The Governance Problems and Possible Solutions
1.Summarise the Governance problems and suggest solutions
2.Using Borne and Walker’s article (see embedded object below), Draw a Stakeholder Circle to show the influence and power of all Stakeholders in this project. Remember to include a legend to clarify each stakeholder.
3.Using your Stakeholder Circle, Identify TWO key stakeholders, analyse their interests, influence and distance, and suggest and justify how they should be managed (refer to embedded object at the end of this document).
The Perth Athena Project is an under construction area mostly set up of a multi-purpose sports and entertainment and had been planning to start operating by 2012. The project is a classic case of misunderstood or lack of knowledge for project cost and timeframes to take the responsibility of the scope, plan, tender and contract for the entire arena had failed to audit and plan for the entire project and failed miserably (Walker, James and Mills 2015). The following report would thus consist of a summary of five of the governance problems that had caused the failure and their supposed solutions. This would be followed by a stakeholder circle that had been influenced by the project failure and their powers in the project with a legend to clarify each stakeholder. Using this stakeholder circle, their interests would be analyzed with their influence and distance with the project and justification of their management strategies.
There had been several wrong assumptions made and that had caused the failure of the entire project. Out of the problems listed as per the case study, five of the Governance problems are to be described in details as below with the possible feasible solutions they might have had to mitigate the problems faced.
Governance problems in the project: There have been several governance problems related to this project and these are as listed below:
- Lack of Governance structure: The project for Perth Athena had a tentative time of completion by 2012, therefore the team for taking the responsibility of handling the project had been appointed in 2007 (Liu, Yan, and Wilkinson 2016). However, even after the project was handed over to the authorities, there have been no appropriate structure established for the governing bodies to look after the project and even a client agency was not appointed even by 2009.
- Lack of asset management framework:The team of Department of Housing and Works or DHW had been appointed to scoping, planning, tendering and contracting the arena for the upcoming project. However, the DHW team had failed to put together the critical components of the Strategic Asset Management Framework and also there were to applied internal frameworks from the DHW team. There had been no key plans of management for the project.
- Inadequate setup of Project Team:The project team required for the Perth Athena Project was faltering in the basic planning and the maximum trouble had occurred in the resource planning for the project team (Nicholas and Steyn 2017). The lack of resource allocation in a project management team would thus be essentially problematic.
- Poor record keeping techniques: The problems that arose with applying wrong techniques to keep the essential records about the project had disobeyed the State Records Act of 2000. This fails to keep the appropriate evidence of planning, reporting and monitoring which further fails to keep any records of the contract negotiations.
- Understanding of responsibilities by the agency: The agency had been poorly keeping track of its responsibilities and this has been creating more problems than usual. The major problem of budgeting without checking the resources is a result of lack of responsibility in all levels of management.
Possible solutions to the problems: Below are the possible feasible solutions to the above problems in the project management of the Perth Athena construction project:
- Governance Structure:The Governing body of the entire project implemented faulty governance practices to set up the project and team allocations. This would only be mitigated by the foresightedness of the Governing body about the project progression, team allocation and understanding of the project and resource balance.
- Asset Management Framework:It is the responsibility of the Finance Department to put into action more active oversight of the major projects so that they ensure the consistent applications of Strategic Asset Management Framework in the project (Burtonshaw-Gunn 2017). The problem could have been mitigated if the project approval process had been more rigorous to stage.
- Setup of Project Team:Setting up of the project team had been amiss and it should have been eradicated if the governing bodies had set up a team comprising of responsible and skilful members who had proper understanding of the wholesome outcome and insights about the project.
- Record keeping technique:The problems of record keeping can only be mitigated with thorough concentration of managing records by the team allocated on a daily basis. In addition to this, there must be appropriate records established and maintained that would meet all the obligations that are imposed by the State Records Act of 2000 (Senaratne, Jin and Srirathan 2015).
- Understanding the responsibilities:The Department of Housing and Works or DHW was appointed as the agency to take care of the project propagation; however, it had failed in its task miserably. It would have been better if the agency had put the governance structure in order along with the project management systems which would have put forward the complexity and the scale of the project (Hay et al. 2017). The agency should have taken legal advice to maintain the perspective of the government providing full and complete advice about project status, risks, and decisions.
Figure 1: Stakeholder Circle
(Source: Created by the Author)
From the Stakeholder Circle illustrated above, it can be identified that the two key stakeholders in the project of Perth Athena construction had been the Expenditure Review Committee and the Key Consultants of the project keeping the Cabinet under exemption (Hay et al. 2017). These two stakeholders had the most responsibility besides the cabinet to make the project a success.
Stakeholder Circle and their Influence of Power
Analysing interest, influence and distance of the key stakeholders
Expenditure Review Committee: The responsibility or interest of the expenditure review committee had been the analysing of the project’s prospected budget and review it well to understand if the expenditure list had been justified or not. If the project goes over budget, the responsibility of the Expenditure Review Committee is to look after it and revise as per susceptible requirements (Oakland and Marosszeky 2017). The Expenditure Review Committee can even influence the Cabinet and the Board of Directors to take their inputs into considerations. The distance of these stakeholders are closer to the Cabinet and the Board of Directors and they are even not far in position from the team of implementers that have been given the responsibility to propose the budget and prepare an audit based on the project budget.
Consultants: It is the interest of function or responsibility of the consultants to check for the issues related in a project after the project has been proposed with all the possible assumptions. Here, the Consultants were responsible of imposing the possible assumptions, which have proven to be hastily taken decisions and wrong consulting. The influence of these stakeholders introduce the budget factor in the project, this means that, the consultants assumptions and ideas bring forth the foundation budget plans (Mubarak 2015). The budget plans for the Perth Athena project had been over board and wrongly adjusted because of the incorrect assumptions made by the consultants. The consultants are not in close proximity with the Directors or the Cabinet board but they have a lesser distance with that of the Financial Team appointed for the project propagation.
- Mapping of the Stakeholders:The first and foremost step of managing the identified key stakeholders is by identifying the primary factors that drive these stakeholders. This would include the proper mapping of the resources of the organization with that of the stakeholder’s interest.
- Influencing the Stakeholders:Resources and interest matching in an organization makes it easier to predict the interaction of the stakeholders with the other project team members (Tabassi et al. 2016). This makes it easier to understand the scale of the stakeholder and influence them accordingly.
- Identification of the triggers:The understanding of the above two aspects will follow the proper understanding of the triggers to which they would react. This enables to avoid any conflict that might arise during the project progression for the stakeholders.
- Seeking opportunities:This suggestion takes risk management factors into account. It should be taken into consideration that both these stakeholders along with the others should be made thoroughly interested in the project throughout its progression (Wang et al. 2014). This would be guided by the identification of the stakeholder’s interests.
- Proactive mitigation:Understanding the interests of the Stakeholders and their triggers, it is important to prepare a mitigation plan. This would be the risks in the project and how much they can be accepted or rejected (Harrison and Lock 2017). Their impact on the project would be calculated equally including the negotiable and the non-negotiable factors. This would increase the credibility of the stakeholders in the project.
Conclusion
Therefore, it can be concluded that the Perth Athena Project is a classic case of misunderstood or lack of knowledge for project cost and timeframes, and the cause that it failed had been due to the wrong estimation over absurd assumptions. The following report thus consists of a summary of five of the governance problems that had caused the failure and their supposed solutions. This had been followed by a stakeholder circle which analyses the influence and distance with the project and justification of their management strategies. The report has established the fact that the failure of this project has been due to misjudgement of possible outcomes because of lack of foresightedness and knowledge. However, the report has also suggested how these problems could have been avoided and how the ways to mitigate the problems affect the stakeholders of the project. This is shown by a stakeholder circle and also the possible ways to manage their roles.
References
Burtonshaw-Gunn, Simon A. 2017. Risk and financial management in construction. Routledge, 2017.
Harrison, Frederick, and Dennis Lock. 2017. Advanced project management: a structured approach. Routledge, 2017.
Hay, Andrew, Jian Zuo, Sangwon Han, and George Zillante. 2017. “Lessons Learned from Managing a Remote Construction Project in Australia.” In Proceedings of the 20th International Symposium on Advancement of Construction Management and Real Estate, pp. 939-948. Springer, Singapore, 2017.
Liu, Tingting, Yan Wang, and Suzanne Wilkinson. 2016. “Identifying critical factors affecting the effectiveness and efficiency of tendering processes in Public–Private Partnerships (PPPs): A comparative analysis of Australia and China.” International Journal of Project Management 34, no. 4 (2016): 701-716.
Mubarak, Saleh A. 2015. Construction project scheduling and control. John Wiley & Sons, 2015.
Nicholas, John M., and Herman Steyn. 2017. Project management for engineering, business and technology. Routledge, 2017.
Oakland, John, and Marton Marosszeky. 2017. Total construction management: Lean quality in construction project delivery. Routledge, 2017.
Sears, S. Keoki, Glenn A. Sears, Richard H. Clough, Jerald L. Rounds, and Robert O. Segner. 2015. Construction project management. John Wiley & Sons, 2015.
Senaratne, Sepani, Xiaohua Jin, and Sabesan Srirathan. 2015. “Knowledge management in construction organisations in Australia using social network analysis: a research framework.” In Making Built Environments Responsive: Proceedings of the 8th International Conference of the Faculty of Architecture Research Unit (FARU), University of Moratuwa, Sri Lanka, 11 December 2015, pp. 333-343. 2015.
Tabassi, Amin Akhavan, Kamand M. Roufechaei, Mahyuddin Ramli, Abu Hassan Abu Bakar, Radzi Ismail, and A. Hamid Kadir Pakir. 2016. “Leadership competences of sustainable construction project managers.” Journal of Cleaner Production124 (2016): 339-349.
Walker, Derek Henry Thomas, James Harley, and Anthony Mills. 2015. “Performance of project alliancing in Australasia: a digest of infrastructure development from 2008 to 2013.” Construction Economics and Building 15, no. 1 (2015): 1.
Wang, Wei-Chih, Shao-Wei Weng, Shih-Hsu Wang, and Cheng-Yi Chen. 2014. “Integrating building information models with construction process simulations for project scheduling support.” Automation in construction 37 (2014): 68-80.
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