Bae Case Study

Part 1: Executive Summary:

As Gene Di Fonso my recommendation will be to modify the contract for installing the baggage- handling systems. Gene has to work on improving the relationship with the city. This will create an atmosphere to be able to negotiate the modification instead of litigation. BAE had not thought this through initially because they saw this contract as an opportunity to grow and have the experience in baggage installation and be able to be a leader in the market. They believed this will look well on their resume. BAE should install this automated baggage system in United first on a smaller scale and see the testing through before going on a larger scale.

Gene knew that with the complex nature of what the city had asked they will need time and based on the technology to be used for such a system the decision had to be made earlier in the project. And Gene needed to communicate to city that even though they had the technology developed its implementation in a complex project like this would require significant greater time than the city had left available.

Gene has to negotiate a modified contract with city that will state a clear scope of work, scope change process, timeline , resources needed, one point of communication, organization chart, how to track scope changes, priority of each step of the projection. This decisions has to be well communicated by BAE this time so that city can understand that the success of the project depends on all these elements.

Based on all the problems that led to the delay of the opening of the airport BAE should not be paying the $12,000-a-day -penalty and also the $50million for conventional tug-and-cart baggage system. Gene could demonstrate that flaws in the overall design of the airport and an unsystematic approach to project changes had affected implementation of the integrated baggage system.

I. Process Elements/ Table of contents (Part 2) Page

Part 1 Executive Summary

Part 2 Table of Contents

Part 3 Introduction/ Background

II. Issue with Impact Analysis

Part 4 Immediate Issue

Part 5 Systematic Issues

III. Environmental & Root Cause Analysi

Part 6 Qualitative Analysis

Part 7 Quantitative Analysis

IV. Alternatives and or Options

Part 8 Alternatives

V. Recommendations

Part 9 List of Recommendations

VI. Recommendation Implementation plan

Part 10 Implementation Plan

VII. Monitor & Control

Part 11 Monitor and Control

Part 12 Conclusion & Management Plan

Part 3 Introduction / Background

In November 1989 ground was broken to build Denver International Airport(DIA). Located 25 miles from downtown Denver, Colorado, it was the first major airport to be built in the United States since the opening of the Dallas-Fort Worth Airport in 1974. In 1992, two years into construction, the project's top managers recommended inclusion of an airport-wide integrated baggage-handling system that could dramatically improve the efficiency of luggage delivery.

BAE was founded as a division of Docutel Corporation in 1968. Docutel, which had developed the Telecar (a track-mounted automated baggage system), constructed an automated baggage system for United Airlines at San Francisco airport in 1978. When Docutel ran into financial difficulties during this installation, United asked Boeing, a major supplier of its aircraft, to take over the company. Boeing agreed and the new company, a wholly-owned subsidiary dubbed Boeing Airport Equipment, completed the San Francisco installation. In 1982, Boeing sold the company to its senior management, which renamed it BAE Automated Systems.

BAE was originally contracted by United Airlines to cover its operations, the system was to be expected to serve the entire airport. It was expected that the integrated system would improve ground time efficiency, reduce close-out time for hub operations, and decrease time-consuming manual baggage sorting and handling. There were, however, a number of risks inherent in the endeavour: the scale of the large project size, the enormous complexity of the expanded system; the newness of the technology; the large number of resident entities to be served at the same system; the high degree of technical and project definition uncertainty; and the short time span for completion. Due to its significant experience implementing baggage -handling technology on a smaller scale, BAE Automated Systems Inc. and engineering consulting and manufacturing company based in Carollton, Texas, was awarded the contract.

II. Issue with impact Analysis

Part 4 Immediate Issue

The main issue was construction problems that kept the new airport from opening on the originally scheduled opening date of October 1993. Subsequently, problems with the implementation of the baggage system forced delays in the opening of the airport another three times in seven months.

Part 5 Systematic Issues

Logplan issued an 11-page report to the city of Denver that even though BAE had a system

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