SST101: The queen announced to a select audience at the ribbon-cutting ceremony for Terminal 5 in London: Principles of Project Management Case Study, SUSS, Singapore

The queen announced to a select audience at the ribbon-cutting ceremony for Terminal 5 in London. Heathrow Airport, “It gives me great pleasure to open Terminal 5-the 21st-century gateway to Britain and, to us, the wider world.”

At the cost of over $5 billion British Always (BA) was banking on Terminal 5 eliminating what had

commonly been called the ‘Heathrow hassle.Over the past decade Heathrow had named reputation forbaggage delays, long queues, and lost luggage, so much so that premium passengers were avoiding landing there and paying extra to land in ultra-modern hubs, like Amsterdam and Frankfurt.

Terminal 5 was designed by a world-famous architect and featured sweeping views of London; wide, open spaces; and rows of luxury shops, including Tiffany’s and a Gordon Ramsey restaurant. It was designed to handle30 million customers a year with state-of-the-art departure lounges. It Included a sophisticated baggage setup designed to handle 12,000 bags per hour and eliminate the Heathrow hassle.

March 28, the opening day of the terminal, started ominously. The first warning came at 4:00 a.m. when many of the staff and passengers began showing up late because they could not find parking. The road signs outside the terminal were not clear, and people said they were given the wrong information once inside. Once the staff arrived at work, many were unable to log in to the computer system due to inadequate training. As a result, the processing of passengers began to bog down, and the luggage began to stack up. Technical glitches with the baggage system emerged. An underground conveyor system became clogged up. By noon, BA had had to cancel 20 flights. By5:00 p.m., BA had suspended the checking-in of all luggage. This meant passengers at the airport had the choice of flying with just hand baggage, getting an alternative flight, or claiming a refund. Of all the planes that left that day, one in three had no luggage

That was only day 1; flights were canceled all week and BA brought in hundreds of volunteers to tackle the baggage mountain. In the end, over 28,000 suitcases were shipped to Milan, where they were sorted out away from the turmoil in London.

The opening of Terminal 5 was an embarrassment, with hundreds of canceled flights and thousands of lost bags. It cost BA over $32 million and two senior executives their jobs. BA later admitted that customers were deserting in wake of the Terminal 5 fiasco, with passenger numbers down 7 percent.

What are the lessons to be learned? There are many. The first is that on complex projects there is a tendency to focus on the technical challenges and shortchange the human side of the project. Remember, projects are socio-technical systems! A more robust RBS may have revealed the need for more training and a walk-through before the terminal became operational. One also must question the wisdom of going fully operational on day 1. Going from operating zero flights one day to 380 is a formidable task. A more prudent approach may have been to limit the flights the first week to work out the kinks and ensure success.