Assignment 1

Project Risk management

Submitted by
Muhammad Abaid Ullah
01-398191-058
MS-PM 2A

Submitted to
Sir Sulaiman Jahanagir
 The Sydney Opera house
Summary
The Sydney Opera house is not less than a wonder for Australia. Construction of this iconic
building was started in 1958 and was expected to complete in 1962. John Utzon was hired as
architect for this project after he won the competition held by New South Wales government for
this building in 1957. Opera house was scheduled to be completed in 4 year with estimated budget
of AUS $7 million. But this project turned into disaster and took 14 years to complete with cost
$102 million. It could be known as one of the biggest disastrous construction project in terms of
management time and finance. Main reasons of this failure was imbalance between the main
constraints required for managing projects.
First and utmost requirement of project is project scope. In start of the project, goals and
objectives of the project are clearly defined by client, scope is actually the guideline to the manager
for setting project’s direction. Project are dependent on three factors i-e Time, cost and quality. In
this case of Sydney opera house only quality was the main concern of the stakeholders and there
was no restriction on time and cost by the authorities. Design was the main concern of this project
and architects had freedom in that sector of project. John Utzon presented all main plans and
reports by consultants in “RED BOOK” on March 1958. The budget for the project was set from
the amount of dedicated lottery hence this project was not any sort of burden on government. Time
set for project completion was 4 year and was supposed to be completed in 1962 and inaugurated
in 1963. There was no designated Project manager for this project and Utzon was the main
stakeholder of project. Alarming thing about this project was that as an architect Utzon was
concerned with design mainly rather than cost and time constraints. He collaborated with Ove
Arup (in charge of structure and engineering) and other subcontractors related to other deliverables
of project. Second main stakeholder of project was Wales’s government which encompassed
Australian government and competition between them was started. This competition led to
formation of executive committee in charged by Joe Cahill. Committee was formed to supervise
the project with members having no technical skills. The government’s involvement turned into
the hurdle rather than support due to inhibiting changed made by incompetent members of
committee and this lead to the delay and cost overruns in project.
Problems were started in project from very start. Project was divided into three stages. One
was podium, second was outer shell and stage, and third was interior and windows. Due to time
delays government insisted to start the construction before the completion of design. Utzon
protested against it but went in vein, in addition they proposed the change in design after start of
construction.
Initial budget estimation of was made on incomplete designs and surveys which lead to bigger
problem later and contractors claimed additional cost of 1.2 million with delay of 47 weeks in
schedule. In stage two project become more controversial when estimated budget reached 12.5
million after stage one and government had to intervene to monitor cost. Government hold
payments to Utzon due to low progress and high cost claims and later forced Utzon to resign from
this project.
 Later project was handed over to three Australian engineers. Stage two was completed in
1967 with cost of around 13.2 million. New team had to redesign layouts for future work which
led to more complications and cost overruns as Utzon didn’t leave any of his designs behind with
a belief that he’ll be called back, which was not the case. This process of redesign took projects
cost to huge numbers of $85 million and it was huge blow to the project.
Finally after many problems, cost overruns and miss-management the project was
completed in 1973 and was inaugurate by Queen Elizabeth in a same year. Project paid of its price
within 2 years and the architect was awarded with most renowned Pritzker prize for architecture
for his incredible design of the House