Assignment 1: Circored Project

Assignment 1: Circored Project

The Circored Project

The project was founded by two companies namely Cleveland Cliff (majored in iron ore mining) and Lurgi Metallurgie GmbH that majored in the production of pure Iron from iron ores through a new technology that Lurgi had developed. The iron was to be produced by converting it to hot briquette form and then the ore was reduced to pure iron through pressurized hydrogen gas that was heated. According to Kerzner (2013), the project was a success at first as the team had a well-planned strategy with an effective team. The reason for the merger of the companies and utilization of the new technology was because it would increase cost efficiency by 10% and bring significant change in overall reduction in costs entering into a new product market in Trinidad. Unfortunately, due to unforeseen uncertainties or rather risks, the project started experiencing frequent problems. When one problem was solved, another one rose. To their surprise, the foreseen risks did not even occur, new risks and challenges cropped up instead, and since they were unprepared, the two partners had to waiver for some time until they came with better strategies (Loch, Meyer & Pich, 2006).

Project Management

It is true to say that Cleveland-Cliff and Lurgi had very well planned the project, well-experienced team and even a well-tested Fluid Bed Process to produce the new product. They only neglected some aspect of project management that made them go through a lot of costs and time wastage up to a point where the project was almost collapsing (Loch, Meyer & Pich, 2006).

They forgot about the unforeseeable risks and uncertainties. The new challenges came as a result of the complexity of the project as it involved a joint venture among three countries. Secondly, the new technology, even though tested by a lab, had technologically unforeseen uncertainties that they ignored which brought consequent complexities. It was hard to make the project work since they solely depended on it. It simply lacked flexibility (Collins, 2011). There was also a failure in management as the team failed to avail options in case the project failed, but they just assumed that the events would go as planned. They relied more on planning and execution rather than an assessment of both foreseeable and unforeseeable uncertainties (Kerzner, 2013).

There was a need for flexible approaches so that the team could have more problem-solving capabilities and resources. The most important aspects of project management include the identification of risks, prioritization of the risks and finally the best way to manage both the foreseeable and unforeseen risks (Loch, Meyer & Pich, 2006). Planning without risk management could lead to project failure or even diversion of the idea from the original one. In this case, the team had a poor management team; they lacked flexible strategies to fall back on; they were faced with unforeseen technical uncertainties and most important of all; they did not exhaust all the risks in their list. They concentrated in only the foreseeable risks of which the project did not even face, meaning that the management was very poor in risk assessment. It was not until Lurgi revisited his technology that the project went back on track. They had to change the management team, and it bore fruits (Kerzner, 2013).

Recommendations

For a project to be successful, the management team has to first of all, in their planning period, understand and classify any form of risk-cause that will and may face the project. The complexity of the project had to be eased and understood too. This is achieved by availing a variety of options through numerous project tests and approaches so that in case the most viable strategy fails; the team can have a flexible plan to fall back to (Collins, 2011). Both foreseeable and unforeseeable influences to the project have to be exhausted. Such influences as interests of stakeholders, trends in the new market, technical variable and competition forces have to be well understood. Also, a variety of complementary project approaches has to be generated to choose the outcome of the most viable (Collins, 2011).

Conclusion

Project management requires a thorough exhaustion of risk assessments whether foreseen or unforeseen. Risk management is an important ingredient of planning and execution of a project. The success of a project is determined by the ability of the team to assess uncertainties in all influences to the project both foreseeable and unforeseeable (Kerzner, 2013).

References

Collins, R. J. (2011). Project management. New York: Nova Science Publishers.

Kerzner, H. (2013). Project management: A systems approach to planning, scheduling, and controlling. New York: John Wiley.

Loch, C., Meyer, A, & Pich, M. T. (2006). Managing the unknown: A new approach to managing high uncertainty and risk in projects. Hoboken, NJ: John Wiley.