Open Letter to Process Plant Personnel - A Gap Analysis

To: IT Managers, Plant Managers, Department Managers, and members of your Maintenance, Engineering and Operations Teams

From: The TeamWork Group's Maintenance Management System Developers

Subject: Maintenance Management System (MMS) Requirements and a Gap Analysis between what you have now and what you could have now

Date: May, 2009

In this communication we trace the following:

• Review of general needs for Asset and Work management in a plant environment, including maintenance (routine, preventive, predictive and turnaround) and capital projects
  
• Current situation at your plant, along with a discussion of gaps between the current situation and the desired needs
  

5 BIG General Requirements for Plant-wide Asset and Work Management

• Integrate with condition monitoring (CM) systems
  
• Manage the entire work cycle and associated data
  
• Manage all asset history and provide reliability calculations
  
• Manage general and specific plant information
  
• System support and configuration of the MMS to suit evolving needs
  

We now discuss each of these requirements in more detail. First we state why these are crucial to the operations of the plant, and then we perform a comparative gap analysis to point out the issues that may exist in your operations and maintenance environment.

Integration Links to Condition Monitoring (CM) Systems

A process plant's assets are the core entities that must be kept in top working condition in order to ensure that the returns on the investment (ROI) of the company, and its investors, are maximized. This means that maintenance work, which ensures the long term viability of each asset, is a core function that must be managed. For this reason, each plant has a number of systems that monitor the operating conditions of assets. Vibration monitoring is used to monitor the performance of rotating equipment such as compressors and pumps. Leak measurement systems are used to measure leaks of hydrocarbon gases from valves and fittings. Corrosion measurement systems help the engineering department to ensure that the piping and vessels maintain a thickness that allows them to operate safely and efficiently. Inspection systems provide a means for recording salient operating factors associated with each asset. An effective work management system links with each of these (CM) systems and provides a means to readily initiate the work cycle by creating work requests for review and approval by management.

Work Cycle Management

The work cycle that starts with a work request and finishes with a satisfied customer (in Operations, Safety or Inspection) is seamlessly managed in a single, user-friendly system. This means that proposed work is:

• Reviewed by supervision - if it is approved, then it is
  
• Planned by planners, after which it may be
  
• Scheduled to be worked, unless it is waiting for
  
• Materials procurement based on plans and estimates, after which it is
  
• Executed by the field, then
  
• QA'd (Quality-Assurance) by Inspectors, and if OK then
  
• Accepted by Operations or Inspection. During this entire process,
  
• Costs are tracked, including the estimated, budgeted, committed, expended, incurred, planned, earned and forecasted costs.
  

Each of these critical facets of the work cycle, including change management, must be managed. This management should occur naturally within a single continuous work flow system. Documents, communications and approvals associated with the work should, likewise, be monitored and tracked.

Asset Reliability and History Management

The work management process ensures that work is defined, tracked and accomplished in an efficient manner. The data collected during the work cycle must be analyzed constantly using statistics-based analytics. The results of these real-time analyses provide management with a believable and sustainable basis upon which they can make their decisions. Such as: Should a heat exchanger be replaced during the next turnaround, or should it undergo repairs? Is a pump that routinely suffers from cavitation incorrectly designed for its task? Should it be replaced?

Plant Information Management

The engineering data that is necessary for maintenance and operations analysts to make quick, informed decisions should be available quickly to all people who make decisions in the plant. This includes the most recent design calculations, specifications, documentation and drawings for each asset and process system in the plant. A complete plant management system provides an object-oriented documentation management system. This system ensures that asset-related data is always available to the planners, the field personnel, the inspectors, operations, etc.

System Maintenance and Support

The computer system (in this age of the web, this sounds like an archaic term, does it not?) that you use must be responsive to your needs. This is an often-overlooked, yet extremely critical, aspect of managing your plant. The long-term impact and cost of not paying due attention to the capability and capacity of your MMS tool as well as your solution vendor to meet your needs is measured in the millions of dollars. Study a few of the root causes of unexpected plant equipment breakdowns. They can often be traced to the fact that inadequate attention was paid to the warning signs that were being collected in the work cycle. Many CMMS vendors are companies with thousands of disparate customers in different industries. They maintain a wish list of improvements. Your foreman's great idea has to percolate through many internal levels of corporate bureaucracy, in your company, to the IT team that has access to the wish list. The IT folks dutifully add the requests to the list - but do not have the passion to explain the reasoning behind or the need for the wish list item. Sadly, the people that should have input into the improvements in an MMS are often the ones that are ignored and told to 'just use the system'. If they complain, they are branded as non-team players and troublemakers. Our experience is that these are the people that we should be listening to. These are the folks that are on the front-line and that are intimately familiar with the processes, good and bad. These are the people that we ignore, and then wonder why we need to replace yet another system.

In order to enable users and system designers to interact with each other, your software supplier must have people ready to work with your users. This often means having someone on-site with your people on a daily basis to better 'feel their pain'. This is a, seemingly costly, process that pays great dividends in user satisfaction, as well as more complete usage of your system. A quick review of the number of spreadsheets in use at your site is a good indicator of the sheer volume of data that is NOT being managed in your system. Too often, corporate system managers simply ignore these compelling facts on the ground and take cover behind the products and services of big-name companies like IBM, SAP, Oracle and others. Not only is the product and service package from these companies expensive, they simply serve the needs of the system managers. Business users get the short end of the deal. Try to avoid this when selecting your vendor. Ensure that they have a proven track record of customer support - in your 'trenches'. They should be familiar with your business processes. That should be the over-riding issue - as opposed to their claim to being a CMMS or an ERP.

How does your process get managed today? What are the gaps that must be bridged to a more efficient process?

The main issues, that we have discussed: Integration of CM Systems, Work Cycle, Asset and Reliability, Plant Information Management and System Maintenance and Support, are all so core to an operating plant that they are all being done today in your plant - using a variety of tools. We now briefly review the typical scenarios that we have encountered and suggest a better way to streamline each of these processes.

Smart Linking to Condition Monitoring (CM) Systems

Many specialty system vendors specialize in the supply of a variety of CM tools. You probably have vibration analysis systems, leak measurement systems, inspection system in your plant already. These systems are supplied by companies that also provide the hardware that generates the actionable data. However, look a little closer. Is the data from these systems processed automatically? Will the results of a leak detection process, for instance, automatically trigger the creation of a work request to fix a valve? Typically, this process is heavily manual. The results of the leak detection are sent to the Planners. Planners create a spreadsheet that is then reviewed. Then the planner creates a work plan in the planning system. These are 3 steps that require three human interventions in what could be a simple and streamlined, business-rule driven process.

Your MMS could be configured to poll the CM systems and, based on actionable thresholds, be able to produce work requests that are the start of your work management cycle. In addition, your MMS should alert your engineering and reliability people if any work request has been created for an asset on a frequency that is greater than the PM frequency. This gives them a heads-up and an opportunity to review and analyze the issue.

What is the cost of manually bridging this gap in information flow? What are the consequences or errors due to re-entry of asset information?

We'll leave that analysis to your business processes. What we can say is that The TeamWork Group's TeamWork 2k system has been designed with a strong awareness that the systems operating in your plant should work together, like a team. TeamWork 2k's Integration Manager provides many tools that help to integrate data flows between these systems and your primary work and asset management system. Your business rules for managing the flow between systems are also easily integrated into these processes. Imagine the convenience of having your major data islands all connected with each other. Of course the security concerns associated with regulatory programs such as SOX and TSX are addressed. In addition, we ensure that a security framework ensures that each member of you team has access to data that is appropriate to their (business-rule based) position.

Conclusions: Teamwork 2k is a great addition to the tools that you already use, and will help you to replace scores of spreadsheets and ad hoc databases by consolidating their data into a single, user friendly database that is accessible by a web-based interface.

Cradle to Grave Work Cycle Management

Current MMS systems come in similar flavors. They have data stored in a database. The Work orders (or notifications) are the typical mode for tracking work. As work progresses through its various phases, it is left to the user to manually change these phases. Scope change management is not an automatic process - rather, it relies on users to state that a change is occurring.

A business rule-based system that automatically changes the status of work orders should be implemented. This would ensure that arbitrary changes in status based on the data entry person's limited perspective will not skew the data in the system. Likewise, business rule based change management system is a huge benefit, as it enables automated tracking of changes, without imposing an additional burden of data entry on your users. This data is collected, and analyzed, automatically.

The typical work cycle weaves its way from initiator to supervisors to department leads to planning to field execution to QA and customer acceptance. Each of these points should have opportunities for the recording and storing of pertinent comments as well as attached site photos, equipment drawings, sketches, faxes, videos, etc. An audit trail of the decisions made during any aspect of the work cycle should be readily available to your team for review and analysis.

Intuitively, we know that scheduling of work is a critical component of the work cycle. However, systems currently in use are woefully lacking in this area. Typically, the solution is an add-on scheduling system that is not an integrated component of the work management system. While these are scheduling tools are admirable in their own right, badly designed 'bridges' and data transfers to and from these systems from current MMS's result in poor models of the maintenance backlog. In addition, the use of these scheduling tools means using schedulers, which means more cost to the maintenance budget. This is a very expensive way to go. Especially when one understands that scheduling is heavily rule-based. If these rules are built into your system, this results in a streamlined component of your work flow process. Your planner's plans simply flow into the schedule when they are completed, approved and materials and resources, human and equipment, are ready to perform the work. Your work execution staff will now get the work done as scheduled!

A huge asset in your project management team is your Execution staff. These people are your best source of excellent and timely field data. The 3 things you want to know each day are:

• Are there any problems - especially safety issues? This includes reasons for delayed work.
  
• Who did what and for how long? Another word for this is timekeeping! They can dramatically improve the accuracy of this process.
  
• What progress was made? This should be reported as a remaining duration for the task at hand. This leads directly to an evaluation of earned value.
  

Too often, during the execution phase, all of the details that the field provides are lost because there simply is no workstation or process available to foremen and craftspeople to report their knowledge back to the system. We see this as a major disconnect. So many decisions are based on the situation at the 'work face' that collecting information directly from it should be a major priority. We seem to be afraid of involving field personnel in the data gathering process, while we completely depend on them to do the work efficiently. The prevailing approach seems to be: Give them just the information that they need to do the work. Our experience has shown that involving the field simply helps you to improve the opportunities for more successful outcomes.

TeamWork 2k is a work management system. You can estimate, then budget, plan and schedule your work - starting from drawings or from issues encountered in the plant. Once the work is being executed, many tools within TeamWork 2k enable your workforce to provide timely feedback. When this feedback is processed and presented to, or accessed by, the management team, it becomes a solid basis for decisions that affect the project, maintenance plan or turnaround.

Conclusions: TeamWork 2k provides a real, cost-saving, opportunity to bring all of the work management cycle into one, efficient and focused, process.

Reliably run your Assets

Your inspection department collects information about the rotating and fixed equipment in the plant. This information should constantly be processed to ensure that there no hidden patterns that are leading to nasty surprises. Currently, you depend on the re-entry of this information into Excel spreadsheets in order to produce Reliability data that provide your engineers that data that they need to recommend appropriate solutions.

TeamWork produces Weibull and other asset KPI calculations for each asset based on data that is collected within the work management process. This ensures a timely and more accurate process for managing, computing and reviewing reliability data.

Conclusions: TeamWork 2k could well help to reduce the number of data islands that exist. Reliability calculations can be modeled within this work management system.

Plant Information Manager - your PIM

Where is your plant engineering specification data today? Is the electrical, instrumentation, piping, rotating equipment all in one system? This is likely not the case. Typically, we find this data in different Excel spreadsheets and Access databases. These are disjointed methods for managing this critical data. Line lists may exist in an Excel spreadsheet. Likewise, your electrical line data is also in spreadsheets. A disparate and department-focused system for managing these critical plant data elements is a recipe for ongoing problems.

TeamWork 2k, flexible database and consistent reporting framework can easily be made to replace these disparate systems - on integrate seamlessly with them. In doing so, your data is available to the people doing the work. This ensures a more efficient workplace and a huge cost savings for the plant.

Conclusions: Consider TeamWork 2k, your work management system as the repository for all of your plant information - including OEMS, electrical, instrumentation, piping, rotating equipment, etc.

Software System Management

Observe your current ERP and CMMS systems. Are they responsive to your day to day needs? Things that we hear often are that they are simply not responsive at all. It takes years to implement these systems. When the budget for deploying these systems runs out, the expensive consultants are sent packing. The result is that the systems are left with little support. As these systems are not work and asset focused - usually, they pay more attention to accounting issues - they are not appropriate for managing work and assets. Each plant has its own work culture, jargon and other 'hot button' issues. These expensive ERPs and CMMSs are not easily modified to adhere to the plant's needs. Instead, they are deployed in a way that attempts to change the business process of the plant.

TeamWork 2k was developed with the knowledge that each client user has a business process that has kept them in business for a long time and that is generally sound. TeamWork 2k can easily be configured to assimilate the business rules of your plant and to be an asset to the work management process, as well as your tracking of compliance and other maintenance measures. Add to this the fact that all of this functionality resides in a single system and the benefits simply continue to mount.

The TeamWork Group also provides a complete hosting service for the software that you need. This means that you can have complete access to all of these tools and features without the need to install the system on company computers. What does this mean for your users? Here are a few benefits:

• Complete and constant vendor support
  
• Reduced need for long upgrade and update cycles
  
• Hugely reduced cost of management of the system
  
• Web-based access
  
• More robustness and constant availability than when using in-house resources.
  

Conclusions: This is a great improvement over current intelligent system paradigms.

Thanks for taking the time to read through this post. If you need the services described here, please visit our website: www.teamworkgroup.com and contact me at cpmonteiro@teamworkgroup.com

 

 

 

Live Scheduling

Live Scheduling

The train is leaving the station. Are we on it?

Imagine a world where we can stop things from happening until we are ready for them to happen. Not ready to catch that flight? It can wait. Not ready for dinner? It can wait.

Clearly, these scenarios are non-starters. The rest of the world continues on its preset schedule. Why then, are we so willing to accept the existence of an out-of-date-schedule? Common excuses provided include: "The data is not ready". "We are waiting to hear from the contractor". "The equipment vendor has not got back to us as yet". "We are working on the man-loading". "The logic is not right, yet". Are these familiar? Are people working on the project? Is progress being made? If so, then you should be working to the plan. And this plan should be 'scheduled'. If you are not doing so, you could be held accountable, by your company, for mismanaging company resources.

Does this sound too severe? In the light of recent examples of poor management of funds and associated risks, it would seem that a little more accountability and a little less freedom with company and investor funds is not a bad thing.

In this article we discuss various aspects of managing projects and plant maintenance turnarounds. In particular, we review the barriers that are commonly placed in path of project visibility and address the various tools that can be used to attain the desired level of transparency, accuracy and timeliness in project reporting and analysis.

Time and Money - the twin company resources

The two primary aspects of project management, after safety, are the management of time and money. The discipline of project controls is designed to manage these two critical aspects of projects and turnarounds. If you can reduce the time (i.e. duration) and the money (i.e. cost) of your project, you can save money and this is considered a good thing. The project manager (PM) that consistently brings projects in ahead of schedule and under budget is a hero and a valuable person in the organization. A major tool that the PM needs is a clear view of the planned costs and schedule from the outset of the project. Before corporate managers approve a project, they too need to know the proposed budgeted and the schedule timeline for the project. The budget and schedule may initially take the form of a planned expenditure curve. This is also known as a cash flow curve and when the cumulative cash flow is plotted against time, the shape of the curve approximates the letter 'S' and is often referred to as the S-Curve. This Planned Cost S-curve is a single diagrammatic representation of the cost and schedule of a project. In order to effectively produce such a curve, all components of the project's work must be included in the process. In many construction-related projects, the major phases are Engineering, Procurement and Construction. For this reason, these are also known as EPC projects. A discussion of how to produce a plan and a schedule for EPC projects and Maintenance Turnarounds follows. We discuss ways to overcome the common pitfalls and obstacles to the time production of a live schedule.

Staging a Successful Project

A project evolves through a predictable sequence of stages. The transition from one stage to the next is called a Stage Gate. The project undergoes a metamorphosis when it transitions through the gate between one stage and the next. During the Scope Development and Approval stage, there is very little in the way of project detail. This lack of detailed information makes it difficult to estimate the cost of the project as well as its duration. Scope developers and estimators prepare an estimate that is based on broad parameters. For example, if the project is to build a pipeline for 100 miles, the costs of previously completed pipeline projects may be used as a basis for estimating. If the project is to install a heat exchanger, the estimator can use a table from a reference such as Richardson's or Mean's to estimate the time and relative cost of the project. This type of estimate is known as the 10% estimate. This is because there is 10% or less of the detail that the project will eventually have following the engineering phase. Management approves the project based on the costs and schedule that they see in this stage. The amount approved becomes the Original Budget. The timeline is the original baseline. Any changes that occur in the project that result in changes to the budget must be approved as a change authorization request (CAR). The Revised Budged is the aggregate of the original budget and the changes. Likewise, changes may impact the baseline and result in a revised baseline. Some companies refer to the budget and schedule as the target budget and target schedule.

The Engineering Stage kicks off the process of detailed engineering. During this phase, detailed design work results in the production of detailed drawings and analyses. Halfway through engineering, it may be possible to create what is commonly referred to as the 30% Estimate. This estimate, with its extra detail provides a more accurate view of the projected costs of the project. Management uses this new information to modify the project budget and schedule - usually by changing its scope. These changes result in a changed schedule as well. The Maintenance Turnaround equivalent of the Engineering stage is the Scope Development Phase. This occurs during the year prior to the major turnaround.

Toward the end of the Engineering stage the drawing's are 'Issued for Construction' (IFC). At this time a 100% estimate provides a much more accurate estimate of costs and duration. By this time, management may have already committed to the procurement of some equipment and materials that have a long-lead time for fabrication or manufacturing and delivery.

The Construction stage ushers in the contractors and vendors that are responsible for building the project. The input provided by these organizations further contributes to the fine-tuning of the budget and the schedule. In Maintenance Turnarounds this is known as the Maintenance Period.

While construction proceeds during the Execution stage, and maintenance proceeds through the maintenance period, the progress provided and the field conditions encountered cause a new and accurate schedule to be available virtually every day. This is a live schedule that shows the way that work is unfolding each day and each shift, if needed. A Baseline schedule is maintained for the project. This is the approved budget and schedule. As the project or turnaround progresses, additional scope is discovered and included in the project based on field considerations. These changes are reflected on a 'current' schedule. A comparison between the current schedule and the baseline shows variances that may need further approvals by management. You company's business rules determine the processes for managing the documentation, approval and inclusion of scope changes in the current plan.

During each of the project stages a new schedule emerges. However, we prefer to see all of these schedules as the same schedule - just in different stages - just like the project itself. If we maintain the schedule in the same environment (software, database, etc.) then we can have the baseline to track the evolution of the project though it's multiple stages. In the next section, we discuss the components of an integrated scheduling system.

Components of an Integrated Project Scheduling tool

Each project is broken down into component pieces according to a variety of breakdowns. The WBS or work breakdown structure is the most common tool for coding aspects of the project. For estimating and planning purposes, it is common practice to break a project down into work packages. An estimate work package is not the same as a plan work package. An estimate package is focused on materials (commodities), their quantities and unit rate costs for them. Labor costs are included based on standard installation rates. Plan packages, on the other hand are focused on the physical installation at the site. An integrated estimating and scheduling tool allows the costs of an estimate to be spread accurately along the duration of work items in the plan.

While a project progresses, there may be changes in the numbers associated with the project. These include the following:

• Quantity of materials (commodities)
  
• Unit rate cost of materials (commodities)
  
• Unit rate cost of labor
  
• Productivity
  
• Duration of the work
  
• Physical Quantity to be completed
  

Changes to any of these items results in changes to the cost and the schedule. An integrated project scheduling tools provides the means to track changes to these items, document them, get them approved and display their impact graphically as changes to the baseline and current target cost as well as completion dates for the work inclusive of the changes.

Changes - be aware of them and track them

Knowing the source of each change makes tracking the reasons for the changes a much easier and accurate and believable process. This tracking should occur automatically, without the need for onerous data entry and approval cycles. For example, if the client's field manager asks the foreman to work on an out of scope valve in the vicinity of the in scope work that is being done, the foreman may simply deploy his people to do the work (safely!). The system should allow a new work item and work package, if needed, to be added by the foreman or his/her timekeeper. Adding a work item 'on-the-fly' is critical in order to allow the plan to accurately reflect the actual work as it is done in the field - rather than being forced into the pre-built schedule. Think about this for a moment! We are saying here that a schedule should accurately reflect what is going on in the field. This is not a crazy idea. Yet how often do we see a schedule change due to field input? The weekly or monthly report that includes the schedule simply continues to report progress based on the baseline schedule. It pretends that what is happening in the field is not important enough to be reflected on the schedule. No wonder that the field often gets the work done despite, and independently of, the schedule. The foremen resort to Excel spreadsheets to outline the work for their crews and to record their progress. A disconnect grows each day that the field is disconnected from the plan and the schedule.

The main issue is to have a system be a reflection of the work as it is happening. By doing this well, it can also serve as tool for management to see where things are really going. In addition, the field is now co-opted into maintaining a much more accurate plan and schedule. This means that they are more likely to actually use the schedule to help them in their daily what-if analyses. Such as: 'Should we work 4 weeks of 12 hour days to crash the schedule?" or "Should we simply hit the critical path work for the next 4 weeks and 2 12 hour shifts?". Again, a live, and living, schedule is a tool that many projects are simply not using today.

Remove the Obstacles

Why is this? Too often, on the scheduling 'island', schedulers see their mission as to simply produce a schedule on a bi-weekly or monthly basis. They are simply auditors of the project execution. They are not integrated into the actual execution process. This is an expensive way to go. The scheduling function in this scenario is an overhead that the project cannot afford. The cost-effectiveness of a schedule and the scheduling process should be proved every day during the execution phase. When the field personnel use the schedule to help them deploy their resources and to report progress, then the schedule is doing its work for the project. This is a desirable outcome, and the way that it is achieved is by closely incorporating field input into the plan and the schedule that is derived from the plan. In real terms, this means that the plan and the schedule are owned by all of the people on the project - and not simply by the scheduling group of 'expert' schedulers. Once it is clear to field personnel that they are integral to the plan and schedule creation and maintenance, they will provide the best and most accurate and useful input into the schedule. This input results in far more accurate earned and actual data for each of the work items and work packages in the project's scope of work. When this data is rolled up to the project-level summary report, management has believable data that is built on, effectively, real-time input from the field.

It just does not get any better than this! No PM wants to live in a dream world. Not for long, anyway. The timely field will keep the project grounded, every time.

Takeaways for Live Scheduling

We now summarize the salient issues involved with Live Scheduling.

• Always have a schedule - no matter what the phase of the project. As the project evolves into its various stages, the plan and the schedule that is based on the plan should be 'fleshed-out' with detail. Use the 'do not schedule' flag to prevent work items and work packages from being included in the schedule before they are ready to be included (ex. while you are building the detailed schedule), or after you create a more detailed schedule.
  
• From inception of the project, establish a regimen of a daily schedule. This means you collect progress and actual data daily. It also means that the schedule is computed daily from the plan. This ensures that it is a living entity that the engineering, procurement, maintenance and construction personnel can use each day as they execute the work.
  
• Ensure that change management is built into the planning process by implementing company business rules. This ensures that the plan and schedule will always reflect what is happening in the field - and not just what was planned to happen. Do not be afraid of changes! They will happen anyway.
  
• Integrate your timekeeping with the plan. If your actuals are charged to the work in the plan they will, by definition, be accurate. The use of work orders or WBS codes in the timekeeping process is the single biggest area where bad data is collected in an organized way into the system. Using your plan and schedule in this way ensure accuracy in an area of heavy data acquisition - which means that this is an inexpensive way to get great data.
  
• Provide your field supervision (foreman, superintendents) with tools to let them view the current live plan and schedule as well as enter the latest field conditions into the system. This integrates them more closely with the project process. This results in better information, more quickly and in both directions - to the field and from the field. Amazingly, this also reduces their workload (no timesheets to be filled!) and helps them to 'work smart' by leveraging the information that they have into change management, progress reporting, timekeeping as well as workforce deployment for the next day's or next shift's work.
  

OK - Now we know what must be done - what tools do we need?

The TeamWork Group has built a suite of tools that are configurable to each client's business rules while ensuring adherence to conventionally accepted project management practices as outlined in various PMI publications.

The TeamWork 2k suite of solutions includes the following:

• myCosts - This is a WBS-based tool for managing the quantity and unit rate based estimating process from take-off from drawings to the approval process to the creation of a budget. Change management is included in the module. In addition, this module proves the means for tracking cost commitments and cost expenditures in order to provide an accurate picture of project status. Links are available to 'move' the budgeted labor, equipment, materials and contracted costs to the plan in order to obtain a time-based spread of the budgeted costs. Progress from the budget can also be sent to the plan and schedule or be sent back from the plan to the budget - based on business rule implementation.
  
• myPlans - This is a work package-based planning system. It provides the means for the execution team to break the project down into chunks of work (work packages) that can be planned and scheduled as logically integrated sequences of work. These work packages reflect the way that the work will be done. Planners plan each of the work packages. The built-in scheduling engine schedules and, optionally, levels the limited resources to produce a workable schedule based on business rules that govern prioritization, work type, work in progress, etc. Field personnel access their daily work list from the system and use the system to provide daily progress on work done. Built-in Change Management ensures that all changes are assimilated and documented and available for analysis.
  
• eWorkforce - This tool is focused on managing and tracking work done by the workforce on the work items in the work plans in the project. Links between eWorkforce and the work that is planned in myPlans ensures that time (actual or incurred hours) is accurately charged to real open work items. Each contractor that contributes personnel to the workforce may use the system. In addition, time data may be imported into the system from contractor timekeeping systems.
  
• myProjects - This tool is designed to be a quick query tool that permits project managers and other corporate and project personnel to gain a quick view of the health of a project. Quick access to project reports is available. Also, drilldowns into the detailed levels of a project are available.
  

The TeamWork Group has worked hard to ensure that companies that are in need of this technology can easily access it. We have done this by leveraging the internet to help you and your company to easily and securely gain access to the web-based tools that you need to get your work done efficiently and with the least amount of wasted time. You will not need to get approval from your IT group in order to install our software on your system. The only tool that you need is your internet browser.

We are also available to answer your questions - in a number of ways including all of the usual ones: email, phone, IM, SMS texting, etc.

You will find us via our website: www.teamworkgroup.com.

TeamWork 2k and Primavera and Microsoft Project

Note: All trademarks and trade names used in this discussion are the property of their respective owners.

Introduction

In this post, we discuss the roles that these three systems play in organizations that use them. We review the benefits of each tool and how, together, they provide the user with more options. We also discuss exactly how TeamWork 2k communicates with Primavera and MS Project - including how it sends data to and receives data from Primavera and MS Project. As the discussion proceeds, we pay special attention to potential problem areas in transferring data and also point you to more effective ways of enhancing the TeamWork 2k to Primavera and/or MS relationship in your organization.

What is Primavera?

As there are many new business people entering our business environment, we spend a little time here discussing what, exactly, Primavera is. Primavera is a software package that performs scheduling calculations. It was created by Primavera Systems. In 2008, Oracle acquired the company together with its software tools. The most commonly used tools are called P3, P3e, P5 or P6. You can think of these as different versions with P6 being the newest version. Primavera is, justifiably, considered to be the industry standard tool for scheduling of projects. It has by far the most users of any scheduling system on the market. Microsoft Project is its closest competitor. The primary physical manifestations of a Primavera schedule are the graphical outputs that it provides - both on-screen and in reports. These include the bar charts (also known as Gantt charts), logic diagrams (also known as PERT charts), time-scaled logic diagrams (which combine the bar charts with logic), resource histograms (which plot resource usage against time) and cumulative resource curves (also known as s-curves). The tailor-ability of these graphics in Primavera is powerful and allows end-users to directly affect how they would like their outputs to appear.

How about Microsoft Project?

MS project has steadily evolved over the years into a robust and full-featured scheduling tool. It now provides similar capabilities to P6. The same type of outputs are available from MS Project as are available from P6. Some people prefer the functionality of MS project over P6. It has a more 'Excel-like' feel to it that appeals to the legions of Excel users out there.

Tell me something about TeamWork 2k

TeamWork 2k is a business tool that has evolved over the last 20 years. It has its roots in interfacing with Primavera and MS Project. Early on, it became obvious to us that businesses such as process plants (refineries, mills, utilities, chemical plants) required a high degree of adherence to a business process while managing their work. This work includes maintenance, inspection and capital projects work. Plants perform their work on assets. It is imperative that the history of all of the work that is done on these assets be available, in a single database, for use as a reference during the life cycle of these assets. TeamWork 2k has developed as an asset-focused tool that enables all of the work, including routine maintenance, turnaround maintenance, preventive maintenance, capital work, to be scoped, estimated, planned, executed and tracked in a single system. This powerful database is a strategic weapon that the plant has against a number of major and problematic issues. These include:

• Lack of adherence to business rules by temporary personnel hired to help out;
  
• Lack of a standard process for managing all asset-based work;
  
• Lack of a system that connects to other condition-monitoring (CM) systems in-house;
  
• Lack of a uniform system for reporting on the status of assets that are being worked on;
  
• Lack of a system that improves the quality of data, thus reducing the time that people spend re-entering this data;
  

These may seem relatively inconsequential, but the price to a plant of not paying attention to these simple issues is enormous. Already, we have seen that data relating to projects and turnarounds that were scheduled in P6 are not available in the asset database where the routine maintenance work was tracked. This provides a potential for huge disconnects in the plant managers' view of an asset's reliability. Safety is also a potential problem here.

Simply put, TeamWork 2k provides a single asset-focused data repository for work in a plant, that enables plant personnel to make sound business decisions with a high degree of confidence.

What else does TeamWork 2k do?

In addition to simply collecting all of the work-related data, TeamWork 2k includes the ability to do a number of critical functions that are sorely needed by plants today. These include:

Important Project or Turnaround related Work Management Functions	Typical Current Practice	TeamWork 2k Business Rule-based practice
Scope Development and Management	Each source of work (ex. Operations, Process, Reliability, Safety, Inspection, Engineering, etc.) maintains their own multiple spreadsheets in Excel, and send these on an ad hoc basis to the planner when they are 'ready' to do so. Many ad hoc revisions continue to show long after the 6-month deadline. This requires the planner to have to do last-minute incorporating of additional scope.	TeamWork 2k provides each external department with a web page that allows them to enter their planned scope in the same database that is used for planning. When they flag a scope as ready to Plan, it shows on the planners desktop. the planner always has a heads-up on potential new work. This visibility of potential work helps the entire plant staff to be aware of what is still to be done - nothing is hidden away out of view.
Cost Estimating of project or turnaround	MS Excel spreadsheets are currently the primary repository of cost estimates. The work done here is essentially lost to future reviewers of the work scope - as this information is not readily available.	TeamWork 2k provides simple and focused tools that help the estimator to quickly assemble accurate estimates of cost based on the scope of work that has already been identified. As the scope is in this system, there is less opportunity for miscommunication about the scope and the timing of the work being contemplated.
Planning of the Work scope	Currently this is done in MS Excel mostly. Planners are usually well trained in field processes but not so well familiar with computing software. However, MS Excel is well within their abilities. This, however, means that they enter data that has already been entered, and then later this data has to be entered elsewhere.	TeamWork 2k's planning tools allow for a smooth pass-through of relevant data from the scope and the estimate. The planner's planning workbench is easy enough for planners to use without having to learn a complex scheduling tool.
Scheduling of the Planned work	This process is typically handled with P6 or MS Project. This requires yet another entry of the scope of work into a schedule-type format, this time by expensive project schedulers.	TeamWork 2k incorporates all of the tools associated with business-rule-based scheduling. This means that you simply do not need to re-enter any data and can use the data 'as is' to create very effective and accurate schedules automatically. In addition, TeamWork 2k provides simple tools to transfer this schedule data into P6 or MS Project, so that you can take advantage of these programs effective reporting and display tools.
Baseline Management	In current practice, the scheduler remembers to create a baseline schedule when it is determined that one is needed. This is done by using the create Target process in P6 or MS Project.	TeamWork 2k automatically creates a baseline and a revised baseline following the addition of each approved change of scope into the plan. This automation is dated and provides a clear path of the events leading up to the change. This is useful when post project or post turnaround reviews are made to determine the reasons for budget or schedule variance.
Milestone and Period Management	Current practice requires that each milestone be entered into P6 or MS project. Activities and Tasks that lie in a turnaround or project period must be linked manually by the scheduler.	TeamWork 2k employs and automatic milestone generation and automatic linking system. This automates entry of as much as 70% of the ties that a scheduler makes - and it does so in a business-rule based, accurate manner. This is another example of the value-added that TeamWork 2k brings to the scheduling process.
Execution of the Planned and scheduled work	Foremen receive work lists that are created in P6, MS Project or Excel. Often, foremen further simplify these lists so that they can provide them to their crews along with drawings, data sheets and safety instructions as required by the plant's business process.	TeamWork 2k has a module that is focused on field supervision. This provides them a simple way to see their work days in advance as well as enables them to provide electronic feedback on the plan directly to the planners. Electronically attached notes and drawing provide them with a way to print electronic work packages, saving an enormous amount of coordination time.
Tracking of Time (LEMs), aka Incurred costs	In order to accurately track costs being billed by contractors, owners currently employ a variety of tools including dedicated time-tracking tools. These tools are usually stand-alone databases or spreadsheets and require considerable re-entry of data in order to be compared with other project progress data.	TeamWork 2k's eWorkforce tool is integrated closely to the plan and this ensures that time, materials and expenses are accurately charged to work items in the plan. This information is also obtained in a way that actually reduces the overall effort that is spent in collecting this information. Foremen are the source of the information and this helps to reduce the workload on both foremen and timekeepers.
Tracking of Progress	Progress measurement is currently, typically done in Excel spreadsheets. Yes, once again, a new set of spreadsheets is employed in helping to track progress in the field.	TeamWork 2k's integrated execution plan ensures that progress is reported on the planned work items. If a work item or work package is discovered in the field and is not in the plan, TeamWork 2k makes it easy to add. This ensures that people are not forced to 'hide' the costs associated with ad hoc field work, as is so often done today.
Reporting of Progress and Forecasts	The Excel file that is used for determining progress may also be used for reporting progress. Alternatively, addition spreadsheets are pressed into service to help the project controls people to deliver reports that management expects.	TeamWork 2k's reports assemble the data from the plan and schedule. Progress data from the field is converted into earned value. Incurred hours and costs from the field-generated LEMs are compared to earned value at the end of each shift or each day. This provides accurate measures of CPI and SPI for the entire project as well as for increasing levels of detail down to the work item.
Change management	Changes or Extra Work are a routine part of the project execution phase. Current practice involves the maintenance of a list of changes in an Excel spreadsheet. These changes, once approved are then manually added to the project or turnaround scope.	TeamWork 2k automatically tracks changes! It does this by flagging added work automatically. This work remains in the plan and awaits approval, electronically. If the execution people are proceeding without approval, they are not expected to 'hide' their progress or their incurred costs - they have a real work item to charge. TeamWork's eApprovals tool helps to route a change to people with the requisite spending authority. Apporvals result in an automatic assimilation of the planned changes into the revised baseline.
Cost Tracking	Cost tracking and forecasting involves the comparison of Budgeted costs to Incurred costs, Invoiced costs and committed costs. This process is currently almost universally done as a spreadsheet-based exercise by the cost control technician. It involves much re-entry of data and is thus prone to error as well as changing bsuiness rules.	TeamWork 2k's integrated cost tracking tool, allows electronic linking with your accounting system to obtain the invoiced and the committed costs. In addition, incurred costs are obtained from the internal eWorkforce LEM-tracking system. All of this means that your cost tracking information is always at your fingertips - without the need for any data re-entry! Forecast algorithms that are based on desired business-rules are employed to ensure that all of the reports produced by the system adhere to a consistent set of criteria. Management gets used to this and the project team benefits from this consistent approach as well.
History Tracking	Most of the Excel and P6 system do not track history. It is not easy to see when and how changes were made to a work package that caused its scope to grow from say, $100,000 to $200,000.	TeamWork 2k employs a behind the scenes history tracker that keeps tabs on all quantitative and qualitative changes to the scope of work that occurs following an approval of the plan. This means that there is an audit trail that can be followed that indicates who changed what scope and what the ensuing cost of the change was.
Approvals Management	Currently, approvals are a drastically manual and time-consuming process. It is not unusual to see people 'looking' for a supervisor to get the signatures required on certain documents. Imagine the time that both the supervisor and the subordinates can waste in this effort.	TeamWork 2k's eApproval system allows a document that needs approval to be routed electronically to the right person, and from there to the next person until all of the requisite electronic signatures have been obtained. The date that these were signed is automatically save as is the amount of time that it took for the signature to be obtained. Appropriate business rules are available for allowing designees to do the signing.
Document management	Each piece of work done in the field is accompanied, at a minimum, with a safety document. In addition there may be many other drawings, data sheets etc. Current practice involve the foreman or a designee going to file cabinets, retrieving the documents, copying them, then returning them to the cabinet. This process is time-consuming and does not help the field personnel to be efficient at all.	TeamWork 2k's eDocs system provide the means for the field to get electronic work packages - that have all of the necessary documentation ready to go when they send it to a printer. And this is just the start of the benefits associated with the object-focused document and notes management system that is embedded in TeamWork 2k.
Communication Management	Currently, e-mail inboxes and email folders bear witness to the chaos that email has wrought on business processes. Untold amounts of useful, project-specific information are buried in emails. This information would be far more useful if it was available in the project record. Today, people have to manually search their emails while the look for 'something' based on what they remember.	TeamWork's eNotify tool is an electronic means of ensuring that any commitments, comments, requests for information, etc. that are associated with any part of the project are recorded, date stamped and available for review at any time. In conjunction with the myBacklog tool, this allows each project or turnaround team member to be always aware of what is being expected of them and of what commitments they have made.
Issue management	When potential work is first identified, it is not always clear that a work package will be needed. Until that time a list should be maintained. Currently, this list will exist on paper or in Excel.	TeamWork 2k's eIssues tool provides a simple way to manage all types of issues until they move into resolution mode and even until complete resolution. Using this tool ensure that no issues are ignored. Business rule drive the business to address issues in a timely manner.

It should be obvious from this review that managing a project or a turnaround involves far more than can be done in Primavera's P6 or MS project alone. They can be a part of the solution, however, it's the management of the rest of the spreadsheet and databases that is the primary problem that TeamWork 2k resolves. The sheer number of people that are used to manage projects and turnarounds today can be reduced, and those that remain can have a significantly better work product by using TeamWork 2k.

How does TeamWork send data to P6 or MS project?

TeamWork's Export Manager utility tool allows us to create a map from each of the schedule-related elements of TeamWork's database to either P6's structure or MS Project. This task is something that a TeamWork Associate will typically perform for you. You can then simply export your data to MS Project or to P6. Once the data is in P6 or MS Project, you can use those tools to do whatever you wish. Any changes to data made in these tools will not be automatically sent back to TeamWork 2k.

Bear in mind that in TeamWork, a project or turnaround is broken down into work packages. Each work package has one or more work items. Each work item has Resources, Materials and Contracted costs. The following table is a simplified version of a map that shows how TeamWork data generally maps to P6 or MS Project data. A more detailed map is developed for real-life usage of the TeamWork to P6 or TeamWork to MS Project links.

TeamWork Data Element	TeamWork 2k Comments	P6 Comments	MSP Comments
Project	TeamWork 2k handles multiple projects in a work set - typically a work set holds all of the projects that a business unit manages.	P6 handles projects as part of its WBS.	MSP treats a project as a single entity and the data is saved as a single file.
Work Package	TeamWork 2k requires a project to be broken down into discrete work packages. These may be asset-based in the case of a turnaround or contractor or discipline-based in the case of capital projects.	P6 does not have a work package per se, however it does allow you to have unlimited levels of WBS. TeamWork 2k's work package is mapped as an activity code.	MSP does not support the concept of work package directly - however TeamWork 2k's Work package is mapped as a task code.
Work Item	A work item is the basic schedule-able element in TeamWork 2k.	P6's activity is derived from a TeamWork work item. The activity ID is typically assigned by TeamWork as the work package ID concatenated to the work item ID.	MS Project's task is derived from TeamWork's work item. The task ID is a sequential number that is assigned by MSP.
Milestone/Period/Window	TeamWork 2k auto-creates and manages a milestone for the start and finish of each period. A period is a timeframe (ex. pre-shutdown or commissioning) that requires all work items tagged with that period to be scheduled in that period. The period expands or contracts to fit the work in it. In addition, TeamWork 2k supports the concept of a window within each period. A window, like a period, has a start and finish milestone.	Milestones in P6 are manually created as needed and are manually tied to their successor and predecessor items. Period and window functionality does not exist.	Milestones in MSP are manually created as needed and are manually tied to their successor and predecessor items. Period and window functionality does not exist.
Human Resource	TeamWork 2k supports the entry of manpower (crafts, skills, trades, professional) resources.	TeamWork's manpower resources are transferred to P6 activities as created.	TeamWork's manpower resources are transferred to MSP tasks as created.
Equipment Resource	TeamWork 2k supports the entry of equipment resources.	TeamWork's equipment resources are transferred to P6 activities as created.	TeamWork's equipment resources are transferred to MSP tasks as created.
Consumable Materials	TeamWork 2k allows the entry of consumable materials, rates and markups associated with each work item.	TeamWork's materials are not sent to P6.	TeamWork's materials are not sent to MSP.
Contracted costs	TeamWork 2k allows the entry of contracted costs associated with each work item.	TeamWork's contracted costs are not sent to P6.	TeamWork's contracted costs are not sent to MSP.
Calendar	TeamWork 2k employs calendars on each work item to determine the shift schedule that the work is executed on	TeamWork creates a calendar in P6 to match that in TW.	TeamWork creates a calendar in MSP to match that in TW.
Resource rates	TeamWork 2k computes burdened rates for human resources from rate schedules that are part of the contract.	TeamWork does not currently send rates or any costs to P6.	TeamWork does not currently send rates or any costs to MSP.
Resource limits	TeamWork computes resource limits for resources based on available manpower in its employee table. You can also employ TeamWork's utilization rate to allow for unforeseen work scope.	TeamWork does not send resource limits to P6.	TeamWork does not send resource limits to MSP.

As you can see, there are many pieces of data that we currently support sending to p6 or MSP. You can have enough data in p6 or MSP to produce your colorful outputs. If additional information needs to be transmitted, this can be arranged quite easily.

How does TeamWork get data from P6 or MS project?

Bringing data in from P6 or MSP is a completely different problem that sending data to them. TeamWork 2k, is, by design a repository of data that meets the business rules of your business. There is a high level of consistency and accuracy in your data in TeamWork. This is due to data integrity constraints that are built into the database. However, this is not the case with projects in p6 or MSP. In these cases, each scheduler has his/her own pet approaches to handling the scheduling and coding problems in p6 and MSP. The result is that when you compare the work of two schedulers in P6, the results are quite different from each other. If a commitment can be made by the P6 schedulers and MSP schedulers that certain standards will be adhered to for coding the activities and tasks respectively, then The Import Manager module in TeamWork 2k may be employed to manage these imports on a routine basis. In any case, the assistance of a TeamWork Associate will be needed to get this process analyzed and started. Typically, it is less than a day's work to configure an import.

Conclusion

It should be obvious, from this discussion, that TeamWork 2k and scheduling applications such as P6 and MSP are designed to solve completely different problems. As such, they can co-exist synergistically in your organization and can routinely contribute to successful outcomes for your projects and turnarounds.

Please contact us for more information at:

cpmonteiro@teamworkgroup.com

De-constructing Project Progress Reporting

Any trade names that are referenced are the property of their owners

 

Introduction

The most common question that a project's Project Manager hears is 'Where are we?' In order to accurately provide the answer to this seemingly simple question, many pieces of information need to be carefully collected and organized and tracked. In this post, we use common-sense reasoning to explain the project management processes that are necessary to track a project's progress. This de-construction helps us to question our assumptions about each step of the project controls process. This also helps to confirm that each of the steps that we take has a legitimate reason. This, in turn, helps to reinforce the lessons regarding the consequences of NOT taking a particular step in the project management process. This post is intended for readers who wish to learn, or brush up their knowledge, about the basics of controlling a project..

 

Project Management

The term 'Project Management' is commonly used to describe the processes associated with reporting of a project's progress. However, as anyone who has managed a project knows, managing a project involves far more that simply reporting on its progress. The Project Management Institute (PMI) has many explanations and definitions of the kinds of things that PM's do– so we do not go there in this article. Instead, we focus on what it takes to report on a project's progress. At a very basic level, it is the need for accurate progress reporting that helps us determine exactly what items we will measure and against what we will measure them.

 

In order to illustrate the terms and processes that we use, we refer to project management terms as they are used in the North American (US and Canadian) context. The way that tools on the market currently handle project management information is also discussed.

 

What is Progress?

When people request progress information, what they are looking for depends on their focus. The people who are waiting for that new bridge to be completed, so that their commutes will be shorter, are only interested in when it will be done. The sooner, the better! They are interested in the time aspect of the project's progress. Typical pipeline and facility projects are also very concerned about time. However, in addition to this, they are also concerned about the cost of the project. A projected cost-overrun is not a good thing, especially if it is not expected. Time and Costs are the twin core aspects of reporting progress. In fact, the most common reporting tool that management uses combines both of these aspects in a graphical plot of the expenditure of costs over time. This report is a graph of cumulative costs over the duration of the project. The shape of the cumulative curve is similar to a flattened letter 'S' and is therefore called an S-curve. So, clearly, to report progress, we need to be able to do the following:

1. Determine how much more time the project will take
   
2. How much money has already been spent on the project
   

 

How can we do these aspects accurately and effectively?

 

In order to determine the time remaining, we need to know what is remaining to be done. In a complex project, we may have thousands of inter-related items of work that need to be done. Some of these may be completed. Some may not have been started and some may have started and are not, as yet, complete. The schedule is the tool that handles thousands of inter-related work items in a logical network. We rely on the accurate data in the schedule and the scheduling computation to help us determine the remaining time in a project. We discuss how the schedule does its work and how we assemble the data that it needs later in this post.

 

Determining the cost expended appears to be a fairly simple task. Simply add up all of the bills that we have for costs. The materials we have bought have bills or receipts. The equipment that we have rented also have bills or receipts. The contractors that we hired have sent us invoices for each week or each month. These costs are called expended costs and are reflective of the invoices that we have received. However, they are do not show exactly what we have already asked the contractors to provide us – the committed costs. As you can see, the cost issue is getting a little cloudy now. We discuss this the relationship between expended, committed, incurred, earned, forecast and target costs, some more in the section on costs – following the section on scheduling.

Remember, we are de-constructing the progress management process in order to ensure that every step that we take has a legitimate reason.

 

How much time is left? The Reason for the Schedule

The schedule helps us to determine the remaining duration of the project. In order to do this, it needs to have certain information. The schedule must have the following:

• Work items, each with a duration in hours, days, weeks, etc.;
  
• Logic ties, that connect the work items;
  
• Periods, that ensure that work is scheduled in the correct significant period of the project (if needed);
  
• Windows, that ensure that the work is schedule within the correct window within each period (if needed);
  
• Milestones, that define the start and finish of each period and each window;
  
• Human Resources, are identified for each work item. Limits of manpower available force the schedule to be delayed;
  
• Rental Equipment items are identified for each work item. Limits of availability of equipment items may force delays in the schedule;
  
• Consumable Materials are identified for each work item if needed. Delivery schedules for materials are critical to ensuring that the work proceeds as scheduled. Inclusion of materials delivery schedule as well as vendor commitments help to complete the schedule and make it more believable;
  
• Contracted Work, which the contractor provides on a lump sum (as opposed to time and materials) basis can potentially have an impact on, and should be included in, the schedule so that the project manager and project team is not blind-sided by delays due to this work not being ready on time;
  
• Measurable Tasks associated with work items, are included if they provide a means for measuring progress based on the physical completion of work
  

 

The function of a scheduling tool is to use all of this information to help determine the completion date of the work. Logic between work items ensures that they are scheduled to be done in the correct sequence. The human and equipment resources, when limits are entered, may affect the scheduled dates of each of the work items – this is a good thing as we really do not want surprises due to not being aware of the problems associated with having fewer resources available. Likewise material delivery dates. If the material procurement cycle, along with the vendors' committed delivery dates are in the schedule, the schedule computations will result in a more realistic completion date for each work item and the project as a whole.

 

Now, it should be clear that the schedule needs plenty of useful information so that it can accurately complete its function. The project planners are the people that perform this function.

 

Planning the Work – Building an Effective Foundation for the Schedule

We have discussed the need for a schedule that contains all of the time-based work items in the project. In order to effectively create the schedule, Planners break down all of the work in the project into work packages. Work packages are bite-sized pieces of the project – this is a sort of project breakdown that also makes sense from the standpoint of the execution of the work – which is discussed later. A pipeline project is broken down into a work packages for each spread and for each facility. A turnaround project will have a work package for each asset. Once this is done, the planner(s) further breaks down each work package into discrete work items. In the case of a pipeline spread, this would be each of the major work items such as Clearing, Ditching, Welding, etc. Each work item is further broken down, if needed, into tasks. Each task may have a physical quantity as a target to complete. This quantity is the basis for tracking progress for the task. The progress for each task on each work item is weighted and then applied as progress on the work item. This is computed and set as a percent complete and a remaining duration for each work item with progress.. We discuss the issue of quantity and duration-based status in the discussion on the Execution phase of this article.

In any case, the detail of the plan should be the level to which the field will execute the plan and what they will use to report progress and charge their time. The field may decide to add to the level of detail provided by the planner.

 

As earned value is computed based on the planned hours and the estimated materials and contract dollars entered by the planner, you can see that this function is critical to determining the Target Cost as well as the Target (Baseline) Schedule. An inaccurate or incomplete plan is going to quickly manifest itself in a variety of ways. These include poor schedule performance (low Schedule Performance Index, SPI) as well as poor cost performance (low Cost Performance Index, CPI). Unless the plan is improved, its use as a means for earning value is limited and counter-productive.

 

A common cause for the degradation of the plan and the schedule is the way that field changes are managed. The Change Management section discusses the way that TeamWork 2k handles this issue.

 

As you have seen, it is important to have a good, detailed plan. However, at the front-end of a project, while the pieces of information regarding the content of the project are coming together, how is it possible to have a good plan? This leads to the issue of scope definition and management.

 

Managing the Project's Scope – Ensuring a Great Plan

As the project's evolves, drawings are issued for construction (IFC). These drawings help to provide the scope of work in capital projects. Inn turnaround projects, the lists of assets, that operations provides, provides the basis of the scope of work. The project manager and the project staff keep track of the scope items by creating work packages for each. These work packages are later used by the planner to provide the detail for scheduling.

A project's scope is 'frozen' at a certain date prior to the beginning of the construction phase. Following this point, additional scope changes are automatically tracked as changed scope. This allows project management to track changes and report on the effect of these changes to the scope of the project. In addition to knowing which items constitute changed scope, it is necessary to get these changes approved on a regular basis. A change management system includes the ability to tag one or more changes with a change number or ID. Each change makes a trip from the scope definition, to the planner, for planning and estimating, to the PM for approval. All changes that have a cost impact must be approved by a person in the project (or company) with the appropriate signing authority for the dollar amount f the change. In order for the PM to have an accurate idea of the impact of the change on the project, the change authorization request must include along with the cost impact, an indication of the impact on the overall schedule of the project.

It is important that the current scope of the project is always accurately stated in the plan and the schedule. This requires every member of the project team, especially the front-line supervisors and foremen to ensure that every work item that they work on is accurately included in the plan.

 

This leads us to discuss the Execution phase of the work, as this is where the whole project finally comes together: the engineering, scope development, planning, scheduling, targeting, cost tracking, etc.

 

Executing the Plan – where the rubber meets the road

The field is the 'work face'. It is where work is done according to the plan and the schedule. The people in the field are critical players in communicating all aspects of the work being done. They can be the source of disconcerting news too. Such as: the plan is not a good one. Or: the schedule is unworkable. Or: materials are not available. The field is where people have to get the job done (safely!), no matter what. So, it is critical that field people, including their potentially 'bad' feedback about the plan, are an integral part of the progress tracking process. The foreman's crew is working on the job every day.

• Who else could possibly provide insights into the progress of the work and the potential problems that are ahead? This information leads directly to the accurate determination of earned value.
  
• The foreman is the logical person to report on any additional scope items as well as their magnitude. This affects scope change tracking, thus ensuring that an accurate baseline is maintained.
  
• The foreman is also the logical person to accurately report on what his/her crew did that day. This information is also known as Incurred value (hours and costs).
  

 

Clearly, the most accurate sources of information during the execution phase are the field supervision people. They are the closest to the work. As they report all of their information on a daily (or shift) basis, it is important to track the progress of the project at the same rate. If you make it easy for them to enter their data into a single system (your system for progress tracking) then you have the best information as early as possible.

Another benefit of including your field supervision in the project at this level is that they plan their future work based on what the plan and the schedule have – which in turn makes them invested in ensuring that the plan is a sound one.

 

Now, that we have gone through the processes from progressing needs to scheduling, to planing, to scope management, through to execution, we are now ready to discuss the report that we will use to report this progress – Progress Reporting.

 

Reporting the Progress – what's the Good news?

We'll keep it simple . . . the big two items are time and money. We mentioned the S-Curve before. This curve plots cumulative hours or dollars on the y-axis against time in weeks or months on the x-axis.

 

The target s-curve is what we are shooting for. It is also known as the baseline. As we have already discussed, the planned scope changes. Therefore, the baseline changes. So we need to maintain a fresh baseline that reports to management the current effects of the latest changes. In order to see the transition over time, from the original baseline to the current baseline, it will be necessary to maintain a history of each baseline. Baseline management is discussed later.

In addition to the baseline s-curve, which stretch from the beginning of the project (0% Progress) to the end of the project (100% progress), two additional curves are normally plotted: Earned and Incurred. Earned human hours or earned costs (we'll refer to these as earned value) are the hours or costs that were estimated, and that are now in the baseline, for the current amount of progress. If the earned value exceeds the baseline value from the baseline curve, the project is ahead of schedule. The Incurred value curve is a plot of the labor, equipment, materials and other costs that have been incurred to-date. This is the cost incurred in obtaining the current earned value. If the earned value exceeds the incurred value your project is under budget, as you are making more progress for less cost.

It should be obvious here that an accurate system needs to exist for both:

• the determination of progress and how it gets converted into earned value, as well as
  
• the collection on incurred costs in a timely and accurate manner
  

 

These issues are tackled in the next two sections.

 

Earned Value Determination

in order to accurately obtain earned value, we depend on the work of the planner(s) that provided the initial estimates for human hours, equipment, materials and contracted costs associated with the work. Also, the foreman (foremen) in charge of executing the work need to provide an accurate accounting of the work being done (including new work that was previously not identified), and the remaining quantity of either duration hours or a logical physical unit (such as lineal feet of a pipeline).

The ratio of the remaining quantity to the original quantity provides a measure of the percent complete of the work item:

 

Percent Complete = 100 x (1-Remaining Quantity/Original Quantity)

 

The percent complete multiplied by the work item's value (hours and/or cost) provides the earned value of the work item.

 

In order to ensure that a trend of the earned value over time is obtained, it is necessary to record the daily value for quantity remaining for each task on each work item. This is routinely done by the field staff.

 

Collecting Incurred Value

The cost that your contractor bills you, for today's work, is the incurred value of today's work for that contractor. You have incurred that cost. It is not yet on an invoice or even in the mail. It should be in your system within 12 hours of being incurred. If the foreman enters his/her crew's time into your system directly and if the timekeeper validates that time and adds other costs at the end of the shift, this target is easily met. This means that you can compare your earned vs. incurred (also known as earned vs. burned) each day. A trend of this ratio is your productivity curve and helps the PM to decide whether the project needs corrective action. In order to provide a way to truly compare earned value with incurred value, these costs must be collected at the same level that the planner planned the plan. That's right. The hard work that the planner does continues to provide payback to the project deep in the execution phase. What if a work item that is needed by the field is not available in the plan and the schedule? The timekeeping system must allow the field people to add the missing work item 'on the fly'. They must feel that their timekeeping is accurate and that they have a stake in accurate data collection. In fact, the reports that are produced will validate their work automatically – further saving a huge amount of field effort in the area of report preparation of weekly and monthly reports.

 

OK, so, now we have our graphs, how about answering the first 2 questions?

• When will you be done?
  
• What's it going to cost me?
  

 

This leads us to forecasting.

 

Forecasting Cost and Schedule – where are we?

We mentioned two indexes previously, the CPI and SPI: These are computed as follows

• Cost Performance Index, CPI = Earned Value / Incurred Value
  
• Schedule Performance Index, SPI = Earned Value / Baseline Value
  

 

These two indexes can be used to compute a forecast cost at completion, based on the CPI and a forecast date of completion, based on the SPI.

 

As with any computed value, the numbers obtained are heavily dependent on all of the numbers that lead to these – careful attention to each of the detailed data elements leads to a higher confidence factor in the computed forecast costs and dates. That has been the objective of this document – to focus on the elements that deliver the desired results. Formula for forecasting cost and dates are:

 

Forecast Cost at Completion = Incurred Cost + (Remaining Baseline Cost / CPI)

Forecast Completion Date = Data Date + (Baseline Duration Remaining / SPI)

 

Note that your company's business rules for these computations may be different and the system that you use should be able to reflect your business rules.

 

Before we get too comfortable with our work we need to tie up some loose ends. Remember the Expended costs and the Committed Costs? Where do they now fit in?

 

How much have we spent? How much is left? The reason for the Budget

We know that we can easily track the amount that we have spent. This number is the sum of the credit card receipts, the invoices received, the checks written. This is called the Expended Cost. Assuming that the expended costs are the only extent of costs on the project is not facing reality. Project Controls is about peering ahead to determine what costs the project can expect. Each of the contracts, with contractors and vendors, represents a commitment that your project has to spend a certain amount of money. As this commitment does not, yet, show in the expended costs, it is easy to assume that you are not, yet, 'on the hook' for the contracted costs. This would be a mistake. Committed cost is a critical element of the cost story for the project. If committed cost exceeds expended costs, you need to turn your focus towards committed costs as the potential budget-breaker costs in the project. Once the project has started, it starts incurring costs. Incurred cost is the term that we use to define the costs that the project has incurred. An example helps to explain the difference between incurred costs and expended costs. Your contractor had 1000 people on your job site today. You just incurred a cost (of 1000 people x10 hours x $50 =) $500,000, that is not on any invoice or bill - yet! So, incurred cost is an approach to tracking your costs at the source and at the time of their being incurred. This, in turn, ensures that there will be no surprises – you should know your incurred costs on a daily basis. In order to know if any of these costs, expended, committed or Incurred exceeds the amount that you planned to spend, also known as the Budgeted Cost, you should be paying close attention to the project's progress. In order to create a realistic budget, you must first estimate the costs associated with the project. The estimating process is discussed in the Estimating the work.

 

Estimating the Costs – getting ready to create a Budget

Long before the planner gets involved, when the engineering drawings are at 30% complete, the estimating process provides a means for obtain a project budget. This estimating process is typically done for capital projects. It involves a materials take-off from the drawings. The materials quantities are multiplied with man-hour rates for installation. The man hours that are obtained in this way are then multiplied by current labor rates to obtain labor costs. These labor costs are added to estimated materials, equipment and sub-contracted costs to obtain the estimated cost for the project. Contingency costs due to unknowns, fees and other costs are included with the estimate to help ensure that a reasonable cost is obtained.

As the project's schedule is nowhere near being formulated, the budgeted amount is 'time-lined' manually using a cash-flow tool.

Appropriate company and/or project managers will approve the budget that is obtained in this manner.

Once the appropriate approvals are obtained, the project continues to progress from the engineering through the procurement towards the construction phase. This project cycle is commonly referred to as the EPC cycle. Managing the project means managing each of these cycles separately and together in the project or work management tool.

 

Project Baseline – What are we comparing our progress to?

A human hour project baseline is available for the planned and scheduled expenditure of human hours over the life of the project. In addition, a cost baseline is available for the planned and scheduled expenditure of costs over the duration of the project. As work scope is added to or removed from the plan, it may be necessary to re-baseline the project. In this situation, the TeamWork 2k's Re-baseline process provides the means to create the new baseline based on a 'pure' schedule – one with no progress. Some project managers prefer to see multiple baselines on their charts. TeamWork 2k maintains a history of each baseline in its snapshot area. The maximum number of human hours in the baseline is the Target Human Hours. The maximum cost that the baseline reaches is the Target Cost.

So, now we have baselines and targets and we are ready to see how we measure up against these.

 

Summary of Progress Measurement and Management

Bottom line . . . the process is certainly not hard. What is hard is trying to do all of the work in ONE system. The benefits of doing so are many, including less data manipulation and handling leading to less redundant data handling, which leads to more accuracy.

 

You will have now done away with the need for summarizing their progress, changes and incurred costs on a weekly or monthly basis. You have now evolved to a project management approach that is integral to the project – rather than one that is separate from it, as are most systems are today. Excel spreadsheets cost data, Primavera schedules with scheduled activities, Access databases with time data, Powerpoint presentations with management reports. This is the norm for project reporting today. And this is a very expensive way to do business. That would be OK - except that it is also extremely disconnected and thus prone to inaccuracies that are due to the redundant handling of data.

 

Another huge benefit is that the project team has a better quality of work – they do not need to spend countless hours manipulating spreadsheets, databases, presentations, schedules, etc. Management has 24x7 access to project data and is not dependent on field teams working overnight several days in a row to produce that monthly report. And the reports have no surprises – that is the nature of a well-used and widely-used system.

 

Talk to us at The TeamWork Group, Inc. We have the people, the tools and the know-how that can help your company take the management of projects to the next level.