This report aims to conduct an overall analysis on the colossal failure that was and continues to be the Berlin Brandenburg Airport. We will be looking at the following project management knowledge areas: Communication, Cost, Time, Quality and Scope. The reason we chose this topic to discuss is because it sparked an interest among our group following the massive failure of the project. It is important for us to acknowledge the failure of the project through the project managers perspective. From researching this project failure in detail we found some interesting points that we would like to make some recommendations on.
Useful information was obtained through the use of journal articles and academic books from the library. Within the research we conducted we found many reasons why the failure of this project was so catastrophic including lack of expertise among the team, poor planning and mainly lack of communication between various members of the project management team.
Project Communication management refers to the processes needed to ensure ‘timely and appropriate generation, collection, dissemination, storage, and ultimate disposition of project information’ (PMOK Guide, 2013). Communication in project management is crucial (Zulch, 2014), and various literature argues that it can ultimately determine the difference between a successful and unsuccessful project (Ramsing, 2009). Baker (2007, quoted in Ramsing, 2009, p.345) highlights that ’95 per-cent’ of project issues are as a result of miscommunication. Thus effective communication in project management should be of high importance to project managers.
While several elements left to the demise of this project, insufficient communication was undoubtedly one of them. There is evidence to suggest that Klaus Wowereit, project leader and city mayor, lack of leadership and poor communication during construction had a trickling effect on the overall outcome of the project. Not only did Wowereit fail to communicate real-time information with the rest of the stakeholders, he also denied knowing about some of the major issues that occurred during the construction, even as the situation became worse (Nieto-Rodriguez, 2018).
Project leaders succeed by delivering projects on time and within budget as well as effectively managing the interaction and communication between all stakeholders (Zulch, 2014). However, an interview with one of the stakeholders Andreas, a German aviation specialist, says that there was no formal line of communication implemented so this created an environment where no one really knew what the real situation was any more (CNN, 2017). As a result, this asymmetry of communications between all stakeholders led to both internal and public communication confusion, particularly regarding an opening date (OECD, 2016).
The board of directors evaluated this lack of acknowledgement as total negligence on Wowereit’s part (Reuters, 2018). And, in 2013, after facing massive criticism, he resigned from his position as project CEO (Reuters, 2018). While several project leaders have been assigned to the project since, not one of them have been able to lead the project to completion successfully.
Therefore, without effective communication, managers are not effective leaders (Zulch,2014). From the very beginning of a project, it is the responsibility of a project manager to implement a communication plan and agree upon a line of communication, to ensure that all communication-related issues are handled correctly (Zulch, 2014). Without an active communication management strategy, it is likely that any problems or obstacles that arise during a project will go unnoticed, leading to further complications and in worse cases, project failure, which was the case for the Berlin Brandenburg Airport.
Given the large number of stakeholders involved in this project, which included the state of Brandenburg, the German federal government, the city mayor, the airlines, the passengers and the workers (Nieto-Rodriguez, 2018), an active communication plan is essential. The more people there are involved in a project, the more difficult it becomes as each stakeholder groups will have different objectives (Ramsing,2009). If project managers want to communicate with each stakeholder group on a specific level, then they need to implement a different communication strategy for each (Zulch, 2014) But, Klaus Wowereit’s failure to do so not only had a negative impact on the stakeholders but also on the rest of the project.
“Project Success: The project is completed on-time and on-budget, delivering the expected value; Project Failure: The project is either terminated or not completed on-time, or not on budget, or not providing the value aimed for.” (Holgeid and Thompson, 2013)
The project budget is one of the most important documents in the project. Cost estimating is one of the most sensitive topics in project management. However, getting reliable estimates early in the project is often not possible. This often leads to putting out estimates that are not accurate (less than what is really needed), and project managers then being held accountable for not meeting the estimate (PMBOK, 2015). There is substantial evidence suggesting that poor estimates are a major contributor to projects that have failed (Larson and Gray, 2017). This is obvious in the case of the Berlin Brandenburg Airport.
The total cost of the project is now close to €7.9 billion which is almost 50% above the proposed budget of €5.4 billion (Nieto-Rodriguez, 2017). Over seven years on from its original proposed opening date and still no sign of an official open date in the close future, this project can only be deemed a failure in every aspect of project management.
Christian Görke (Finance minister of Brandenburg) admits that throughout the project the cost situation at BER lacked clarity. Görke who is also on the airport supervisory board said in an interview with MAZ magazine that the supervisory board, with its representatives of the three shareholding Governments, nor the parliaments that had been provided with a financial plan for the completion of the Airport Project. Why the supervisory board did not demand a finance plan is something that is very much bewildering.
Fiedler and Wendler feel that it is surprising that such a large and high profile project was not installed in a project governance framework which would have ensured expertise on all levels and a degree of assurance comparable with the public money spent. If the proper framework was introduced, it may have led to the correct appointment of a chief engineer planner for the airports fire protection system instead of an engineer draftsman whos mistakes cost hundreds of millions of dollars to fix (James, 2018).
To have control over the budget, the project manager must be strict with his product supervision, this was ignored at Brandenburg Airport as up to 90,000 metres of wires were installed incorrectly throughout the building increasing costs even further. The manager must be aware of where all funds are going at all times and allow for sudden changes that may need to be made unexpectedly (Clarizen, 2017).
A project manager must put together a cost estimation plan to establish the framework which will be used to distribute project costs, this can often be referred to as a Work Breakdown Structure (WBS) (Cullen, 2016). The WBS helps the project manager by defining each factor of the project in a hierarchical format and constructs their relationships to the project end item. Each item in the framework requires a cost and time estimate, having this information the project manager is able to plan, schedule and budget the project. The WBS can also be used as a framework for tracking both cost and work performance (Larson & Gray, 2017). If an accurate and sustainable WBS was implemented for the Brandenburg Airport it could have helped save the billions of dollars that were lost and resulted in the airport not opening.
As we know, time had a lot to do with the ultimate downfall of the Berlin Brandenburg Airport. The pre planning stage of the project took around 15 years before the airport was even functional. The construction of the airport was due to take around 5 years which began in 2006. This means that the estimated time for the official opening of the airport would be 2011. The official opening date was set for October 30th 2011, and now 7 years on the airport is yet to open officially, despite €7.9 billion being spent on it.
Economic growth has increased the demand for airports which in turn causes the delays that we see everytime we visit any airport. The demand from the population of Berlin for air travelling grew significantly from 11 million to 18.5 million from 2006 until 2011. At one stage Berlin had 3 fully functioning airports, all with different strategies. The federal state of Berlin then decided that the three airports should come together and create one airport to serve the whole of Berlin, seeing each of the teams from the three individual airports combining their strategies. To speed up travel times there would be a direct highway from the airport straight into the city, while there were also plans for a train route to be built under the terminals.
However, none of this actually came to fruition for the billions of people ready and waiting to experience not only the greatest airport in Germany but an airport that was due to compete with some of the best airports in Europe. 7 years on from the official opening date and the airport still remains closed. The delayed opening was first put down to ‘technical issues’, however this has now been put down to the fire protection system being faulty.
As we can see, time has had a significant impact on the costings of the Berlin Brandenburg Airport which was discussed earlier in the report. Because this new state of the airport was due to open Tegel airport was due to close its doors, however, this remains Berlin’s main hub even after all these years. The management of the project may have had a lot to do with the failure of this project, however this may be a contributing factor as to why the failure has been ongoing for some time. The coping mechanisms of individuals can have a lot to do with why they didn’t get the project up and running after the first technical failure. Negative emotions can come along with failure which may have something to do with why the airport has not yet officially opened its doors (Shepherd, D., Patzelt, H. and Wolfe, M. 2011). It seems a date has been set in 2021 for the official opening of the airport, but as we know this could be as far off the mark as 2011 was.
To define the scope of a business is to define it in extremely broad terms. ‘Scope’ itself covers a number of activities which are more commonly divided into two outlooks: Industry and Commerce (Sutherland & Canwell, 2004).
The first perspective, ‘industry’ encapsulates activities like extraction, conversion, processing and / or fabrication of products within the industry. According to Aremu (2015), these activities can be split into three forms of goods, Consumer Goods, Capital Goods and Intermediate Goods. The second perspective ‘Commerce’, refers to the interchange of goods or commodities on a large scale between possibly several different countries. These are commonly split into Trade and Service businesses. While Industry and Commerce are the obvious perspectives when discussing scope, there are several other viewpoints on this topic and in general, the most important areas accepted within business include (Khanchi, 2014):
1. Demand Analysis and Forecasting
2. Cost and Production Analysis
3. Pricing Decisions, policies and practices
4. Profit Management
5. Capital Management
6. E – commerce