Project Fantasy v Reality Check

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There’s a common fantasy in Project Teams that ‘the worst is behind us’ coupled with ‘the future is bright’.

Nothing wrong with a spot of optimism but on projects the past really does predict the future.

If you get off to a bad start it’s difficult to turn that around. The genesis of your problems will cast a long shadow onto future events. Small problems loom large.

The scenario can go like this. The project is rocky. A few senior people take the fall and are replaced. Corporate oversight is increased. More effort is applied. Progress is tracked more closely. But if the root causes of the chaos (it’s rarely only one root cause) are not examined, discussed and fixed then the chaos will continue.

If (say) project funding is a problem then changes to the project team will only increase the chaos.

 

Sources of Chaos

Let’s look at some of sources of chaos and see how they affect projects. I’ve went through every one of these and came out covered in scar tissue btw.

To start – ‘projects are temporary organisations established to manage an established outcome whose scope, duration and budget are rationally derived’.

The temporary aspect generates serious issues. The scramble to kick off a project has to be seen to be believed.

1: Location Location Location

A) I was once part of a world-class bid that failed because the proposed location for the project office was driven by a corporate need to fill an empty building under lease, not because it made project sense. The potential client was not amused. But, if we’d won the job then the hapless Project Manager would have struggled to get people to work on the ‘wrong-side’ of the city. Which is why the property was unoccupied in the first place.

B) I started a project where there was no office available for us or the client. The only suitable office was occupied by another project. Appealing to Corporate I was told to ‘fight the incumbent PM and take the space’. When I went to see ‘my director’ to say that my appeals had went unnoticed he said, ‘no Jim, I mean you will actually have to physically fight him’. I couldn’t box eggs – so it wasn’t a feasible scenario.

C) I had a project where my team, the client and the site were in 3 different countries. The outcome hardly needs to be aired in public.

Two: Project Funding

A) Projects are often under-funded. The mechanism may be that the project outcome cost was kept low to get through the funding committee. The PM has to live with that one.

B) The decision on the draw-down of funds is held by someone not on the project. They can save their company money by slowing funds to a trickle. “PMs are such needy people anyway, always overstating the case”.

Three: Project Personnel

Often projects are loaded up at the start with sub-optimal people because…

a) other projects are trying to shed them

b) they’re on the shelf in Corporateland (because they’re not wanted on projects)

c) it’s all that the resourcing guys could find at short notice (there is no other kind of resourcing notice)

Four: Readiness to Launch

Chaotic precursors (at various stages)

A) No/Slow-start because the basic elements of a project are not in place.

B) Permissions to start work not complete. Clients often urge a quick start before the paperwork is completed.

C) Changes to scope. Usually from 2 sources. The changes held back because the bid process was ongoing and changes emanating from the incomplete design (eg concept)

Five: Others Worth a Mention

  • Purchasing started before the design is complete
  • Client’s team nowhere in sight
  • Client offloads all his scrap onto your project

Six…. well you get the message. The genesis of chaos is right a the start of every project, often well before the project is sanctioned

The Bad News.

There is no way to avoid these problems. No way in hell.

 

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Project People – Ask Yourself This. Why This Company?

What Am I Working Here?

When I worked for a global engineering company I had to gather my project team and give a presentation on ‘Why This Company?’ Basically why did people want to work there and would people want to go and work there?

I thought about it for a while. We were working in Iraq out of the UAE and it’s not the environment for some of the more ‘Western reasons’. Which tend to be rather intangible.

 

Like

  • It’s an inspirational company
  • I will further my career
  • Looks great on the cv

and so on..

Good reasons but my guys were the more ‘down to earth’ types.

So I made some slides and gave the following reasons.

  1. You get paid
  2. You get paid on time as per your contract
  3. You get all the benefits stated in your contract
  4. The company does not discriminate in any way on race, religion, nationality, gender, age
  5. It has rules
  6. All management follow the rules
  7. You cannot be fired on a whim
  8. There are consequences for behaviour contrary to the company’s ethos
  9. There is grievance procedure for all
  10. The company is well funded

….I could go on but these were the main points, although it must be said that companies with the above attributes have a great commitment to HSSE.

Many of you may wonder why these were listed, but if you do? You haven’t worked for some of the companies my guys had been in. Many companies in the Philippines, India, Pakistan and the Middle East have none of the above reasons to work for them. Not one.

So if you’re sitting in a company go through those 10 points. If you can ring all those bells? Be happy. You know ‘why this company’.

 

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Business Development in a War Zone – the 3 Rules

No BD meeting should start out like this

“The way to make money is to buy when blood is running in the streets”. So said John D. Rockefeller who was at the time the richest man the world had ever known.

That’s a war-zone he’s talking about.

But working in a war-zone (Iraq) I watched people come and go trying to turn a buck. And I learned these 3 rules.

 

 

 

1. Do not go to the war-zone. There is no money there for you.

2. Find out how much your government is spending on the war-ravaged country and on what.

3. Lobby your government to spend some of the money on your company.

 

Let’s take an example. Say your company prints school books and your government wants to give schoolbooks to the educational establishment of a war ravaged country. The money for the schoolbooks will be spent in the donor country, not in the war ravaged country. Same for shipping, insurance, storage and so on.

Apart from anything else, nobody in a war zone has the time, the energy, the money or the capability to do anything else but run for cover.

And. The government of a war-ravaged country sucks in money, it doesn’t give any out. If you turn up at their door the assumption is that you’re there to give them something for free.

 

No place for businessmen

 

Returning to John D. Rockefeller’s quote – it doesn’t say you have to be in the street where the blood is running to make the money.

 

 

 

 

However if you feel you really should go to the war-zone, here are a few tips.

Get serious about security. Do not accept offers of security from local entities. ‘Don’t worry, we’ll take care of you’ and ‘It’s not really dangerous here’ are two things you’ll hear – a lot.

Take a substantial amount of wet-wipes with you. The biggest ones you can find. If there’s no water you can still get clean and toilet facilities may be rudimentary.

Take a plug for the shower/ bath/ basin (if you’re lucky enough to find one with running water).

Take a pack of Brufen 800 and a jar of Vick. Vick is a powerful antiseptic and not just for colds.

Wear shoes you can run in.

Wear the cheapest watch you own.

Check your life insurance. It will probably exclude war-zones (and that’s telling you something).

Plan your trip to the smallest detail and do not vary from that plan, ever.

 

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Project Disaster? Just Add Politics

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Not Stopping at Your Station Anytime Soon

In England there is great debate about building a high-speed railway link between 2 cities. Birmingham to London. The distance is about 200 kilometres, give or take how far a horse could spit. It’s called the HS2 Project. And it’s beset by politics.

If I was inclined to write a book called ‘How to Totally Banjax a Project’ I could describe this one and put it between 2 hardcovers with no comments added.

And it’s not started yet.

As a primer – have a butcher’s hook at this.  That’s the 2014 numbers at £50.1 billion ($65.8 billion in real money) and incredibly is a P95 estimate. That means there should only be a 5% probability of exceeding the total. It’s the first time I’ve seen a P95 used in my entire working life. It’s a worthless measure.

In 2018 the estimate is now £65 billion with a Cabinet and Treasury Department claiming it should be £80 billion. So far so normal for politically motivated projects. But it’s what the agency also said about the project that caught my eye.

Quote 1 “The report (classified as “official-sensitive” and “not for publication”) attacks HS2 management for “lack of cohesion and common vision” and says the executive team has “no credible plan by which to gauge or manage progress”. It notes “destabilising” turnover of senior staff despite paying some of the “highest public-sector salaries in the UK”.

Quote 2 “highly likely to significantly overspend by circa 20-60% with the likely cost increasing . . . to more than £80bn”.

I wont go into the schedule except to say whoever produced it should have their crayons confiscated immediately!

Remember that the contractor who wins this project will be the one with the lowest price and the shortest schedule, and a great curse will fall over them.

Politics – the biggest killer of projects known to man.

 

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How To Goose Your Financier

Says a guy to me in the pub. ‘I’m on a fast track project, mate. Mental. A million miles an hour. Great fun.’

Funny enough, a Fast Track Project is the exact opposite of that. A Fast Track Project is dull, slow, sane and no fun at all. The kind of project a financier loves to fund.

Very few people are on the Fast Track. What they’re on is a project in a hurry. A project with an unachievable end-date. A project that has no chance of success. A project that is going to spend waaay over it’s budget. It can be fun for the participants but not for the money men. The financiers? They’re goosed.

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What’s the Differences Between Fast Track and ‘In a Hurry’?

1. A Fast Track Project has a reason for it’s truncated schedule. And the reason is not ‘we’re late already’.

2. A Fast Track Project is defined by its use of scientific and measurable processes to truncate the schedule. (examples: modularisation, dimensional control, new technology)

3. A Fast Track Project has the processes embedded at the Concept stage

4. Each process used to truncate the schedule is visible and demonstrates the reduction in schedule

5. Each process used has a Duration v Cost analysis. Fast Track Projects are not Low Cost Projects. Fast Tracking costs money.

6. The Fast Track Methodology has the full and unalloyed backing of the project sponsors. Fast Track Projects often fall over when the main contract is awarded and that contractor ‘knows better’.

Example: Modularisation. For projects where the location demands a fast construction duration (offshore, war zone, inhospitable climate) then modularisation is a winner. But it has its own added cost due to extra design and steelwork for the module, transportation and lifting costs. Its big advantage is that it can be constructed in parallel to the main ground works on site. Work can start before people are mobilised to site. The other advantage is that the process work done in a yard is cheaper and safer and of better quality.

The time saved is the overlap of yard and site construction starts + less work on site. A modularised site is Hook-Up, a non-modularised site is Construction. There should be a significant reduction in Safety Incidents on a Hook-Up site.

The saving in duration must be firmly established and the Project Team have to deliver that saving. The Project Team also have to show how the extra money awarded for fast tracking was spent. It’s not a contingency pot.

The cost of Fast-Tracking must be calculated and built into the budget.

The relationship between the two is very simple.

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The relationship is simple but the underlying mathematics are not.

Where the lines cross over is not the optimum point between time and cost. The optimal point is where the overall project duration is reduced enough to meet the end date. Check that the project sponsors are willing to pay the price.

It’s best to establish what your desired duration is then check the additional cost. Do it one-at-a-time or you’ll be tangled up for ages.

Ends.

 

 

NATO – I hope these guys don’t intend to fight a war any time soon

images-2The NATO Headquarters will be in the news this week. For all the wrong reasons.

 

 

Most of the project tools we use originate from the military. Critical Path Networking (Nuclear Submarines), Supply Chain Management, Cost Controls, etc.

But it seems that when it comes to using these tools to build a new headquarters the tools weren’t applied.

BUT – any project launched by an organisation of 29 countries to be run by the Belgian Authorities has one foot in the grave and the other on a skateboard.

The project was sanctioned in 1999. The project got underway in 2010.

The original budget was Euro 457.6 Million. A UK company called BAM UK won the contract at Euro 650 million but the Belgian Authority squeezed that down to Euro 240 million.

BAM UK ‘s motto is ‘we deliver what we promised on time and on budget. The final price will be in excess of Euro 1.4 Billion and it’s 4 years late.

The original project duration was 4 years. BAM UK managed to have that increased to 6 years. So, completion in 2016. It’s being opened this week mid-2018.

The NATO Secretary General Jens Stoltenberg said last week ‘that the building met it’s original budget and is only a year late’.

I suspect that the building is far from complete and that all cranes have been taken off site until President Trump goes to hit the white ball. But before he leaves that Euro 1.4 billion is going on Twitter.

A thought. Would your company have taken that project on?

My view?  I’d have grabbed that baby with both hands and dived in head first from a very great height.

Because. 1) NATO pay their bills 2) growth couldn’t be anything else but exceptionally high 3) the project would never be cancelled (too political) 4) it’s managed by the Belgian Authorities (Yahooooooo!!!!)

As I said in a previous blog What if a Risk Was An Opportunity in Disguise? This is a good example.

All it would remain to do is to mobilise a Claims Director as the first person on the project.

Ends.

 

What If a Risk Was Actually An Opportunity in Disguise?

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Companies in general identify project risks and look at ways to avoid them. Often the risk is too big and they step back to let someone perceived as foolhardy to take the job. But what if your company could take risks that no other company would touch with a bargepole?

What if the risks other companies saw as too dangerous were risks that you saw as an opportunity?

Take a look at this incredible feat of risk taking

Now, the question. How did he do that?

My quick run through

  • he was fit
  • he was in charge of the entire stunt at all stages
  • he had previously done many smaller jumps
  • he had the right equipment
  • he had trained
  • he had the right people around him
  • he had practiced the jump before filming started

There’s nothing in the list about him being totally insane or stupid.

And my point is?

True Risk Management isn’t about avoiding risks, it’s about assessing them and looking for ways to accept them, ways to take them on such that they can be done. Ways to make a healthy profit by doing things that ‘normal companies’ can’t do.

And the advantage of that approach? Your company could then take on projects that other companies think you’re mad to even accept the Invitation to Bid.

(I know lots of companies take on very risky projects – but that’s more about corporate stupidity than risk management).

So, have a think about that. What would your company have to do to take on the equivalent of what is shown on that video?

My top answer is ‘be fit’.

Could your company ever be that ‘fit’?

And why not?

 

Ends

 

 

 

 

 

The Project HSE Risk You Haven’t Spotted Because It’s So Gigantic

This HSE Risk Cannot be Seen With A Magnifying Glass

HSE has gotten pretty good over the years. PPE, Tool-Box Talks, Awareness and so on. All great initiatives that have save many lives and prevented uncountable injuries. But there is a macro-risk that goes unnoticed. A risk that can be identified but usually in retrospect.

It’s a risk that can force people on site to take unnecessary risks, seek shortcuts and put people in danger. It’s hard to spot because it doesn’t show up on site, it’s a risk-mechanism that started (perhaps) even before design began,

If the managers on site stick strictly to their procedures they can avoid the danger but when pressure grows there can be a tendency to waive the rules.

So, what is this monster? How can this HSE risk manifest itself in the early phases of the project and yet no-one sought to stamp on it?

Well it’s because the people who created the monster and the people who have to deal with it never meet. They live in two different worlds. And the HSE Department is in neither.

The monster’s name? The Fixed End Date.

Doesn’t sound very scary or unmanageable, does it? But it is.

The Fixed End Date appears around the time the project is sanctioned and funded. The profitability of the venture depends on the date being met. All of the finance revolves around that event. Nobody from HSE is in the loop.

The project players say the date isn’t fixed. It’s variable with a confidence range (+20%/ – 10% is tossed around at that time) BUT when someone senior enough sets a date it hardens quicker than fast-drying cement.

The other factor is that the date may have been chosen to suit a non-project objective. Nothing to do with ROI but could be about a royal opening, prestige, a gong for the company owner. A host of reasons that fix the date in solid stone. And the project manager isn’t selected yet.

Let’s skip to the period in time when the end date looms large. All of the activities are either critical or loaded with negative float. Additional work that has been hidden forces it’s way onto the agenda. The secret life of the project bursts out into the open like an alien out of John Hurt’s chest.

Someone pushes the red button. The people on site take incoming. The monster rears it’s head.

The long lunches at sanction stage, the prevarication/ procrastination/ political infighting – all forgotten. The task now is to get the welders to weld faster. The drive is to flood the worksites with men, machinery and equipment. The bugle calls up a night-shift, a back-shift, a miracle. A window opens and Commonsense throws itself out.

The project enters a fugue state where there is a hunt for the guilty and punishment for the innocent because the Great Fixed Deadline Has Not Been Met!!!!! And nobody told ME.

Of course, a welder cannot weld faster and the only possible outcome from throwing people into the breech is a steep rise in the probability of an accident. All because a group of people in the possession of scant knowledge with only a vague plan set a Fixed End Date for the project a long long time ago.

The only thing the Project Manager can do is to run a copy of all the weekly, monthly and quarterly reports that showed the real and moving end-date as identified by the Critical Path Network from when he started on the project right up till time now.

If Project Managers don’t have that paperwork? Then hell mend then.

 

Ends

 

 

 

 

 

Projects. A Critical Path Network Idea You Never Thought Of

The Critical Path Network.

Yes, the old CPN again. My mantra.

When I worked on a Chevron project many many moons ago, their Project Manager taught me something that I think is truly amazing. It’s so obvious that you’ll wonder why everybody doesn’t use it – but few companies have a decent enough CPN to enable it’s use.

A usable CPN.

If you don’t have one there’s no point reading any further, the content of this blog will be academic.

If you do have one, update it to ensure all  vendor activities are in and correct.

Now, one at a time. List all the vendor activities ranked by criticality. A criticality rank is given by the number of days float the activity has. Zero float means it’s on the Critical Path. Two days float means it will go critical very quickly. Negative float means your CPN is bollox – go and fix it so that there are no negative days.

Having done all that, start with the most critical vendor with the most expensive Purchase Order – that vendor is a threat to your project. You need to protect yourself.

Next step

Here’s what I was shown to do – an act of sheer brilliance.

Arrange to visit their top managers at their premises. If the the owner can be present that would be excellent. Not the Project Team and not the Buyer. This is not a team meets team or a buyer meets buyer. The top management team + PM. No doubt they will invite the Buyer anyway.

The reason for your visit is simple. You want to show your appreciation.

To do this you will

  • give them a presentation on your project
  • show them how critical they are to your success*
  • allow them to present their company profile to you
  • allow them to show you round their facilities
  • and YOU then buy THEM lunch.
  • Have a photo opportunity, to which the local press can be invited, where you will give them a memento of your visit (something inexpensive with the Project Logo on it)
  • After lunch – ask them for assistance to get them off your Critical Path. What idea’s do they have? What can be done? Explore the possibilities. But more money is never an option.

* a cynic may think this is a good opportunity for the vendor to hump you. Let’s not go there, but keep it in the back of your mind.

Back at home office

  • Assess the suggestions
  • Insert them into the CPN one-at-a-time (biggest schedule opportunity first)
  • Run the network after each insertion. See what happens.
  • Take the benefit
  • Let the vendor know that their suggestions were helpful – and if they have any more? Call this number.

Maybe It’s Not All Good News?

A potential spin-off from this approach is that perhaps not all is well with your order. And you didn’t know that. Let’s say – you ordered the wrong item. If nothing positive comes from the visit then at least you know something you didn’t know before. And you’ll be sitting at a dining table with the people who are going to fix the problem for you.

Why is a vendor so important?

On site. You can always whistle up some manpower. You can wangle a permit. You can conjure up a crane. You can dig holes, move earth, shift sand. But if you don’t have a valve? You do not have a valve. End of.

If you don’t have the valve you’re goosed

 

 

 

 

 

 

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Zen and the Art of Projects

In 1976 a American professor called Richard M. Pirsig published his book Zen and the Art of Motorcycle Maintenance. It was a massive hit around the world.

It’s a simple tale by the professor who takes his son on a motorcycle trip from Minnesota to California. But the underlying theme is about the philosophy of quality. An investigation into what quality is and how it can be defined. That is somewhat more complex.

It’s All About Quality

Luckily for us project guys the definition of quality is not so ethereal or elusive as Mr. Pirsig imagined. He discussed the qualities of life, we only have to concern ourselves with the quality of a project.

I’ve found that Quality Assurance is not given its due status in the project world. I had a pretty casual relationship with it myself. And that was because I didn’t understand what it was really for. I didn’t understand (back then) that the Quality of what we were building was the most important part of the project.

Yes the project could be on time, under-budget with a great HSE record. But if it didn’t do what it was paid to do then all our efforts were for nothing.

To me quality was all about dye-pen testing and tracking the origins of steel and sifting through vendor documents, it was quality control. But its higher calling is to ensure that the project produces an end-product that is of the quality expected by the people who paid for it.

To understand that we have to go back to the Contract and the Specification.

Let’s say we’re going to build a water-treatment plant. The specification tells us what the water-in will probably be like and what the water-out needs to look like. Usually a range of values, upper and lower specifications. The design talks about the volumes of water to be processed, the temperatures and so on.

Quality is engineering, procuring, constructing and commissioning a water-treatment plant that delivers the required volume of water within the specification range demanded. And it has to keep doing it for its entire life-cycle.

Producing a plant that is of a lower quality or a higher quality is not what’s been paid for. The plant either doesn’t produce the right specification of water (lower quality) or it is too expensive (higher quality).

The old adage that you don’t expect a Rolls-Royce when you pay for a Ford kicks-in here. Conversely you didn’t pay for a Rolls-Royce for a Ford to turn up at your door either.

In our world Quality is not subjective, its a hard target.

If you’re interested in the quality of life, read the book – it’s still relevant. The road trip is engrossing, and disturbing.

Zen and the Art of Motorcycle Maintenance

Ends.