IPA-Webinar-Coping-With-Resource-Limitations-on-Capital-Projects.pdf
Transcript of IPA-Webinar-Coping-With-Resource-Limitations-on-Capital-Projects.pdf
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IPA Webinar: Coping with Resource
Limitations on Capital Projects
Lucas Milrod
Research Team Leader, Organizations and Teams
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2 INDEPENDENT PROJECT ANALYSIS
Outline
• Introduction to the Problem
• How to Cope with Resource Limitations
• How to Improve Long-Term Outlook
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3 INDEPENDENT PROJECT ANALYSIS
• Everyone agrees that they do not have all of the people resources they need
• True of capital project teams - 75% do not have adequate resources
‒ Missing critical owner functions
‒ Inexperienced leaders
‒ Understaffed
• Demographics suggest the problem is here to stay
The Problem – Not Enough of the Right People
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4 INDEPENDENT PROJECT ANALYSIS
World Population is Nearing Retirement Age at Increasing Rate
0
5
10
15
20
25
30
1980 1990 2000 2010 2020 2030 2040 2050 2060
World population aging 2013. 2013. United Nations, Department of Economic and Social Affairs, Population
Division.
% o
f W
orld
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tion
60 Y
ears
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er
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5 INDEPENDENT PROJECT ANALYSIS
What Is a Project?
Something you build on a budget and schedule?
Budget Schedule
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6 INDEPENDENT PROJECT ANALYSIS
A Project Is the Flow of Information
FEL 2 and FEL 3
Detailed Engineering
Startup
Construction
Authorization
Just one-third of the life cycle is typically spent building anything
About two-thirds of the project cycle is spent producing, using, and moving information from one information producer/consumer to another
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7 INDEPENDENT PROJECT ANALYSIS
• Information is at the core of capital projects:
‒ Accurate and timely production
‒ Smooth flow
‒ Correct use
• People are information consumers/producers
• Teams are units of people working in concert
Building Something Physical Is the Result of a Complex Information Production Process
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8 INDEPENDENT PROJECT ANALYSIS
Without Adequate Staff Capital Project Teams Struggle (1)
25% WORSE COST COMPETITIVENESS
22% WORSE COST GROWTH
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9 INDEPENDENT PROJECT ANALYSIS
Without Adequate Staff Capital Project Teams Struggle (2)
5% MORE SCHEDULE SLIP
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10 INDEPENDENT PROJECT ANALYSIS
Outline
• Introduction to the Problem
• How to Cope with Resource Limitations
• How to Improve Long-Term Outlook
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11 INDEPENDENT PROJECT ANALYSIS
• Get the right skills and abilities on the team
• Form the team early
• Organize the team to cope with limitations
• Retain institutional knowledge
Basic Approaches to Coping withResource Limitations
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12 INDEPENDENT PROJECT ANALYSIS
• When faced with resource limitations
‒ The team members that are there must be the right fit
‒ Key positions on the team must be filled
• Business must be involved to ensure the right people are on the team
‒ When business sponsors are involved in a project, the team is twice as likely to have owner personnel in critical functions
Get The Right People In Critical Functions
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13 INDEPENDENT PROJECT ANALYSIS
Types of Project System Organization
Full FunctionalControl
Weak Matrix
(Function-Centered Matrix)
Strong Matrix
(Project-Centered Matrix)
Pure ProjectControl
Most project systems tend to fall in the middle
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14 INDEPENDENT PROJECT ANALYSIS
• Project team organization often reflects the organization of the project system
• Teams that cope with resource limitations best reflect a project-centered matrix
• Function-centered systems are more complex and team integration is difficult
• Project-centered systems simplify the flow of information
Project Team Organization In Resource-Limited Environments
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15 INDEPENDENT PROJECT ANALYSIS
• Forming the team during FEL 2 offsets some negative consequences of resource limitations
‒ Team that experience resource challenges, but are formed early, achieve significantly better definition
• Teams that are formed early have a head start in the planning process
Resource Limited Teams That Are Formed Early Achieve Success in Definition
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16 INDEPENDENT PROJECT ANALYSIS
• Use retirees to fill short-term gaps in the project team
‒ Set-up to mentor others
• Establish and maintain long-term relationships with contractors
‒ Promote the retention of organizational knowledge (i.e., standards, processes, etc.)
• Develop and support inexperienced personnel through mentorship and communities of practice
Leveraging Knowledge Allows Teams to Get the Most Out of What They Have
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17 INDEPENDENT PROJECT ANALYSIS
Outline
• Introduction to the Problem
• How to Cope with Resource Limitations
• How to Improve Long-Term Outlook
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18 INDEPENDENT PROJECT ANALYSIS
• Thoroughly define each function or functional group involved in capital project execution
‒ Responsibilities, duties, knowledge, skills, abilities, scope of management
‒ How does the role change across project types, sizes, locations, etc.?
‒ What does success in the function look like?
Step 1: Define and Understand Core Capital Project Functions
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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19 INDEPENDENT PROJECT ANALYSIS
Step 2: Assess Current State of Project Resources
• Leverage job definitions to determine competence of existing resources–where do current employees fit when compared to definitions?
– Development and application of formal tools and/or assessments of personnel based on identified position criteria
– Survey of past work and performance and compare against responsibilities and scope of management outlined for each position
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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20 INDEPENDENT PROJECT ANALYSIS
Step 3: Assess Immediate Project Management Resource Needs
• Conduct workforce assessment based on corporate strategy and target portfolio
• Identify the type and level of necessary resources based on the amount of immediate project work and the specific characteristics of the work
– Identify the competencies required to achieve immediate objectives
– Determine the right mix of project personnel necessary to address the competency requirements
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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21 INDEPENDENT PROJECT ANALYSIS
Step 4: Identify Gaps in the Current State and Immediate Needs
• Compare the current state and immediate needs of the project management resource to identify gaps
• Probable gaps include:
– Competency gaps in existing resources
– Need for additional resources at specific positions and competence levels
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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22 INDEPENDENT PROJECT ANALYSIS
Step 5: Develop a Short-Term Action Plan (1)
• Use the report to develop solutions to bridge the identified short-term gaps
– Competency gaps in existing resources: Create individual development plans to foster the development of competence in targeted areas
Internal/external training, developmental work assignments, certification attainment, etc.
– Need for additional resources: Develop internal and external recruitment and selection standards, tools based on job definitions
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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23 INDEPENDENT PROJECT ANALYSIS
Step 6: Assess Long-Term Project Management Resource Needs
• Conduct workforce planning based on long-term corporate strategy and target portfolio
– Forecast the long-term workforce requirements based on planned project work and/or capital expenditure
• Identify any risks to the development of key functions over time
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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24 INDEPENDENT PROJECT ANALYSIS
Step 7: Develop a Long-Term Action Plan
• Establish the support necessary to address the identified resourcing needs and risks, and to set your company up for long-term strategic management of key project functions
• Efforts may include:
– Staffing plans and contingencies
– More sophisticated recruitment and selection tools
– Establishment of functions and career path, linked to development plans
– Compensation strategy
– Performance Management System
– High Potential program
Ste
p 1 Define
Core Functions S
tep
2 Assess Current State S
tep
3 Assess Immediate Needs S
tep
4 Identify Immediate Gaps S
tep
5 Short-Term Action Plan
Ste
p 6 Identify
Long-Term Needs S
tep
7 Long-Term Action Plan
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25 INDEPENDENT PROJECT ANALYSIS
Goals for Improvement
• Identify the amount and type of people required to meet project/portfolio requirements
• Match the competency proficiency of resources with the competency requirements of projects
• Hire internally and externally in a manner that targets specific needs
• Develop people in a way that cultivates the needed competencies as people retire or leave and projects become more difficult
• Measure and manage performance against a solid standard
• Engage and retain the best people
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26 INDEPENDENT PROJECT ANALYSIS
IPA’s Organizations and Teams Work
Lucas Milrod
+1 703.726.5493
• Research that covers:
‒ Project organizations
‒ Organizational design
‒ Project team staffing and structure
‒ Functional competency
• Assessments / Products:
‒ Organizational Effectiveness (Site and System)
‒ TeamOp
‒ Team and Site Functionality