New Park Road Stadium

Project File

BUFC

Birmingham United Football Club

PREPARATORY EXERCISE
 BUFC

Appointment Letter

FROM: Peter Dillon, Project Director, Birmingham United FC

TO: Pat Monro, Project Manager

Dear Pat,

I'm really glad you are able to work with us on the new stadium project. This
is obviously a once-in-a-lifetime type investment for our club and we’ve
recognised the need to bring in professional project management skills if it is
to be an overall success. It is now your responsibility to manage the project
until the completion of construction.

In our initial discussions you mentioned that you should be able to help us on
most aspects of this project. In particular, before the building work actually
starts, I would like you to prepare a written report summarising the following
key issues:

1. SCOPE - what are we going to include in the design brief that describes
what will actually be built ?
2. CONTRACT - what are the pros and cons of the various options ?
3. STAKEHOLDERS - who are the key stakeholders that we need to work
with in this project ?
4. RISKS - what are the main risks that you will need to anticipate and
manage ?
5. BUSINESS MODEL - how is the stadium (and the project to build it)
linked with the club's business model ?
6. PROJECT PLANNING - what is the sequence of key tasks, and who will
do them ? How long will it take ?
7. INTEGRATION - how is everything above connected ?

Please find attached some background information about our club to get you
going.

I look forward to hearing from you shortly.

Best regards

Peter

Peter Dillon
Project Director
Birmingham United FC

page 2
 BUFC
Background

Birmingham United FC was established in 1898.

Birmingham United is a Limited Company. The Chairman, Andrew Hill-Norton,

has a 45% shareholding. Eddie King, another board member owns an 8%
stake. The rest of the shares are owned primarily by small shareholders,
including some of the supporters.

Park Road Stadium was originally built in 1937, and the main stands were re-
developed in 1992 after the Taylor Report that required all-seater stadia.

The current capacity of Park Road is 25,350. In the last 10 seasons an average
of 62% of these seats has been taken by season ticket holders. Birmingham
United fans, also known as the “Parkers”, are some of the most loyal
supporters in the top two divisions, with an average of 74% of season ticket
holders attending all the home games. Last season there was an average gate
(attendance) of 22,723 – just under 90% of capacity.

During the feasibility phase, two other sites were considered for the new
stadium, but after a detailed analysis of the site selection criteria
(accessibility, physical characteristics, planning policy, etc.) it was decided
that the existing Park Road site should be used, obviously requiring the
demolition of the old stadium.

There has been an indication from Antonia Boyd at EF Bank that the maximum
debt facility they will consider to finance the project is £50m.

During the period of ‘de-constructing’ the old stadium and constructing the
new one, Birmingham United have agreed a ground share with nearby
Coventry City, whose stadium has a capacity of 32,500. The club estimates
that if there is a delay beyond the planned opening date, the business will
incur a net loss of £600,000 per month whilst continuing the ground share.

page 3
 BUFC
(1) New Stadium Scope Options

Many aspects of the design brief (i.e. overall scope) are fixed; for example,
Birmingham United have stipulated that the pitch size must be within football
league regulations, the distance between the pitch and first row of seating
must be between 5 and 8 metres, there must be a continuous seating bowl
with tip-up seats, the scope must include dressing, media and security rooms,
a shop, etc.

Beyond these details, what are main options that we will need to make
decisions on, in order to finalise what actually gets built ?

At this point, we just need the main ones, probably about 10 of them. We
don't need to worry about the colour of the seats yet!

e.g. Number of Seats

page 4
(2) Contract choices: PROs & CONs
There are four key clauses in the contract, each with two possible choices. Please include the pros and cons,
as far as the club is concerned.

CLAUSE CHOICES PROs CONs

SEPARATED
(different contractors
do 'design' and 'build'
tasks)
(a)
PROCUREMENT
STRATEGY
DESIGN & BUILD
(same contractor
does 'design' and
'build' tasks)

CONVENTIONAL
(typical form used in
the past)

(b) CONTRACT
TYPE

PARTNERING
(language replaces
win-lose logic with
shared objectives)

FIXED PRICE (even

if it costs twice as
much as planned,
club pays the same)

(c) PRICING
OPTIONS

50/50 PAIN GAIN

(if it costs more than
planned, club pays
more, and vice versa)

MONTHLY AMOUNT
(if it is late,
contractor pays a
(d) LIQUIDATED penalty to club)
DAMAGES

NONE

Page 5
Contract preferences

The following three people need to sign the contract:

• Chief Executive
• Main Contractor's Project Manager
• Banker
Here are the views they expressed to me about the contract :

Combining your views on the pros and cons of the various clauses with
the need for all three of these people to sign the contract, please choose
what contract you think is most appropriate, and explain the rationale for
this choice.

Procurement "Separated" OR "Design & Build" ?

Strategy

Contract "Conventional" OR "Partnering"

Type

Pricing "Fixed Price" OR "50/50 Pain Gain"

Options

Liquidated "Monthly amount" OR "None"

Damages

Page 6
(3) Stakeholder List

A "stakeholder" is someone who is affected by, and/or in a position to affect, the project. Try and
identify the top eight stakeholders, both inside and outside the club.

Profile (i.e. issues relating to the new stadium project that they are likely to be
Name Role
interested in)

Andrew Hill-
Chairman Seating capacity
Norton

Peter Dillon Project Director Sticking to the plan

Stakeholder
3

Stakeholder
4

Stakeholder
5

Stakeholder
6

Stakeholder
7

Stakeholder
8

page 7
(4) Risk Log

What are the major risks (and opportunities) that could affect the project ?

Category (what does the

risk directly affect?):
Number Tasks, Contract, Description and Impact
Contractors, Scope
Options, Business Model

1 Task Crane failure causes delay and extra cost

2 Business Model Recession reduces demand for corporate boxes

3 Scope Change in safety regulations about seating

10

page 8
(5) Business Model
It's important that we understand how the stadium (AND the project to build it) are linked
with the club's business model

What are 3 or 4 key variables that you could use to describe the business model at a high
level ?
e.g. Annual revenue from football matches
Operating profit per year

What aspects of the stadium design (including those options you identified in step 1) will
have a direct impact on the business model of the club ?

e.g. Number of seats

What project variables will have a direct impact on the business model of the club ?

e.g. Opening date

What assumptions will have a direct impact on the business model of the club ?

e.g. Expected match attendance

page 9
(6) Project Planning

Here is a list of the main tasks involved in the project. Please develop a logical flow chart (with boxes to
represent the tasks and arrows to represent the links between them), a GANTT chart, and on both of them
highlight the critical path of the project.

expected required to
approx. cost
duration start

appointment of
Task 1.1 Scheme Design 2 months £900,000
design team

Task 1.2 Detailed Design 3 months £1.5 million 1.1 complete

Task 1.3 Drawings & Specs 2 months £650,000 1.2 complete

Task 2.1 Demolition & Excavation 3 months £1.4 million 1.2 complete

Task 2.2 Substructures 2 months £1.7 – 2.5 million 1.3 complete

£7.0 – £13.0 2.1 & 2.2

Task 2.3 Lower Superstructures 4 months
million complete

2.3 started
Task 2.4 Lower Seating 3 months £1.8 million
(+ 1 month)

£8.0 – £14.0
Task 3.1 Upper Superstructures 5 months 2.3 complete
million

£3.5 – £4.0 3.1 started

Task 3.2 Cladding 3 months
million (+ 1 month)

3.1 started
Task 3.3 Mechanical & Electrical Services 5 months £5.0 million
(+ 1 month)

£4.0 – £6.0
Task 3.4 Finishes & Fitting Out 3 months 3.1 complete
million

£2.0 – £2.5
Task 3.5 External Works 4 months 3.1 complete
million

£2.0 – £2.3 3.2 & 3.3

Task 3.6 Special Installations 2 months
million complete

2.4, 3.4, 3.5 &

Task 3.7 Commissioning 1 month £200,000
3.6 complete

page 10
 Task 1.1!
Logical Flow!
Task 1.2!
Page 11

Task 3.7!
Bar Chart (GANTT)
aug sep oct nov dec jan feb mar apr may jun jul aug sep oct nov dec jan feb mar apr may jun jul aug sep oct nov dec jan
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

1.1 scheme design

1.2 detailed design
1.3 drawings & specs
2.1 demolition, excavation
2.2 substructures
2.3 lower superstructures
2.4 lower seating
3.1 upper superstructures
3.2 cladding
3.3 M&E services
3.4 internal finishes, fitting out
3.5 external works
3.6 special installations
3.7 commissioning
Resources Please choose the best resource for each task

possible
initial spec Your choice &
task sub-con- description of possible sub-contractors
target price £ rationale
tractors

Sub-contractor A is a team with considerable

experience in the design of modern sports stadia and
they have been appointed to do all the design tasks for
(1.1) scheme the new Park Road stadium. The team includes Helen
A 905,000
design Archibald, Architect and Head of the Design Team and
Steve Cheng, the Structural Engineer. The team also
includes Services Engineers, Fire Engineers and a
Quantity Surveyor.

(1.2) detailed
A 1,265,000 Sub-contractor A
design

(1.3) drawings
A 670,000 Sub-contractor A
& specs

(2.1) The D1 Demolition Group is one of the UK's leading

demolition, D1 1,375,000 demolition and decommissioning companies; it has an
excavation international reputation.

Established over 30 years ago, D2 Ltd offers a wide

range of services, including demolition by controlled
D2 1,390,000
use of explosives & asbestos removal. Their
capabilities fit well with the work needed at Park Road.

D3 Demolition Services is a less well-known company

D3 1,150,000 in this field, but their tender price provides a good
reason to appoint them.

E1 has a full range of piling techniques that includes

(2.2) sub-
E1 1,710,000 rotary bored and precast driven. E1 did some of the
structures
foundations work at the new Wembley Stadium

E2 are acknowledged experts in the creation of

E2 1,780,000 foundation solutions. They have a depth of technical
excellence and hands-on experience.

E3 has a reasonable reputation and their rates are

E3 1,590,000
always competitive.

(2.3) lower F1 is an alliance of steel and concrete contractors that

super- F1 7,010,000 have specialist experience of working together on
structures stadium construction projects.

F2 is a construction firm specialising in composite steel

and concrete grandstand structures. F2 has gained its
F2 7,070,000
reputation by working on highly innovative and ground-
breaking design concepts.

F3, partly because of their specialist pre-fabricating

F3 7,720,000 capability, have indicated that they could complete the
lower superstructures task in 3 months.

Specialists in all grandstand solutions, G1 Seating has

(2.4) lower worked on several high profile football stadia; their
G1 1,985,000
seating team designs and installs bespoke arena seating for
any size venue.

G2 is one of the UK's leading suppliers of permanent

arena seating. Their tender price reflects the smaller
G2 1,760,000
team they would employ and that it would take them 4
months to complete the work

page 13
(3.1) upper F1 is an alliance of steel and concrete contractors that
super- F1 7,850,000 have specialist experience of working together on
structures stadium construction projects.
F2 is a construction firm specialising in composite steel
and concrete grandstand structures. F2 has gained its
F2 7,925,000
reputation by working on highly innovative and ground-
breaking design concepts.

F3 have indicated that they could again reduce the

timeframe of this task; they could do it in 4 months
F3 8,860,000
not 5. F3's tender price is, however, approximately
£1m higher than the competing bids.

H1 is probably the UK's best known cladding and

(3.2) cladding H1 3,530,000
insulation sub-contractor.
H2 has grown considerably during the recent
construction boom. For the major cladding contracts,
H2 3,620,000
H2 is normally in a straight fight with H1 and they do
not necessarily compete on price.

I1 is a consortium of some leading providers of

building services, mechanical, electrical and
(3.3) M&E
I1 5,055,000 engineering solutions. I1 was responsible for all the
services
mechanical & electrical services at Reading FC's
stadium.
I2 describe themselves as the partner of choice for M &
E services contracts. I2 has considerable experience of
I2 5,130,000
stadium projects, having worked on the City of
Manchester stadium, amongst others.

I3 have indicated that they would complete the M&E

I3 5,540,000 services task in 4 months not 5; their tender price
reflects this.

(3.4) internal J1 provides a full range of interior finishes and fittings

finishes, J1 3,925,000 services, with particular experience in retail outlets,
fitting out hospitals and sports arenas.
J2 is a small consortium of fittings and internal finishes
contractors. It has a reputation for delivering very high
J2 4,060,000
standards: they are perhaps a bit more reliable than
J1.

K1 has worked on a variety of external works and

(3.5) external
K1 2,650,000 landscaping contracts, ranging in value from £ 20,000
works
to £ 5million.
K2 is an alliance of external works contractors, more
K2 2,770,000 expensive than K1 but not necessarily any better for
this work.

I1 is a consortium of some leading providers of

building services, mechanical, electrical and
(3.6) special
I1 1,880,000 engineering solutions. I1 was responsible for all the
installations
mechanical & electrical services at Reading FC's
stadium.
I2 describe themselves as the partner of choice for M &
E services contracts. I2 has considerable experience of
I2 1,910,000
stadium projects, having worked on the City of
Manchester stadium, amongst others.
I3 have put in a more expensive quote, but this does
I3 2,190,000
not mean they would do a better job.

(3.7)
L1 will be contracted to assist with the final
commission- L1 160,000
commissioning task.
ing

page 14
 (7) Integration
In order to see how everything fits together, please add arrows to indicate what affects what. Please also add new boxes and arrows to indicate
the different types of risks and what they impact

time/cost/quality
resourcing outcomes
decisions
Page 15

contract business
decisions outcomes

scope
decisions stakeholder
reactions