| Results
- Capital Project Delivery Assurance |
An international mining concern had committed to an
expansion of downstream processing capacity in a complex
chemical processing facility. This was a two year design
and construction undertaking of over two years from
initial studies to commissioning on a brown field site.
They had appointed an EPCM, and a plant project team,
and were in the midst of the design phase and long lead
time procurement activities, but wanted to ensure that
the project was tightly managed to avoid overruns in
time or cost.
PIP facilitated a one week review of the EPCM capability,
and then returned two months later to facilitate a schedule
and cost review.
What we did in the first week:
- Audited EPCM written procedures and plans for
completeness and effectiveness in managing a project
of this nature across design, procurement, construction
and commissioning
- Reviewed evidence of actual practice
in respect of implementation of documented procedures
- Reviewed project governance practices and the
nature and effectiveness of interfaces between
the EPCM, the plant project team and the client
- Separately surveyed client expectations
and assessment of the status and issues in respect
of the project, and the various EPCM staff’s
understanding of the same
- Identified areas of weakness and
high risk in the approach to project execution
such as:
- No individual assigned responsibility for
optimising the critical path for the whole project
- The “theoretical” critical path
activities at the time did match the delays
and resourcing priorities on the ground. There
was no consensus on what was currently critical
path, what was likely to become critical path
and what was determining the constraint
- No early involvement of contractors, maintenance,
commissioning and operators in design and construction
planning (contractor approach briefings were
only post “mobilisation”)
- Heavily sequential approach in which most
design preceded construction planning
- Project reporting and management driven by
“Rules Of Credit” reporting emphasising
theoretical work accomplished rather than immediate
and anticipated activities on critical path
- Process rather than outcome focussed procurement
with no explicit provision to ensure best pricing
or delivery achieved
- Vital project management tasks not programmed
in the schedule – lack of recognition
that management of the design phase or construction
planning themselves consume resources and time
and need to be planned for
- A tendency for the design process to be viewed
in isolation within disciplines and apart from
the practical realities of achieving actual
construction within optimal time and cost. This
specific project involved process plant in five
specific “Units” each of which had
civil, process, mechanical, structural, electrical
and instrumentation requirements. The design
was focussed by discipline, the procurement
was to be done by “packages” that
spanned units, and the construction had to be
integrated on a unit basis, so the need to reconcile
and integrate all these approaches was vital
but somehow outside the scope of most involved.
- A tendency to a reactive and compliance approach
to advancing the work rather than a proactive
and integrated push to identify potential problems
early and achieve great outcomes
- Implemented resourcing, project
leadership and project process changes to address
or mitigate identified issues. For example:
- Reprioritised the use of limited engineering
and draughting specialisations in light of a
more detailed assessment of the immediate critical
path, and the anticipated one (for example prioritising
an activity early so as to free the relevant
limited design resource later, to then address
a critical path activity when the dependencies
dictate)
- Instituted smoothing of work flow so as to
avoid merely moving a bulge or work through
preliminary design to detailed design to client
review, revision and so forth
- Reprioritised resources from other projects
- Assigned a new project manager and clarified
responsibilities and reporting relationships
- Appointed a construction manager and scheduled
specific time for construction planning
- Added a basis of commercial recommendation
step to procurement processes
- Changed the agenda, timing, composition,
chairmanship and format for project management
meetings
- Shifted progress reporting to “days
to complete” and “net savings achieved”
away from Earned Value and compliance with budget
- Instituted greater interdisciplinary co-ordination,
integration between client project management
and EPCM designers, and better integration up
and down the timeline
What we did in the follow up week:
- Facilitated a detailed review of the complete
project programme. This identified and remedied
numerous faults in schedule logic or inconsistencies
between detailed management in design or procurement
and the overall schedule and crucial milestones
- Facilitated a review of the programme
for completeness, identifying significant activities
impacting the schedule that were not incorporated
such as the time for client/project team review
and approval of design outputs, operator recruitment
and training, completion of “last minute”
electrical and instrumentation work
- Undertook a close review of actual procurement
status and performance against the overall project
requirements identifying major shortcomings with
integration of this function - 45% of the procurement
packages and 50% of the subcontract packages were
behind schedule even though initially they were
reported as on track and the prevailing belief
was that the project was largely on track
- Facilitated a review of the project
and planning between cross functional teams including
maintenance, operations, electrical and instrumentation,
process and civil design, and client management
identifying and resolving issues in achieving
constructability, operation and maintenance, integration
with existing plant, traffic management, work
access, lay down areas, construction methodology,
tie-ins and battery limits
- Were able to develop a view of
significant activities affecting project success
based on weighting for risk, proximity to the
critical path, value, level of detail and control,
length of lead time and so forth
- Initiated a cost and critical path
reduction process focussing on high weighted items,
taking nearly two months out of the base case
schedule with considerably increased expectation
of achievability
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