Project Management for the Port Adelaide Flower Farm - Example

PROJECT ANALYSIS VALUE Executive summary Project management defines the capabilities of a person thereby highlighting the especial management qualities as risk taking and leadership that need to be used in project management. Innovation in project management and developmental processes makes the skills to be used by the beholder in an effective manner. The ideology that makes the project managers behave as they do is that they visualize themselves as the risk takers and the leaders with creativity. These skills as they see make them deliver the project in the best manner with focus on decisions and project completion. Being a common activity in any organization, projects are of one too many kinds ranging from construction, relocation of workplace, launch of new merchandise, a new service for the customers or launch of new commodities’ promotional packages. The definition of project management is the application of discipline, rationale, leadership talents and problem solution. Without any completion date, commitment, management and involvement of stakeholders the project cannot succeed to completion. The value of the project is counted by the deliverables associated with the project. Life cycle of the project leads to successful understanding of the incomes and outcomes of a project thus creating possibilities for completion of project. All information related to a project must be in place or the chances of completion of the project are lowered. All the above factors contribute to a project being successful otherwise it is seen that even the best managers fail to successfully complete the project. Project: The Port Adelaide Flower Farm Project introduction The project dates back to the year of 1988 when the local government minister asked the Corporation of the city of Adelaide to develop a scheme so as a farm could be developed on LeFevre Peninsula and the purpose had been to develop the native plants of Australian region. As this project was a government sponsored project so it took a year to establish a controlling authority for the project (Kerzner 20). Flower farm was supposed to be a new project as well as it was thought to be a new industry that could prove to be better in years to come. It was thought that the flower farm would be the place where Australian native plants could be cultured and sold out to international traders (South Australia Auditor-General's Dept 12). The local city government’s council had been taken the responsibility to manage the project. The supervisory board had been established by the council and it was the responsibility of the board to submit the financial statement related to the project to the board. However the project failed after some years and the reasons of the failure shall be discussed hereby. Stakeholder analysis Stakeholders for this project included the supervising board and the council that had been established to conduct the farm project. The layout for the project was issued for the stakeholders including the plan layout and the financial calculations showing that the project would be highly profitable. Regular reporting to the council members had to be made sure so that the achievements, if any, gained in the project could be evaluated (Meredith 50). After the farm had been established than the losses came on the front where the reasons of losses were attributed to bad weather and the unfavorable market conditions that were apparently out of council’s control. Dr Brian Freeman of International Horticulture (Marketing) Pty had been the consultant to flower growers and also to the native plant exporters. He met the council members for the project in this meeting it had been decided that the native plants of Australia shall be grown so as to export the flowers to the international traders. A written proposal had been passed on to the council members that was inclusive of the risk analysis, and the financial matters especially the project design as well as costing. Council had given the project proposal to the ministry for its approval with all the proposals and the recommendations and only after it had been approved the work on the project had started (Pitagorsky 22). The council members had been diligent about the project in the beginning bit since the first step it is felt that a deeper analysis of the project was the requirement which had been overlooked. Although the part of risk analysis had been included but the proper analysis was the requirement. In addition to this the experts to the flowers and the native plants had not been taken into consultation where this might have helped to gain an insight into the risk analysis (South Australia Auditor-General's Dept 15). Management of the project 1. Cost estimates The most important part of the project management had been the feasibility study that was inclusive of the detailed analytical study on the infrastructure of the project. All the details related to the infrastructure of the project needed to be ascertained along with all the costs and finances. All the steps leading to the establishment of the farm needed to be laid down. The previous meeting with Dr. Freeman and the council members came to the conclusion that the cost estimates for the establishment of project plan will be made on the broad estimates (Project Management Institute 25). In the end the plan when submitted to the council, it was noticed that the cost of the project plan had been higher than previously discusses. The major reason for higher costs had been the increasing labor cost and the farm employees were asking for higher pays on weekends. Security measures also added up to the estimated cost (South Australia Auditor-General's Dept 20). 2. Marketing strategy Marketing strategy that needed to be incorporated in the project plan had to be inclusive of the farm’s product. All the flowers and the native plans that the farm had to product were to be marketed internationally to make the buyers trade the plans and the flowers. However the lag had been the absence of marketing strategy from the business plan. In a Meeting held previously, Dr Freeman made it clear that the Australian native plant Kangaroo Paw had to be marketed in the other countries including Japan. The time period of this marketing was mentioned to be till the coming period of mid November so that a margin of period is in the hands of the growers to grow the demanded native plants by the time they are to be handed over. 3. Project pilot trial Dr Freeman had made various suggestions to the council members of the project including the conduction of a pilot trial on the farm project. He added that this trial will help in making the council members learn how the native plants grew and how they needed to be grown in the farm. In addition to this, the conditions internal as well as internal that thee native plants required can be experimented so that better conditions can be provided where needed. 4. Risk analysis The meeting was inclusive of the discussion of the risks that the project held and it had been made clear by Dr Freeman what risks needed to be approached while working on the project. Risks included the weather conditions that might keep on changing as the climate changes or the drastic weather changes can cause the crop output to decline to some extent. This is the major risk that needed to be dealt with as the low output of the crop was not acceptable. The risk required a streamlined risk management and for this the cooperation of expert plant growers and flower exporters was required. These people could help by incorporating their expertise when the lower crop output was being expected. Failure of the plan 1. Low Income in 1989-90 Financial Year It had been originally planned that the plants will be seeded in the spring of 1988 instead the seeding began in the winter of 1989. This was the main reason why the project made lowest income on the year of 1989 and 1990. Kangaroo paw had produced the flowers and they did make some positive changes in the budget however the flowers were not saleable as the flowers has been damaged owing to extreme weather conditions. 2. Lack at the council’s end It was made sure in front of the council members that the project would be profitable and will bring a rise in the income however the major lag was that except Dr. freeman no one else made the risk analysis of the project for the council members. All the reports of the project that were being presented to the council were not based on reality and factious assumptions were made on the costs and especially the risks (Harrison 10). 3. Selection of the plants Council members were to select the plants with proper expertise and in the case of Kangaroo Paw that the plant had been chosen without any expert flower grower and no idea had been established as to what specie of the plant flowered in which relevant season. 4. Financial losses The annual losses recorded as per the audit report had been US$ 3 million. The reason that were estimated after the losses had been realized was that the plants were not selected according to the flower characteristics, foliage characteristics, stem characteristics, packaging characteristics and this also included the documentation and the treatment details of the plants. 5. Marketing failure The quantities of the flowers that were in demand from the international market were not produced adequately thereby the market for the native plants and flowers failed. Climatic conditions required were not analyzed and that lead to the lower quality of yield in the flowers whereas the higher numbers were shown to be anticipated in the experimental reports where the experiments were conducted on a smaller scale (South Australia Auditor-General's Dept 40). Critical analysis Council members had been diligent when the project plan had been handed over to them however the main lag was of detailed risk analysis (Heerkens 20) and the expertise that were not referred to by the council members being unaware of the requirement of the expertise (Berkun 10). It should have been made sure that the major step had been the plant selection and that should have been done along with the expert flower growers and flower exporters. These people would have given an insight into the climate conditions and the packaging details, the absence of which lead to the financial losses (Gray 20). Conclusion Risk analysis and the references to be made to the expertise is the most important part of project management. Any project needs to be calculated in reference to the costs based on the real costs. The experimentation if needed needs to be carried out at a larger scale. Appendices Table 1: Financial cost estimates for the project Table 2: The plant Export Data Table 3: Farm’s Income Table 4: Farm’s Budget Comparison Table 5: Farm’s Capital Expenditure Table 6: Farm’s Balance Sheet Table 7: Funding Requirement by the Farm Table 8: Income and Budget Comparison of the Farm Table 9: Farm’s Operational Results References Berkun, Scott. Art of Project Management. Oreilly & Associates Inc, 2005 Gray, Clifford., and Larson, Erik. Project management: the managerial process. 2nd edition. McGraw Hill Professional, 2002 Harrison., and Lock, Dennis. Advanced project management: a structured approach. 4th edition. Gower Publishing, Ltd., 2004 Heerkens, Gary. Project management. McGraw-Hill Professional, 2001 Kerzner, Harold. Project Management: A Systems Approach to Planning, Scheduling, and Controlling. 9th edition. J. Wiley, 2005 Lewis, James. Fundamentals of project management: developing core competencies to help outperform the competition. 2nd edition. AMACOM Div American Mgmt Assn, 2002 Meredith, Jack., and Mantel, Samuel. Project Management: A Managerial Approach. 6th edition. John Wiley, 2005 Pitagorsky, George. The Zen Approach to Project Management: Working from Your Center to Balance Expectations and Performance. www.iil.com/publishing, 2007 Project Management Institute. A Guide to the Project Management Body of Knowledge 2000. Project Management Institute, 2000 South Australia Auditor-General's Dept, K. I. MacPherson, South Australia, Auditor-General's Dept. Report of the Auditor-General Pursuant to Section 32 of the Public Finance and Audit Act 1987: Port Adelaide Flower Farm. Auditor-General's Department, 1997 Read More