Building a Solid Project Plan Presented by George Baskin, PhD About Me George Baskin • • • • Over 30 years of Experience Burns & McDonnell since 1999 Principal, Project Development PhD, Engineering Science – Mechanical Engineering – Industrial Engineering • St. Louis, MO • Personal Life – Wife & 4 kids – Church musician Topics • Setting the Stage – The life of a project • Project Planning & Definition – How are we going to do this? – How fast can we do this? – How much does it cost? • You Need a Well Oiled Machine – Developing & keeping team alignment Project Lifecycle Phases Stages & Gates • Business Planning Phase * – Identify a business need and plan how to satisfy. • Front End Planning Phase * – CAPEX allocation ready plan for project execution. • Project Execution Phase – Execute project design, procurement and installation. • Operation Phase – Start-up through decommissioning, dismantling, or other disposal. Business Planning Phase Identify and Define the Business Case • • • • • • • • What will be the product? How are we going to produce the product? How much product will we produce? What is the product market value? What is our anticipated revenue stream? What are our CAPEX and OPEX goals? Can we make a profit? Does this appear to be a viable business venture? Front End Planning Phase Validate or Disprove the Business Case • What will be our anticipated OPEX? – Staffing plan – Materials sourcing plan - Rolling stock plan - Maintenance plan • What will be our required CAPEX? – Facilities – Process control - Plant equipment - Project bulks • Is the project plan CAPEX allocation ready? • Is the Business Case still valid? 0 Feasibility 1 Concept 2 Detailed Scope Initiate Phase Initiate Phase Initiate Phase Generate Options Analyze Alternatives Preliminary Design/Eng. Preliminary Reviews Filter Options Conceptual Scopes and Estimates Evaluate and Select Best Alternatives Finalize Scope Definition PDRI 1 Feasibility Report Concept Phase Report PDRI 2 PDRI 2i Cost & Schedule Control Estimates PDRI 3 Project Definition Package 3 Design & Construct Pre-Project Planning Stages • Stage 1 Purpose – Evaluate Feasibility – Initial validation of the Business Model • Stage 1 Package – Conceptual Scope Definition – +50/-30% Capital Cost Estimate – Gate review to align the project team on deficient project definition areas that need to be addressed during the next stage. Pre-Project Planning Stages • Stage 2 Purpose – Evaluate and select technology alternatives • Intermediate gate may be used to help select “the” alternative to develop to final stage 2 level. • Stage 2 Package – Preliminary Scope Definition – +/-25% Capital Cost Estimate – Gate review to align the project team on deficient project definition areas to be addressed during the next stage. Pre-Project Planning Stages • Stage 3 Purpose – Fully define project scope – Allocate personnel, resources and capital required to execute the project • Stage 3 Package – Detailed Scope Definition – +/-10% Capital Cost Estimate – Gate review to identify deficient project definition areas that must be addressed before the conclusion of stage 3 and CAPEX allocation. Why Bother? • • • • • Improved predictability Safe construction and operation On schedule On budget, maybe even under Successful startup and operation • May reduce the project total lifecycle cost by as much as 25% to 30%. A Well-Oiled Machine So, how do we get our team aligned and keep it aligned? Alignment is achieved when the project team is working toward common objectives. Alignment Alignment is based on well-developed and well-understood, common objectives. Alignment is… • Important for any project in any company • Reduces miscommunication • Builds and maintains team motivation • Promotes cost efficient application of resources and capital Especially critical for newer organizations with a developing corporate identity and minimal legacy. Barriers to Alignment • Conflicting Values and Goals – Different team members bring the values, attitudes and goals characteristic of their origin. • Project Complexity – Complexity can obscure objectives and raise the risk of selecting an inappropriate objective. • Conflicting Objectives – Develop balance of objectives that reflects the owner’s interests and is acceptable to team. • Conflicting Guidance – Project team members may be influenced by stakeholder / managers from their functional group who provide guidance in support of goals that conflict with the project objectives. Changing Project Drivers • Projects seldom evolve throughout their development without surprises that require revisiting the balance of objectives relating to cost, schedule, quality and safety Setting Objectives • Formation – Owner resp. – Business goals and limitations • Communication – Written objectives to the team • Integration – Negotiation • Agreement Set Objectives Early • Project objectives should be formed early. • Influence on cost and schedule fades rapidly as the project matures and details become more rigidly defined and resources committed. What Are the Drivers? • • • • Business/Financial (image, fundraising, burn rate) Marketing (turndown, quality, $/unit) R&D/QA (purity/quality, process control & flexibility) Technology (established, serial #1) – Identify IP “crown jewels” that need protection – Develop a project IP protection plan • Capital Projects (design rate & CAPEX) • Operations & Maintenance (safety, up-time & OPEX) Rank the drivers honestly! Objective Agreement Test • • • • • • • • Is it specific and identifiable? Is it oriented toward single-ended results? Is it set against a deadline? Is it attainable? Is it responsive to organizational needs? Is it controllable? Is it assignable to responsible parties? Will it be used to evaluate the success of the project? Thank you! Questions?