Analyzing the Success and Failure of Millennium Dome - Essay Example

? Millennium Dome: Project Analysis Table of Contents Introduction 3 Project Management Process 4 Formulation of the organization as system of problem 4 End Planning 4 Means Planning 4 Resource Planning 5 Design of Implementation and Control 5 Difference between small scale and large scale project Management 5 Critical Evaluation of the initial phase of the project 8 Critical Analysis of the actual execution of the project 10 Measuring Project Benefits 13 Analyzing the success and failure of the dome 13 Recommendation 14 References 16 Bibliography 17 Introduction A project can be defined as a one-shot, time limited; goal oriented major undertaking which requires the efforts of various skills & resources. A project means to achieve an end in harmony with the development process of the sponsoring organization. It is also usually a means to develop assets, acceptable within quality specifications. It is a process whereby six types of resources are invested; such resources are better known as the 6 M’s. These are men, materials, machines, money and minutes. Out of the six M’s minutes and money are mostly independent of one another. But the other 4M’s could be procured in exchange for money, but they are difficult to evaluate in minutes and monetary terms. Therefore it must be ensured that organizations should exercise the utmost caution in selecting and execution a project keeping in mind that resources are scarce commodities. Also keeping the scarcity factor in mind organizations must ensure that the projects should be clearly defined from the point of view of implementation and control (Kothari, 2007, p. 201). During the course of a project an organization faces a number of projects that are needed to be overcome to ensure successful execution of the project. The study looks to analyze such problem keeping the case of Millennium Dom at the focal point of discussion. The study looks to provide clear and concise understandings of the overall project management process, initial phase of the millennium dome project planning, the actual execution of the project, evaluate the outcomes of the project ( both positive and negative); and finally based on the above analysis the study looks to provide recommendations (De, 2011, p.229). Project Management Process A project management can be defined as the application of various skills, knowledge, tools, and techniques in order to achieve the required project goal. According to the definition of project management defined by The Project Management Institute (PMI), it is the art of coordinating and directing both material, financial and human resources throughout life of a project by using advanced management techniques to successfully achieve predetermined goals. Formulation of the organization as system of problem This is done in such a way to capture and highlight the essential and systematic properties of the organization, not by listing independently formulated threats and opportunities; but by protecting the future that the system would have it, and its environment, were to continue unchanged. It is the future that a system currently is in. End Planning This involves selecting the ideals, objectives and goals to be pursued by preparing an idealized redesign of the system planned for a design which the relevant stake holders would replace the existing system today if they were free to do so. The difference between this most desired design and t description developed in the first phase define the gaps to be filled by the remainder of the planning process. Means Planning Here the ways of filling the gaps are selected. These are more likely to require invention than discovery. They can take the form of policies, programs, projects and procedures, practices or individual courses of action. Resource Planning A determination is made of how much of each type of resource –people, facilities, equipments, materials, energy, money, information, knowledge and understanding will be needed by the means elected, and when these requirements will arise. Then it is quite necessary to determine whether and how these needs can be met. If they are found to be infeasible, the previously formulated ends or means will have to be modified and the cycle has to be repeated. Design of Implementation and Control Decisions are made as to who is to do what, where and when, and how the behaviour and the corresponding effects are to be monitored and modified when necessary. Thus it is quite clear that a project has to be consistent with the developmental activities of the organization. (Nagarajan, 2004, p.321). Difference between small scale and large scale project Management According method of project management methodology or MPMM organizations can scale projects in the form of small, medium and large projects. Such scaling can be achieved based on certain factors such as total availability of financial resources, team members involved in the project, size and the number of deliverables need to be produced and of course the required time frame of final delivery. According to the methodology with the increase of the project size the degree of complexity also increases (Biswas, 2011, p.105). In order to achieve the best possible results the organizations should scale the project size ever before the making the initial planning. This is because the activities in each of the project life cycle phase changes based the size of the project (Choudhury, 1988, p. 251). Small Projects Large Projects Initiation Appoint project team Setting up project office Developing a thorough business case Initiate Feasibility Study Appoint project team Setting up project office Initiate phase review Planning Develop Project Plan Develop Quality Plan Develop Communications Plan Develop resource plan Develop financial Plan Develop Quality Plan Develop Risk Plan Develop Procurement Plan Develop Communications Plan Execution Identify key Deliverables Monitor and control Perform Time management Perform Cost Management Initiate Quality management Initiate risk Management Conduct Procurement Management Identify key Deliverables Monitor and control Closure Conduct project closure Conduct project completion Document project closure report Complete the closure actions Begin post project implementation review Conduct project closure Conduct project completion As it can be seen from the project sizing matrix the activities in the project life cycle phase changes quite drastically based on the size of the project. In the context of the present study it needs to be mentioned that initially the dome was perceived as a project of a relative smaller scale. The conservative government under PM John Major looked at the dome as a venue to celebrate certain festivals and fairs. However, the incoming government of Labour party under the leadership of Mr. Tony Blair had other things in mind. The government labour party vastly expanded the size of the project. As a matter of fact, Blair claimed the dome to be victory of excellence over mediocrity. In the context Blair also increased the financial resources and funding. However, as it can be seen from the above matrix that project complexities increase in each and every phase of the project life cycle. Such complexities surely cannot be overcome by increasing the financial budgets. Also the project feasibility study along with several other factors was not up to the mark, which lead to the below per performance of the dome. Critical Evaluation of the initial phase of the project The initial phase of the project phase has been evaluated by relating the project background with the project size matrix. The initial phase of the project was tagged as the so called conservative days. In the February of 1994 the conservative Government had a relatively moderate plan for the dome. The government had set up a commission to look over the events related to the events related to the dome. The government also decided that the events would be financed by the new National Lottery. In June the chairman of the government suggested a Millennium exhibition to open the millennium dome in 2000. However it got delayed. Here it needs to be mentioned that over fifty sites had applied for the dome project. But in the end it came down to a battle between Greenwich in south-east London and Birmingham. In the end Greenwich won despite of the environmental issues. In January of 1997the commission publicized a ?250 million from lottery funds. However, the dome project was facing a major problem. None of the private companies were looking to accept the high risks related to the project. But, the government decided to stick to the project. In the end, Millennium Central Ltd turned out to be the first private sector company to get nationalized since the 70’s. In the month of February Jennie Page became the chief executive of the company. However in the month of May the labour government came to the power. In the initial period certain factions in the government were having thoughts to abandon the project due to the high risk factor. However, the Prime Minister Tony Blair was in favour of the project. Construction of the Dome itself was completed by June 1998. Here it needs to be mentioned that companies were quite sceptical to sign up as sponsors. But, in 1998 Tesco, Sky, BT and Manpower became the founding partners. The last year was a definite race against time; both for the Dome and the sponsors. The jubilee line extension was supposed to take 3 years but eventually it took five years. Going back to the project size matrix it can be seen that key activities are Develop resource plan, Develop financial Plan, Develop Quality Plan, Develop Risk Plan, Develop Procurement Plan and Develop Communications Plan. From the above description it can easily understood that both the governments were indulged in resource and financial plan. Both the government was unsure about whether to continue with the project or not. Very little effort was made on the part of both the government to develop the risk plan. Both the governments were busy in getting sponsors, raising funds, etc. Very little emphasis was provided in conducting feasibility planning. All in all even after understanding the high risk nature of the project. The project lacked internal as well as external communication. Very little effort was made on the part of both the governments in conducting project feasibility analysis. Critical Analysis of the actual execution of the project Finally after all the tussle and speculation the dome was opened in the January of 2001. However, the prototype responsibilities for the dome was quite complex. The pattern was responsible to the government and the commission. The opening night of the dome was a disaster to say the least. Here it needs to be mentioned that the opening night cost the government ?5 million. The commission had invited approximately 10000 special guests. But the plan was poorly executed as many of the special guests that included celebs as well as dignitaries did not receive the ticket. However, that is not all. Due to lack of scheduling many of the invitees had to wait outside for long hours. Also the invitees were supposed to pick up hall tickets from Stratford station situated in the north east London. But the newly built Stratford station was not well equipped enough to handle such a large crowd. The fiasco spurred up strong criticism from the media. Also the sponsors were not very happy with the way the whole project was executed. In May, 1997 the planned total project cost was ?758 million. This also comprised of ?88 million contingencies. This meant that there was an increase in the project cost by more than 50%. The initial planned value was ?500 million. The project was to be from three different sources. This included the national Lottery ?414 million14, tickets and merchandising: ?169 million15 and commercial sponsors’ ?175 million. This makes a total of ?758 million. But all these provisions proved to not to be large enough. NMEC found it really hard to predict the timing and amount of the funding needs. The financial problem related to the dome was partially due to the timing of the cash in and out flow. But the main reason was the short of in revenues. The figure below can provide a better idea. After the dome had been opened, there was tremendous amount of pressure from the sponsors mainly due to the large amount of cash short fall. Add to that there was negative coverage from the media. The staff morale was also quite low. This led to the resignation of Jennie Page within five weeks of the opening of the dome. Within one month of the opening the management had to face large amount of problems. This included stuck escalators, inadequate Signage, long queues even thought the number of visitors was much less than the expected. The commission had developed a business plan for the sake of carefulness. Here it needs to be mentioned that the commission had hired famous business consultant group Deloitte. By suing predictive analytics Deloitte had forecasted on 8 million paying visitors. But for some reason the management over looked at the predictions and forecasted on 12 million of visitors. This turned out to be a huge mistake on the part of the management as the figures were even less than that of forecasted by Deloitte. On 28 January From 12 million to 10 million On 19 May From 10 million to 6 million In August From 6 million to 4.5 million Here it needs to be mentioned that the sales and marketing strategies were based totally on the dome itself. The company reviewed the strategy on the in the year 2000. The authorities found that the marketing budget has been at low in the actual business plan. The main reason was to that the dome authorities believed that the ticket sales would be driven by massive media coverage. Hence not much effort and expenditure had to be spent for the marketing and sales activities. As it can be seen from the results, it turned out to be a huge mistake by the management. Also it needs to be mentioned that the dome thought that media would drive in the sales. But actually as it has been discussed, there was enormous amount of negative publicity from the media. From the above analysis and the based on the project size matrix it can be easily seen that the dome lacked time management, cost Management, quality management and risk Management. Measuring Project Benefits The millennium dome project was more of a failure than a success. Therefore very few benefits were adhered from the project. But still it is in this section the importance of measuring the project benefits would be discussed. Usually the project managers use the detailed project report or the DPR to measure the results of the report. During this phase the management is concerned with some key issues such as; whether the project has been finished by the scheduled time or not; whether the completed work has met or exceeded the project planned outputs; has the work been finished within the estimated cost or not. It is needless to say that in the context of the project all the concerned questions were answered negatively. An important tool to measure the project output is the project audit. W. S. turner in his book on project auditing had defined project audit as a formal and systematic examination of the performance of an ongoing project as compared to the requirement. This involves the measurement against predefined and relevant standards. The project audit looks to focus on four key issues current status, future status, critical management issues and exposure to risk and potential losses. The millennium dome project was proved to be a failure within the first month of the project. But, even after the closure of the project the debacle continued. Over the course of the next three years the authorities had to spend ?15 for the decommissioning of the dome (Belch and Michael, 2005, p. 325). Analyzing the success and failure of the dome The millennium dome was more a failure than a success. There were many operational and marketing shortcomings. Therefore there is not much to discuss when it comes to success of the project. In this section however some factors leading to the failure of the project would be discussed. One of the most important reasons for the failure was the fact that the forecasted project outcomes were unrealistic to say the least. The cost of government funds was just over ?1,000 million, where as the forecasted compared to the original target of ? 500 million which later increased and became ? 750 million. There was too much of political interference, but then again without that the project may never have actually started. There were various planning and operational problems. The people involved in the project were not able to decide whether to start the project or not. Despite of the fact that there was huge amount of risk involved in the project, the authorities somehow chose to overlook that fact. Also the report submitted by Deloitte was also neglected. The dome was off to awful start. There were multiple cases of equipment breakdowns. Although, the team appointed by the government put in the best of efforts to turn around it proved to be too little too late. Even after the closure of the project the management was unable to sell the dome (Brown, 2009, p. 209). Factors Success Failure Constructions of the Building Application of Space Organizational Pattern Costs Marketing and Communication Project Budgeting and Costs Operations Recommendation The structure of the management accountability and oversight must be made simple and clear. Strong and effective corporate governance is needed. The organizational structure and the capacity should be able to adapt to the different stages of the project life cycle. The project costing should be dome based on the thorough understanding of the grave cost. The financial income of a project is dependent upon the income through the visitors. Also the marketing and communications activities have to be more realistic. The management may take the help of any marketing consultancies to promote and reposition the dome as a product. The belief that the media would promote the dome and hence focus on marketing activities is not needed is not realistic. Another aspect that the management has to take into consideration is the contingency planning. The management needs to be flexible to respond to things that will not go according to plan. There should be provision for such contingencies in the project budget itself. The financial position should be reported accurately. The role of corporate governance is also going to be critical and important in this case. References Belch, G and Michael, G.2005. Advertising &Promotion-An Integrated marketing Communications Perspective. Tata McGraw-Hill Publishing Company Ltd: India. Biswas. P. 2011. Project Management. Matrix Educare: India. Brown, L. 2009. Marketing and Distribution Research. Ronald Press Company: US. Choudhury, S. 1988. Project Management. Tata McGraw-Hill Education: India De, B. 2011. Strategic Management. Matrix Educare: India. Kothari. C. (2007). Research Methodology. India: New International Nagarajan, K. 2004. Project Management. New Age International: India. Bibliography Bartlett, J. 2004. Project Risk Analysis and Management Guide. APM Publishing Limited: UK. Cowan, A. 2005. Risk Analysis and Evaluation. Global Professional Publishing: UK. Henry, A. 2008. Understanding Strategic Management. Oxford University Press: UK. Wetland, J. 2007. The Project Management Life Cycle: A Complete Step-by-Step Methodology for Initiating, Planning, Executing and Closing a Project Successfully. Kogan Page Publishers : UK. Read More