Historical background of the project
The need by Denver international airport management team to upgrade their airport to a state-of-the art airport led to them coming up with an idea of establishing an automated baggage handling system. This was also led by the increase in number of visitors entering or leaving the country through the airport. There was great need for the airport to look for ways to enhance baggage handling within the airport. To realize this, the airport liaised with Boeing Airport Equipment (BAE) to construct the automated baggage handling. The project was expected to take twenty one months. Upon its completion, the system would be capable of handling baggage transfer throughout the airport.
Some of the objectives of the system were to help in delivering individual luggage from the check-in point to the waiting aircraft or unloading luggage from aircrafts and transferring them to the baggage claim sections (Auguston, 1994, p. 40). This would have save the management a lot of time thus enhancing the airports efficiency. For wide body aircrafts, the system was expected to take at most thirty minutes to deliver the baggage while for narrow body aircrafts it could only take twenty minutes. The system was also designed in a way that it could help in transferring the baggage to any place within the airport from the chief terminal in a span of ten minutes.
The management believed that the system would have helped them transfer baggage within the airport at the same rate as the travelers. At its prime, the system would be transferring approximately one thousand bags per minute. Initially, the company manually scanned and shipped baggage from the terminal to intended destinations. This took them a lot of time leading to delays within the airport.
The system was equipped with laser scanners that would be able to scan the barcode of every baggage, identify the flight number and final destination before channel the baggage to a specific conveyor for shipment (Auguston, 1994, pp. 41-44). It would also be possible for the system to monitor the shipment of the baggage till it reaches the destination.
Organizational structure and organizational issue arising from this project
For the system to operate, the company requires to be equipped with 300 computers that would be installed in eight different control rooms. It will have server to help in running the company’s database. To ensure that communication between the different components used in handling the baggage is effective, the company will have to install an efficient fiber-optic network. The company will also have a set of lasers to facilitate in scanning the baggage. Most of the activities conducted manually will be automated resulting in staffs being rechanneled to other activities within the airport. For instance, the system will be able to sort the baggage and direct them to their respective destinations (Auguston, 1994, p. 45). This process will require limited human intervention.
The strengths and weaknesses of the project
With the project completed and operating normally, it could have added a lot of strength to the company as it could be able to automatically scan baggage and transfer them to their intended destinations. With the system being capable of accurately handling a thousand baggages per minute, it could have improved the efficiency within the airport. As the system comprised of distributed computing mechanisms, it would have been possible for the system to handle baggage without having to depend on airport’s information system. This would have boosted its reliability. Based on the rate of carts delivery, the system would be able to adjust its speed thus ensuring that there is no delay in baggage transfer.
However, the system had numerous weaknesses and these led to its failure. Inability to handle baggage in the destination coded vehicles (DCVs) led to some baggage falling resulting to jam. Despite this, the system continued off-loading the baggage from the DCVs. This was a weakness of the photo eye which was expected to signal any mechanical failure for the system to stop operating.
There were instances of numerous DCVs competing for the same designation especially on junctions while at times no DCVs appeared when they were greatly required. Even though the baggage were automatically scanned and transferred to their respective destinations, there were instances of baggage being wrongly loaded and transferred to wrong destinations. There was a problem with harmonization of timing between the mobile DCVs and the conveyor. This resulted in bags falling and being rocked between the conveyors making it hard for loading process to be effectively conducted.
The failure by the system to perform as expected led to opening of the airport being delayed for sixteen months. The system had no backup in place. This meant that failure of the system would have resulted to all activities within the airport being brought into a halt. Some of the problems that led to baggage falling out of DCVs during shipment is the presence of sharp corners that these DCVs were expected to negotiate.
Critical factors of time, cost and specification performance on the project
Initially, the management expected that the entire project would have been through within twenty one months. They had not put in mind the complexity of the project which could have resulted to delay. The numerous changes introduced in the project as it was underway resulted to the airport not being opened at the intended time. In fact, the management postponed the opening date four times. This resulted to the airport being late with sixteen months.
Lack of back up within the airport to cater for the activities in case of system failure led to the airport spending five extra months developing a tug and cart system for baggage handling. After working on the project for some time, the management realized that there was need to make modifications to cater for maintenance of the carts without having to take them out of the rails (Johnson, 1994, pp. 18-23). This meant going back to already completed work and making some changes which led to the initial work being a waste of time and other resources.
Failure by the management to have thorough analysis of the project to identify some of the deadlocks that may be faced during its development led to them estimating the cost of entire project to be approximately $193 million. However, this did not turnout to be the case. There was need by the design team to alter the physical design of the building where the system was to be installed. This meant that the team had to incur an extra $100 million on top of what was expected to cost the project.
Failure to provide a backup for the system led to the airport incurring additional $51 million in building a tug and cart system to facilitate in operations when the system fails. In addition, the airport suffered further $1.1 million per day as interest and other opportunity costs due to delay in its opening time (Johnson, 1994, pp. 25-43). This resulted to the system costing the airport a total of $253 million from the initial estimation of $193 million.
Apart from the cost associated with installation of the system, the delay caused by the system led to owners incurring a debt of $271 million as interest on their bond. The airport also incurred approximately $33 million per month in maintaining the airport. Numerous airlines had invested in secondary facilities as they waited for the airport to open. These include United Airlines and Continental who had invested $261 million and $73 million respectively.
Despite the project being expected to effectively and efficiently handle bags, it was found that bags fell from the DCVs leading to the system jamming. In case of any failure, the photo eye in the system was expected to detect it and alert the system to stop its operation. However, this was not the case as it was realized that the system continued offloading bags from the DCVs despite most of the fallen bags pilling on the conveyor belt.
To enhance baggage handling and shipment, the system was expected to always avail DCVs whenever they are required. Nevertheless, this was not the case. Instances of DCV not being available when required was experienced while at times more DCVs were availed in one intersection leading to them crashing into one another (Myerson, 1994, pp. 4-9). There were cases of bags being wrongly loaded and shipped to the wrong destination. All these problems in the system performance contributed to its failure to meet the expected performance specifications.
What went wrong in the project
The demand by the shareholders for the management team to ensure that it has completed the project within the set time led to it being hard for the team to overcome time constraints. As a result, limited analysis of the feasibility of the project was conducted. The twenty one months allocated to the project did not cater for physical testing of the project as well as simulation of the design to determine its feasibility. This contributed to the development team overlook9ing numerous factors that led to the system failing to operate as it was expected. The idea to include the system in the airport came two years after the airport construction project was underway.
This means that, initial design of the airport had not catered for such systems. The airport had been designed consisting of tunnels with sharp corners and were narrow. This led to the bags falling out of the DCVs when negotiating these corners (Neufville, 1994, pp. 229-232). To ensure that the system operated successfully, it required the team responsible of installing the system to modify the design of the buildings within the airport.
Effects of the project failure
The project failure was found to be costly to the company. This is with respect to time and money. The company delayed its opening for sixteen months to ensure that the system was fully completed. This led to the company incurring extra costs in terms of opportunity costs. The $193 invested in the project became a waste of money which could have been invested in other contractive projects within the airport. In addition, the failure led to the company having to face extra $51 million to install tug and carts system to handle baggage. Apart from financial implications incurred by the company, it also suffered bad reputation in the public and other airlines that wished to use the airport (US Government Accounting office, 1994, pp. 23-32). This is especially those that had heavily invested in the airport in preparedness for the system to start operating.
How the following contributed to project failure
Project management team
The management team responsible of foreseeing the installation of the system contributed to the failure of the project. The team overlooked the complexity behind the project. This led to the management team taking time before announcing their bid to install the system. Their announcement was only made at a later stage. The management team failed to put into consideration effort required in installing the system.
This led to it team heavily focusing on the system and considering it as the airport’s vital path. The time allocated for the project by the team was not enough. As a result, the team had to look for short cuts to ensure that the project was completed within the set time. It is believed that the subsequent problems experienced during the process of project realization emanated from the mistakes made by the management team as it tried to meet the deadline.
Prior to the start of the project, the management team had decided that every airline would cater for its baggage handling issues. This led to some of the airlines investing in the project. Later, the team changed its mind and decided that the airport was to finance and run the project by itself (Neufville, 1994, pp. 234-236). This came later leading the project facing time constraints.
The success of any project depends on how the project managers monitor, allocate budget and schedule activities for the project. This was not the case for Denver baggage handling system. Project managers from both Denver and BAE agreed to enter to the project under a fixed time period as well as fixed budget. This meant that that BAE staffs had to do all it takes to ensure that they have completed the project on time.
Allocation of fixed financial resources led to the company looking for other means to ensure that it has completed the project without incurring extra cost. All these factors contributed to the failure of the project as every party looked for shortcuts to help it complete the project without incurring costs. The project manager also rocked out airlines from the control and supervision of the project despite them being stakeholders in the project (New York Times, 1996, p. 17). This added to the failure of the project.
Despite the management hoping that the technology used in developing the system would have helped in achieving their objectives, the technology was found to contribute to the failure of the system. It was difficult for the system to detect cases of failure such as jam. It continued operating leading to the problem becoming even worse. Algorithm used in synchronizing processes such as allocation of empty carts proved to be a nightmare.
Cases of carts not being availed at the right locations were reported while at other instances carts were found to crash into one another especially in the intersections. The manner in which the personal computers working in the system were distributed in the building made it difficult to correct problems when they arose. The technology used also failed to provide a backup for the elements used in the system (Gibbs, 1994, pp. 86-95). This meant that failure of one component in the system would lead to the entire system being rendered malfunction.
Personnel and finance
As the baggage handling system was a new idea in airport industry, Denver as well as BEA lacked the necessary personnel and expertise to handle the process. The management team entered into the project with limited knowledge on how to go on with the project. Lack of qualified personnel for the project also contributed to the company assuming that the allocated time would be enough to complete the project.
This is because they were not aware of the complexities involved in the project. On the other hand, Finance allocated to the project was limited. BEA was expected to complete the entire project without asking for further funding. This led to it looking for alternatives to help it meet all project requirements with the available fund. Had the team been allocated enough funds, it would have been possible for them to make all the required alterations as they continued with the project to ensure that it meets all the required specifications (Wellington, 2007, p. 56). Limited financial resources led to the team installing the system looking for alternatives which eventually led to the system failing to meet its operation specifications.
After the public realized that the project was destined to fail, they pressurized the Mayor to intercede and try to save the situation. This led to the Mayor requesting for an expert in baggage handling system to come and assess the situation. Mattias Franz from Logplan; a German company came and after assessing the situation gave ideas on what to be followed in completing the project. However, the mayor played down his recommendations and ordered the airport to come up with a mechanically operated baggage handling system. This led to the management not heeding to the advice given by Mattias as they embarked on developing a manually operated baggage handling system (Wellington, 2007, p. 64). Eventually the project turned out to be a total fiasco.
Prove of the project methodologies
The entire project was conducted without the management considering the project methodologies to be followed. Had they consulted the project methodologies, they could have understood the complexity of the project thus looking for ways of overcoming them as well as allocating the project enough time. Lack of the management to recognize the project methodologies led to them planning poorly for the project (Wellington, 2007, p. 92). The management did not take the initiative of conducting a simulation of the system to determine its feasibility before embarking on the project.
Alternative options for the project
Due to the complexity of the project, there is need for the management team to focus on reducing its complexity. This can be through cutting down on its functionalities. This can be achieved by narrowing down the number of channels served by the system to one. The system also needs to deal with one kind of baggage such as those entering the airport or those leaving the airport only. This is to ensure that it effectively sort the bags (Wellington, 2007, pp. 112-123). The workload of the system ought to be cut down by approximately half of what it was intended to handle. Through this, the project will be more reliable.
The failure of the entire project resulted due to poor planning from the project managers. The failure by the managers to ensure that there is proper communication within the company led to those with ideas regarding the company failing to contribute. Had I been the company’s manager, I could have ensured that every idea fro the stakeholders was incorporated in planning for the project. This would help in identifying the complexities behind the project and planning for them in advance. I could have also used computer simulations to determine the feasibility of the project. This would have helped in saving the company from investing on a project that would not be successful.
Auguston, K. (1994). The Denver Airport: A lesson in coping with complexity. Modern Material Handling, pp. 40-45.
Gibbs, W. W. (1994). Software chronic crisis. Scientific American, pp. 86-95.
Johnson, D. (1994). Late already, Denver faces more delays. New York Times, pp. 18-43.
Myerson, A. (1994). Automation off course in Denver. New York Times, pp. 4-9.
Neufville, R. (1994). The baggage system at Denver: prospects and lessons. Journal of Air Transport Management, 1(4), pp. 229-236.
New York Times. (1996). Denver Airport nestles into its lair. New York Times, p. 17.
US Government Accounting office. (1994). New Denver Airport: Impacts of the delayed baggage system, briefing report to the Hon. Hank Brown, US Senate. RCED-95-35BR, pp. 23-32.
Wellington, W. (2007). The man, the Mayor and the making of modern Denver. New York: Fulcrum Publishing.