Sydney Opera House: Project Management Failures - Case Study Example

Sydney Opera House: Project Management Failures Name: Tutor: Course: Date: Table of Contents Table of Contents 2 1.0 Case study: Sydney Opera House 3 1.1 Overview 3 1.2 Main problem/issue 3 1.3 Objectives of the study 4 1.4 Key stakeholders 4 1.5 Sydney Opera House: The organization 5 1.6 The industry 5 1.7 History 6 1.8 Relevance of this study/Rationale 7 References 9 Appendices 10 Appendix I: Project costs (1957-1972) 10 Appendix II: Sydney Opera house 10 Appendix III: Sydney Opera house under construction 11 1.0 Case study: Sydney Opera House 1.1 Overview Joseph Cahill, the premier of New South Wales provided requirement for the construction of opera house in Sydney in 1956. This building was to have a large hall for symphony concerts, ballet and dance and a large scale opera hosting about 3000-3500 people. It also constituted a restaurant and meeting rooms for about 450 people (Jain, 2011). In 1957, Utzon designed the opera house based on firsthand accounts, shipping maps and photographs. Designed using computer-aided design, Sydney opera house was estimated to cost AUD$7M within the duration of four years. The opera house is undoubtedly one of the iconic buildings and a global symbol of Australia. 1.2 Main problem/issue Sydney opera house goes down as one of the most disastrous project not only from the whole management plan but also from the financial point of view. First, instead of falling within the estimated budget of AUD $7million and scheduled in four years, the project cost AUD$ 102 million and took 14 years to complete (See Appendix I). In this case, architects were allowed total freedom while costs and time limits were not provided. Although the funds came from a lottery fund, time planning was a total failure as the project which was deemed to open in 1963 took another ten years to complete in 1972 (Lester, 2003). Second, entrants into the project were not evaluated on the basis of their experiences in the design competition. However, there were no known methods to construct the roof proposed by John Utzon which required a ceiling of structural ribs and roof spanned without columns (Dixit, 2011). Third, the project did not have a project manager to undertake design, construction, and evaluation measures. Since implementation methods and goalposts kept changing, Haughey (2012) observes that some sections of the project were built gain, re-designed or demolished. Fourth, the expectation of the government on the project delayed the construction as design requirements changed from having two theatres to four theaters and associated increase in project cost. In 1966, Utzon withdrew from the project due to frustration and discouragement and went along with modifications, new designs and initial blueprints (Murray, 2004). As new architects took over, the cost estimates became highly inaccurate as costs skyrocketed 15-fold. 1.3 Objectives of the study a) To assess the political, social and economic impacts of the Sydney Opera house b) To investigate the organization and management of Sydney opera house during construction c) To assess the impact of Sydney opera house on the local community d) To evaluate the time, technical performance and cost constraints in the Sydney opera house construction project e) To find out the impact of innovation and construction technology on costs and sustainability of the Sydney opera house 1.4 Key stakeholders During the initial construction period, the key stakeholders were government of New South Wales, judging panel, architect John Utzon, structural engineer Ove Arup, Australian broadcasting corporation, Sydney Opera House Executive Committee, and the ministry of public works. The government of New South Wales was tasked with creating the project to serve the arts and had the urgency, legitimacy and power (Lester, 2003). The judging panel lacked the power once the design was chosen as they could only choose a design for the opera house. John Utzon along with Ove Arup oversaw project construction and design aspect of the structure. When Utzon resigned, Littlemore, Tood and Hall took over the roles of project manager (Mitchell, et al., 1997). Australian Broadcasting Corporation (ABC) as a dependent stakeholder with urgent and legitimate concerns wanted the proposed opera hall changed into a concert hall. Lottery contestants also contributed a larger part of the funds but had not power, urgency and legitimacy and can be classified as non-stakeholders (Mochal, 2009). The Opera House Committee (SOHEC) of 1957, a definitive stakeholder, was the main client of Utzon which addressed both constructional and architectural concerns to suit drama, music and traffic (Mitchell, et al., 1997). The Minister of Public Works had a role of supervising the construction work. Today, the government of New South Wales continues to oversee Sydney opera house opera house under Sydney opera house trust fund. Local community and tourists occupy public discretionary stakeholder portion the generate revenue through tours, concert sales, admission fees and other public events (Murray, 2004). Although they have no urgency and power, they exhibit legitimacy and immense value. The Australia public is a salient eye of the government who can boycott ticket sales and form protest groups. While being dependent stakeholders, they depend on the actions of the New South Wales government. 1.5 Sydney Opera House: The organization Utzon and Arup managed the design and construction Sydney opera house. The sponsor at the Apex of project organizational structure was the government of New South Wales led by Joseph Cahill. While Utzon developed architectural designs, Arup was tasked with the structural and engineering aspects of the project (Mitchell et al., 1997). Given that most of the architectural firms take over project management responsibility, Sydney Opera house was a diversion. Subcontracts who were also partners of Arup handled the acoustics, electrical and mechanical aspects of the project. In 1954, SOHEC was appointed to supervise the project despite their lack of engineering and construction experience and knowledge in delivering the project of this magnitude (Murray, 2004). The committee has three advisory panels for construction and architecture, traffic and one for drama and music. Later in 1960, the Minister for Public Works took over the role of supervision of the construction process and liaised directly with Utzon. 1.6 The industry Sydney opera house was created to serve arts, drama and music. Australia has a rich indigenous history in storytelling, music and art. With a blend of multicultural migrant Australians and Anglo-celtic, arts have become its national identity. Sydney Opera House alongside National Institute of Dramatic Art and the National Gallery of Victoria are notable institutions for the arts. Australian regional towns and capital cities thrive under independent culture through street art, art, film and music (Strategicppm, 2009). In 2013, recreational services and arts employed about 20.59% of the population with huge numbers visiting Melbourne to interact with the international street artists. Judged by merit other than snobbery, the art market has been democratized with a number of male artists using humor and expressive styles in their work. Australia is thriving with performing arts such as dance, music, folk music and national songs, pop and rock, classical music, theatre and country music (Anter et al., 2009). 1970s heralded the beginning of Australian theatre which saw the construction of Opera Australia, Sydney Opera house and Adelaide Festival Centre. Arts extol contemporary fusion of traditions with modern drama and music as exhibited in multi-cultural heritage of the many Australian cultures. 1.7 History The State Conservatorium of Music in New South Wales (NSW) led by Eugene Goossens in the late 1940s lobbied for the construction of the Sydney Opera House. This was because the Sydney Town Hall was getting smaller and smaller to host large theatrical productions. Goossens by 1954 won the support of Joseph Cahill, the then NSW Prime Minister, by calling for designs for a dedicated opera house to be located at the Bennelong Point. Joseph Cahill in 1956 announced the design of an opera house for Sydney through an international competition for a structure that contained two theatres. In January 1957, Jorn Utzon won among the 233 designs submitted for the competition based gull wings using architectural concepts and sail ships borrowed from the ancient Chinese. Scheduled to take four years, the original project budget was AUD $7 million. The goal was to have the grand opening at the start of 1963 after the project is completed by the end of 1962 (Anter et al., 2009). Until March 1959, the Opera House construction did not begin of which the project ended up at cost AUD $102 million and took 14 years to complete. There were three project phases: building the upper podium (1959-1963), construction of the outer shells (1963-1967) and the interior design and construction (1967-1973) (Murray, 2004). Ove Arup's engineering firm monitored the construction firm that commenced on 2 March 1959 (Strategicppm, 2009). Construction work was running 47 weeks behind schedule by 23 January 1961 due to unexpected difficulties. The issues comprised changes of original contract documents, construction beginning before proper construction drawings, unexpected difficulty diverting storm-water and inclement weather (Anter et al., 2009). In February 1963, work was finally completed on the podium (See Appendix III). Before a realistic solution was agreed upon, the design team from 1957 to 1963 observed more than twelve variations to obtain an economically acceptable form. The design work needed to understand forces that shells would be subjected to and the use of computers in structural analysis. As sections from a sphere, the shells were being created by Hornibrook Group Pty Ltd, the design team, by mid-1961 (Strategicppm, 2009). This design team, manufactured 4000 roof panels and 2400 precast ribs developed the construction processes and in an on-site factory. The precast units exploited the expensive formwork construction where roof tiles instead of being stuck on individually at height and prefabricated in sheets on the ground (Lientz & Rea, 1995). The construction of the shells was supervised by Ove Arup and Partners. Murray (2004) notes that the construction shells supported the different roofs before completion using an innovative adjustable steel-trussed ‘erection arch’. The Sydney opera house construction was completed in 1972 and was inaugurated by Queen Elizabeth II in 1973, after 17 years of cost overruns, underestimates and redesigns (Ziegler, 1973). By 1975 the building project had broken even because of the lottery system created for its funding (See Appendix II). Utzon was as an incredible feat of architecture who did not return to Australia to witness the final result of his work. Yet, he was honored in 2003 with the Pritzker Prize for architecture. 1.8 Relevance of this study/Rationale This Sydney opera house proposal on project management is significant for investigation for a number of reasons. To start with, the project did not adhere to the project triple constraints of time, cost and technical performance. The initial budget estimates was AUD$7million based on site surveys and incomplete design drawings (Strategicppm, 2009). Due to design changes in 1962, the first stage contractors successfully claimed extra costs of AUD $1.2 million. The estimated by 1963 showed a 47 weeks schedule overruns and AUD $5.2 million cost overruns (Philip, 2002). While the government demanded that the construction should be getting underway, Utzon protested the limited time for the completion of structural designs. Second, the changes in project scope meant the construction was to start despite the changes in client design requirements and the move from two theatres to four (Lester, 2003). This also meant that the designs and plans required modification during construction. Third, unclear and inaccurate client requirements created controversies in the second stage which affected the entire construction. For example, the competition entry shells had undefined geometry initially. This forced Ove Arup and partners to obtain an acceptable solution to its construction (Anter et al., 2009). Besides, it would have been prohibitively expensive if the formwork was done on in-situ concrete (Mochal, 2009). For each individual section, the construction of precast concrete would be expensive if there was no repetition in any of the roof forms. A new government in 1962 took over management and monitored all payments. The projects total cost was AUD$12.5 million by the end of stage one after Utzon submitted an updated estimate (Murray, 2004). The government then withheld payments to Utzon once no visible progress was seen while more payments were being delivered. Unfortunately, there were schedule delays in 1966 as work slowed down because Utzon felt his creative freedom was restricted and was being forced to resign from the project. With the idea not brought into his perfect fruition, the project was moving into Stage 3 where the project interiors were taking up so much of his time. Again, in 1965, the new Robert Askin government brought in some further changes that affected the project time and technical performance (Philip, 2002). For example, Askin gave the Ministry of Public Works the jurisdiction to supervise the project which put Utzon under massive pressure to finish the project. After his resignation in 1966, there was need to replace him and have new leadership. Three individuals were hired. Peter Hall was responsible for the interior design of which the government increased the number of seats to 3000 from 2000 (Murray, 2004). Lothar Cremer was hired as an acoustic advisor who stepped in with full criticism of the original designs by Utzon. Still criticizing Utzon's design, Peter Jones, the new stage designer suggested an overall overhaul of the interior design. As the interiors were completed in 1967, the total cost had rose to AUD$13.2 million. With final stage was eventually completed in 1973 Utzon's design underwent significant changes with the final cost at AUD$102 million (Philip, 2002). Fourth, there was no risk management done for unforeseeable risks from Utzon to the three engineers (Edwards, 1995). He had left no designs or sketches of the project because he was persuaded that he would be recalled once the new project team failed. For example, many unforeseen complications were found alongside the lack of designs to work with. This meant that new designs of the Opera House had to be created based on the current structure. Alone, these risks caused a huge increase, AUD$85 million, in the estimate of the total cost of the project. It seems Utzon was unfairly treated once the government accepted the new costs that shot up the total costs to AUD$102 million (Anter et al., 2009). On technical performance, the podium had to be re-built because the podium columns were weak to support the roof structure. References Anter, V., Hansson, E., McNaught-Reynolds, O., Tessar, A., (2009). The Sydney Opera House, Stakeholder Management and Project Success, Retrieved on March  1st, 2012, from: http://www.iei.liu.se/fek/svp/723g18/case_material/1.111101/SydneyOperaHouseProjectStudy.pdf. Dixit,P. (2011). Project Planning A Step by Step Guide, Toostep, Retrieved on March 24th, 2012; from http://toostep.com/trends/project-planning-a-step-by-step-guide Edwards, L. (1995). Practical risk management in the construction industry, Thomas Telford, London Haughey, D. (2012). Project planning and step by step guide, Project Smart, Retrieved on March 24th, 2012; from http://www.projectsmart.co.uk/project-planning-step-by-step.html Jain, N. (2011). Sydney Opera House, Office of the Chief financial Officer, Retrieved from: http://ocw.mit.edu/courses/civil-and-environmental-engineering/1-011-project-evaluation-spring-2011/projects/MIT1_011S11_proj_ex01.pdf Lester, A. (2003). Project Planning and Control, 4th ed. Oxford: Elsevier Ltd. Lientz, B.P. & Rea, K.P. (1995). Project management for 21st century. california: Academic Press, INC. Mitchell, R. K., Bradley, R., Agle, D. J. (1997). Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts. Academy of Management Review, 22(4): 853-886. Mochal, T. (2009). 10 best practices for successful project management. Retrieved on March 25th, 2012., From http://www.techrepublic.com/blog/10things/10-best-practices-for-successful-project-management/904 Murray, P. (2004). The Sage of the Sydney Opera House. New York, New York: Taylor & Francis, Opera House, 2012. Retrieved on March 1st, 2012; from http://www.aviewoncities.com/sydney/operahouse.htm . Philip, D. (2002). Sydney Opera House Site, Design, Construction, Costs, Retrieved on March, 1st, 2012; from http://www.twf.org.au/research/drew3.html . Strategicppm, (2009). The Sydney Opera House and Project management. Retrieved on March 2nd, 2012; from  http://strategicppm.wordpress.com/tag/sydney-opera-house/ Ziegler, O. L. (1973). Sydney Builds an Opera House., page 25, Oswald Ziegler Publications. Appendices Appendix I: Project costs (1957-1972) Appendix II: Sydney Opera house Appendix III: Sydney Opera house under construction Read More