Owner Construction Management Performance Improvement Program

Overview 

Company – Joint Venture, Oil Producer and Chemical Company 

Industry – Advanced Chemical Refining 

Category – Construction Management 

Project Budget – $215M 

Goal – Recover Schedule, Minimize Cost Over Runs, Improve Safety and Quality, Improve QA/QC, Develop Risk Mitigation Plans. 

Obstacles – Existing supplier contracts lacked appropriate incentives and disincentives. Full craft employment issues in the region. Site construction culture not contusive to injury prevention, inexperienced and understaffed JV project management. Undersized steam plant to accommodate new capacity. 

Solutions – Added Construction management teams between JV team and suppliers. Implements new Safety Plan, Re-Baseline of Schedule and Cost, Implementation of Project Controls including Cost/Schedule curves, comprehensive Dashboard and weekly reporting. 

Results – Improved Safety results to lower than industry averages. Recovery of Schedule by two months, Reduced RFI’s and NCR’s, Improved craft productivity, Daily Progressing Accurate Cost Forecasting. 

Goals

Improve all aspects of Construction Management to Deliver Project 

  • Establish and expand an experienced construction management team to replace seconded JV staff 
  • Improve JV decision making timeliness 
  • Establish reliable budget and schedule with a goal to recover as much schedule as possible 
  • Improve procurement and project controls 
  • Work with suppliers to develop Integrated QA/QC to reduce NCRs 
  • Improve engineering timeliness, quality and construction reviews to reduce the number of RFI’s and impact on quality, schedule and cost 
  • Establish and maintain a safe construction site reducing safety incidents for the 190 craft and CM personnel 

Obstacles

Management of Change to Achieve Compliance 

Challenges to meeting the goals of the project: 

  • Joint Venture structure impeded decision making and clarity on roles and responsibilities  
  • Brown field construction site, with complex work processes, multiple contractors and limited room 
  • Poorly drafted Supplier contracts with no incentives or disincentives  
  • Tight craft labour market 
  • Late engineering and procurement 
  • A culture change was required across the site to improved safety 

Solution

PTAG’s Team of On-Site Subject Matter Experts Delivered and Implemented the Program 

Reorganized the Joint Venture project management approach, establishing an experienced and expanded construction management team to replace supplement/replace personnel from the JV members. Six-person CM Team included Senior CM, Planner, Cost Engineer, Quality Manager, Safety Manager, Contracts/Procurement Manager 

Reorganized the reporting, planning and meeting structures for Site, E&P, GC and Subcontractors to report to and integrate with the new CM Team to improve construction planning, execution, quality and safety. 

Implemented a new GC led safety program based on “Beyond Zero Accident Techniques” with full site training.  New experienced CM Team Safety Manager integrated Site and GC safety teams into a single team. JV and GC senior management attended weekly safety meetings. Improved the focus on behavior, hazard awareness, safety planning and supervision as key areas for continual improvement. Increased safety supervision. 

Developed new manpower plan to attract additional craft including adding a second shift to help recover schedule 

Using progress to date, updated engineering and procurement schedules, established a new baseline for project schedule and budget.  

Developed a weekly reporting structure based on a one-page Dashboard that provides at a glance information on Highlights, Safety, Milestones, Construction, Engineering, Project Services, Quality, Risk and Commissioning/Start-up Readiness. Details for each Key Result Area contained in eight-page attachment. Trained all site management and supervision on new processes and required reporting 

Established Risk Register with weekly updates included in the weekly Dashboard and Report 

PTAG PROCESS

SMEs Delivered, Implemented, Administered and Monitored the Program 

  1. Review and Assess 
  2. Report Results 
  3. Develop Program and Training 
  4. Implement and Administer 
  5. Monitor for Results 
  6. Transition for Ongoing Support 

PROCESS RESULT

SMEs Delivered and Implemented the Program 

PTAG’s Advisory TEAM performed a two-week assessed reviewing contract documents, execution plans, supplier agreements, procurement schedules project, organization structure, estimates, budgets, schedules, craft productivity and safety plans and performance. We established that root cause to the poor safety, quality, schedule and cost adherence was an understaffed and inexperienced owners team, combined with weak supplier agreements, poorly developed scope, estimate and schedule with the Engineers and GC along with immature project procurement and project controls. 

The solution proposed and accepted was an experienced 6-person CM team located at the project site with direct links to the JV Team for timely decision making to develop and implement a recovery plan. The CM Team implemented a recover plan starting with a new baseline for project budget and schedule, established a safe working environment, focused on engineering deliverables, procurement, quality and improving craft productivity.   

RESULTS SUCCESS 

  • Resolved JV construction management deficiencies  
  • Developed and delivered construction execution plan 
  • Finalized Scope 
  • Established and maintained adherence to new baseline for Schedule and Budget 
  • Improved Safety performance 
  • Improved Quality performance 
  • Eliminated gaps in communication between Owners, Project, Site and key suppliers (E&P and GC) 
  • Improved Management of supplier contracts
  • Implemented project controls with daily progress reporting, weekly reporting, earned value and control    
  • Improved Risk and Opportunity identification and management 

“We now have visibility and confidence in the project’s schedule and budget”  

Owner Senior Executive

PTAG provides leading firms in the Power, Oil & Gas, Petrochemical, Mining, and Capital Infrastructure markets with qualified People, efficient Business Processes, and Information Management Systems that ensure consistently successful delivery and efficient operation of major capital projects. 

Risk Management and Risk Mitigation

This 1-Page summary gives you a downloadable quick Reference Guide of the fundamentals of project risk management and mitigation.

I2PD, a delivery model for quickly planning and executing capital projects

Join Bruce Burwell and Michael Dubreuil 1pm EDT, August 11th, 2020 for a brief online seminar to learn about Integrated Industrial Project Delivery (I2PD).

Outage Improvement Program on Mining Project

Overview 

Company – Iron Ore Client 

Industry – Mining – and Pellet Preparation 

Category – Shutdown Planning and Construction 

Project Budget – $35 million 

Goal – Improved Detailed Planning, Shutdown Preparation, Outage Management, and Construction Productivity while meeting all safety requirements. 

Obstacles – Brown field site, Old plant, Machine Rebuild in a tight fifty-seven-day shutdown (with 3 rounds the clock shifts) with Commissioning going on simultaneously while constructions continues. 

Solutions – Subject Matter Expert assigned, assessed, and developed a compliant PCO processes, procedures, and supporting software. Additional staff assigned for implementation, administration, and transition for long-term support. 

Results – Project Completed on time and budget vs 30% cost over-run and 2 weeks of delay costing the company significant lost production. Safety was good with no lost time. 

Goals 

To complete the Machine Rebuild within budget and time with no safety incidents 

  • Carry out the Outage for Machine Rebuild in a safe environment and to ensure start-up and operation after 57 days of shutdown.  
  • Improve site communication on a shift by shift basis 
  • Improve timely decision making  
  • Ensure Materials and Spares availability to avoid schedule slippage risk. 
  • Improve contractor performance 
  • Implement Lessons Learned procedures to ensure continuous improvement on future Outages 

Obstacles

Management of Change and Implementation of Best Practices and Lessons Learned to Achieve the goals of the project 

  • Tight brown field site, with complex work processes 
  • Lots of vertical construction, pre-com, and commissioning starting within a week of shutdown.  All while the machine rebuild, and other modifications were under construction 
  • Revised processes and procedures required to mitigate risk and  achieve safety compliance that would require a culture change across the site 
  • Over 200 workers at site in tight conditions working three shifts 24/7 
  • Historic Project Execution planning practices 

Solution

Developed and Implemented streamed lined processes for Project Controls and Contracts Admin Program to minimize and correct for Outage delays on a shift by shift basis to eliminate Outage schedule delays and cost overruns 

PTAG’s Advisory Team was engaged in May 2017 to provide a complete assessment of past Outage programs to determine gaps and the develop improvements to achieve more reliable and certain cost and schedule outcomes. The team developed an improved execution plan with real-time project controls to execute the project on budget and time with no lost time accidents. 

The Team developed and implemented the PCO processes and procedure (see slide 6) and developed a detailed list of deliverables and milestones to monitor and track the progress and state of preparedness of the Project before the shutdown. 

There were 3 critical areas (1) list of items that needed to be addressed as shown in slide # 3 under “ Goals” (2) overall work flow processes were developed including RACI charts to ensure that everyone was aligned (3) implement a Field Management system so that daily progress data could be compiled, reviewed and analyzed on real time basis, allowing for corrective and timely actions to be taken on a shift-by-shift basis as opposed to typical weekly project reviews. 

Improved timely decision making using detailed Organization RACI charts communicating who is responsible for change management and scope management, amongst other project functions. 

Improved site communication and overcame the requirement for full face masks and a work environment with high-ambient noise levels by providing 2 positive pressure shacks located on each floor where masks could be removed, and where issues could be easily and openly discussed 

To improve Contractor performance and acceptance of new control processes and feed back loops – A “Great Save” program that identified weekly the “best safety behavior” was implemented with rewards to the contractor for the best save. 

A real-time QA/QC application was implemented to ensure seamless transition from construction to pre-com to commissioning to operation on a system by system basis. 

PTAG PROCESS

SMEs Delivered, Implemented, Administered and Monitored the Program 

  1. Review, Assess and Plan 
  2. Report Results on Near – Real basis 
  3. Develop Field Management Admin Program and FM Training 
  4. Implement and Administer 
  5. Monitor and Report the Results 
  6. Plan for Next Machine Rebuild 

PROCESS RESULT 

Project Controls (PCO) and Contract Admin(CA) team members Delivered and Implemented the Project based on the overall process as shown below: 

PTAG TEAM of SMEs developed and implemented new streamlined Project Control and Contract Admin processes from May 2019 to completion of the Project Dec 2019 to improve contractor feedback, corrective action, decision making and scheduling.  The Program was tailored to work within site constraints and training over 200 workers in a congested area at site. 

RESULTS SUCCESS 

  • Completed the 8-month project with 57 days of shutdown within budget and time  
  • No Lost Time Accidents 
  • No cost-overruns and claims as compared to previous 2 similar machine projects which were delayed by 2-3 weeks and 30- 40% of cost over-runs 
  • Past lessons learned and best practices were identified and implemented by Joint Client/PTAG team 
  • Implemented real time progressing at each work face of the round-the-clock shift work allowing timely corrective actions to be take on a shift- by- shift basis to maintain schedule vs typical daily or weekly review meetings. 

ACHIEVEMENTS 

“At the end of every shift we knew where we stood … and we could take timely and necessary corrective steps?” 

Client Project Manager and Construction Coordinators

PTAG provides leading firms in the Power, Oil & Gas, Petrochemical, Mining, and Capital Infrastructure markets with qualified People, efficient Business Processes, and Information Management Systems that ensure consistently successful delivery and efficient operation of major capital projects. 

How To: Categorize, Analyze and Report Project Construction Delays

Construction Delays are unplanned events that happen during both work planning and execution that result in a cost and/or schedule variance to the original project plan. Delays can impact your project cost and extend your project delivery schedule.

Original Equipment Manufacturer Quality Performance Improvement Program

Company – Original Equipment Manufacturer – OEM

Industry – Electrical Generation

Category – Equipment Supply and Installation

Project Budget – Multiple Projects

Goal – Recovery action plan to improve quality performance to re-assure Owner that the OEM can be trusted to provide a reliable and warranted product

Obstacles – Global company with manufacturing facilities in numerous countries supplying equipment

Solutions – Conducted an internal analysis of both historical and active projects and audited their Quality Program. Recommended and supported the implementation of accepted actions items to address gaps in their Quality and Training programs.

Results – Improved quality results to assure Owner that the company can be trusted to reliably deliver on its commitments and jointly develop an “owner specific” approach aimed at improving customer satisfaction.

Goals

Improve Quality and Restore Owners Confidence

  • Implement corrective actions to remain equipment supplier of choice
  • Continuously improve equipment design and reliability
  • Implementation of modern design tools and methods into the Quality program and training to targeted OEM organizational staff
  • Develop QA/QC metrics used at different phases of the project and application of a more rigorous in-house inspection program
  • Implementation of a revised quality manual to better suit Owner projects, including inspection and test planning early in the project lifecycle
  • Minimize financial loss attributed to rework and deficiencies

Obstacles

Management of Change to improve quality performance

Challenges to meeting the goals of the project:

  • Differing international interpretations of testing standards
  • Compliance with published standards
  • OEM Commercial position impacts on technical requirements and discussions
  • Fully understanding the root cause in determining the needed corrective actions prior to revisions of the Quality program and supporting documentation
  • Demographics associated with the coordination of training on and off site globally and ongoing refresher programs
  • Program needed long-term monitoring of Non-Conformances and reporting to ensure continual improvement

Solution

PTAG’s Team of Subject Matter Experts Delivered and Implemented the Program

Original Equipment Supplier (OEM) was constrained from participating in any proposal submissions due to performance related issues until it was demonstrated to the Owner that existing technical deficiencies were addressed, and Quality program was enhanced.

The team developed and implemented the processes and procedural changes required for Quality improvement to their existing QA/QC program and identified areas for improved training opportunities. QA/QC Best Practices were deployed throughout the organization.

Mitigation plan was developed to limit the schedule impact of some of the on-going projects and to meet delivery requirements of future projects.

Identified the need for increased communication and provided a solution plan for a better communication structure to be applied at all levels of the OEM organization

Enhanced risk identification and control process were executed during the detail design, through manufacturing and installation phases

Constructed an internal audit process identifying findings and KPI measurements for improvement throughout all global facilities and on-site project locations. Team coached OEM project staff to identify and understand the planning techniques to mitigate the impacts of Non-Conformances

PTAG PROCESS

SMEs Delivered, Implemented, Administered and Monitored the Program

  1. Review and Assess
  2. Report Results
  3. Develop Program and Training
  4. Implement and Administer
  5. Monitor for Results
  6. Transition for Ongoing Support

PROCESS RESULT

SMEs Delivered and Implemented the Program

PTAG’s TEAM of 3 SMEs identified Quality Management Best Practices, delivered the expertise needed to modernize the organizations Quality Management program which resulted in a significant reductions in NCR’s and restored the CONFIDENCE of the Owner and its representatives

Owner was presented the OEMs action plan to enhance performance, improve quality, productivity, safety and eliminate rework occurrences

OEM welcomed suggested corrective actions from both the PTAG SME’s and Owner representatives to ensure the OEM remained the supplier of choice

Step 1: Define and Implement Your QMS

Step 2: Assess the Maturity of Your QMS

Step 3: Improve Your QMS

RESULTS SUCCESS

  • OEM enhanced Owners satisfaction with a modernized Quality Management Program
  • Business priorities are now linked in the Quality Management Program when developing and or supplying a piece of equipment
  • Since the implementation of the revised Quality program, the organization’s culture continues to improve with the goal of zero Non-Conformance Reports
  • Quality Program includes long range business planning objectives and ongoing performance assessments
  • Quality program implements ongoing organizational learning, continuous improvement, sustainable work processes, productivity improvements, failure prevention, and conformance to requirements

ACHIEVEMENTS

  • In house organization resources trained for assessing and improving the implementation of Quality Management Best Practices
  • Performance metrics now embedded in the Quality Management Program
  • Organization delivers products that meets Owners and Regulatory requirements
  • Organization recognizes the importance of open and collaborative discussions in recognizing Owners requirements and expectations when interpreting technical specifications
  • Significant reduction in projects that experienced over budget issues, late start-up, financial losses and unhappy board of directors and shareholders
  • Recognized the need to define, identify and continuously improve in order to maintain Owners confidence

PTAG provides leading firms in the Power, Oil & Gas, Petrochemical, Mining, and Capital Infrastructure markets with qualified People, efficient Business Processes, and Information Management Systems that ensure consistently successful delivery and efficient operation of major capital projects.