The Knowledge Leader for Project Success Owners ■ Contractors • Academics Interface Management An Emerging Project Management Discipline Justin Goodman, Jacobs SangHyun Lee, University of Michigan Todd LaBar, Air Products 2014 Cll Annual Conference July 21-23 • Indianapolis, Indiana Research Team 302 - Interface Management Seungjun Ahn, U of Michigan (new Ph.D.) Alexandre Rocha Do Nascimento, Petrobras Paul Burroughs, Ontario Power Generation Marty Reibold, UPS Corp. Matt Cage, Alstom Power Samin Shokri, U of Waterloo (new Ph.D.) Justin Goodman, Jacobs Chris Smith, Architect of the Capitol Carl Haas, U of Waterloo Tim Swenk, McDermott International Jeff Hocke, Lauren Engineers & Constructors James Thorne, WorleyParsons Brian Johnson, Wood Group Mustang Paul Tompkins, Coreworx Inc. Todd LaBar**, Air Products Paul Van DerMerwe, Tenova Bateman SA SangHyun Lee, U of Michigan Lynn Neil Wheatcraft*, Dresser-Rand Debora Mello Ferreira, Petrobras Menzies Wilson, Smithsonian Institution * Chair ** Vice Chair Learning Objectives • Learning about Interface Management (IM) - What is Interface Management? - Why IM? - What level of IM is appropriate for a project or organization? • Understanding research findings Introducing available IM products and tools What is “Interface Management” •An idea? •An industry norm? A set of standards and practices? Have you heard of Interface Management or its practice? A. Yes B. No 0% 0% Does your knowledge of IM align with that of your clients, partners, contractors, and/or competitors? A. Yes B. No C. Not Sure 0% Does your company employ formal Interface Management practices and procedures? A. Yes B. No C. Not Sure 0% 0% 0% What is “Interface Management” “Interface Management is the management of communications, relationships, and deliverables among two or more interface stakeholders” CH Research Team 302, 2014 Types of Interfaces • Soft Interface: Exchange of information between delivery teams or between delivery team and external party or language and cultural aspects. Interface Point at Flanged Joint Interface Stakeholder B Interface Stakeholder A Hard Interface: Physical relationship between two or more components or systems. Interface Management Hierarchy Owner Contract Scope Insurance Certs FEED Doc Reporting MOMs, Daily Reports, Transmittals Payment Contractor Battery Limit Utility Tie-Ins Physical Boundary Location Data Network of Interface Stakeholders interface Stakeholders Interface Points (IPs) 21 IPs 5 IPs 32 IPs 10 IPs 18 IPs 12 IPs 10 IPs 13 IPs 8 IPs Thickness of edges is associated with number of IPs between interface stakeholders. What is “Interface Management” “Interface Management is the management of communications, relationships, and deliverables among two or more interface stakeholders” CH Research Team 302, 2014 Why Interface Management? “What has happened in the industry to necessitate IM?” Why IM? • Dimensions of Complexity Level of Complexity - Geographic spread of execution centers - Level of advanced technologies - Numbers of stakeholders or project participants Medium - Project delivery methods - Fast-tracked projects • Risk Management - Each interface represents a potential risk Low Do your projects mostly involve a simple relationship between two parties, OR multiple parties with varying levels of interest/impact on project outcome? o% A. Simple B. Not Simple A. 0% B. Do you expect level of complexity on your projects to increase or decrease over next 10 years? A. Increase B. Decrease C. Stay the Same 0% 0% A, B, 0% Less or Least Complex - Project Team Co-located A Little More Complex - Same Team, Different Offices Three Interface Stakeholders Three Communication Channels : Fragmented information communicated via telecommunication (phone, email, etc.) More Complex - Add One More Stakeholder Four Interface Stakeholders Six Communication Channels Even More Complex - Add Two More Stakeholders Six Interface Stakeholders 15 Communication Channels, Multiple Interface Points per Channel What If...? Structural Engineer Owner Electrical Engineer - Lead Engineer Mechanical Engineer 15 Communication Channels Increasing Complexity Due to Compressed Schedule FEP Desig Construction Linear Project Schedule Commissioningr & Startup (C&S) Operation FEP Desi Construction C&S Compressed Project Schedule Operation Have multiple locations, languages, or cultural differences affected complexity of your projects? 0% A. Yes B. No A. B. On average, how many execution locations are involved in your projects? A. Less than 5 B. 5 - 1 0 C. More than 10 0% 0% 0% Darlington Nuclear Generating Station four-units / n e t o u t p u t o f 3,512 megawatts ( M W J Ontario Hydro - Owner (Toronto) Ontario Hydro (Construction) Atomic Energy of Canada - Reactor Design (Mississauga) Ontario Hydro - Design/Engineering Management (Toronto) ABB - Turbine/Generator Supply (Scarborough) Globally Dispersed Project Execution l 90’N -NPC -60 Engineering (ingenierie) p* -30 ’ N Module Fabrication -NT 5 si) Engineering -is*s -ST -30 Fabrication (fabricagao) -45*$ ■60*5 SPC ■ H * I1 1JLJIHooted information communicated via telecommunication (phone, email, etc.) 18<V% 150°W 120°W 9 0 °W 60°W 30°W 0° 30°E 60 &E 90 *E 120°E 150°E 180°E What complexity factor most warrants FORMAL IM practices? A. Multiple geographic locations B. New or advanced technologies C. Multiple owners, contractors, and/or sub-contractors D. New geographic location E. Fast track schedule 0% o% A, B, o% o% D. Which of these is the best means to communicate critical interface information with another stakeholder? A. Fax B. Phone call C. Meeting where both took notes o% o% o% o% o% D. Email exchange A. E. Written agreement in standard form B. C. D. E. Complexity Curve Urr nwcwcy i_ cotAfuexrri Formal Interface Management • Interface Management Personnel • IM Procedures & Practices • Standardized Interface Agreement Forms • IM Specific Software IM - An Emerging Project Management Discipline Project Management: 1950s Project Controls: 1960s Quality Management: 1970s Risk Management: 1980s IM: 2000s Research Methodology Literature W Focus Review ■ J Group Questionnaire P i Pilot P i Structured P i Data P i Tools & Development M Survey M Interview M Analysis M Guide • Literature Review - Previous CH reports, Interface Management in construction & other disciplines. • Structured Interview (facilitated with Survey Questionnaire) - Use of face-to-face or phone interviews - Total 46 Projects (representing over $150 Billion in CAPEX) □ Informal IM N> —L IM Formality and Project Size ■ Formal I M co —L o ro # of Projects o 10 <$500M $500-$1B S1B-$5B $5B-$10B >$10B Project Dollar Value Formal IM more prevalent in projects of higher $ value IM Formality and Project Delivery Strategy U1 18 O1 -*■ O 10 O # of Projects to O to U1 □ Informal IM ■ Formal IM DBB DB EPCM EPC Others Project Delivery Strategies EPC & EPCM most common delivery strategies with Formal IM IM Formality among Interface Stakeholders □ Informal IM ■ Formal IM 14 10 1-5 5-15 >15 # of Interface Stakeholders IM is more prevalent on projects with more stakeholders Project Characteristics Correlation w i t h I M Implementation Project Size # Interface Stakeholders (0.33) # JVs/Owners (0.24) <<Locations k(0.14) Ml Correlation (0.56) IM Implementation vs. Project Phase Sequential Project Phasing 12% Feasibility Concept Detailed Scope 88% Feasibility Concept Detailed Scope Design Commissioning & Start-up Construction Operation Design Construction Commissioning & Start-up Operation Parallel Project Phasing Start IM at Concept and Detailed Scope Phase IM Implementation vs. Project Cost Growth 2.00 Formal IM Projects Had Lower Mean of Cost Growth & Less Standard Deviation 1 50 Cost Growth p=0.25 1 00 16 4 50 oo -.50 Mean: 0.18 Standard Deviation: 0.38 Mean: 0.04 Standard Deviation: 0.16 Informal IM (n=27) Formal IM <n=10) Globally Dispersed Project Execution L 9 0 ,JN -75 *N -NPC -60 *N -45 *N Ingenierie -30 *N -NT (Engineering) Construction Site (Module Fabrication -o* 3rfJNifa|<£l (Engineering) Fabrica?ao (Fabrication) - -15 * S J. -ST -30*3 -45*3 -60*3 -SPC -75 *3 1 5 0 °W 1 2 0 °W 90 6 0 °W 3 0 °W 0 30 60*E 9 0° E 120°E 150 °E '90*3 180 *E Formal Interface Management • Interface Management Personnel • IM Procedures & Practices • Standardized Interface Agreement Forms • IM Specific Software Tools Developed b y RT 302 • Interface Management Implementation Guide (IMIGe) - Project Interface Risk-Impact (PIRI) Matrix - Interface Complexity Assessment Tool (ICAT) - IM Maturity Tool - IM Implementation Roadmap LOW FORMAL IM interface Manager IM SpreadSheel □ I M Commercial Software Integrate wr Schedule 1 integrate w, Change Mgrrt Integrate wr Rtsk Mgnl INFORMAL IM MEDIUM •O •• •• nlerfarft M g i LOW Interface Manger IM Spreadsheet IM Commercial Software Integrate w/ Change Mgmt Integrate w Risk Mgmt LOW 1 FORMAL IM IM S p i endsheel ■w spreadsheet W Ccimrwo# Sottwfirrj nlegiate w Stfiedute Inteyriite w' SctedJa ■grate w' Change Mqn'l Inteqiale w- Charge kVnfl teqrate w ’Risk Moml Integrate w ' Risk Mgmt interlace hfard integrate Interface Manager Set Integrate w.‘ Chant IM Spreadsheet Integrate w Risk interface Mr IM Commercial Software I M Spreads!! 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SC/ Integrate •3 MOST FORMAL I M IM s p n a t m IM Ccmmeicial S MORE FOR * > o Integrate w/ Change Mgmt Chant Integrate w 1 Risk Integrate w/ Risk Mgmt INFORMAL IM 0 IM Spreadsheel » Commercial Software 0 rtegrate uw SciteAfe 0 flrataw.'CMmosMortit 0 teyttee w- Risk Msjrtl 0 O U Speadsheei » H Gonimercjai Software O integrate w,' Schetttie O Ntgrafa wi chanoeMann & LOW MEDIUM Interface Manger Integrate w/ Schedule • o W Commercial Software • Integrate wf ScbecMe • Inlegrale w> Charge Mtrrfl • Integrate w Risk Mgmt • At SpttadBhrW* Interface M g i HIGH MOST FOfd literfacc Mnnagci Gomnwraal Scflwant LEAST FORMAL IM HlGh MORE FORMAL IM Interface Manager Heonte w/ Risk Munn interlace Manager » O Megrare w sofieduie • integrate w Change Mgmt • kileurttie w Risk Mgrri • IM Spreadsheel IM n fjnmarcial Software HIGH PROJECT / BUSINESS IMPACT • (2 • • • • HIGH 3MPLEXITY RISK PIRI Matrix ICAT* * Interactive Spreadsheet Supporting Question for Interface Influencing Factor Interface Weighting Rating Score 1 Have these organizations interfaced before? 10% 0 0.00 2 How many of the individuals involved have interfaced before? 5% 1 0.05 3 Are both organizations comfortable with the communication language? 5% 1 0.05 4 Do individuals have different cultural backgrounds? 5% 2 0.10 5 How many hours difference in geographical time zones between locations? 4% 2 0.08 Interface Management Implementation Guide (IMIGe) Table of Contents Chapter 1 ; Executive Summary 3 Chapter 2 : Introduction 4 Chapter3 : What Is Interface Management? 9 Chapter 4 How Do You Determine the Appropriate Level of IM Implementation for Your Project and/or Organization? _ ________ _______ _ _____ _ _15 Chapter 5 : What Are the Requirements for Each Maturity and Implementation Level? 25 Chapter 6 : How Do We Implement IM? Chapter? : Concluding Remarks.. 34 . . .42 Chapters : References 43 Chapters : Appendices .....45 IMIGe Interlace Slafr*- Interlat* Pnml ’effect Wtrfacp Apee rt 'IAi Interlace Adtefi Item |IAI},„ ■' iTHfaceCoiiro Dxumert'ikaRing Irsertett twfact Ajfwment (IAi Inter'Kfi Ag-eemeifii*1 Summary of Tools Developed by RT 302 * Interface Management Implementation Guide (IMIGe) - Project Interface Risk-Impact (PIRI) Matrix - Interface Complexity Assessment Tool (ICAT) - IM Maturity Tool - IM Implementation Roadmap Learning Objectives • Learning about Interface Management (IM) - What is Interface Management? - Why IM? - What level of IM is appropriate for a project or organization? • Understanding research findings Introducing available IM products and tools What’s in It for Me? • Industry established and recognized common language • Clearer understanding of level of IM required • Better IM likely relates to better project cost performance • Earlier recognition of risks to facilitate mitigation • Effective products and tools for immediate use Wrapping Up • RT 302’s exciting research on IM is only “the beginning” • More complex projects require more formal IM • Cost growth likely improves with formal IM • All of our tools are now available from CH as your guide to IM National Museum of African American History and Culture Panel Discussion Panel Experts for Audience Q&A • Carl Haas - University of Waterloo • Todd LaBar - Air Products (RT 302 Vice Chair) • SangHyun Lee - University of Michigan • Lynn Wheatcraft - Dresser-Rand (RT 302 Chair) • Menzies Wilson - Smithsonian Institution