plan for integrating new technology into high-risk programs...

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Plan for Integrating New Technology into High-risk Programs: National Academies ad hoc Committee on conversion from HEU FuelRisk-Based Management of Programs and Projects with Technical Uncertainties

M. David Maloney, Ph.D. Technology Fellow Emeritus CH2M HILL Nuclear GroupTechnology Leadership Board April 15-16, 2015

Copyright by CH2M HILL • Company Confidential

Discussion Outline

■ Risk-based Methodology – Decisionmaking practice at Rocky Flats and other

DOE/NNSA weapons sites

• Case study of a successful program and project management method

■ Role of End State Acceptance – Fixed Definition

– Variables

• Sustainability factors


“Reengineering” + Technology = ∆ Cost + ∆ Schedule $37B/2060 $7B/2010 $6B/2006


Some Program, Project Management Terminology used here

■ Work Breakdown Structure – WBS – Activity level detail

■ Work Precedence Network – WBS + logic/dependencies

■ Activity duration, schedule – Gantt

■ Critical Path – baseline, technical plan


Rocky Flats – features, challenges, uncertainties

■ Weapons components manufacturing mission – HEU, LEU, TRUs –Pu, …, Be, … process chemistry, residues – Attractiveness Level, Stabilization – Packaging, Transportation – Disposition for Storage or Disposal – Facility Decommissioning and Site Remediation

■ Many first-of-a-kind problems and technologies required ■ Interdependence among multiple sites and agencies

– RD&D in real time (insertion at specified points) – Supply of special materials and equipment to RF – Receipt/Acceptance of materials from RF – Technology- and Process-Readiness at other sites


Systems Approach

■ Projectize the Program ■ Project Integration

– Technology

– Contract – Regulations, Codes, Standards

■ Technology Intragration – Tool-box components

– Complete flow sheet – Detailed activity level

■ Key is risk-based planning


Elements of Risk

■ Technology ■ Cost ■ Schedule ■ Externalities ■ Safety, Public Health, Environment ■ End State Definition ______________________________

■ Objective: Monte Carlo the Program and Project Management Plans


The risk fulcrum:PM Approach to Technical Complexity

■ Multi-year target cost/schedule through completion ■ For each project:

– Pre-baselined technology innovation

• Continuous tech improvement implicit in target cost/schedule

– Performance metrics

• Set to enable long-term bets and hedging

• Enable rearranging of activities and resources – Shared technology responsibility and risk


PM Approach to Technical Complexity (the risk fulcrum cont’d)

■ Programmatic risk-based management required – PRA must be continuous throughout the project

■ Risk mitigation requires pro-active planning and funding of off-baseline technology alternatives

■ Rolling Wave Method - pros and cons – Get started, but don’t lock down; build on-ramps for new

technology and technical approaches

– Multiple pathways, real-time problem solving – Note: Initial state uncertainties, end state options impact the risk profile


Risk Informed Management System in Practice

■ Critical Path is statistical/probabilistic – on-baseline is not deterministic; must also

pursue…

– … off-baseline/near-baseline activities that may become critical

■ Technology risk, Schedule risk, External risk assigned for each activity – range and distribution for each risk are estimated

■ Detailed activity level baseline and BOE are essential


At-Risk Activities

Ranking of activities per risk

Pareto Chart of Project Risk

25

75

100

125

Ris

k C

alcu

latio

n

1312111098765432 171615141

Event Number

50

“Break in Pattern”


Put in the Fix

Scheduling risk mitigation


Monitor Performance Indicators


Implications for Technical Planning ■ Rigorous and detailed risk evaluations up front

– “what could go wrong?” vs. “what now?” – slow down to speed up … or, “fast = half fast”

■ Identify and focus resources on the weak links in the intrasystem – without detailed baseline/CP, the weak links are missed in the PRA

■ Pursue both improved and alternative tech in parallel

■ Anticipate the train wrecks and concentrate resources on the identified risks before they become problems

■ Game the technology bet … play to win


Technology Roulette…“Hedging the Technology Bet”

■ Pursue multiple pathways until the risk is under control

■ Place bets both on- and off-baseline ■ Place bets on competing approaches, not just

competing technologies ■ One-thing-at-a-time achieves some breakthroughs

but results in an odds-on overrun of the total project – Technical complexity multiplies the risk, reduces the odds of

success, increases the need for risk-informed management


Other Enabling Conditions

■ Regulatory – Foster collaboration from the outset with local, national,

and international agencies

– Public involvement and communication critical ■ Funding Predictability for Program and Project Managers

– Reliability, timing of funds needed for parallel scheduling (on-baseline and off-baseline; on site and off site)

■ Contract Terms – Incentivize innovation

– All parties have a stake in financial, security, worker and public safety outcomes


Integration of Technology and Regulatory Programs

■ Just ask … just say yes – technical basis and equivalent performance cases

promoted by DOE EM (HQ) and RFETS (site) with several successes

■ Regulations, orders, standards, WACs . . . should be performance-based – technology-based standards work against

potential break-through technologies


Project DynamicsTechnology Funding Implications

■ Issue: Predictability for project managers – reliability, timing of funds are essential for Rolling

Wave

■ “Money Critical Path” – corollary to technical baseline

– independent constraint – continuous recalculation

■ Rework the plan per WISE model


sum up Decision Tools - iterative

■ WISE model – “What-If Scenario Evaluation”

■ Project Planning and Integration – rebaselining

■ Programmatic Risk Assessment


Outcomes

■ Prioritize technology – “80/20” rule ■ Schedule technology -- windows of opportunity ■ Support WISE -- bottom line impact ■ Productivities

– SNF, D&D, WM, ER

– Processes, Instrumentation, IS

– Management, consolidation


End State Mission■ Fixed Mission

– Closure site/part of site

– Standards fixed per location reuse ■ Variables

– Cost vs. clean up levels – Environmental and health risk assessments – Informed agreements with stakeholders essential

■ Sustainability Issues – life cycle analyses – Private sector and community drivers – DOE provides infrastructure assets – Flexible management system responsive to investor/user needs

• Schedule risk is enhanced • Premium on schedule predictability and asset availability


Project Performance (Baseline)Cost and Schedule Variances

Varia

nce

($ T

hous

ands

)

-$50,000

$62,500

$175,000

$287,500

$400,000

Cost Variance +

$251M (+7.1%)

Schedule Variance +

$254M (+7.8%)

Feb00 May05


Nuclear Site Infrastructure Assets

■ Land ■ Water ■ Connected grid ■ Security ■ Transportation ■ Skilled work force ■ Enlightened regulators ■ Educated communities ■ National Labs and strong university alliances bottom line: investment resources

Add picture of transmission line, substation, etc.


2000

2005

Thank you!

backup slides for potential questions


Project Definition

Legal & RegulationsCodes &

Standards

Economics

Financing

InstitutionsContract

Terms

Logistics

Human Resources

Battery Limits

Externalities

OperationsTechnology

Mix

Integrate


Contracting Approaches

■ M&O Concept – CPFF/Award Fee – Risk largely retained by DOE – Risk - reward opportunities limited

■ M&I Concept – Performance measures/activity milestones/fees – Risk - reward transferred to contractor – Period of performance for activities and contract narrowly defined


M&O M&I CR Impact on Innovation

■ Productivity incentivized as risk-reward transferred ■ Fee curve through completion alleviates problem of short-term

milestones ■ Efficiencies baselined up front; technical innovation implicit in

target cost/schedule ■ Risk mitigation requires pro-active planning and funding of off-

baseline alternatives ■ Innovation risk hurdle is raised


Sustainability Practices

■ Green remediation – “net benefit from cleanup actions” (EPA) – well underway at DOD sites

■ Waste mgmt (legacy, D&D, ER) – targets: waste/disposal min ■ Water mgmt – targets: conservation and zero discharge ■ Energy mgmt (fac utilities, vehicles, cats, power, …) – targets:

carbon, GHG min ■ Materials selection & use – targets: degradable, reusable ■ Deconstruction methods employ all of the above ■ Procurement – sustainable supply chain (w/ life cycle assessment


Energy-Technology Parks

■ Energy Park Initiative/Asset Revitalization -- EM programs ■ Site assets converted for economic development

– Focus on green energy and technology-based economic development (TBED)

■ DOE site assets: land, water, connected grid capacity, transportation infrastructure, educated workforce, enlightened communities and regulators

■ DOE has designated a local economic development organization lead for major sites

■ Opportunity to provide well-conceived plans to optimize use of assets and private industry sustainability

plan for integrating new technology into high-risk programs...

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