INTRODUCTION
The Project Management must follow a
well-defined Process involving a number of stages. Important stages of Project
Management Process are presented in chart PM-04.
It consists of the following stages:
1)
FEED
(Front End Engineering & Design)
2)
Planning
3)
Development
(E & P)
4)
Construction
5)
Monitoring
& Reporting
6)
Evaluation
7) Close-Out
A more detailed view of the project execution process is presented in the
following figure.
1.
FEED
FEED, (Front End Engineering and Design) is the starting point for
every project and includes conceptual design and basic engineering for the
project. The Conceptual Design is a study phase in the life cycle of a
project where ideas are generated and alternatives are evaluated. This phase
results in development of a basic process concept, a preliminary schedule and a
rough cost estimate (ROM).
The conceptual design is followed by
Basic Engineering which is the elaboration of the conceptual design into a
package, defining the process requirements and the associated equipment and
project facilities. A cost preliminary estimate is also developed during this
phase.
As this stage determines the nature and
scope of development as well as the project cost estimate, it is very crucial
for the final success of any project. In case of shortcomings during this
phase, it is very unlikely that the project will be successful in meeting the
project goals, objectives and needs. At this stage all deficiencies in the
basic parameters are duly identified and rectified. This stage includes a
cohesive plan that encompasses the following areas:
1)
Conceptual
design for the operation of the project
2)
Clear
definition of project scope and objectives.
3)
Detailed
process description.
4)
Detailed
studies analyzing the business needs and goals.
5)
Major
and critical equipment and machinery requirement.
6)
Preliminary
cost estimate.
7)
Project
Master Schedule.
8)
Financial
analyses of the costs and benefits.
9)
Project
charter including costs, tasks, deliverables, and milestones.
10) Many a times, a small prototype of
the final product is built and tested. Testing is generally performed by a
combination of testers and end users.
A detailed discussion on FEED will be
available in forthcoming blogs.
2.
PLANNING
Planning is the next step in project management process. It is
said to be basic to all human activity and the application of common
sense. It involves working out the details of what is required to be done, when
it is to be done and how is it to be executed. In other words, planning
involves identifying needs and opportunities, working out various possible
courses of action, identifying the most appropriate actions, evaluating
feasibilities to achieve the plans, estimating the resources needed to
meet the objectives, anticipating possible road-blocks and fixing targets and
milestones for meeting the final objectives. Planning techniques are found
to address many organizational problems, opportunities and growth. Whether the
priority is an effective design, completion targets, cost optimization, or new
initiatives, good planning is bound to increase the chances of the success of a
project. It helps to analyze and assess present needs, future challenges and
assists in testing various alternatives. Good plans always allow for
flexibility to adapt changing circumstances. The basic need of project planning is to
increase the likelihood of a project being implemented efficiently, effectively
and successfully. A failure to
adequately plan meticulously reduces the project's chances of success.
In the case of project
execution, planning starts immediately after the development of preliminary Project Business Plan (PBP) and Project Execution Plan (PEP) and
continues simultaneously with the development of these documents. As planning
is very basic to any project control activity it is done well ahead of
most actions being executed.
The basic need of planning is to manage time,
cost and resources adequately to estimate the work and to effectively manage
risk during project execution. A failure to adequately plan meticulously
reduces the project's chances of success. A plan generally consists of:
1) Establishment of the Project Coding Structure. The
coding structure needs to be line with the Work Breakdown Structure (WBS).
2) Selection of
the team members
3) Establishment
of the level of detail required.
4) Development of major project milestones after
meticulous study and including adequate float.
5) A clear definition of scope and deliverables
6) Identification of activities and actions required
to complete the deliverables.
7) Development of interfaces for all deliverables
between the project team members within the boundaries of project milestones.
8) Networking
the activities in a logical sequence taking care of the interfaces.
9) Development of project schedules
10)
Estimating
the resource required for completion of the activities.
11)
Development of realistic cost estimates with
adequate contingency reserves.
12)
Meticulous detailing of the structure ensuring
single point accountability.
13)
Development of well-defined assumptions towards the
development of cost estimate.
14)
Establishment of Risk Management plans
A
detailed discussion on Planning will be available in forthcoming blogs.
3.
DEVELOPMENT
Development is the next step in the Project
Management Process. During this stage, the project gets developed.
This stage is also known EP Stage or the detailed engineering
and procurement stage.
A) Engineering
The detailed Engineering includes the following disciplines:
2) Piping
3) Mechanical
4) Electrical
5) Telecommunications
6) Automation/
Instrumentation
7) Civil
& Structural
A
detailed discussion on Engineering will be available in forthcoming blogs.
B)
Procurement
The Procurement includes the following:
1) Finalization of Purchase
Orders of Equipment
2) Finalization of Module
Fabrication & Assembly contracts
3) Issue of Purchase Orders for
Bulk Materials
4) Inspection and Expediting
A
detailed discussion on Procurement will be available in forthcoming blogs.
4. CONSTRUCTION
Construction refers
to the process of implementing the project as engineered and procured. It
consists of the processes used to complete the work defined in the project
execution plan (PEP).
A
detailed discussion on Construction will be available in forthcoming blogs.
5.
MONITORING & REPORTING
Monitoring
Monitoring
consists of those processes performed to observe project execution so that
potential problems can be identified in a timely manner and corrective
action taken, when necessary, to control the execution of the project. The
key benefit is that project performance is observed and measured regularly to
identify variances from the project management plan.
Monitoring
and Controlling includes:
1) Measuring the progress of project activities
2) Monitoring the project cost, manpower and schedule against the project execution plan and the project control base
3) Identification of correction and mitigation plans to address issues and corresponding risks and applying corrective measures.
Reporting
The purpose of the Progress Reporting and monitoring mechanism
is to enable the Project Team, the Project Owners and the Sponsors to
follow, monitor and keep informed about the developments on the project. It is
a key element of Project Management and projects a qualitative as well as
quantitative summary of the project and the actions taken to control the project. It
is an effective communication mechanism and is a key
to the success of every project. Listed below are some of the important reports
and monitoring documents generated:
1) Monthly
Progress Reports
2) Weekly
Progress Reports
3) Milestone
Charts
4) Schedule
Updates
5) Manpower
& Man-hour Charts
6) Needs List
7) Look Ahead
Schedules
8) Critical
Issues Reports
9) Schedule
Critical Activities
10) Change
Management Reports
11) Cost Control
Reports
12) Financial
Reports
13) Road Blocks
A
detailed discussion on Monitoring & Reporting will be available in
forthcoming blogs.
6.
EVALUATION
The next
step in the Project Management Process is the evaluation of all the work that
has been done. 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
Given below is a discussion on some of these
topics. A detailed discussion will follow in future blogs:
A) Progress Evaluation:
Project progress is a key factor in the
measurement of project performance, especially in the areas of schedule and
cost. It controls the measurement of engineering, procurement and construction
costs and schedules. An accurate measurement of progress serves as a basis for
the evaluation of performance against the project’s control base on schedule
and budget. Progress (percent complete) is measured by using a weighted average
method of computing "earned" values.
B) Earned Value
Earned Value technique is used as a way to
accurately measure and manage project performance to enhance project control.
It allows simultaneous measurement of budget and schedule conformance, and
captures their interrelationship better than most other methods. That is why
the Earned Value Technique has found a universal recognition on the evaluation
of performance on major projects. It measures the efficiency at which work is
performed pin-pointing the project problems at grass root levels.
The progress reporting system is set up
as soon as a reasonable breakdown of drawings, specifications and other
activities are available for various engineering disciplines. This occurs soon
after the availability of basic designs, execution approach and the initial
cost estimate. The Control Level Schedules provide a listing/grouping of all
deliverables (drawings, specifications, etc.) and activities required for the
completion of a project. The weighted value is determined for each item by
allocating the estimated hours to each line item based on the respective
discipline control budget. By determining the "percent complete" for
each item at the end of a reporting period, the earned hours are calculated as
follows:
P=E/H
Where
P= Progress
E= Earned Hours and
H= Estimated or Budget Hours
In other words, the total earned hours
from work completed divided by the total control (estimated or budget) hours
determines the physical progress for each item. A roll-up of all items and
disciplines results in the physical progress for the unit or the whole project.
C)
Home Office Performance
The home office performance is calculated
using the expended hours and is a measure of work accomplished versus actual
expenditures and is calculated on both an incremental and cumulative basis at
the end of each reporting period. Performance of greater than 1.0 represents
efficiency better than control budget and would result in under-run in home
office work hours. Whereas, a performance figure of less than 1.00 is an
indication of lower efficiency and would result in over-run in the work hours.
D) Construction Performance
Construction progress is calculated
using the "unitized progress reporting" system. Estimated work hours
are established in the control base for each defined "unit" to be
built or installed. Physical progress against each defined unit is measured and
input into the progress system.
7.
CLOSE-OUT
As the name refers, Project Close-out is done at the
completion of the project. A discussion under this includes:
1)
Why Close-Out
2)
Close out detail
3)
As-Built drawings and documents
4)
Final Cost Package
A
detailed discussion on Project Close-Out will be available in forthcoming
blogs.
