Dr. Janet Cosman-Ross

Abstract

We will examine the effectiveness of project management at different stages and describe the statement of work and specifications provided by the city to the project management team in the design phase. Deductions will be assessed asserting conclusions about the use of project management in the building of Denver International Airport. Finally, recommendation as to how things could have been done differently will be made.

Stakeholders

Projects of this magnitude host a myriad of stakeholders. The Denver International Airport project had stakeholders ranging from Indian tribes to major international companies and the federal government. We will examine the key stakeholders who had significant impact in the major issues of the project. A complete list of stakeholders is in appendix A of this document.

The City of Denver

The city of Denver was a primary stakeholder. They were also a sponsor, and part of the Project Management Team. The city wanted the airport to be a ‘thing of beauty’ and a place where travelers would remember a positive reflection on Denver. The Denver International Airport would be a benchmark airport and serve Denver for the next 50 to 60 years. The leaders were under tremendous pressure throughout the project from key stakeholders, financial stakeholders, bond rating companies and constituents.

Two consulting firms were key stakeholders and part of the Project Management Team. The first of these was Morrison Knudsen Corporation a design-construct firm incorporated in 1932. Morrison Knudsen Corporation had worked many large projects including the Hoover Dam, WWII airfields, and space program projects. The company met with tough times in the 1980’s and was restructured in the late 1980’s. (Fundinguniverse.com). The other primary consulting firm was Greiner Engineering, an engineering, architecture, and airport planning firm. These firms had their reputations at stake.

The Airlines – Staying Grounded

BAE Automated Systems

Critical Issues

Scope Creep

While both Continental and United Airlines made changes that required significant re-designs, United requested a ‘Destination Coded Vehicle’ baggage handling system, since it was coined as the ‘automated baggage system’. This was to be in concourse ‘B’ only. The destination-coded vehicle (DCV) baggage han­dling system was a complex, computerized system that had only been installed once before in Frankfurt Germany.

So what did the city decide to do? They decided the system should encompass the entire airport! They decided to install this unproven system throughout the entire airport, even without a vendor selected at the time. And yes, they announced they would still be on time for the opening.

Strengths, Weaknesses, Opportunities, and Threats Analysis

Strengths

While offering a large through-passenger revenue hub location, Denver also hosted a proven air system with experienced personnel at the ready. Stapleton International Airport in Denver was the fifth busiest airport in the nation. After deregulation, three different airlines operated large hubs out of Stapleton (Frontier Airlines, Continental Airlines, and United Airlines).

Denver mixes urban style with outdoor adventure, making it and the surrounding area an attractive destination. With clear mountain air, city events and snow skiing nearby Denver plays host to a vast array of tourism. Colorado is currently ranked as number five by NBC as America’s Top States for Business and boasts industries in sectors such as aerospace, bioscience, broadcasting and telecommunications, energy, financial services, and information technologies.

Weaknesses

Opportunities

Threats

As identified previously, the airlines were affected during the 1990 to 1991 recession, Continental in bankruptcy and United reported record losses. Cost per square foot would be up to three times that of current regional airports. The expense was to be borne by the air-carriers, cargo carriers and tenants of Denver International Airport. This issue contributed to the user stakeholder community’s lack of interest in Denver International Airport and played a role in many of the design changes.

The availability of skilled workers also became problematic. All of these factors culminated into the bond rating company’s negative assessment of the city’s bonds issued. At one point, the bond rating by one company was just above ‘junk bond’ rating.

Risk

Project Management Team Effectiveness

Strike two was the fact that they had no plan to mitigate the loss of key players during the project. The Project Management Team did not identify differences between sponsor desires and user requirements, nor did it identify issues with the initial design, (for example, initial standard concrete roofing techniques), and not meeting cost requirements. It was further stated in the case study that, the city mandated the design teams to continue seeking for bids without any official input from the users (Kerzner, 2013).

The city buckled under pressure from rising interest rates / bond ratings and provided enticements to Continental and United Airlines while committing to the original opening date. Attempts at crashing the schedule led to employee burn-out and there was no end in sight. Scope creep was affecting the schedule. United Airlines requested the automated baggage system for Concourse ‘B’ only, yet the city decided to have it installed throughout the airport.

Project Management Team in Disarray

As reported February 6, 1994 in the Houston Chronicle Doughty asserted apprehension about Mayor Webb, stating; "I am very concerned about some management errors under Mayor Webb, who doesn't have the management ability or guts to manage a project like this. He let the airlines and contractors roll over him. If he hadn't have done that, it would have been completed on time.'' (Sahagun, 1994)

Within the same year of Doughty’s’ resignation, Chief Airport Engineer Walter Slinger, supporter for the automated baggage system, died just six months after the automated baggage system project started. Gail Edmond, his replacement, acted without the same autonomy and power Slinger had because the Denver City Council tied her hands. The baggage system installation went downhill from there having issues with labor agreements to the supplier being allowed free access to the airport as expected.

Work Breakdown Structure / Specifications

Area #2 Roadways and on-grade parking

Area #3 Airfield

The master plan called for four concourses with 60 gates each and the original plans called for a train running through the terminal via tunnel underneath. Roadwork adjacent to the airport would take one year and the runways would be scheduled to take two years, even though they could be done in one year, to save on cost.

What I Would Have Done Differently as a Project Manager

Much is written about the failure of the Denver International Airport baggage system but the airline participation could have averted some of this, or at least provided for better upfront planning. With the way it was, the city was behind and bowing to the airlines whims.

Greiner Engineering, An engineering, architecture, and airport planning firm. (n.d.) Retrieved from http://www.greniereng.com on September 19, 2009.

Kerzner, H. (2001). Project management: A systems approach to planning, scheduling, and controlling. New York: John Wiley.

United Airlines. (n.d.). Retrieved from http://www.united.com on September 19, 2009.