Rachel Glossop is the chief executive officer (CEO) of Rush Cosmetics, a company which manufactures and sells its own brand of environmentally friendly toiletries and cosmetics. The company is the market leader in its niche market, and is one of the top ten brands in the total cosmetics market in Yorkland, where it is based.
Rachel has always been perceived by her staff as a visionary manager. However, she sometimes lets her enthusiasm for certain ideas become an obsession. She often fails to think through all the implications of her ideas and will pursue them to fruition regardless of cost. Her managers are aware of this, but are also aware that it is her vision and drive which has helped the company reach the position it is in today.
Rachel has called a meeting of managers from the information technology, production, accounting, marketing and procurement departments. The company’s business analyst has also been asked to attend the meeting. At the meeting she announced, ‘I have an idea…’, at which her managers thought about their busy schedules and inwardly groaned. ‘We’ll bring together people from all over Yorkland, get them to compete in a fun, but challenging, muddy obstacle race and turn it into a huge marketing event. We are going to host a mud run,’ she continued. ‘We’ll give away gift bags containing samples of our latest beneficial ‘mud’ skincare range and invite finishers of the race to experience an introductory treatment using our ‘sore muscle’ products.’
She emphasised that this would be a very significant marketing project and she asked Mary, the marketing manager, to be the project manager, with the other attendees at the meeting forming the project team. Amongst her list of requirements for the event were:
– An attention grabbing venue, such as the grounds of a stately home or palace
– Large display screens at the start and finish points and around the venue
– Digital timers for competitors
– Celebrity guests
– After-race entertainment, such as rock bands
– Media coverage
Before she could continue with her lengthening list of requirements, Rajesh, the production manager, asked why he had been invited to the meeting. He felt that this was purely a marketing exercise rather than a project, and suggested that the marketing department should run it just like any other marketing campaign.
Rachel replied, ‘I believe that this is a project. In fact, I’ve come up with a great name for it: we’ll call it the ‘Mud Rush’ project. It has all the characteristics of a project and it needs the full support of all of you. I’ll leave it in Mary’s capable hands, but I want regular updates.’ At which point, she left the room to attend another important meeting.
After her departure, the departmental managers discussed Rachel’s idea. Mary felt, and the others agreed, that despite Rachel’s enthusiasm, the event should still be fully justified from a business perspective and that it should be managed correctly in order to ensure its success. Rajesh stated that he was worried about negative repercussions if anyone should get injured and Mary stated that all the risks should be fully documented.
The business analyst agreed, and stated that this, and other project documentation, would be key to the success of the project and that much of this documentation should be produced during the early stages of the project.
Required:
Rachel had stated that the Mud Rush project ‘has all the characteristics of a project’.
Explain the features which make this a project and distinguish it from routine work at Rush.
The main characteristic identifying a project is the unique nature of the task and the fact that it is a step into the unknown for the company carrying out the project. It appears, although Rush has developed and grown as a company by implementing the ideas of the CEO, that ‘Mud Rush’ is a new activity for the company.
Projects need resources in order to complete them. This task would be unable to go ahead without the digital equipment mentioned, human resources to staff the race, product samples and financial resources for procurement of the venue and all other costs involved.
Whilst this may be a project for marketing purposes, it also fulfils the characteristic of requiring a cross-functional project team. The production manager will need to be involved if there is a requirement for product samples, the IT manager will need to be involved to ensure the display screens and digital timers are appropriate and working as required, the procurement manager will need to be involved for the race equipment, accounting will be needed for costing purposes and as it is to be a marketing project, that department is likely to be heavily involved.
Projects are distinct from routine day-to-day activities, and as such, have a defined end-point. This will be after the race is completed and all post-race entertainment ended, in this instance.
Projects also incorporate a number of inter-dependent tasks. For example, advertising for this event cannot go ahead until the venue has been sourced and the date of the race decidedb.
Discuss, within the context of the Mud Rush project, why each of the following documents is needed to help ensure the eventual success of the project:
(i) Project initiation document;
(ii) Business case;
(iii) Project plan;
(iv) Risk analysis.
The documentation will help to ensure success of the project as follows:
Project initiation document
The project initiation document (PID) is effectively a project charter which serves as formal communication within the project team as well as between them and other project stakeholders. If all details are documented and agreed by the parties involved, this should give a clearer view of expectations of all parties and therefore ensure that they aim to fulfil those expectations.
The PID is likely to include the following elements:
Background to the project – a brief summary of the background to the project and its importance as a marketing project; this allows the project to remain focused as it progresses.
Key dates – the start and end dates of the project will be detailed in the PID. This should ensure that Mary continues to focus on the end date when planning and executing the project. This would make her more likely to succeed in delivering the project, rather than if there was a rolling end date.
Constraints – time, cost and quality constraints will be identified and prioritised. The timing will be very important in this project as the date of the event will not be able to be delayed once set and advertised. However, the quality will also be important as there could be health and safety implications if not of a sufficient standard. Additionally, given that this is a marketing project, the budget should be set such that the costs do not outweigh the expected benefits from additional sales.
Scope – defines what will and will not be covered within the boundaries of the project. This will be very important to avoid scope ‘creep’ which may be an issue given the CEO’s enthusiasm. For example, Rachel said that after-race entertainment should be part of the project. It will be important to set the scope of this such that it does not expand into a full concert.
Project team – the PID should include details of the roles and responsibilities of team members such that each knows what is required of them during the project, especially as they are a diverse team made up of different functional managers.
Aims and objectives – this should detail the broad aim of the project as well as any specific objectives and benefits which are expected to be achieved. For example, there should be a specific objective to be achieved from a marketing perspective, rather than simply to host a race. SMART objectives should be set, such that they are able to be measured and assessed when the project is complete.
Business case
The business case details the business justification for the project. It seems that Rachel has a tendency to drive projects without necessarily considering the financial impact. The business case would deliver a cost-benefit analysis in addition to determining the feasibility of the project.
This would require predictions of cash flows and future financial benefits from Mary, along with details of any assumptions made. For example, if there is deemed to be a link between the number of runners signing up for the event and the future increase in sales revenue.
Feasibility would be considered in terms of whether sufficient resources exist (financial, human and physical), whether there is sufficient time to carry out the project and whether it fits operationally with the way that Rush works. By carrying out a feasibility study, it ensures that projects are not undertaken which are likely to fail for one of those reasons. It is at this stage when the project can still be cancelled, before the execution phase begins.
The business case would also cover how this project fits in with the overall strategic direction of the company. As Rush is known for being innovative in its approaches, this may fit in well as an innovative approach to marketing.
Project plan
Project planning can have a major impact on the success or failure of a project, and is important, both in advance of the project formally being put into action and during the execution of the project. The documentation of such a plan will ensure that all aspects of the project are set in advance, preventing the project becoming different to what it is intended to be. This may be important in Rush, given the CEO’s tendency to become obsessed with projects, and to let the ideas ‘run away with her…regardless of the cost’.
The purpose of a written project plan is to establish the appropriate project management environment required to complete the project successfully, ensuring that all resources are defined in advance, and that stakeholders are aware of what will be necessary to complete the project.
Written elements of the plan will expand upon the PID to provide the detail necessary to execute the project, and may include:
Resources – all resources, human, physical and financial, should be identified such that they can be sourced in advance and the project team can ensure that the resources are available. For example, the procurement manager will need to know all the technology required in order to ensure it is available on the day. If he is not an expert in technology, it is important to document the specifications required to ensure he sources the appropriate equipment. There should be separate resource plans for human resources, physical resources and financial resources, taking into account any constraints identified in the PID.
Product breakdown structure – this will give details of the ‘end-product’ to be delivered, in this case the actual event, and break it down into smaller activities, such that each activity can be allocated an owner, and its own resources necessary for completion. Activities for this project may include deciding the venue, designing the race course, producing the samples, etc.
The product breakdown structure may be combined with a time-planning tool, such as network diagrams or Gantt charts, to identify when activities related to each activity should be taking place.
Project quality plan – this will consider all the required standards of the different elements of the project and will include legislative standards, e.g. health and safety regulations regarding hosting a public event as well as standards set by Rush itself.
Project evaluation plan – this will clearly state how the success of the project is to be measured. For example, will it be on the overall increase in company sales or will it be restricted to the products being given away as samples and treatments during the event? Will the measurement be entirely on sales or is the success to be measured in the change in the level of brand recognition following the event?
Risk analysis
Every project and company will have individual risk factors which need to be determined in advance, in order to minimise either the impact or the likelihood of the risk occurring. Anything which could pose a risk to the project’s success should be identified, along with the likelihood of it occurring and the seriousness of the impact. The risk plan should also include ways in which these risks will be managed (avoidance, reduction, transfer or acceptance) and contingency plans should be defined should these risks actually occur during the project. For example, risks to this project may include inclement weather delaying the creation of the race course, or the actual running of the event. The likelihood of this could be minimised by creating a course which could be completed in most weather conditions, and beginning the course building with plenty of time to spare. However, the risk cannot be completely avoided and therefore the financial impact could be reduced by taking out insurance against such an occurrence.
As Rajesh pointed out, there may be a risk of injury during the race itself. Although this would not necessarily stop the race from going ahead as planned, the impact should be assessed from a company perspective: how would it affect the brand name and future sales, and would there be any financial impact, for example, compensation? The likelihood could be reduced in the design of the course, but this is unlikely to remove all risk. By determining the risk and the potential impact in advance, Rush could put appropriate contingencies in place including competitors accepting they take part at their own risk and that any injury is dealt with promptly and effectively. For example, they should ensure that a medical team is available on standby and has easy access to all areas of the course. The company should also ensure they have the appropriate insurance in place to run such an event.
By considering the risks in advance, and by documenting contingencies, the project is less likely to fail as a result of adverse or unanticipated events.