BUSM4611: A Detailed Project Appraisal Report on Blue Spider

This report offers a comprehensive appraisal of the Blue Spider project, focusing on critical aspects of project management such as ethical considerations, risk handling, stakeholder communication, and the suitability of the project manager. It delves into the ethical dilemmas faced during different project phases, particularly concerning false statements and technical specifications. The report also examines risk management strategies employed throughout the project lifecycle, highlighting challenges like budget constraints and material sourcing. Furthermore, it analyzes communication breakdowns among stakeholders and evaluates the selection of the project manager, Gary Anderson, noting his technical expertise but shortcomings in managerial skills. The report addresses the resulting mistrust between the customer and contractor, influenced by the choice of a Firm Fixed Price (FFP) contract and concludes with key lessons learned and recommendations for improved project management practices, emphasizing the importance of transparent communication and ethical conduct.

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Project Appraisal Report: The Case of Blue Spider Project

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Executive Summary
The current report is based on the evaluation of the Blue Spider Project. The focus is to
understand the importance about various essential elements in project management like price
contracts, handling project team, ethics, manager selection, stakeholder communication, and
so on. The Blue Spider was a project on Research & Development (R&D) which aimed to
make the Spartan missile better by enhancing the structural capabilities of the missile. One of
the most important lessons learnt from the Blue Spider project is regarding the need for
establishing transparent and efficient communication process in the project management, so
as to ensure trust of the stakeholders.

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Table of Contents
Introduction................................................................................................................................4
Ethical Issues in Different Phases of the Project........................................................................4
Handle Risks at Different Phases of Project Life Cycle............................................................5
Stakeholders and Communication Management Issues with the Major Stakeholders..............6
Suitability of the Selection of Project Manager.........................................................................7
Situation of Mistrust Between the Customer and the Contractor..............................................7
Choice of Firm Fixed Price (FFP) Contract...............................................................................8
Evaluation of Project Management............................................................................................9
Lessons Learned and Recommendations.................................................................................11
References................................................................................................................................13

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Introduction
In the modern era of faced passed digital industrialization, every activity, be it business or
personal, can be found to represent a group or array or tasks to be performed with some
proper planning and consideration, with most of them requiring involvement of multiple
heads. Therefore, managing the entire function or activity has led to the emergence of project
management techniques which are essential to be followed to ensure successful completion of
the project or activities. Besides ensuring overall success, project management ensures
managing the resources and associated aspects to make sure the project is completed within
anticipated time, plan and budget, along with defining the roles and responsibilities of the
members associated with the project. For a better evaluation of the importance of various
project elements a case study of a critical project, referred to as the Blue Spider program has
been presented. The purpose of this assignment is to understand the importance about various
essential elements in project management like price contracts, handling project team, ethics,
manager selection, stakeholder communication, and so on.
Ethical Issues in Different Phases of the Project
The main objective of any business organization is to earn profits. In order to sell the
products or services or win proposals, many situations arise before the organization, when the
decision makers become unethical in their decisions and further actions. In case of the Blue
Spider Project of Parks Corporation there were some unethical actions undertaken by the
management of the organization. The Blue Spider was a project on Research & Development
(R&D) which aimed to make the Spartan missile better by enhancing the structural
capabilities of the missile. The Parks Corporation was inclined to win this project. The basic
incentive to win the project was that it would help the organization to get a program of $500
million spread over two decades. In order to win this proposal, the management of the Parks
Corporation, mainly Henry Gable, decided to be unethical. Their reputation was at stake and

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they even made false statements about their technical specifications. With the greed of
winning the project bid and for entering into the business, they took the help of forgery and
deception. Finally, with the falsification of facts and specifications, Parks Corporation
managed to win the Blue Spider Project bid. Business has some ethics which were broken by
the organization for monetary gains. Gary Anderson, the project manager had to be unethical
while hiding the true information from the customers and clients. According to Trevino and
Nelson, (2016) the business organizations need to keep their social responsibility in mind
while operating in any society as their unethical steps could incur huge social costs.
Handle Risks at Different Phases of Project Life Cycle
The Project Life Cycle has many phases associated to it. The life cycle of a project starts with
the project conception and its initiation (Team, F.M.E., 2014). This concept has to be
approved by the management for moving to the further phases. The next stage involves
defining the project and making the required plans for the same. It is very important to define
the project because the project manager and the team members must all have clarity about the
project and its objectives. The third phase in the project life cycle is the most significant
stage. In this phase the main project is launched. The execution of the project takes place in
this phase. While the project is being executed, there is need for monitoring the project
performance and controlling the various issues arising during its execution. This mainly takes
place in the fourth phase of the project life cycle. Finally the project ends with the reporting
about the project. There are many risks involved in any project like technical risk, executive
support risk, financial risk, market risk, risk of cultural integration, etc. In the Blue Spider
Project, the risks were like the failure in catering to customer needs, the project execution
required subsequent expansion of budget, extra work time was required, budget falls short at
the end of the project life cycle, finding a fresh material, etc. The project manager, Gary who
tried to explore newer materials while curtaining the costs, retained the risks. The time

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scheduling for the work was also changed to handle the time risks. All risks were informed to
the stakeholders of the project at the end.
Stakeholders and Communication Management Issues with the Major Stakeholders
The stakeholders in a project are the ones who affect a project outcome or its execution, are
affected by the project directly or indirectly, etc. In every project there are some people who
have their interest vested in the project like the investors. The customers might be affected by
the outcome of the project. In case of the Blue Spider Project, the major stakeholders were:
 The Parks Corporation as they were awarded the project,
 The customers or the society who would be affected by the structural development of
the technical aspects of the Spartan missile,
 The organization’s management, especially Henry Gable,
 The project manager Gary Anderson along with his team or employees working for
the project and
 The project sponsors
Lord Industries was a stakeholder and the main contractor of the project Spartan missile and
so they will also be affected by this project. These are the main stakeholders in this case
study. Communication management is a crucial part of any project. Rakshit (2014), states that
communication in any project is very important as it help to develop public relations. One of
the major reasons for the failure of the Blue Spider project was their lack of communication
management. There was no communication between the stakeholders and the project
manager. Gary failed to understand the needs of the customers regarding the project agenda
or technical specifications. Effective communication can build better relations with
stakeholders and reduce costs of formally arranged meetings for formal interactions among
stakeholders. The ideas can be developed and risk can be mitigated through better
communication management.

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Suitability of the Selection of Project Manager
The project manager has to lead the project from its conception to close. They must have
leadership skills, administrative knowledge and executive capability (Sunindijo, 2015). Gary
Anderson was a wrong choice of Henry Gable for a project manager. He was an engineer and
did not have the managerial skills. He was mostly involved in making the technical issues
right rather than addressing the managerial and administrative problems. He could not
efficiently manage the risks as he failed to mitigate and communicate the risks with other
stakeholders. The team management to the communication management, Gary failed at all of
these. The skill to manage a project team, handle the risks, motivate the team members, etc.
lacked in Gary. He had to realize that he was not an engineer in the project but the project
manager. There is much difference between project engineering and project management.
This difference was missing in the blue spider project. Gary did not provide timely agendas,
status reports and conduct regular meetings. When there were risks increasing with the
project management kept it all to himself. The lack of good customer relations also impacted
the project. Henry Gable had given some false statements regarding the technical
specifications which won them the project bid. But Gary Anderson, being an engineer,
himself knew the forgery involved. Therefore, he faced a lot of ethical and moral issues
while working for such a project as a manager knowing that the requirements of the project
will never be met.
Situation of Mistrust Between the Customer and the Contractor
Whenever a situation of mistrust occurs in a big project, worth multi millions, then primarily
the authorities doubt or question the project management team regarding the viability of the
progress and the fate of the activities downstream the project (Kerzner and Kerzner, 2017).
Sometimes the customers feel the need to employ their own administrative and monitoring
team to the project management department to closely check each of the activities being

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performed during the course of testing and activities. In case of Blue spider project, similar
instance was observed when the Lords industries had appointed their own team to look into
the development phase, thus making it difficult for Gary and his team to be flexible in their
development process. In fact, the end client, the Army had been doubtful regarding the fate of
the project thus expressing discontent and demanding detailed test results to be presented
before them. Rather, it was required to produce minute details of every activities and ongoing
process, which seem to unnecessarily burden the already overloaded work schedule of Gary
and his program management team. In the case study, it was also observed that the main
contractor, Lords Industries decided to delay the review meeting with the clients, The Army
thus adding up to the complexities and budget of the overall project, also resulting in failures
to meet deadlines and milestones.
Choice of Firm Fixed Price (FFP) Contract
In a project dealt with uncertainties and stakeholders, having low tolerance of risks and low
level of willingness to accept something new to the proposed project, fixed price contract is
well accepted. Lords Industries have been the main contractors, outsourcing the project to
Parks Corporation. In cases, where the project management team must be given flexibilities
to conduct tests and additional improvement over the suggested program, there are chances to
incur additional expense for the changes, possessing the risk of escalating the budget.
Therefore, the Firm Fixed Price (FFP) is appropriate for the Blue Spider program. Another
appropriate type they could have chosen is the Fixed Price Incentive Fee (FPIF) contract,
where there could have been provisions for providing incentives for exceptional performance,
which could have motivated the teams associated with the program to perform at their best,
working on even holidays. The other types related to cost fee contract could never be suitable
for high value projects which has been outsourced, since the program involved R&D and

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testing modules, which can result in attracting absurd costs to the project budget (Kerkhove
and Vanhoucke, 2016).
Evaluation of Project Management
Designing, monitoring and evaluation all comprises of elements of results-based project
management. The fundamental idea of this project management cycle is aiding those with the
responsibility of managing the activities and resources of the project for enhancing the
development results, as per a continuum. Managing for impact signifies the steering of
project interventions through a chain of results, namely, inputs that produce outputs, which
engender outcomes that eventually contribute to the impact. This is can better represented
using the following illustration.
Figure: Managing for impact – The results chain of a project
(Source: ILO, n.d.)
A project is accountable to achieve the outcomes and contribute to the development of the
impact. It is expected that all outcomes of the project have the capacity to contribute to the
impact that is intended. Through the progress of the project, fundamentally the local partners
increase the responsibility to convert the outputs of the project into outcome and at times
when the project has needed, the outcomes contribute to long-term, broader impacts. It is the
accountability of the project management to facilitate the transition process and therefore, it

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is of high significance to negotiate an exit strategy at the start-up stage of the project. This
can be better represented through the following illustration.
Figure: Shifting influence and accountability
(Source: ILO, n.d.)
Managing for impact implies that the project manager and the officials of Blue Spider Project
are required to adapt with the changing circumstances and make appropriate adaption with
the project, so that there are more opportunities to achieve the intended objectives.
The rating has been done on a scale of 5 with 1 representing minimal and 5 representing
maximal ratings.
Initiation
Stage
Planning
Stage
Implementation
Stage
Closeout
phase
Average
Scope
management
2 3 3 2 2.5
Time
Management
2 3 2 2 2.25
Resource
Management
4 4 2 3 3.25
Communicatio
n Management
2 1 1 2 1.5
Stakeholder 2 2 1 2 1.75

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Management
Risk
Management
2 4 4 3 3.25
Contract and
Procure
Management
2 3 2 3 2.5
(Source: Author’s creation)
During the initiation stages, Gary Anderson has been specific enough to look into the
program details, but the entire project specifications were handled by Henry Gable, Director
of Engineering. Thereafter, Anderson was asked to manage the entire Blue Spider program
and submit project proposal. After receiving RFP from Lords industries, Anderson could
notice the trouble areas, which depicted about the lack of management in time, scope and
materials procurement. The inability to deal with the technical specification clearly indicated
the lack of risk assessment and resource management, which were rectified to a little extent in
the planning stage, as tried by Gary later onwards. However, the lack of human resource in
the implementation stages, leading to over time and overload of the program manger himself,
marks for low score, as presented in the above table. The final reports of the testing of the
new procured materials and their test results to be presented before the meeting, comprising
of Lord Industries and the army, serves as the project closure. However, the test results were
not satisfactory as per the anticipated or proposed values, which was well known by the
Project Manager, Gary and the same should have been communicated to the contractor.
However, the senior manager of Gary had advised Gary to not convey the test results and
therefore, the entire project closure process was lacking proper communication and delivery
of the project report upon closure. Based on these information, the ratings as presented in the
table have been developed.
Lessons Learned and Recommendations
One of the most important lessons learnt from the Blue Spider project is regarding the need
for establishing transparent and efficient communication process in the project management,

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so as to ensure trust of the stakeholders. All of the stakeholders unanimously agreed that they
feel discontent or highly dissatisfied about being late to come about any aspect of the project.
All of them want to be clearly communicated about minute changes and updated about the
project (Martens and Carvalho, 2017). Therefore, the most obvious recommendation for the
program manager of Blue Spider is to establish proper communication channels with regular
reporting through effective media, even that include high volume of paperwork. Separate
provisions are required to be made for conducting this time consuming yet mandatory
paperwork.
Next another lesson learnt is regarding preparation of project reports at short and regular
intervals. The stakeholders are keenly interested to receive project reports regularly, as a part
of showing their importance in the ongoing project. it has two benefits, one is related to
keeping documentations about the persons informed about the changes and progress, so that
they cannot blame each other and create chaos later on, and second is related to maintaining a
habit of project tracking system to refer in case of worse situations awakening. The Project
management Office software has developed at large to provide all the necessary functions
related with managing a project, however maintaining a customized dashboard is highly
recommended, in terms of physical and virtual records for avoiding unexpected situations and
ensure proper functioning of the project tasks even during absence of one or more persons,
working in pivotal roles of the project.

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References
ILO, n.d. Project evaluation. Available at: http://www.ilo.org/wcmsp5/groups/public/---
dgreports/---exrel/documents/genericdocument/wcms_172679.pdf [Accessed 09 October
2018].
Kerkhove, L.P. and Vanhoucke, M., 2016. Incentive contract design for projects: The owner׳
s perspective. Omega, 62, pp.93-114.
Kerzner, H. and Kerzner, H.R., 2017. Project management: a systems approach to planning,
scheduling, and controlling. John Wiley & Sons.
Martens, M.L. and Carvalho, M.M., 2017. Key factors of sustainability in project
management context: A survey exploring the project managers' perspective. International
Journal of Project Management, 35(6), pp.1084-1102.
Rakshit, S.K., 2014. Communication management method and system. 6th ed. Abingdon:
Routledge.
Sunindijo, R.Y., 2015. Project manager skills for improving project
performance. International Journal of Business Performance Management, 16(1), pp.67-83.
Team, F.M.E., 2014.Project Risk Management. 8th ed. New Jersey: John Wiley and Sons.
Trevino, L.K. and Nelson, K.A., 2016. Managing business ethics: Straight talk about how to
do it right. 5th ed. New Jersey: John Wiley & Sons.