McDonald’s is one of the leading global food service retailers that have over 36000 restaurants across the world. The company strives to provide quality services to its customers and thus the company had decided to digitalize their operation in order to enhance the customized ordering experiences of the customers (Mcdonalds.com. 2017). Thus the project Innovate was proposed, which was planned to provide a worldwide digital network and ERP system.
The project cost of Innovate was around $1 billion, which was one of the expensive information technology projects by McDonalds. However, this project failed even before it could be launched due to certain issues that were faced while implementing this project. The report discusses the issues encountered in the project and the discussion about different tools and techniques from PMBOK to improve the chances of project success (Snyder 2014).
2. The Project Innovate
The project Innovate undertaken by McDonalds was one of the most expensive information technology projects. It aimed in creating an information system or enterprise resource planning system of real time global network that would link all its 30000 stores in 121 countries. The system was to be designed in such a manner so that it was able to collect the real time information from every store and would deliver to the headquarters’ executives as well. The project was mainly undertaken with an aim of increasing the efficiency and consistency of the daily operation and to have a real time monitoring system of the services that are being offered in every outlet of McDonalds. The project was huge and the complexity level of the project was high as well. The project however, could not succeed due to the improper project implementation.
3. Issues Encountered in the project
3.1. Project Problems
The major problems that were identified while implementing the project innovate are as follows-
- The company and the project management team had no experience in the field of large-scale software integration and software implementation, which was one of the major reasons of the project failure (Baselinemag.com. 2017).
- The budget set for the project could only cover the project implementation. Millions more would have been required for the maintenance of the system.
- Another major problem with the project was selection of proper project methodology that was required for successful implementation of the project. The big bang approach that was undertaken for implementing the project was not appropriate.
- Lack of executive leadership was another reason of the project failure. The project implementation lacked proper senior management that has a huge effect on project implementation.
- The project scope was not properly identified, which was one of the major reasons of improper budget estimation and project failure.
- The project manager was not much experienced and therefore, it was difficult for him to manage such a huge project. The project team members or the executives had no proper understanding of the information technology requirements and the project was largely based on unrealistic expectations.
3.2. Major Causes of the Project Discontinuation
The project innovate failed mainly due to the following reasons (Baselinemag.com. 2017)-
- Lack of proper ownership to the project is a major reason of project failure. The key deliverables of the project was not properly identified in the project scope.
- Poor communication is another major reason of discontinuation of project Innovate. Lack of proper communication largely contributed to the project failure. Objectives of the project were not clear to the stakeholders, which resulted in the lack of clear directions on the roles and responsibilities of the project team members. Project briefing is an essential aspect of project management, which helps in properly conducting the project objectives and the responsibilities of the project team members across the entire project management team. The project charter has narrow scope identification, which was another major reason of the project failure.
- The project management team was not competent enough to translate the different strategies identified for the project into structure. Lack of strategic approach in project management contributed much to the project failure.
- The big bang approach used for implementation of project innovate was not appropriate. Considering the size of the project, it could have been better if the project was divided into a number of phases. The phases of the project development further needed to be interlinked, that is completion of a particular phase should mark the beginning of the next phase.
- McDonalds was inexperienced in large scale information system implementation. Moreover, on that time, high-speed internet was not present everywhere, which was one of the primary requirement of the system to be developed. Lack of robust and affordable infrastructure is therefore a reason of the discontinuation of the project.
- Another reason identified for the project discontinuation was that the managers of the existing restaurants were resistant to the change. The real time monitoring of the entire processes and the systems were a major reason for that.
4. Tools and Techniques for improving the Project Success
The different tools and techniques from the PMBOK that could have been used in order to improve the chances of project success are as follows (Baselinemag.com. 2017)-
- One of the major issues identified for the discontinuation of the project innovate is improper scope identification of the project. This could have been avoided if a proper project charter was built at the project initiation phase. The Project charter is an effective tool of project management, which refers to the statement of objectives of a project. This tool helps in setting up a detailed project goal along with the roles and responsibilities of the main stakeholders along with the level of authority of the project manager appointed for the project. A project charter could further help in providing a preliminary delineation in the roles and responsibilities outlining the project objectives. If this tool of project management was properly implemented, it could have eliminated the problem of improper scope management of the project (Schwalbe 2015).
- Another major reason of the project failure is the weak communication along the team members. Improper communication among the project team members resulted in unclear project objective and hence the project could not be implemented in a planned approach. This could have been avoided by making use of a proper project communication plan. Communication plan defines the methods, time and process of the communication that should be followed throughout the project implementation phase. A proper project communication plan ensures that the updates and the modification done in the project are rightly communicated among the team members (Pritchard 2013). This could have further eliminated the problem of improper scope management of the project. A project plan specifies the communication channels should be used to connect to a particular stakeholder and therefore ensures proactive delivery of the information.
- The budget identified for the project was incorrect, as it did not include the maintenance cost of the system. This was another major reason for the discontinuation of the project. Proper cost estimation technique was needed to be implemented in order to eliminate the problems. Cost benefit analysis of a project is one major tools that is mentioned in PMBOK and can be implemented for proper cost estimation of the project (Fleming and Koppelman 2016).
- Use of Gantt charts for defining the proper schedule of the different phases of project management was essential for monitoring the progress of the project innovate (Larson and Gray 2013).
- It is essential to identify the risks associated with the project at the project initiation phase as it helps in eliminating the occurrence of such risks in the project implementation. The project innovate had to be discontinued and one of the major reason is lack of proper risk mitigation techniques. Risk management is an essential tool that largely contributes to the project success. Quantitative risk analysis, which includes evaluation of the cost, schedule and budget is essential for successful implementation of a project, which could have helped the project innovate as well.
- Furthermore, it is essential for the project to go through the critical path analysis, which is another effective tool of project management. The critical path analysis evaluates the major or critical path of the project that improves the project implementation. The critical path analysis helps in identifying the interrelation between the different tasks and activities. Proper resource management further needs critical path analysis.
- Monitoring and controlling the project progress is another significant tools of project management. It helps in evaluating whether the said project is moving onto the right track. Project Innovate lacked proper project monitoring and control, which was one of the major reasons of over spending in the project leading to the project closure (Kerzner 2013).
PMBOK mentions the use of many different tools and techniques that contributes positively to the project progress. Schedule planning, PERT time estimate, financial planning, and resource planning and so on that contributes positively to the project. Implementation of a proper project management methodology could have helped in successful completion of the project, saving the organization from a huge loss. The project was complex and the McDonalds was trying to implement too many things in a very restricted time with incorrect methodology. A proper planning of the project was needed in order to implement it in a strategic manner, which was missing in this case and was a huge reason of the project failure.
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Kerzner, H., 2013. Project management: a systems approach to planning, scheduling, and controlling. John Wiley & Sons.
Larson, E.W. and Gray, C., 2013. Project Management: The Managerial Process with MS Project. McGraw-Hill.
Mcdonalds.com. 2017. About Us: McDonald’s Story, Facts & Information | McDonald’s. [online] Available at: https://www.mcdonalds.com/us/en-us/about-us.html [Accessed 5 Dec. 2017].
Pritchard, C., 2013. The project management communications toolkit. Artech House.
Schwalbe, K., 2015. Information technology project management. Cengage Learning.
Snyder, C.S., 2014. A Guide to the Project Management Body of Knowledge: PMBOK (®) Guide. Project Management Institute.