TEIO12. Maglev project. Extension of the Maglev Train Track between Shanghai and Huangzhou

Transcription

1 TEIO12 Maglev project Extension of the Maglev Train Track between Shanghai and Huangzhou Group12 Henning Autzen Michael Cramer Thomas Herzig Frauke Hummelt

2 Structure Appendix Introduction Executive summary Background, objective and goal... 4 Goal Requirement specification... 6 Triangle Product requirement Project requirement Prerequisites Handover Situational analysis and stakeholder SWOT Stakeholder mapping Milestones Activity list GANTT Organization and staffing Roles, responsibilities and authorities Staffing plan Budget Communication and quality assurance Reports and documents Communication plan Quality assurance Change management Risk analysis and response planning Quantitative Risk Analysis Others Project Planning References

3 Appendix APPENDIX 1: MILESTONES APPENDIX 2: ACTIVITY LIST APPENDIX 3: GANTT CHART APPENDIX 4: COMMUNICATION PLAN APPENDIX 5: QUANTITATIV RISK ANALYSIS Introduction This first introduction part is about why our group A2 has chosen this project for the assignment. The real project plan starts with chapter one and is consequently written from another perspective. The course TEIO12 Industrial Project Management is about industrial projects like the course description implies. From this point of view we changed our project from a bicycle tour to the following project: Extension of the Maglev train track between Shanghai and Huangzhou. Our group members are interested in high technology solutions as well as in the application of such technologies. As industrial engineers, we have the understanding about the technical issues without forgetting the costs and implementation part. The Maglev train is an ecological solution for public transportation and will of course shorten the travelling time dramatically. Due to this reasons, the technology will become even more interesting in the years to come. The project planning of a Maglev train is naturally also an ambitious infrastructure project, which is also interesting for us. One other aspect was also, that it is german technology and we are coming all from Germany. But the Maglev technology is not very successful in Germany. It is nice to see that at least other countries appreciate this high-tech train. We have chosen the location in the region of Shanghai, because China is already considering the extension of the existing Maglev track. The project becomes more realistic than by just choosing a location randomly. 1. Executive summary 3

4 The project plan defines how to achieve the goal of constructing a ready to operate Maglev train track between Shanghai and Huangzhou until The project plan considers at first the important aspect of establishing written goals for the project organization as well as limitations of the project. In order to define the handover for the project sponsors and other involved parties, different requirements like product and project requirements are formulated. The success of any project depends on the project organization. To understand the own strength and weaknesses, a situational analysis is done with the obligatory SWOT-analysis. To follow the direction of the established requirements and handovers, the interests of all different stakeholders are investigated. In the following part, the focus lays on the different milestones and activities that are essential to achieve the overall project goal. Tools like a Work Breakdown Structure (WBS) and a Gantt-chart are used to visualize deadlines and interdependencies. An important aspect before starting the project is the human resource management. Roles and responsibilities are clarified and a staffing plan is made. After staffing the project and considering the limitations, it is necessary to keep the budget if the project should be successful. All different cost and profit centers are investigated. A more people related part after the hard facts is the management of the project organization and the communication plan. To assure the required quality, several quality tools are considered and a risk analysis together with a response plan is carried out. To sum up, the success of the project will be guaranteed by a structured, realistic and sophisticated project plan. 2. Background, objective and goal More than 5 years have passed since the first commercial Maglev trail in Shanghai was inaugurated. The track connects Shanghai City with the 30km distant Pudong International Airport. The Maglev train is the fastest railroad connection operating on a regular basis. The construction was a project with high prestige for all involved organizations including the technology companies Siemens and ThyssenKrupp, the Chinese government and the Chinese railroad company. For the two companies (Siemens and ThyssenKrupp), the track was a demonstration showing that their high-technology train can be used on a daily basis. The two other partners gained prestige by owning and operating the fastest commercial train on the globe. The journey of the 30km between the two stations takes only 7minutes and 20 seconds maximum speed of 431km/h. Due to some reasons the Maglev train is operating at a loss. Too few passengers use the train because of high ticket prices (compared with other means of transport) and an insufficient connection to the public infrastructure. The Maglev high-speed train can exploit his excellent capabilities especially on longer tracks. Since the beginning, discussions were hold about an extension of the existing airport track. Now, the goal is defined: 4

5 Goal Goal of the project is to extend the existing Maglev railway track in China from Shanghai to Huangzhou. With project closure it will be possible for passengers to travel not only via the existing line from Shanghai to the Shanghai Airport, but also to have a non-stop connection from Shanghai to Huangzhou with a track that is mainly going through sparely populated areas. This should be achieved until 2014 and the project budget should not be exceeded. In advance an essential pre-study was used in order to clear the specifications and the relevance of the project. Also risks and possibilities are elaborated. During the pre-study phase, several possible solutions were considered, like for example a high-speed train between Shanghai and Huangzhou. A regular train connection would have been more economical from the cost perspective, but not as much as in other comparable situations due to the fact, that no high-speed train tracks are existing between the two cities. The time aspect is a big advantage for the Maglev train, because the travelling time will be reduced dramatically. Also the environmental aspect was advantageous for the Maglev train in a long term perspective due to a less energy consumptive technology. Two more considered advantages are on the one hand the connection to the already existing track in Shanghai and on the other hand the prestige of the worldwide first long distance Maglev train track. One goal is to increase the utilization of the existing Maglev train by connecting it better to the infrastructure and make it more attractive by covering a longer distance. The second point is the importance for the industrial partners of the project to promote their technology. The Maglev project is not supposed to replace the existing train track and flight route from Shanghai to Huangzhou. The Maglev is supposed to offer a faster, more regular, but also more expensive way to go between the two cities. The projects focus lies on the technological extension of the existing track. The project is not supposed to plan the operation the extended track or the maintenance of the Maglev track. The operation and the maintenance are projects on its own and have to be planned and executed by the Chinese transportation corporation. Also, the project is not supposed to transfer the entire technology to Chinese companies. Only the parts that are specified in the contract are transferred. The core competence stays with Siemens and ThyssenKrupp in Germany. During the project, no new high technology should be invented but rather the existing high technology should slightly be updated and then be used. No new research is to be initiated during the project, this would consume too much time and the project would be delayed and costs would increase strongly. The project organization itself will manage and coordinate the main activities during the project. But it is not the goal of the involved partners to implement all on their own. It is often of advantage to engage specialists for the execution of special tasks, considering the project quality and costs. The project organization will not acquire all knowledge on their own, but will instead corporate with other companies and delegate tasks to subcontractors. 5

6 3. Requirement specification Triangle Q: 50% R: 40% T: 10% Quality 50% Time 10% Resources 40% 3.1 Product requirement Product requirements are a prerequisite for a project and define the characteristics of the final product that is handed over. The time it takes for the Maglev to go from Shanghai to Huangzhou must be less than 40 minutes considering the average velocity of 250 km/h, the distance of 169 km and one station in between. The passenger transport must be reliable in meeting arrival and departure times. For the safety, the rail course must be protected from objects or persons that could cause accidents. In urban areas, shields are installed to protect people from entering a dangerous radius around the rail course. Furthermore, the Maglev train provides an environmentally friendly way to transport large passenger numbers. 3.2 Project requirement It is expected that the number of passengers on the existing track from Shanghai to Huangzhou is going to increase because of the longer distance that can be traveled by taking the Maglev and no other means of transport. Therefore, the product quality is most important for this project to satisfy customers and provide a positive image in the long term. This implies that many test runs and quality assurances have to be done which could extend the time frame. Because there is no specific date when the extension of the Maglev track has to be finished, the usage of resources is expected to be economical rather than executing the project in the shortest time possible. Therefore, the budget of 6046,4 Mio may not be exceeded. Furthermore, a non-disclosure agreement is set which ensures Siemens that its confidential core technology is not revealed. Yet, the Maglev technology is delivered as the final product to the Chinese transportation company. 6

7 3.3 Prerequisites As prerequisites for a successful project, contracts have to be fulfilled in time and in a way which satisfies the quality requirements. The financing must be reliable so that cash flows come constantly and at the right time to ensure the liquidity and also the progress of the project. To maintain a high level of motivation within the project group, all members sign a contract before the execution phase which states that everybody will continuously give their contribution to a successful project closure. This tool is rather providing a psychological effect than legal possibilities. 4. Handover Before the Maglev project can be handed over, it has to be implemented into the existing system. After the track, trains and new infrastructure are finished and each part is individually tested for proper quality and functioning, they have to be tested as a system under real working conditions. The project team acts as reference group during the tests. The reference group can by that way discover flaws in the new system and the integration into the existing infrastructure. The test runs also ensure that the future working personal is properly trained before the project is handed over. To see the final project result coming together, is an encouraging reward for the project team and helps them to see their part in the accomplished work. The ticket system exists for the already operating Maglev track, but the new data including the prices, new stops and time schedule has to be integrated into the database. The ticket system is also being tested by the reference group to ensure a smooth start from the beginning. The Handover to the client consists of an acceptance test of the final product. Therefore a committee consisting of members of the Chinese Government and the Chinese transportation Company is created to test the outcome. During the test, a full day operation is run to check whether the planned time table is feasible, the new system works as demanded and the integration into the existing track is working flawlessly. The administration of the new Maglev track is given over and integrated into the existing Maglev division of the Chinese transportation company. The final project plan that shows how the project was executed and the final change protocol are handed over to the Chinese Government and Chinese transportation company to close the handover. 7

8 5. Situational analysis and stakeholder 5.1 SWOT Strengths - Predictable technology - Efficient by using concurrent engineering - Mainly same involved partners as in the first Maglev project Opportunities - Sub-contractors are experts in their field - Publicity for the technology - Usage of the real power of the technology in long-distance-traffic - Subsidies because of the economical situation Weaknesses - Concurrent engineering: coordination & synchronization - Long distance between the different project locations - Cultural problem in an international project Threats - Losing control by giving tasks to subcontractors - Concurrent traffic project which influences negatively the commitment for the project - Risk of plagiarism - Image problems because of dispossession - Raw material prices Before launching a project, it is mandatory to analyse influencing factors in the current situation. Internal and external effects can cause difficulties as well as chances during the project execution. Seeking a successful project closure, the influencing forces must be identified and integrated into the project plan in order to avoid problems or to use opportunities. Therefore, a SWOT analysis is applied to map strengths and weaknesses inside the project or the organization as well as opportunities and threats from external factors. Due to the fact, that this project is the extension of an existing track, the stakeholders already got experience from a similar project. Therefore, coordination and communication should go smoothly. The predictability of the Maglev technology is also seen as a success factor. Nevertheless, geographical and cultural aspects can become weaknesses within the project organization. While concurrent engineering as the project model offers the chance to save time, it might cause difficulties in the coordination and synchronization of the simultaneously developed parts. On one hand, external risks such as rising raw material prices, plagiarism, or image problems due to dispossession can jeopardize the project success. Concurrent traffic projects which offer passengers another form to travel the same distance could deplete the motivation and commitment within the project group. On the other hand, the public is interested in this highly developed technology and subsidies are given because of the economical situation. Furthermore, the extension of the track renders it possible to use the main advantages of this technology, which lies in the long distance. Outsourcing parts of the project to subcontractors allows high quality expectations, but also lowers the ability to influence and control those processes. 8

9 As an advantage for the project, the technology is predictable and the subcontractors are experts in their field of profession, so that the end product will fulfill high quality characteristics. Losing control to subcontractors and facing coordination problems due to concurrent engineering as the project model, the project becomes vulnerable in a way that different parts will be incompatible. As a countermeasure, meetings are held to discuss progress and changes. Furthermore, the predictability of the technology and the experiences from the earlier Maglev project will strengthen the project coordination. 5.2 Stakeholder mapping Stakeholder Influencing Influenced Core Chinese government Chinese transportation company Siemens/Thyssen Krupp Primary Building contractors Chinese energy provider Residents along the track Secondary General public The above shown table depicts the different Stakeholders of the project. The core Stakeholders are the three parties directly influencing and controlling the project: The Chinese government as sponsor and client, the German consortium of Siemens and Thyssen Krupp which leads the project management and provides most of the technology and finally the Chinese transportation company which is going to operate the Maglev track after it is finished. This company is 100% owned by the Chinese state, so the two could be counted as one stakeholder. However the two can be distinguished by their scope: because the Chinese state is primarily interested in the large picture of the project and the impact it has on its surroundings and the economy, the operating company is counted as a separate stakeholder that is more into the details and profitability of the project. The primary stakeholders are the contractors who are going to build parts of the project but are not involved in making project decisions. Then there are two stakeholders that are directly influenced by the project and therefore also primary stakeholders: The Chinese energy provider which has to prepare its infrastructure for the increased energy demand by the Maglev track and the residents along the track whose land property and houses are dispossessed in return to compensation payments. Finally there is the general public which has to accept the usage of tax money for the project in return to the advantages for faster transportation that the Maglev provides. The following table provides a more detailed analysis of advantages and disadvantages for all stakeholders to understand and evaluate their expectations in the project. 9

10 Stakeholder Advantage Disadvantage General Public +diversified transportation: better quantity and quality makes traveling easier and more comfortable +faster transportation by Maglev makes travel faster -possibly less expensive transportation by other modes -tax money spent on high tech while majority in china can hardly effort normal train Chinese government Chinese transportation company Siemens/Thyssen Krupp +revenues from Maglev +economic growth +cleaner environment +less accidents +less clogging on other modes +prestige object +technology transfer +revenues from Maglev operation +revenues from project +Maglev technology more used(references) tickets -costs from Maglev -loss of revenue for other Governmental owned modes -complicated contracts -costs from Maglev -loss of revenue for other owned modes -technology transfer can lead to product copies -complicated contracts Building Contractors +revenues -costs Chinese energy provider +revenues due to high energy -investments in infrastructure consumption Residents along the track +possible compensation payments -noise disturbance -possible electromagnetic pollution -disturbance due to building work -land dispossession 5.3 Milestones The Milestone plan is attached in the appendix. Appendix 1: Milestones 5.4 Activity list The Activity list can be found as MS Excel file. Appendix 2: Activity list 5.5 GANTT The Gantt chart can be found in the MS Project file. Appendix 3: GANTT chart 10

11 6. Organization and staffing 6.1 Roles, responsibilities and authorities Clear roles and responsibilities are necessary in every project, but especially in such large project with duration over four years and many involved partners. It is difficult to establish authorities, because authority has to be developed. But persons like a project manager should have authority in order to manage the project. The roles in this project are assigned as following: Sponsor: Chinese government Steering committee: o o o Chinese government Project Manager (who delivers the reports) Core stakeholders Chinese government Minister for Economic Affairs Minister for Transportation Minister for Environment Secretary of state Chinese transportation company CEO CFO Project Manager: Project group: The Project Manager is assigned of the main industrial partner Siemens Involved people of the different parties o Siemens/ThyssenKrupp Project Manager Coordinator of communication with subcontractors Project Management/Administration 40 responsible engineers o Chinese government 5 local responsible Land survey administration o Chinese transportation company (Construction of the track) 2 responsible for the construction of the station (coordination, surveillance) 10 responsible for the track 11

12 Responsibilities Additional to the explained roles in the preceding chapter, responsibilities for the most important tasks are defined. The Chinese transportation company is responsible for the course of the track, the construction process and the construction process of the different stations. Of course, subcontractors are engaged to fulfill the concrete task, but the company coordinates the processes. The two industrial companies, Siemens and ThyssenKrupp, are responsible for the trains, the actuation technique, the energy supply, the control and communication system and for all technical issues during the project. The Chinese government got the role of the sponsor and is represented in the Steering committee. The sponsor defines the most important requirements of the project and will be informed over the project progress regularly. 6.2 Staffing plan Resources for the staffing plan are assigned mainly from Siemens, ThyssenKrupp and the Chinese transportation company. Engineers employed by Siemens and ThyssenKrupp are experts for technological issues and responsible for specific subtasks within the project. In case of responsibility for tasks which are outsourced, the engineers have to set up requirements, select the subcontractor, and monitor the process. Furthermore, they control that the non-disclosure agreement is not broken. Besides being in charge for the successful completion of their specific subtask, the engineers coordinate information about decisions, changes, and reportable events within the project group. The Chinese transportation company has members within the project group to ensure that the progress of the project and changes are consistent with their expectations as the future operator. Within the project group, one person is always in charge for the cooperation and communication with a specific subcontractor. This person in charge has advanced knowledge about the task the subcontractor is responsible for. In this way, the cooperation with the subcontractor is expected to go smoothly. If it is necessary, one representative from each subcontractor can attend important project meetings in order to be informed about the current status or to solve a problematic task. 12

13 7. Budget The overall budget consists of internal costs, external costs, other costs and the financing. Under the respective topic, the different cost terms are further explained. All cost terms in the project are in Euro. Internal costs Staffing In the project group work almost only engineers with different engineer backgrounds. Most of them will work during the whole project duration in the project organization. Additionally, costs for nonpermanent project members will arise. It is calculated with 40 Million personal costs. Office The project group rents office rooms in Shanghai for the whole project phase. The rooms are equipped with usual office staff and notebooks for the project members. There will not be fixed offices for each project members, because they will work most often outside the office. Furthermore, one meeting room is available. Costs over Euros are assumed for the project office and its equipment. Administration costs Due to the internationality of the project with companies in Europe and Asia and the extension over almost 200km between the two cities voyage costs with Euros are assumed as well as staying costs for non-permanent staff over Euros are assumed. External costs The term external costs consists of costs for the construction of the track, costs for the Maglev trains and costs for the construction respectively reconstruction of the stations at the rail course. The costs of the project are calculated by comparing costs of similar project with the actual project. The Maglev project between Shanghai Airport and Shanghai City is used as reference as well as other studies to possible Maglev tracks in Germany, the United Arabic Emirates and in China. These references were studied due to their relevance to the project. The costs for the trains were also calculated by paying attention to the size of comparable Maglev trains. These costs are mainly compared to the feasibility study of the Munich Maglev project. Station costs were compared with construction of other famous stations, which were built during the last years for example in Peking and Berlin. 13

14 Track costs These costs are calculated per kilometer of the course. The overall distance between Shanghai and Huangzhou is 169km. The track passes the cities of Shanghai, Jiaxing and Huangzhou. In between, the track course is planned to avoid proximity to other cities. Obviously, the requirements for a track in a city are almost completely different to those of a track in sparsely populated regions. The security standards are higher in the city and special arrangements for noise protection have to be made. This results in different costs per kilometer: Costs per kilometer in cities: Costs per kilometer sparsely populated regions: 47 Million per kilometer 24 Million per kilometer The cost calculation anticipate 25km in the city of Shanghai, 15km in the smaller city of Jiaxing (but the track hast to go completely through it) and 20km at the final destination in Hangzhou. All together, 60km of the 169km are anticipated to be more expensive than the others. This results in the following costs: Costs in cities: 60km x 47 Million per kilometer = Billion Costs outside cities: 109km x 24 Million per kilometer = Billion All costs are corresponded to a double lane kilometer. Train costs Even if the travelling time will be around 40 minutes, the track belongs into the category of longdistance traffic. The existing Maglev train operates according to a time schedule with six trains in an hour. On the long distance between Shanghai and Huangzhou the train is going to operate according to a time schedule with one departure every hour. The consortium orders three trains with a capacity for more than 400 passengers each. This results in costs of 150 Million. Station costs The Maglev requires special stations and cannot automatically use normal railroad stations. To achieve economies of scale and in order to connect the Maglev in an ideal way to the rest of the public transportation system, it is beneficial to expand the already existing railroad stations to Maglev compatibility. Station in Shanghai The existing Maglev station will be expanded in order to allow departures to Hangzhou as well as the perpetuation of the already operating traffic. This reconstruction is required because the two connections will be operated completely independent. Cost for the reconstruction: 80 Million Station in Jiaxing Considering the existing infrastructure in Jiaxing the conclusion to build a completely new station was drawn. The new station will be a Maglev station with perfect connection to the other infrastructure and public transportation systems like regional trains and buses. The construction of a completely new station with halls and buildings around is calculated with 220 Million. 14

15 Station in Huangzhou Hangzhou has already a modern railroad station. By the pursuit of the goal of a perfect link to the transportation system, the station will only be reconstructed for the Maglev. Costs of 120 Million will arise. Financing The project is financed by the project sponsor, the Chinese government. They stand for all expenses during the planning and implementation phase. Within the operation phase, the operator which is the Chinese transportation company can sign a contract with the former sponsor in order to distribute the income until the sponsor s expenses are refinanced. Budget costs in million Euro Internal costs staffing 40 office 0.16 administration 0.24 External costs track costs in cities 2820 sparsely populated regions 2616 train costs 3 trains 150 station costs Shanghai 80 Jiaxing 220 Huangzhou 120 Overall costs Communication and quality assurance 8.1 Reports and documents The project team members hand in reports regularly in order to inform the project manager about the current status of progress and performance. On this way, the project manager over gives information and reports with aggregated data about the overall project activity, time and resource consumption, results and deviations to the steering committee. A proper registration of each report 15

16 assists to cope with the large amount of documents during the execution phase. In addition to the regular reports, problems and special situations such as delays or strikes have to be reported immediately to the project manager. If these obstacles occur in activities that belong to the critical path, special attention must be paid. Nevertheless, time is less critical than the resource utilization in this project according to the project management triangle. Project meetings in form of information, work, decision, negotiation or evaluation meetings are held every Monday with the entire project group. Beside these meetings, additional meetings for urgent issues can be held at short notice in order to keep pace with the time plan. Steering committee meetings are also held regularly, but less often. They are imperative for far-reaching decisions and at tollgates. The project office is located in Shanghai and gathers knowledge, information and people at the same place in order to exchange information easily, decide quickly, and create a team feeling. As an assistance for the project office, an intranet is established which is used to transmit information when team members are at other locations and to retain project documents. Frequently, the SPI is calculated and reported to the project group. The SPI performance is important in order to finish the project on time. Simultaneously the CPI is reported as well. According to the constraints of the project, the costs are the second most important constraint. Regular performance measurements are necessary for the quality of the project and the successful progress of the project. 8.2 Communication plan The communication plan is illustrated in the following table. The table illustrates who reports to whom and when special communication events (e.g. tollgates) are established. Of importance is also the routine of communication. Some reports for the project group has to be communicated continuously, other reports for the steering committee only when a need or when special events (like Tollgates) occur. Appendix 4: Communication plan 8.3 Quality assurance Quality assurance is a part of Project Quality Management. It is therefore important that also the other parts like quality planning and quality audit have a high priority and are working well. In order to achieve high quality in an organization, some quality tools have to be implemented. In a first step commitment has to be created in the organization to give the further processes the needed support. 16

17 In the Maglev project, quality has the highest importance concerning the triple constraints. Continuous improvement has to be followed, because only small resting phases are allowed if higher quality levels are achieved. The two big companies, ThyssenKrupp and Siemens, are using Total Quality Management (TQM) and continuous improvement is one of the several tools of TQM. TQM is also used in the project organization. Another famous and powerful tool is the PDCA-Cycle which stands for Plan-Do-Check-Act. This will help all involved parties in the later phase of the project or even in new projects. One important statement is that quality does not cost only poor quality costs. The project organization has also one important advantage. The industrial partners are ISO9000 certified. Attention is paid to the selection of subcontractors. They can get only partners of they have implemented the ISO standards and if they are using TQM. In the specific production processes Statistical Process Control (SPC) is another tool which helps to increase the quality level. SPC-Tools are only considered for the production or manufacturing of specific parts and not for the project as whole. Attention should be paid to have processes under statistical control by using these tools (histogram, control charts, stratification, Pareto-chart,...). But the whole project is not a process and cannot be observed by these tools even if it is absolutely necessary to use them in the concrete production processes. During the pre-study Ishikawa diagrams are used. They are also important in the quality assurance meetings to detect main problems. Project Risk Assessment and Project Quality Assessment deliver the Project Management Maturity. By lowering risk values or increasing project management maturity better results are achieved. Regular quality meetings are important for the success. If there will be any sign of poor quality, quality circles with the involved parties will be introduced to solve the root cause immediately. All in all, the quality managers are not isolated in their work; every project employee is working for the overall goal of high quality. 8.4 Change management The Project documents are stored in a central depository in order to avoid single documents being saved on local computers without informing others about the changes. This server has to provide proper document version controlling in order to keep track of changes and versioning. In case of occurring change requests, the changes have to be analyzed in aspect of their impact on time, resources and quality. Depending on how severe the impact on the three dimensions is, these changes are handled by different roles in the project hierarchy. If the changes are of minimal impact (not affecting the project goal, the budget or the project time), the project manager can take the decision by himself. Otherwise, changes are decided upon by the steering committee. Additionally there is a change control board formed out of technical experts and experienced project members 17

18 who help to evaluate and asses the risks and impacts of changes. This advisory function for project manager and steering committee is necessary because most members of the steering committee (especially the Chinese government) have insufficient knowledge of all the details of the Maglev technology. All changes are to be tracked in a centralized change protocol. There has to be a regular report of all performed changes by the project manager to the steering committee. 9. Risk analysis and response planning Quantitative Risk Analysis In a high technology array project always several risks have to be handled. During the long duration different risks have to be considered. In the following part the risks of the table are explained and a suitable risk response strategy is presented. Appendix 5: Quantitative Risk Analysis Claiming residents: There is a high probability of claiming residents. During pre-study and earlier similar projects have been some public demonstrations even in China. This can delay the project and occupies resources during long processes at court. One response is an adjusted rail course to avoid, that the track goes through resident areas in the cities. An alternative response is noise protection around the track. Misuse of technology: Unfortunately plagiarism is widely spread in China. This is a threat for hightechnology companies and projects. The risk response is a non-disclosure agreement. Soil quality: There is a risk that the soil quality is not adequate for the Maglev track. Later changes in the track course would increase costs or complex solutions will be necessary which also increases costs. Therefore extended and detailed soil analyses are made before the construction will be started and several high-technology solutions are available. Rising prices for raw materials: In 2009, raw material prices are on a very low level due to the international financial crisis. Increasing prices has to be considered since international economy will recover sooner or later. For the project, contracts with suppliers guarantee the 2009 price of raw materials or only a little bit higher prices during the whole project duration. Financial contracts like forwards are also used. Delay in delivery of raw materials: Only reliable suppliers and sub-contractors are becoming partners. So risk of shortages of raw materials is minimized. 18

19 Ground acquisition: In infrastructure projects, ground has to be purchased. Before the execution phase of the project will start, all negotiations with the land owners are terminated and the needed land will be acquired. This is guaranteed by early negotiations and compensation for the owners. Technical difficulties in rail course: Even if there is already existing one Maglev track in Shanghai, technical problems can maybe occur in this project. To handle this risk, high skilled project members are engaged. The risk is also minimized by detailed planning and simulations as well as for its costeffective. Delay due to difficulties in contract negotiations: In this large project, a lot of sub-contractors are engaged because they are experts in executing these special required tasks. Of course, individual contracts are set up with each contractor to specify the task and the payment. Delays in the negotiations are avoided by engaging well-known sub-contractors of the first Maglev project and other reliable companies which are known for good supplier relationships. Corruption: Chinas rank on the international corruption index is not the best. Also large industrial projects are said to be especially susceptible for corruption. The project organizations corporate governance is organized in order to avoid corruption. Also transparency plays an important role and even an internal anti-corruption team is engaged. Communication problems due to internationality: Communication between people of different countries is never as easy as between people of the same country. The differences vary especially between the western attitude and the attitude in China. One response to avoid poor communication is the inclusion of several project members who have been involved in the first Maglev project in Shanghai and other high skilled stuff which is employed to work in international teams. 10. Others Project Planning The concurrent engineering approach is used as project model for the overall project. The extension of the Maglev project is mainly divided in three independent tasks: The track, stations and the train. Also other activities can be started and implemented in a parallel way. The main risk by implementing concurrent engineering is the synchronizing after the tasks are finished. This risk is mitigated or even avoided by only considering the track, the stations and the trains as parallel tasks. There does not exist a software/hardware conflict which causes often problems in the final synchronization. The main advantage of concurrent engineering in this project is the reduced duration. Independent activities are completed at the same time which shortens the project make span. Due to the size of the project and due to the fact that some tasks could even regarded as own small projects, not only one project model is used. After breaking down the activities in the three mentioned main tasks, these are dealt with by using sequential development or the so called waterfall model. On the lower levels the main focus is put on quality aspects and risky methods 19

20 are avoided. This method guarantees an excellent quality while the time aspect is held on the top level by using the concurrent engineering. There will not be any difficulties in the coordination of sub-projects with different planning models, because it would not be possible to carry out such a large high-technology array project at once. 11. References World Wide Web: Literature: Bo Tonnquist, Project Management, Bonniers 2008 Stefano Tonchia, Industrial Project Management: Planning, Desing, and Consutrction, Springer, 2008 Croenenbroeck, Wolfgang: Internationales Projektmanagement. Cornelson, 2004, ISBN Hobbs, Peter: Professionelles Projektmanagement. Moderne Verlagsgesellschaft, 2002, ISBN Willie Tan von Taylor & Francis Ltd, Principles of Project Infrastructure Finance,