(Answered) QSO 645 Milestone Two: Planning Measures, Budget, Project Risk

Overview: The purpose of Milestone Two is to help you prepare for the final project by allowing you to review specific elements of your chosen project.

You will describe, assess, and evaluate planning, budget, and risk measures taken in the project, and you will consider areas that were handled well and specific areas where improvements could have been made.

You are expected to gather information from both the course and outside resources to assist in preparation for your thorough assessment of all knowledge areas at the end of the course. Once complete, this milestone will become a component of the final project.

Prompt: Examine the planning measures that were used in the project, assess the budget of the project, and identify major project risks and corresponding control tactics.

Specifically, the following critical elements must be addressed:

IV. Planning measures

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V. Budget

1. Assess the budget of the project, including a description of efficiencies and inefficiencies in how the budget was managed.
2. Explain possible contingency allotments and limitations.
3. Recommend any adjustments to the budget that were necessary, providing reasoning.

VI. Risks a d control tarisk response planning executed based on the major project risks and control tactics, and explain the missed and exploited

opportunities in the project.

B. Summarize qualitative and quantitative measurements of major project risks.

Guidelines for Submission: Your paper should be a 4- to 5-page Microsoft Word document with double spacing, 12-point Times New Roman font, one-inch margins, and at least three sources cited in APA format.

Rubric

A+ Answer Milestone Two: Planning Measures, Budget, Project Risk

Planning Measures

The Airbus A380 project was one of the most complex and ambitious aircraft projects ever undertaken. It required a highly detailed and organized schedule to ensure its success. 

The project was set to commence in 2000 and launched in 2002 and involved a clear timeline that required a considerable budget outline but was later characterized by budget overruns and a series of failures that forced some of the company executives to resign (Baumann, 2014).

The Airbus A380 project was designed and assembled collaboratively by 16 Airbus locations in France, Spain, the UK, and Germany. The Toulouse plant in France was built specifically for the final assembly of components for the Airbus A380 Project.

The design centers were to use a new assembly process approach based on laser-based measurements approved by the managers in charge of the project as part of the plan.

The new strategy was designed to accomplish two primary goals. First, rather than using the devices as a reference system, evaluate individual components about one another. The second objective was to figure out how to put together sophisticated interfaces.

This procedure would be complicated and inefficient. According to Thierry Fabre, the fundamental problem in planning the Airbus A380 was the lack of consistent aircraft reference standards for all four Airbus A380 design centers to adopt (Jackson,2021).

Each location had its own goals, limits, and working methods. One example is allowing the teams to prepare their technical drawings using two distinct versions of software.

CATIA4 was used by the German and Spanish designers, whereas CATIA5, an improved performance that required a complete rebuild, was utilized by the French and the United Kingdom’s teams.

Discrepancies in the project timeline

The timeline of the Airbus A380 project saw many discrepancies, some of which were inevitable, and some could have been avoided.

One of the most notable discrepancies was the decision by the project executives to continue with the project despite the variation in CAD software used by the two teams in German and Spain and another team in France and Britain. 

The long rivalry and cultural differences between the team in France and German further considerably affected the project. The poor coordination led to project failures as it turned out that the two teams needed more unity of purpose.

Another notable discrepancy in the Airbus A380 project was that the models made in one version did not transfer successfully to the upgraded version (Jackson, 2021). The German teams needed help incorporating their electrical wiring design improvements into the three-dimensional digital mockup in Toulouse.

The preassembled harnesses, which included hundreds of kilometers of cabin wire manufactured in Germany, did not fit appropriately into the aircraft at the French assembly site. The differences wreaked havoc on the plan, prompting several delays that pushed the project back by two years.

 The discrepancies, delays, and project failures of Airbus A380 could have been avoided or minimized if the project manager could have conducted a more thorough software testing process to identify and fix any software issues before the aircraft was ready to enter service.  

All project stakeholders in all 16 locations of the project implementation could have been closely and consistently consulted to guarantee the project’s success. The input from the project stakeholders could have helped in designing a project scope baseline to support the progress and execution of the project.

Another discrepancy in the timeline of the Airbus A380 project was the delay in the aircraft’s certification.  This delay was mainly due to issues with the aircraft’s engines not meeting the required certification standards.

To handle this discrepancy, the project manager could have implemented better quality control procedures to ensure that all components and engines were up to the required standards.

Airbus A380 Project Budget

The Airbus A380 project was an ambitious undertaking, with an estimated $10 billion budget. However, the project was fraught with delays, cost overruns, and other inefficiencies.

For instance, by 2006, the budget overrun was $ 2 billion, and the project was behind schedule by two years. Additionally, in October 2006, Airbus was hit by another delay.

They could push the project to 2007, resulting in another budget overrun of nearly $ 4.1 billion. The company could only deliver one aircraft against the 25 that had initially been planned (Dörfler & Baumann, 2014).

Another budget inefficiency was announced in 2008 by Wall Street Journal, and according to the report, the delay could push the budget further by almost 50 % of its original budgetary allocation.  

Meanwhile, Airbus was forced to go back and fix significant design flaws, which added more costs and delays to the project. For instance, the front section and nose of the Airbus A380 were built in France; the wings were developed in the United Kingdom, while the tail was developed in Germany.

Airbus also had issues with its suppliers. Suppliers failed to deliver parts on time, and some parts needed to be up to the company’s quality standards.

This resulted in increased costs and delays (Kishore, 2019).  Besides, there were also issues with the plane’s wings, which were too heavy and had to be redesigned. In terms of efficiencies, Airbus successfully managed the project’s risk, as the company could identify and address potential problems before they became an issue.

One of the most efficient ways Airbus managed the project was through its use of modular assembly. By breaking down the project into smaller modules, Airbus managed the project more effectively and efficiently.

For example, they could assign specific tasks to various teams, allowing them to focus on their responsibilities and complete their assignments promptly.

Contingency allotment and Limitations

 The Airbus A380 project has various possible contingency allotments and limitations. One possible contingency allotment was changing the plane’s design from a two-deck design to a three-deck one. This allowed for more passenger space and increased the plane’s seating capacity from 525 to 853.

This allowed the aircraft to move more passengers, thus increasing its overall effectiveness (Nelson,2020).  Another possible contingency allotment was the decision to increase the size of the plane significantly.

This allowed for a larger fuel capacity, which enabled the plane to fly further distances, thus increasing its value to airlines. It also increased the cargo that could be carried onboard, allowing airlines to transport more goods.

 On the other hand, one limitation of the Airbus A380 project is the cost of the plane. In 2006 the company announced the delays in the delivery of the Airbus A380 that could potentially affect the company’s operating profits by close to $ 4.1 billion for three years from 2007 to 2010.

Besides, the plane is costly to buy, maintain and operate, thus limiting its use to only the wealthiest airlines. This has made it difficult for some airlines to justify the cost of the plane, making it a less attractive option.

Another limitation of the Airbus A380 project is the complexity of the aircraft. The plane is a complex engineering piece requiring an experienced crew to operate.

Some adjustments could have been necessary to control and ensure effective budget management of the Airbus A380 project. The budget should be adjusted to include more research and development funds to assess the project’s feasibility better and develop more efficient production methods.

This money could be used to hire additional engineers and pay for testing equipment, and it would likely lead to better-designed aircraft in the long run (Kumar, 2022). Besides, the budget could be adjusted to account for inflation and the changing costs of raw materials.

More importantly, the budget should also be adjusted to include contingency funds in case unexpected problems arise. This would provide a buffer in case of a technical issue or other unforeseen circumstances that could threaten the project’s success.

By accounting for these changes in advance, the A380 project will be better prepared to handle any issues that arise throughout its development.

By using a change control process to monitor and control the budget, the project team could have minimized, if not avoided, the budget overruns and protracted delays in launching and delivering the plane.

Risk and control tactics

The comprehensive risk response planning is based on the Airbus A380 project risks and control tactics. One of the main objectives of the risk response plan was to identify and mitigate potential risks associated with the project.

The program included risk identification and assessment, risk evaluation and prioritization, risk control tactics, and risk monitoring and reporting. The risk identification and assessment process identified the key risks associated with the project, such as cost overruns, schedule delays, and technical challenges.

The risk evaluation and prioritization process then prioritized the risks based on their likelihood and impact (Ika et al.,2021). This allowed the project team to focus on the most critical threats. The risk control tactics included risk avoidance, risk reduction, risk transfer, and risk acceptance.

These tactics were employed to help manage the identified risks. The risk monitoring and reporting process allowed the team to track progress on the risk management plan, review risk exposure levels, and take corrective action as needed (Vasigh & Azadian, 2022).

This helped ensure that the project was kept on track and that any risks that did arise were managed effectively. The project exploited opportunities in risk management through stakeholders’ involvement.

However, despite the ambitious risk management plan, some opportunities were missed. For instance, the program needed to recognize potential delays in the supply chain.

The project plan focused on the mechanical and structural design of the aircraft but did not consider the possible delays in the supply chain that could impact the project timeline.

The Airbus A380 project was confronted with potential risks that could be measured qualitatively and quantitatively.

To secure the participation of all significant A380 stakeholders, the project manager might have sought anonymous inputs as part of the risk detection process to acquire the best results identifying risk for the qualitative assessment.

Using probabilities and impact matrix enables individuals to subjectively rank threats, allowing the Project Managers to determine which risks require immediate attention and which may be addressed later. Qualitative hazards include customer requirements changes, sub-contractor performance delays, and regulation changes.

References

Baumann, O. (2014). Learning from a Drastic Failure: The Case of the Airbus A380 Program. Industry and Innovation, 21(3), 197-214.

https://ideas.repec.org/a/taf/indinn/v21y2014i3p197-214.html

Dörfler, I., & Baumann, O. (2014). Learning from a severe failure: the case of the Airbus A380 program. Industry and Innovation, 21(3), 197-214.

https://www.tandfonline.com/doi/abs/10.1080/13662716.2014.910891

Ika, L., Couillard, J., & Garon, S. (2021). Coping with project complexity: The complexity-based project management framework. PM World Journal, 10(5), 1-22.

https://pmworldlibrary.net/wp-content/uploads/2021/05/pmwj105-May2021-Ika-Couillard-Garon-coping-with-project-complexity.pdf

Jackson, R. (2021). Airbus A380. Airbus A380, pp. 1–88.

https://www.torrossa.com/it/resources/an/4914267

Kumar, B. R. (2022). Case 2: Developing the World’s Largest Passenger Aircraft-Airbus A3XX. In Project Finance (pp. 91–99). Springer, Cham.

https://link.springer.com/chapter/10.1007/978-3-030-96725-3_6

Kesore, L. V. (2019). Discontinuation of the Airbus A380 product line–a multi-level perspective on governance actors in Germany (Bachelor’s thesis, University of Twente).

http://essay.utwente.nl/78955/

Lavigne, L., Zolghadri, A., Goupil, P., & Simon, P. (2008, December). Oscillatory failure case detection for new generation Airbus aircraft: a model-based challenge. In 2008 47th IEEE Conference on Decision and Control (pp. 1249-1254). IEEE.

https://ieeexplore.ieee.org/abstract/document/4738621/

                         Nelson, C. A. (2020). Investigating the Airbus A380: Was it a Success, Failure, or Combination? (Doctoral dissertation, University of Oregon).

https://scholarsbank.uoregon.edu/xmlui/handle/1794/25788

Vasigh, B., & Azadian, F. (2022). Evaluation and Fleet Selection Process. In Aircraft Valuation in Volatile Market Conditions (pp. 369-404). Springer, Cham.

https://link.springer.com/chapter/10.1007/978-3-030-82450-1_10

Related Reading

(Answered) Milestone One: Project Vision, Scope, and Stakeholders

(Answered) Milestone Three: Project Control Techniques, Communication Plan, and Resource Management