Introduction

The Aberdeen western peripherals route was mainly billed as a major project, which involved the travel in northeast Scotland. This project was aimed at improving the travelling but it turned out be a major headache, which significantly altered the financial condition. The firm, which is taken into consideration in the report, was one of the firms who was part of the consortium – with the partners Balfour Beaty and Galliford Try- that was awarded the contract to build the road in the year 2014 in the month of December.

The main aim of the report is to put focus on the project, the point out what went wrong in the project, and why did the project go wrong. The failure points are mainly discussed taking into account the concept of the project management and its ideas. The main area of the discussion would be on the projects organisational structure and the nature of the project.

The project was implemented with the main motive to improve the travel in northeast Scotland. The project eventually became a headache, which significantly hampered the financial condition. At the time of the initiation of the project, the decision to start the project was welcomed by both the Scottish government and the council, which is local to the area. There had been a long wait for the 36 miles (58 km) route and the project on the other hand was expected to provide thousands of job to the people who are local. The job was intended to be provided to those people who suffered as great loss due to slowing down of the oil industry.

After a certain period, the project became off the track taking into account the progress, which was expected from the project. This project was considered very much simple but it was relatively dogged by delay, which eventually pushed up the cost, and the left the firm with a serious problem related to the cash flow.

Problem faced in the Project (What Went Wrong)

The main problem, which was faced by the project, was the problem, which is related to the procurement. The main question, which arise in this factor, is that how can the contactor get the pricing and the timescale of such a major project wrong. As stated by Richard Steer who is the chairman of Gleeds, the contactor are basically the risk takers and this is where they can actually make the profit count. The basic thing, which every clients wants, is to minimize the exposure to the factors of the risk. The companies are forced to bid for 5 or 10 years at a fixed cost particularly when the client is related to the public sector body. The basic thing, which happen, is that the contactors have been pitching for the job and they put a basic price in relating to the project. After the initial process the contactors would talk with the sub contactors and then the sub contactors would come back with a much higher price that are more expensive than the estimated price.

An important part of the project management is the cost associated with it. It covers the scope of the project, budgeting and the estimation. Moreover, the cost control mainly ensures that the project stays within the borders of the financial aspect, which are broadly defined, in the budgeting process. Although the concept of the budgeting, estimation and the control of the cost are defined as three unaffiliated processes in the basic theory. They are very much strongly interacting and related. Significant for the concept of then project management is its basic concentration on the generation of the cost by means of the criteria of the performance of the schedule, which is related to the project. On the other hand, addition to this, it should also take into consideration the effectiveness of the cost management decision on the delivery of the project (Highsmith, 2013).

At this point of time, it can be mentioned that in many industrial application, for example the manufacturing industry of the product, the financial performance of the projects detailed is not taken into consideration. The responsibility for these major calculations are mainly distributed outside the framework of the project.

Labour problem and material

Taking into consideration the current situation the shortage of the labour also plays a very vital role in every project scenario. This is due to the factor that the cost related to the subcontractor. On the other hand, it is very much notorious to predict about the labour market and the cost of the material related to the project. The labour problem can directly affect the time framework of any project. The time lagging factor or if the project does complete within the predefined time would affect the financial sector of the project as well. This is a very important factor, which in the end would be destructive for the project (Portny, 2017).

Contractors are increasingly in order to manage the business environment. As stated by Mark Farmer who recently wrote a government commissioned report which was called Modernise or Die on the aspect of improving the construction efficiency. Although the concept of the employing sub-contractors helps in the field of the business avoid a large area of the concept of the payroll and keep the overhead concept very much down. The contractor is a very much important personal in a project. The contactors control all the factors of delivery of the raw material, transportation, managing the entire factor relating to permission needed from the higher authority (Stark, 2015).

The projects main construction started in the month of February 2015. The final data of the completion of the project was around one year from the date of start of the project. On the other hand, it was clear that the estimated time framework, which was set relating to the deadline, would not be able to meet. The factor of the time framework is very much crucial in any project. The factor of time comes into play when the project is not completed in the predefined time schedule (Morris, 2013).

For any form of project, the project model can be considered to one of the most essential factors that play a very vital role throughout the implementation process. The basic model, which was mainly used in order to achieve the desired standard of the project, was input – output model. The project was viewed as a conversion or a transformation of some input form into an output under some fixed set of mechanism to actually make the project a reality (Laudon & Laudon, 2016). The project would be be formulated under a set of controls measures or constraints – these elements are outside the project, which provide the basic of the assumptions and the limitation of the project. The mechanism concept are those resources, which make the transformation process possible. The main constants that should be taken into consideration while implementing the process of the project management are:

• Time: All major projects have a time constraint involved in them. In recent times, it is the most challenging part to meet. A project that meets the period work can be termed as a project, which has been planned very efficiently.
• Cost: This factor can be related to the timing and the value of the overall project. These resources play a very vital role in direct working of the project.
• Quality: This can be referred to as a standard by which the concept of the product and the process itself would be judged during the overall process (Rosemann & vom Brocke, 2015).

In addition to the above three, the following constraint also play a major role in the sector of the project management.

• Legal: The legal factor are sometimes not explicitly stated but the factor play a major role in the process. For example, a building cannot be constructed unless the major planning permission is taken from the concerned authority. If the permission is not obtained it can lead to a legal problem.
• Ethical: This can be considered as a major part in most of the organisations involved in the concept of the project management. It can be related to those organisations whose organisational policy have been questioned in the past (for example Nike and shell).
• Environmental: The deluge, which is related to the legislation of the environment that is generated by the government, has changed the role of the environment control from an issue of the subsidiary to one, which is at the forefront of the management thinking in different sector, which are many. Logic – There will be effect of the ripple which has to be taken into consideration before the project actually starts.
• Activation – It can be considered as a state when the project can be activated for started.
• Indirect effects: It can be stated that it is practically impossible for any change to take place in the process of the isolation. There would be some ripple effect, which has to be taken into consideration at the outset (Pemsel & Wiewiora, 2013).

Phases of project management

7S of project management

The 7S framework provides a set of comprehensive issue that should be addressed or taken into consideration. On the other hand, it allows a classification of the task within the remit of the project manager, which directly reduces the role complexity. This classification directly benefits the project manager and it would be help them to know what they should actually look for if any novel situation arises (Heldman, 2015). Knowing that the problem, which are related to the interpersonal in a team, are aggregated by the culture/style that a project manager promotes provides a means for the solution finding towards the problem. The following table illustrates the 7S of the project management.

Complexity of the projects

Not all the techniques, tools and the management ideas are accepted universally. The project, which takes one person to complete in one week, clearly has a very different managerial requirement from the multi-site (Fenton & Bieman, 2014). In order to obtain a meaningful conversation for the management for all the functions, a classification of the complexity level can be applied. The level of the complexity about an activity is a function of three features.

• Organisational complexity: The number of departments, the number of people, organisation, languages, countries and time zone involved.
• Resource complexity: The volume, which is related to the resources involved often, are accessed through the projects budget.
• Technical complexity: The level, which is related to the innovation relating to the product or the process of the project or the concept of the interface nobility between different parts, which is related to the product, and the processes (Fewings, 2013).

Characteristics of a good project plan

The following are the characteristics of a good project plan, which would directly help in stimulating the project in a timely manner and within the predefined budget framework.

• The people who are working in the project should exactly know what they have to do. In addition, the plan of their working should be very much clear.
• The workers who work in the project, the stakeholders and the vendors who supply the raw material should be on the same page regarding the concept of the project goal, processes and the timelines.
• The workers should demonstrate a sense of urgency and take into consideration the concept of the ownership responsibility.
• The respect between the workers and the stakeholders should exist in order to properly execute the project
• The workers should feel recognized and their mistake should not be pointed out in a forum.
• There should be a sense of genuineness and high expectation among the team should exist (Schwalbe, 2015).

The project budget management can be considered to an art of managing and developing a budget that covers all the part of the expenses and keep the project unsustainable in a framework of long run (Hwang & Ng, 2013). There are three steps in the budget preparation, which are follows:

• Estimate anticipated costs: This is the first step in a budgeting scenario. This is carried out to prepare an estimation of the project and to identify the expenses in the project. The key purpose of this step is to ensure that all the anticipated cost are expressed and estimated in a monetary amount, which is reasonable and tied to the project objectives and work plan (Boud, Cohen & Sampson, 2014). When estimating and planning the following checklist should be taken into consideration.
• Category “Personnel”.
• Category “Equipment”.
• Category “fringe benefits”.
• Category “consulting”.
• Category “consultant”.
• Category “supplier”.
• Category “travel”.
• Category “additional cost” (Larson & Gray, 2013).
• Justify the outline of the budget: After the first step, the outline of the budget is clear with the major details taken into consideration. Justifying the outline of the project is the second thing, which should be taken into consideration. The budget justification mainly involves three steps. The first step is reviewing every category of the cost for the concept of the accuracy, the second step involves confirming the overhead that can get involved during the execution of the project and the final step is the summarizing the review. This should be stated that second step ends up with developing a justification and budget, which is approved for the overall project.
• Ensure effectiveness of the cost: This is the final step for the preparation of the budget and it is all about the concept of the effectiveness of the cost. It directly means that the budget would be effective if it fully covers the aspect of all the cost factors that are incurred in the working of the project. This should be done with no underestimating and cost overruns (Mir & Pinnington, 2014).

Example of cost effectiveness ratio that can be used in the process of the budgeting

• Average cost effectives: Total Project costs / project effect.
• Marginal cost effectives: change in the total cost of the project / change in the project effect (Burke, 2013).

Recommendation

• Liaison meeting should be held periodically in order to discuss the overall working of the project and how the project is being processing. This meeting can be beneficial in many ways for example it would be helpful in interacting with the team members and putting together a relation between the different teams working in the same project.
• Each of the organisation should delegate responsibility to the field office or trhe representative in order to permit the work efficiency and the smooth working of each and every team members
• A joint supporting unit of accounting and administration can be set up in the field or some of the field office in order to directly speed up the procedures of the local purchase, field arrangement and the disbursement.
• In some of the cases it may be appropriate to create an autonomous body or a temporary project office by the pooling all the resources and the personnel in order to streamline the overall operation (Rosemann & vom Brocke, 2015).

Conclusion

It can be concluded from the report that there are few factors always play a very vital role in the process of any project. The main factor that play a significant role is the time framework and the budgeting. In the above report, it is taken into consideration these two aspects. If the stated two factors are taken care of and maintained it would directly affect the overall working of the project. The main issue, which is faced in most of the projects, are the time lagging factors. The time lagging factors if incurred into a project would directly affect the financial part of the project as well.

References

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