Pre-Project Planning
Lessons from the
Construction Industry Institute
Michael Davis, P. Eng, PMP
Ontario Power Generation
Objectives
Demonstrate the importance of pre-project
planning
Describe a pre-project planning process
Review some CII planning tools
Construction Industry
Institute
The Construction Industry Institute
Unique organizational model
– 90 to 100 corporate members
– Owners and contractors
Conducts research into best practices for
construction projects
– Research done by academics under guidance of
member project teams
Assists in moving the research into practice with
implementation tools
All information is available in the public domain:
www.construction-institute.org
What is a Best Practice?
A process or method that, when executed
effectively, leads to superior project
performance
CII Validated Best Practices
Pre-Project Planning
Alignment
Constructability
Design Effectiveness
Materials
Management
Team Building
Partnering
Planning for Startup
Quality Management
Change Management
Disputes Resolution
Zero Accidents
Techniques
Value of Best Practices:
Project Cost Performance
Project Budget Factor vs.
Practices Use Index
Cost Category: Greater than $5MM
N=73
N=74
N=71
By Practices Use Index
N=75
Value of best practices:
Project Schedule Performance
Project Schedule Growth vs.
Practices Use Index
Cost Category: Greater than $5MM
N=60
N=55
N=65
By Practices Use Index
N=57
“Best” Best Practices
Pre-project
planning
Change control
Planning for
startup
Impact of Best Practices
Average Project Cost : $79MM
Average Project Duration : 99Weeks
High
Impact
Design/Information
Technology
Schedule Reduction
Schedule Reductions
Pre-Project Planning
Planning for
Startup
Zero Accident Technique
Team Building
Medium
Impact
Cost Savings
Constructability
Materials
Management
Low
Impact
Low Impact
Medium Impact
Cost Savings
Project Change
Management
High Impact
Pre-Project Planning
Pre-Project Planning
That part of the project planning process
that takes place before the project is
authorized to proceed
Sometimes called “front-end loading”
An Owner responsibility
Expect to spend 10-25% of engineering
cost (up to 8% of total project cost)
Assign project manager and best staff
Have key stakeholders represented
Opportunity for Influence
Conceptual
Analysis
and R&D
Rapidly Decreasing
Influence
Influence
Low
Influence
Expenditures
Scope
Definition
Pre-Project
Planning
Basic
Production Construction Engineering
Project
Data and AuthorizationEngineering
Complete
Scoping
and
Procurement
Project Life Cycle
Project Expenditures
Level of Influence
Major
Influence
Turnover
and
Start-up
Pre-Project Planning
Provides a basis for:
Informed business
decisions – “doing the
right project”
Efficient project
delivery – “doing the
project right”
CII Pre-Project Planning
Process
Analyze
Technology
Select
Team
Draft
Charter
Prepare
Pre-Project
Planning
Plan
ORGANIZE
FOR
PRE-PROJECT
PLANNING
Evaluate
Site(s)
Prepare
Conceptual
Scopes and
Estimates
Evaluate
Alternatives
SELECT
PROJECT
ALTERNATIVE(S)
Analyze
Project
Risks
Document
Project Scope
and Design
Business
Case
Define Project
Execution
Approach
Establish
Project Control
Guidelines
Make
Compile Project
Definition
Package
Decision
DEVELOP A
PROJECT
DEFINITION
PACKAGE
DECIDE
WHETHER TO
PROCEED
WITH PROJECT
Key Elements
Organize for pre-project planning
– Create a team
– Draft the charter for the planning phase
– Plan the planning: tasks, deliverables, responsibilities, etc.
Select the alternative
–
–
–
–
–
Alternatives definition
Technology
Site/location
Conceptual scopes, estimates (-30 to +50%)
Evaluate the alternatives
Financial
High level risk analysis
Key Elements
Create project definition package
– Project objectives and priorities
– Scope and preliminary design
– Risk analysis
– Project delivery strategies
– Project Execution Plan
Prepare the business case
Submit package to approval authority
Decide whether to proceed or not
Project Objectives
Establish project success
criteria - define the target
Sets priorities consistent
with business drivers
Basis for decision making
Refined as project
progresses
Scope Definition - Estimating Accuracy
Expected Percent Variance
Excluding Contingency
Pre-Fund Authorization
Conceive
Post Fund Authorization
Develop
Execute
+100%
+15%
+5%
-10%
-2.5%
Most Probable Cost
-50%
Order of
Magnitude
Release
Definitive
(Detailed)
Elements of a
Project Execution Plan
Objectives & priorities
Scope and deliverables
Execution and delivery
strategies
Organization and
responsibilities
Cost estimate & budget
Schedule & milestones
Permitting
Safety, quality,
environment
Procurement
Communications
Project controls
Risk assessment and
management
Commissioning and startup
Closeout
Sponsor’s Role
Verify correctness of objectives, priorities and
scope
Review and concur with execution strategy
Verify assignment of roles & responsibilities
Concur with estimate and contingency
Concur with schedule milestones and
completion date
Verify acceptability of project controls and
change management process
Review and concur with risk management plan
Approve significant changes to the PEP
Planning Outcomes
Understanding of objectives & priorities
Optimum solution identified
Project scope defined - what’s in/out
Alignment of participants and stakeholders
Knowledge of risks
Credible estimate and schedule
Sound business case
Effective, achievable project plan
Pre-Project Planning Tools
PDRI
Project Definition Rating Index
Planning assessment tool developed by CII
through extensive research
Evaluates how well the scope definition and preproject planning has been carried out
Provides an early indication of the
probability of project success
Validated - tested against actual project results
Proven effective on both small and large projects
PDRI
70 elements are grouped into 3 categories:
– Basis of decision/scope (50%)
– Front-end definition/preliminary design (42%)
– Execution approach (8%)
Each element is given a weighted score
The more completely an element has been
addressed, the lower its score. (Similar to golf:
lower is better)
Maximum score of 1000
Score of <200 correlates with more successful
projects
PDRI Score sheet
Project Alignment
Common, clearly
understood set of
project objectives is in
place
All project team
members working
toward the same set
of objectives
Alignment Tool
Developed from workshops, surveys,
interviews
Involved more than 100 experienced
individuals at all levels
66 alignment issues analyzed for
correlation with project success over 20
projects  10 key factors identified
Factors Affecting Alignment
Stakeholders are appropriately represented on
the project team
Project leadership is defined, effective, and
accountable
The priority between cost, schedule, and
required project features is clear
Communication within the team and with
stakeholders is open and effective
Team meetings are timely and productive
Factors Affecting Alignment
The team culture fosters trust, honesty, and
shared values
The pre-project planning process includes
sufficient funding, schedule, and scope to meet
objectives
The reward and recognition system promotes
meeting project objectives
Teamwork and team building programs are
effective
Planning tools (e.g., checklists, simulations, and
work flow diagrams) are effectively used
Alignment Thermometer
Questionnaire
Alignment Thermometer
Other CII Resources
Team Building
Partnering
Change Management
Project Delivery and Contracting
Strategies
Zero Accident Techniques
Benefits of Pre-Project Planning
Fewer scope changes
Increased predictability of cost & schedule
Better definition of risks
Reduced probability of project failures
Improved operational performance
Better achievement of business goals
By the time a project is released,
the conditions for its success or
failure are essentially established.
Questions