The document contains information about the Terminal 2 project and its management as well as the decision to redevelop Terminal 2 as part of the BAA strategic plan. It also comprises a detailed academic analysis of the program of development of Heathrow Airport. It explores the strategy of BAA regarding Terminal 2 and its project management. Additionally, it contains project management lessons learned from Terminal 5 and the way they have affected the project management of Terminal 2. Finally, it explores whether the project will achieve the BAA strategic objectives
Heathrow Airport management strives to ensure that they avoid another crisis as witnessed with the construction of Terminal 5. As a result, the management of Terminal 2 was enhanced by taking into consideration the flaws experienced in the construction of Terminal 5. The project began in 2012 as a joint venture aimed at building an innovative and sustainable terminal. Evidently, the terminal was to advance Heathrow’s strategies and vision. The goal of developing Terminal 2 was to create an environment that would better the passengers' experience by delivering improvements in the areas concerned with the passengers. The terminal will eventually serve more than 20 million passengers a year. It will also be a home to 23 airlines.
Heathrow is the world’s busiest international airport since it is used by millions of people to connect to the world. However, the airport has an ageing infrastructure. As a result, an overhaul was imperative. The establishment of Terminal 2 is aimed at ensuring the airport's capacity to handle more passengers. Additionally, it was also aimed at generating more revenue and enhancing job creation in the country. Heathrow used its old Terminal 2 and outdated facilities to handle 1.2 million passengers annually. Reinventing the Terminal is essential since the airport will have improved satisfaction levels, thereby influencing passengers' spending at the airport. Additionally, it will help maximize economic benefits through the facilities the airport will provide and minimize its impact on the environment.
The report is well-structured and focuses on the major objectives that include BAA’s strategic objectives, the project management of Terminal 2, Lessons learned from Terminal 5's project management, and the conclusion and recommendations section. The structure plays an important role in creating a framework that allows to draw a valid conclusion. In this case, the conclusion and recommendations will be based on the project management.
BAA Strategic Objectives
The airport is owned and managed by BAA. Their project objectives are:
- Transforming the airport through superior facilities
- Ensuring the minimal impact of the project on the operational capacity of the airport
- Establishing revenue opportunities through commercial products
- Supporting the airline community
- Enhancing sustainable measures that will ensure fewer effects on the environment
- Providing a sustainable design, building, and operations
The strategic objective of BAA is to make Heathrow Airport Europe's hub choice by enhancing the passengers' experience and journeys. Their main aim is to ensure that the customers enjoy the facilities the airport has to offer. Moreover, BAA is aimed at creating financial opportunities that will benefit the airport.
Terminal 2 and Its Project Management
Terminal 2 replacement program was aimed at providing a visually stunning terminal and facilities that would replace the old one. The project is directed at providing the passengers with better experience through an airy and spacious feel. Additionally, the project is to realize this goal through closely grouped airlines that would provide a smooth passenger journey.
- To enhance passengers' experience through the delivery of improvements in the services and facilities.
- To handle passengers and aircraft
- To reduce congestions in the airport lobbies through a reconfigured layout
- To promote sustainability
- To open a new energy center and cooling station to enhance sustainability and minimize the airport's impact on the environment.
- To launch a new multistory car park linked to the terminal
The project management of Terminal 2B is influenced by service proportions and passenger principles. As a result, the Terminal management sought an approach that would improve the passengers’ experience. Additionally, the service proportions approach is aimed at utilizing the airport's specific responsibilities to achieve their vision. In this case, the passenger principles utilized in the project were to show they care, delight, and value money, affordability, consistent basics, easier journeys, as well as reliability and predictability (Larson & Gray, 2014).
Terminal 2’s project management strives to ensure that basics such as cleanliness, easy navigation, safety, and security are delivered. It also tries to guarantee the passengers' positive experience with regards to departures, arrivals, and connecting flights. The project management strategy entailed the provision of solutions for the passengers and the airlines through helpfulness, courtesy, helpfulness, and knowledge.
The steady progress in the refurbishment and replacement program of the Terminal was achieved as the project utilized stakeholders from the community. The latter played a major role in the development and integration of the operating procedures for the new terminal.
The project began with the closure and demolition of the original building. Additionally, the size of the new building required the demolition of the Queen's Building and the adjacent car park.
The project is realized in two phases with the aim of avoiding disruption to passengers. In this case, the initial construction will occur on the old Terminal 2 and Queen's Building site for the main terminal.
The project is aimed at creating a new terminal that has:
- A sustainable design
- A sustainable building
- Sustainable operations
The project is designed to create a new terminal that incorporates an integrated baggage system, airy and spacious lobbies, and a covered courtyard that would link the terminal to the multistory car park (‘Airport technology,’ 2013). The project will also encompass the construction of a satellite terminal that will have additional passenger gates and aircraft parking stands.
The construction of the building will extend the main terminal 2 building 100 meters northwards towards the terminal 1 site. It will also include the construction of a second satellite building that will increase the terminals' capacity from 20 million to 30 million passengers a year. The project will also undergo six months of testing the facilities' operational systems and equipment to ensure that they operate effectively without teething problems as witnessed in the event of Terminal 5.
In this case, it is evident that the deliverables have been achieved based on the completion of phase 1 of the project. However, the same deliverables apply for the second phase aimed at enhancing the activities of the terminal through additional space to host more passengers annually.
Sustainable operations in phase 1 are evident due to the provision of additional check-in points to enhance the easy flow of passengers through the airport. Additionally, advanced security and fast bag drop facilities also testify to their effectiveness. On the other hand, the terminal has also achieved a sustainable design through the establishment of recreational halls and lounges that are spacious and filled with natural light. Phase 1 of the project also demonstrates a sustainable building design due to the significant decrease in carbon dioxide emissions. Moreover, the flow of natural light through the use of floor-to-ceiling windows enables the airport to minimize the use of electricity by relying on renewable sources.
The overall size of the new Terminal 2 is scaled to be six times bigger than the original. As a result, the budget for the construction was more than that of any other terminal in the airport. The overall construction of the terminal had a budget of 11 billion Euros. In this case, the budget ensured the terminal's modernization and meeting the airport's needs for expansion.
The construction of Phase 1 began in 2009 and was scheduled for completion in 2012. However, it was completed in 2014. Phase 2 of the project is currently in progress and is estimated to be complete around 2019 and 2020.
About 35,000 people are working on the project with as many as 5,000 people on the site.
The first phase of the project cost a total of 2.5 billion Euros upon its completion in 2013. An additional cost of 5.3 billion Euros will be spent on the second phase that will be completed around 2019 and 2020.
Cost (Billion Euros)
Client: Heathrow Airport.
Financers: Heathrow Airport fully funded the construction project.
Client’s customers: Travelers from all over the globe using the facility.
Principal contractor: Luis Vidal + Architects are the lead contractors on the project.
Other contractors: HETCo, Balfour Beatty, Laing O’Rourke, Mace and Siemens, Firstco, Tyco, BT, Fujitsu, Kone, and McDonald's.
Lessons Learned from Terminal 5 Project Management
The greatest lesson learned from the Heathrow terminal 5 projects is risk management. Before the beginning of the construction, the developers ran a test project to determine the success rate. As it was a relatively big project, they had to determine the best possible ways of constructing with minimal chances for failure. Doing a test run on the project essentially ensures that the implementation of the real project will take a shorter duration to complete. The time frame is shortened because once the trial is complete, the developers know which areas to cut on time and which areas will be more time-consuming (Massey, 2008). It also prospects that the entire project may cost less than estimated. Normally, when budgets are drawn out, the estimates are always on the higher side; hence, in case of a trial, it shows the exact figures and the amount that would be set aside for a miscellaneous budget.
The second lesson learned from the projects was how the government could further handle big projects and stick to budgets. Even with the negative effects the project had, the government now takes pride in learning from experience how to construct projects that have the potential to positively influence the nation due to their efficiency and magnitude. The experience has been carried forward to more projects, thereby positively influencing their outcomes (Ijeh, 2014).
The third lesson is the ability to offer a bigger facility for greater capacities. The construction of the terminal was meant to offer world-class services in the airport. With the increasing demand for air transport and the need for efficiency, it was designed to offer the best. The terminal was highly automated to ensure speed and efficiency. It was also cost-effective, as it did not require many staff members. The introduction of a baggage system ensured that the passengers got their luggage promptly and efficiently. However, with the introduction of the above-mentioned systems, there appeared a growing need for developing the entire airport system. The pressure led to one of the failures in the terminal. Notably, this would have been avoided by implementing an overhaul of the programming and automated systems.
The fourth lesson learned is that organizations need to adequately train their staff members on the running of the entire system. In the case of Heathrow airport, when there was a crisis in the luggage department, most of them had no idea how to handle the backlog of lost and misplaced luggage. With the implementation of the completely automated system, the airport management became confident about the delivery of luggage. However, it was noted that they overlooked the fact that the system's program could shut down. The provision of this feature caused the airport to report the greatest amount of lost or misplaced luggage in airport history. However, if the staff had been properly trained, they would have been in a position to avoid the massive damages.
Finally, a key lesson learned from the Terminal 5 airport is the ability to foresee the failure of a project and minimize the ability of the entire project failure. During the actualization of the concepts, there are certain aspects of the project that show the signs of weakness or failure even before the launch. With the Heathrow terminal 5 projects, there were features in the communication and technology departments that were found to be unsuccessful (McDonald, 2012). However, because the project had a strict deadline, they needed to complete and open it for use as they resolved the upcoming issues. The danger with that is that with the launch of any project, there are issues that come up due to implementation. When they are combined with previously ignored issues, it puts the entire project at the risk of failure. Therefore, it is important to resolve the issues as they come up during the concept stage, the implementation, and the launching as well.
The lessons learned from the management of Terminal 5 played a major role in reshaping the management of the Terminal 2 project. In this case, the competition of phase one of the project witnessed a slow start. The latter was aimed at ensuring that the operations were not subjected to a glitch as witnessed on the opening day of Terminal 5. Evidently, the opening of Terminal 5 led to losses in revenue due to canceled flights and stuck bags. The slow start is essential since it also ensures that the staff familiarize themselves with the new environment and the advanced systems installed. Additionally, phase one of Terminal 2 is aimed at building its operations gradually. The terminal will be home to 26 airlines that make up the Star Alliance. However, the terminal only accommodated one airline upon its completion, with the others joining in gradually. Finally, the faults witnessed in Terminal 5 led to the need to test equipment to ensure its efficient functioning. As a result, all the staff working at the terminal were subjected to participating in the training sessions. Moreover, the airport conducted multiple tests targeted at testing their capacity.
Conclusion and Recommendations
Heathrow is the world’s busiest international airport since it is used by millions of people to connect with the rest of the world. As a result, it is important for the airport to have an up-to-date infrastructure that is capable of serving the millions of people who go through the airport annually and enhancing their experience. Evidently, Heathrow Airport management in the Terminal 2 project is eager to avoid another crisis as witnessed with the construction of Terminal 5. The project began in 2012 as a joint venture aimed at building an innovative and sustainable terminal. The innovations and sustainable measures incorporated are evident with the completion of the first phase.
Terminal 2 replacement program was directed at providing a visually stunning terminal and facilities that would replace the old one. In this case, the success of the project would attribute to an enhanced passenger experience through the delivery of improvements in services and facilities. It would also lead to the airport's ability to handle forecast passengers and aircraft as well as reduce congestions in the airport lobbies through a reconfigured layout. The project would also result in the promotion of sustainability through the creation of a new energy center and cooling station to enhance durability and minimize the airport's impact on the environment. Moreover, it would introduce a new multistory car park linked to the terminal to enhance passenger movement.
The project management of Terminal 2B is influenced by service proportions and passenger principles (“Premier Construction," 2013). Passenger principles are important since they will reflect that the management care, delight, and value passengers' money. Additionally, the strategy is essential since it will enhance affordability, consistent basics, easier journeys, as well as reliability and predictability in the airport operations. Phase 2 is expected to reflect a sustainable design and building including sustainable operations as demonstrated by the success of phase 1. The construction of Terminal 2 was influenced by the greatest lesson learned from the Heathrow terminal 5 projects which were risky in management. In this case, the success of the project will ensure that it achieves BAA’s strategic objectives.
Project management requires the ability to foresee the failure of a project and minimize the ability of the entire project's failing. Additionally, based on the report, it is important to resolve issues as they come up during the concept stage, the implementation, and the launching. Furthermore, it is also recommended that the staff should be properly trained in the event of restructuring to ensure that there are no setbacks as witnessed in the opening of Terminal 5.