A Focus on Performance Metrics and Risk Management

Introduction

The ideal of project management, especially in the context of events has evolved greatly over the past few decades. The emphasis of this section is on performance management performance metrics. Recent concepts of performance go beyond the conventional "iron triangle" exchanges or trade-offs between expense, which is budget, time, which is schedule, and quality, which is specification, with theorists emphasising the overarching need to meet the standards of key project participants (Atkinson, 1999; Tukel and Rom, 2001). Another important aspect which needs to be considered in recent projects is the concept of risk management of the project and its frameworks. In organisations where risk management is well applied, more projects achieve their goals, by using a combined success metric for schedule and budget of the particular project (Hilson and Simon, 2020). Regrettably, despite evidence that risk management has a significant impact on project performance, Cooke-Davies (2002) found that risk management has the lowest score of all project management strategies in terms of successful execution and usage, implying that although many companies understand the value and importance of risk management, they are not successfully implementing it.

The purpose of this report is to investigate into the concept of project and risk assessment by taking into context the London Olympics, which were organised in the city of London in the summer season in 2012. The report will look at the available literature on the organisation and functioning of the event and attempt to understand how effectively it managed its functions and how it managed the risks associated with the project. The project will also rely on the existing reports and literature in order to understand if the project could be understood as a success; this will be done by assessing the project triangle, i.e; the cost, quality and time which went into the making of the project to understand if resource allocation was done adequately or not. Lastly, this report will be looking into what were the risks which were associated with the project and whether they were managed in an effective manner or not.

Project and Risk Management: The Context of London Olympics and Paralympics

The 2012 Summer Olympics was held from the 27th July to the 12th August, where 302 events took place and 204 countries participated. The games took place in the Olympic Park in London .The Park attracted up to 180,000 fans a day, making it the primary focus of Olympic sport. The Olympic Stadium, Aquatics Centre, Velodrome, and BMX Circuit, and also the hockey, handball, and basketball arenas, were all easy to access through the Park's system of footbridges and walkways (olympic.org).

Organisation and Stakeholders

The organising body for the games was the London Organising Committee for the Olympic Games and Paralympic Games (LOCOG), and they were assisted by the Olympic Delivery Authority (ODA). The first steps involved quick appointments to the committees of LOCOG and ODA and the approval of the outline planning permissions of the Olympic Park and its venues, which took place in 2005-2006. The next years till 2012 constituted in designing and launching the emblem of the games, finalising and partnering with the three major commercial partners of the Olympics and Paralympics, which were Lloyd TSB, EDF Energy and Adidas and the Transport Plan and Masterplan for the event was finalised (London Organising Committee of the Olympic Games and Paralympic Games Progress report, 2012). With regards to the budget of the event, Hugh Robertson, the sports minister, had revealed the government's last quarterly budget report, announcing that the final cost of the Games would be £8.921 billion. Initially, the budget of the games were billed around £9.28 billion. However, Olympic organisers admitted that about £1 billion in public funds had been redirected to the organising committee, Locog, for sections of the task (Gibson, 2012).

Analysing the Event: Successes and Failures and their Organisational Causes

By the above analysis, it is clear that there was extensive planning involved in the project and the management system was based on some clear guidelines which were dictated by committees. This section will look into the event in an evaluative fashion, in an attempt to understand if there were any possible areas of improvement for the event, what were the successful factors of the event and in what areas it needed improvement.

The success of the London 2012 Olympics could be assessed in a variety of ways, including ticket sales, sport quality, transportation operations that met all demands, and personnel security that ensured no accidents disrupted the Games. The 2012 London Olympic and Paralympic Games were hailed as a huge success by all observers and became a model for later events in sports (Williams, 2019). The government minister in charge of the Games was Tessa Jowell. With regards to the organisation of the event, she has claimed that the government would achieve success for the Games by the mechanism of task delegation to the world experts rather than micromanaging the building. The Olympic Delivery Authority's (ODA) Simon Wright added that it's too early to draw any conclusions, but stressed the overall aim of improving athletic facilities throughout the UK (Dodd and Sathsivam, 2010).

The effect of a sporting event in the general public of the nation can be attributed to as positive if it encourages the people to adopt a more athletic and healthier lifestyle in general. In 2012, the UK was the site for two big sporting events, the UEFA Championship and the Olympics and Paralympics. The results of sporting activities can be classified into two categories: observable and intangible. Attending the function in person, being in the audience, travelling to the location, and investing money in the city are all examples of the tangible part. This aspect has been extensively researched in previous economic impact studies (Coleman, 2006). Sporting achievement can instil a positive attitude in the public, as well as feelings of cultural and civic pride. It also has a cohesive aspect because it can promote local and national solidarity as well as national unity (Forrest and Simmons, 2003; Allsion and Monnigton, 2002; Sussmuth et al, 2010). An important measure that can be used to measure the success of the event is the customer’s Willingness-to-Pay or WTP. A study, looking at the 2012 Summer Olympics in the city of London, a theoretical situation involving a monetary contribution from each family to fund this programme was posed to the participants of a survey conducted before and after the Games. The results revealed that the Before the Olympics, the WTP per household was $44.96 compared to $91.42 for the WTP measured after the Olympics. Hence, from a financial point of view, the event was a success (Wicker and Hallman, 2012).

Risk Management and Success of the 2012 Olympics

The success of the event lay mostly on the methods and mechanisms which were followed in order to handle the three aspects of this project, namely cost, time and quality. The government hired a professional recruitment manager from the start to find key people with proven big project experience and knowledge of the commercial and financial aspects of large projects. A strong understanding of the correlation between benefit and cost, as well as individuals with a can-do mindset who were industrious, were sought as defining qualities. The Department of Culture, Media, and Sport, through its Government Olympic Executive, was given responsibility for leading the public sector funding package (GOE) (Williams, 2019). However, the objective of the event was not just the hosting of the event. The ODA cleaned up a square mile of land polluted by toxic industrial waste and abandoned rubble (and the occasional ordnance) from the Blitz, started the process of burying power lines, and built 200 acres (80 hectares) of new parkland at the East London site. The objective was to make a refurbished East London area and without bankrupting the city, like it happened to Montreal during 1974. The total cost of organising the event was 14.9 billion dollars (Newman, 2014). This wasn’t an isolated inquiry as others also spoke of the the Olympic’s lasting effect on the quality of service in the construction industry of London thereafter. The 2012 Olympics were centred on values, maybe none more so than the need to leave a legacy. Companies were judged on how closely their ideals matched those of the Olympic Games. Many of the construction projects plans were made public so that businesses could see how their work fit into the larger picture of the Stratford Olympic Park. There was also a race to see who could finish the projects the fastest, in order to save time (Fennell, 2019).

In a 2016 survey by Dehe and Bamford on the quality of services which were provided by the 2012 Olympics, all of the theme evaluations received a high score, indicating that respondents were generally pleased with the procedures, programmes, and facilities offered during the London 2012 Paralympic Games. However, the most crucial areas did not receive the highest marks. Volunteers and the other employees, Events, Medical and Healthcare, and Arrivals and Departures were the four most productive events. Interestingly, the athletes classified the Paralympics village, Performance locations, Transportation, and Hospitality as the most significant and relevant, despite the fact that none of these were deemed essential by the players. All of these significant requirements were items with which the athletes had immediate, frequent, and significant experience. However, in terms of the relative results, these were not the highest. The most critical parameters for actual results were ranked fifth, seventh, sixth, and eighth, respectively. Hence, there is a relative gap between what was understood to be the most important functions in the event versus what realistically was the most important functions in the event.

Conclusion

The use of a purpose-built delivery model with clear governance underpins the success of Olympic Park and the Games. The diligent GOE team, headed by specially recruited personnel, was at the heart of this. Specialised people were often hired by the distribution organisations. It was important to acknowledge remuneration above context standards for senior positions in order to attract the right people (Williams, 2019). These are some of the reasons for the relative success of the 2012 Olympics held in London. It also significantly enjoyed support from the local populations an in a phase of the bid assessment, London Olympics 2012 was not the standout in local popularity contest, with only New York ahead of it. However, the solidarity and contingency of popular opinion pose a political danger to the government and organisers. In December 2002, when faced with an expense of £1.8 billion that would be recouped if the Olympics were a success, 65 percent of the General populace of England agreed that London 2012 was worth the expense investment (Jennings, 2008). Hence, it enjoyed popular support much longer before it started.

Recommendations

If the games are a big driver of urban development in the cities that they operate in, they could also be causes for bankruptcy, as we have witnessed before. This is an excellent opportunity to learn new skills and educate the local workforce in their application. Indeed, project management skills have been identified as a critical skill in a way that has never been seen before, not just in the building industry but also in a variety of other sectors.

References

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Dig deeper into A Focus on NMC Value with our selection of articles.

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Hillson, D. and Simon, P., 2020. Practical project risk management: The ATOM methodology. Berrett-Koehler Publishers.

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