8. dr. mangesh korgaounker project management presentation

Project Management – Conventional &

Contemporary

Prof. M. G. Korgaonker


Contemporary

Major Changes in Project Sector in India

• Public Private Partnerships using models such as BOT

• Increase in size and capacity of projects executed

• Consortia, joint ventures, strategic alliances in projects

• Rapid entry of new entrants and rapid corporatization

• Improved practice of project management

• Improvement in productivity, quality and delivery capability

• Consultancy services in construction / project mgt, procurement

services, regulatory issues, technology


Contemporary

Major Changes in Construction Sector in India

• Mega project financing, both within and outside India

• Government funding for infrastructure projects

• Secure and execute projects abroad

• Projects at all levels : national, state, municipal

• Projects and construction account for largest employment

• Projects in Infrastructure, Oil & gas exploration, Petroleum and

chemicals, ICT, Power, Social development

• Institutions and implementation plan for safety, quality, technology

• Improved safety record of construction industry from accident rate of

0.10 / million man hrs worked in 2001 down to around 0.01


Contemporary

Major Changes in Construction Sector in India

• Reduction of time and cost overruns from 167 % to 64 %

• Industry Status under IDBI Act to construction industry

• Arbitral institutions for dispute resolution

• National Skill Development Mission

• Construction Sector Skill Council Of India

• Disaster identification and mitigation

• Go head for REITs and IITs (Real Estate Investment Trusts &

Infrastructure Investment Trusts)

• Go ahead for raising funds through QIP( Qualified Institutional

Placements) mechanism


Contemporary

Some Illustrations of Recent Brand Building Projects

• Space Exploration – Mangalyan,Chandrayan, INSAT, Launch Vehicles

• National Highway Development

• Large Refineries ex. Reliance at Jamnagar

• Konkan Railway

• Delhi Metro Rapid Transit System and several othe metro projects

• Bandra Worli Sea Link

• Mundra Port & SEZ : India’s largest Pvt Sector Port & SEZ

• New / Modernized Airports – Hyderabad, Bangalore, Delhi, Mumbai


Contemporary

Some Illustrations of Recent Brand Building Projects

• Automotive vehicles – small cars, SUVs

• Nuclear Power Plants

• Oil & Gas Exploration and Interstate Pipelines

• Super Critical Thermal Power Plants

• Nationwide Telecom Networks

• New City Development – Lavasa, Ambey Valley

• Large Scale Nationwide Retail Development

• Large scale township development


Contemporary

Major Challenges in Project Sector in India

• Lack of stable governance system – systems & procedures, single

window project clearance mechanisms, well coordinated approach

• Lack of long term funds resulting in expensive short term financing

• Complex legislation in - land acquisition, environmental protection

• Long delayed dispute resolution with piled up dues & over dues

• Gigantic debt - severely cripples industry’s ability to grow

• Unsatisfactory resource base – technology, manpower skills,

materials, innovative methods, management of stake holders


Contemporary

• Project is an endeavour in which human, material and financial

resources are organized to undertake a unique scope of work of given

specification, within constraints of cost, and time, so as to achieve

unitary, beneficial change, through the delivery of objectives.

Purpose Scope

Orgzn

Time Qlty

Cost


Contemporary

Type 2 : Water

•Product devpt.

Type 4: Air

•Research & Devpt

Type 1: Earth

•Engineering

Type 3 : Fire

•Application Software

Goals well defined

Yes No

Met

ho

d w

ell

def

ined

No

Yes

Greater Chance of

failure

Greater Chance of

Success


Contemporary

Project Breakdown Structures

• Product Breakdown Structure ( PBS )

• Organization Breakdown Structure (OBS )

• Work Breakdown Structure ( WBS)


Contemporary

Product Breakdown Structure : Heathrow Airport, Terminal 5 Project T5

Two large terminal buildings

An Air Traffic Control Tower

Road and Railway transportation links

13 kms of bored tunnels

Over 60 aircraft stands

A 4000 space multi storey car park and a hotel

An automatic baggage handling system

Airfield infrastructure


Contemporary

Irrigation project

0000

Site Clearance

0100

Site improvmt

1000

Irrigation

works

2000

Consulting

services

3000

Project

manager

4000

Drainage

ditches

1100

Roads &

paths

1200

Road

surfacing

1300

Canals &

flow strctrs

2100

Canal lining

2200

Pump eqpt

2300

Procurement - 2310

Installation - 2320

Level 1

Level 2


Contemporary

Type 2 Project

• Milestone planning

• Configuration Mgt.

Type 4 Project

• Milestone Planning

• Configuration Mgt.

Type 1 Project

•Activity Planning

Type 3 Project

• Milestone Planning

• Configuration Mgt

MWD

No

Yes

GWD Yes No

Communication

Project

Mission

Top Mgt

Support

Proj.

Schedules

/Plans

Client

Consltn HR

Tech

Tasks

Client

Accept

Monitoring &

Feedback

Trouble

Shooting

Strategic : Mission, Top

mgt. support,Proj. plans

Tactical : client consult, HR,

Tech. Tasks, Client Accept,

Monitoring & feedback,

communication, trouble shoot

Project Success Factors


Contemporary

Initiating Planning Executing Controlling Closing

• Integration

• Scope

• Time

• Cost

• Quality

• Communication

• Human Resources

• Risk

• Procurement

• Safety

• Environment

• Finance

• Claims

Integrating Project Processes And

Knowledge Areas


Contemporary

Techniques Used in CPM

• Three Breakdown structures – PBS, OBS, WBS

• Bar charts, Network analysis using PERT / CPM/ PDM/GERT

• Critical Chain Methods (CCM) based on TOC

• S – curve, EVM / EDM mainly for project monitoring

• Simulation, risk matrix, risk register and other risk analysis methods

• AHP, Fuzzy networks, other multi criteria methods

• Responsibility matrix, competency assessment tools, soft skill labs

• Software such as MS Project, Oracle Primavera, Project Professional,

CANDY, Palisade, BRICS, etc

• Cost estimation and forecasting models

• Critical success factors


Contemporary

Case of Denver International Airport Project

• In 1980s, Denver Stapleton Airport had overgrown its capacity levels.

In 1989, voters approved a new modern airport to be completed by fall

1993

• Clear mission, stable funding, great economic benefits expected,

necessary political backing

• One of the largest tenants, United Airlines, required an automated

baggage handling (ABH) system to turn the aircraft around in <30 mins

• In Dec 1991, it commissioned BAE Automatic Systems Inc to design

and implement the system with an estimated schedule of 2.5 years


Contemporary

Case of Denver International Airport Project

• The baggage handling system was a “high tech” project, requiring

several design cycles and extensive testing. BAE familiar with building

ABH systems, on a much smaller scale

• The new technology, large number of entities to be served, high degree

of technical uncertainty and short time span were critical factors

• What was expected to be a standard, large construction project,

became a nightmare for its stakeholders and resulted in enormous

delays and excessive costs

• Airport finally opened for business in Feb 1995, 16 months late and

$ 1.5 billion over budget. United to use the BAE system only for its

terminal concourse


Contemporary

The Chunnel Project

• Underground 32 mile double rail tunnel for through trains and special

car & truck carrying shuttle trains. Planning period 1974-86.

• Transmanche Link (TML) awarded contract. Channel Tunnel Group /

FranceManche (Eurotunnel) owner of 55 year concession for the link.

Bid price US $ 5.5 billion, eventually increased to US $ 14.9 bln

• Multinational team above and below the ground. 15000 workers

• The Treaty of Canterbury and IGC coordinated the approach,

construction, operation, and safety of the tunnel

• Implementation started in 4 th quarter of 1987. Ended on Dec 15, 1994.

Project handed over fully operational. Impressive quality


Contemporary

The Chunnel Project – Development, Implementation, Close Out

• Eurotunnel responsible for 70 % cost overruns on original contract and

TML for 30 % ( max 6 % of total ). In 1990, Eurotunnel for £ 1.58 billion

overrun and TML for 30 % of everything above

• World’s largest privatized project. Difficult due to inflexibility of project

characteristics, cross cultural exchange between two countries, two

languages

• State of art laser and computer technology to bore tunnel and test rail

system. Amazing feat of excavating three tunnels so close together

and meet in right spot in both countries


Contemporary

The Chunnel Project - Multiple Problems

• New technology and modifications during project due to unexpected

conditions and changes. Ex : French used sophisticated equipment to

grout on their side

• IGC approved designs not in original concession agreements

• Safety changes by IGC created - ve schedule variances affecting 12

tunneling faces excavated by 11 TBMs

• “ The Higher of the Two Standards” created schedule delays. Change

from 600 mm doors to 700 mm doors causing 9 month delay

• Near the end of the project, requirement of A/C system to cool the

tunnel leading to US $ 200 million scope increase.

• “ Bare Minimum” approach to cost estimating and contract awarding

left no operational reserves


Contemporary

The Chunnel Project - Multiple Problems

• Communication between French and English sides limited. Two teams on opposite ends, working towards middle without communication

• Ill defined Scope and FP contracts. Assume “Best Case Scenario” and

use “ Changed Conditions” to justify claims

• Loan financing raised by consortium of 206 banks worldwide. Banks given too much leeway and control

• Conflict of Interest between subcontractors and TML, between TML and CTG / FM. Some contractors investors (JVs) with CTG / FM winner. Cooperation and teamwork in 3.5 years of tunneling, overshadowed

• Funding by private sources, contractual errors in estimates and risk allocation, multiple methods of compensation led to US $ 2.25 billion claim against Eurotunnel by the TML

• Several arbitration bodies incl International Chamber of Commerce involved to resolve key portions of the complex claims

•


Contemporary

Five Dimensions of Project’s Success

• Project efficiency

• Impact on customer

• Impact on the team

• Business and direct success

• Preparation for the future


Contemporary

Short Medium Long

Efficiency

Impact on customer

Impact on team

Business and direct success

Preparation for future

Success Dimensions

Time Frame

Project Success

The Diamond Framework – RPM Mpdel


Contemporary

Super high tech

High tech

Medium tech

Low tech

Assembly

System

Array

Regular

Fast / competitive

Time critical

Blitz

Derivative

Platform

Breakthrough

Technology

Novelty

Complexity

Pace

The Diamond Framework –

NTCP Model


Contemporary Pace

Regular

Fast/Competitive

Time Critical

Blitz

Description

• Time not critical to immediate project success

• Most common project carried out by industrial organizations

• Must be completed by a specified date

• Most urgent, most time critical. Crisis projects

Novelty

Derivative

Platform

Breakthrough

Description

• Products / projects are extensions and improvements of

existing products / projects

• New generations of existing product / projects.

• Products / projects are new.

Complexity

Assembly

System

Array

Description

• Elements, components, modules combined into a single unit

• Complex collection of elements and subsystems

• Large, widely dispersed collection of systems

Technology

Low Tech

Medium Tech

High Tech

Super High Tech

Description

• Rely on existing and well established technology

• Use existing/base tech but adopt new tech/ feature

• Most tech new to firm, already exist, available at project start

•New tech must be developed during the project


Contemporary

Super high tech

High tech

Medium tech

Low tech

Assembly

System

Array

Regular

Fast / competitive

Time critical

Blitz

Derivative

Platform

Breakthrough

Dar = ( PI, LT, Ar, TCr )

Dba= ( PI, HT,Sy, TCr )

Technology

Novelty

Complexity

Pace

Denver International Airport

Project

Airport Construction

Project

Automated Baggage

Handling Project


Contemporary

Super high tech

High tech

Medium tech

Low tech

Assembly

System

Array

Regular

Fast / competitive

Time critical

Blitz

Derivative

Platform

Breakthrough

Dr = ( PI, MT, Ar, Re )

Da = ( PI, HT, Sy, FC )

Technology

Novelty

Complexity

Pace

The Chunnel Project Require Style

Actual Style


Contemporary

Sr No Planning Type Features

1 Lean Principles • Eliminate waste, pursue CI. Let customer pull

• Specify value for ultimate customer and identify value

streams

• Deliver things right first time

1 Project Design • Techniques like Virtual Reality and 3D CAD

• Integrated design / build

• Design for Standardization and Pre assembly

2 Project

Procurement

• SC rationalization, vendor partnering, modularization

• Transparency/ confidentiality of costs / cash flows

• JIT delivery of materials to point of use

3 Project Human

resources

• Clear communication

• Training, teamwork, multi skilling

• Motivated, well trained, flexible, fully engaged workforce

4 Panning

Techniques

• Initial Planning, Look Ahead ( LA ) Planning, Weekly Work

Planning (WWP), Last Planner (LP), Linear Scheduling Method

(LSM), Daily Graphical Schedule


Contemporary

Main Components of T5 Supply Chain of T5 Structure of T5

Two large terminal buildings

An Air Traffic Control Tower

Road and Railway

transportation links

13 kms of bored tunnels

Over 60 aircraft stands

A 4000 space multi storey

car park and a hotel

An automatic baggage

handling system

Airfield infrastructure

T 5 supply chain

included suppliers as

follows :

80 first tier

500 second tier

2000 third tier

5000 fourth tier

15000 fifth tier

Subdivided into :

1000 work packages

16 major projects

147 sub projects

Smallest sub project of $

2 milln to larger projects

such as $ 600 milln

Heathrow Express

underground rail station

Overview of T 5 Project

• Increase Heathrow’s Capacity from 67 to 95 million passengers a year. BAA

Owner. High Q Infrastructure delivered on March 27, 2008. Total cost US $ 8.5

billion.


Contemporary T5 Project Life Cycle

1985 1990 1995 2000 2005 2008

1. Planning Phase – 1986 until Sep 2002

2. Design Phase – 1989 Until Around 2004

3. Construction Phase –

Sep 2002 Until 27 March 2008

4. Operational Phase – Final

Six Months Prior to Opening

Operations


Contemporary

Recombination Steps in T 5 Project

• Core team explored alternative practices, technologies and ideas from

other industries & mega projects

• “ Doing It Differently” - the guiding delivery strategy

• Independent T 5 organization. Freedom to experiment and innovate

• Benchmark every UK construction project over $ 2 billn in past 10 years

and every international airport opened over previous 15 years

• No UK construction project successfully delivered on time, within

budget, to quality and safety records

• Without a radically different approach, T 5 project would be $ 2 billn over

budget, delivered 1 year late and result in 2 deaths

• Two major causes of poor performance : lack of collaboration among

project partners and client’s reluctance to assume project risks


Contemporary

BAA’s Model of Mega Project Management

– Systems integration to coordinate design, engineering, integration

and delivery of a fully functioning operational system

– Project and program management to support an integrated supply

chain

– Off site fabrication, pre assembly, and modular production to

improve productivity, predictability, health and safety

– Just in Time logistics to coordinate the supply of materials, to

increase speed and efficiency

– Operational integration to undertake systems test, trials, and

preparation for hand over to operations


Contemporary

Best Practice Best Practice

• Coordinate system design and

integration, testing, handover trials

• Risk bearing/risk sharing approach

• Cost plus incentive approach.

• Incentives for innovation

• Profits shared among partners

• Framework Supplier Agreements

• Physical prototyping and testing of

components and subassemblies

• Materials & components delivered JIT

• Use of offsite consolidation centres

•Training and familiarization of staff

• Consistent process of gateways and

milestones to control project

• Concurrent engineering to integrate

design, fabrication and construction

• Collaborative PM software tools

•Single Model Environment ( SME )

• Digital prototyping and visualization

for design and construction

• 3 D and 4 D modeling, clash detection

• Offsite manufacture of components

• Offsite pre assembly

•Software tool for logistics and project

Some Lessons From Mega Projects


Contemporary

What Should We Do ?

• Develop Leaders for PM

• Deploy project management system for professional PM practice

• Organize around well defined PM processes and knowledge areas

• Define and measure project success for customers and stakeholders

• Innovate to manage complex project supply chains

• Innovate Best and Next Practice PM - Adopt Lean Project Management

( LPM ); Leverage IT/CT Solutions For PM; Deploy Process Technology

• Focus on Talent Development and Management

• Develop and assess key competencies for project management

• Embrace green and safe PM

• Develop effective stakeholder management system

• National approach for education, training, research, certification


Contemporary

Supply Chain Characteristics

• Project SCs comprise : designers, consultants, technical specialists,

contractors, sub contractors, vendors, service providers

• Wide variations in capabilities and competencies across SC - design,

consultancy, technical talent, specialized technology and vendors.

Impact project value delivery

• Extremely limited high end contracting capabilities such as EPC, Prime

Contracting, Design Construct, etc

• Coordination & integration of SCs a formidable challenge. Built on “

Outsourcing ”, SCs need durable, sustained SC relationships

• Project productivity, quality, cost, delivery need upgradation to world

class standards and benchmarks


Contemporary Type

Level

Skilled

Worker

Supervisor Engineer/

Executive

Specialist Manager

Top Multi

project /

verticals/

Business

leadership

Senior Multi skilled Large site /

off shore/

overseas

Large/

overseas /

offshore

Competency

verticals

Project

Leadership

Middle Proficient in

single skills

Multi

function /

small site

Multi

discipline /

project

Multi

discipline /

project

Functional

Entry Basic skills

apprentice

Single

function

Single

discipline

Single

discipline /

task

Induction

A Talent Development Matrix For AEC Companies


Contemporary

Knowledge

Performance

Organizational Industry Specific

Personal

Complete CPMA Framework


Contemporary

Sr No Competence Description

1 Knowledge Integration, scope, time, cost, quality, human resources,

risk, procurement, safety, environment, finance, claims

2 Performance Initiating, Planning, Executing, Monitoring and

Controlling, Closing a project

3 Personal Communicating, Leading, Managing, Cognitive Ability,

Effectiveness, Professionalism

4 Organizational Skills and competencies specific to particular

organization and jobs

Assessment based on organization specific competence

definitions

5 Industry

specific

Skills and competencies specific to particular industry

Assessment based on industry specific competence

definitions

Brief Descriptions of Competencies


Contemporary

Thank You

8. dr. mangesh korgaounker project management presentation

Documents

project sector

construction project

india mega project financing

municipal projects

capacity of projects

infrastructure projects

largest employment projects

construction account