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Project Control - Overview

15 January 2011

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls

AGENDA•Introduction•Basic Concepts

•Project•Control System•Project Control Systems

•Current Situation in TAFSEER•Action Plan•Conclusion

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 2

Introduction

•Competitive Business Environment•Project Status – Cost Overrun & Delays for various reasons•Profit = Income – Cost

•Need for Efficient working•Need for Improved Control

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 3

Basic Concepts

•Project•Control System•Project Control System

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 4

Basic Concepts - ProjectProject is Unique – Non-repetitive

It is Temporary Endeavour – Have Definite Start & Finish

Consume Resources:•Manpower•Materials•Machineries & Plant•Money

5 Project Life Cycle Stages •Initiation - Starting•Planning - Preparing•Execution - Doing•Monitoring & Control•Close Out

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 5

Basic Concepts – Project (contd.)

9 Project Management Knowledge Areas•Integration•Scope•Time – Schedule•Cost•Quality•Human Resources•Communication•Risk•Procurement

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 6

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 7

Source: PMI’s PMBoK 4 e Project Management Process Groups (42)

Knowledge Area (42) Initiating (2) Planning (20) Executing (8) Monitoring & Controlling(10) Closing (2)

Project Integration Management (6)

–Develop Project Charter

–Develop Project Management Plan –Direct & Manage Project Execution

–Monitor & Control Project Work –Perform Integrated Change Control

–Close Project or Phase

Project Scope Management (5)

–Collect Requirements–Define Scope–Create WBS

–Verify Scope–Control Scope

Project Time Management (6)

–Define Activities–Sequence Activities–Estimate Activity Resources–Estimate Activity Durations–Develop Schedule

–Control Schedule

Project Cost Management (3)

–Estimate Costs–Determine Budget

–Control Costs

Project Quality Management (3)

–Plan Quality –Perform Quality Assurance

–Perform Quality Control

Project Human Resources Management (4)

–Develop Human Resource Plan –Acquire Project Team–Develop Project Team–Manage Project Team

Project Communication Management (5)

–Identify Stakeholders

–Plan Communications –Distribute Information–Manage Stakeholders Expectations

–Report Performance

Project Risk Management (6)

–Plan Risk Management–Identify Risks–Perform Qualitative Risk Analysis–Perform Quantitative Risk Analysis–Plan Risk Responses

–Monitor & Control risks

Project Procurement Management (4)

–Plan Procurements –Conduct Procurements

–Administer Procurements –Close Procurements

Project Management Process Groups and Knowledge Areas Mapping

Project Management Processes & Major

Activities

8Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls

Basic Concepts – Control System

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 9

InputsOperations - Processing

Outputs & Forecasts

Desired requirements – Budget, Time, Profits etc

Comparison

Feedback, Changes & Corrective Actions

Deliverables

Objective of Integrated Control System is to integrate various processes & stages with main focus on minimize negative variances and improve positive performances

Measure Variances

Integrated Control System

Basic Concepts – Control System (contd.)

Control is one of the managerial functions like planning, organizing, staffing and directing. It helps to check the errors and to take the corrective action so that deviation from standards are minimized and stated goals of the organization are achieved in desired manner.

Control in Management means: •Setting performance standards – like Budget, Productivity Norms, etc. •Measurement of actual performance. •Comparing actual performance with standards. •Analysing deviations. •Correcting deviations.

Characteristics of Control :•Control is a continuous process •Control is a management process •Control is embedded in each level of organizational hierarchy •Control is forward looking •Control is closely linked with planning •Control is a tool for achieving organizational activities, Objectives & Performance

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 10

Basic Concepts – Project Control Systems

What is Project Control System?

•System to control & Improve overall Project performance.

•Project Control System keep balance of constraints of •Scope•Time or Schedule. •Cost . •Quality. •Risk•Resources

Any Change in one of the above constraint will result on change on atleast one other constraints which affect the equilibrium. Hence, while evaluating any change overall balanced view should be taken before approving the change –

•There is Need for integrated controls

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 11

Time

Scope

QualityRisk

Project Constraints

CostIntegrated Controls

Resources

Basic Concepts – Project Control Systems Contd.

Project Control Systems applies at various Stages of Project:

•Initiation Stage (Tendering)•Mobilisation Stage (On award – Manpower, Equipments /Issue of LOIs/LPOs/WOs)•Execution Stage (periodic progress – MPRs, Receipts & Payments, Technical Submissions)•Close out stage (Handing Over – Final Accounts)

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 12

Time

Benefit diminishes over time

Basic Concepts – Project Control Systems Contd.

•Initiation Stage (Tendering)•Review Tender Documents (details of BOQ, Tender documents, & Tender drawings, Addendums issued by Client during tendering process. Suggested that Tender dept shall provide copy of such documents immediately on receipt to PMC Dept at HO.•Review the basic working made by Estimation Dept for quantities of major work items planned to be executed in-hose - especially breaking down to various buildings / phases / floor wise / heights variances upto 3.5 mt , 3.5 to 4.5 m, 4,5 to 6 mtrs, 6.0 to 9.0 m, 9.0 to 12.0 mt & above 12.0 mtrs clear height – floor areas, surface areas, perimeters, volumes to be calculated and co-related•Review Overall construction Strategy worked out for project executions alongwith workings of Estimation Dept for Overall resources requirement schedule for:

–Materials–Consumables–Manpower–Subcontractors–Formwork requirements–Equipments–Staff–Mobilization–Local Authority Approvals requirements–Other site requirements

•Review the Risk analysis performed especially issues relating to Design Requirements, Consultant, Client, Local Authorities requirements, Project Duration requirements, Contract conditions for variations, escalations, various responsibilities, Site Conditions and similar other special requirements.

•Have a site visit alongwith the Tender Department person during tendering.

•Provide feedback to Tendering Dept for any special attentions / queries to be raised to be clarified from the Client / Consultant.

•Participate in final negotiation process before accepting the Contract award

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 13

Basic Concepts – Project Control Systems Contd.

•Mobilisation Stage (On award – Manpower, Equipments /Issue of LOIs/LPOs/WOs)

•Collect Final Contract Documents - details of BOQ, Tender documents, & Tender drawings, working of quantities, rate analysis & pricing basis considered by the estimation dept. while finalization of the Tender proposal & control. •work out Construction BOQ based on construction drawings and make variance analysis. •work out the Overall resources requirement schedule for:

–Materials–Manpower–Subcontractors–Equipments–Staff–Mobilization–Other site requirements

•Work out the Master Budget for all resources item wise with Quantities, Rate & Amount.•Proceed for Resources Mobilisation-Manpower, Equipments, Issue of LOI/LPO/WOs in line with approved master budget Mobilisation

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 14

Basic Concepts – Project Control Systems Contd.

•Execution Stage (periodic progress – MPRs, Receipts & Payments, Technical Submissions)Data Collection from project sites:

– Construction Drawings & Material take-off– Receipt of materials– Consumption of materials Reconciliations with requirements/usage– Manpower utilization– Equipment utilization– Subcontract works and Reconciliation with Billed to Client– Work progress– Revise drawings/Site instruction issued by the consultant– Other relevant details

Review valuations, variation/claims analysis & Contractual Correspondences & Technical Submissions .

Monitor & update the resources schedules as the work progress based on actual quantities, rates etc. and

Prepare cost reports and variance report on monthly basis.

Arrange project review meetingsReport to the Management on monthly basis for review of the following:

– Project wise Profitability– Cash flow– Cost report– Variance analysis– Suggestions for Improvement

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 15

Basic Concepts – Project Control Systems Contd.

•Close out stage (Handing Over – Final Accounts)Review Final Handing over documentations requirements

Prepare & Review Final Statement of Account for Client

Review Final Statement of Accounts for Sub-Contractors

Review As-Built Drawings

Review Arrangements & requirements for Maintenance Periods

Support for Final Handing Over sign off

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 16

Current Situation in TAFSEER

Following Points Hinder Effective Project Control at Sites: – Lack of Awareness about Project Control requirements– Lack of formal process for Project Control– Lack of Clarity of Roles – Job Description & Integration with others– Lack of Effective Decision Making– Lack of proper Planning for Resources & Utilization– Lack of Proper Communication & Flow of Information– Lack of Competent Manpower– Lack of Proper Documentation for Project Controls required for various Stages

However, the plus point - there is Management Commitment to Implement and Support Project Control Systems

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 17

Action Plan

However, Following Actions will help us move in proper direction: – Formal Training for Project Management & Controls– Formalized process for Project Control– Clarity of Roles – Job Description to be finalised & Issued to Staff– Decentralization of Common Services for Project– Higher Authority & Accountability system for Project leaders– Establishing System for Conflict resolution – Cost, Time, quality & Risk– Transparency in Decision Making– Improving Communication & Flow of Information– Keeping Proper Documentation– Efforts for Continuous Improvement of Productivity & Resource Utilization– Performance Linked Incentive Scheme

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 18

Conclusion

We have a Long Way to go for Effective Project Control at Sites,

But, with Support from the Management and Project Teams,

we can improve our performance on a sustainable basis for All Projects that we Execute & Deliver within Agreed Time & Budget.

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 19

THANK YOU Q & A.

Kishan Solanki, BE, LLB, AICWA, FCCA, MBA, PMP, CCEContracts Manager & Head of Project Controls 20