Strategies to Overcome
Shortages of Crafts and
Maximize Field Productivity
Bobby Singh
President
Project Assurance, Houston, Texas
Strategies to Overcome Craft Shortages
Presentation Focus
 Industry’s Challenge to Overcome Craft Shortages
 Recent Turnaround Experiences
 Some of Our Management Weaknesses
 Solutions to Overcome Craft Shortages
 Improving Craft Productivity
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
10
Contractor Alignment and Team Building Sessions
are conducted after the turnaround completion.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
9
Turnaround scheduling staff are frustrated due to
the planning software’s limitation to schedule
only 1,000,000 activities.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
8
Reengineering is considered to be as-built drawings
after operations and process engineering groups
have made 10,000 MINOR scope improvements.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
7
Expedited and long-lead materials are found under
contractors’ trailers after the turnaround
completion.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
6
Sole criteria for selecting qualified contractors is the
number of their memberships to golf clubs, burlesque
bars and invitations to hunting and fishing trips.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
5
Planning, Cost, Inspection and Safety staff are
laid off to save turnaround costs and
improve company profits.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
4
WBS, PSM and HAZOP are perceived as the new Cable
TV Channels on the information super-highway.
Achieving World-Class Turnarounds
TOP TEN LIST
3
When a Company is NOT Managing
World-Class Projects and Turnarounds
Company’s turnaround vision, executive mission
statement and performance goals are written by
professional speech writers.
Achieving World-Class Turnarounds
TOP TEN LIST
When a Company is NOT Managing
World-Class Projects and Turnarounds
2
Progress status, schedule updates and cost
forecasts are performed by local psychics,
astrologers and tarot card readers.
Achieving World-Class Turnarounds
TOP TEN LIST
1
When a Company is NOT Managing
World-Class Projects and Turnarounds
When a Manager says, “I have not read Bobby
Singh’s latest book
World-Class Turnaround Management.”
Strategies to Overcome Craft Shortages
Industry Challenge
Cost and schedule performance of most Capital Projects and
Plant Turnarounds is being severely impacted by :
1. Shortages of qualified crafts
2. Experienced supervision
Strategies to Overcome Craft Shortages
Industry Challenge
Poor performance on capital projects and
turnarounds is further compounded by:
1. Poor field productivity
2. Low actual tool time
3. New regulatory requirements
4. Integration with large capital projects
Strategies to Overcome Craft Shortages
Productivity – Tool Time
On a typical construction the actual tool
time on a 10-hour work shift
Is less than 4 hours
Not an Encouraging Productivity Statistics
Strategies to Overcome Craft Shortages
How many of you folks have their Projects
and Turnarounds results adversely
impacted by
Craft shortages and poor productivity?
Strategies to Overcome Craft Shortages
Past Performance Results
Some of Canada’s large tar sand projects have
experienced cost overruns of
over Billion Dollars
due to craft shortages and poor field productivity.
Strategies to Overcome Craft Shortages
Past Performance Results
Ethylene Turnaround in Houston Area
Planned crafts during turnaround:
2000
Actual maximum number of crafts
1200
* Turnaround scheduling started 24 months before the turnaround
** 2 large mechanical contractors were selected for execution
Strategies to Overcome Craft Shortages
Past Performance Results
Large Turnaround in Lake Charles
Planned welders / pipe fitters crafts
Actual welders provided by contractor
124
31
* Other mechanical contractor was added to supplement primary contractors
** Contractors started planning 18 months before the turnaround
Strategies to Overcome Craft Shortages
Past Performance Results
Ethylene Turnaround in Lake Charles
Planned welders / pipe fitters crafts
112
Actual crafts provided by contractor
115
* Multiple contractors were selected to execute turnaround work scope
** Craft requirements and contracting strategy were developed 18 months
before the turnaround
Strategies to Overcome Craft Shortages
Overcoming Craft Shortage Challenge
During some recent large turnarounds and capital projects, the
problems resulting from shortage of qualified crafts and poor
productivity was so bad, that to help finish the work, the
companies had to rely on:
Highly Experienced, Motivated
and Productive Crafts !!!
Strategies to Overcome Craft Shortages
Contracted Foreign Crafts from:
Philippines
India
Croatia
Strategies to Overcome Craft Shortages
Welcome to the new realities of
executing plant Projects and
Turnarounds in the
21st Century
Foreign Pools of Contracted Labor
Strategies to Overcome Craft Shortages
Turnaround Management Benchmarking
Key Performance Areas
Leaders =
Industry Average =
%
100
Laggards =
80
60
40
20
Strategic
Planning
Work Scope
Management
Contracting
Strategy
Manpower
Planning
Productivity
Improvement
Strategies to Overcome Craft Shortages
We Must Accept Our Weaknesses
 Owners’ planning resources and expertise are limited
and shrinking
 Most companies do not perform front-end planning
to identify craft needs and develop craft procurement
strategies
 Companies spend most efforts reacting and fighting
fires than up-front strategic planning
Strategies to Overcome Craft Shortages
We Must Accept Our Weaknesses
 Manpower plans and solutions are developed without
participation of contractors and consultants
 We hope and sometimes pray for highest results
without mitigating the potential problems and
implementing innovative approaches
 Past poor results have been tolerated without any
consequences
Strategies to Overcome Craft Shortages
We have met the enemy
and the
enemy is us.
Strategies to Overcome Craft Shortages
Steps Towards the Ultimate Solution
 Start the planning early – 18 to 30 months before
the turnaround
 Start integrated planning with capital projects 2436 months before turnaround date
 Strategic Planning – Recognize the challenges
early and identify innovative solutions
Strategies to Overcome Craft Shortages
Steps Towards the Ultimate Solution
 Identify 80% + Turnaround Work Scope 15-18 months before
the turnaround date
 Identify preliminary craft requirements 15-18 months before
the turnaround
 Develop contracting strategies that reflect new market
conditions – select contractors 12-15 months before the
turnaround
Strategies to Overcome Craft Shortages
Smart Solutions
 Select multiple high performance contractors
 Do not overstretch contractors beyond their core
strengths and capabilities
 Develop contractor contingency planning to quickly act
in case primary contractors could not perform
 Jointly develop craft procurement plans
Strategies to Overcome Craft Shortages
Smart Solutions
 Select specialty contractors for complex work
 Utilize fixed-fee and incentive contracting to create
win-win and high-performance work environment
 Implement Productivity Improvement Plan in
consultation with contractors and consultants
Strategies to Overcome Craft Shortages
Emerging New Trends
 More emphasis on pre-fabrication
 Modularization construction
 Contractor alliances tied to performance baseline
 Splitting the turnaround into smaller and
manageable work scope
 Reliance on contracted pools of foreign labor
Strategies to Overcome Craft Shortages
Productivity Improvement Ideas
 Implement Productivity Improvement Plans
 Establish realistic budgets
 Programs to seek only qualified crafts
 Efficient work / safety permits systems
 No smoking projects and turnarounds
 Enforce discipline during breaks and quitting time
Strategies to Overcome Craft Shortages
Productivity Improvement Ideas
 Extensive planning and true look-ahead schedules for
next 2-4 shifts
 Minimize changes to execution plans
 Have efficient safety meetings
 Eliminate wait time due to materials and equipment
delays
Strategies to Overcome Craft Shortages
Conclusion
Sadly, there is no Magic Wand to overcome this problem.
Ultimate solutions is to take several small but smart steps:
1. Set higher expectations
2. Start craft planning early
3. Seek qualified staff and contractors
4. Synergistic and efficient work environment
Strategies to Overcome Craft Shortages
Conclusion
If all the above does not work, then call:
Project Assurance.
Questions and Answers Session !