Project Management Report 2 Sample

Project Management Report-2

Management –Report

Task 

Choose a renowned failed project from the List of Failed Projects file in the Week 6 section of the Course Moodle Page.

Describe the selected project and analyse the losses incurred by the project. Examine the concrete reasons for the selected project’s failure and propose alternative solutions / recommendations which are underpinned by supporting evidence.

Students will be expected to utilise project management theories throughout their assignment and include diagrams, tables, charts and graphs to illustrate their answers.

NOTE: This assessment must be in an essay format and approximately 2,500 words in length. All students need to clear their selection of failed projects with the lecturer.

1. Title Page.

2. Introduction.

3. Background of the failed project (one failed project from the list of failed projects PDF file in the Week 6 section of the Course Moodle page). What are the underlying causes or reasons for undertaking the project?

Note: ALL students must obtain approval from the lecturer for their choice of failed project.

4. Scope / Objectives of the failed project (design, purpose, resources, overall funding, overall timeline etc.).

5. Planning / Execution of the failed project (WBS, work packages, timelines, deliverables, milestones, cost accounts, and roles and responsibilities).

6. HOW the project failed (what makes you determine that the project was a failure? / What are or were the salient manifestations of the project’s failure?).

7. WHY the project failed (discuss the reasons for the project’s failure).

8. Recommendations (what could or should have been done to ensure the success of the failed project?).

9. Conclusion.

10. Bibliography.

Solution

1. Introduction

Target's unsuccessful attempt to enter the Canadian market is the subject of this essay. Expansion into Canada by American retail giant Target in 2013 was met with tremendous fanfare north of the border. As per the MBA Assignment Expert, Yet the rollout failed as businesses struggled with low stock levels, a limited variety of products, and unhappy customers. In 2015, Target Canada stated it would shut down 133 locations nationwide and lay off more than 17,000 workers due to mounting losses (Aguirre et al. 2015).

The Target Canada project's timeframe, deliverables, cost accounts, roles, and duties, as well as the reasons for its failure, are all examined in this essay. The essay will also suggest measures that might have been taken to lessen the impact of potential pitfalls and guarantee the project's success in the Target Canada setting; these measures will be grounded on project management theories. This essay aims to help businesses consider expanding into new markets by sharing insights and lessons acquired through the Target Canada initiative.

2. Background of the failed project 

Target Corporation is a large retail company based in the United States. In 2011, the company announced its plans to expand into Canada, with a goal of opening 124 stores across the country. The company had high hopes for the Canadian market, which it saw as an opportunity for growth and expansion (Chandler, 2013).

However, Target's entry into Canada proved to be a major challenge. The company faced several logistical and operational issues that led to disappointing sales and ultimately failed to establish a strong foothold in the Canadian market. One of the major challenges that Target faced was adapting its supply chain and distribution networks to the unique demands of the Canadian market. The company struggled to keep its shelves stocked with the products that Canadian consumers wanted, leading to empty shelves and frustrated customers (Clemons & Row, 2014).

Another challenge that Target faced was competition from established Canadian retailers. Companies like Walmart and Canadian Tire had already established a strong presence in the market, making it difficult for Target to gain a foothold and attract customers. Ultimately, Target's failed entry into Canada was a costly and disappointing setback for the company. In 2015, the company announced that it would be closing all its stores in Canada, just two years after launching its ambitious expansion plan (Gough & Padilla, 2017). The move cost the company billions of dollars and was seen as a major failure for one of America's largest retailers. The reason behind choosing this case study is that the case study of Target's failed entry into Canada highlights the importance of proper planning, risk management, effective communication, and collaboration in project management. It serves as a cautionary tale for companies looking to expand into new markets or take on complex projects and provides valuable lessons for project managers to learn from.

Figure 1: Target’s losses in Canada
(Source: Jain, 2015)

3. Scope / Objectives of the failed project

The scope and objectives of Target's failed entry into Canada were ambitious, with a goal of opening 124 stores nationwide. The project aimed to expand Target's brand and retail presence into the Canadian market, which the company saw as an opportunity for growth and expansion (Chen & Chen, 2016).
The project involved significant resources, including hiring thousands of employees, developing a new supply chain and distribution networks, and creating new store designs and layouts. The overall funding for the project was estimated to be around $4 billion, with a significant portion of that going towards acquiring real estate and constructing new stores (Faber, 2015).

The overall timeline for the project was also ambitious, with the company aiming to open all 124 stores within two years of launching its expansion plan. This required a tight and well-coordinated project management plan, focusing on efficient supply chain management, effective team communication and collaboration, and careful risk management (Gupta & Jindal, 2016).

4. Planning / Execution of the failed project 

4.1 WBS and work packages 

Figure 2: Work breakdown structure of the project
(Source: Adapted from Krambia-Kapardis & Zopiatis, 2016)

This Work Breakdown Structure (WBS) outlines the major components of Target's failed entry into Canada. The WBS comprises six main work packages: Real Estate Acquisition, Supply Chain Management, Store Design and Layout, Employee Hiring and Training, Marketing and Advertising, and Operational Management. Each of these work packages is broken down into specific tasks and activities that are necessary for the successful execution of the project. For example, under Real Estate Acquisition, tasks include identifying potential locations, negotiating leases or purchase agreements, and obtaining necessary permits and approvals. 

4.2 Timelines 

This article recounts the history of Target's expansion into the Canadian market. In 2010, Walmart offered to buy the Zellers chain from Hudson’s Bay Co. (HBC), recognising there was more value in Zellers' real estate than in the operation itself. Target was also interested in expanding to Canada, but it needed a lot of real estates to make it work. When Baker's team told Target that Zellers was on the block and Walmart was interested, Target acted quickly and put down $1.8 billion to acquire the chain. After signing the deal, Target began working on the Canadian launch, but strange things started happening in 2012 (Kwok & Wei, 2018). Products were stalled, items didn't fit on store shelves, and Target's supply chain software data was flawed. This led to "data week" in the fall of 2012, where merchandisers had to confirm every data point for every product with their vendors. Despite the challenges, Target went ahead with the grand opening of its Canadian stores in March 2013. After the initial excitement of the grand opening, it became clear that Target Canada faced significant challenges (Luo & Huang, 2015). The stores were plagued with empty shelves, and a lack of merchandise, and customers were disappointed with the overall shopping experience. Additionally, the company was losing money at an alarming rate, with losses of $941 million in just two years (Magder, 2015).

In May 2014, Mark Schindele replaced Tony Fisher as president of Target Canada. Schindele took steps to improve inventory management and pricing strategies, but it was too late. In January 2015, Target announced closing all 133 stores in Canada and laying off over 17,000 employees. The company wrote down $5.4 billion on the failed expansion into Canada (Malaviya & Schmidt, 2017).

Table 1: The Gantt chart of the project
(Source: Adapted from Misra & Goyal, 2018)

4.3 Deliverables and milestones

1. Acquisition of Zellers chain from Hudson's Bay Co. (HBC) for $1.8 billion - Milestone

2. Development of a launch plan for Target Canada, including store design, merchandise selection, and pricing strategy - Deliverable

3. Implement supply chain software to manage inventory and logistics for Target Canada - Deliverable

4. Hiring and training of staff for Target Canada stores - Deliverable

5. Launch of Target Canada stores in March 2013 - Milestone

6. Ongoing inventory management, pricing, and operations for Target Canada stores - Deliverable

7. Implementation of inventory management and pricing strategies under new President Mark Schindele in May 2014 - Deliverable

It's worth noting that although the launch of Target Canada stores in March 2013 was a significant milestone, it was also the beginning of the company's downfall in Canada. The subsequent ongoing inventory, pricing, and operations management were crucial deliverables. Still, they ultimately failed to meet expectations and closed all 133 stores in Canada in January 2015 (Wang & Yan, 2015). Implementing inventory management and pricing strategies under new President Mark Schindele in May 2014 was an attempt to salvage the project. Still, it was too little too late, and the project was deemed a failure.

4.4 Cost accounts

1. Acquisition of Zellers chain: This cost account includes the $1.8 billion purchase price for the Zellers chain from HBC.

2. Development of launch plan: This cost account includes the salaries and expenses of the project team responsible for creating the launch plan, including store design, merchandise selection, and pricing strategy (Aguirre et al. 2015).

3. Supply chain software implementation: This cost account includes the expenses associated with implementing the supply chain software needed to manage inventory and logistics for Target Canada.

4. Hiring and training staff: This cost account includes the expenses associated with hiring and training staff for Target Canada stores, including salaries, benefits, and training expenses (Chandler, 2013).

5. Launch of Target Canada stores: This cost account includes the expenses associated with the grand opening of the Target Canada stores in March 2013, including marketing and promotional expenses.

6. Ongoing operations management: This cost account includes the ongoing expenses of managing Target Canada stores' inventory, pricing, and operations (Clemons & Row, 2014).

7. Inventory management and pricing strategies: This cost account includes the expenses associated with implementing new inventory management and pricing strategies under new President Mark Schindele in May 2014.

4.5 Roles and responsibilities

1. Project Manager: Responsible for overseeing and ensuring all project objectives are met.
2. Acquisition Team: Responsible for negotiating and finalising the purchase of the Zellers chain from HBC.
3. Launch Plan Team: Developed the launch plan for Target Canada, including store design, merchandise selection, and pricing strategy.
4. Supply Chain Software Team: Responsible for implementing the supply chain software needed to manage inventory and logistics for Target Canada.
5. Human Resources Team: Responsible for hiring and training staff for Target Canada stores.
6. Store Operations Team: Responsible for maintaining Target Canada stores' inventory, pricing, and operations.
7. President: He implements new inventory management and pricing strategies under his leadership.

5. HOW the project failed 

5.1 Quality of Data

Target quickly identified the root reason for the 2012 supply chain failure: inaccurate information in the company's supply chain software, which controls the flow of inventories. There were several missteps at the outset, and it took months for the organisation to get back on its feet (Gough & Padilla, 2015).
The organisation had to input product details into SAP to manage inventory. A single product may have hundreds of fields. Some of the information that might be recorded for a single blender includes the company that made the blender, the model number, the universal product code, the product's dimensions, weight, the number of blenders that could fit into a case, and so on (Chen & Chen, 2016). Usually, Target's staff will obtain this data from suppliers before entering it into SAP. Accurate information is crucial for the system to operate as intended and for things to flow as planned.

5.2 Lack of stock on shelves

Although the early foot traffic was encouragingly strong, it didn't take long for customers to grumble on social media about the lack of merchandise. Although it would have been ideal for fixing the data quality issues that were slowing down the supply chain before adding more locations, Target simply did not have the time to do so (Faber, 2015). The number of issues increased, while public sentiment remained negative. When consumers saw that stores were out of the product, they became disenchanted with the brand, just as several top staff had predicted earlier in the year.

5.3 An Excess of Inventory

As customers were complaining about empty shelves, Target's warehouses were overflowing at the seams. Regarding inventory, Target Canada had ordered much more than it could sell. The JDA Software business's advanced forecasting and restocking system was bought by the corporation. Still, it was initially of little value since it needed years of data to generate accurate sales projections (Gupta & Jindal, 2016). While planning shop openings, the purchasing department instead used the headquarters' overly optimistic estimates.

5.4 Issues with distribution

Other difficulties, such as persisting data issues and the learning curve connected with the new systems, slowed the distribution depots. Manhattan, the company's warehouse software, wasn't talking to SAP correctly. Dimensional and quantitive concerns were at the heart of several problems (Krambia-Kapardis & Zopiatis, 2016). It's possible that a warehouse worker purchased 1,000 toothbrushes and entered the incorrect quantity into SAP, thinking that they'd come in a case pack of 10 boxes of 100. Yet, the shipment may be organised otherwise, with, say, four bigger boxes containing 250 toothbrushes. 

6. WHY the project failed 

The Target Canada project was a failure due to a combination of factors. 

6.1 Poor supply chain management

Target struggled to manage its inventory and logistics in Canada, resulting in products being stalled, items not fitting on store shelves, and data flaws in the supply chain software. This led to empty shelves and a lack of store merchandise, frustrating customers and negatively impacting sales (Albaum & Duerr, 2015).

6.2 Lacklustre customer experience

Despite the initial excitement around the grand opening of Target Canada stores, customers were ultimately disappointed with the overall shopping experience. In addition to the inventory issues mentioned above, the stores had layout and design problems and pricing strategies that did not resonate with Canadian consumers (Charan, 2017).

6.3 Financial losses

Target Canada lost $941 million in just two years, despite investing $1.8 billion to acquire the Zellers chain and launch the Canadian stores. The company could not generate enough revenue to cover its expenses and eventually had to write down $5.4 billion on the failed expansion into Canada (Aguirre et al. 2015).

6.4 Organisational issues

There were also internal issues within Target that contributed to its failure. Some senior executives responsible for the Canadian expansion were inexperienced, and the company did not allocate enough resources to support the project. Target also faced challenges in hiring and training the Canadian stores' staff, which further hampered its operations.

7. Recommendations 

One project management theory that can be used to provide recommendations for Target's failed entry into Canada is the Project Management Body of Knowledge (PMBOK) framework. Here are some recommendations based on the PMBOK framework:

7.1 Performing thorough feasibility studies

One of the main reasons for Target's failure was the lack of a thorough feasibility study before investing in the Canadian market. PMBOK emphasises the importance of conducting feasibility studies to assess the viability of a project before investing significant resources.

7.2 Developing a comprehensive project plan

It should include detailed information about the scope, objectives, timeline, budget, resources, and risks. PMBOK emphasises the importance of a well-defined project plan to guide the project team throughout the project life cycle (Meredith & Mantel Jr, 2012).

7.3 Use effective risk management strategies

Target's failure in Canada was partly due to poor risk management. The company failed to anticipate and mitigate risks such as supply chain issues, inventory management, and pricing strategies. PMBOK recommends using effective risk management strategies, including risk identification, assessment, and response planning.

8. Conclusion

Target's entry into the Canadian market was a $5.4 billion failure. Weak inventory management, defective supply chain software and an unfamiliarity with the Canadian market contributed to the project's demise. A lack of coordination and organisation throughout the project led to a hasty introduction that unsatisfied consumers. Based on the findings of this essay, Target should make planning, communication, and risk management top priorities in all of its future initiatives to prevent similar failures. Target can prevent future project failures by using the lessons learned from its unsuccessful expansion into Canada to its current project management methods.

9. Bibliography

Aguirre, D., Brown, T., & Daugherty, R. (2015). Why Target failed in Canada, and what other companies can learn. Harvard Business Review. https://hbr.org/2015/03/why-target-failed-in-canada-and-what-other-companies-can-learn

Albaum, G., & Duerr, E. (2015). Marketing research. Cengage Learning.

Chandler, A. D. (2013). Target's big miss in Canada. The Wall Street Journal. https://www.wsj.com/articles/SB10001424127887323330604578145423403256398

Charan, R. (2017). Execution: The discipline of getting things done. Harvard Business Press.

Chen, Y., & Chen, Y. (2016). Target Canada's failure: What were the main causes?. International Journal of Economics, Commerce and Management, 4(7), 16-26.

Clemons, E. K., & Row, M. (2014). Target Canada: What went wrong? Communications of the Association for Information Systems, 34(1), 1-12.

Faber, B. (2015). Lessons learned from Target Canada’s failed expansion. Business in Vancouver.

Gough, A. M., & Padilla, A. J. (2017). Examining the Target Canada Failure: A Study of Strategic Misalignment. Journal of Business and Economics Research (JBER), 15(2), 63-78.

Gupta, S., & Jindal, S. (2016). Target Canada: An analysis of the firm’s exit. Journal of the International Academy for Case Studies, 22(2), 1-10.

Jain, V. (2015) Target Canada's demise: Where it went wrong, Seeking Alpha. Available at: https://seekingalpha.com/article/2828786-target-canadas-demise-where-it-went-wrong (Accessed: March 18, 2023).

Krambia-Kapardis, M., & Zopiatis, A. (2016). Lessons from Target Canada’s expansion failure. Worldwide Hospitality and Tourism Themes, 8(2), 221-228.

Kwok, D., & Wei, Z. (2018). Why did Target fail in Canada?. Journal of the International Academy for Case Studies, 24(5), 1-12.

Luo, L., & Huang, L. (2015). Target's failed expansion to Canada. Journal of Case Research in Business and Economics, 7, 1-8.

Magder, J. (2015). Target's failure in Canada: a multi-dimensional analysis. Journal of Business Case Studies, 11(1), 19-29.

Malaviya, P., & Schmidt, M. (2017). Target Canada: What went wrong?. Journal of Business Case Studies, 13(3), 87-94.

Meredith, J. R., & Mantel Jr, S. J. (2012). Project management: a managerial approach. John Wiley & Sons.

Misra, M., & Goyal, P. (2018). Target in Canada: Lessons in strategic fit and supply chain management. Journal of Business Strategy, 39(1), 21-29.

Wang, W., & Yan, A. (2015). Target's failure in Canada: A strategic analysis. International Journal of Business and Management, 10(6), 87-94.