User involvement & ownership:

Have the various potential users been identified and represented?

How involved were these groups in the formulation of the project?

Are these groups actively participating in the project implementation?

Smaller project milestones:

Does the project plan include critical tasks, dependencies, task owners, and milestones to ensure staying on track?

Have the potential project bottlenecks been identified?

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Harvest City: The Intelligent Procurement System

Project

What could be worse than wasting millions of dollars in overpriced procured products and services? Installing a $26 million intelligent procurement solution to help transform procurement . . . and failing in the process! In February 2017, Bill Miller, the CEO of Venso, an IT system design startup based in Californias Silicon Valley, read through the legal document on his desk one more time, then reached for the phone to call the companys lawyer. The letter had been sent by the lawyers of his client, the Harvest City Convention Center, and named Venso as responsible for the delay in the centers opening. It assessed Venso a $5,000-per-day penalty for the IT system failure. It also conveyed a message from Harvest Citys mayor, Andrew Thompson, demanding that Venso pay the $1.25 million cost of implementing an alternative, conventional procurement system for each convention center tenant.

Miller felt that Venso could demonstrate that flaws in the overall design of the Harvest City complex and an unsystematic approach to project changes had delayed the implementation of Vensos intelligent procurement system. He debated whether he should just cancel the contractworth $26 millionand cut his losses, or work with his lawyers to negotiate with Thompson and the convention center executives for the support required to finish the system as specified, despite the deterioration in communication and rising hostility between the various parties. He also wondered how the situation had gotten to this point.

Building the Most Modern Convention Complex in the U.S. Midwest

In 2009, the city council members in a growing U.S. midwestern city began to consider how they could market the city as a global destination for business travel, while also providing local citizens with a modern, prestigious gathering place. Consequently, they voted to approve the construction of a downtown convention center. In 2010, Mayor Thompson assembled a citizens task force to select a developer. The task force including representatives from the hospitality, tourism, labor, environment, and architectural industriesrecommended the creation of the Harvest City Convention Complex Corporation (Harvest City Corporation) as a public benefit corporation to finalize the scope and cost of the proposed complex, work with the primary stakeholders to identify the revenue and financing necessary to bring it to fruition, and then exclusively manage, market, and operate the new facility.

In 2012, Thompson hired John Casper as the CEO of the new corporation. With 20 years experience running a convention complex in the eastern United States and several awards to his name, To prepare for his role at Harvest City, Casper attended leading trade shows, meeting with potential clients that would sign on to open hotels, stores, restaurants, and other hospitality venues. He also handpicked each member of his leadership team so he could find individuals who shared his passion for the hospitality industry and for delivering unsurpassed service. In September 2012, Thompson and the major stakeholders signed an agreement to receive a $60 million grant for the new complex, which was to be financed by revenue bonds and federal grants, supplemented by a sizable investment from the city.

Harvest City Reaches for the Cloud

In July 2015, Casper learned of the hotels contract with Venso for the development of intelligent procurement system. Until then, it was assumed that each Harvest City tenant would develop its own procurement system. Casper believed that providing a convention centerwide intelligent procurement system could provide value in supporting each tenant while enabling Harvest Citys management to create unprecedented visibility into the consumption patterns of all purchases (including money spent on people and labor).

After several meetings, Casper persuaded Miller to reconsider Vensos position. In November 2015, Miller and Casper signed a $26 million contract to develop a best-in-class cloud- and IoT-based procurement system to facilitate the procurement of direct and indirect items for all tenants. This phase of the project would be implemented and tested by November 1, 2016in time for the grand opening of the hotel and convention center in January 2017. A separate contract would be negotiated during summer 2016 for the second phase of the Harvest City project. This manager had not overseen the integration of a procurement system. The contract specified that Venso would: (a) design the intelligent procurement system; (b) install the mechanical sensor components; (c) program the logic and sensor controls; and (d) design and develop the realtime, process-control software to manage the intelligent system. The contract also specified that Venso would have the right of first refusal to bid on operating the intelligent procurement system for the Harvest City Convention Center and the Hotel at Harvest City once the facility was opened in January 2017. A month later, in December 2015, Casper resigned due to illness. Instead of hiring a new CEO, Harvest City Corporation divided Caspers responsibilities among the remaining executive team members, who reported to the Board of Directors. Implementing the Venso Contract The day after Caspers resignation, Venso employees had to stop working when a building inspector deemed their work area unsafe. Miller commented, Our pleas to Harvest City Corporations executives to assure our ability to continue work were not acknowledged. Miller sent an email to the manager overseeing Vensos work, stating that Venso would not accept the request for the changes to the procurement sorting subsystem. Vensos relationship with Harvest City Corporations leadership continued to worsen.

Building the Most Modern Convention Complex in the U.S. Midwest

In 2009, the city council members in a growing U.S. midwestern city began to consider how they could market the city as a global destination for business travel, while also providing local citizens with a modern, prestigious gathering place. Consequently, they voted to approve the construction of a downtown convention center. In 2010, Mayor Thompson assembled a citizens task force to select a developer. The task force including representatives from the hospitality, tourism, labor, environment, and architectural industriesrecommended the creation of the Harvest City Convention Complex Corporation (Harvest City Corporation) as a public benefit corporationa to finalize the scope and cost of the proposed complex, work with the primary stakeholders to identify the revenue and financing necessary to bring it to fruition, and then exclusively manage, market, and operate the new facility.

The Emergence of the Unconventional Convention Center Sector

As the competition between both cities and centers to play host to conventions increased, however, so had the attendees standards. Because visitors wanted services customized to their individual preferences, convention centers needed to manage higher and increasingly diverse consumer expectations. To understand the voice of the consumer, for instance, many convention centers were attempting to integrate information derived from multiple sources, while also protecting customers privacy.

The Hotels Intelligent Procurement System

With the rise of online marketplaces like Airbnb and vacation rental by owner (VRBO), traditional hotels now competed with peoples living rooms. The online hospitality market created consumer demand for travel experiences and comfortable accommodations at a much lower cost. Because meeting each visitors expectations was key to customer retention, hotels and leisure operators were turning to advanced analyses for clues on how to keep their customers and shareholders happy.

Harvest City Reaches for the Cloud

In July 2015, Casper learned of the hotels contract with Venso for the development of intelligent procurement system. Until then, it was assumed that each Harvest City tenant would develop its own procurement system. Casper believed that providing a convention centerwide intelligent procurement system could provide value in supporting each tenant while enabling Harvest Citys management to create unprecedented visibility into the consumption patterns of all purchases (including money spent on people and labor). Furthermore, by integrating the intelligent building management and procurement systems, Caspers management team could more easily achieve specific procurement targets and maximize the efficiency of the complex while keeping the building and tenants secure. In addition, Venso was known for successfully integrating emerging big data and predictive analytics technologies with hotel booking and property management systems to provide reports and decision support to the boutique hotel management teams and operating employees.

After several meetings, Casper persuaded Miller to reconsider Vensos position. The system would connect procurement data, functions, and teams, initially for the hotel and convention center. This phase of the project would be implemented and tested by November 1, 2016in time for the grand opening of the hotel and convention center in January 2017. A separate contract would be negotiated during summer 2016 for the second phase of the Harvest City project. Miller explained, The contract accounted for the risk we were assuming. Miller elaborated, When Venso entered the contract, most of the Phase 2 convention center tenants contracts were not finalized. We knew many tenants were developing plans to respond to recent trends in e-commerce and the future of physical shopping, but did not realize that no one had surveyed them about their needs. Instead, the final contracts included a clause that Harvest City would provide an intelligent procurement system for all Phase 1 and Phase 2 tenants.

Implementing the Venso Contract

The day after Caspers resignation, Venso employees had to stop working when a building inspector deemed their work area unsafe. Miller commented, Our pleas to Harvest City Corporations executives to assure our ability to continue work were not acknowledged. Moreover, several future tenants treated the contract as a starting point of negotiation rather than a final document, Miller recalled, It was chaos. We were changing everything to accommodate them long after they had signed off on the original specifications. For example, in February 2016, an operating team at the convention center requested a change to the intelligent procurement system.

When Vensos project team managers complaints were ignored, Miller took the complaints to the corporations executive team, which promised to look into the matter, but failed to resolve the problems. Miller sent an email to the manager overseeing Vensos work, stating that Venso would not accept the request for the changes to the procurement sorting subsystem. Vensos relationship with Harvest City Corporations leadership continued to worsen, Miller recalled:

The new executive team failed to recognize how integral the procurement system was to the entire project. Not surprisingly, they refused to deal directly with me, so I was constantly negotiating with other subcontractors just for basic access, and they were all trying to manage their respective portions of the project. A project manager from Star & Williams, a consultant to Harvest City Corporation, added: The manager overseeing Venso did not understand that he needed to manage the uncertainty and complexity of the intelligent procurement system project in a different way from the approach used for standard building systems.

The First Event at Harvest City

In mid-November 2016, a local pharmaceutical company was offered the opportunity to host a one-day preview event. The staff was ready, and there was a palpable sense of excitement in the packed venue. As Mayor Thompson prepared to introduce the keynote speaker, however, the fire alarm suddenly sounded. The mayor attempted to calm the crowd, but the intelligent building management system triggered the fire sprinklers, spraying water on the attendees. In addition, the facility sensors automatically alerted the intelligent procurement system, which then sent a message to the fire and police departments and emergency responders, who arrived within minutes. The sprinkler incident was noted by local newspapers covering the event and picked up the next day by the national and international media. The post-incident review found problems with the IoT sensors installed by Venso to detect and monitor equipment and relate incidents to the intelligent procurement system. After Venso installed the sensors and the procurement system, the vendor hired to install the intelligent building management system had requested and was granted permission from Harvest City Corporations executive team to tap into the sensors for its fire emergency alert system. Venso was not notified of the request and its approval. In addition, as workers readied the auditorium for the event, dust from recent maintenance had caused several sensors to read that they were overheated. In addition, jam logicsoftware in the intelligent procurement system (designed to manually shut down specific sections of equipment and alert building maintenance personnel of problems) had been inadvertently circumvented when the intelligent building management system vendor tapped into the IoT sensors to build its fire emergency software module. In January 2017, OnCloud issued a report to the city that characterized Vensos system as highly advanced and theoretically capable of living up to the promised functionality, reliability, and performance, but concluded that the complexity and scale of the system would most likely delay operational stability and reliability for 612 months.