Element 1: Scenario-based Project Planning

Tactical Plan

Working Team | Vision | Problem | Benefits and Opportunities | Barriers & Challenges | Goals | Strategy | Focus Areas & Projects | Timeline | Case Studies | 2007 Executive Summary

Scope

Provides a comprehensive, collaborative project planning system that captures and analyzes front end data (including business case, scientific data, what-if scenarios, requirements and conceptual design, customer needs, budget and scheduling, and feedback from operations and maintenance) to assist the planning team as well as to provide the initial data capture to be used throughout the lifecycle of the facility.

Working Team

CH2M HILL, Andrew Phillip
The Dow Chemical Company, Sylvia Rappenecker and Matt Morrison
DuPont, Richard Lopez
Fluor, Gary Chanko
Primavera, Nicole Styer (Team Co-Champion)
Primavera, Richard Sappe (Team Champion)
State of Wisconsin, Bill Napier (Team Co-Champion)
University of Delaware, Nate Cloud
Portland State University, Christopher Garlick

Vision

The Vision statement describes what is wanted in the future.

The future project planning system will provide interactive evaluation of project alternatives, enabling creation of conceptual designs and project plans that best meet the needs of all stakeholders. This collaborative planning environment will provide full awareness of the impacts of decisions on costs, schedules, and lifecycle performance. The system will provide the initial input to a comprehensive project plan and specifications, ultimately captured in an Asset Lifecycle Information System, to guide subsequent project designs and support downstream project functions. The Asset Lifecycle Information System is a foundation of the future state vision, serving as the repository for all design and planning information and the interface for all systems and applications.

Work Processes

Project teams will interact with customers and other stakeholders to review various options and to develop and refine a set of project requirements and plans. Options will be evaluated using a rich suite of integrated modeling and simulation (M&S) tools that enable rapid real-time exploration of different scenarios to arrive at optimum decisions both within the context of a project, and within the context of a facility lifecycle. Project decisions will provide the conceptual basis for the detailed design. Scenarios can be re-evaluated at project milestones or at critical decision junctures to validate and/or modify the planning for subsequent project phases.

The project planning team will interface with the design team to iterate conceptual designs, using modeling and simulation tools that permit planners and stakeholders to view and concur on such project areas as functionality, aesthetics, layouts, flow sheets, and construction strategies.

Technology Enablers

The M&S tools are a suite of powerful assessment and planning tools, linked to the Asset Lifecycle Information System and to external information sources that will enable project teams to quickly capture, iterate, and determine optimum solutions based on accurate and complete data.

The M&S tools will enable financial risk assessment as well as consideration of options related to the capital facility, such as what to build, where to build and how to build. Various scenarios can be evaluated assessing the impact of risk and business factors such as 1) site selection, 2) technology selection, 3) current and future capacity needs, and 4) facilities operation and maintenance strategies. Although the project planning system will not model scenarios involving "pure" business decisions (e.g., market assessments of business needs and trends, determination of market share, venture modeling, own versus buy decisions, etc.), the model will illuminate the cost and schedule impact of alternative project execution strategies and decisions.

The planning environment will encompass conceptual designs for review and selection, requirements, objectives, technical and business issues, and analysis of options. Captured knowledge from previous projects and links to business systems will determine availability and prevailing pricing of labor, materials, and equipment. This will provide accurate cost and schedule estimates to support project financial decisions and facilitate authorization to proceed to the design phase. These inputs will include accurate market forecasts and full knowledge of regulatory, technical, demographic, and other factors.

The suite of M&S tools, at some point, will be even more integrated will also interface with external databases to capture regulatory requirements, codes and standards and to correlate them to the design requirements. It will automatically generate an initial work breakdown structure and other key elements of the project management toolset to provide a framework for costing, scheduling, and workflow tasking.

Model-based risk assessment tools will enable planners to explore physical and financial risk scenarios to make informed decisions that balance cost drivers against risk factors.

Current Problem

The Current Problem statement describes the existing situation.

There have been many technology advances in engineering design, construction, and facility operations; however, project planning has remained a very intuitive process with little technology automation. Project planning is carried out by project engineers who may or may not have the experience needed to understand all of the project variables and their complex inter-relationships. Many times, project requirements must be extracted from business teams by project team members who may not know the right questions to ask and are unable to analyze and identify project alternatives to meet the requirements. There is little or no automated scenario modeling and simulation capability available to the decision makers, leading to sub-optimized project plans. Many projects follow a tight timeline forcing inexperienced team members to make "seat-of-the-pants" decisions with little or no data. Many senior project professionals have experience-based rules-of-thumb that are not well documented or readily accessible by others. Some of the variables addressed in the decision-making process are unique to specific projects, may need to be weighted differently, and may have over-riding or dominating factors.

Future project success is dependent on early identification of all the risk factors and development of suitable contingency plans. There are currently available no expert systems capable of capturing current project successes and failures and translating that knowledge into improved project strategies.

Potential Benefits & Opportunities

The benefits of scenario-based project planning (SbPP) start with a more comprehensive understanding of the issues and key risks of the potential project and development of alignment among the project team and business leaders as a result of the work done during the planning phase. This results in better decision-making and enables elimination of costly errors up-front, agreement among all stakeholders, compression of the timeline from requirements to full design specifications, and the ability to explore numerous options quickly, prior to selecting a project execution strategy. These features will result in better, safer, more secure facilities delivered faster and at less cost. Specific benefits to the stakeholders are cited in Table 1 below.

Potential Barriers & Challenges

Scenario-based project planning involves the iteration of many variables with complex relationships. Modeling these relationships will be difficult because the importance of individual variables will be unique to specific projects and will vary across projects.

One of the challenges in scenario based project planning is to be able to understand and incorporate complex interrelationships of variables to achieve the best decision in alignment with values and strategies such as sustainable development. As stated by the International Institute for Sustainable Development, related to business strategies "the aim is to seek win-win situations which can achieve environmental quality, increase wealth, and enhance competitive advantage... In the pursuit of economic, environmental and community benefits, management considers the long-term interests and needs of the stakeholders." One goal of scenario based project planning is to enable stakeholders to maximize the "win-win situations" that will enhance the sustainability of projects and the surrounding community.

Variables to consider in scenario-based project planning include the following (recognizing that weighting factors and level of importance for each variable will depend on specific business needs of each project):

A. Site selection

1. Market location
2. Raw material sources
3. Logistics availability - Incoming & outbound
4. Political & social climate
5. Environmental impact - water effluent, air emissions, social factors
6. Personnel hazards - explosion potential, toxic releases
7. Tax incentives
8. Governmental permitting - national & local, building, sewers, highways, railroads, navigation, navigable waters, aircraft, environmental
9. Staffing - labor pool, skill level
10. Site soils, groundwater, and geology
11. Infrastructure - available services - electrical power, telephone, water, railroad, highways
12. Cost of services - energy costs, construction & operating labor

B. Facility Technology

1. Is the technology state-of-the-art?
2. Is it competitive - World class manufacturing
3. Alternatives - waste treatment and disposal requirements, energy consumption

C. Project Strategy

1. Front end loading
2. Production design
3. Construction - stick built versus modular construction
4. Contracting - Lump-sum, cost-plus-percentage-of-cost, incentive?
5. Project information strategy (collaboration, work flow, document management)

D. Sourcing/Procurement

1. Engineered equipment
2. Field material
3. Field labor
4. Raw materials
5. Domestic versus import requirements
6. Contract services

E. Schedule

1. Start up timing
2. Rate of capacity attainment

F. Project Budget

1. Capital and non-cap
2. Cash flow requirements/limits

G. Risk assessment and Contingency Planning/Exit Strategy

1. Process / Structure Technology
2. Logistics - how to transport product?
3. Economic risk (project economics, market assumptions still true)
4. Environmental risk
5. Contractual risk

H. Information Asset

1. Content requirements for information handoff
2. Format requirements for information handoff (documents, databases, paper, etc.)
3. Timing and availability of the information deliverable (during, after)

I. Business requirement flexibility

1. Capacity flexibility
2. Product flexibility
3. Quality flexibility

Goals

The Goal statement describes what is expected to be achieved.

From a technological standpoint, the goal is to achieve a fully automated project planning and conceptual design environment. From an operational viewpoint, the goal is to provide a level of automation and human interaction that best serves all the stakeholders by providing the ability to review project planning options and scenarios quickly and interactively, resulting in the highest value business-based project plan.

All of the data and information generated in this phase of the project is part of an Asset Lifecycle Information System (described in Element #9 - Lifecycle Data Management and Information Integration). This system is the interface for all project operations, applications, and information flows and must be maintained and validated throughout the lifecycle of the project.

Strategy for Achieving the Goal

The strategy statement describes how we see the goal being achieved.

Our strategy addresses the key steps needed in order to realize the vision of a fully integrated and automated project planning process for capital projects. We believe execution of scenario based planning includes three very high-level phases: Define Requirements, Evaluate Alternatives, and Make Decisions. The strategy includes the following components:
1.  Identify and document the SBPP process by which project planning decisions are made, and the broad information inputs and outputs required to support those decisions. Develop clear, prioritized requirements to support the other Roadmap elements.
2.  Develop Technical Framework: Based upon performance goals, propose, get agreement on and adopt a Technical Framework and its components, together with a step-wise, evolutionary plan of action.
3.  Research and Document Resources: Communicate with the working groups of the other elements to revise the needs and priorities for the industry-wide Shared or Common Reference Data, and support the population of such knowledge-bases. Assemble a list of the existing resources (tools and work processes) that are widely used in the industry today. Assess degree of utilization and applicability of these resources in achieving the vision.
4.  Identify existing and emerging tools and technology platforms for modeling / simulating scenario-based project plans. Evaluate both existing resources and emerging tools and technologies, and develop specifications for technologies and tools that must be developed to fulfill the requirements of scenario-based project planning.
5.  Develop Tool: Work with suppliers as needed to develop the final framework / tool for SbPP and as a front-end for the rest of the roadmap.
6.  Provide support to organizations that wish to deploy an Asset Lifecycle Information System. (Note that this support might extend to the point where it fulfils some sort of Compliance Certification role.)
Focus areas and Projects are defined to execute this strategy.

Focus Areas & Projects

The focus area section describes what we are going to focus on, and specific projects are proposed within each focus area.

Focus Areas are the broad description of what this Roadmap element is going to do. Each focus area will be addressed through several projects, conducted over time. The project titles are linked to the detailed project descriptions.

Project details can be viewed by downloading the PDF. The project template applied to each project includes: Project Title, Objectives / Deliverables (what result), Purpose / Business Driver(s) (why), Ties / Dependencies / Overlaps (with other projects or Elements) (constraints, boundaries), Urgency / Time line (when), Process / Activities (how), and Resources (who). Each project will be more fully defined as time progresses. At this point the project descriptions should indicate what the project will do in sufficient detail to get potential participants interested and to understand the timing and dependencies between projects. Timing or scheduling of these projects is presented in the section, the Seven-year Timeline. Many of these projects in Roadmap Element 9 may need to be conducted concurrently, as sub-projects of one larger project.

E1-FA1: Work Process Mapping - Identify and document the SBPP process by which project planning decisions are made, and the broad information inputs and outputs required to support those decisions.

Projects:

E1-FA1-P1 Map the Decision Process

Status:  Complete.  Please login to the members only website to view:

• Phase 0 - Initial Work of the Team
• Phase 0 - SbPP Timeline and influence diagram
• Phase 0 - Supplier Evaluation Process – 11/10/05

E1-FA2: Industry Tool Survey - Using the SbPP Work Process Map, identify the Reference Data and Tools available in the industry today to support the SbPP process.
Status:  Complete.  Please login to the members only website to view:

• Phase 1 - Functional requirements – 12/14/05
• Phase 1 - Supplier Contact and Information Sheet – 1/2/06
• Phase 1 - Supplier Interview Schedule – 2/2/06
• Phase 1 - Summary of the Seven Supplier’s Response
• Phase 2 – Vendor Instructions for Proposal – 3/13/06
• Phase 2 – Acceptance Letter to Vendors
• Phase 2 – Rejection Letter to Vendors
• Phase 2 - Case Study
• Phase 2 – Final 3 Supplier’s self evaluation
• Phase 2 – Summary of SbPP Team Evaluation
• Phase 2 - Expert Choice® Webinar Charts
• Phase 2 - Palisades® Webinar Charts
• Phase 2 - September 2006 Members Meeting SbPP Presentation

Projects:
E1-FA2-P1 Product and Process Survey and Analysis\

E1-FA3: Reference Data Requirements - Identify and document the Reference Data requirements for delivering next-generation SbPP capability.
Status:  No work performed for this item.

Projects:
E1-FA3-P1 Industry Costing Reference Data
E1-FA3-P2 Lifecycle Cost Reference Data
E1-FA3-P3 Industry Schedule and Quality Reference Data
E1-FA3-P4 Reference Information Model

E1-FA4: Functional Requirements - Identify and document the functional requirements necessary to support input, output and analysis activities in the next-generation SbPP tools.
Status:  Preliminary functional requirements developed and used to conduct the supplier identification and analysis.  Please login to the members only website to view material.

Projects:
E1-FA4-P1 Develop Working Agreements As Required
E1-FA4-P2 Functional Requirements for Project Risk Assessment
E1-FA4-P3 Functional Requirements for the User Interface
E1-FA4-P4 Functional Requirements for Modeling & Simulation
E1-FA4-P5 Define "Grouping" Functionality for Analysis and Output
E1-FA4-P6 Functional Requirements for Automated Scheduling and Facility Project Definition
E1-FA4-P7 Define Interfaces with Other Tools
E1-FA4-P8 Next-generation Product Specifications

E1-FA5: Data Model Requirements - Identify and document the data model requirements necessary to support the functional requirements identified in FA3, for the next-generation SBPP tools. Include definition of data exchange, validation, interfaces, for the data held in ALIS, and for any external Reference Data.

Projects:
E1-FA5-P1 Data Modeling - Integration with Existing Data Sources
E1-FA5-P2 Define the Data Model for SbPP Data in ALIS
E1-FA5-P3 Define the SBPP Reference Data Model
E1-FA5-P4 Create the Tools and Database Development Multi-Generation Plan

E1-FA6: Design & Develop Next Generation Tools and Database - Complete the application system design, and the database schema for the next-generation SBPP tools. Develop, test, and deliver the tools and reference database.

Projects:
E1-FA6-P1 Write Software Application(s) and Create and Populate Database(s)
E1-FA6-P2 Create and Populate the SbPP Reference Model
E1-FA6-P3 Beta Test the SbPP Reference Model and ALIS Using the SbPP Application
E1-FA6-P4 Implementation Plan

Seven-Year Timeline

A timeline is proposed for the projects within this tactical plan.

Assumptions used for the seven-year timeline shown below:

1. Preparation for each project will take about 3 months (1 quarter). Project preparation includes identifying funding, resourcing and set-up. Preparation time is included in the following timelines.
2. Project teams will form and disband for each project (unless the team wishes to continue to do another project).
3. The "X" is placed in the year of the most intensive work, although there may be opportunities to start some phases earlier or to run some projects in parallel for a while.

Case Studies

DuPont, one of the world's most diverse manufactures, applies a discipline called front-end loading (FEL) to maximize efficiencies in its capital projects. While this has nothing to do with moving dirt, it does have everything to do with assuring a solid foundation from inception for every project. First, a Business Objectives Letter is used to create alignment between business goals and project objectives. This describes the business objectives for the project, what the business expects of the project team, and the criteria/principles that the team will follow in developing the project. Gatekeeping Reviews at the end of each stage of FEL evaluate adherence to capital effectiveness best practices and business objectives. This is a prerequisite to going on to the next stage of the project, and gives the team an opportunity to review and gain buy-in with the project sponsors and business leaders. These discussions also enable all the stakeholders to interact to assure project success. Process Hazards Screening Reviews are held to identify potential acute hazards and concerns, and to recommend any broad scope changes that could significantly reduce the hazards. This step also determines if detailed hazards reviews are needed. The review includes assessment of occupational health and toxicity issues, initial hazards classifications per standards, and identification of critical components, equipment, and systems. - Contributed by Judith W. Passwaters, DuPont Company

The CII has created tools based on industry Best Practices that are excellent guides for project definition and planning including areas related to constructability. Other best practices focus on teambuilding and partnering. The PDRI - the Project Definition Rating Index for Building Projects - and the PDRI-I for Industrial Projects offer comprehensive checklists that support scope evaluation and identification of areas for improvement.

The Patriot missile system that first saw action in Desert Storm in the early '90s started life as a program called SAM-D in the 1960s - a staggering 30-year development span. Aggressive efforts by industry and government both changed the defense business model and leveraged new technologies to radically reduce time-to-market. The results have been amazing: the winning prototype of the new, radically advanced Joint Strike Fighter (JSF) aircraft started the design phase in 1998 and began first flights only 2 years later in a "same as production" configuration which will begin rolling off the assembly line in 2004-05.

The electronics industry has responded with the "fast turnaround fab" - a facility designed to produce for a limited time span, based on the most current technology, and then be changed out or decommissioned.

Bechtel is one of the world's largest engineering and construction firms, with over $14.5 billion in new business booked in FY 2000. Reductions in delivery time and plant construction costs are key factors in their success. To accomplish this, Bechtel initiated a process in the early 1990s of standardizing power plant designs. There are less than 10 standard designs, each of which includes a set of process drawings and physical models along with associated performance and cost data. These standard designs are stored electronically, enabling rapid modification and configuration to a specific customer requirement. This process significantly reduced the delivery time and cost of power plants over the past decade including Egypt's first privately owned power plant, Sidi Krir, completed within budget and ahead of schedule in December '01. - Thomas Ulrich, "Bringing Power to the People," Bechtel Briefs, April 2001. www.bechtel.com/pdf/brief0401.pdf

Lack of industry standards has long impeded management of the planning stages of capital projects. The National Institute of Standards and Technology (NIST) is the most visible champion for R&D that supports this need and is working towards product data standards and integrated information systems to enable more efficient project planning. A major thrust in this area is the Construction Integration and Automation Technology (CONSIAT) program, which is aimed at significantly reducing cycle time and life-cycle cost through integration and automation of project information.

Another notable NIST activity is PlantSTEP, being developed through a consortium of EPCOM companies and suppliers. The primary focus is to develop and implement data exchange standards based on ISO 10303. This effort is coordinated with related activities such as PIEBASE (Process Industries Executives for Achieving Business Advantage Using Standards for Data Exchange), a global organization for process industry consortia and companies.

The International Alliance for Interoperability (IAI) is developing Industry Foundation Classes (IFCs) as a basis for information sharing in engineering, construction, architecture, and facilities management. IFC project models define individual buildings for which compliant applications can exchange information accurately. Current activities include advances in XML standards to enable seamless flow of text-based information via the web; development of IFCs to support code compliance applications during design; and IFCs related to cost estimating and scheduling.

© 2007 FIATECH. All rights reserved