reliable afe’s key drivers on mega projects jose c. herrero, vp project director fluor
TRANSCRIPT
RELIABLE AFE’sKEY DRIVERS on MEGA PROJECTS
Jose C. Herrero, VP Project Director Fluor
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RELIABLE AFE MEGA PROJECTSRELIABLE AFE MEGA PROJECTS
RECENT EXPERIENCES
EFFORT/TIME for a RELIABLE AFE
KEY DRIVERS
CONCLUSION
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RELIABLE AFE MEGA PROJECTSRELIABLE AFE MEGA PROJECTS
RECENT EXPERIENCES– Quality– Safety– Schedule– Cost
DO WE HAVE ANY HOPE ?
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EFFORT/TIME TO DEVELOPRELIABLE AFE MEGA PROJECTSEFFORT/TIME TO DEVELOPRELIABLE AFE MEGA PROJECTS
Gating Process
Terminology
Engineering Effort
Duration
Accuracy and Confidence Level
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
6 Basic Elements – Scope of Work (Facilities and Services)– Cost Estimate– Schedule– Execution Plan and Change Management– Risk Management– Prime Contract
Consistency
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
SCOPE OF WORK– SOS and SOF– Methodologies– Suitable for the Purpose– Support AFE Estimate– Consistent with AFE Schedule– Written endorsement by stakeholders
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
COST ESTIMATE– Translate the Base Line into cost and contingencies – Identifies anticipated cost of Project Execution– Input by all stakeholders – Upper Management reviews– Escalation – Contingency assessment– Event Driven Risks– Stated level of probability– Consider an intermediate estimate
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
SCHEDULE– Start with the end in mind– Articulate and visualize the Path of Construction– Precedence diagram– Benchmarking– Modularization– Resource loaded and leveled– Stated level of probability– Risk assessment
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Schedule Considerations ISchedule Considerations I
Engineering
Construction
Time T
% C
om
ple
te
0
0.1
0.2
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1
1/3T
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Schedule Considerations IISchedule Considerations II
10 20 30 40 50 60 70 80 90 10000
100
10
20
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40
50
60
70
80
90
ENGINEERING
CONSTRUCTION
CHECKOUT/STARTUP
Percent of Total Contract Time
Pe
rce
nt
Co
mp
lete
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Schedule Considerations IISchedule Considerations II
10 20 30 40 50 60 70 80 90 10000
100
10
20
30
40
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ENGINEERINGMODULES ONLY
CONSTRUCTION
CHECKOUT/STARTUP
Modularized Project Life Cycle
Percent of Total Contract Time
Pe
rce
nt
Co
mp
lete
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Schedule Considerations IIISchedule Considerations III
25% T
15% T
T
Construction Progress versus Duration
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Construction Duration
Pro
gre
ss
Site Prep, Piling, etc.
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
PROJECT EXECUTION PLAN – Strategy to meet contractual requirements– Execution Flow Chart– Project Management structure– Basis for the AFE Estimate/Schedule– Addresses the Total Project– Written endorsement of all stakeholders– Includes the Change Management Plan
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
CHANGE MANAGEMENT PLAN– Definition and Alignment– Different responses– Change Management Process– Deal with all changes promptly– Change Management log– Direct Impact and Disruption
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Where do you stand as a PM?Where do you stand as a PM?
Could Be Should Be
We manage and report services cost, but don’t drive to it
Manage and drive TIC and schedule to the Baseline
Maintain a current Baseline through effective Change Management
We forecast TIC, don’t manage to it
We don’t manage or forecast schedule, but drive to it!
The only thing that’s missing is a conversation.As Manager, I am responsible for the way it is.
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
RISK MANAGEMENT– Guided and facilitated– Formal and systematic– Assess, mitigate, manage execution risks– Integrated and positive approach– Proactive and forward looking – Updates– Other benefits
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KEY DRIVERS forRELIABLE AFE MEGA PROJECTSKEY DRIVERS forRELIABLE AFE MEGA PROJECTS
PRIME CONTRACT– Legal relationship– Reimbursement, liabilities, notifications– Documents commitments– Notification matrix– Can’t cover all eventualities– Behaviors
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CONCLUSIONYES, THERE IS HOPE!CONCLUSIONYES, THERE IS HOPE!
No replacement for experience
Alignment
Mega Projects are RISK projects
Decision making process
Different execution models
Solid organization, populated with competent/experienced people and proven work processes