Edinburgh tram project case study

Essay title:

Evaluating how time, cost and scope effect the

performance of projects

Full name:

Registration number:

Programme:

MSc Civil Engineering

Course (class registrar):

EF 931 (David Butler)

Date of submission:

30/11/2018

Word count (excluding

cover page, reference list

and appendix if any):

2279

Evaluating how time, cost and scope effect the performance of projects Key words; projects success, projects failure, the Project Management Triangle

Abstract

In project management the iron triangle which consist time, cost and scope is fundamental factor on the project and it will eventually determine whether the project fail or succeed, the three factors linked together to make up the full stage of the project. The project failure is very important topic and using the risk management analysis will help project managers or organisation to reduce the risks of failure; Edinburgh tram was used as case study to demonstrate how over budget lead to project failure. Project managers and their experiences will improve the performances of the projects which eventually leads to the project succeed.

1. Introductions

The project triangle which consist; time, cost and scope will have impacts on the performance of the projects moreover it will evaluate whether the project succeeded or failed not just to the end of the projects however project many finish under budget and on time and it is still fail due to many reasons which will be highlighted bellow and managed using risk management techniques. The three main sectors of the project management triangle; or what is called the “iron triangle” are connected to make up the full project and these will go o circle as cost will affect how fast the project will take to complete and the time spent on the project will determine the quality of project. The purpose of this research is to find the effect of the management triangle on projects; and evaluate the other factors which can also effect the projects performances. Literature review was carried on the topic also case study was considered. (M.Bronte-Stewart, 2015)

2. Project success

The aim of every organisation is to succeed in their project in order to meet the client satisfaction. A project is also defined as task to create unique products or services; and to the definition on (M. Monteiro de Carvalho, R.Rabechini Junior, 2014) “A project is a unique, transient endeavour, undertaken to achieve planned objectives, which could be defined in terms of outputs, outcomes and benefits. A project is usually deemed to be a success if it achieves the objectives according to their acceptance criteria within an agreed timescale and budget”. This definition clearly shows that the project is demand on the three phases of the project management triangle. (P.Savolainen,J. Ahonen,I .Richardson, 2012) The project succeed depends on many factors and customers satisfaction is the most important factor perhaps the project stakeholders mainly work toward this critical path to achieve the best customer satisfaction rate. As stated in (P. Williams, N J. Ashill, E. Naumann , E. Jackson, 2015) it al depends mainly on customers. “Project efficiency (on-time; on budget; on scope) should only be measured as one of a package of five drivers of overall project success (project efficiency; team satisfaction; impact on the customer; business success; preparing for the future) thus providing a more holistic look at project success” (P. Williams, N J. Ashill, E. Naumann , E. Jackson, 2015) Therefore the project success is always uncertain and in many cases it takes long time to decide whether a project succeeded or failed; during the research it was found that project successes will improve the relation between the supplier and the clients which enables both stakeholders to have good interactions which lead to long term business relationship and nowadays the companies aims to have excellent relation with their customers. While in the other hand a lot of projects lead to end of businesses between suppliers and this is mainly is caused by poor customer satisfactions. (M.de Carvalho, L.A Patah, D. Bido, 2015)

Moreover the nature of the business will determine the relation between the client and supplier the study was carried by (P. Williams, N J. Ashill, E. Naumann , E. Jackson, 2015) . stated that project type will help to determine the term of relationship between the two parties in projects which includes heating, ventilation, and air conditioning systems will eventually lead to long relation between the suppliers and clients this is mainly due to the complexity of these projects as the company installed the system knows the system therefore it enable them to maintain it efficiently, finally the quality of these projects will lead to costumers reputations and will influence the success of projects. (M. Nicholas, 2016) Projects mangers are very important factor in every projects and many managers are became the reason why their projects succeeded or failed due to their contribution to the projects; and according to (R. Golini,M. Kalchschmidt , P. Landoni , 2015) “Project manager is a critical success factor (CSF) in a project, providing direction, goals, motivational support and assistance in resolving interpersonal and organizational issue” the project managers are very critical to defined the direction of projects in some cases even if the projects was going through challenging period if managements have the right skills and able to take responsibility they can play a good role to reduce the project failure and work accordingly to end the project with the best results.

3. Project Failure

Project failure is very important topic and many researchers have written about it; writers got their own ideas about the reasons for projects failure many thinks it is either project leadership or management teams however there are many such as the organisational type and the structure of it, involvement of clients and the training giving to the user scope and objectives setting, choice of methodology used in the finish products. Information and communications technology (ICT) projects are always the most risky projects and many of them lead to failure due to the nature of the work as it was stated in (M.Bronte-Stewart, 2015)organisations lost between $109-$135millions for every $1billion spent on ICT projects; these projects cost the global around 6.1 billons a year which is a lot of many being wasted and many organisations lost their money and people losing their jobs daily however those organisations are taking lessons from losing and the last couple of decades we noticed a huge change the performance of the projects as people started to be aware of the problems and many started to follow regulations and new approaches to reduce the risk of these projects to fail. (H. Salamah, 2014) Most modern projects nowadays are complicated due to the uncertainties that the world is going through which means the traditional way of managing time and scopes of projects are very difficult to manage; and therefore many project managers and organisations facing challenges every day. The project managers play very important role when it comes to reduce the risk of failure to their projects and mainly when following risk management techniques because it enable them to reduce the risk of failure; highlighting the risks at the planning stages eventually lead to improvements in projects performance moreover it reduces the uncertainties to the projects which lead to more control over the time and cost and as stated in the iron triangle(Project management triangle ) the two factors are connected the scope of project and therefore it develop a better quality of products. (Joslin, 2015)

4. Main discussion

The projects management triangle is very important frame for every project and it will therefore effect the outputs of the projects and study was formed by (Andersen, 2016) The study was carried out in Norway on postgraduate students to determine the perspectives of project managers on project management; they did the survey on Master students as they have experiences observing projects mangers and have a lot of ideas as they work closely with projects managers on different sectors.

43% project managers perceive their main objective as executing a given task

25% have their main focus on creating a desirable development in the receiving

28% project managers see project success as keeping to the project triangle

32% project success as achieving the purpose of the project even if it does not keep to the project triangle

Table 1 the results according to postgraduate students view of management triangles effect on projects

The results show that there are different perspectives when looking at the topic perhaps it depends on the nature of the projects when they did the survey many people responded with all the responses instead of choosing one therefore the researcher came to conclusions and stated that every project manager have their own way of trickling the tasks. (Andersen, 2016), Also stated “The different types of projects were executed in different ways. The challenge for the field of project management is to come up with an approach to project management, which takes into consideration different perspectives and proposes which methods should be used by the different perspectives” As stated in the sections above project managers will have an effects on whether the project was successful or not as their role is very important; depends on the experiences and the skills the project managers have it will enable them to control the projects by reducing the risks of failure this can be done by working accordingly and following management risks techniques will eventually improve the performance of the projects.

4.1 On time completion effect on projects

According to the experience of projects; it is very critical and important to every project manager to complete their projects on time in order to achieve the customer satisfaction, and to reduce the risk of project failure. On time completion it means better quality and less cost, which is how the project management triangle works ; it mean those three objectives are connected although in some cases this may differ and early finish project can also be poor quality or higher cost where in many cases a late project would be a good quality. Completing the project on time will improve the relationship between the supplier and customers as the supplier at least have done the required work on time and as promised to do during the planning stages. And by increasing the customers satisfaction rate it will eventually leads to increase to the cash flow and profitability of the projects can also improve the market share and stock price of the supplier. (P. Williams, N J. Ashill, E. Naumann , E. Jackson, 2015)

4.2 Cost effect on projects

As mentioned in section 4 it is very important to meet the customers satisfactions to have more work and reputations in order for the business to grow and the projects to have their full succeed; cost is very uncertain topic and that is the reason why most projects goes over budget due to many reasons and one of them could be the unseen problems during work or the difficulties the organisations have to estimate the total cost of a projects at the planning stages and this mainly to these large projects which can take years to finish. Although cost and time are very important

factors in every projects however they are not objectives which cannot be change in many cases cost changes during the stages of the projects moreover this does not mean the organisation does not have to plan cost at the early stages however an agreement with the customers that the cost of the project might increase and this could be highlighted during risk management. (P.Savolainen,J. Ahonen,I .Richardson, 2012) Many projects nowadays go over budget in some cases it is acceptable and it could improve the resilience of the projects life time but in other side it could lead to project failure and eventually customer dissatisfaction. An example of project failure due to costs and late completion is the Edinburgh tram project which was around triple the cost of the project, It was estimated the cost of the project to be £375 million however the total cost was over £1bn; the tram project was going through uncertainness which lead to under planning and then the work started however the project was running late which caused many disruption to the city leaving city residence suffer for six years of distortion to the rotes. And this failure to the project leads to delay to construct the second phase of the Edinburgh tram as the local authorities had bad experience in the first phase and mainly the triple cost of the project left the second phase uncertain and as hard task. (M.Bronte-Stewart, 2015)

4.3 Scope effect on the projects

If we consider the same case study Edinburgh trams was a successful project; good quality of services which is running very efficiently improving the transport linkage in Edinburgh to Edinburgh airport however the project failed due to the higher cost and the delay in constructions time; therefore scope of the project will be effected by the cost of the project and mainly the question would be asked when it come to the scope “Did the project meet the requirement? Is it function as required?” and question like these could last for a long time for the client to decide whether their projects met their requirement. (F. Asad Mir, A H. Pinnington , 2014)

5. Conclusion

The management triangle one of the most important factors in management and the three objectives of it have very strong connections; it means the project can fail if any of these sectors did not meet the customer satisfactions. Project manager also have huge impact on the projects performances; also the researcher concluded that the management triangle is in important factor however there are other factors which can affect the projects such as the management team leading the projects. To avoid project uncertainties risk management analysis should be considered at the early stages of the projects mainly to reduce the risks of project failure;

6. References

Andersen, E. S., 2016. Do project managers have different perspectives on project management?. Issue 34, p. 58–65. F. Asad Mir, A H. Pinnington , 2014. Exploring the value of project management: Linking Project Management Performance and Project Success. Issue 32, p. 202–217. H. Salamah, L. A., 2014. Challenges Leading to Projects Struggle in IT Project Management Office. Volume 11, pp. 262-271. Joslin, R., 2015. Relationships between a project management methodology and project success in different project governance contexts. Issue 33, p. 1377–1392. M. Monteiro de Carvalho, R.Rabechini Junior, 2014. Impact of risk management on project performance: the importance of soft skills. 3(52), pp. 321-340. M. Nicholas, H. S., 2016. Project Management for Engineering, Business and Technology and Technology. 7th ed. London: s.n. M.Bronte-Stewart, 2015. Beyond the Iron Triangle: Evaluating Aspects of Success and Failure using a Project Status Model. pp. 19-36. M.de Carvalho, L.A Patah, D. Bido, 2015. Project management and its effects on project success: Cross-country and cross-industry comparisons. Issue 33, p. 1509–1522. P. Williams, N J. Ashill, E. Naumann , E. Jackson, 2015. Relationship quality and satisfaction: Customer-perceived success factors for on-time projects. Issue 33, p. 1836–1850. P.Savolainen,J. Ahonen,I .Richardson, 2012. Software development project success and failure from the supplier's perspective: A systematic literature review. Issue 30, pp. 459-469. R. Golini,M. Kalchschmidt , P. Landoni , 2015. Adoption of project management practices: The impact on international development projects of non-governmental organizations. Issue 33, p. 650–663.