Managing the Trunk Road Network in North West Scotland - Term Paper Example

INTRODUCTION This paper is about managing the Trunk road network in North West Scotland as the project manager of a joint venture company that has been entrusted with the task of managing and maintaining the road network. The paper discusses the issues arising out a variety of factors that include cost overruns, outsourcing of some key functions and the planning and programming issues that have to be dealt with. The emphasis of the paper is in discussing the role of the project manager in establishing communication procedures and protocols along with a clear road map for tackling the issues mentioned above. The paper starts off by detailing the project by providing an overview of the project and then lists the scope of the project. Project Management is both an art and a science. The art of project management is in how well the project manager deals with the resources assigned to the project and establishes clear lines of communication among the different stakeholders along with following the norms and protocols. I have not provided an overview of the project or its scope as they have been enumerated in detail in the brief that has been given as part of the assignment. Suffice to state that the project involves civil engineering works undertaken both for a new works as well as maintaining and upgrading existing works. STEPS TO ESTABLISH ROLE In this section, I discuss the steps that I would take to establish my role as project manager for the whole project. Considering the size of the project and the fact that it is a joint venture that is responsible for maintaining and managing the trunk road network in North West Scotland, there are multiple stakeholders who have to be kept in the loop if I am to successfully execute my role as project manager. For starters, I need to define my role and communicate the scope and nature of the role to the different stakeholders along with a clear definition on what it takes to be a project manager. The role of Project Manager is like that of a conductor in an orchestra. He or she is the fulcrum around which the project revolves and like the maestro who conducts the performance, the project manager is looked upon by all the key players to direct them and manage their work. Further, the different stakeholders would want to be informed of the status of the project and the way things are going on a periodic basis. The team members who make up the project team would like to be guided in their work and be told what to do and in some cases, how to do. Hence, the project manager has to direct and guide the team members as well as the other players in the project and apprise them of their day to day duties and responsibilities. The steps that I would take to define my role would be to establish channels of communication with all the stakeholders and team members. Needless to say, these are two different channels of communication. The team members would have to be handled on a day to day basis whereas the stakeholders would need to be apprised on say, a weekly or a fortnightly basis. My role in this project is mainly to direct and supervise the management and maintenance of the Trunk Road Network in North West Scotland. This would involve the various facets like laying new roads, upgrading of existing roads and maintaining the roads that have been laid. There would be different departments that would be responsible for each of these activities and my role would be to oversee each of these departments and coordinate the activities of the same by promoting cooperation and communication between the different departments. One of the key steps in establishing my role as a project manager would be the way in which I communicate with the rest of the stakeholders as well as the project team. Further, there needs to be a clear enumeration of responsibilities and duties of the team members as well as a clear definition of my own role as a project manager. This would involve defining what I need to do and what I can delegate to other members of the project team. As outlined in the previous section, once the definition of the role is done, there should be communication of the same to the relevant stakeholders. The communication channels need to be opened and issues like setting up of committees and planning groups with a specific role and responsibility for each group and committee defined as well. There should be clear guidelines on when each of these groups would meet and define the agenda for the meetings. I would try to establish a chain of command that would stretch from me and include the managers who are reporting to me. Apart from establishing communication protocols, the delegation of authority is a priority item for me as I go about establishing my role. Proper procedures for escalation and timely resolution of issues and complaints should be established as well. Since this is a project that deals with road upkeep that has a direct bearing on safety of the commuters, I should be one of the people who should be notified when any issues related to safety and maintenance arise in the project. PLANNING AND PROGRAMMING ISSUES A project of this nature involves elaborate planning and programming on the part of the project manager and the project team. For starters, the scope of the contract is comprehensive in nature and hence the planning process should establish clear guidelines on each of the components and when they should be done. This would involve planning and budgeting for the activities ranging from new outlays to maintaining existing roads. For new outlays, the planning starts from scratch whereas for the ongoing maintenance, the planning process should consider the incremental benefits in terms of cost and deliverables that accrue as a result of the spend on the ongoing works. Further, the other element of planning is the anticipation of risks and the resultant matrix of mitigating the risks by means of a comprehensive risk management plan. The risks like reduction in capital outlay (that are discussed in the subsequent sections) as well as the risks associated with outsourcing should be considered in detail and the planning process include mitigation strategies for the same. The programming issues that need to be considered for this project arise from the ability to manage the workload of the team members as well as the way in which the works are executed. Without repeating the obvious, planning is the part where the issues are considered from a theoretical perspective whereas programming is the part where the execution of the plan takes place. Hence, there is a need for both the planning as well as the programming function to be in sync and without lags in understanding and communication or ambiguous definition. The planning component should also consider how much of cost savings can be achieved by using alternative methods of executing the project. For instance, there can be different ways of laying roads because of different technologies and processes that can be used. Hence, the planning process must take into account the alternatives along with a cost benefit analysis for each of them and weigh in the risks for the same before committing to a particular process. The opportunity cost of the capital is a definite indicator whether the project is a success in financial terms and hence the same must be considered in the planning process. The programming issues that arise out of this are the ways in which the chosen process is executed without friction and without slippage. It is one thing to plan a timeline and budget for the costs. It is another thing to slip behind schedule and incur cost overruns. Further, the programming must also consider the quality of the works. As is taught in Project Management, the triple constraint of time, cost and quality should be managed and how well this is done would reflect on the overall success of the project. As outlined above, the planning function as well as the execution function needs to be in tandem and the risks associated with each of the activities as drawn up in the PMP (Project Management Plan) need to be addressed. Contingency planning should be a feature of the project and as far as possible; all the contingencies should be provided for. Unforeseen risks, by definition, cannot be planned for. However, by use of pro-active methods of project management, the costs of these unforeseen eventualities must be minimized. IMPLICATIONS OF OUTSOURCING In this section, we look at the need for outsourcing and some of the issues to be considered when outsourcing parts of the project or services. Outsourcing is usually considered feasible when the cost savings are in the range of 20-30% of the total cost that otherwise would have been spent on doing the work in-house. Outsourcing as a strategic imperative pays off after the first two to three years. Given the description of the project as having cost overruns and being beyond budget, there is a clear need to consider alternatives like parcelling out some of the works in the maintenance of the road works. Before we dwell on the need to outsource some of the works involved with this project, it is necessary to examine the benefits that would accrue as a result of outsourcing key chunks of the project. As outlined above, outsourcing usually reduces costs by significant margins and helps improve the bottom line of the project. Considering the fact that the road repair and maintenance works along with the brief to lay new roads involves separate pieces of work that can be done by different contractors, there is a clear need to consider outsourcing of some of the functions. If we consider the various parts of the works that make up the project, one can get a clear sense that there are activities within the project that can be outsourced to different players. For instance, the supply of tar and bitumen for laying roads is already handled by a different contractor. If we add the supply of workmen to lay the roads and otherwise involve themselves with the road works, one can sense a clear need for parcelling out these functions to a third party contractor. The parts of the contract that can be outsourced are the Cleaning of the traffic signs, road lighting faults, grass cutting and weed control among other things. These functions are non-critical and hence can be outsourced without compromising on the quality of the project. This is not to say that outsourcing compromises quality. Just that when considering the outsourcing option, it is better to ensure that the non-critical functions are outsourced first followed by the other functions like new laying of roads that involve substantial capital outlays. The bottom line for any outsourcing of the parts of the project is the cost savings that can be achieved vis-à-vis the costs incurred when doing the same functions in-house. It becomes imperative that outsourcing of the functions like supply of labour and the maintenance functions of the project can be safely outsourced leading to a cost reduction that would help the project. Further, the jobs like administrative and secretarial staff can be outsourced leading to these positions being filled by temporary workers instead of permanent ones. When the staff positions are outsourced, it would lead to substantial cost reductions as there is no obligation on the part of the project team to pay medical costs as well as other perks that are part of the package for permanent positions. World wide, this is the critical reason why the non-essential functions are outsourced as they reduce the overheads associated with staff positions substantially. As has been discussed throughout this section, the implications of outsourcing are felt in the way that costs need to be controlled without compromising on the quality of the works undertaken by the project team. As would be discussed in the section on cost overruns and the issues arising out of the same, the decision of which functions to outsource must be taken after cost benefit analysis is done and after due diligence of the proposed functions to be outsourced is carried out. ISSUES FOR CONSIDERATION IN CASE OF COST OVERRUN In this section, I consider the scenario of cost overrun by the government in its spending and allocation of resources for the infrastructure projects and hence have advised operating companies of impending shelving of some capital project works. This scenario presents the joint venture board with a fresh set of challenges that have to be met and would involve among other things, downsizing and reduction of spending on the maintenance and upkeep of the roads. The effect of the cost overruns would be felt on the areas for which funding would be cut and hence there is a need for prudent management of the costs to be reduced as a result of the slashing of spending. The first and foremost thing to do is to consider which areas of the project need to be curtailed. The identification of such areas must be done from a perspective of need and utility basis. For instance, the need for trimming overheads may be acutely felt in the areas of administrative costs and other expenses that come under the overheads category. If administrative costs are to be cut, the areas that need pruning would be the reduction of staff for non-essential activities. These might include secretarial staff and those members of the project team who would otherwise be redundant from the point of view of non-project perspective. Marketing and sales staff are one such category. Further, the staffs that are employed in the support functions that make up the labour costs may need to be cut. There should be an analysis of the costs along with the benefits that such costs might bring to the project. Such a cost benefit analysis is necessary to prune the excess costs associated with the project. Apart from overheads and salaries, there might be areas like suspending laying of new roads and extending the period for re-laying the roads that can be managed from a cost perspective. However, it is my firm belief that the joint venture board considers these cost cuts as the last resort and particularly from the perspective of road safety and upkeep. One of the points that have been mentioned is the shelving of capital works projects. What this means is that there might not be new funding for new roads and hence the joint venture board should take cognizance of this fact and keep in abeyance any new plans for roads apart from other capital expenditures. The point that is being made here is that in any organization there are areas in the project that can be subject to cost cutting without affecting the core functions of the project. Hence, efforts must be made to identify non-essential expenditure and prune the same. Instead of targeting the maintenance costs of the roads and the bridges, it would be better if the overheads be reduced. As it is the emphasis on shelving capital works means that new projects might be kept in abeyance. Hence, it should be the effort of the project team to suspend new projects while ensuring the ongoing projects do not suffer because of the reduction in expenditure and the cost outlay for the same is managed properly. CONCLUSION This paper has discussed a wide range of issues that arise because of outsourcing and reduction in capital outlay as well as the planning and programming issues that are part of the project processes. The paper has also considered the implications of these factors on the overall success of the project. Before concluding the paper, I would like to emphasize that the issues dealt with in this paper are part of any project that has new outlays as well as maintenance of existing works or projects that are ongoing in nature. The contract drawn up for the project is elaborate and comprehensive and the issues that arise from the same have been dealt with in a structured manner. In conclusion, it is the contention of this manager that project management should be viewed as a balancing act and a process where prioritization of the various components of the contract needs to be considered. Hence, the project manager should be able to rank items in order of importance and balance the needs of the stakeholders as well. It becomes imperative to view project management as an all round activity that encompasses the functions discussed in this paper. Read More