Chunnel Project

Background

DEVELOPMENT PHASE

BACKGROUND
Enormous decision to link FRANCE and ENGLAND. The worlds largest Privatized Project.

It consists of Detailed planning Communication agreements Governmental approvals

DIFFICULTIES
Inflexibilities of some characteristics of project Cross-cultural exchange Two different companies, on two sides of project -British: Translink -French: Transmanche Speaking different languages Different Managing directors in PLANNING

Cost escalated from $5.5 billion to $15 billion Scope creep Setting up of IGC Huge organizational structure. Lack of Cost planning and management Who has GOLD makes the rules Over managing risk Lack of communication

Channel Tunnel project relations flow chart

Issues And Challenges

Project management areas Scope management Time management Cost management Quality management Human resource management Communication management Risk management Procurement management Integration management Development phase 2 3 2 4 2 2 2 3 3

RATING SCALE
5- EXCELLENT 4- VERY GOOD 3- GOOD 2- POOR 1-VERY POOR

1. SCOPE MANAGEMENT
The scope of this project was enormous, but had no hope of being profitable in the 20th century. This is the worlds largest privatized project, and scope creep played a large part in the substantial increase from its initial cost estimates and its completion time More burden on the contractors due to Scope Creep. Scope was very large and complex, which wasnt analyzed at during prefeasibility stage.

 Precautions to prevent Scope Creep were not taken into considerations. TREATY OF CANTERBURY and setting up of IGC to co-ordinate the approach , cost , operations and safety of the tunnel resulted in total loss of scope control of the project. The mistake of allowing IGC to have scope control without the ability of IGC to approve additional funding for scope creep affected the management of this project.

2. Time Management
Time management was done fairly effectively in initial stages but with progress rise in scope contributed to TIME DELAY Disturbance in scheduling occurred when IGC interferred (external factors). However the project status report( 3 month basis) contributed to reduce the chances in further delay.

3. Cost Management
The project was funded by banks and stakeholder but it was not financially supported by governments. Scope creep : Uncontrolled growth in scope of work led to increased cost of construction. The project had constricted fund-flow due to minimal risk approach of banks. Golden rule he who has money makes rules wrong approach. Overmanaging risks also led to increase in cost. Too much focus on quality and safety.

QUALITY MANAGEMENT ASPECTS

ORGANIZATION AND ELEMENTS INVOLVED
THE JOB OF QUALITY MANAGEMENT WAS ENTRUSTED TO IGC
THE IGC COMPRISED OF CIVIL SERVANTS FROM UK AND FRANCE THE QUALITY MANAGEMENT PLAN INCLUDED THREE ESSENTIAL ELEMENTS VIZ. QUALITY PLANNING, QUALITY ASSURANCE AND QUALITY CONTROL

QUALITY MANAGEMENT ASPECTS CHALLENGES BEING ENCOUNTERED

INVOLVEMENT OF TWO NATIONS DIFFERNENCE IN STANDARDS AND SPECIFICATIONS DIFFERENCE IN THE METHOD OF EXECUTION, MATERIALS BEING USED INVOLVEMNET OF MULTIPLE NO. OF AGENCIES AND THE COORDINATION BETWEEN THEM DIFFICULTY IN INTERPRETATION RELATED TO STANDARDS AND SPECIFICATION ADHERENCE TO QUALITY REQUIREMENTS AND MAINTAINING COST CONTROL

QUALITY MANAGEMENT ASPECTS APPLICATION

ISSUE OF STATUS REPORTS DECISION TO CHANGE 600 MM DOORS TO 700 MM DOORS RESOLVING ISSUES RELATED TO DIFFERENCE IN STANDARDS BETWEEN THE TWO COUNTRIES

QUALITY MANAGEMENT ASPECTS STRENGTHS

HIGHER OF THE TWO STANDARDS PREVAILED QUALITY OF THE PROJECT WAS GIVEN HIGHEST PRIORITY USE OF ADVANCED TECHNOLOGICAL EQUIPMENT LITTLE MARGIN OF ERROR ALLOWED

QUALITY MANAGEMENT ASPECTS NEGATIVE IMPACT

SCHEDULE DELAYS COST ESCALATION

5. Human Resource Management

There was no team work or co-ordination between the two parties involved in the project. One of the merits was , for every British team member , the French had a matching counterpart. There was a motivation for the workers involved but during later phase it was missing. Arousal of mistrust between the two parties because of the governments moved further away from the team-work concept . It was worth remarkable to work with 15000 workers beneath ground with no casualty.

6.Communication Management
England and France are traditionally opposing cultures with different mindsets and modes of communication. Two different companies having different managements, different cultural backgrounds and thought processes planned the project from either end of it. The respective governments refused financial commitment to the project, forcing each project team to save its own financial interests, further hampering mutual communication.

Communication Management
The French and English teams progressed from either end of the project towards the center, delaying communication until the very end stages of the operations. The quarterly status reports, though consistent, were prepared individually, and with little mutual consultation. The multiple compensation methods were not adequately defined in the contracts, encouraging the banks to emphasize on the least defined ones.

7. Risk Management
Risks indentified were:1. Relationship between banks and contractors. 2.Technical advanced equipments for construction which were not required. 3.Economic condition-the projected operating revenues of the tunnel project depended upon economic growth of UK and France. 4.Completion delays and cost overruns 5.Construction risks - floods,fire, ground collapse

7. Risk Management
Measures taken: 1.Select a manager of the project independent from the developers 2.Identify the correct equipment to be used to reduce the cost of the project. 3.The government should undertake certain policies to keep operating costs stable. 4.A structure of penalties should be put in place for delays and reward for timely completion. 5.Use of techniques (example-probing) to identify earth conditions (fissures) before execution.

8. Procurement Management
The procurement management was fair enough in this phase. Procurement for this phase consisted of selecting professionals to execute the complex project, ascertaining responsibilities ,working on contracts and contractors. The selection of professionals for preparing contract for this complex project was not an easy task. Rating - 4

Risks for integration management

Inadequate planning Resource allocation Lack of clear objectives and key success indicators

9. Integration management
The integration management in this phase was good because it consisted of 2 main contractors and 46 sub contractors and many suppliers. It is very complex task to integrate such amount of variables from very different cultural background.

SWOT ANALYSIS
Strength: Use of latest equipment and technology to execute the task. quality of construction and materials used. Well planning and understanding complexity of project. Opportunity(for improvements) Communication between main contracting companies. Lack of techno managerial skills in IGC personnel. Lack of government support. Design specifications were stricter than required. Weakness: Overruns of budget. Delays in project (19 months total delay). Over managing risks.

Threats Excessive power to banks for project control. Threat from IGC for approvals. Man made and natural calamities threat.

Findings and Conclusions

1. Adequate planning of schedule - although a year late. 2. Significant success in delivery quality. Project team did a reasonable job in planning the technical equipment and understanding the complexity invovled. Previous data for soil and projects used effeciently.

3. Higher degree of quality insured because the free reign given to IGC. "Better of the two methods" adopted. Advanced technological equipment used.

4. The focus on fairness was followed by the both governments involved. For every British team member French has the counter part.
5. The project office did an adequate job and followed some of the planning, designing and retailing required in this phase of project. 6. Scope Functional requirement and technically specifications need to be defined and validated as early as possible. The lack of continued focus on scope, resulted in the frustration of trying to do too much

7. There were many things that made this phase difficult , including the Inflexibility of some of the characteristics of the project - Communication : Lack of communication Differences in opinion. 8.There was much interpretation for the agency like IGC . Had The project management team be given enough authority to act in the best interest of the project, time delay could had been avoided.

9. Scope was not fully assessed and the proper precautions to prevent scope

Lessons learnt for future projects

The project Must have sufficient government support, if it is possible, government should be involved in the project as one of shareholders. Furthermore, must keep a close communication with government.

 Before starting the project, all shareholders should have a common interest and detailed understanding about the project. Must have a long term plan (long term project), aborative R & D, advance design and an effective organization structure, in order to avoid changes and reduce loss during implementing project.

communication system Risk, change management Eliminate unnecessary changes