Analyzing cost and time overrun in Sydney Opera House Failed Project

Running head: PROJECT MANAGEMENT
Analyzing cost and time overrun in Sydney Opera House Failed Project
Name of the Student:
Name of the University:

1PROJECT MANAGEMENT
Table of Contents
1. Introduction..................................................................................................................................2
2. Range of used control system for cost, schedule, scope and quality...........................................2
3. Analysis of reasons explain the cost and time overrun encountered during the project..............5
4. Analysis of the extent to which the project execution team could be held responsible of the
incurred time andcost overruns........................................................................................................7
5. Analysis of the relationship between the problems...................................................................10
6. Analysis of the project management actions that could have been taken to better control the
project and stakeholders in order to increase the chance for successful delivery..........................12
7. Conclusion.................................................................................................................................13
8. Recommendations for project success.......................................................................................14
References......................................................................................................................................16

2PROJECT MANAGEMENT
1. Introduction
Sydney Australia’s iconic opera house is a study in the failure project of Australia. The
original plan of the project is in four year timetable and it has a budget of AU$7 million budget.
At the end the project took AU$102 million with 14 years to be completed. The construction of
this project is not managed properly, therefore it is considered as one of the failed project. The
project is failed as it was not followed the processes signify the project management along with
accounting processes. The main focus behind this project is to design future National Opera
House which can showcase creative as well as technical abilities of Australia (Sydney Opera
House Failed Project 2017). This project is mainly failed due to cost and time overrun.
This project report analyzes the ranges used to control system for cost, schedule, scope
and quality. It also analyzes the cost and time overrun which are identified during the project,
extents to which the team of project execution can be responsible for issues related to cost and
time overrun. All the project related factors of cost and time overrun issues are related with each
other. The actions related to project management are analysed for better control of the project
plan so that the project can get success. The project stakeholders are responsible for delivering
the project on time to the project manager.
2. Range of used control system for cost, schedule, scope and quality
The project controls are termed as gathering of project data, administration of data and
analytical actions used to compute in addition to control time as well as cost outcomes for the
project work. Through proper communication of information it can assist to effective decision

3PROJECT MANAGEMENT
making related to the construction work. In the Sydney Opera House Project, cost control system
is required to identify and lessen the business expenses for increasing profits and starting with
the budget processes (Sydney Opera House Failed Project 2017). The project owner compares
the project’s actual budget with the budgeted expectations. The actual project cost is higher than
planned budget, therefore the management takes proper steps to control entire project cost
(Kerznerand Kerzner 2017). Cost control is a key significant factor to maintain and grow the
project profitability. Outsourcing is needed to control the project cost as the project can find
cheaper way to perform the project tasks.The construction company can calculate net pay as well
as tax withholdings for the workers that can save time plus expenses of workplace employer.
The first step to establish this construction project work is estimation of how long the
project activities will take from time it starts and finishes. The total duration of this project
activity is time for project work done plus it is associated with waiting time (Flemingand
Koppelman 2016). The activity duration estimation is based on quality of the project resources
expected to use on the project activities. Over the project lifecycle, it is involved with activities
which can source delay and hastening tends to reject one another. The schedule project control
leads to measure the project progress and compare to plan progress on timely and daily basis.
The schedule control processes is involved to gather data on performance of project and compare
with planned schedule performance (Harrisonand Lock 2017). A daily reporting period is
established to compare progress with estimated project progress. Reporting of construction work
is done on weekly and monthly basis based on project complexity and duration of work.
The project work requires managing scope so that the project can able to meet with its
project goals. As the construction of Opera House is not able to meet with its time and scope,
therefore scope is required to control. Scope control is required monitoring and controlling entire

4PROJECT MANAGEMENT
process group so that the work is controlled on time (Nicholasand Steyn 2017). For the
construction project, the scope is that surface is prepared for building, foundations require lying
and control system requires expanding before building work is started. The project becomes
complicated as it requires various things to be considered. The contractor is required to map
building site such that the suppliers and builders can know the part of project (Kerzner 2018). It
can map with corresponds with the project scope. It is responsibility of general contractor to
determine jobs require performing. A detailed plan is created with information so that the
contractor can control project scope (Binder 2016). As the project leader and contractor will get
formal approval from the stakeholders, and then well defined project tasks and requirements are
used to work as per project goals. Possible project changes are forecasted based on project
requirements as it can change the project scope and cause delay in time to complete the project
work.
The control system for quality is required to maintain a better quality of the construction
materials. The professionals of project controls are not concerned in direct management of
project work and management of quality (Verzuh 2015). Quality inspections are the works which
are undertaken by the project team members to finish entire project scope. There are
consequences to get quality materials and administer contractors for monitoring the project
outcomes.Mainly, the quality control system is required to focus on meeting with project’s
requirements (Loveet al. 2015). Quality assurance is focused to provide confidences that quality
needs are to be fulfilled. In the construction project of Opera House, the control system
evaluates, inspects and tests the product to detect if it can fulfill client’s needs, if the project is
free of defects and conform to the project specifications. Quality control system identifies the
defects after the product is formed. The project manager provides quality assurance for this

5PROJECT MANAGEMENT
project when the product can meet with quality and compliance needs (Adam, Josephsonand
Lindahl 2015). Quality assures for successful completion of the project work focused on time
and cost.
3. Analysis of reasons for cost and time overrun encountered throughout the
project
The construction work of Sydney Australia’s Opera House Project is one of the key
significant sector of the construction industry in Australia, faces significant overrun of cost as
well as time. Both of those overrun cause delay in the entire project work. The purpose of this
section is to study how cost as well as time overrun in the construction projects is based on
forecasted cost, predicted time plus nature of the project (Miranda Sarmentoand Renneboog
2017). Following are the reasons behind cost and time overrun during the project such as:
Poor planning: Improper planning is considered as detrimental effects on the time and
cost presentation of the construction project of Opera House. There is no resource scheduling in
the project which leads to delay in entire project development stages. Improper planning of entire
project work is lead to cost overrun and delay in project with longer duration and high project
budget (Rahman, Ismailand Jaber 2018).The project is launched with no such finalized plans;
however the project client changed floor planning from two theaters to four after staring of
construction work. Each of different management team members have distinguished project
goals and taken different decisions from others.
Financial problems: The construction project is not receiving proper budget as per
planned, therefore it faces cost overrun. Proper budget is not allocated to each project activities
based on the project requirements (Ali 2018). There are no management as well as accounting