ADVANCED ENGINEERING PROJECT MANAGEMENT

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ADVANCED ENGINEERING PROJECT MANAGEMENT

Background

Because you have performed very well in your project review task, you have been recently appointed to a position as a program manager in an organisation that provides project management services in planning, designing and implementing engineering projects. The projects for which the organisation provides its services encompass all disciplines of engineering, plus related disciplines like construction and asset management.

Your main responsibility is the management of a program of approximately six (6) engineering projects in your organisation. You have just taken over this program, and are keen to make a favourable impression to the company’s Board of Directors.

Three (3) of the six (6) projects in this program are progressing well towards a satisfactory result. The remaining three (3) projects, Project A, Project B and Project C require attention.

The information given below about each project is an outline only. You are expected to develop additional details about each project as part of your answer, and for each project nominate an example project (for example, a suitable development project for Project A) for which to develop your answers. Further information is in sub-questions 1 and 2 of Question 1(a).

Project A

Project A is the development of a specialised facility, of about $4 million in value, of approximately

18 months’ planned duration. It is 35 per cent completed. Earned Value analysis shows that the project is not achieving its planned cost or progress targets. Installation of the project is also not achieving quality requirements.

One of the principal reasons for the delay in the development of the facility is that it uses a number of specialised components that are only obtainable from selected overseas suppliers. Some of these components must be delivered on time to maintain the project’s expected delivery schedule. For a number of reasons, there was a delay in ordering these components. This delay has been exacerbated by industrial disputes in the supplier organisations and a long-running maritime dispute that threatens to delay their delivery.

There are also a number of other risks associated with this project. There was initially only a quite basic business case, rudimentary project charter, and a poor definition of expected project outcomes. There are also considerable exchange rate risks associated with any delays and the potential for a competitor to enter your client’s market should the facility not be completed within a reasonable period of time.

Project B

Project B is a major engineering development, which is about $20 million in value and is expected to take about four years from the start of planning to final completion. Your firm has been appointed by the developer of this project to manage the planning, design and delivery of this project. At the moment, the planning phase of this project, which is expected to take about 12 months, is 50 per cent complete. While the project is currently progressing well in terms of time, cost and quality, there are a number of sustainability and stakeholder management issues with it.

The development has been adjacent to a rural residential area near a large city, which is highly desirable and attracts high property prices. The residents attracted to this area are concerned about noise and traffic during from the proposed development and are passionate about their environment

and the beauty of this area. They have formed a Citizen’s Action Group that is well connected and is actively campaigning against this development and for the preservation of the habitat of a rare wallaby species that is native to the area planned for the development. Therefore, even though the proposed development is expected to be a positive addition to the city and will employ many people who live there, there is considerable and well-organised opposition to it in this particular location.

Mindful that similar well organised actions by residents with respect to other projects has in a number of cases prevented the development from occurring, the client has entertained the option of moving the project some 10 kilometres further from the city. This option will cost an estimated $2.0 million more to develop than the planned development as it requires considerably more earthworks, development of new utility facilities and will require the development of a good access road.

Project C

Project C is a small (about $1.5 million in value) but complex internal project that has as its purpose the development of a new contract tendering, offer and management system that your organisations can use to facilitate the tendering process for projects and use to facilitate the letting and management of contracts for client organisations.

This system is quite complex and has a number of interrelated components. While it is being managed by staff of your organisation, there are a number of independent business analysts and software experts assisting with its development. They have been working to their own understanding of requirements of the sub-systems for which they are responsible, and have been given only a basic understanding of the interfaces between their developments and the other components of the system. There is considerable work required to further develop those interfaces.

These issues have been complicated by differences between the development staff and organisational management about the direction of the project, and by numerous requests by senior management of your organisation for scope and functional changes. The process for controlling, managing and implementing changes has also been poor.

As there is at least one competitor to your organisation known to be developing a similar system, it is essential that your organisation completes the development of this system in a timely manner.

Your Organisation

The Board of Directors of your new organisation has recently changed. The new Board has decided that the organisation should develop a more focused strategic direction, and wishes to focus on

projects with strong business cases, well defined project charters and very clear objectives that must be

agreed to by key stakeholders. All projects must be very closely aligned to the engineering disciplines represented in the organisation. There is a strong focus on minimising risks to the organisation and on effective communication in all projects. In addition, there is a strong focus on project completion. The Board is committed to completion of existing projects, and will provide the necessary resources to compete these projects, even at a potential loss, in order to maintain and build its client base. It wants to be prudent in the way that it manages its projects, and to build a platform for a successful future.

The Board therefore urgently requires that you review these projects and present a report on what steps you will take to ensure that all three projects that require attention will be completed on time and to

the required quality. Losses are to be minimised. Internal projects are to be carefully scrutinised to see

whether they should be outsourced if that is a better option.

You are accordingly required to undertake a review of all three (3) projects to ascertain whether they fit the organisation’s new strategic direction and what action should be taken given the potential risks associated with them.