Project Controls Expo, 18th Nov 2014 - "From Cost Plan To Bid Evaluation To Contract Administration The Earned Value Project Control Cycle" By Roland Horat

Copyright @ 2011. All rights reserved
Project Delivery , growth and collaboration
Project Controls Expo – 18th Nov 2014
Emirates Stadium, London

About the Speaker
 Ken Phillips is a Project Controls Professional / Lead Planning
Engineer who has worked in projects for many industries including
infrastructure, marine facilities, oil & gas, refineries,
petrochemicals, chemical, nuclear, conventional power,
pharmaceuticals and wastewater.
 His experience includes all phases of engineering and design and
extends through construction and commissioning. He is familiar
with a wide range of planning software and planning techniques.
Over 15 years experience of Middle East Projects and International
Projects recently working in Qidong, near Shanghai on an FPSO
Project at COSCO’s shipyard.

The aim of this talk is to highlight how project organisations
adapt to this change, quickly and effectively, which is at the
core of Agile work flows and potential to impact Major
Infrastructure Projects.
Many organisations are developing strategies and encouraging
collaboration to allow their employees, customers and partners
to intelligently connect and interact to improve successful
Project Delivery and Growth and collaboration on Major
Projects.

Appropriate Delivery Strategy
The appropriate delivery strategy will drive project cost, quality of design,
construction, long-term maintenance, and project completion date.
•Project delivery within an organisation should focus on what the
business is trying to achieve especially customer needs including
Health, Safety, Environment and Human Factors.
• Fast-tracking is not a method of delivery, rather, it’s a
management strategy within delivery methods.
•Consider why do projects fail?

“Without continual growth and progress,
such words as improvement, achievement,
and success have no meaning,” Benjamin Franklin

“Failing to plan is planning to fail” (Franklin)
Plan – do – check - act

Extract from Engineering for Growth
Interesting Facts
& Figures –
setting the scene

Growth
Growth
The business analyst Igor Ansoff outlined some important strategies for business growth.
He identified four key approaches to growing a business.
Beiersdorf's development illustrates all four.
i.Market penetration: Increasing market share for a firm's products in its existing markets..
ii.New product development: developing new products for existing markets.
iii.Market development: finding and developing new markets for current product lines. This is
most suitable when existing products require only minor modifications to be suitable for new,
overseas markets.
iv.Diversification: developing new product markets outside the existing business. A firm will
pursue this strategy where new markets are highly attractive
Read more: http://businesscasestudies.co.uk/beiersdorf/growing-a-business-by-developing-
products-and-markets/ansoffs-growth-strategies.html#ixzz2hEq97EO3

Meeting the Customers Known Requirements, what can go wrong?
Apologies to those who got it right!!
Customers
Original
Scope
Conceptual
Definition
Delivered
Design
OTIF –
totally
satisfied
customer

Lifting Off – Implementing the Strategic Vision for UK
Aerospace
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/142625/
Lifting_off_implementing_the_strategic_vision_for_UK_aerospace.pdf
By working together in the Aerospace Growth Partnership (AGP), Government and industry have developed a
shared vision for UK’s aerospace industry to:
• ensure that the UK remains Europe’s number one aerospace manufacturer and that it remains second only to
the United States globally. This is an ambitious and challenging goal, given intensifying international competition
and the rapid pace of innovation in the sector
• support UK companies at all levels of the supply chain to broaden and diversify their global customer base.
This will be critical given the entry into the market of new manufacturers of large civil aircraft.

Collaboration
 With the rapid changes and demands for new projects and infrastructure taking place
within today’s hectic World, this is stretching project delivery and growth of Agile
organizations
 The recent improvement in technology has provided the world with high speed internet,
wireless connection, and web-based collaboration tools and has as such created a "mass
collaboration." “Yammer” is one example.
 People from all over the world are very effectively able to communicate and share ideas
through the internet, or even conferences, without any geographical barriers.
 Collaboration in technology encompasses a broad range of tools that enable groups of
people to work together including social networking, instant messaging, team spaces,
web sharing, audio conferencing, video, and telephony.
 Many large companies are developing enterprise collaboration strategies and
standardizing on a collaboration platform to allow their employees, customers and
partners to intelligently connect and interact.
 Enterprise collaboration tools attain collective intelligence and staff collaboration at the
organization level, or with partners.

How to Integrate & Improve
Safe & Standard Systems of Work

Projects in various organisations often fail because of lack of
focus on Project Delivery:
 Initial estimates of cost & time not updated with reality
 TIME - Plans are not used correctly or effectively to guide the project
 COST – insufficient allocation of costs to activities
 BUDGET – Insufficient initial budget, poor estimating
 COMPETENCE – Project not within core competence
 RESOURCES – Dilution of resources working on multiple projects
 SCOPE – Inadequate scope definition at onset of project – Changes not considered
 COMPLIANCE - ignored regulated controls & health, safety, environmental quality
procedures
 Project Managers & Lead Engineers are not trained to acquire adequate
Project Control Skills
 Lessons are not learned on Time – Cost – Resources – Estimating
 Communications / feedback across the team are limited when satellite offices
are involved.

When things go wrong – Design, Construct, Operator Errors are
all preventable from Pisa to Deepwater Horizon .

Using Failure as a Tool – Vinod Khosla
19/11/2014 Ken Phillips AMEC 15
More than lessons learned!! Consider Behaviour.
Get out there and engage. Are you in Touch with the Project?

The New Economy
a skill life long learning
managers entrepreneurs
labor v. mgt teams
bus v. environ encourage growth
security risk taking
monopolies competition
job preservation job creation
wages ownership, options
plant, equipment intellectual property
http://www.khoslaventures.com/papers-presentations.html
Old versus New economy

Project Delivery
 Design, delivery information, history, invoicing, customer service contact can
all be integrated and made available.
 Some of the technologies required to achieve this level of information sharing
and availability have only become available recently. This open sharing of
information is a key aspect of creating an agile operation.
 The appropriate delivery strategy will drive project cost, quality of design,
construction, long-term maintenance, and project completion date.
 Project delivery within an organisation should focus on what the business is
trying to achieve especially customer needs including Health, Safety,
Environment and Human Factors.
 Fast-tracking is not a method of delivery, rather, it’s a management strategy
within delivery methods.
 Consider why do projects fail? When things go wrong……….

Project Delivery in AMEC

Project Management focuses on technical delivery,
Programme management engages in relating design concepts to the business strategic vision of
the future.
Project Management is focussed on the nearer term objectives,
Programme Management tends to be focussed on longer term or corporate objectives.
19/11/2014 19Ken Phillips
How do they fit together with
Time, Costs, Resources &
Competence ?
Enterprise Resource Planning
Near term objectives
Longer term
objectives

How Offshore Platforms are designed, fabricated and installed
requires complex planning, collaboration & excellent project
delivery including Safety.
http://www.centrica.com/index.asp?PageID=1043&mediaid=530 ( Mega Rig DVD – discovery channel)
Scientists, Engineers and drilling experts are developing a new generation of
state of the art platforms and innovative drilling technology, whilst battling the
remote and challenging gas fields of the North Sea

 “begin with the end in mind.”

 ― Stephen R. Covey, Seven Habits of Highly Effective
People: Powerful Lessons in Personal Change

Planning Processes

Collaborative Planning & Scheduling

What has happened in the past in organisations?
Some typical issues
 Projects were not effectively prioritised
 Projects happened without authorisation
 No definitive list of projects
 Project benefits are not managed or realised fully
 Poor visibility of progress
 Shared Resources are switched from panic to panic
 Projects are not notified & financed in a timely manner
 Designated Project Manager not appointed at onset of project
 Projects not planned and estimated based on legacy projects
 Uncontrolled changes to project

Putting Systems, Processes & Support in place
Customer Focussed, Consistent, Controlled Project Environment

Figure 1: the two pillars of the Toyota Way – kaizen
= improvement; genchi genbutsu =
go see for yourself (source: Toyota 2001)
The two pillars of the Toyota Way

High Value Engineering Centres
The presence of global players in the industry provides the following
value additions:
Access to latest technology and equipment: For instance, a strategic
partnership
between Reliance Industries Ltd. (RIL) and British Petroleum (BP) would
help RIL to gain access to deep water exploration technology for its KG
basin and augment its production levels.
Access to global project management and risk management capabilities
Elimination of out-dated practices and improved quality and work-
practices due to increased competition
Competent players planning to diversify to new sectors without any prior
experience in them — opportunity to move up the value chain by
partnering with foreign players with sector expertise.

High Value Engineering Centres
These help businesses create a number of hubs around the world
from which Business can service international clients.
Each of these needs to provide the same competencies,
use the same tools, provide the same level of delivery and have
the same culture. For example Houston execution capabilities with
Monterrey’s support services.
Contractors, frequently discuss how to differentiate from competitors. In the
Gulf of Mexico, for example, a clear differentiator is a high-value engineering
center located a two-hour plane flight away in the same time zone as
projects.
This is a fundamental component of growth strategy which ensures
the ability to configure the work across time zones and at a cost to
suit clients’ requirements. and consistency in Project Delivery.
One example of is the adoption of of “SmartPlant 3D “ for
global work sharing capabilities that enable the use high
value engineering centres, while maintaining full control
over the progress in the project in real time

A Brief Thought Provoking Topical Moment – HS2
Remember these facts:
Crossrail construction began May 2009
Tunnelling began Spring 2012
Project due to open 2018
Cost £14.8 Billion
9 years of Construction!

The Key is Planning
Sir David Higgins hinted that HS2 could be delivered under the £50 billion budget by accelerating the
project — though he refused to set a new date ahead of the scheduled 2035 completion..
Do you recall Crossrail facts from the last slide?
He said: “The key to this is planning. I don’t understand why it needs to take so long and time is
money. We have some of the world’s best designers and contractors and we should challenge them
to do it quicker.”
He dismissed opponents’ claims that there was no demand for the link, saying it had dual benefits
— boosting capacity on commuter routes into London Euston and speeding up journeys to the
North.
He said: “It is essential in this country to have a proper, modern rail. The thought that we could be
living with this railway in another 30 to 40 years’ time is difficult for me to comprehend. Every
morning 4,000 people arriving at Euston stand and that’s only going to get worse. In the North it’s
about connectivity.”
Crossrail construction began May 2009
Tunnelling began Spring 2012
Project due to open 2018
Cost £14.8 Billion
9 years of Construction!

Think about the enabling works for such a project. Heavy goods Vehicles thundering down picturesque village lanes,
Spreads the size of Motorways across the landscape for years while bridges and rail tracks are constructed.
Over the last 50 years when Government Projects are advocated backers downplay the costs to gain political support,
the budget increases but the drive behind these projects make it very difficult to stop.
If the same money was injected into improving the existing rail infrastructure journey times could be reduced and
more passengers carried without standing from Euston to Glasgow?
China & Japan do not seem to have the same problems as the UK in introducing new infrastructure. Perhaps we need
centralized planning of infrastructure as suggested by Sir John Armitt 2013.
See Business Insider Australia 108 Giant Infrastructure Projects that are reshaping the World.
Sir John, the former Network Rail boss who chaired the Olympic Delivery Authority for the 2012 Games, was asked to
review how Britain could improve its poor record of project planning and delivery. Last year, in its report on global
competitiveness, the World Economic Forum ranked the UK 24th for the overall quality of its infrastructure.
Launching a new report into how to rebuild the country’s crumbling transport, energy, telecoms and water
infrastructure, Sir John Armitt caledl for the establishment of a new National Infrastructure Commission charged with
evaluating the UK’s needs 25 to 30 years out.

So what do Projects need to meet modern Project Delivery?
• Excellent time management skills
• Competent Planning, Resourcing,
Estimating Ability
• Agile ‘Can do’ proactive attitude
• Adaptable, flexible.
• Fair – respecting different people’s
viewpoints
• Committed to the team and the
project’s goals
• Decisive and realistic
• Excellent communication skills
• Leadership
• Assertiveness

Where should we go ?
 We need to take a Pragmatic Approach to Projects,
 Many simultaneous projects, Need to manage resource pool & build up key
skills & core competence
 Projects tend to be similar to each other
Plans tend to be simple - simple bar charts
 Move away from tendency to Crisis Manage, Fire Fight, Reduce pressure on
shared resources to concentrate on key challenges & issues
 Introduce Due Diligence Team for Review of Bids prior to submission
 Future proofing - proven technology is not only the most productive
environment for plant design and engineering, it is also genuinely 'future
proof', securing information assets through the entire lifetime of the plant and
establishing Together with Integrated Project Management ensures
competitive advantage.

Ensure we are aware of Client requirements & programme needs at the onset
of a project. e.g. Shutdowns, Road Closures etc
 Deliver Projects ON TIME IN FULL - A Given !!!!

Continual improvement
The heart of integrated project management & control

In conclusion to achieve effective delivery of projects, growth
collaboration and drive to completion requires the following:
Ensure all HSE Safe working practices across all aspects of the Project.
High performing, Ethical Competent Project Management & Project Control Teams with
experience in project delivery is essential.
Educating / Mentoring young people in the basics of project control systems & management
is paramount. ( Current average age of Project control specialists is around 50.)
Need to make Project Controls roles attractive with professional recognition.
Maximise use of high-value delivery centres (HVDCs).
Improve predictability by challenging norms and the traditional approaches.
Raise Profile of Project Control function within Project Management Organisations
Team based approach - Encourage creative teams with a “Can do attitude”

Well Defined Scope Agreed at the beginning with approved changes.
Meet current customer needs and deliver with minimal costs, waste and time
Adopt New Technology Quickly
Understand Risk
Collaborate with all Internal & External Stakeholders
Change the way of working, effect change rapidly
Co-location – integrated teams where practical
Check Understanding & Effective Communications
‘The difference between what we are doing and what we are capable of doing would
solve most of the world’s problems.’
Mahatma Gandhi
In conclusion to achieve effective delivery of projects, growth
collaboration and drive to completion requires the following:

******** THANK YOU, ANY QUESTIONS ********

Project Controls Expo, 18th Nov 2014 - "From Cost Plan To Bid Evaluation To Contract Administration The Earned Value Project Control Cycle" By Roland Horat

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