Scope & Cost Management with P6 (BSC... · Restricted @ Engin. Office J. Gnädinger 2015 All rights...

Restricted @ Engin. Office J. Gnädinger 2015 All rights reserved

JGIngenieurbüro

Competitive advantage in global solutions business

Scope & Cost Management with P6

A proven way to increase quality & efficiency

9. Primavera Community Day 2016

17. März 2016 Zürich

Hännes Gnädinger (JG) & Sebastian Schweinle (Siemens)


JGIngenieurbüro


The challenging solutions business

Enable the validation of performance to predict a reliable result

1. Paradigm shift: Prepare execution in tendering

Ensure handover of consolidated orders and scheduled key documents

2. Track progress with scheduled key documents

Ensure timely installation

3. Improve competitive advantage continuously

Take advantage of re-use and lessons learned


JGIngenieurbüro

The challenging solutions business

Are we able to apply Earned Value Management to validate the cost

and schedule performance in order to predict a reliable result?

The PwC survey shows

62% say that EVM contributes to project success

73% say that EVM is a useful tool to predict success

In companies where EVM tools are used, projects meet their scope

criteria 82% of the time, quality criteria 84% of the time and benefits

targets 80% of the time.

Why is EVM still not used widely?

PwC: PricewaterhouseCoopers


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The challenge: Apply EVM

What prevents EVM?

Project controlling disclose the development of costs not directly related

to work progress.

The disciplines at the locations disclose the work progress without direct

reference to the cost and without the view of the entire project.

Challenge: How to measure and validate the cost and schedule

performance directly related to work progress?

The big potential of earned value management is the right team behavior


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Basics

We want to predict a reliable result based on cost and time performance.

We achieve this if we are able to determine the “Earned Value Cost“.

This requires a systematic approach and supporting SW solutions.

Primavera P6

Make use of the potential of Scope & Cost Management with P6

Forecast

Scope & Cost Management


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Manage dependencies in order to validate

SCOPE Structure

Functional Units P1, P3

Controlling

Equipment OrderScope Item P1-133Scope Item P3-133

Engineering OrderScope Item 133Scope Item xy

Order Management

Scope Items P1-133 & P3-133

PROGRESS

Scheduled key documents

Earned Value Management

Cost & schedule performance validation

Customer

Specification

!

COST

Planning & Control

Functional Unit P1Scope Item P1-133

Functional Unit P3Scope Item P3-133

Order EngineeringScope Item 133

TIME


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Progress: Focus on the critical success factors

What is always critical?

Exchange of right information on time between suppliers and layout planning.

Deliver material/documents and complete civil works for timely installation.

Plan in both directions to ensure timely installation

What should be introduced?

The common language to get the necessary transparency for the information

exchange.

Ein typisches Vorkommnis:

Eine Firma lieferte zwei Kompressoren

in den Ural. Bei der Montage musste

man feststellen, dass die Raumluft-

versorgung zur Kühlung der

Kompressoren vergessen wurde.

Resultat: Terminverzug, Mehrkosten

beim Kunden (Civil Scope) und

Vertrauensverlust.


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Secret of success: Introduce a common language

SCOPE

Structure

PROGRESS

TIMECOST

Common Language: Scope Structure …

… to control orders with scheduled key documents

Quality & Efficiency

will increase significantly

PERFORMANCE

Track progress of orders with scheduled key documents


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Make use of our 30 years experience

In 2012 we have won the Siemens innovation award with Scope & Cost Management


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Example

Project scope structure

Scope configured to consolidate orders

Order 133

System Engineering

Equipment & Order Engineering

Scope Items of Functional Unit

Concept Engineering

Functional Unit P1

Order 133

Functional Unit P3


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Example cost structure

Consolidated orders to calculate and follow up

Scope organized to manage orders

Scope Item

Order

Cost calculation equipment

Cost calculation engineering

Scope Item


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Example time scheduling

Set target dates, plan resources, and control

Systems/Layout

Functional Unit P1 Equipment Scope Item 133

Connection Mat.

Civil Works

Erection

Functional Unit P2 Aux. System

Civil Works

Erection

Functional Unit P3 Equipment Scope Item 133

Connection Mat.

Civil

Erection

HW / Order Engin.

Concepts

Project Scope Structure

Purchasing Design & Manufacturing Transport Erection Commissioning

Engineering Procurement Construction

Concept / Basic / Detail

Order 133

Erection P3

Packing Lists

Completion

Certificate

Handover

Protocol

Inquiry Doc

Issue 1

Order Doc

Studies & Concepts

Test

Report

Techn./Commercial Spec.

Payment Milestones

PaymentMilestone

Start Finish

Progress Payment

Gate Review

% completed?


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Example document control

Track progress

Master Document List to plan and control services & supplies of orders

Scope Item

Progress for “% of completion”

Document Set

Key document folder

Document folder

Document


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Example earned value management

Validate performance and determine forecast

0.6

1.13Gate 1

Forecast

0.98

1.14Gate 2

Margin

Margin

TimeTime

Validation


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Benefit of Scope & Cost Management with P6

Final Margin >10%

6% - 12% Savings of EPC Full Cost 1)

Consequent document control will

• reduce 3rd party order costs by 10% to 20%

(2,5% - 5% of EPC Full Cost)

• eliminate accelerating costs

(3% - 5% of EPC Full Cost)

Scope & time transparency at interfaces will

reduce non conformance cost by 10% to 20%

(1% - 2% of EPC Full Cost).

1) Experience of turnkey power plant provider

Solid margin at contract date

Quality & Efficiency

increased significantly


JGIngenieurbüro

Conclusion: Structure scope to apply EVM

Scope & Cost Management with P6 ensure future success

0.6

1.13Gate 1

Forecast

0.98

1.14Gate 2

Margin

Margin

TimeTime

Validation

Gate Reviews

Scope Structure

Divide a big problem into

small ones, in order to

discover dependencies.


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Feed Primavera P6 with Scope Structure and Orders


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Scope & Cost Management

Configure scope in order to feed P6

Project Scope Structure

Scope items allocated to manage orders

Order Basket

COST

SCOPE


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Feed P6 WBS with Scope Structure

Target Dates

- Standard project schedule including

- Scope Items

- Costs

- Time Schedule

- Resources

- Documents


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Add documents to scope items

Documents

- Items and their related documents maintained

as activities

- Responsibility maintained globally


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Feed P6 with cost structure to manage order baskets

Costs

- “Resource Assignment View” changed to show

- Resource UDFs including

- Order Baskets

- Items

- Planned Costs


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Maintain scope items of order baskets

Scope Items (master data)

- Created as material resources

- Item attributes maintained

- Additional information maintained as UDF or Code


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Competitive advantage in global solutions business

Thank you for your attention

Ingenieurbüro Johannes Gnädinger

Lindenhof 22 CH-5430 Wettingen

[email protected]

Mobile CH: +41 (0)79 252 23 48

Mobile DE: +49 (0)151 40 258 786

mailto:[email protected]

Scope & Cost Management with P6 (BSC... · Restricted @ Engin. Office J. Gnädinger 2015 All rights...

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