pdri webinar slides
TRANSCRIPT
WEBINAR
Achieve Capital Project Success
with Effective Front End Planning
June, 2015
Today’s Presenter
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Sara DeanFounder & Principal Consultant
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We implement front end
planning solutions that
dramatically improve
performance in capital
projects.
Webinar Objectives
• Relationship between front end planning and project
performance
• Introduction to the Project Definition Rating Index
(PDRI)
• How can you take advantage of PDRI in your
organisation?
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How does improved scope definition
deliver increased project performance?
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What is the leading cause of
capital project cost and
schedule overruns?
Poor scope definition
Front End Planning
Achieving sufficient scope definition to address risk and make a decision on committing resources to maximise the potential for project success.
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Simply, Front End Planning Is
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Front end
planning
Right project
Right product
Right way
Scope Definition:
Documenting the scope of work into an organised plan
Reasons for Poor Scope Definition
1. Pressure to get product to market faster
2. Restricting key resource involvement
3. Lack of in-house design/planning
capability
4. Overly optimistic leadership
5. Financial pressure to minimise planning
costs
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The Question
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If we had done a better job of scope definition, would we have improved
the performance of the project?
Cost-Influence Diagram
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Critical Success Factors
Defined front end planning process
Scope definition tools
Existing conditions definition
Contracting strategy
Alignment
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How do we put this into practice?
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Project Definition Rating Index
A methodology to measure the
level of scope definition
– Comprehensive review
– Identify gaps
– Take appropriate action
– Reduce risk in front end planning
Origin of PDRI
• Consortium of 140+ member companies
– Owners, engineering/contractors, suppliers
– Public & private sector
• Renowned for developing capital project
best practices
• One of the most successful is the
Project Definition Rating Index (PDRI)
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PDRI in Action
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Why is PDRI Critical?
• Improves capital project performance
– Benchmarked on over $96B in projects
• Increases stakeholder alignment
• Provides transparency on risk
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Cost savings of 6 – 25%
Schedule reductions of 6 – 17%
Application of PDRI
1 2 3
Early
Review
2i
Final
Review
Project Templates
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Infrastructure
Projects
Building
Projects
Industrial
Projects
• Greenfield & brownfield projects
• Small (less than $10M), large & mega projects
Structure of PDRI - Industrial
Basis of Project
Decision50%Basis of Design
42%
Execution
Approach8%
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Manufacturing Objectives
Business Objectives
Basic Data R&D
Project Scope
Value Engineering
Site Information
Process/Mechanical
Equipment Scope
Civil, Structural & Architectural
Infrastructure
Instrument & Electrical
Procurement Strategy
Deliverables
Project Controls
Project Execution Plan
Recommended Participants
• PDRI Facilitator
• Project sponsor
• Project manager
• Engineering design reps
• Key discipline leads
• Maintenance & Operations reps
• Procurement
• Project controls (cost, schedule and risk)
• Regulatory
• Environmental
• Construction manager
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Target Scores
PDRI 1 PDRI 2 PDRI 2i PDRI 3
Feasibility Concept Detailed Scope
(intermediate)
Detailed Scope
550 – 800 450 – 600 300 – 450 150 - 250
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Evolution of PDRI
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PDRI Spreadsheet
Paper Checklist
Carve for PDRI
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for Projects
Maximise the value of PDRI
for all project stakeholders
for Portfolios
Effective risk management
in front end planning
Implement a repeatable PDRI process
for PDRI
Fit-for-purpose Project Templates
Configuration makes project templates
fit-for-purpose to your organisation
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Business
units
Polices &
procedures
Gate
deliverables
Regulatory
requirements
Industry
terminology
Language
translation
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Project Template Configuration
Impact on Front End Planning
• PDRI is a proven methodology to improve scope
definition
– Improves project performance (cost, schedule, change
orders)
– Increases stakeholder alignment
– Transparency on risk
• Incorporates ALL of the critical success factors including
– Assessment of existing conditions
– Contracting strategy
• Supports continuous improvement in front end planning
26for PDRI
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Where do we start?
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120-day roadmap to
success with PDRI
Evaluate PDRI
Try it on a cross-section of projects
Initiate using a structured proof of concept
Achieve a visible success story
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Preparing
Initiating
Growing
Establishing
Benchmark
NeedsAnalysis
Evaluate change areas
Introduction of practice in a
proof of concept
Expansion of practice beyond
proof of concept
Marketing new process to
broad organisation
Initiating use of PDRI
Success Story120-day roadmap
Case Study – Major North American City
CONFIDENTIAL 30
Objective
• Demonstrate applicability of PDRI to
front end planning for the City’s major
capital projects
Scope
• Conduct multiple PDRI sessions
• Building & industrial
• Early review & final review
Success Criteria
• Deliver immediate value to each project
• Identify elements posing the greatest
risk to the overall capital program
Benefits of the 120-day Program
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Success StoryShowcase results and acquire
support for expansion of the practice
EducationPurpose-built training for all
impacted stakeholder groups
Immediate Project ResultsBetter scope definitionCost & schedule certainty
Team Alignment
Implementation RoadmapProven strategy to implement
change in process
A repeatable process based on best practices
Summary
• The level of scope definition is the greatest driver of cost and
schedule certainty
• Project outcomes is most easily influenced in front end
planning
• Project Definition Rating Index (PDRI) methodology
• The most successful open industry standard to improve scope definition
• Start realising the benefits of improved scope definition today
• Engage the support of Valency - PDRI implementation specialists
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How does improved scope definition
deliver increased project performance?
