(PM-3033) Influence Curve — Or Inverted Complacency Curve?
Author(s)/Presenter(s): Oeyvind Vik
Most colleagues in the project management profession are familiar with what is often referred to as the Cost Influence Curve. Put briefly it documents the decreasing level of control to influence project costs as the project evolves in time.
The best description of this concept was written by the late Stanford professor Boyd C. Paulson, Jr. In 1976 he wrote a landmark article in the Journal of the Construction Division (American Society of Civil Engineers) that brought together vague observations and applications from a variety of sectors and industries, and adopted the term “level of influence” to describe the concept.
Since the 1970s the projects have been getting significantly bigger, more complex and the stakes are higher — in other words, there are more “things” that need to come together towards the end of the project. By now, we know that upfront planning is vital, but projects make it or break it in the execution phase.
Many projects are experiencing challenges in the later stages of the projects, including the commissioning phase. Does the Influence Curve breed complacency?
(PM-3039) Effective Project Leadership with Limited Authority
Author(s)/Presenter(s): Joseph A. Lukas, PE CCP
An expectation of project managers and cost management professionals is providing leadership on projects. However, this can occur in an environment of high responsibility and low authority, coupled with the use of resources in a matrix organizational structure. This paper will provide ideas on how to improve your ability to work effectively with project teams and other stakeholders to achieve success with limited formal authority. This paper will explain the differences between a leader and manager, and will discuss the three levels of leadership model, which are public, private and personal (3P) leadership. Also covered in this paper are multiple methods for developing personal power, a key component of 3P leadership. This paper will also discuss how emotional intelligence and situational leadership influence both leadership and management skills. This paper will provide practical tips for getting results, including how to obtain commitments and resolve conflicts even in a low authority project environment.
(PM-3051) Challenges for Cost Control in Operations in Peruvian Small Companies of Construction
Author(s)/Presenter(s): Gloria Luz Flores Fernandez
In the last decade, Peru has experienced a growth in its economy, positively impacting all sectors, especially construction. This conjuncture brings advantages and opportunities for all, especially small construction companies. who face new challenges seeing themselves in need of implementing new management tools that allow them to obtain competitive advantages in the market. In this process, one of the main challenges is the change of its organizational culture, which tends to be of the type of young, small and weak organizations.
It exposes the main weaknesses of small companies, describing the typical internal operating processes, where the staff covers multiple functions and tasks. It also describes the internal processes of companies that do use management tools and control of construction projects.
To carry out the implementation of cost control tools in a typical Peruvian small construction company successfully, 5 stages where the processes and actions to be executed by all the company's collaborators will be described, are identified.
It is concluded that it is feasible to implement cost control tools for a small business, provided that there is a commitment from management, since the active participation and great leadership of the management is key for the success of the mentioned purpose.
(PM-3057) Identifying Gaps in Project Control Procedures- A Case Study in Organizational Change Management
Author(s)/Presenter(s): Lipika Swarup
Engineering, Procurement, and Construction (EPC) companies are mostly project oriented profit making enterprises. Stemming from their project based character one of the key elements of their success is achieving ‘at completed’ cost and schedule of projects either ‘at’ or ‘under’ their estimated value. To achieve this goal organizations require high expertise in project controls which assists project teams to monitor and evaluate project performance and progress and further if-when required recommend adjustments in a timely manner. Within this context a small-to mid size EPC firm aims to evaluate its current procedures and re-establish effective project controls procedures.
This paper is the first step towards the overall goal and documents the gaps in the current system as identified by the internal stakeholder groups. This study has categorized the stakeholders under project management team, discipline management team, accountancy group, scheduling group, and senior management. Participant observation and analytic induction were adopted for data collection and analysis.
The major insight gained by this study deals with the organization of the various internal departments. In order to maintain managerial domains the organization disconnected scheduling and cost control groups. This disconnection has made the existing project control procedures ineffective as it directly counters the underlying principle of project controls, which relies on analyzing ‘cost and schedule’ information in unison.
(PM-3062) Prequalifying Contractors for Today’s Project Delivery Needs
Author(s)/Presenter(s): H. Lance Stephenson, CCP FAACE; Patrick Lamont
For an owner organization in the project delivery world, almost 80 to 90 percent of the project costs are managed via the supply chain process. In regards to constructors, 30 to 60 percent of their costs are also managed via the supply chain process. Therefore, in order to ensure a successful delivery of the project, contractors and subcontractors alike must be capable of demonstrating their ability to provide the necessary experience, governance and control of their respective aspect of the project. To support this endeavor, the authors developed a robust contractor prequalification assessment process and tool.
The contractor prequalification assessment process and tool can be used as a refined approach in determining the appropriate level of acceptance and tolerances required for the effective and efficient execution of the contracts within a project. This includes, in part:
• The development and implementation of a contractor prequalification work processes and tool, including expected contractual requirements, and deliverables based on the contract and scope of work.
• A refined understanding of the maturity for the organization’s capabilities based expected contractual requirements, and deliverables via the prequalification tool. The prequalification tool would provide the users with a quantitative assessment of the contractor’s ability to provide the necessary experience, governance and control.
The use of a contractor prequalification process is considered a leading indicator for assisting in the successful delivery of the project. Through the contractor prequalification process, the time invested in preparing, documenting, and communicating the approach will increase the success of the execution of the project. The introduction of the contractor prequalification process and all aspects within this paper assist the project team in reducing project delivery risk.
(PM-3067) Finding Sweet Spot on Mega Projects
Author(s)/Presenter(s): Shiv M. Pathak
In today's lump sum EPC world, customers are looking for the most cost effective offer. A general perception is that a shorter schedule increases the cost. The reality however is that a longer schedule may increase cost more than a shorter schedule, due to huge indirect component.
There is a sweet spot which gives us optimum cost without adding unusual risk to the project and at the same time providing enough duration to execute a project successfully.
A too steep schedule will have lower indirect component but result in adding more risk and potentially increase craft density issues at site leading to productivity issues and increasing cost. On the other hand a relaxed schedule will enhance certainty and lower risk but promote 'relaxed' culture and increase indirect cost.
Therefore there is not one right answer for all projects. Finding the sweet spot will largely depend on few project specific components, e.g. Plot Size, Location / Craft wage rate, Modularization vs Stick built, Location/Camp vs Residential nature, etc. An in-house analysis shows interesting trend between size, type and place of the 'sweet spot'.
(PM-3085) Application of a Portfolio Management Framework: A Case Study of a Brazilian Mining Company
Author(s)/Presenter(s): Ricardo Goncalves Alves
This paper focuses in the portfolio management for a group of ‘Sustaining Projects’ in a Brazilian mining company. Such category of project can be understood as the investment dedicated to support and maintain current operation, covering from assets renovation works to opening of new mining areas. In the case herein presented, more than 40 projects are managed simultaneously, reaching annual capital expenditure about US$100 million.
A summarized overview of the mining process is presented, highlighting the strategic relevance that project management role has assumed in supporting current business. After that, it´s presented how projects are pulled together during the annual budgeting cycle, with a special attention to early resource consolidation. It is also shown the tools used to develop the baselines and techniques adopted for forecasting. Later it´s presented the portfolio management routines, KPIs for both physical and economic control, main execution curves and integrated economic forecast using MCS at P80.
All project data are later assembled in a ‘Integrated Performance Report’, which is issued and submitted in monthly basis to Board of Directors and shareholders. The key topics of the performance report are shown in this paper, including the ‘Integrated Portfolio Dashboard’, the ‘Individual Project Status’ and ‘Risks & Issues Management’.
A comprehensive conclusion is offered highlighting the benefits achieved by the company through the adoption of a systemic Portfolio Management Framework. The limitations of the work are presented, as well as a set of recommendation for future improvements.
(PM-3094) Creating Contract Notification Flowcharts and Notification Letter Templates – Workshop
Author(s)/Presenter(s): Travis A. Olson, PE PSP
Technical Portion – 45 mins
Whether you’re a contractor, owner, RE, subcontractor, supplier, scheduler, or consultant, the project you are working on has contract notification requirements. When the contract requires you to provide notice, provide the notice. When the contract requires you to write a letter, write the letter. When the contract requires review, comments and reply, provide the review, comments, and reply. Often times people over-stress and over-analyze how the other party will receive their actions, as if they were the ones who determined the contract language requiring these actions to take place. A formal project notification discussion and partnership must take place early on in the project, allowing both parties to take the emotion and second-guessing of a “hidden agenda” out of the contractual notification process. The creation of simple contract notification flowcharts and templates, reviewed with each stakeholder, enable the entire project team to manage the contract notification provisions accurately, instead of trying to manage each other personally.
Workshop Portion – 45 mins
In this workshop, we will case study 2 prime contracts; highlight their required notification provisions, review example flowcharts and actual notification letter templates for each project. Next, the group will break into teams and be given an example contract from a real-world project. Each of the teams will highlight the contract's required notifications and draw a time-defined flow chart on their easel board. Each team will present their notification flow chart and reasoning to the group.
(PM-3104) Improving Requirement Management Process, Dealing With Informal Validating Process - Case study: BC Hydro
Author(s)/Presenter(s): Mohammadali Sayedyahosseini, P.Eng.
Despite all developments in project management practices, projects still fail due to scope creep, poor communication and lack of stakeholders and sponsors involvement, where requirement management lies at the heart of the issue.
BC Hydro conducted a study on 971 projects to analyze the impact of requirement changes on project objectives. The study revealed that 10% of project changes were driven by requirement changes. Also 55% of project changes, impacted by requirement change, resulted in cost overrun, 44% in scope change, and 1% in schedule overrun.
The second study was done, through interviewing stakeholders in the process, to investigate the reasons behind lack of maturity in requirement management by focusing on people, processes, and culture.
Notwithstanding a well-developed and detail requirement management procedure and availability of experienced people, lack of formal and transparent validating and verifying process was identified as the root cause, which was influenced by lack of consistency among individuals, lack of active and clear communication, and low traceability of requirements.
This paper is proposing a SharePoint-based tool, which will address above-mentioned process issue and bridge the gap between three separate organizations at corporate level, followed by a training module to address required cultural changes.
(PM-3105) Program Management Lessons Learned: Alaskan Way Viaduct Replacement Program
Author(s)/Presenter(s): Harry W. Jarnagan, PE CCP FAACE Hon. Life; Brian C, Smith, CCP; David Sowers, PE
This paper provides an overview of program management lessons learned from the Alaskan Way Viaduct Replacement Program being delivered by the Washington State Department of Transportation (WSDOT) in Seattle, Washington. This landmark program is changing the City of Seattle by replacing an aging elevated section of State Route 99 with a two-mile long large-diameter machine-driven single bore tunnel, one of the largest of its kind ever completed. This complex engineering and construction effort with a budget of $3.3 billion and a delivery schedule of over a decade is nearly complete. The many lessons learned that will be discussed in this paper relate to such topics as earned value management; risk management and use of contingency / reserves; proper preparation to mobilize for construction to include third-party agreements and right-of-way acquisition; change control; use of software applications; stakeholder relations and management; schedule interfaces among multiple contractors and third-parties; managing a disadvantaged business enterprise program; and the use of alternative delivery contract methods.
(PM-3121) WYSIATI “What You See Is All There Is”: How Do We Deliver Capital Projects?
Author(s)/Presenter(s): Dr. Diana Nada
Have you ever asked yourself: Why do projects fail? Why have we not improved on delivering projects given all the project management advancement? And, why it is no longer uncommon to see projects “over budget, over time, over and over again”?
Daniel Kahneman coined the term “WYSIATI” as a cognitive bias which explains how irrational we are when making decisions and how little it matters to us. Perhaps the way we share information and communicate on projects is a key determining factor to projects’ success. The ‘What’, the ‘How’, and the ‘When’ determines how executives and project implementers make strategic decisions, approve funds and deliver projects.
Research shows that there are strategies that improve the way we deliver capital projects. Neuroeconomics can help resolve barriers to decision-making in project delivery. Our awareness to the choices we make, our intuitive professional judgment and our survival needs are usually signals based on our past projects’ experiences and can impact how we share knowledge in our teams. There are strategies to improve our project management practices, help embrace uncertainty and recognize that our ‘sometimes’ irrational approach to capital investment decision making can be key to bridge the gap in project delivery.
(PM-3128) Study on Human Resource Allocation of Large EPC General Contracting Projects
Author(s)/Presenter(s): Yu Hang; Wang Jiamo
The total cost of project management human resources for large EPC projects is high. Compared to the manual labor, it’s more difficult to evaluate the management staffing level. Therefore, it’s critical to study on how to combine quantity, structure, quality of project management human resources and time with project requests in order to achieve the maximum of effectiveness and reduce the total cost. Based on the construction experience of historical EPC projects and by applying some allocating methods suitable for EPC contractor, this paper develops the standard allocation baseline of project management human resources for a standard EPC project including the staffing curve throughout the project life cycle, the quality grading standard and the standard job positions. This baseline has been applied on developing the staffing plans for several large EPC projects. Aiming at applying the standard allocation on nonstandard projects, this paper also develops an adjustment method based on VFT and AHP model. By analyzing the difference between the standard project and nonstandard ones on project scale and difficulty, the method adjusts the standard allocation to offer reference for the total allocation amount of nonstandard project accordingly. Finally, a case is studied to depict and validate this adjustment method.
(PM-3134) Groundbreaking Trends with Aerial Data Collection and Analysis
Author(s)/Presenter(s): Ryan Mextorf; Blaine Horner; Jesse Lund, CCP PSP; Rick Statile
The geospatial industry is revolutionizing large-volume earthwork endeavors through the utilization of Unmanned Aerial Vehicles (UAVs). From topographic map development for urban planning, to orthomosaic map composites, UAVs enable contractors and developers the ability to expedite data collection relating to large plots of land through all phases of the construction lifecycle. Dependent on reliable measurements, earthwork contractors need recent data to manage their operations. With efficiency gains in time and manpower savings, UAV technology offers an expedited approach to large-footprint projects for data gathering and analysis. Through a case study, this paper explores construction industry trends on aerial data collection and analysis. This paper outlines the decision to incorporate UAVs into the project management approach, technologies used to generate compelling insights from this data, and the demonstrative benefits realized by the owner. This paper concludes with an outlook on other applications where this approach could be useful.
(PM-3151) Optimized of Cash-flow: Opportunities for Finance Solutions for Contractors/Owners
Author(s)/Presenter(s): Ashraf Elazouni
While scheduling is being used by the construction planning teams to integrate the management of project time and cost at the project level, project financing is yet managed separately at the corporate level by the finance teams. This resulted in the project finance is being managed separately from the highly relevant project time and cost. This trend signifies a gap within the framework of project management. In other words, the cash flow forecasts are generated during project scheduling and merely presented to the finance team as a by-product. This represents a huge imperfection regarding the usefulness of the generated cash flow to make finance decisions.
This paper proposes a scheduling and cash flow optimization tool that achieves full integration between project time, cost, and finance. Beyond the mere generation of project cash flow forecasts, this tool optimizes schedules and cash flow and thus offers intriguing finance solutions including cutting down project finance needs and cost for the contractors as well as accelerating project delivery rate within programs for the owners.
(PM-3160) The Importance of Recognizing and Addressing Complexity in Project and Program Management
Author(s)/Presenter(s): Dr. Stephen P. Warhoe, PE CCP CFCC FAACE; Dr. Dan Melamed, CCP EVP
Although complexity is often discussed in project and program management, there is no universally accepted definition for what makes a project complex. This paper provides a general review of the literature for the general uses of the term, discussion of the common dimensions of complexity that can affect projects and how each dimension, if not addressed appropriately, can affect a project and in some cases threaten its success. In conclusion, this article will provide an overview of how complexity in projects and programs is defined and to discuss its role as a function of project and program maturity.
(PM-3194) Corrective Governance Approach to Projects
Author(s)/Presenter(s): Anton H. van der Merwe, CCP
Applied Project governance and controls is essential to any projects and is a direct contributor to the successful achievement of projects although the importance is overlooked. The paper consist of the development of a governance department that was established to ensure that standardized governance was applied across a portfolio of projects in the Mining Industry. It describes the department’s role and influence in the project life cycle between all stage gates. The paper describes the development of this department as well as various challenges it faced during the journey of maturity and lessons learned during this process.
(PM-3246) Benchmarking the Performance of Egypt's Contruction Industry Using KPIs
Author(s)/Presenter(s): Ahmed Bahaaeldin Ibrahim Ghonamy; Dr. Mohamed Ahmed Fouad El-Mikawi
This paper reviews the importance of key performance indicators (KPI) to evaluate and improve construction project management performance. A suitable research framework was established to select and determine KPI values. KPIs were collected from previous researches then face to face interviews with expert engineers to select most appropriate KPIs within the Egyptian market. A questionnaire was designed and 162 senior engineers responded to ranking KPIs.
The paper provides six KPIs that were used to measure project management performance efficiency and evaluate the performance of contractors in Egypt. The results confirm that using KPIs are essential because they assist construction companies in recognizing their strengths and weaknesses and carry out unremitting enhancement and improvement. The research methodology is applicable in other countries with some modifications.
(PM-3259) Introduce Safety Measures in Earlier Phases of the Project Life Cycle to Increase Success of Project
Author(s)/Presenter(s): Chantale Germain, P.Eng.; Dr. Nathalie Drouin
Accurate planning is key to the success of projects. Distinctively, safety events on construction sites must be considered and impact the performance of planning and scheduling. Hence, it becomes essential to introduce safety measures in earlier phases of the project life cycle. Based on a literature review and a case study of a Canadian energy company, this article suggests a model to introduce safety measures early in the feasibility phase to increase the project planning performance. More specifically, it considers the categorization of safety events, lessons learned, performance analyses and negative patterns tested on the planning and scheduling of a mega project.
(PM-3279) A Bit-Sized Scope Management Framework
Author(s)/Presenter(s): Sunny Goklani
While there exist best practices to plan and control costs, schedules, and risks, the biggest surprises (in author’s experience) that affect project outcomes, emerge from inaccurate or differential understanding of the underlying connector, the scope. Even with well-defined WBS and matrices, the current methods of visualizing and managing scope lack a way to ensure if all teams have covered the entire scope and have considered effects of its ongoing evolution.
From author’s experience of managing costs for cumulatively over ~$400 Mil in projects, this research paper proposes a ‘bit-sized framework’, a paradigm-shift in scope management.
Through managing scope by ‘bits’ (smallest element of scope definition) in a team-shared ledger of a matrix where its effect on cost, schedule, risk, procurement, etc is defined; any member can add a bit-definition, which evokes a notification response for other teams to evaluate and define its impact. As project progresses, the bit-ledger with its digital functionalities and all bits defined with in-built change manager, acts as a real-time scope management tool.
This web-tool/app will enable early detection of impact of changes, bottoms-up ownership, real-time evaluation, and creating of a common-scope universe, that is defined and shared by all project management disciplines.
(PM-3281) Developing a Closeout Management System for a Successful Project Closeout
Author(s)/Presenter(s): Nina Terrell
Project closeout, like its name, all too often is the last consideration of project management. However, this time from substantial completion to closeout can impact the entire project schedule, budget, resources, determine future work and leave the lasting impression of services provided. This paper demonstrates and discusses how to successfully closeout a project based on research, the author’s first-hand experience and recommended practices. The discussion details starting with the end in mind, developing a closeout management system initiated at project startup through to completion. The closeout management system requires implementing the appropriate level of planning, document/data management procedures, project controls and resources to meet project objectives, maximize profits, and reduce risk to ensure a successful project closeout.
(PM-3288) Integrating Safety with Project Management Plan as Complete Knowledge Area
Author(s)/Presenter(s): Abdulkareem Aldueb; Abdulhaman AlAskar
It is no secret that working in the project construction industry is more dangerous than other professions due to many adverse conditions and outcomes that results in negatively impact the project Human Resources (deaths, injuries, etc.), Cost (damage of assets & equipment, etc.), Schedule, etc...
This Paper aims to analyze how the safety should be managed in a different way than what Industry and International Project Management Methodologies tend to present, it will identify the current gaps of existing practices and subsequent improvement. The Paper will include methodology for how overall system supposed to work to enhance safety management and its integration with the overall project plan. This will ensure addressing safety requirements properly and balance with other project aspects from initial stage of the project. This integration will ensure all stakeholders agreement and involvement in early stage as they will approve safety management plan as part of Project Management Plan and commit the team towered completing the project safely.
In summary, this paper will provide the project management industry with a globalized process to enhance safety management by better integrating its plan and management as part of Project Plans.