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5 - Heathrow Terminal 5 case study

Abhay Vikarm 140040113
Akshat Kejriwal 140040007
Anurodh Mehta 140040042

1. Should the management GO/NOT GO ahead with the opening ceremony as
planned? Why or why not?

Short answer: The management should GO ahead with the ceremony as planned.

Longer answer: The chances that the terminal will not operate as planned are almost
certain, what with the terminals IT systems not sufficiently tested, several areas still
under construction, and a BA staff not entirely familiar with the airport systems because
of the first two reasons. That being said, the loss in revenue and brand value would be
far greater it seems, if the airport opening was delayed by an entire 6 months. From the
case, we already know that all the tickets were sold a year in advance, and rescheduling
all these flights would not be possible with a simple two-week notice. When Denver
International Airport delayed their opening, it cost them an approximate, $1 million per
day in operations cost and interest. Delaying the opening of a project which was in the
works for 20+ years, would cause irreparable damages in terms of public trust amongst
other intangibles.

The basic airport systems, have been tested (not sufficiently, admitted, but they have
been tested to an extent) so we have an idea of how much they can malfunction and
look to contain the damage when they do.

Simply speaking, while there is no easy solution, we can look to compare damages done
in both cases (of opening and not opening) and see which case results in minimal
damage. In case we open we risk some passengers being disgruntled, some
complaints, some loss of public image all of which can be recovered. If we do not open,
then we will almost certainly face the wrath of ALL passengers, not to mention several
national and international airlines, and the British Govt. as well.

2. What are the key challenges to project management as highlighted by this

Ans: The main challenges highlighted (I think) are as follows:

1. Communication problems between the concerned parties (namely the BA and
the BAA). The greater is the complexity of the project, and more are the number
of parties involved in one greater is the need for proper and thorough
communication on the sections and sub-sections of the project regarding
specifications, deadlines, final goals etc.
2. Submitting the project deliverables on time. As per the case study, According to
BAA, 80-85% of the project deliverables were completed on time at T5,
compared to only about 60% in the general construction industry, so they feel
their innovative approach has worked very well But in fact, even if 10-15% of
the deliverables werent submitted on time, the overall project would get
delayed, and depending upon how crucial those deliverables are, immensely so
at times. This is a major problem with all construction projects.
3. IT systems: These were issues that both the passengers and the staff had to
contend with.
4. Lack of testing: There was uncertainty in the quality of the deliverables because
of insufficient testing of systems already in place.
5. Building delays: Again, connected to the second points. But construction delays
affect almost all civil engineering projects.

3. What would you have done differently from the project if you are manager or this
project? What things would you have adopted as is?

Ans: Things I would keep the same

1. The contracting approach to the project which consisted of BAA holding all the
risk so that the contractors could focus their energy to being on-time and on-
budget. This strategy also encouraged the vendors to work together to solve
problems instead of just finger-pointing, as it meant that they all benefits from
collaborating and completing their respective projects.
2. The open book approach with the vendors to ensure that all expenditures were
being accounted for fairly.
3. Modelling the entire project on CAD softwares. This ensures accuracy, and safety
of the blueprints, allows them to be made quickly than usual and most
importantly, allows the designers to find issues before construction started, thus
avoiding costly rework and delays. Thus, it saves, time, energy and leads to
greater accuracy all highly desirable goals.

Things I would try to change

1. Prioritizing various parts of the airport, and accordingly completing construction
and testing of essential parts over non-essential portions (for both staff and
2. Ensuring thorough work up of IT systems and starting training of the BA staff
on those that are already up and running, even without testing. During training
itself, some flaws/faults could be pointed out, and corrected. Simultaneous
training and testing might be risky, but it can pay off high dividends.
3. Once the initial 6 week building delay happened, the opening should have been
shifted there and then maybe not by 6 months, but say a few weeks. While a
two week notice to passengers and airlines regarding unavailability of services is
unforgiveable, a 6-month notice would be sufficient for nearly all individuals and
most airlines to reschedule

4. What do you think is the key learning from this case study?

The main learnings are:

1. Scale of and complexities arising in megaprojects the interplay between
various sub-projects, and systems. How the timelines and coordination between
various teams has to be aligned.
2. Minimising damage: Factors to be considered while making big decisions (in this
case the opening of the airport)
3. Several lessons were learned from the innovative approach used by BAA to
manage the T5 project and provided unrivalled insight into the impact of
integrated team working on the project outcome. In a break with tradition, BAA
held all the risks associated with the project rather than transferring them to
external suppliers, focused on project capability building and created framework
agreements with preferred partners
4. Learning regarding team working, capability-led approaches and risk