Procurement of Complex Tunneling Projects
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Transcript of Procurement of Complex Tunneling Projects
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Procuring Complex Tunnelling Projects – Considerations for Owners and Contractors
Steve TennantDirector Plus 3 Consultants
www.plus3.com.my
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What Am I going to Cover?
1. Updates in Project Management Theory2. Practicalities3. Business Cases and Honesty / Optimism4. Unmanageability and Uncertainty
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Project ManagementTechnical
Traditional Project ManagementSchedule Cost
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Project ManagementTechnical
Complex Project ManagementSchedule Cost
Context Financing
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Rethinking Project Management
1. Accounting for external factors instead of treating them as risks
2. Changing management from a linear process to an interactive process
3. Emphasizing project completion in terms of creating value, instead of focusing on end product
4. Thinking of the project on a broad spectrum with multiple purposes and no preset definition in lieu of a defined start and end point with guidelines
5. Focusing on the training of managers to rely on experience and intuition instead of merely following detailed proceduresRef. Rethinking Project Management (Winter and Smith 2006).
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Rethinking Project Management – Some
References• http://goo.gl/0VSFhg
International Centre for Complex Project Management• http://goo.gl/eS90qE
Rethinking Project Management -‐ Final Report• http://goo.gl/jxY57E
Transportation Research Board of the National Academies• http://goo.gl/hhX3Ws
New Paradigms for Complex Projects• http://goo.gl/0eGcyo
Management and control of Cost and Risk for Tunneling and Infrastructure Projects
• http://goo.gl/wsAoOU• Manageability of Complex Construction Engineering Projects: Dealing with
Uncertainty
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Enough of Theories, what about Practicalities?
The Project Owner whether Government or Private Sector, needs:• Credibility– Enabling Legislation / Concession– Financial– Technical– Project Management capability– Acceptable Commercial reputation
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Enough of Theories, what about Practicalities?
The Project whether Government or Private Sector, needs:• A Business Case
– Business Drivers or Need– Scope of Project– Financial Metrics– Assumptions– Cash Flow Statement (NPV)– Costs– Benefits (Social / Financial)– Risk– Strategic Options
– Opportunity Costs– Review & Approval Points
– Adaptable– Business Orientated– Comprehensive– Understandable– Measurable– Transparent– Accountabilities
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Honesty in Preparing Business Cases?
• The possibility of Bias?– Political Ambitions (Civil Service / Politicians)• International Prestige• Domestic Prestige• Personal Benefit
– Commercial Ambitions (Private Sector / Consultants)• International Prestige• Domestic Prestige• Personal Benefit
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So we have a Project Owner and a Business Case
1. Getting this far will have been a Project in its own right!2. Unmanageability and uncertainty!
1. Why increasing knowledge does not exclude unmanageability2. Natural optimism results in failure to include sufficient buffers
for uncertainty3. The Uncertainty Gap
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So we have a Project Owner and a Business Case
Source: South China Morning Post
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Project Complexity
Project ComplexityUnpredictability
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So we have a Project Owner and a Business Case
1. Getting this far will have been a Project in its own right!2. Unmanageability and uncertainty!
1. Why increasing knowledge does not exclude unmanageability2. Natural optimism results in failure to include sufficient buffers
for uncertainty3. The Uncertainty Gap