The Channel Tunnel: an Analysis - Essay Example

The Channel Tunnel: An Analysis I. Introduction Joining Britain and France with only 34 kilometres between them was only a dream in the 1800s, but in 1994, it finally became reality. Above-ground conditions between these two countries are not exactly friendly so that only underground avenues had to be exploited to serve the purpose of a railway. Geologists found a chalk marl beneath sea level which was strong enough to sustain a metallic tunnel1 and engineers thought they could do it. The Channel Tunnel, popularly nicknamed the Chunnel in English, is a 50-km-long rail tunnel beneath the English Channel at the Straits of Dover, connecting Cheriton in Kent, United Kingdom, and Coquelles near Calais in northern France. The tunnel was said to be officially opened by Queen Elizabeth II and French President Francois Mitterrand in a ceremony held in Calais on May 6, 1994. Eurostar trains now travel at high speeds in France and upon the Channel Tunnel Rail Link, where the tracks are modern and custom-made for the standard cruising speed of 300 km/h.2 The Channel tunnel has been declared by the American Society of Civil Engineers to be one of the Seven Wonders of the Modern World.3 However, the venture was not without many hassles. In fact, the construction had faced a stop-gap measure with at least three attempts at construction - non-construction. This may be perceived as normal among gargantuan projects, considering its capital cost of nearly 5 billion,4 its period of construction stretching so many years with several interruptions, and with intricacies primarily from its character of being below ground and even below sea-level. It is said, all significant human undertakings can be viewed as projects and that some have more successful outcomes than others. Channel Tunnel in this paper is examined using the project management approach.5 Particularly, it shall look into the "how" of project delivery, examining process. Evaluating the project management allows learning from its successes and mistakes. According to Hendrickson6, professional construction management is usually used when a project is very large or complex. Channel Tunnel may be analysed against the backdrop of professional construction management, too. II. Channel Tunnel A. The project. The Channel Tunnel, also known as 'Euro-tunnel' or 'Chunnel', is a series of three tunnels - two carrying and one service tunnel - linking England to France. The longest undersea tunnel system in the world, the tunnels are 50km long, with an undersea section of 39 km.7 It has a smaller access and emergency evacuation tunnel between them, and through the chalk marl beneath the water,8 it runs underground under the English Channel.9 Through over seven years, 15,000 workers dug for the tunnel from both ends simultaneously. The prime contractor for the construction was the Anglo-French TransManche Link (TML), a consortium of ten construction companies and five banks of the two countries. 10 At that time, this was Europe's most prestigious engineering project. The tunnels were lined with precast concrete segments and, where considered necessary, with cast iron. Linked by cross-passages, the service tunnel provides ventilation and enables access for evacuation in emergency situations. In addition, the tunnels contain cooling pipes, fire-fighting mains, drainage pipes, ventilation equipment, signalling and communication systems and extensive monitoring and control systems. 11 On each side of the Channel, two major terminals were built and linked directly to the respective national road and motorway networks. The road vehicles are carried on shuttles which operate on a loop system between the two terminals. Through-trains directly between London, Paris and Brussels Passengers and freight, passengers are carried on at speeds up to the maximum allowable of 130 km/h.12 B. The business case. By the definition of the Office of Government Commerce (OGC) of the United Kingdom, Channel Tunnel would be more of a program than a project because it is a component of so many projects.13 With a complex project like this, involving two countries with political concerns yet to consider, the matter of a business case is likewise too complex. In fact, as Hendrickson14 said, one characteristic of mega-projects is that the overall organizational approach for the project will change as the project advances, therefore, it is important to recognize the changing nature of the organizational structure as a project is carried out in various stages. What Hendrickson means is that the "functional" organization may change to a "matrix" which may change to a "project" organization, and not necessarily in this order. There is fluidity, therefore, that it is hard to case it. Nevertheless, as a project that has gone implemented and operational, the social, financial, environmental, and economic aspects of Channel Tunnel are hereby presented, considering the past and present. Social aspect. Historically, cross-Channel traffic had increased so much that, even with a severely reduced share of the market, ferry companies welcome the Channel Tunnel as "a challenge we can live with." Beyond Kent in Britain, a fixed link was viewed as a good thing by business in general, and by the construction industry in particular, which consistently lobbied the government in its behalf. Finally, it is said the Thatcher government had much larger motives in supporting the project.15 . Symbolically, Channel Tunnel would be a means to further integrate Britain into the expanding economy of the European Community. Also, the Channel Tunnel project offered a highly visible means of proving the superior efficiency and effectiveness of the private sector over the public sector.16 On the French side of the Channel, not only do the French have a long-standing tradition of supporting large infrastructure projects, and the Tunnel itself blends well with their already successful rapid train system, Train a Grande Vitesse (TGV). Moreover, the French saw the project as a means of promoting development in its economically depressed Nord Pas-de-Calais region. This area, dependent so much on the declining coal, steel, and textile industries, had lost more than 130,000 jobs between 1975 and 1984.17 With these conditions, the Channel Tunnel was most welcome. Financial aspect. This English and French venture, with a 55-year concession granted to Eurotunnel, began with the signing of the Channel Tunnel Treaty between the two countries in 1986 but passenger service began in 1994.18 It is the largest privately financed engineering project in history.19 The Euro-tunnel project was privately financed and continues to be privately operated. The estimated 4.9 billion total cost of the tunnel turned out to be a serious miscalculation, as the cost ballooned to almost 12 billion by the time it opened in 1994, more than double the original estimates.20 The project has in fact been beset since its inception in 1986 by financial and technical woes, blown schedules, and highly public battles between the Anglo-French company managing the project, Eurotunnel and its contractors. 21 To finance the Tunnel, Eurotunnel sought both equity and loan capital, the latter being to some extent conditional on the former. Subsequent cost overruns made it necessary for Eurotunnel to increase both equity and loan capital beyond the combined 6 billion which had been raised by the end of 1987. In fact, in spite of the large amount of regulatory machinery that has been built around the Tunnel, real economic control is in the hands of the banking syndicate. It is the banks which control finance at each stage, by monitoring construction before allowing Eurotunnel to draw on its agreed lines of finance. Total financing costs, including allowance for inflation was 4.8 billion in 1987. 22 By the time the Tunnel opened in 1994, it was 12 billion.23 At the root of these cost increases is that large construction projects in general are notorious for cost and schedule overruns. In the case of Channel tunnel, four major factors include piecemeal approvals on some elements of the project, the inexperience of Eurotunnel in negotiating with these experienced contractors, minimizing margins or the competitive pressure that prompts bidders to cut their cost estimates to the bone in order to make a successful bid, and delays in schedule. From all of these, the weapon can be said to be is placed in the hands of the contractors.24 Environmental aspect. The building of the Channel Tunnel was such an outstanding infrastructure and is having an impact on traffic flows.25 The Channel Tunnel project was expected to have major repercussions on the pattern of passenger and goods traffic, not only for the cross-Channel market itself but also in terms of lessons to be learned for other international projects.26 There was a major fire in 1996 and everyone was evacuated to safety, although the tunnel service was mothballed for seven months as repairs dragged on.27 With the 32-mile long Chunnel, the heat that the high-speed trains generate as they pass through the long, narrow tunnels cause temperatures as high as 130 degrees Fahrenheit. As a result, Eurotunnel is buying what has been described as the world's most expensive air-cooling system. The $200 million system consists of pipes, running the length of the main tunnels, through which chilled water flows from gigantic refrigeration units located at each end of the Tunnel.28 Nothing negative has been reported of chalk marls. This tunnel is admirably ventilated, and on visiting days is lighted with electric lamps, with the steam power at the mouth of the shaft being sufficient.29 Economic aspect. The Tunnel symbolizes the on-going economic integration of Europe.30 The size of the investment involved was so much greater than that of other infrastructure projects, said to foreshadow future giant transport. It would bring large-scale changes to inland transport by creating the possibility of thorough journeys without transshipment.31 Shuttle trains, owned and operated by Eurotunnel, are carrying trucks and cars through the tunnel where roughly 60 percent of Eurotunnel's revenues will come from this shuttle service.32 The tunnel, one of the greatest civil engineering projects of the 20th century, has an ultimate design capacity of 600 trains per day each way.33 In 2004, some 7,276,675 passengers travelled through the tunnel on Eurostar while in the same year Eurotunnel carried 2,101,323 cars, 1,281,207 trucks, and 63,467 coaches on its shuttle trains. Rail freight carried through the Channel Tunnel increased by 8% to 1,889,175 tons in 2004.34 Greatest among the hurdles that Eurotunnel is facing is earning enough revenue from traffic through the Tunnel to service its vast debts. The long-term outlook for Eurotunnel looks good. However, there are worries about the viability of the rail freight business, and with a recession to contend with, those who may own most of Eurotunnel's shares at the turn of the century may not be today's shareholders but the bank.35 C. Planning, methodology, and implementation. In 1875 the Channel Tunnel Company set up by the British engineer John Hawkshaw was given authority to build a tunnel by the governments of both Britain and France. The present tunnel is based on a scheme drawn up in 1960 by the Channel Tunnel Study Group, an alliance of British and French companies; Technical Studies, Inc. of the United States; and the Suez Canal Company. 36 It is configured with two running tunnels which run in parallel and measure 7.6 meters (25 feet) in diameter each. 37 Operated by British Rail, the French (SNCF), and Belgium (SNCB) railways, the Eurotunnel provides three different types of service between England and the Continent. Eurostar provides passenger service, and Le Shuttle provides automobile, coach, and lorry service between Folkestone and Calais. 38 Distrust upon each other made Britain and France tarry with their plans of finishing the tunnel. Until finally, World War I made them see the importance of the tunnel in the matter of trenches. Finally, they were able to finish it. By that time also that they were ready to accept with finality the tunnel's importance, technology was available. D. Organizational/stakeholder expectations. and problems. It was correctly predicted that cross-channel traffic was growing so fast that there would be enough business for both the tunnel and the ferries. But the ferry business remained.39 Management turmoil was said to dog the project from the start. In 1989, seven of the eight top people in the construction organization left on account of a conflict between the contractors and government overseers: "The fundamental thing wrong is that the constructors own less than 6% of Eurotunnel. Their interest was to build and sell the project at a profit, but Eurotunnel's interest is for it to operate economically, safely and reliably for the next 50 years.40 Much of the original construction of the tunnels was controversial, mainly because it was built many billions of pounds over budget.41 The Channel Tunnel also highlighted the shortcomings of the British rail network: Eurostar trains were able to run at speeds of up to 186 mph in France, but the English rail track slowed them down considerably. The Government authorised a Channel Tunnel Rail Link project to overcome this problem, causing considerable controversy about its route. 42 E. Issues and problems. In the late 1990s, a new problem arose. Illegal immigrants were using the tunnel for clandestine passage into the UK from centres in northern France and most notably from Sangatte, where the tunnel opens. A few were said to attempt to walk through the Tunnel or cling to the trains themselves, but most try to hide in freight containers or trucks using the tunnel.43 Eurotunnel spent 4 million preventing asylum seekers from entering Britain in 2002 44 F. Changes from project and success. For the first time since the Ice Ages, the Channel Tunnel makes the old dream of a ground link between Great Britain and continental Europe a reality 45 The Channel Tunnel is regarded by many people as one of the most remarkable construction achievements ever; one of the wonders of the world, even.46 In the first five years of operation, trains carried 28 million passengers and 12 million tons of freight through the tunnel.47 Before, crossing the stormy channel in the small ferries of the day was the part of the journey that most travellers dreaded.48 The Channel Tunnel project proposal from Eurotunnel group was accepted not only because of its safety benefits and the favourable technical aspects, but also because of the environmental considerations.49 Technically, it was a success. Driven by compressed air, the boring machines worked well, and there was so little flooding they only switched the pumps on for half a day every two weeks! Soon the invention of clean electric trains offered an even better solution. 50 Between 1994 and 2000, 112 million people used the Channel. Thatcher described the Tunnel as "a project that can show visibly how the technology of this age has moved to link the Continent and Britain closer together." For her, the Tunnel would boost the private commercial sector and provide tangible evidence of her commitment to the ideal of national recovery spearheaded by free enterprise.51 The Channel Tunnel is only one of a number of ways of entering the United Kingdom (UK) and in that sense it is the same as any sea or airport. But it is more than an ordinary seaport or airport for its capability.52 G. The project manager and the project. A working knowledge of general management and familiarity with the special knowledge domain related to the project are indispensable to a project manager who would implement this project. 53 Supporting disciplines such as computer science and decision science may also play an important role. According to Hendrickson54 the project manager is the most important person for the success or failure of a project. He is responsible for planning, organizing and controlling the project. Consequently, it is important to recognize the changing nature of the organizational structure as a project is carried out in various stages. The project is bulky in terms of time involved in planning, execution, implementation, and management. No one person or one group can cope solely working alone. Work involved the cooperation of many groups or organizations. The main question in evaluating this project would be if expected benefits have been achieved.55 As recorded, the tunnel had for its purpose a railway.56 Invicta Media 57 underscores that the first steam locomotives hauled passenger trains in the 1820's. By 1850, steam railways were running most of the way from Paris to Calais, and from London to Dover. The Channel Tunnel, having fulfilled benefits therefore, was a sure way of precluding seasickness. A more important reason that necessitated the building of this tunnel was an extreme need during the First World War. During the period from 1914-18, the tunnel could have supplied the trenches so needed. The generals wished that the Tunnel they had so opposed had been built! During this time, too, fresh troops, munitions and supplies had to cross the area under constant fire from enemy ships, submarines, airships and aircraft - needing the protection of the Dover Patrol. Wounded soldiers were also in danger returning home from the Front.58 It was estimated that the Tunnel could have shortened the war by 2 years - in fact, the Germans might not have invaded France if the Tunnel had been built!59 H. Evaluation. From project management approach using Blair Witzel's taxonomy,60 the project, in sum, may be said to have been delivered on time but not on the budget. The risks like tunnel fires and use of the tunnel for asylum purposes have also been identified and addressed well by the project team. Project communications have not been reflected much in literature but realization of the project implies that communication within the ranks was ample. From the number of people patronizing the services of Channel Tunnel, it is implied that people have been adequately informed. As project communications have not been visible in literature, the same goes for methods. Suffice it to say, things came into place even as time beat unkindly on the project with many interruptions. This reflects the acumen of those in management in complex projects as "recognizing the changing nature of the organizational structure as a project is carried out in various stages."61 Team work tended to be achieved even as there were resignations earlier of those with the intention of building, then selling the project. Idea generation was most welcome as in the first place, the Channel Tunnel began with an idea that was responded to. In fact, the work teams, too, were a conglomeration of geologists, engineers of all kinds, physicists, information technologists, architects, and the like. Changes in the case of Channel Tunnel that were taxing came in the form of responsibilities in coping with having to pay debts. As there were no adverse reports in this regard, the fear shifts to who could be majority share holders in this project in the future: the stockholders or the lending banks. Overall, except for its having to pay its financial obligations over time, the project can be said to be viable. III. Conclusion The Channel Tunnel project is one of the longest gestation periods in history that its ideas, plans, and efforts span for more than 200 years. As described by Harris,62 its challenges included overcoming the technological issues, gaining consensus among the politicians, overcoming the concerns of the British military, and obtaining finance. Channel Tunnel is more than a simple project that it does not only refer to a project manager but to a senior responsible owner (SRO) and an investment decision maker (IDM) as responsible persons overseeing the business case. 63 Despite the hindrances, Channel Tunnel was able to be realized over and above business reasons and should be judged as such. Socially, it has been serving well the purpose of travelling citizens of both Britain and France. Environmentally, geology has cooperated with its chalk marls. Financially, key groups went out of their way to break rules just so the project would be able to be realized. Economically, however, the project has to grapple for ways in order to pay for its debts. Overall, the project can be said to have served its purpose. As what happens when projects are more of social responsibilities than businesses, economic interests are not satisfied to the full as is true in this project. However, project managers should be so challenged to find ways for the project to earn in the years ahead to create a balance in its social responsibility and as business venture. End Notes 1 Veditz, Leslie Allen (1993). "The Channel Tunnel: A Case Study. Executive Research Project. The Industrial College of the Armed Forces National Defense University. Fort McNair, Washington, D.C. December 4, 2005. http://www.ndu.edu/library/ic6/93CS08.pdf. 2"Channel Tunnel," Wikipedia. December 2, 2005, Available at: http://en.wikipedia.org/wiki/Channel_Tunnel. 3 "The tunnel under the channel." Business and Money. Google Answers. November 19, 2005. December 4, 2005. http://answers.google.com/answers/threadviewid=595242. 4"Channel Tunnel. England-France." International Tunnels. Lahmeyer International. December 4, 2005. http://www.lahmeyer.de/e/units/gt/tunnels/channel_tunnel.pdf. 5 Witzel, Blair. Project Evaluation: Measurements of Success. June 6, 2005. December 4, 2005. http://www.charityvillage.com/cv/research/rom23.html. 6 Hendrickson, Chris (2003). "Organizing for project management." Project Management for Construction. Fundamental Concepts for Owners, Engineers, Architects and Builders. December 4, 2005. http://www.ce.cmu.edu/pmbook/02_Organizing_For_Project_Management.html. 7"What is the Channel Tunnel" Debate - Issue Briefs. www.politics.co.uk. December 1, 2005, Available at: http://www.politics.co.uk/issues/channel-tunnel-$2073000.htm. 8 Encyclopedia4U - Channel Tunnel - Encyclopedia Article. www.encyclopedia4u.com /c/channel-tunnel.html 9 Wright, G. & Ferguson, LP, (1995 ), The Chunnel and Eurostar Services, Excerpt taken from the 1996-97 edition of Europe by Eurail: How to Tour Europe by Train with permission from the author, December 2, 2005, Available at: http://www.railpass.com/eurail/articles/chunnel.htm. 10 "The tunnel under the channel." Google Answers. 11"Channel Tunnel. England-France." International Tunnels. Lahmeyer International. December 4, 2005. http://www.lahmeyer.de/e/units/gt/tunnels/channel_tunnel.pdf. 12 Ibid. 13"Business case management." Office of Government Commerce (OGC), United Kingdom. December 4, 2005. http://www.ogc.gov.uk/sdtoolkit/deliveryteam/briefings/businesschange/bus_case_brief.html. 14 Hendrickson, Chris (2003). 15 Veditz, Leslie Allen (1993). "The Channel Tunnel: A Case Study. Executive Research Project. The Industrial College of the Armed Forces National Defense University. Fort McNair, Washington, D.C. December 4, 2005. http://www.ndu.edu/library/ic6/93CS08.pdf. 16 Ibid. 17 Ibid. 18"Channel Tunnel," Infoplease. December 1, 2005, Available at: http://www.infoplease.com/ce6/world/A0811353.html. 19 Veditz, Leslie Allen (1993). 20 Ibid. 21 Ibid. 22 Veditz, Leslie Allen (1993). 23"What is the Channel Tunnel" Debate - Issue Briefs. www.politics.co.uk. December 1, 2005, Available at: http://www.politics.co.uk/issues/channel-tunnel-$2073000.htm. 24 Veditz, Leslie Allen (1993). 25 Houe, M. (Chairman). OEST. "COST 312. Evaluation of the Effects of the Channel Tunnel on the Structure of Traffic Flows." Final Report. 1993. 253 pp. ISBN 92-826-6206-3. EUR 15126. February 27, 1999. December 4, 2005. http://www.cordis.lu/cost-transport/src/cost-312.htm. 26 Ibid. 27 BBC NEWS | UK | Ten years of the Channel Tunnel.news.bbc.co.uk /1/hi/uk/3685559.stm 28 Veditz, Leslie Allen (1993). 29 Subterranean Britannica: Sites: Channel Tunnel-1880 attempt. www.subbrit.org.uk /sb-sites/sites/c/channel_tunnel_1880_attempt/index.shtml 30 Veditz, Leslie Allen (1993). 31 Houe, M. (Chairman). OEST. "COST 312. Evaluation of the Effects of the Channel Tunnel on the Structure of Traffic Flows." Final Report. 1993. 253 pp. ISBN 92-826-6206-3. EUR 15126. February 27, 1999. December 4, 2005. http://www.cordis.lu/cost-transport/src/cost-312.htm. 32 Veditz, Leslie Allen (1993). 33 MSN Encarta. Channel Tunnel. In Factbites. 34 "The tunnel under the channel." Business and Money. Google Answers. November 19, 2005. December 4, 2005. http://answers.google.com/answers/threadviewid=595242. 35 Cf: Veditz, Leslie Allen (1993). 36 MSN Encarta - Channel Tunnel. In Factbites. 37 www.writer-tech.com /pages/summaries/summchunnel.htm. 38 Harris, C. S, "Channel Tunnel Facts," Geology Shop, December 2, 2005, Available at: http://www.geologyshop.co.uk/chtunfacts.htm. 39"Why wasn't it built before" Invicta Media, www.theotherside.co.uk, Last updated March 30, 2002. December 2, 2005, Available at: http://www.theotherside.co.uk/tm-heritage/background/tunnel.htm 40 Morton, Alastair. Eurotunnel CEO, quoted in ENR, 12/10/90, p. 56. In:.Hendrickson (2003). 41 "What is a project" Office of Government Commerce (OGC).United Kingdom. December 4, 2005. http://www.ogc.gov.uk/sdtoolkit/deliveryteam/briefings/businesschange/proj_mgmt.html#role. 42 Ibid. 43"What is the Channel Tunnel" Debate - Issue Briefs. www.politics.co.uk. December 1, 2005, Available at: http://www.politics.co.uk/issues/channel-tunnel-$2073000.htm. 44 Ibid. 45The Channel Tunnel train: Eurostar. www.raileurope.com /us/rail/eurostar/channel_tunnel.htm 46chtunfacts. www.geologyshop.co.uk /chtunfacts.htm. 47 "Channel Tunnel (Chunnel)," Wonders of the World Databank. December 2, 2005, Available at: http://www.pbs.org/wgbh/buildingbig/wonder/structure/channel.html. 48 Channel Tunnel.www.theotherside.co.uk /tm-heritage/background/tunnel.htm. 49 Amazing projects.www.itc.nl /ingeokri/newsletter/summer98/newpage1.html. 50 "Why wasn't it built before" Invicta Media, www.theotherside.co.uk, Last updated March 30, 2002. December 2, 2005, Available at: http://www.theotherside.co.uk/tm-heritage/background/tunnel.htm. 51Gould Distinguished Lecture Series. Fourth Annual Address, 1995. www.lib.utah.edu /gould/lecture95.html). 52 Channel Tunnel.www.cps.gov.uk /legal/section2/chapter_f.html. 53 Hendrickson (2003). 54 Ibid. 55 "What is a project" Office of Government Commerce (OGC).United Kingdom. December 4, 2005. http://www.ogc.gov.uk/sdtoolkit/deliveryteam/briefings/businesschange/proj_mgmt.html#role. 56 "Channel Tunnel (Chunnel)," Wonders of the World Databank. December 2, 2005, Available at: http://www.pbs.org/wgbh/buildingbig/wonder/structure/channel.html. 57 Invicta Media, www.theotherside.co.uk. 58 Ibid. 59 Ibid. 60 Witzel, Blair. Project Evaluation: Measurements of Success 61 Hendrickson, Chris (2003). 62Harris, Geology Shop. 63"Business case management." OGC. Read More