Reference no: EM131844113

Case Study: Life and Death of an Aircraft Development Project

Law and Callon described the history of a large British aerospace project in terms of two entities: the global system and the project itself. The global system comprised parties and organizations outside the project that had a stake in the project; the project comprised everything within the project including all work and the organizations contracted to do it.

THE GLOBAL SYSTEM

The principal stakeholders in the global system were: 1. The Royal Air Force (RAF), which initiated the project with a request for a new supersonic aircraft with short take-off capability. The aircraft would be a "tactical strike and reconnaissance fighter" called TSR. 2. The Ministry of Defence (MOD), which wanted an aircraft that would best fit the nation's current overall defense needs. 3. The Treasury, which wanted an inexpensive aircraft that would have market appeal for sale outside the UK, such as to the Royal Australian Air Force (RAAF). 4. The Royal Navy (RN), which wanted to buy a different aircraft but was under pressure by MOD to buy the TSR. 5. The Ministry of Supply (MOS), which wanted an aircraft that would be produced by a consortium of several UK airframe and engine manufacturers. As is typical of most projects, each stakeholder in the global system conceptualized the project differently: to the RAF and MOD it would yield an aircraft for a specific mission; to the Treasury it would fit the defense budget and generate revenue; to the RN it was a competitive threat to the aircraft they really wanted; and to the MOS it was an instrument of industrial policy. The parties had different reasons for contributing resources and support: some were economic (in return for funds, an aircraft would be built); some political (in return for a demonstrated need, objections of the RN would be overruled); some technical (in return for engineering and technical effort, the aircraft would meet RAF performance requirements); and some industrial (in exchange for contracts, the aircraft industry would be consolidated).

THE PROJECT

The Treasury would not approve project funding until the aircraft's basic design, manufacturer, cost, and delivery date were defined. The RAF and MOD sent requests to the aircraft industry for design ideas, and selected two manufacturers: Vickers Corp. and English Electric (EE). They favored Vickers for its integration capability (combining aircraft, engine, armaments, and support equipment into a single weapons package), but they also liked EE for its design experience with supersonic aircraft. So they decided to contract with both companies and adopt a design that would utilize features from both. The idea was approved by all other parties in the global system, and funding for the project was released. The project grew as Vickers and EE hired subcontractors and expanded their teams for design, production, and management. The two companies and several other contractors merged to form a single new organization called the British Aircraft Corporation (BAC).

RELATIONSHIPS BETWEEN THE GLOBAL SYSTEM AND THE PROJECT

As the project grew, so did the problems between it and the global system. The MOS wanted centralized control over all aspects of the project, and all transactions between the project and stakeholders in the global system. Although BAC was the prime contractor and ostensibly responsible for managing the project, the MOS would not confer upon it the necessary management authority. Rather, the MOS formed a series of committees with members from the global system and gave them primary responsibility to manage the project. This led to serious problems: 1. The committees were allowed to make or veto important project-related decisions. They, not BAC, awarded important contracts; when the RAF wanted to change its requirements, it consulted with the committees, not with BAC. 2. The committees often lacked sufficient information or knowledge. Technical committees made decisions without regard to costs; cost committees made decisions without regard to technical realities. Decisions focused on particular aspects of the project; seldom did they account for impacts on other parts of the project, or the project as a whole. Distrust grew between BAC and the MOS; neither was able to effectively integrate the resources, information, and decisions flowing between parties in the project and the global system. Subcontractors became difficult to control. Many ignored BAC and worked only with the MOS and RAF to get favorable treatment.

GLOBAL SYSTEM RESHAPED

Everyone knew the project was in trouble. Project costs doubled. One of the test engines exploded, and the RAF recognized it might take years to understand the cause. In addition, the RAAF announced that it would not order the TSR but was instead buying the US-built F-111. Opposition to the project grew, and in the upcoming general election the Labour Party promised that if elected it would review the project. When the Labour Party won, it immediately began an assessment of the project, which included comparing the TSR to the F-111-considered by now an alternative to the TSR. As cost overruns and schedule delays continued, the MOS slowly withdrew support. The RAF then withdrew its support, when it discovered that the F-111, which was already in production, would meet all of its requirements. The project was canceled.

Questions: 1. In this case history, what is the "system" and what are its elements? What is the "environment," and what are the elements of the environment?

2. Describe the interaction between the system and its environment.

3. Do you feel that important decisions made in this project represent "system thinking"? Explain.

4. Comment on the concept of "integration" in the project. How were aspects of the project integrated or not integrated?

5. What are the main factors that contributed to cancellation of the project? Which of these factors would you characterize as project management?