But now it is one of the busiest airports in the world and fifth busiest in the United States and it is also been considered as one of the busiest airline hub in the world’s aircraft market. The airport now solely makes the revenue or economic growth of $26 billion for the state of Colorado.
Fig1.Automated Baggage System and conveyer belts
Fig 2.Denver International Airport
CriteriaStandard CriteriaCriteria means how the project has been dealt and taking this into consideration we can decide whether a project can be a success or failure .The two stages where we can analyse whether the project is success or failure are delivery stage or at the end of completion stage and after completion stage. Any project can be a failure, a success or both of them. From, more than 50 years the factors that influence the criteria are cost, time and quality. So these factors have been considered as an “Iron Triangle”. There have been many studies going on what are the other important criteria which are needed to be included with the iron triangle.
The cost, time are the external points which can be known by anyone and analyse the status of the project. But some type of errors can only know by the project management while dealing each and every stage. Some errors can be known directly and some cannot be known directly or can be known after the completion and during the testing. During the delivery stage the team can tell whether the project is going in the time period and going in the planned budget or not. But if the project includes system life cycle then these are the secondary things and the primary thing will be the quality of the systems and there performance which will tell whether the outcome is favourable to the customer or not .After the delivery, the success is known solely by the performance of the systems or by the revenue made by the whole project.
Presently, the companies have been adopting criteria which is six sigma and the critical success factors which are a little bit more detailed criteria which should be followed by other companies in developing their projects. This six sigma CSF’s has a different type of impact on the project as the critical factors of success would give a great project management team which is knowledgeable by the training and including all the qualities which need to be in the person to be qualified to be in the team for the particular projects as different projects have different needs and different technologies.
Critical Identification and JustificationThe criteria which imply the present case is the iron triangle and the factors are cost, time and quality. These are the factors which have to study properly to get an overview of DIA failures. But these all happened due to lack of planning, lack of knowledge as the automated system is the new system which is being implemented for the whole airport. The airport authority or the engineers handling the project should be alert even before the designing it as it is the most complicated system .As the system has never been developed before and the engineers cannot identify the risk in each step.
Even the design of the airport has been done by many engineers as the time bound is crucial thing and the designs of airport would take time and money if the quality is required and the airport has to be working for years. Thus, there have been many changes made for the terminal plan, floor plan.
Cost: The project has been started with an overview of $1.2 billion and the project has been completed with an overall budget of $ 5 million dollars and with all these the maintenance of airport costs $1 million per month. The finance of this project has been done by keeping the bonds of the property and because of recession they got a nice value but still the project has gone over the budget.
Time: The original opening of the airport has been scheduled on 31 Oct 1993 due to all the changes from the airlines it has been moved to 19 Dec 1993 .But again the date has been shifted 9 March 1994. The 9 march 1994 has also been postponed to 15 May 1994 due to issue of electrical supply and solve this issue they need install industrial fillers into the electrical system which might take several months.
Quality: In May 1994, Log plan consulting has been involved to assess the project. BAE has denied about the malfunctioning of systems and said that airport people have been using incorrectly. From then, onwards the airport has been charging BAE $12K per day for further delays from Aug 1994.
But the cause of all these is the Lack of Planning, no proper knowledge, no proper design for the entire project and lack of risk management skills.
The DIA project has been a great failure with $5 billion budget and 2 years over the initial opening time .The main fault is on the project management as there is no proper planning. The following decisions will give us an idea how there is no planning about the project.
The airport officials have given the grant to airlines to make their own baggage system without considering the complications.
Then again changing the strategy for integrated system after a year of work and the request of change is understandable but why they had gone through the process as there is no sufficient time to finish the project and why BAE have given the commitment to complete the work on time and in budget even after changes made.
Even after the proceeding with these the airlines requested for ski equipment and airport officials have granted even knowing that there is no sufficient time.
There is no communication with stakeholders and did there no changes to the plan.
These sudden changes in each step have made the project to go over time and budget.
ConclusionDenver international Airport project is a big Failure by considering the factors such as cost, time and quality. The project management team should be careful and attentive while dealing with the risks involved in each stage and step in such a big project. In this project from the initial stage itself there have been many risks involved. The project started without any consideration of them and without any strategy to overcome them.
There is lack of communication, planning, proper strategy to continue in every step, no proper design no knowledge about the new system.
The project management team should have the knowledge of what they are getting involved in to. The team has already known by the analysis done on the baggage system that it is complicated. There has been no proper management team and risk assessment team from the initial stage of the project the DIA has been a failure .But in the future because of its revenue it will be a Success City and County, Denver.
RecommendationsBy this project we can know that for a project to be success is to know how to deal with the project properly so that the work can be finished on time. The project management team should be efficient and knowledgeable on what they are working. In future if they want to implement to the automated baggage system then the necessary risk management they need to take is that it takes a lot of time in successfully running such a huge automated system, before starting the layout the performance and the design of these devices should be thoroughly checked so it can avoid some of the risks. There should be a backup while planning complicated systems. Thus, the systems should be adapted after the systems are thoroughly studied by the researchers.
ReferencesAtkinson, R 1999, Project Management: Cost, time and Quality, two best guesses and a phenomenon, it’s time to accept other success criteria, International Journal of Project Management, Vol.17, no.6, pp.337-342. ;https://notendur.hi.is/vio1/Project_management_Cost_time_and_quality.pdf;.
Calleam Consulting Ltd- Why Technology projects Fail, 2008, ‘Case-Study- Denver International Airport Baggage Handling System – An illustration of ineffectual decision making’, viewed on 12-03-2017. ; http://calleam.com/WTPF/wp-content/uploads/articles/DIABaggage.pdf;.
Cleland, Dl and Ireland, LR 2004, Project Manager’s portable handbook, 2nd edition, McGraw-Hill, New York. Coronado, RB and Antony, J 2002, ‘Critical success factors for the successful implementation of six sigma projects in organisation’, The TQM Magazine, vol. 14 no. 2, pp.92-99.< http://cdn.intechopen.com/pdfs/11583/InTech-A_comprehensive_framework_for_six_sigma_critical _ success_factors_with_an_experience_on_a_developing_country.pdf>.
Dr. Richard de Neufville, 2008, ‘The Baggage System at Denver: Prospects and Lessons’ viewed on 16-03-2017. < http://ardent.mit.edu/airports/ASP_papers/Bag%20System%20at%20Denver.PDF>.
Denver International Airport <http://www.auburn.edu/~landrwh/project_management/ files/cases/Kerzner/Denver%20International%20Airport.pdf>.
Michael G. Miller, 1988, ‘New Denver Airport Replacing Stapleton international Denver, Colorado’, viewed on 17-03-2017.
Michael Schloh, 1996, ‘Analysis of the Denver International Airport Baggage System’, viewed on 15-03-2017. < https://www5.in.tum.de/~huckle/schloh_DIA.pdf>.
Revolvy < https://www.revolvy.com/main/index.php?s=Stapleton%20International%20Airport>.