Advanced Project Management: Greater Gabbard Wind Farm Mega Project
Management Approach of GGOWL Mega Project
Greater Gabbard Wind Farm Mega Project is a massive project that sought to make massive contribution into the energy sector. The management approach taken in this project would dictate its success or failure. As shown in the case study, this mega project took the form of project management in its management approach.
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According to Harvey (2005, p. 56), it is always important to understand the needs of a project, and its magnitude before choosing on the appropriate management strategy to be used. This scholar says that relatively small projects with small budget expected to take short duration of one year or less should always take project management approach.
This is because they are less involving. However, mega projects that are very involving and needs a lot of money and longer time to complete may need to take the form of portfolio or projects approach in its management style. Managing mega projects as a portfolio helps in ensuring that each of the major tasks is assigned to the most qualified contractor in order to achieve the best results. The contracted firms would work closely to ensure that the overall objectives of the project are achieved successfully.
Greater Gabbard Wind Farm Mega Project was managed as a project, and this may explain why it was assigned to one contractor, Fluor. Scottish and Southern Energy (SSE) and RWE Innology, as the owners of this mega project, considered to contract only one firm to undertake the entire project. This means that the management did not consider developing a portfolio of programs and projects out of this mega project.
It is true that SEE contracted Siemens for the turbines to be used in the project. However, it would be wrong to assume that this move would be considered as an effort to create portfolios or programs in this project. Flour does not have ability to develop turbines, and it was a fact that at some point they would have sourced for them from other companies. What SEE did was just to help them get these materials without having to struggle in getting them. All other activities in this project were assigned to this single contractor.
This management approach could be the major reason for the challenges that this project faced in its implementation process. It is a fact that Flour is one of the pioneers, and therefore, it had the vision of the project. It understood very well how the project was supposed to be implemented in order to achieve the desirable results.
This could be the reason why the owners decided to award the entire project to it. However, it would be important to appreciate the fact that this was a mega project that had never been witnessed in this country. The United Kingdom had never developed such a mega wind energy plant before, and this means that the stakes were very high. The owners made a wrong decision of assigning all the tasks in the project to a single contractor.
The best approach should have been to create a number of programs in this mega project, and assign each program to different contractors based on their qualifications. This would have helped in shortening the time for completion of the project. The strategy would have also helped in ensuring that each of the tasks is completed in a more professional manner.
Approach to Stakeholder Management
Mega projects such as Greater Gabbard Wind Farm Mega Project always involve various stakeholders. According to Hamilton (2004, p. 46), it is always important to determine all the stakeholders involved in a given project with the view of understanding their interests in the project.
This scholar further says that some stakeholders may have enough powers to influence a project positively or negatively. For this reason, the management unit of a project must know these players and then devise the most appropriate approach that can be used to take care of their interests. Engaging the relevant stakeholders in a given project is a major step towards achieving success in the project. The model below shows stages that should be taken in stakeholder engagement process.
Stages in stakeholder engagement process
Source (Schwalbe, 2005, p. 77)
As shown above, the first step is to identify the stakeholders. This involves identifying people who will be affected by the project, experts who can be of use in the project, and forces that may affect success of the project. The next step would be to understand their needs. The project management unit must understand the needs of all the stakeholders identified in the first stage, and how these needs are aligned to the needs of the project.
The third stage involves managing the stakeholders’ needs and expectations. There are cases where some of the needs of the stakeholders are not in line with the project objectives. In such cases, it may be necessary to manage these needs and convince them to settle for less in order to make the project successful. The last stage would be to check for the needed changes. This may occur when regulatory authorities consider some of the strategies the project considers to take as inappropriate.
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In such cases, it would force the project management team to make necessary changes in the project to be in line with some specific policies. GGOWL Mega Project did make an effort to follow this model in an effort to manage stakeholders’ needs and expectations. Some of the major external stakeholders identified in this project included Greenpeace Friends of the Earth, National Federation of Fishermen’s Organization, Tourism Board, and Marine Flora and Fauna.
Other stakeholders included Royal Yachting Association, Natural England, and Port Authorities. These stakeholders have varying interests and influence this project to varying degrees. The project management has clearly documented their interests and the degree of influence they have on the project.
According to Hamilton (2004, p. 56), it is always important to align stakeholders objectives in order to achieve the desired results in a given project. The project management team in GGOWL Mega Project made a concerted effort to ensure that stakeholders’ objectives are aligned with the objectives of the project in order to make the project successful.
As shown in the case study, the management identified all the major stakeholders in the project. Each stakeholder was analyzed based on the interests and level of influence to this project. This makes it possible to align the interests with the objectives of the project. The degree of alignment can be improved by using some of the known models such as the one below.
Source (Schwalbe 2005, p. 67)
As shown in the model, the focus of the management would be to identify the interest of the stakeholders, and their level of influence. Priority should always be given to highly influential and very interested stakeholders in the project.
Approach Adopted For Change Management
In mega projects, it is always common to encounter scenarios where changes are needed in the implementation of the projects. The approach taken in change management is pivotal in realizing success in the project. As Harvey (2005, p. 88) notes, mega projects that take several years to be completed are prone to meet several changes in the external environment.
When such changes arise, it becomes necessary to adopt an approach to change management that would help align project objectives to the changes taking place in the environment. For instance, cost of the project is one of the most probable change that should be managed very closely. In GGOWL Mega Project, the work was scheduled to start on May 2008.
This means that the feasibility study was conducted earlier, most probable in 2007. It would be important to note that there was a serious economic recession in this country that started in late 2008. The feasibility study, which was conducted before the onset of the recession, formed the basis of setting the budget, hence the total cost for the project. However, when the project begun, the country was hit by the 2008/2009 economic recession, which was a completely unexpected turn of events.
The implementing party in this project had to find a way of changing with the changes in the economic environment, and it is clear from the case study that this posed a serious challenge. This may be attributed to a series of changes in the completion date that the contractor was forced to make in an effort to manage the constrained budget.
This project has taken two different approaches in managing changes that may arise during its implementation stage. The owners of the project have maintained a flexible approach in determining the time of completion of the project. However, it has a very rigid approach when it comes to expanding finances of the project. This is evidently presented in the case study. Originally, the completion date for the project was set to be by March 2011.
This was changed to end of 2011, summer 2012, and finally end of 2012. In all the three changes, the owners of the project did not take issues with the contractor over the delay of the project beyond the initially agreed date. However, when the contractor mentioned that there was a need for some extra cash beyond the initially agreed amount, the request brought a lot of issues that forced the contractor and the owners of the project to go to court.
With the court ruling in favor of the owners, the contractor had to count losses while completing the project. To be flexible in terms of time for completing the project is fine, but it should not be tolerant of constant postponement of dates.
The system should not allow the third postponement of completion date unless something justifiable enough takes place. Similarly, the financing party should have some form of miscellaneous budget to support the contractor in cases where it considers it justifiable enough. This would avoid the risk of poor project completion due to limited time or finance.
The Perception of Success
The perception of success is dependent upon the delivery of benefits. In every project, there is always the perceived success that people will have upon its completion. According to Harvey (2005, p. 112), different stakeholders will have different perceptions of success towards a given project based on their interests. In this GGOWL Mega Project, different stakeholders have been identified, and it has been stated that each stakeholder has different expectations of the project.
For instance, the government hopes that when completed, this project will be able to provide 5% of the energy needed in this country. This will be in line with its plan to increase the percentage of clean energy in the country as a way of reducing pollution. This expectation defines the hope this stakeholder has towards the project, and the perception of success.
The government will consider this project successful when it is finally completed, and with the ability to provide the expected percentage of clean energy to the national grid. The benefit that this project will be expected to deliver to the government is to contribute this percentage of clean energy to the national grid. When this project is capable of providing this amount of clean power, the government would consider it a success.
However, when this is not achieved, then the perception of the government would be different. Other stakeholders have different expectations of the project. The owners are looking forward to getting good returns from the project because to them this is a business venture.
Environmental watch groups are looking forward to having clean energy. Their perception towards success of this project is based upon the ability of project to deliver the desired benefits. Just as Hamilton (2004, p. 85) confirms, the perception of success is dependent upon the delivery benefits.
It is therefore, very important to manage the uncertainty, risks and the planning horizons as a way of ensuring that the interests of all the stakeholders are taken care of in the project. The project management unit must ensure that uncertainties and risks are managed to ensure that the project delivers the expected benefits to the stakeholders.
Once it is stated that specific benefits are to be delivered to given stakeholders, all associated risks and uncertainties should be eliminated to ensure that the expectations are met. This is important because the project should be successful in the face of all stakeholders. The planning horizon should also be considered as part of the benefits that should be delivered to the stakeholders.
For instance, the government has estimates per given date of the amount of green energy that should be available in its national grid. When the project promises to be ready for output as per given date, this should be honored in order to help the government meet its estimates.
The Approach to Risk Management
Managing risks in a project is one of the core activities that require concerted effort from all the concerned stakeholders in order to achieve the desired success. According to Davidson (2003, p. 89), risks can be predicted and mitigated, but they cannot be avoided when developing a project.
This scholar says that project management team must understand factors in the external environment that may pose risk to the project, and be proactive in addressing the identified issues before they can affect success of a project. In this mega project, several measures have been taken by the owner to manage risks that are associated with this project.
The project management has conducted a detailed soil investigation in the area where the project will be located; it has collected site specific wind data, and developed conservative array spacing to minimize array losses. It has also incorporated the use of the latest technology to ensure that maximum success is achieved in the project.
This shows that the management is determined to ensure that all the associated risks in this project are minimized as much as possible. The strategy taken is proactive in nature, a fact that makes it possible to manage the unforeseen risks in the project.
The management has however, failed to be proactive in managing the possible financial risks that may arise in the project. In all its risks management plans, the management did not have a single strategy that is focused on managing the unforeseen financial risks. Unfortunately, the project is hit by one of the worst economic recession this country has ever witnessed soon after its start.
This proves to be one of the biggest challenges for the project, and the fact that it was not planned for makes the situation even more critical. However, this can be improved to ensure maximum benefit realization in the project. The management should make an effort to ensure that it remains proactive in all fronts, including coming up with measures of mitigating financial risks in the project. The proactive approach taken in managing other related risks should be reflected in managing financial risks.
The Project Approach to Benefits Realization
The approach taken by this project to benefit realization is very appropriate. The benefits have been defined on the basis of the involved stakeholders. There were six stakeholders who had specific benefit from this project. The project was to contribute 5% of the United Kingdom’s renewable energy, and this was to benefit the government.
Airtricity benefited by selling its shares of the project to SSE at about four times the value of the price it bought the shares at in 1997. RWE, one of the owners of the project, was to benefit this project by creating a diverse portfolio of energy generating sources in the country. SSE would benefit from this project by creating investment portfolio. Siemens was awarded the contract of delivering turbines, and it will benefit from the sales of the same.
Flour was given the tender of implementing the project, and it will benefit from the profits on the contract. It is clear that each stakeholder has specific area of benefit that is to be achieved once the project is complete. It would be important to note that all the stakeholders depend on the successful completion of the project in order to reap the benefits.
This approach could be improved by breaking down the benefits into smaller units to be achieved stage by stage. The benefits would be measured at these smaller stages, instead of determining the benefits only when the project is completed. The procurement route taken by the management was very beneficial to the contractor because it eliminated the need for the firm to look for the turbines.
List of References
Davidson, M 2003, Frame Managing Projects in Organizations, How to Make the Best Use of Time, Technique, and People, John Wiley & Sons, New York.
Hamilton, A 2004, Handbook of Project Management Procedures, TTL Publishing, New York.
Harvey, L 2005, Project Portfolio Management, A Practical Guide to Selecting Projects, John Wiley & Sons, New York.
Schwalbe, K 2005, Introduction to Project Management, Course Technology, New York.