Why Projects Fail in Airbus – A380

Singapore Airlines Limited (SIA) is the largest five-star airline in Singapore. The company operates a hub in Changi International Airport, Singapore’s main airport, and a major hub in Southeast Asia. Singapore Airlines, however, also has a considerably strong presence in South Asia and East Asia. The company became famous for being the first company to acquire the Airbus A380, which is still the world’s largest passenger aircraft. Apart from passenger and cargo transport, SIA also engages in aircraft handling and engineering. Even though the company is a network carrier, it has also diversified its operations to the regional and low-cost carrier subsectors through its subsidiaries such as Silk Air, Singapore Airlines, Cargo Tiger Airways, and Scoot. The company ranks among the top 10 carriers in term of the number of international passengers carried and the top 15 in terms of revenue. The airline is renowned for effective human resource management, which has been a major source of sustainable competitive advantage over the last few decades (Wirtz et al., 2008, p. 4). This was achieved through stringent recruitment and selection practices, rigorous training and development, control of service quality through empowerment of frontline staff, and employee motivation.

The report will analyze the project management practices at the company in a bid to identify the factors that contribute to project failure. To this end, the report will adopt a case study research design. The case study will highlight the various project management practices that contribute to project success and failure and investigate the measures that have been taken by the company to ensure project success. Because the outcome of the Airbus-A380 project at SIA also relies heavily on the aircraft’s manufacture, the report will also focus on the conceptualization and initial production of the A380 in order to identify any challenges that can be traced back to the manufacturer.

To facilitate a critical analysis of the case, an extensive literature review will be carried out to establish the theoretical framework in project management. This framework will provide valuable insights into the signs, major causes, and solutions to project failure. Even though the case study research design provides a holistic perspective of the organization and offers a means of investigating complex social units, the findings of the research could be highly subjective because they are prone to bias. Another big challenge associated with research design is that information about the company will have to be obtained from a variety of primary and secondary sources, which might only provide general information about the company as opposed to information related to project management. The case study design is however, best suited for this research because of the nature of the research question and the information to be collected. Finally, the report will provide recommendations that will help to solve some of the company’s project management challenges

Literature Review

Lewis (2007, p. 22) defines a project as a temporary endeavor undertaken to produce a unique product, service, or result.” It can, however, also be considered a problem that is scheduled for a solution, and as such, it requires management knowledge, skills, tools, and techniques to achieve an effective solution. Effective project management, on the other hand, is a detailed and sequential process that entails initiating, planning, executing, monitoring, and controlling (Klastorin, 2009). This process is particularly necessitated by the fact that most, if not all, projects are constrained by various factors such as time, costs, performance, and scope requirements. In order to ensure that projects are completed successfully and within these constraints, project managers are charged with various responsibilities, including quality assurance, leadership, team building, performance management, motivation, goal setting, communication, establishing priorities, and problem solving (Kimmons, 1990, 279).

Another common characteristic of most projects is that they usually involve a wide range of stakeholders from both within and outside an organization. Each of these stakeholders has several expectations, which ultimately determine the parameters that are used in measuring the success of the project. Other stakeholders, such as suppliers and contractors, might also have a direct impact on the success of the project because they are responsible for some of the project deliverables. In a case where the entire project is outsourced to a contractor, the latter should be in a position to meet the quality standards specified by the customer.  Whenever these quality standards are compromised, the contractor should be able to identify the problems inherent in the project, contain the situation, and take the necessary measures to recover the project and regain the customer’s confidence. Other than that, the contractor should root out any practices that could cause problems in future. Like contractors, suppliers should also adhere to quality standards and ensure timely delivery of goods and services.

Projects generally fail when they are not in a position to achieve predetermined goals and objectives within a set of stipulated constraints. According to Eden et al., 2005) they fail because they are completed late, fall short of expectations, or exceed their budgets. Based on a ten-year research with partners in the European and US aerospace and defense industries Lawrence & Scanlan (2007) identified the major causes of project failure in engineering projects as poor initial planning, lack of understanding of dependencies, lack of clear objectives and deliverables, inadequate resource allocation, poor change management, poor understanding of priorities, lack of “buy-in” from stakeholders and poor risk analysis. (Lewis, 2007) further argued that the main reason behind project failure is the inability to define the problem being solved. On the other end of the spectrum, in a research that sought to elaborate on the role of project culture and systematic biases in project failures, Shore (2008,5) highlighted the critical factors for project success, which include top management support, sufficient resources, a competent project manager and team members, clear project goals, effective communication control mechanisms, and responsiveness to clients. These success factors echo the role of effective project managers, so in essence, project success relies heavily on effective project management skills.

Despite the various strategies that have over the years been adopted by companies to ensure project success, many projects especially in the field of information technology (IT) are still riddled with high failure rates. This is an indication that the current strategies and theoretical frameworks are either not sufficient to facilitate the effective management of project failure or are not being applied appropriately. Various scholars have analyzed project management and processes and proposed a number or approaches that can be adopted to ensure project success. These include the project management body of knowledge approach, the capability maturity model integration approach, the earned value management approach, and the critical success factors approach. These approaches provide a rational and consistent approach to project management, thereby enabling an organization to identify and address project challenges.  It should, however, be noted that the mere fact that an organization follows these approaches does not guarantee its success.

The most important aspect of the various project management approaches is rationality. When project managers fail to incorporate rationality in their project management decisions, they fall victim to systematic biases. Different project managers respond differently to circumstances associated with ambiguity and uncertainty owing to varying psychological processes that influence their perceptions and decisions. This could explain why project managers more often than not establish overly ambitious plans at the onset of it to realize that they are unattainable midway through the projects. According to (2008), these systematic biases include factors that distort effective decision-making, such as limited data, conservatism, groupthink, the illusion of control, overconfidence, recency, selective perception, and sunk costs.

Project failure not only generates negative publicity for the companies involved but also has far-reaching consequences for the industries and professionals related to these companies. Companies should therefore make deliberate efforts to counter project failure by addressing current challenges and formulating long-lasting solutions for

Results and Discussion

Airbus was established in 1970 as a consortium of aerospace companies that included sixteen facilities in Britain, France, Germany, and Spain, all of which were previously independently owned. The famous A380 project began in 2000, as the company made several attempts to become an integrated organization. Its management structure, however, remained convoluted even until 2006, when the company began to exhibit serious signs of project failure. The company had no choice but to put the project on hold for another two years. This would cost the company not less than six billion dollars due to its inability to meet the predetermined time constraints. The A-380 was perhaps the most ambitious project for Airbus. The aircraft was designed to mark a new era of superjumbo jets with a capacity of up to 800 passengers. However, there were red flags as early as the assembly stage, when the wiring harnesses that had been preassembled in Germany failed to fit into the airplane frames assembled in France. This mishap was caused by poor communication between the two plants. They used different versions of computer software to complete the order specifications, which were unfortunately incompatible and consequently

One of the major challenges that affected project management in the company was the fact that most managers remained loyal to their former constituents. This led to poor communication between the different plants in the individual countries. The lack of effective communication between different teams in the company could also be attributed to groupthink. Other than that, the company’s corporate managers also succumbed to the illusion of control because they believed that they had the entire organization under control, which was far from the case. Finally, the company was also affected by a lack of adequate data. The use of different software in the two plants was a clear indicator that the company’s project manager lacked adequate information about the current trends in the airline manufacturing industry.

The Airbus is not only the largest carrier in the world but also the most complicated aircraft. It is therefore only natural that it experienced a bungled conceptualization and initial production. These challenges were however not unique to the aircraft manufacturers, they also spread to the airlines that acquired the aircraft.


Decision making is the main determinant of the project’s outcome


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