A Holistic Approach to Imperative, Systemic Change
The O&G industry is at an inflection point in capital project effectiveness. Only those who embrace transformative solutions to project planning and execution will survive to make future investments in capital projects.
Whether you are an operating asset owner or an EPC, your company is confronted with reinventing the core of its capital projects delivery, so that certainty of project outcomes and asset revenue goals are realized during asset life. Reliance on current industry-adopted work processes supported by document-centric, functional, independent data silos will perpetuate cost and schedule overruns.
Transformation, enabled through digital solutions, is critical to address issues related to current complexity, size and risk of major capital projects that has outgrown the ability of humans to effectively handle the sheer volumes of data required to build, operate and maintain assets. The transformation requires successfully planning and implementing solutions through a holistic change management process to achieve sustained, culturally intrinsic results.
Capital project owners, engineering, procurement, and construction contractors and supporting service organizations are searching for means to dramatically reduce the cost of capital projects. Owners/ Operators are driving change through contracting strategy, contract language, contract deliverables and performance metrics. In response, EPC companies are striving to attain productivity improvements by utilizing plant design, material management, and construction software and technology platforms.
Construction productivity has steadily declined over the past several decades. Leading causes of Non-Productive Time, typically 37% of 10-hour workday, include incomplete drawings; errors on drawings; missing materials; restricted access to the workface; scaffolding not in place and missing construction equipment or tools
The business case for change is quite simply a 25% improvement in field productivity that translates to up to 10% of Total Installed Cost (reference CII Publication 272).
Technology an Enabler, not a Solution
To realize the gain, fundamental change begins and ends with the behaviors of project leaders and project delivery organizations. Evidence of this “people” change is a culture shift that recognizes construction, as well as operations, as the customer of engineering design.
While software and technology platforms can enable this change, these are effective only to the extent that they are fit for purpose for the users and customers of the data. Such software enables more effective integrated and interactive planning. Project practitioners that exercise rigor in both planning and execution can use these tools to optimize, prioritize and re-sequence work as changes to the plan surface.
Project delivery organizations are inherently process-centric. Software and technology must be recognized as an enabler, not a panacea. When new technology platforms do not mirror existing work processes, the capture of productivity gains is delayed and diminished. Preparing software end users to see and accept how changes impact their daily work is essential to realizing a quicker return on investment. Some examples of areas that are challenged by the alignment of people, processes and tools are:
Transparency in the flow of design and materials data
Standardization of work processes, systems, and organizations across multiple locations or companies
Selection of systems that improve net overall value of essential EPC work processes
Rework due scope changes, errors, and design omissions
Communication gaps between home office engineering and the field
Work processes and systems enabling increased savings from facility modularization
Identifying changes in work processes and roles required resulting from deployment of a new technology platform
Transformational, systemic changes in project delivery organization culture, strategy, leadership, work processes and tools will require the collaboration of Owners, EPC contractors, and software and service providers to identify issues and seek improvement through Construction Driven Planning and Work Packaging in Focus Areas such as the following:
Martina Asbury is a Senior Project Advisor in the Capital Effectiveness Practice of Endeavor Management. She partners with clients to identify performance barriers to capital effectiveness and drive sustainable improvement by drawing on vast, practical “been there, done that” experience. She has coached project leaders to drive team integration in over 200 projects ranging from USD 100 Million to USD 25 Billion. Her strength lies in her ability to rapidly assess technical, interpersonal and work processes issues, and then engage leaders in solutions that reduce risk, conflict and communication breakdowns.