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EAC MBA Project Management - Railway GDS Distribution - Westbahn

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This is an academic, not a practical, approach to a high-speed rail distribution in GDS. It shows how I would solve the issues and which scholar methods I would use. And for sure, it has been implemented practically and works currently.

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EAC MBA Project Management - Railway GDS Distribution - Westbahn

  1. 1. Railway GDS Distribution Project Management Coursework Simon Riha Cohort 13, Aviation Management Emirates Aviation College May 14, 2012
  2. 2. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 2 Table of Contents INTRODUCTION 3 BUSINESS CASE ASSESSMENT 4 PROJECT PLANNING AND SCHEDULING 8 WORK BREAKDOWN STRUCTURE (WBS) 9 PROJECT ORGANIZATION STRUCTURE 11 NETWORK DIAGRAM AND GANTT CHART 12 PROJECT MONITORING AND CONTROL 15 PROJECT RISK AND REDUCING UNCERTAINTY 20 CONCLUSION 24 REFERENCE LIST 25 APPENDIX 1: A BOSCARD TABLE EXAMPLE 26
  3. 3. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 3 Introduction This coursework examines development of a strategic project plan for implementing train connections in the airline Global Distribution Systems (GDS). Railways in GDS have been a topical topic for past fifteen years, as long as the industry has been internationalized through liberalization and demand for interlining between airlines and railways (so-called “rail & fly”). Though some GDS distribution solutions for railways have been released, they have remained marginal and have not become any industry standard. In particular, Westbahn, the first private railway in Austria, has approached Hahn Air, a German airline specialized in global distribution, to make their trains saleable in GDS in manner as if their trains were flights. This work examines the project development process from initial business case assessment and proceeds through project planning and scheduling, project monitoring and control to managing risk and reducing uncertainty. When doing so, the work concentrates on studying procedures helping Hahn Air create such a project in the existing environment of small and medium enterprises without any corporate project management structures, such as project management office, project steering committee, and so forth. Based on research of available project management sources, this coursework suggests a few efficient methods and techniques appropriate for this kind of project and environment in order to facilitate and speed up the project plan development.
  4. 4. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 4 Business Case Assessment When thinking of the commercial idea to publish Westbahn rail connections in airline distribution systems, the first question to be answered is how to kick off such a business project. Nicholas & Steyn (2012, pp. 83-162) describes a method for project initiation and definition as a part of their thorough Project Management Lifecycle methodology. In the project conception and definition phase, Nicholas & Steyn recognize Project Initiation (for example, in the form of a vision statement as in Microsoft Corp.) followed by Initial Investigation comprising of clarification of a problem, evaluating possible solutions, interviewing managers and users, collecting initial data, reviewing existing documentation, and so forth. At this point, they refer to Project Portfolio Management to decide whether the project qualifies or not. Next, they proceed to Project Feasibility to conduct a feasibility study, that is, to identify alternative solutions, to further analyze the points of issue and also to evaluate a possible environmental impact. They continue to the functional and non-functional requirement analysis, for instance, by using methods such as Requirements Breakdown Structure and House of Quality. The outputs of their project conception and definition phase are detailed documents called Statement of Work, Scope Statement and Project Master Plan. Nicholas & Steyn (2012, p. 558) note: “To accommodate projects of different size and complexity, the methodology can be ‘scalable’.” Considering the size of the Westbahn project, size of the both companies, duration, importance and complexity of the project, the project initiation and definition stage can be scaled down.
  5. 5. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 5 One of simplified approaches for project initiation and definition is called BOSCARD. It originated with Cap Gemini consulting company in the 1980s. The acronym stands for background, objectives, scope, constraints, assumptions, risks and deliverables, which altogether constitute a usual baseline for project initiation documents. BOSCARD is practical for providing a complete bottom line for quick and brief project outlines when still delivering all important project information to stakeholders, without having to undergo the entire exhaustive project initiation procedure resulting in a full project initiation document. (Haughey, n.d.) An example of the use of the BOSCARD is attached in Appendix 1. It illustrates its well-arranged structure and brevity while still providing the wide high-level characteristic of the Westbahn project. Such a BOSCARD can be created, for instance, by discussing and brainstorming particular BOSCARD sections in a small group of key managers and engineers at short time. Findings and results of such a brainstorming sessions are documented in the BOSCARD table. Focusing on one particular BOSCARD section, that is, in particular, the scope definition of the Westbahn project, a decision has to be made, which features and functions to deliver in the project scope and which to leave outside of its scope. Grundy & Brown (2002) suggest a few useful diagnostic methods providing a solid framework for strategic analysis and decision-making: Performance Driver Analysis, Gap Analysis and Fishbone Analysis. Grundy & Brown postulates that Performance Driver Analysis is useful for turnaround projects, diagnosing organizational issues and difficulties, and defining problems to improve business performance. Ansoff (1965) characterizes Gap Analysis as a classic, strategic planning technique particularly useful for linking strategy development, business breakthroughs, business plans and shareholder value creation. Fishbone Analysis (Grundy & Brown, 2002) provides a method for going beyond an immediate definition of a problem or opportunity. Chapman (n.d.) states that fishbone diagrams are useful for early
  6. 6. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 6 planning such as organizing factors and identifying hidden factors during brainstorming. Based on Chapman, Fishbone Analysis is a fitting technique how to decide on the project scope. For, the business case assessment of the Westbahn project is an early project planning stage. The scope analysis requires revealing, identifying and organizing features and functions, which shall be considered in or out of the project scope. Using the fishbone diagram technique, a brainstorming group can start defining the functional scope by first setting the ultimate functional goal. It may be, for instance, “passenger resting aboard peacefully” in this particular case. Beginning from this very end, going backwards, the fishbone diagram can easily portray all preceding features and functions to consider in the project. Other features and functions, found less important or redundant, may be excluded from the scope or, for instance, postponed for later versions.
  7. 7. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 7 Figure 1: Fishbone Diagram1 As previously described, the outputs of the project conception and definition phase are documents called Statement of Work, Scope Statement and Project Master Plan in the methodology by Nicholas & Steyn. In the Westbahn project, BOSCARD obviously covers Statement of Work and Scope Statement. A pending part, Project Master Plan, is worked out in the next stage of the project – project planning. 1 A generic fishbone diagram template in MS Excel format was downloaded from <http://www.brighthub.com/office/project-management/articles/6179.aspx>
  8. 8. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 8 Project Planning and Scheduling Nicholas & Steyn (2012, p. 163) state that every project is unique in some way. Every project thus poses new questions regarding what, how, by whom, in what order, for how much and by when. They define five questions, which the planning process has to answer before the work itself can commence: 1. “What?” addresses project objectives, scope and system requirements (project deliverables, end-items, and other sought results, time, cost and performance targets). 2. “How?” answers the question on definition of all work activities, tasks and jobs to achieve objectives and requirements (to deliver end-items and deliverables, including planning, control and administration activities). 3. “Who?” specifies project organization – individuals, departments, managers, who will perform and manage the work including defining clear responsibilities. 4. “When, in what order?” is addressed by the schedule showing timings, deadlines and milestones. 5. “How much and when?” is to create a budget and resource plan to fund and support the project. 6. “How well?” is to specify a method for tracking and controlling project work. The first question “what” has been previously answered by means of the BOSCARD and Fishbone Analysis. Next three questions, i.e. “how”, “who” and “when/in what order” are going to be answered in this section of this work. The fifth question “how much/when”, is out of scope of this paper. The last question “how well” is addressed in the next section of this coursework devoted to project monitoring and control.
  9. 9. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 9 Back to the questions “how” and “who”, a prevalent method for answering them in project management is so-called Work Breakdown Structure. Work Breakdown Structure (WBS) Nicholas & Steyn (2012, pp. 169-177) recognize Work Breakdown Structure (WBS) as the optimal method for exactly specifying all tasks and jobs the project team must do. WBS answers the second question “how” and the third question “who”. WBS process starts with defining the main end-item or deliverable of the project on the top, which is understood as a certain system. This system can be further subdivided into subsystems and further smaller components. Thus, the project outcome or deliverable can be divided into final parts – so called “work packages”, which simplify scheduling, budgeting and assigning responsibilities. Nicholas and Steyn recommend that work packages shall be well define in terms of clearness, comprehensiveness, resource requirements, time, costs, responsibility, outcomes, inputs, quality and risk. Only if the most of these properties are satisfactorily worked out for each WBS box, such a box can be considered as well defined and becomes a work package. WBS may also be used to answer “who”, since each work package can be exactly assigned someone’s responsibility. WBS can be integrated into the project organization to clearly assign which team or department is in charge of each particular work package. This can be documented by so called Responsibility Matrix attached to WBS. WBS can be constructed either from product or functional perspective, depending what the end-item or deliverable of the project is. Nicholas and Steyn further advise to constantly ask questions “What else is needed?” and “What’s next?” when creating WBS.
  10. 10. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 10 Nicholas and Steyn (2012, p. 173) also recommend that WBS may include work packages related to project management itself, such as schedules, plans, budget, risks and so forth. Applying WBS in the Westbahn project, it is created by repeatedly answering the question what all is needed for the principal deliverable, that is, to make Westbahn saleable in the airline GDS. Since distribution is rather a process and function than any product or end-item, this particular WBS approaches the deliverables primarily from the functional perspective. As recommended by Nicholas & Steyn, Westbahn WBS includes work packages related to pending project management issues. Finally, each work package is assigned to a particular worker, team or department to define and assign responsibilities. Figure 2: Work Breakdown Structure The advantage of WBS method is that it provides a complete structured high- level overview of all the elements, tasks and jobs to deliver the end-item or deliverables expected from the project. Another advantage is a possibility to
  11. 11. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 11 clearly assign each box to a department, a team or an individual person to accurately assign responsibilities. The downside of WBS is that it does not show any workflow, that is, which work package is to be executed at what time and which work package has to be accomplished before another can be processed. WBS does not provide any information on times and scheduling either. After discussing project organization to better answer the question “who”, WBS is to be enhanced by other planning and scheduling methods to further work out the project plan for the Westbahn GDS distribution. Project Organization Structure Nicholas & Steyn (2012) name two project organization structures: Pure Project Organizations (PPO) and Matrix Organizations. PPO is a separate entity created especially for the project. A project manager heads the PPO with full authority over people and resources required for the project. On the contrary, a project conducted in Matrix Organization structure draws human resources and technical expertise from the existing functional division of the company. Project workers remain in their functional departments. They are assigned to certain projects on a temporary basis. Matrix organization is selected, for the Westbahn project is relatively small. Its duration is estimated only 2-3 months. Last but not least, Hahn Air is per se a functionally organized company. Matrix organization’s main advantage for the Westbahn project is that the project manager can involve suitable project members from the existing functional organization without taking them out of their original departments.
  12. 12. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 12 Workers can thus continue working on other tasks related to their functional departments or other projects. Project manager has to just cope with one principal disadvantage, that is, each worker has more than one manager. Nicholas & Steyn (2012, pp. 476-477) point out that this situation tends to lead to confusion and conflicts. They stipulate that every company establishes clear priorities in this respect. As a rule of thumb, Peters & Waterman (n.d., pp. 307-308) mention an example of Boeing, a long- term successful user of matrix organization, setting workers’ priorities day-to- day: workers operate either in a project team or in a functional area. They have to put their priority on whichever area they are in. Boeing’s rule of thumb is concluded to be appropriate for the Westbahn project organization at Hahn Air. Workers assigned for the project work primarily on the project, secondarily in their departments until the project is accomplished. After discussing the question “who” in more depth, the next question “when, in what order” can be addressed. Network Diagram and Gantt Chart Project Management offers two standard tools for planning and scheduling projects beyond WBS: Network Diagram and Gantt chart. These techniques help answer the fourth question, that is “when, in what order”. Network Diagram is a flow chart depicting the sequence of tasks and activities in which they are to be completed and their mutual sequential relationships. The chart shows events and milestones, as well as preceding and succeeding activities related to a certain activity. Activities can be identified that may run in parallel with others to save time. Network diagrams can also be detailed by calculating activities’ duration, early times and late times. This is a part of so- called Critical Path Analysis helping determine which activities, their durations
  13. 13. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 13 and relationships are critical to keep the project schedule and meet the planned deadline, whereas other tasks and jobs may be executed at a certain slack. (Nicholas & Steyn, 2012, pp. 198-210) Gantt chart is a bar chart drawn to scale with the horizontal axis directly proportional to time. Particular project tasks are listed one after another. Their start dates, durations and end dates are shown using bars, whose start date, duration and end date correspond to the horizontal scale. Gantt chart is a popular aid favored by senior managers for its visual graphical overview of project task and schedule. (Flouris & Lock, 2008) Nicholas & Steyn (2012, p. 197) stress out that project scheduling involves more than just displaying tasks on Gantt charts. They argue that though Gantt chart is an excellent tool for communicating project schedules, it is rather limited as a planning tool. Gantt chart does not explicitly show relationships between activities. It does not show how activity delays and resource shifts may impact the overall project. Hence, Nicholas & Steyn (2012, p. 211) recommend: “Gantt chart should be created only after a network analysis has been done, early and late dates determined, and issues and constraints surrounding the project accounted for.” Based on Nicholas & Steyn, a network diagram is to be prepared in the Westbahn project before Gantt chart. Individual work packages from WBS are to be analyzed on their estimated duration and sequential relationships with other work packages. Furthermore, early and late starts and finishes of every work package are to be calculated, slacks identified and critical path defined. Next, Gantt chart is generated listing work packages (some may be further broken down in more tasks and activities) and showing their starts, finishes and durations with horizontal bars on the calendar line. Precedence relationships defined in the network diagram are added onto the chart to display the related dependencies. Each task is assigned its responsible worker from WBS and other required resources.
  14. 14. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 14 Figure 3: Gantt chart example At this stage, the Westbahn project is ready for implementation. The Statement of Work and Scope Statement in the form of BOSCARD discussed in the previous chapter has been enhanced by a Master Project Plan created using Work Breakdown Structure, Network Diagram and Gantt Chart in this chapter. Project implementation is related to project monitoring and control, which is addressed in the next section.
  15. 15. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 15 Project Monitoring and Control After the project is successfully initiated and planned, the actual project execution can commence. At this stage, Nicholas & Steyn (2012, p. 395) limits a major function of project management to control the project. Roman (1980, p. 369) defines the project control process as: “Assessing actual against planned technical accomplishments, reviewing and verifying the validity of technical objectives, confirming the continued need for the project, timing it to coincide with operational requirements, overseeing resource expenditures, and comparing the anticipated value with the costs incurred.” Nicholas & Steyn (2012, pp. 389, 396-397) assure that no project plan is ever complete or perfect despite all efforts invested in planning, scheduling and budgeting. Reality always differs from plans. Therefore every project needs project control to move forward, track progress, tackle problems and oversee costs and deadlines. Besides project control, they define project monitoring, an accompanying activity, as observing and tracking how well the project is performing and forecasting how it will eventually perform. Project monitoring involves collecting data, interpreting it and reporting information. Nicholas & Steyn (2012, pp. 402-406) give a hint, which project areas to control: o Scope – to avoid or at least to minimize so-called “scope creep”. Project scopes tend to grow due to changes and additions as the project goes. o Quality – to make sure that desired requirements and specifications are met and to reduce errors in the work process. o Schedule – to keep project on schedule as planned. o Procurement – to control external suppliers’ progress. o Cost – to track difference between budgeted and actual cost accrued.
  16. 16. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 16 Roman and Nicholas & Steyn provide sound basic theoretical introduction into project control and monitoring by clearly defining what these categories are, which purpose they have and which areas they shall cover. This is insufficient for the Westbahn project yet, for they have not provided any practical guidance on how to deploy and carry on monitoring and control in projects. Singh (n.d., p. 16) describes a simple practical tactic for project monitoring and control by using the project plan and by organizing regular review meetings. The project plan can be updated, as well as other documents such as requirements and functional specifications, in the review meetings, for which he gives the following tips: o Have an informal discussion with your key team members before the meeting. o Do a detailed project review on your own – carefully review all the tasks that need to be completed in the next three to six weeks. By doing so you may identify issues that need to be discussed during the meeting. o Now circulate a meeting agenda to all participants. o If decisions need to be made at the meeting, make sure that the person with the authority to make the decisions attends the meeting. o Start a meeting by specifying its objectives. o Quickly compare the project’s current status with the original project plan. o Follow the initially established agenda and avoid straying from it. o Ensure that the meetings are not too long and make efficient use of the participants’ time. o Always end by recapitulating the decisions made, and the next steps. o Write a meeting report and circulate it within 24 hours of the meeting. Depending on the situation, you might want to write a detailed report or just a simple list of decisions that were made, and actions to be taken.
  17. 17. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 17 Referring to the Westbahn project organization, nature and size of both Hahn Air and Westbahn companies, this tactic meets this project’s monitoring and control requirements. Having an environment of no excessive corporate project management organization (no project management office, no dedicated project controllers, only moderate reporting needs, rather relaxed management attitude, preference of quick and efficient informal meeting, and so forth), project manager (PM) exercises project monitoring and control following Singh’s method. PM periodically checks project documents such as BOSCARD, WBS, Network Diagram and Gantt Chart. PM assesses the actual progress against the plan. PM consults key project members on this informally to crosscheck and to get true information. PM organizes periodical quick status meetings with a clear focused agenda. Thus, the entire team can keep an overview over progress of the entire project, not just on the particular part the team member is working on. Thanks to the specified meeting objectives and agenda, the meeting is straightforward and efficient. Variances between the planned and the actual status are addressed and discussed. Decisions on corrective actions can be made on spot, since relevant decision makers are invited to the project review meeting. A short meeting report addressing only relevant decisions and actions is produced instantly and circulated within 24 hours to relevant stakeholders. When performing control function, PM is to watch on scope, quality, schedule, procurement and cost as advised by Nicholas & Steyn. PM pays attention at the scope of the Westbahn project as defined in the BOSCARD to avoid any distractions misleading from the core objectives. In terms of quality, PM checks on relevance of the project and its objectives for Westbahn as long as the work progresses, as well as on relevance of the requirements and specifications originally defined for Westbahn at the beginning of the project. PM observes the schedule for any time discrepancies and delays. Procurement is
  18. 18. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 18 irrelevant in the Westbahn project, since there are no external suppliers in this project. The last category PM is advised to oversee is costs. Singh does not offer any hints in this respect. Nicholas & Steyn define the cost control as tracking difference between budgeted and actual cost incurred. They point out that the traditional notion of cost control is not appropriate for project management. Traditional cost control simply measures the amount spent with the amount planned in the budget. Comparing the difference clearly shows, whether the project runs within the budget or it does not. However, this simple comparison does not deem any work progress achieved. Thus, the project may be well within the budgeted cost, but this can be caused by less work performed than planned. Nicholas & Steyn and several other project management experts (Haughey, Dwivedi and Woods, among others) agree that Earned Value Management (EVM) is an appropriate method for these purposes. EVM is a systematic project management process used to identify variances in projects based on the comparison of work performed and work planned. (Dwivedi, n.d.) EVM works with three principal variables and three variances (Nicholas & Steyn, 2012, pp. 407, 409): o Planned Value (PV), Actual Cost (AC) and Earned Value (EV) o Schedule Variance (SV), Time Variance (TV) and Cost Variance (CV) PM finds out the current status of the project by comparing and interpreting their values. For example, if EV is less than PV, the project is behind schedule. If AC is higher than PV, the actual cost incurred so far is higher than the budgeted cost. TV shows in days or weeks how late the project is behind the original schedule.
  19. 19. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 19 PM’s job at project control is to have completed projects within assigned time scale and budget. PM must not control only cost and budget without controlling work and performance achieved. EVM reputation as a project control function has increased over years now being a popular tool among project managers for successful project delivery. EVM integrates both schedule and cost control into measuring project performance. (Woods, 2012) Woods names several advantages to introduce EVM in project management process, such as better visibility how the project is doing, better control over project’s performance, possibility to easily determine the future status of the project, decrease in project risk, prevention of scope creep, and so forth. Woods names some disadvantages, too. EVM may lead to overly paying attention to time and cost savings rather than the quality of the project. Woods thinks that the biggest issue is regular maintenance of the information necessary for producing the calculations. Time and effort must be invested into maintaining both planned and actual time and cost in the project planning software. Wilkens (1999) lists five simple steps how to set up EVM: 1. Divide the project into manageable portions using WBS. 2. Develop activities to be scheduled. 3. Allocate resources and related costs for each activity. 4. Schedule activities over time. 5. Reconfirm the plan is acceptable by analyzing data. Wilkens advises the following 4 steps for using EVM: 1. Update the schedule by reporting activity progress. 2. Enter actual costs on activities. 3. Execute EVM calculations, produce reports and charts. 4. Analyze the data and write narrative report.
  20. 20. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 20 Wilkens states one more useful tip: “For labor-intensive efforts, work hours are often considered adequate.” In other words, if the project predominantly comprises of work, EVM may be excessive. The Westbahn project is labor-intensive. Looking at the resources planned in WBS and Gantt chart, there are no materials, supplies or other inputs than work. Thus, though EVM is a usual method for project control, it is concluded unnecessary for this project. Instead, following Wilkens, controlling working hours provides sufficient control over project costs in this particular case. This will save project management capacity otherwise devoted to maintaining EVM in terms of Wilkens’s steps 2-4. Concluding project monitoring and control, the project management techniques depicted above reduce diversions from the project plan and impose necessary corrective actions. However, remembering that reality always differs from plans, certain risk and uncertainty still remain in the project. Therefore, next section discusses how to cope with them.
  21. 21. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 21 Project Risk and Reducing Uncertainty Grundy & Brown (2002) argue that inexperienced project managers usually underestimate project definition, careful planning and control. Managers spend less time analyzing and preparing, which results in longer and more problematic implementation caused by surprises, unexpected events, troubles, looking for their solutions and resolving them. Grundy & Brown suggest the ideal time versus actual time as follows: Actual Time Ideal Time Definition and diagnosis 2% 20% Strategy and planning 10% 20% Implementation 80% 40% Control and learning 8% 20% Wrona (Your Risk Management Process: A Practical and Effective Approach, n.d.) elaborates further: “Some experts have said that a strong risk management process can decrease problems on a project by as much as 80 or 90 percent. In combination with solid project management practices, … , a good risk management process is critical in cutting down on surprises, or unexpected project risks. Such a process can also help with problem resolution when changes occur, because now those changes are anticipated and actions have already been reviews and approved, avoiding knee jerk reactions.” This is a clear argument for incorporating risk management along with all previously described methods and techniques into the Westbahn project plan. In her practical and effective approach, Wrona defines project risks as unknown events embodying threats. She encourages companies to identify more than just some 5-10 project risks that are usually identified on fairly typical multi-month projects. The more project risks are identified as early as possible, the more
  22. 22. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 22 potential problems are recognized earlier and the more opportunities are seen more readily. Wrona recommends that the following 7 steps be embedded into each project noting that modifications are possible: 1. Every person involved in the project pencils at least 10 potential risk items. 2. All inputs are collected and piled up onto one single list removing duplicates. 3. Assessment of probability, impact and detectability of each risk item, for example, using a scale from 1 to 4 or a subjective term as high, medium, or low. 4. Project team divided into sub-groups. Each sub-group gets a portion of the master list. Each sub-group identifies and notes triggers (warning signs). 5. Same sub-groups continue on identifying possible preventive actions for the threats and enhancement actions for the opportunities. 6. Creating a contingency plan with actions to take if a trigger or a risk to occur. It is sufficient to cover only the risks scoring above a certain threshold determined by the total risk scores. 7. Determination of the owner for each risk on the list. Wrona advises not to start this risk management process from scratch every time. It is rather efficient to have a ready-to use list of generic project risks and triggers. A project team then simply compiles the list by adjusting generic risks and by adding the project-specific project risks. Risk management process of this kind shall lead to a Risk Register (Risk Matrix) in the form of a clearly table. Such a risk register is easy to maintain and review, for example, during periodical status meetings. In the end, Wrona points out that identification of triggers and preventive actions is vital, though too often ignored in practice. In such a case, project teams may end up in constant reaction mode responding to unexpected events threatening the project implementation and its deliverables.
  23. 23. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 23 Figure 4: Risk Register example2 Practicality of Wrona’s approach to risk management in project management is demonstrated by its use in the Westbahn project plan. Westbahn project team members are encouraged to generate dozens of risk items in the first step. The second step refines them by cutting duplicates and by listing particular risks in one single structured list. The third step makes sure that each risk is assessed on all its attributes, that is, likelihood, impact and detectability, by assigning the values from 1 to 4. These three attributes are consolidated in the risk score helping rank the risks in the table. Steps four, five and six deliver triggers, preventive actions and contingency plans. Step seven makes sure that each risk item receives a particular risk owner from the project team. All this results in a single well-arranged risk register table. Wrona’s approach is concluded appropriate for the Westbahn project. It is advantageous for its ease, brevity and speed. It can be easily introduced and followed without much effort. The risk register is complete, short and accessible to each project team member. It can be easily maintained and kept relevant by quickly going through as a part of every project status team meeting so that risk is constantly monitored during the entire project work. 2 A generic risk register template in MS Excel format was downloaded from <http://www.projectmanagementdocs.com/templates/risk-register.html>
  24. 24. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 24 Conclusion This coursework has examined the entire project plan development for a project of a smaller size in the environment of small and medium enterprises of Hahn Air and Westbahn. For the business case assessment, the efficient BOSCARD technique was found instead of preparing any exhausting Statement of Work and Scope Statement. Fishbone Analysis was identified as an appropriate supporting analytical technique and its use demonstrated on project scope definition. Project planning and scheduling was backed up by Work Breakdown Structure, Network Diagram and Gantt Chart. Project organization was set up by attaching WBS to Matrix Organization. In terms of project monitoring and control, Singh’s tactic was found appropriate for its clarity, simplicity and practicality. This tactic was extended by guidance from Nicholas & Steyn on five project areas to control – scope, quality, schedule, procurement and cost. Regarding cost control, Earned Value Management was scrutinized and concluded excessive for this project. Instead, working hours as a project cost indicator was found sufficient. Careful and thorough project definition and diagnosis with strategy and planning combined with project risk management was concluded to reduce problems and uncertainty in this project. Moreover, Wrona’s approach to establishing and maintaining practical risk management was recommended for this project. In conclusion, theoretical preparation of a project for railway distribution in airline GDS is successfully accomplished. The selected project management procedure and techniques will facilitate and accelerate groundwork and execution of the actual Westbahn project.
  25. 25. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 25 Reference List Ansoff, H. I. (1965). Corporate Strategy. New York: McGraw-Hill. Chapman, A. (n.d.). Project management, tools, process, plans and project planning tips. Retrieved 4 8, 2012, from Businessballs: http://www.businessballs.com/project.htm Dwivedi, U. (n.d.). Earned Value Management Explained. Retrieved 05 08, 2012, from ProjectSmart: http://www.projectsmart.co.uk/earned-value-management- explained.html Flouris, T., & Lock, D. (2008). Aviation Project Management. Ashgate. Grundy, A., & Brown, L. (2002). Strategic Project Management: Creating Organizational Breakthroughs. Thomson Learning. Haughey, D. (n.d.). BOSCARD (Terms of Reference). Retrieved 4 10, 2012, from Project Smart: http://www.projectsmart.co.uk/boscard.html Nicholas, J. M., & Steyn, H. (2012). Project Management for Engineering, Business and Technology (4th Edition ed.). Routledge. Peters, & Waterman. (n.d.). In Search of Excellence. Roman, D. (1980). Science, Technology, and Innovation: A Systems Approach. Grid Publishing. Singh, M. (n.d.). Project Smart. Retrieved 05 01, 2012, from www.projectsmart.co.uk: http://www.projectsmart.co.uk/docs/quick-guide-to- project-management.pdf Wilkens, T. T. (1999, 04 01). Earned Value, Clear and Simple. Retrieved 05 08, 2012, from ProjectSmart: http://www.projectsmart.co.uk/docs/earned- value.pdf Woods, M. (2012, 03 29). Using Earned Value Management as an Early Warning Sign in Project Management. Retrieved 05 01, 2012, from ProjectSmart: http://www.projectsmart.co.uk/using-earned-value-management-as-an-early- warning-sign-in-project-management.html Wrona, V. (n.d.). Your Risk Management Process: A Practical and Effective Approach. Retrieved 4 26, 2012, from Project Smart: http://www.projectsmart.co.uk/your-risk-management-process-a-practical- and-effective-approach.html
  26. 26. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 26 Appendix 1: A BOSCARD Table Example3 Project Name WESTBAHN Project Sponsor HAHN AIR Strategic Fit Non-airline content (NAC) Project Manager Ramya Muniandi Date Raised April 10, 2012 Lead Function Simon Riha Background Provide background information that includes the reasons for creating the project and mentions the key stakeholders who will benefit from the project result. Market situation in GDS: There are just a few scattered railways. Railway distribution and systems incompatible with GDS. No simple solution for processing e- tickets at railway stations and on trains. Consequence: No provider has come up with any solution yet due to its marginal significance for railways. Market demand in GDS: Significant. Trains faster and more convenient means of transportation up to 400-500 Kms. Airlines gradually discontinue short flights. Travel agents ask for railways in GD to combine air-rail. 4 ground carriers have shown their preliminary interest. Conclusion: An opportunity for Hahn Air to launch a new distribution solution. External stakeholders: • Railways to access GDS for global sales. • Airlines to interline with railways. • ravel agents. Internal stakeholders: • Hahn Air Systems • Hahn Air Global Service Desk Objectives Describe the project goals and link each of them with related project objectives Project goal: Building a solution for bringing railways and other ground transportation means into the GDS easily, quickly and at low cost and making them in GDS user-friendly for both agents and travellers. Solution shall generate minor (besides the existing core distribution channels) but still significant sales for railways and Hahn Air. Demonstrate with Westbahn. 3 A generic BOSCARD table template was downloaded from <http://www.projectsmart.co.uk/docs/boscard-template.doc>.
  27. 27. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 27 Project objectives: • Make 3 Westbahn's routings (VIE/SZG, VIE/LNZ, SZG/LNZ) saleable exactly as flights in GDS • Check-in and boarding the train shall be simple, seamless and idiot-proof. • Standard ticket revenue accounting process and revenue settlement. • Solution shall be replicable beyond Westbahn without substantial modifications. • Solution shall be scalable towards interlining and code-sharing with airlines. Scope Provide a high-level description of the features and functions that characterise the product, service, or result the project is meant to deliver. Within Scope E.g. • FDL (Flight Data Load) • ATPCO fare filing (fares & rules) • E-ticketing • … Outside Scope • Code-sharing with airlines • E-ticket conversion into PDF (Developed in future solution versions) Constraints Identify the specific constraints or restrictions that limit or place conditions on the project, especially those associated with project scope. E.g. • Use the existing system infrastructure only. • No external suppliers. Assumptions Specify all factors that are, for planning purposes, considered to be true. During the planning process these assumptions will be validated. E.g. • Westbahn will be distributed under H1 designator. • … Risks Outline the risks identified at the start of the project. Include a quick assessment of the significance of each risk and how to address them. E.g. • … Deliverables Define the key deliverables that the project is required to produce in order to achieve the stated objectives. E.g. • …
  28. 28. EAC PM Railway GDS Distribution Simon Riha May 14, 2012 28 Project Resources People and their time, plus non-people resource e.g. systems, plant capacity etc. Ramya Muniandi Project Manager Vlado Vasilev System Engineer Unisys Aircore PSS MS BizTalk Server Project Approval Name Role/Job Title Signature/Date Hans Nolte CEO Simon Riha EVP Business Development Mathieu Montmessin Managing Director Hahn Air Systems GmbH

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