Cost Management and Triple Constraints in Aviation Industry

The provided assignment content discusses the importance of managing costs in a project to facilitate variety of customers by providing all services to an entity. It highlights the three components of the triple constraint triangle: cost, quality, and time, which are interrelated. The text also explains methodologies and processes used for project management, such as Gantt charts and network diagrams, and concludes that the success of a project is dependent on various factors including risks faced by the entity.

Heathrow Terminal 5 project

TABLE OF CONTENTS
1.1 PROJECT ASSUMPTIONS......................................................................................................3
Overview of the project..........................................................................................................3
Stakeholders...........................................................................................................................3
1.2 PROJECT BUDGET INFORMATION....................................................................................3
1.3 PROJECT OBJECTIVES..........................................................................................................4
1.4 PROJECT APPROACH............................................................................................................4
Time management..................................................................................................................4
Risk management...................................................................................................................4
Team.......................................................................................................................................5
Cost management...................................................................................................................5
Triple constraint Triangle.......................................................................................................6
Methodologies and process....................................................................................................6
Success / failure......................................................................................................................6
REFERENCES................................................................................................................................8

1.1 PROJECT ASSUMPTIONS
Overview of the project
Heathrow terminal 5 may be served as terminal which is situated at such airport.
Construction of such project started in the year of 2002 and completed in 2008. The main aim of
project such as terminal 5 is to handle 35 million passengers in a year. From assessment, it has
been identified that in the year of 2015 Heathrow airport offered services to 33.1 million
passengers on 215716 flights. It was one of the busiest terminals of London in terms of both
number of passengers and flights. Cost of the concerned project is £4.2 billion and it took 6
years for the completion of project (Davies and Mackenzie, 2014).
Stakeholders
Stakeholders are the one who are highly interested towards the completion of specific
project. In the context of Heathrow Terminal 5 project local and international people, financiers
and government. All such are the main stakeholders who are highly associated with the project
of Heathrow Terminal 5. Stakeholders who are identified above are highly important because
financiers are the one offers monetary support. Besides this, support from local people and
government authority is highly required to accomplish the project successfully. By offering
employment opportunities at the time of construction and after the completion of project
Terminal 5 stakeholder’s expectations such as local as well as international people were met
(Leach, 2014).
1.2 PROJECT BUDGET INFORMATION
From assessment, it has been identified that £4.3 billion invested by British Airport
authority for the project of Heathrow terminal 5. Such cost includes several expenses such as
salaries and wages of individuals, electricity and other miscellaneous expenses.

1.3 PROJECT OBJECTIVES
There are several objectives which are associated with the project Heathrow terminal 5 as
follows:
 To enhance the capacity of passengers flying per annum by 30 million.
 To provide individuals with all the modern facilities that meet environmental
standards.
 To build a state of the art control tower this in turn helps in meeting the demand of
air traffic.
 To improve the infrastructure and facilities that offer high level of satisfaction
among the individual.
 To make contribution in the economic growth and development by offering better
facilities to individuals.
1.4 PROJECT APPROACH
Time management
In order to manage time, project manager of Heathrow Terminal 5 prepared Gantt chart.
This is one of the most effectual tools which shoe the manner in which project activities are
highly interrelated with each other.
Risk management
In order to manage risk specific register prepared by the manager in following way:
Risk Risk score (0 to 4)
0 = Highly lower risk
1 = Lower risk
2 = Moderate
3 = High risk
4 = Very high
Risk response
Share price 2
Time 2 By preparing specific timeline
such risk can be mitigated.
Cost 3 Manager avoided the risk of

cost by developing highly
effectual budgeting
framework.
Quality 1 TQM technique employed by
the manager to improve the
level of quality.
Performance 2 By setting benchmark and
assessing performance in
against to it significant action
undertaken for the purpose of
improvement.
Scope 1
Client satisfaction 2 To maintain high level of
satisfaction manager made
changes in out
Compliance risk 3 -
Low accident rate 3 -
Financial returns or
profitability
3 -
Team
The success of a project is depends on the overall support of all the team members an
ingenuity get in order to accomplish all the desired aims and the objectives within a given period.
Various team members play a significant role in completing a single project which includes
involvement of aviation manager who allocates various tasks and duties among all the members
in improving the performance and current progress status of a project. Departmental system will
b followed in the given project in which accomplishment of all the task of a singular project will
in return increases the overall efficiency of complete project and enhances the quality of service
(Mir and Pinnington, 2014).
Cost management
Cost is regraded as one of the important concept for the aviation management department
of Heath row terminal who intends to reduce all kinds of existing costs incurred in an entity.
Various costs incurred in the business needs to be ascertained first and then reduces all the costs
that includes fixed and variable costs incurred in this project. Project costs can be managed by
prioritizing all the costs incurred in the building of this particular project in order to facilitate
variety of customers by providing all the services to an entity by decreasing current costs

incurred in the project. Management of costs can be done by preparing budgets as in this
particular way an entity will analyses all the current financial resources available with an entity
in order to predict the future costs to be incurred in the business as this help an entity owner in
order to grab higher market advantage in the external business environment in front of all other
competitor of an entity located in the similar industry (Turner, 2016).
Triple constraint Triangle
This is regarded as the trilogy which considers the three important components that increases the
overall scope of an entity in order to grab higher market advantages by delivering right amount
of services to all the external customers of an entity located in the external business environment.
Cost- Cost of all the services will be determined by an entity in advance that helps in catering all
he needs and higher expectations of an entity within a give period.
Quality- This aviation industry is regarded as most important industry which is renowned for
offering quality oriented services to all the customers of an entity. It can be said that cost and
quality is interrelated as increasing cost of product will provide higher quality services to an
individual.
Time- This is regarded as the final link to the overall chain in which tie of a particular product
will determine the final outcome as providing immediate flights to an individual will attract
variety of customers in the external environment.
Methodologies and process
Project management tool used by an entity in order to determine the overall duration of a
particular project by stating all the business activities lg with their specific time period (Stagnaro
and Piotrowski, 2014). Gantt chart will be used to schedule all the activities in chronological
order and network diagram depicts the actual time in which overall business project in order to
facilitate various kind of customers located in the external business environment.
Success / failure
After analyzing the performance of above project it can be state that this particular
project will succeed as the current risks faced by this kind of project is less and along with that
support of all the stakeholders will facilitate an entity in order to generate higher amount of sales

and the revenue in the near future. The pressure if risks faced by an entity are less which in turn
increases the overall chances of succeeding the current project report in the best possible manner.

REFERENCES
Davies, A. and Mackenzie, I., 2014. Project complexity and systems integration: Constructing
the London 2012 Olympics and Paralympics Games. International journal of project
management. 32(5). pp. 773-790.
Leach, L. P., 2014. Critical chain project management. Artech House.
Mir, F. A. and Pinnington, A. H., 2014. Exploring the value of project management: linking
project management performance and project success. International Journal of Project
Management. 32(2). pp. 202-217.
Stagnaro, C. and Piotrowski, C., 2014. Shared leadership: A critical component in IT project
management. Journal of Technology Research. 5. pp. 1.
Turner, R., 2016. Gower handbook of project management. Routledge.