PROJECT MANAGEMENT COMPONENTS

INTRODUCTION 

The management of most of major Projects is generally contracted out by owners to organizations having expertise in the field. With this in view, owner satisfaction becomes an important criterion for the project management team. The management team focuses on the following five major components leading to the owner satisfaction:

 

1.       Scope

2.       Time

3.       Cost

4.       Quality and

5.       Performance 

 

1.    Project Scope

Project scope describes the work required to deliver the product or service with the intended requirements to the satisfaction of owner. It describes the intended quality, features, and functions of a product or a service often in minute detail. Every project produces a unique product that is either a tangible item or service. Project owners usually have some expectations about the features and functions of products which are detailed out in the project scope document. Documents that outline this information are generally called product specifications. A service or event usually has some expected features as well.

A Scope document identifies the requirements to achieve the defined end results. The document is expected to define what the project is supposed to accomplish, and a specific description of the end result expected be accomplished. A major component of scope is the quality and performance of the end product.

The scope document is meant to ensure that everyone on the project team understands what is expected of them during the execution of the project. In addition, all work that can be reasonably predicted must be ascertained and reported in the document. Suitable scope definition is essential for the success of the project and needs to be given due consideration and thought.

The scope and objectives are always project specific. Most of the major projects do have common features on the scope document which is generally broken down under the following Sections:

1)       Project Description

2)       Project Controls
3)    Engineering that includes

      a)       Process

      b)       Mechanical

      c)       Piping

      d)       Civil & Structural

      e)       Electrical

      f) Automation/Instrumentation & Controls
     g) Telecommunications

4)       Procurement

5)   Environmental & Regulatory

6)   Construction Logistics

7)   Operations & Maintenance 

A description of the above follows:

1.1              Project Description

Typically this section contains: 

1)       A detailed description of the project

2)       Project Location Details

3)       Project Units

4)       Facilities

5)       Accommodation requirements (permanent)

6)       Construction Camps

7)       General infrastructure

8)       Power Generation

9)      Waste Disposal

10)   Warehouse & Storage requirements

11)   Other project specific items

1.2              Project Controls:

The Project Controls include:  

1)       Preparation of Cost Estimate at different stages

2)       Preparation of DBM (Design Basis Memorandum)

3)       Prepartion of Project schedules through initial stages to start-up and commissioning

4)       Progress Reports

5)       Progress Evaluation Reports
6)   Man-hour forecast and consumption Reports

1.3              Engineering:

Engineering for any project. Engineering is sub-divided into the following major disciplines:

a)       Process

b)       Mechanical 
c)       Piping

d)       Civil & Structural

e)       Electrical

 f)   Automation/Instrumentation & Controls
g)   Telecommunications

Process

The process development for a project includes:  

a)       Process Description

b)       Process Studies to be done during the course of project execution

c)       Process Models to be prepared and tested during the course of project execution

d)    Process Deliverables. This section details out the process deliverables, though this list is project specific, but typically contains:

e)       PFDs (Process Flow Diagrams)

f)        Heat and material balances

g)       Utility load lists

h)       Line list

i)         Design philosophy

j)         Tank schedule with basis of usage, volume and time between refills

k)       Expected Fuel Consumptions during the operation phase

l)         A list of chemicals with estimated quantities required during the operation phase.

m)     P & IDs

 n)       Initial start-up and black-start philosophies

 o)       Safety and operability analyses

 p)       HAZOP analysis

 q)       Flow assurance and mitigations plans

 r)        Systems Criticality list

 

Mechanical:

This section represents the mechanical details of the project and includes:

 

1)       A description of Mechanical Equipment

2)       Mechanical Studies to be done during the course of project execution. Some typical studies include:

3)       RAM (Reliability Availability and Maintainability) study

4)       Vessel location study

5)       Vessel design code optimization Study

6)       Inlet piping design coding study

7)       Noise Study

8)       Refrigeration compressor driver selection Study

9)       Gas compression selection Study

10)   Equipment design temperature study

11)   Mechanical Deliverables

12)   The Mechanical Deliverables are project specific and include:

13)   Mechanical equipment list

14)   Mechanical equipment data sheets

15)   Identification of Long Lead Equipment

16)   Stress analysis

17)   Material selection diagrams

18)   Piping Specifications

19)   Heating Ventilation and Air Conditioning design philosophy & Calculations

20)   Equipment Requisitions & Tender documents for Long Lead & Critical Equipment

21)   Utility supply plan

Piping

This section represents the Piping details of the project and includes: 

1)       A description of Piping Network

2)       Plot Plan

3)       3D PDS generated model

4)       Smart P&IDs

5)       Site plan

6)       Construction Site Plan

7)       Facility Egress and Access Plan

 

Civil & Structural 

This section describes the civil & structural items and includes:

1)       Civil & Structural Studies to be done during the course of project execution. These are project specific.

2)       Civil & Structural Deliverables. Again these are project specific and may include items like:

a)       Basis of Civil & Structural Design

b)       Soil and geotechnical evaluation

c)       Site location plan

d)       Site grading plan

e)       Foundation design and drawings

f)        Structural design methodology

g)       PDS Framework

h)       List of Buildings

i)         Building layouts

 

Electrical

This section describes the Electrical Engineering items and includes:

 

1)       Electrical Studies:

2)       Though most of the project studies are led by other disciplines, but these need input from the electrical department.

3)       Electrical Deliverables generally include:

a)       Preparation of electrical specifications

b)       Critical single line diagrams

c)       Equipment interface philosophy

d)       Area classification drawings

e)       Electrical load list

f)        Electrical equipment list

g)       Electrical data sheets

h)       Electrical design basis

i)         MCC building layouts

j)         Emergency power system design basis

k)       Packaged Cable routing study

l)         Construction Plan for Power

Automation/Instrumentation & Control

Instrumentation and Controls Deliverables include:  

1)       Communication study

2)       Field Bus Study

3)       Common control center study

4)       Instrumentation and controls equipment specifications

5)       Controls philosophy/measurement philosophy

6)       Instrument index/ I/O list / specialty valve list

7)       Instrument data sheets (in-line instruments and specialty items only)

8)       SIL philosophy

9)       Control room location and layout

10)   Preliminary ESD and PSD keys

11)   Long lead items list

12)   Constructability review

13)   Preliminary design risk assessment

14)   PCS and PSS equipment lists

15)   Control system architecture and layout

16)   Process operations surveillance system

17)   Security functional requirements documents

Telecommunications

1)   Telecommunications philosophy

2)   Communications scope of work and interface matrix

3)   Communications equipment specifications

4)   Communications equipment lists

5)   Communications block diagrams

6)   Communications block diagram

 

 

1.4              Procurement

Procurement supports the following:

1)       Procurement Plan

2)       Contracting Plan

3)       List of Purchase Orders

4)       List of Contracts & Sub-Contracts

 

1.5          Environment and Regulatory

Environmental and Regulatory supports the project with the regulatory process including:

1)       Regulatory application support

2)       Update the waste management plan

3)       Prepare a spill containment plan

4)       Noise survey

5)       Support to Community Consultation

6)       Emissions inventory and monitoring requirements

7)       Spill containment plan

8)       Environmental evaluation of winter construction and logistics

9)       Input and support to Operations and Maintenance

10)   Regulatory Compliance Plan

 

1.6          Construction Logistics

This section provides construction planning and logistic support including:  

1)       Modularization study (supported by Mechanical/Piping)

2)       Gravel placement methodology and cost (work with Civil)

3)       Advance emergency preparation/response plan

4)       Testing and pre-commissioning plan

5)       Construction Execution plan

6)       Construction/fabrication quality surveillance plan

7)       Lead Constructability reviews and prepare reports as part of model review

8)       Logistics scope definition

9)       Infrastructure support

10)   Geotechnical winter work program

11)   Construction Demobilization Plan

12)   Construction Plot Plan

13)   Plan for Communications During Construction 

 

1.7          Operations & Maintenance

This section provides the a plan for operations & Maintenance

2.    Time Component

 2.1              Introduction 

Every project has to have a start date and an end date as no project can be expected to continue indefinitely. Every project has some element of a time constraint and most major projects also have many well-defined milestones to be met. As an example a project may have the following contractual milestones:

1)       Completion date Basic Engineering

2)       Ordering of Major Equipment

3)       Substantial completion of detailed engineering

4)       Start of Construction work

5)       Mechanical Completion

6)       Project commissioning

7)       Handing over

While developing the project schedules, time required to complete each and every activity is estimated. Depending on the interrelations and dependencies, the time required to complete a task on the Work Breakdown Structure is estimated. Through the scheduling techniques, project activities are prioritized, critical paths are identified and the dependencies between activities are re-worked and the resource requirements are estimated.  The schedules are rolled up using the schedule networking techniques to arrive at the project milestones.

Schedule management is a critically important skill for any successful project manager. It is observed that the Project Managers who succeed in meeting their project schedule have a good chance of staying within their project budget. One of the common causes of budget over-runs is the lack of proper schedule management. 

2.2              Project Schedules 

Project schedule is simply a graphical illustration of a project’s execution plan.  It organizes the activities and tasks into a fixed time frame taking into account the inter-dependencies among each other. Each task and activity is allotted a completion time duration. The schedule represents the project plan and is vigorously monitored to ensure that work is being performed within the allotted time frame.

The project schedule is the core of the project plan and is used by the project manager to commit people to the project. Schedules are also used to communicate final deadlines and to determine the resource needs and serve as a checklist to make sure that every task necessary is performed. 

Project Schedule is an invaluable tool for organizing, evaluating, and forecasting how a project is to be executed and provides project team members with an understanding of the interrelationships between activities and serves as a vehicle for achieving buy-in from all of the team members. Each team member has a role and commitment for meeting the objective. Its greatest value is its ability to identify the Critical Path i.e. those tasks, activities, and duration that dictate the overall duration of the project. As problems arise, the schedule can be used to evaluate alternative paths for achieving success.  The schedule can provide guidance in identifying problems early in a project.  If, for instance, a project activity was scheduled for three months, and in the first month only twenty percent of the task was completed, the team can entertain methods to recover the lost time.

There are numerous methods and paths of achieving the project goals; the project schedule illustrates one such method for achieving the stated objective within the required time frame.  There could be many other execution plans that can result in a successful project but different plans result in changes in duration, cost and quality of the project.

 

3.    Cost Component

3.1              Introduction

Every project has to have a budget and it is one of the critical responsibilities of the project manager to ensure that the project cost remains within the pre-assigned budget and preferably remains under-run. Budget over-runs always reflect very poorly on the management team. This is where the cost control system comes to the rescue of project manager.

Project cost has a broader meaning and includes all of the resources that are required to complete the project. It includes the people, the machinery and equipment that do the work, the materials they use, and all of the other events and issues that have a monetary impact or need someone’s attention in the project. The project cost may have the following components which need to be monitored and controlled:

   

1)       Home-office man-hour cost

2)       Home-office overheads

3)       Bulk material costs

4)       Equipment costs

5)       Construction direct labor costs

6)       Construction material costs

7)       Contractor costs

8)       Indirect costs

9)       Other misc. costs

3.2              COST CONTROL

Project cost control is comparing actual and committed project cost against the control cost or the budget. It is refers to knowing exactly what is committed, what remains to be committed, what is incurred, invoiced, approved for payment, paid and analyzing the variance. This makes cost control very critical to the success of a project. No major project is initiated without first establishing an effective cost control system. When it comes to project management, cost control can make or break a project’s budget. Cost control can best be achieved by setting up a budget which is consistent with plans for actual spending. Another important aspect of cost control involves collecting the actual and committed cost and preparing and analyzing reports for the cost management.

 

COST CONTROL PROCESS

The approved budget estimate is categorized into the Cost Code of Accounts and loaded into the project cost system. This serves as the control budget. Actual costs are continuously recorded in the cost system from accounting transactions. Cost reports will be generated by cost code for the total project. By using this system, a budget versus actual expended comparison is made by account.

Deviations are identified and project management alerted so that timely corrective action may be taken.

The Cost Control Process involves the following steps:

1)       Budget Finalization

2)       Cost Control Tools

3)       Cost Coding & Loading

4)       Cost Capture

5)       Cost Schedule Relationship

6)       Change Management

7)       Data Evaluation

8)       Risk Analyses

9)       Forecasting

10)   Contingency Management

11)   Cash Flow

12)   Cost Reporting

These topics will be discussed in detail in other blogs.

4.    Quality Component

4.1              Introduction

Quality is a measure of fitness for use and represents meeting or exceeding the needs and expectations throughout the life-cycle of the project or what-ever is being delivered. The items being delivered may include the designs, drawings, equipment or the complete plant.

Quality is an important aspect of Project Management. Every major project has to have systems in place for proper quality management. Quality Management is the management of systems and procedures that determine the quality policies, objectives, and responsibilities so that project outputs are delivered fit-for-purpose. The purpose of a project Quality Management Plan is to define the overall quality philosophy for the Project, the organization and responsibilities for achieving the desired quality, and the general quality management activities to be performed.  It addresses the quality requirements for Engineering, Procurement, Construction, sub-contracts and related project management activities.

The quality requirements for a project apply to:

1)       Project Management

2)       Project Controls

3)       Engineering

4)       Procurement

5)       Project Administration

6)       Objectives

4.2              Quality Evaluation

From the project point of view, the quality is judged on the following criteria:

1)       Meeting the project schedule and targets

2)       Project completion within the Budget

3)       Meeting the product specifications

4)       Operational suitability

5)       Proper and accurate documentation

6)       Compliance with standards

7)       Acceptable maintenance costs

4.3               Quality Plan

 

All major projects have a Project Quality Management Plan, the purpose of this plan is to define the overall quality philosophy for the Project; the organization and responsibilities for achieving quality; and the general quality management activities to be performed by the project team. 

Quality Management Plan will be discussed in future blogs.

5.    Project Performance Component

 

Successful project managers control projects by carefully monitoring, measuring, and managing the project performance. Usually performance is measured in the fundamental areas of budget and schedule, but the performance of major projects includes areas like project’s scope, quality and owner satisfaction along with schedule and budget.

Performance Evaluation

Once the monitoring (also known as measuring) is done, it is essential to evaluate and analyze the data so collected. Given below are some of the areas of analyses:

 

1)       Progress evaluation

2)       Progress Performance Reports

3)       Monitoring the current status of project against the base line schedule

4)       Monitoring the current status of project against the base line cost estimates

5)       Establishment of Critical Path

6)       Forecasting project milestone completion targets

7)       Forecasting cost to complete each unit

8)       Estimation of progress performance

9)       Estimation of project productivity figures

10)   Identifying trends and change orders

11)   Identification of critical activities likely to impact the project

12)   Evaluation of schedule and cost risks

13)   Forecasting final project completion schedule and cost

Project Performance will be discussed in detail at a later stage.