Project Management Case Study: Sainsbury’s Retail Company

Introduction

This paper is concerned with the implementation of a project to redesign customer service office space in Sainsbury’s Retail Company to accommodate more staff and furniture. The importance of this project is that it enables the company to employ five additional staff to help in daily communication and attendance to customers. Sainsbury’s is a UK based retail company founded in 1869 and with over 1,200 convenience stores and supermarkets in several regions across the world. It also employs about 161,000 employees around the world. Sainsbury’s mission is to deliver shopping experience by putting customers at everything they do and investing in employees and channels to enhance strong culture and values (J Sainsbury Plc, 2015). Therefore, a good office with enough colleagues and space is needed to enable the company to improve its relationship with customers. With increased customers, it is important to increase the number of employees who can effectively serve the customers and give them the best shopping experience.

The title of the project is – Redesigning Customer Service Office Space to accommodate more Staff and furniture. This should be done at the company’s support center in 33 Holborn, London (J Sainsbury Plc, 2015). Employees use the additional space to respond to the requests, enquiries, feedback, suggestions, and complaints of employees. Additional desks with telephone lines should be added. More furniture for employees and customers who visit the office should also be increased to accommodate more employees and consequently more customers being attended at the same time. This reduces congestions in telephone lines and customer service offices, saves time and hence improves shopping experience for customers. The primary objective is to keep the customers satisfied through convenient support and customer services, and to improve customer experience.

In order to enhance the success of this project, the company needs a small project management team with members from the customer service, finance, marketing and human resource department. The collaboration of all these departments in the project management and implementation ensures that ideas, views and experience of different members of the organisation are brought together to promote and strategies that meet the needs of customers and enhance shopping experience for them.

The paper will include four sections: description of project management principles, project planning, human resources required, and project evaluation. This project describes the theoretical background of project management and how they can be applied to the current project. It also develops a project plan with potential success or failure criteria, project performance measures, project change control procedures and project termination processes. In terms of human resources, the paper will explain the organisational structure of the project, including participants and responsibilities. Project leadership and HR requirements will also be highlighted. Lastly, project evaluation will be provided to explain the success or failure of the project.

Section 1 – Project Management Principles

Understanding project management is important in real life because it enables project managers to plan their activities effectively in order to implement a project successfully. A project is a set of activities organized in a sequential manner to achieve a given objective (Richman, 2002). It involves the development of an idea and establishment of an approach to carry out activities in order to implement that idea. The idea of the current project is to increase customer support office space in order to accommodate more staff and increase customer service experience. This involves a set of activities – developing a plan and a budget to enhance effective use of resources; evaluation of costs and benefits; acquiring materials e.g. furniture, building materials, safety items and finance; execution (redesigning the office); employment of new staff; testing; and closure.

In the process of pursuing success in a project, it is always likely to face risks and challenges. Therefore, success is not guaranteed for projects. The concept of risk in project management necessitates project planning so that uncertainties are taken into consideration before the project is undertaken and during the project implementation process (Lock, 2007). For instance, planning of the current project can be carried out considering the uncertainties that customer service may not improve even after the project, and that to improve customer service employees will still be required to show commitment.

Project management is often carried out by a project management team headed by a project manager who is required to be most specialized in the project area. In the current project, someone who is specialized in customer service is chosen to spearhead the redesign of customer support office. In this case, a member from the Customer support department should be chosen. It is not necessary for the project manager to be a senior executive member of the organisation as long as he/she has a strong background in the specific field of the project (Project Management Institute, 2009). The project manager should also have good communication skills to communicate the vision of the project effectively.

In order to effectively manage projects, it is important for the implementing team to identify and predict difficulties as much as possible. The difficulties to be encountered in the project will be insufficient funds, lack of cooperation, poor support from the management, and insufficient knowledge of the project area by some of the project team members. External factors are also considered in project management. For instance, the project manager needs to consider factors such as seasonal variations and health and safety issues affecting the project.  Inflation, exchange rate fluctuations and other economic factors may also affect the financial plans of a project. This is always common in projects that involve high costs (Richman, 2002).

Project management involves key project phases namely; initiation, planning and scheduling, Execution, and closure. Initiation stage involves the assessment of the project’s scope and purpose. It defines the problem and objective of the project and identifies an idea (Project Management Institute, 2004).  The Customer support office redesign project started with an assessment of its scope and purpose. It is clear that the project team has identified the purpose of the project to be the improvement of customer service experience through increased space and customer staff to serve more customers and reduce time involved per customer. In the planning stage, the project management team identifies the tasks to be executed and allocates resources to each of the tasks. In the current project, the tasks involved include purchasing building materials and office equipment and furniture, renovation of the office, and hiring of more staff. Experts in construction and customer service are used to implement these activities. Risks are also analysed in this stage and the criteria for success/failure is defined. In the execution stage, the project is fully implemented through the performance of the main activities of the project. The activities mentioned above will be carried out in this stage to fulfill the objectives and solution of emerging problems.

Project management systems and processes are used to achieve the project objectives. Project management system ensures that the project is conducted in an effective and smooth manner. One of the project management systems that can be used by project management teams to implement a project is Project Information system (IS). This project management system is flexible software that project managers use to monitor and control information concerning a given project (Pries & Quigley, 2013). The project management information system contains documents that are needed by the project manager to manage the project. Most projects use standardized project management information system which allows users to find relevant data easily during the course of the project management (Howens, 2001). In the customer service office redesign project, project information system can be used to monitor and control information concerning the amount of space to be increased (sq. meters, furniture space, etc.), the number of staff involved, amount of money required in each phase, the quantity of furniture to be purchased, and number of staff to be hired. This data can be stored in the project information system and disseminated to appropriately to various participants as the project progresses.

Section 2: Project Planning

Success/failure Criteria for the Project

The success or failure of the project can be determined with respect to certain criteria. One of the ways of measuring the success or failure of the project is by using the Payback period. This represents the period of time or number of years that will take the project to recover its initial cost. The cost of the project is £400,000 and the expected annual cash flows are as shown below:

Year Cash Inflow Cash Outflow
1 50,000 10,000
2 100,000 10,000
3 200,000 20,000
4 200,000 50,000
5 300,000 50,000

The payback period is 4 years because the company recovers the net cash flows exceed the initial cost after four years. In this case, net cash flows is calculated as (50,000+100,000+200,000+200,000)-(10,000+10,000+20,000+50,0000) = 460,000. Therefore, net cash flows exceed initial cost by (460,000-400,000) = 60,000. This shows that the company will enjoy benefits of the project after four years, so it can invest in the project.

In terms of features, the company is considered successful if all requested features are available. Failure is experienced if most requested features are not available. For instance, requested features for the new project include – increased space in customer support office, more furniture, increased number of customer service staff, and increased telephone lines. The success of the project depends on whether these features will be achieved. If they are not achieved, the project will be considered to have failed.

Operational parameters expected from the project include response time, capacity, etc. In this case, the time that the project takes to be operational should be a reasonable time and should be in line with the planned time. Otherwise the project will be associated with failure. The project will also be successful if it is associated with the desired capacity in terms of number of customers served, the amount of funds used, the number of staff required, and the level of effort required from the management team.

Timeliness determines if the project has been completed according to schedule. The project succeeds if the time spent in each task meets the scheduled time, and fails if the time schedule is not achieved. All tasks or activities should be completed within the planned time in order to avoid failure of the project.

Project Scheduling Techniques Used

After the main project activities have been established, it is important to draw a time schedule that will detail the dates that each activity will be carried out. Sainsbury’s project management team is ought to provide a time schedule using appropriate techniques in order to ensure that each activity is allocated an appropriate amount of time depending on the components of each activity (Lewis, 1998). A milestone chart should be used to display the project schedules. It should display only the key milestones of the project:

  • Initiation phase of the project should start between June 2015 and end in August June 2015.
  • This should be followed by project planning to begin in August and end in September 2015.
  • Execution phase which involves construction and acquisition of staff and materials should then start in September 2015 and end in November 2015.
  • The completion and closure stage should occur in December 2015.

Gantt chart is used to represent the above activities as shown below:

The Gantt chart shows the major activities of the project. The bars of the Gantt chart represent duration of each task while the line inside the bars represents the percentage of completion. The red dotted line from top to bottom represents the critical path, which is the longest path that the project follows to completion.

Project Performance Measures

Performance of the project at each stage should be measured to determine whether it is in line with the project plan. Monitoring and control are essential performance measures tools that can be used to provide judgment concerning the overall performance of the project. Some activities cannot be undertaken without the completion of others. This means that the project begins slowly but picks up faster as more activities come into play. In this case, the costs of the project increase with the advancement of project activities. The new office redesign project is monitored and evaluated regularly to ensure that they meet the capacity and time requirements of the project. The monitoring and evaluation team is chosen and tasked with the role of evaluating each task to see that they are in line with planned outcome.

One of the project performance measures that apply to the project is cost estimation. In this case, project tasks are assessed in order to determine whether capital has been invested effectively. Cost estimation also enables the organisation to focus on areas that incur high costs. In the office redesign project, the tasks that took most of the project costs were the costs of renovating the existing offices, the cost of paying additional staff, the cost of purchasing office furniture and equipment, and the cost of increased administration costs. These areas therefore needed special attention and a lot of time from the project implementation team (Pries & Quigley, 203). The monitoring team should provide feedback to the team manager concerning the progress of the project so that the project operates within the budget and meets the cost requirements of all tasks or activities.

Project Change Control Procedures

Change is common in some stages of most projects. Change needs to be initiated in line with the timescale of the project so that the project is completed within the scheduled time. Project tasks need to be given some level of flexibility in order to allow for the changes to occur. A rigid change control mechanism will hinder the progress of the project rather than supporting it (Kerzner, 2001). In the case of customer support office redesign project, change control should be implemented to allow for flexibility. For instance, if the initial renovation fails to provide enough space, expansion to another space may be suggested as part of a change process. These changes to the project activities need an effective change control mechanisms including communication and risk management.

The contractors and in-house project managers involved in the office redesign project should identify some areas that need improvement at each stage of the project. For instance, whenever the new design was found to be different from the needs of customers, the project should be informed, and appropriate changes should be proposed. The project manager then communicates some changes that should be included in the succeeding tasks in order to bring the project back to the intended progress (Turner, 2003). Changes in the project should be brought before a change committee which analyses the extent of such changes and their implications on the project in terms of cost, time, stock level, and reliability. The change committee in most projects also takes appropriate steps to rectify any damage caused by negative effect of changes.

Project Termination Process

Project termination is an essential consideration of a business in its project progress. It is a decision that needs to be made by both the project management team and the control committee. Every project comes to an end eventually, and appropriate mechanisms need to be used to close it. Some of the factors that need to be considered in project termination include: technical objectives, ROI achieved, engineering design, and intellectual property rights (Chartered Institute of Building (Great Britain), 2010). Project termination may occur due to successful completion of the project or complete failure.

Customer support redesign project should be terminated or closed appropriately once it becomes successful or when it fails. If the project succeeds, it should be approved as a formal part of the organisation’s operational activities. The project termination process involves the transfer of resources such as materials, office equipment and materials, and personnel used in the project to other uses within the parent organisation (Sainsbury’s). All the contractors who renovated the offices are also assessed and evaluated for success and given their last payments as they head back to their organizations (Turner, 2003). The variety of project termination for the Sainsbury project is positive if the scope has been completed successfully and the client (Sainsbury) has accepted it. As part of the project termination, the product of the project (new office, new staff, and new furniture) is released to the client for use.

Section 3: Project Human Resources

Human resources are required in both the leadership level and the project team of the project management in order to carry out tasks of the project successfully. Leaders ensure that the project is completed according to the required standards of the project as contained in the constraints, targets, project schedules, deadlines, and budgets (Pries & Quigley, 2013). The team members on the other hand play key roles in the project implementation by participating in project activities. The relationship among team members and leaders is also important for the project management team to achieve its project objectives.

The client of the support office redesign project is the Sainsbury’s and its funder is also Sainsbury’s. The leaders of the project team came from the head functional departments of the company. All the activities were organised, controlled and coordinated by the leaders while the team members carried out specific tasks such as removing old structures and putting up new ones, arranging the redesigned room, painting walls, buying materials and installing equipment and furniture in the office. For effective coordination of these activities and successful achievement of the project’s activities, the project team needs a good leadership that communicates and allocates duties and resources successfully.

Project Organization Structure

The human resources required for a project management exercise form an organisational structure that influences the project management significantly. The success of the project management largely depends on the organisational structure. Customer service office redesign should also have a management team with its own organisational structure composed of a project manager, employees of Sainsbury, external contractors and other stakeholders.

The organisational structure of every business project management should have a mission, aims and objectives that are clearly set and communicated across the entire project management team (Lewis, 1998). The aim of customer service office redesign project is to redesign its customer support office to create more space in order to accommodate more staff and serve more customers faster. The organisation structure of the project management intends to achieve these objectives.

The project management team is also structured according to the functions and processes of the project (Richman, 2002). In this case, human resources are organized in terms of their areas of specialization. The organisational structure of a project management can be designed in such a way that various departments are interconnected and different levels of management are organized from top level management to the bottom level management.

Project management team of the customer service office redesign project was organized from top level management, middle management, the support staff, infrastructure and operating core. The top level management was composed of the project manager while the middle staff was made up of departmental heads. The operating core was composed of the project team members who carried out the main activities. This management organization is shown below:

Fig 1: Management Organisation of customer service office redesign project

The figure above shows that the support staff and infrastructure help the operating core and the middle management to perform the project tasks and report to the top management (Portny, 2007).  The operating core in the project includes the staff that carries out construction and furnishing activities. The top management also delegates duties to the middle management to direct daily activities of the project.

The organisational structure of the customer service redesign project is also represented by a functional structure in which various departments are interrelated to run the activities effectively. This can be shown in the figure below.

The diagram above indicates a functional structure whereby various levels of management may be organized in each department of Sainsbury’s as members of the customer service office redesign project management team. From the figure, the project manager sits at the top while the middle level management for each department is organized at the middle. A1, A2, B1, B2, etc. are members of the operation core in the project who carry out the specific tasks of the project.

Project Leadership

Project leaders are members of the project management team who are interested with leading others to complete project activities according to the required standards of the project. They ensure that the project core team follows predetermined schedules, deadlines and budgets to achieve the set targets and objectives (Project Management Institute, 2004). Leadership of the Customer service office redesign project should act as transformational leaders and pay as much attention to people and relationships as to the tasks. They should use effective communication skills to communicate the purpose of the project and bring together all members of the project management team through teamwork in each project task.  Team leaders in project management need to develop certain leadership qualities in order to lead others towards the achievement of project objectives. The customer service office redesign project was designed through an effective leadership. The project manager should work with members of the project team and distinguish the project with the way in which it plans and understands their roles. This indicates a good quality of leaders in a project (Knutson, 2001).

Project HR Requirements

There are various HR requirements for each project management. All resource requirements are important for project management process, but the most important is workforce (Desmond, 2004). Careful planning and scheduling of human resources is essential if the project is to be run in a smooth manner. The resource requirement of the Customer service office redesign project was determined by planning and estimating the needs of the client. The project work involved construction of a bigger office, new design, and furnishing. The resource requirement was therefore determined by analysing these activities. The workforce was then derived from external contractors. Procurement experts were also involved in the project so that they could purchase materials and equipments for the new office (Turner, 2003).

This shows that it is necessary to estimate the requirements of the project tasks and matching them with the appropriate human resources. Certain factors can hinder the effectiveness of human resources. Such factors include illnesses, injuries and conflict in the project management team. Therefore, human resources requirements should provide room for absenteeism and errors in their estimations (Desmond, 2004).

Section 4: Project Evaluation

Evaluation of the project is determined using performance measurement. This can be done using cost estimation or earned value control. For the case of earned value control, the cost and time of undertaking the project is measured in order to determine the success or failure of the project. The project was planned to produce £550,000 after five years as shown below.

The project plan for redesigning support office of Sainsbury was also designed appropriately by the project management team in order to enhance success of the project. The plan allowed various departments of the project to utilise its resources including human resources effectively to meet the set objectives without incurring a lot of costs. The project was also done to the satisfaction of employees and customers because the project team applied appropriate estimations, plans and ideas to guide the project towards the achievement of its objectives. Planning for the project was successful because activities were scheduled well and the project’s feasibility was assessed by the directors of the company. Cost control, human resource requirements, and estimate techniques were also assessed appropriately to ensure that the project activities meet the desired objectives. The functional organisation structure of the project management also ensured that there is an appropriate management and coordination of activities in the project.

Project performance measures for the customer support office design project have been analysed by the project team to determine the success of the project. This led to project monitoring and control procedures which ensured that the project is kept on the right path from the beginning to the end. This approach ensures that the project rolls according to plan and that the project activities will be achieved. Therefore, with the monitoring and change control procedures, the team was able to identify the key issues that could hinder the project. As a result, appropriate changes were implemented to keep the project in good track and achieve the desired outcome.

Generally, Customer service office project was successful because the project management team applied all the project management processes and procedures beginning with planning, scheduling, performance measures, change control, and project termination. In conclusion, the project was successful and most of the stakeholders were impressed with the outcome. The project was exciting since it involved a good cooperation from members of different departments and encouraged the utilization of available resources to achieve common objectives for the organisation.

 

References

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