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2017 RICE GLOBAL E&C ANNUAL FORUM
www.forum.rice.edu
Long Term and Near Term Approaches on Productivity Improvements –
Where’s my Silver Bullet???
Jim Rammell14November2017
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2017 Rice Global E&C Annual Forum
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facts…3
A new global
leader in technical,
engineering and
project services
FTSE 100 listedover $11bn revenue
Over 160 years
experience
Operating in more
than 60 countries
WG.100$11BN
16060+
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purpose…4
we deliver performance-driven solutions throughout
the asset life cycle, from concept to decommissioning
across a broad range of energy and industrial markets
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purpose…5
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purpose…6
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purpose…7
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“Houston, we have a problem…”8
Long Term and Near Term Approaches on Productivity Improvements –
Where’s my Silver Bullet???
2017 Rice Global E&C Annual Forum
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“Houston, we have a problem…”9
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“Houston, we have a problem…”10
For Mega-Projects*:
• 98% of Projects incur cost overruns or delays
• The average cost increase is 80% of the original value
• The average slippage is 20 months behind original schedule
* From 08Sept17 McKinsey Rice E&C roundtable2017 Rice Global E&C Annual Forum
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BUT WAIT!!!11
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“Houston, we have a Solution…”12
LONG TERM
NEAR TERM
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“Houston, we have a Solution…”13
Striving to Improve Productivity…
• Long Term
• Near / Short Term
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Productivity – Long Term14
Long Term…
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Productivity – Long Term15
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Productivity – Long Term16
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Productivity – Long Term17
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Productivity – Long Term18
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Productivity – Long Term19
Long Term…
• Data Analytics
• Combination of Incremental Improvements
• Technology
• Contract Structure
➢ Collaborative Approaches (Integrated Project Delivery)
➢ Upfront Planning
➢ …
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Productivity – Near / Short Term20
Near / Short Term…
• Advanced Work Packaging
• Contract Structure
➢ Collaborative Approaches
➢ Upfront Planning
➢ …
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What is Advanced Work Packaging?
Work planning that emphasizes construction requirements
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2017 Rice Global E&C Annual Forum
AWP Discussion Points
Foundational Background
Benefits
Implementation Challenges
AWP Actions
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Traditional Work Packaging
has been done on every project since the pyramids.
is a formal/informal process of understanding and performing field work.
is accomplished inconsistently.
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CII RT 272/319 Contributions: A Model for Advanced Work Packaging
Productivity & Predictability
Safety, Quality, Alignment, Communication, Reduced Rework
Contracts Practice Model Tools Example
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Maturity Model
Three AWP Maturity Stages conceptualized within CII IR 272-2, Volume II
Objectives:
1. Provide empirical evidence of the three stages.
2. Investigate the relationship between AWP maturity and project performance.
3. Deliver practical recommendations to obtain higher levels of AWP maturity.
Level 2: AWP Effectiveness
AWP is seen as part of the
business solution - being both an
opportunity and a challenge.
Integration of AWP strategies are
routinely developed and updated.
These often seek to overcome
integration and communication
issues across project
organizational units (silos). AWP
is now included in all contracts.
Work processes and deliverables
for individual business functions
or departments are mostly well
defined and standardized.
Integration of these processes are
still problematic across functional
unit lines. Frustration will be
experienced when some functions
are progressing towards AWP
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Maturity Model – Case Study Evaluations
A. Productivity
B. Cost
C. Safety
D. Schedule
E. Quality
F. Predictability
Project Performance
A. Process Adherence
B. Organizational Alignment
C. Contract Integration
AWP Maturity
Results:• 60 ratings on 15 different projects.
• Independent ratings (RT319 experts).
• Two dimensions of analysis:
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(1) Recommendation in AWP Early Stages
1
AWP Early Stages
AWP Early Stages• Set small project goals.
• Allocate adequate budgets.
• Identify key roles to drive AWP implementation.
• Perform intensive training.
AWP Maturity
Pro
ject
Pe
rfo
rma
nce
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(1) Performance in AWP Early Stages
Performance
Dimension
Maturity Stage
1 – AWP Early Stage
ProductivityAround 10%
improvement
Cost Project on budget
Safety
0 lost-time accident
(TRIR below company
average)
ScheduleProject experienced
minor delays
PredictabilitySignificant deviation
from baseline estimates
Quality
Rework in line with
previous quality
performance
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(2) Recommendation in AWP Effectiveness
1
2
AWP Early Stages AWP Effectiveness
AWP Maturity
Pro
ject
Pe
rfo
rma
nce
AWP Effectiveness• Set ambitious project goals.
• Prioritize incremental improvement projects.
• Watch out for complacency.
• Attain to AWP guidelines.
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(2) Performance in AWP Effectiveness
Performance
Dimension
Maturity Stage
1 – AWP Early Stage2 – AWP
Effectiveness
Productivity Around 10% improvementAround 25%
improvement
Cost Project on budgetTIC 10% below
estimates
Safety0 lost-time accident (TRIR
below company average)
0 lost-time accident
(TRIR improves with
sporadic first-aids /
near misses)
ScheduleProject experienced minor
delays
Project slightly ahead
of schedule during
execution
Predictabilit
ySignificant deviation from
baseline estimates
Minor changes to
execution schedule
QualityRework in line with previous
quality performance
Rework slightly below
company's average
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(3) Recommendation in AWP Biz. Transformation
1
2
3
AWP Early Stages AWP Effectiveness AWP Business Transformation
AWP Maturity
Pro
ject
Pe
rfo
rma
nce
AWP Business Transformation• Continue investing in AWP implementation.
• Increase the flexibility of project managers to evolve/adapt AWP processes.
• Export the project as “world-class” benchmark.
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(3) Performance in AWP Business Transformation
Performance
Dimension
Maturity Stage
1 – AWP Early
Stage2 – AWP Effectiveness
3 – AWP Business
Transformation
ProductivityAround 10%
improvement
Around 25%
improvement
Around 25%
improvement
Cost Project on budgetAround 10% below
TIC
Around 10% below
TIC
Safety
0 lost-time
accident (TRIR
below company
average)
0 lost-time accident
(sporadic first-aids
and near misses)
0 lost-time accident
(sporadic first-aids
and near misses)
Schedule
Project
experienced
minor delays
Project slightly
ahead of schedule
during execution
Project slightly
ahead of schedule
during both planning
and execution
Predictability
Not very
satisfying (major
changes to
estimates)
Moderately positive
(minor changes to
estimates)
Execution schedule
to plan
Quality
In line with
previous quality
performance
Reworks slightly
below company's
average
Rework substantially
below company
average +
substantial reduction
in RFIs
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Productivity
Cost
Safety
Schedule
Predictability
Quality
Project Performance with AWP
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Managerial Implications
AWP Early Stages AWP Effectiveness AWP Business Transformation
AWP Maturity
Pro
ject
Pe
rfo
rma
nce
• Set achievable project goals• Allocate adequate budget during planning• Identify key roles to drive AWP implementation• Perform intensive training for all key participants
• Continue investing in AWP implementation• Increase the flexibility of project managers to
evolve/adapt AWP processes• Export the project as “world-class” benchmark
• Set ambitious project goals• Prioritize incremental improvement projects • Watch out for complacency• Attain to AWP guidelines
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2017 Rice Global E&C Annual Forum
AWP Implementation Challenges
Qualified Companies
Qualified Individuals
UH Students
Train Current EE’s
“only thing worse than training your employees and loosing them…
…is not training them and keeping them!”
Keeping the Momentum
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2017 Rice Global E&C Annual Forum
AWP Actions
Call to Action
Name a Champion
Share your Wins
Engage Others
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2017 Rice Global E&C Annual Forum
Path Forward
Continue Long Term Research
Continue Near Term Implementations
Celebrate Successes
Engage Others