Chicago-based Vista Tower is a project for a skyscraper. Architectural Studio Gang designed the structure, and McHugh Construction is the primary builder. The project is technically 93 stories and 1414378 square feet in size. The work has been successfully completed in all phases under the direction of the Wanda Group and the Magellan Development Group, and completion is anticipated in 2020. This essay examines the plan in detail with the goal of outlining the factors that contributed to its success as well as the dangers and possibilities it may present. Projects are managed by a team set out in a charter, which identifies groups that are supposed to take on a project and highlights the specific responsibilities of the organisations. For instance, the letter can choose a team consisting of a risk manager and a steering committee (Chapman and Ward 2003, p.350).
Steering Committee
The steering committee is a committee made up of professionals from different filed s to bring together their expertise for the purpose of identifying risk mitigation techniques, implementing and monitoring the methods, and helping the senior management to be balanced.
Risk Manager
The risk manager is in charge of functions such as the risks clarification and documentation, the monitoring of risk status, risk closure process execution, maintenance and monitoring of data in the risk register and the development and implementation of the risk mitigation plan.
Project Stakeholders
The Vista Tower project is a multi-million dollar project and consequently, has many stakeholders. The key stakeholders include the suppliers, the creditors, the management and the potential buyers of the units.
Constraints of a Project
A project must face some factors, which negatively influence the development. The factors that can limit Vista Tower project are budget constraints, quality human resource constraint, and the time constraint caused by unavoidable circumstances such as poor weather conditions (Meredith and Mantel 2011, p.39).
Potential Risks Associated with the Project
Risks are cases to expose a project to the danger of being unsuccessful (Cooper 2005, p. 36). However, the absence of the predicted risks creates an opportunity for the manager to explore.
Risks that Vista Tower has faced or may face in the course of its execution:
Number
Risk
Category
Description
1
Price risk
Interest Rate Risk
The likelihood that prices of materials may rise in future.
2
Directional risk
Market risk
Marketing risk is the risk that the cost of construction can fundamentally increase because of an increase in the prices of projects in the market in general terms for instance, in the entire Chicago real estate market.
3
Demand Inflation risk
Purchasing power
This is the risk that the prices of input material may increase as a result of a rising demand of the same materials buy project developers in related construction sites making the cost of construction to rise beyond the initial estimation
4
Credit risk
Unsystematic risk
The likelihood that the cost of attaining credit could be higher than earlier anticipated due to an increase in the laws and regulations guiding the money lending institutions. For example, through the interest rate capping.
5
Model risk
Operational risk
The risk of loss during the execution of a project plan as a result of weakness in the financial model used in the management of the other dangers.
6
Political risk
Operational
The risk that political climate may make it impossible for the project to be developed such as political unrest in Chicago.
7
People risk
Operational
The risk that the company’s or the project’s employees may not follow the rules and practices developed by the project manager making the execution process difficult.
8
Legal risk
Operational
The risk that the project may not meet all the legal requirements, hence, may not be cleared by the relevant commission. Such legal requirement may include a proper plan with a backing of at least half the cost of the project.
9
Health risk
Operational risk
This is the risk that the construction environment may affect the employees and consequently halt the project plan’s execution.
10
Design risk
Technical
The risk that the project’s design is not flexible and feasible limiting the chances of the project’s success.
11
Stakeholder disengagement
Communication
The risk that the stakeholders’ expectations may not be met in the course of the project making it difficult to liaise with them. The risk may make the project to halt.
12
Procurement
Operations
This is the risk that the vendor may not deliver materials at the right time, of the correct quality and the precise quantity.
13
Change in management
Operation
The risk that the management may change before the completion of the project as a result of many factors such as death or resignation by the project developer.
Project Planning
Project planning is a part of the project management (Hans et al.2007, p.570). In planning, manager estimates the costs, materials to be used and the general outlook for the said project. The Vista planning was done by the Wanda development group and the Magellan development group. The primary material supplier for the formwork is Doka GmbH. The Vista Tower scheme was proposed and planned for in 2014 and is expected to be complete by 2020. The primary structural material used in the project is concrete with LEED Silver being the energy label. The project was planned to serve as a residential and a hotel for the United States Citizens and is, therefore, strategically located at 363 East Wacker Drive.
Figure 1. Final project of Vista Tower (Koziarz 2017).
Figure 2. Location of Vista Tower (Koziarz 2017).
Figure 3. Vista project among other big projects (Koziarz 2017).
The original plan of the project was to have all the floors above the 71st floor remain unfinished but complete and to enable owners of the floors above the penthouse to design their plans. The designed plans can allow owners to enjoy a 306-degree view of Chicago city. However, the levels between the 48th and the 70th were planned to be subdivided into four units while all the lower floors were to be divided into nine groups. The 47th floor would, upon completion of the program, host the Vista Club which would only be opened to visitors and would include a pool, a wine room, and a theatre. The whole project was estimated to cost one billion USD. The plan was approved by the Chicago Plan Commission (CPC).Apart from the general project plan; there are specific plans that were designed for the Vista residence, Vista hotel and then Vista sales Gallery.
Vista Residence
The units at Vista residence sell at a minimum of $1 million for a one bedroom for the lower floors and the price increases to about $17 million for the rooms in upper floors 92-93. The residence was designed to have four hundred and six luxury units. These units are of different sizes, according to their location. In the lower floors between 13th to 70th floors, the apartments range from one-bedroom to four-bedroom apartments with a capacity of more than 2300 feet. The stories between 71st levels to 75th contain spacious duplexes with a size of 5100 square feet. Twelve floors up are the majority of residence rooms due to the 360-degree viewpoint availability. The interior of the residence is thoughtfully and professionally furnished with four colour pallets of Topaz, Amethyst, Fluorite, and Sapphire. The residence area has many amenities, which include but not limited to a private dining room, massage rooms, wine tasting rooms, theatre, car wash, private training room, dry cleaning delivery, a twenty-four –hour attended lobby, fitness rooms, wine storage facilities, and valet garages with electric car charging facility.
The Vista Hotel
The five-star Wanda Vista hotel was planned as part of a huge project. In the initial plan drawn by the developer, the hotel was to have facilities, which include a ballroom and meeting rooms, fitness room, indoor pool, and sky bar. The other amenities include an all-day dining restaurant, one hundred and ninety-one guestrooms and a traditional Chinese tea service. It is unclear whether the Chinese tea service was inspired by the $700 million loan that the developer got from the Chinese government.
The Vista Gallery
The gallery was designed to ensure the clients’ satisfaction. The gallery has a reception area, area map, and interactive floor plan displays. A gem vault is meant to display the standard finish packages; the view room, the functioning model kitchen and the model bathroom are also included.
Having looked at the plan of the project in specifics, it is prudent to delve into the reasons for the project’s success.
Reasons for the Success of Vista Tower Project
The development of a proper project work plan is the first cause of the success of the project. The project work plan of Vista Tower did include the project overview that is, where the project would be located, the objectives which are the desired project’s accomplishments, the project’s scope which includes project’s future and the risks and assumptions as was outlined in the table. Apart from the above contents of the Vista Tower Project work plan, other contents that have contributed to the success include the proper definition of a project approach such as the source of the debt, project team's adequate organisation with a precise identification of the roles and almost accurate estimation of the project cost and duration.
Good rapport with critical stakeholders contributes to Vista Tower Project's success. A multimillion-dollar project such as the Vista Tower has many professionals working together and therefore, it is vital to have clear communication with great professionals such as engineers, architects and, the steering committee. The Vista Tower Project manager managed to engage the entire team in every phase of the project, which enabled the manager to gather many ideas and arrive at the best possible solutions.
De Wit mentions that proper vendor management has also contributed to the success of the project (1988, p. 167). A vendor is an individual or individuals who are charged with the responsibility of supplying materials to the project. In the project charter, the role of a vendor manager is to ensure that the vendor provides the correct quantity and quality of materials at the right time. There are many ways in which a vendor manager can ensure that a vendor lives up to the contract arrangement.
Firstly, the manager can impose fines on the vendor for late delivery of materials, for distribution of low-quality materials, for delivery of materials in a wrong quantity and mismanagement of a project's phase as a result of untrained employees (Duncan 1996, p.45). The fines can include a reduction in the rewards or termination of the contract. On the other hand, the manager can use motivating schemes to ensure the vendor cooperates fully with the other project team members. Such schemes can include bonus payments for quick delivery of materials and completion of a project, bonus for delivery of quality materials and a reward for the delivery of materials of the right quantity.
Proper setting of expectations has also been a reason for the success of the Vista Tower Project. Management of expectations is key in as far as the success of a project is concerned. The stakeholders such as creditors and suppliers are determined to see the project concluded as per the plan to recoup their finances. The Vista Tower, for instance, borrowed $700 million from a Chinese bank. The projects estimated date for conclusion of 2020 was set to manage such expectations (Cooke-Davies2002, p.187). As early as August 2017, the Vista Tower project opened its doors and had since sold many units. The sales are meant to start recouping money for the purpose of settling the debts. Proper management of stakeholders has enabled the project to proceed and succeed.
The other reason for the success of the project is a motivated team. The project manager should ensure the team, as designed in the project charter, is well reasoned to ensure that the members give their best professional skills to enhance the project's development. For the Vista Towers project to have succeeded, it is clear that all the team members were and still are well motivated.
The clear observation of time, budget, and quality as critical factors of a project management plan is a critical element in the ultimate project’s success. Vista Tower project was designed under a clear timeline with the year of conclusion set to be in the year 2020. The budget for the project was also clearly developed. A budget consists of the sources of finance and the areas of expenditure of the sourced funds. The proper budgeting technique enabled the project manager to source for a loan. Finally, the project quality has been observed in the construction of the tower.
Risk management is yet another critical contributor to the project’s success. The Vista Tower's project manager managed to take a proactive approach to risk management and has not been affected by the changes of costs and other risk measures outlined in the table. Risks can be classified as systematic risks and unsystematic risks. The management ought to concentrate more on the routine risks, which affect the project from within. There are three main ways of taking proactive measures. One, the project manager can retain the risks, which is called risk retention. In this method, the project manager budgets for the potential risks and in case they eventually occur, the risks can then be mitigated through the provisions of the budget. For instance, the project manager can make plans for an immediate replacement of a vendor should the current one stop the contract for one reason or another. Two, the project manager can use risk avoidance as a tool for proactively controlling the potential risks. Risk avoidance is the concept of ignoring actions that may cause a risk. For instance, the project manager can avoid hiring vendors who do not meet the minimum qualification so as to avoid the dangers of the vendor delivering materials of low quality, quality and untimely. Three, risk transfer can be a measure to mitigate risks. Risk transfer involves the shifting of potential risks to other aspects of the society in a way that the project is not affected. For example, the project manager can transfer risk by taking an insurance cover so that in case an individual is injured during the construction of the project; then the health costs are met by the hospitals and not the project management.
Finally, according to Cleland and Ireland (2006, p.20), maintenance of the projects flexibility has enabled the Vista Tower project to succeed. A project manager should be willing and ready to make changes to the project. For instance, the manager’s decision to leave the upper floors for the buyers to design according to their taste was a sign of proper project flexibility. Flexibility has many benefits to the project management such as a reduction in costs for example, if the administration identifies alternative materials at a lower cost, enhancement of quality of the project and ensuring the project team’s ideas are taken into consideration.
Conclusions and Recommendations (Executive Summary)
The project’s success or failure depends on many factors and the project developer, or the project manager must pay attention to these factors. Taking a case study of the Vista Tower Project's success, it is recommended for other project managers to ensure the teams are motivated. The project is well planned, the planning leaves room for adjustment in case of changes in estimation. The project develops a good rapport with all stakeholders by communicating efficiently and, the project manager identifies an individual to keep track the vendor or vendors in the project. The other factors that a project manager should consider to include is an approach to risk management in which case; the proactive approach should be adopted, the best possible budget for a project considering the available sources of finance and the impact of expectations' management in as far as the project management is concerned.
The research paper has delved into the background of the Vista project, the risks associated with the project, the cost of the project, the project team overseeing the project as guided by the project charter, Vista Project's images and the reasons for success. A project manager can learn many valuable project management techniques from the discussion. The lessons include the risks associated with projects, the stakeholders in a project, the types of threats that a plan may face and the methods of risk mitigation, the benefits of maintaining project's flexibility and the best practices of budgeting for a project. The paper, therefore, has elaborately explained how and why the Vista tower project can be taken as a case study for other project managers.
References
Chapman, C. and Ward, S., 2003. Project risk management: processes, techniques, and insights. Hoboken, NJ: John Wiley & Sons, Inc.
Cleland, D.L. and Ireland, L.R., 2006. Project management. New York: McGraw-Hill Professional.
Cooke-Davies, T., 2002. The “real” success factors on projects. International Journal of Project Management, 20(3), pp.185-190.
Cooper, D.F., 2005. Project risk management guidelines: managing risk in large projects and complex procurements. Hoboken, NJ: John Wiley & Sons, Inc.
De Wit, A., 1988. Measurement of project success. International Journal of Project Management, 6(3), pp.164-170.
Duncan, W.R., 1996. A guide to the project management body of knowledge. New York: PMI Communications.
Hans, E.W., Herroelen, W., Leus, R. and Wullink, G., 2007. A hierarchical approach to multi-project planning under uncertainty. Omega, 35(5), pp.563-577.
Koziarz, J., 2017. Chicago's Vista Tower: Jeanne Gang's 93-story supertall skyscraper. [Online] Available at: https://chicago.curbed.com/2016/3/30/11331246/wanda-vista-tower-condos-chicago-jeanne-gang. Accessed Nov. 9, 2017.
Meredith, J.R. and Mantel Jr, S.J., 2011. Project management: a managerial approach. Hoboken, NJ: John Wiley & Sons.
