Agile in EPC projects – Why I am super delighted?

Can we use agile principles outside I.T?. This is one question I had to answer many times during my project management workshops, and consistently my answer was/ is ‘Yes’. I have mentored a team of lawyers who analyse outsourced cases and submit case analysis reports back, to follow ‘scrum’, one of the agile methods.

Another question from an architect of Turner construction was about the applicability of agile / lean principles in EPC projects. This was around seven years back. My answer was ‘Partially possible’. Agile gives best results in projects where the requirements are evolving and the technology is also new to the team. The early phases of EPC projects (contracting, requirements collection, scope definition, architecture, engineering phases) satisfies ‘evolving requirements’, ‘technology ambiguity’ criteria very well, which justifies my answer ‘partially yes’. The rolling wave or moving window planning which is part of PMBOK for the last one decade, in it’s fully expanded form is nothing but iterative and adaptive in nature. I was always optimistic about application of agile and lean practices in EPC projects, except during construction phase.

Last week, I received a McKinsey report on the emerging trends in EPC from Mr. Varghese Daniel, CEO, Wrench solutions with whom I am professionally associated to analyze the global project management best practices and their application to EPC projects to improve on time and within budget delivery. My further googling got me another KPMG study on the emerging trends. Both points to Integrated Project Delivery (IPD) as one of the key trends globally, which revolves around better collaboration of motivated teams achieved through;

  • Choosing the right contract types (tri-party contracts between the owner, contractor and the architect)
  • Greater collaboration during planning phase (last planner – which is similar to iteration planning)
  • Greater collaboration during execution (construction) (burn down charts, information radiators, daily stand up meetings)

At last my hunches are coming true. All these years I was the lone crusader who used to say that adaptive(agile) and predictive (PMBOK, TCM, PRINCE2) are complimentary which raised many eyebrows, and as an acknowledgement of my views, the industry is moving towards it. I am super delighted.

About the blogger

Abrachan Pudussery is a highly experienced project management domain expert with three decades of project experience in project management, consulting, coaching and research. He has in depth knowledge about various project management frameworks (PMBOK, PRINCE2, TCM, Agile. He is the founder director of the Project Management Research Institute He is also associated with Wrench Solutions as their project management domain expert.

Why are the processes in PMBOK numbered from 4 onwards?

The processes in PMBOK are numbered from 4 onwards because chapters 1,2,3 contains the topics given below.

  • The standard for project management
  • The standard for portfolio management
  • The standard for program management
  • Code of ethics and professional conduct
  • Projects
  • Project initiation context
  • Projects, programs, portfolio and operations management
  • Organizational project management and strategies
  • Structure of PMBOK
  • Project and development lifecycles
  • Project phase
  • Phase gate
  • Project management processes
  • Project management process groups
  • Project management knowledge areas
  • Project management data and information
  • Tailoring
  • Project management business documents
  • Project business case
  • Project benefits management plan
  • Project charter and project management plan
  • Project success measures
  • Enterprise environmental factors
  • Organizational process assets
  • Organizational systems
  • Organizational structure types
  • Project management office
  • The role of the project manager
  • Project manager competencies
  • Comparison of Leadership and management
  • Performing integration

Project integration management comes under chapter 4. The first process under this knowledge area ‘Develop project charter’ is numbered at 4.1.

AACEI’s TCM vs PMI’s PMBOK

One of the things that drew me to WRENCH was its insistence on standardization. As someone who has long been immersed in PMI and AACE (the top two industry-wide standards of our time), I was delighted to meet someone who shared my view, namely, that standardization is perhaps the most overlooked yet most critical success factor in modern project management.

Daniel and I have had many long and impassioned conversations about why this is the case, whether it stems from a genuine lack of awareness on the industry’s part, or just its failure to prioritise. But now, I have hope that every EPC company will wake up and standardize its processes (in order to meet quality requirements), its departments (in order to ensure accuracy in every deliverable) and its stakeholders (in order to make sure everybody is on the same page). But how would they go about it?

Let’s say a company somehow gets convinced that it would be a good thing to ‘standardize’. What’s the next step? Most companies are likely to look into PMI, which is well-known (even if not fully understood), and some might even look into AACE, out of curiousity if nothing else. And that’s where the confusion starts. “Should we go for PMI’s PMBOK or AACE’s TCM?” How are they different? Do they complement/supplement each other?

Read the full article

pmpinjust5weeks

Evolution of ‘project success criteria’

During one of my training programs, a project manager said ‘ I am not getting acceptance for my project. What should I do get the acceptance?’. That was a difficult question to answer, considering the fact that I did not know much about his project. Still I wanted to give it a try, and I asked more questions about the probable causes that are acting in favor of project acceptance and the ones acting against project acceptance, just to understand the context better, before trying to help him out, if possible.

The key factors favoring his project’s acceptance

  • The project leadership team, especially the CEO is committed to the project
  • The product quality is excellent
  • Capability of the team is good

The key factors opposing his project’s acceptance

  • Organizational politics
  • Fear of loss of job
  • Trade union involvement …

Luckily I asked him about the ‘acceptance criteria’ of the project, which he, his team and all the key stakeholders were trying to achieve, and unfortunately it was not available. Further research reveals that, this is a major problem in many projects. The perception of success varies from project to project, and from stakeholder to stakeholder. There is no agreed upon success criteria for most of the projects, and it is a global project management problem or opportunity!.

  • Who has the right to declare success?
  • What are the criteria that will be used to determine success or failure?

Answers to these questions are critical to every project’s success, irrespective of the contract types used.

The definition of ‘project’s success’ is continuously evolving; 

1960 – Technical terms (If the product of the project is working fine, then the project is successful)

1970 – Time, Cost, Quality (Triple constraints)

1980 – Accepted by the customer

1990 – Still more criteria

(Harold Kerzner 2000)

Here is the Project Management Institute’s view of project success as per the Project Management Body of Knowledge (PMBOK Version6), Released in the year 2018 ;

“Traditionally, the project management metrics of time, cost, scope, and quality have been the most important factors in defining the success of a project. More recently, practitioners and scholars have determined that project success should also be measured with consideration toward achievement of the project objectives.”  Ref  Project Management Body of Knowledge (PMBOK) Version 6 

That is a radical shift in the definition of the success criteria of projects. Till recently, the industry believed that a project is successful if it is completed within the agreed upon time, cost and met it’s scope with required quality. As per this definition, the project’s management need not really worry about meeting the end goals of the project.

Kochi metro rail  is a project which got over on time, within the acceptable budget and met the scope with the required quality. Till last year, I believed that it’s project management is extremely successful. Did it meet it’s objectives?. I am doubtful. Since I do not know the pay back period, I am not sure. Did it ease the traffic congestion, “no”, it did not. From that perspective I may have to change my view from ‘success’ to ‘failure’ for this project. And the project manager is accountable.

As we all know, every project delivers unique product or services as it’s output (PMBOK). Based on this, the project success criteria  can be further divided into;

  • Project management success  – Time, Cost, Scope, Quality
  • Product’s success (Effect of the project’s final product)  (Baccarini 1999)

Project Success

Going by the latest view of PMBOK, project is successful if it is completed within the agreed upon time, cost, met it’s scope with required quality  and the benefits forecast used for justifying the project’s initiation is accomplished. The first part (project management success) is accomplished through professional project and program management, where as the product’s success is ensured through project portfolio management and project management combined.

Best practices :

  • Opportunity planning
  • Success criteria document
  • Monitoring stakeholder engagement

In my next blog post, I will elaborate the steps to develop, deploy and maintain the ‘success criteria document’ 

Courtesy : Wrench Solutions 

Contact 

 

 

Architectural comparison of TCM and PMBOK

Architecture refers ‘carefully designed structure of something’, and here it is about the Total Cost Management (TCM) framework. As the name suggests, the focus of TCM framework is cost management of projects and the deliverable of projects (assets). There lies the fundamental difference between the Project Management Body of Knowledge (PMBOK) by PMI, USA and the TCM framework.  PMBOK focuses on the entire gamut of project management where as the focus of TCM is on total cost management of the project, and the product of the project which is known as the ‘asset’ in TCM jargon.

tcm-framework_final

The PDCA cycle (Plan, Do, Check, Act) by Deming is the underlying theme of management. Whatever we intend to do must be planned first. Then the plan is executed. The progress is checked periodically. Actions are taken if there is a variance. The underlying theme of TCM is also PDCA (recursive PDCA cycles).

Plan-Do-Check-Act

Strategic asset management process group 

  • Asset planning (Plan)
  • Project implementation (Do)
  • Performance measurement (Check)
  • Performance assessment (Act)

Project control process group – Planning 

  • Project control planning (Plan)
  • Project control plan implementation (Do)
  • Project control measurement (Check)
  • Project control performance assessment (Act)

Enabling process 

  • The enterprise in society
  • People and performance management
  • Information management
  • Quality management
  • Value management
  • Environment, health and safety

All these processes ‘refers to’ and ‘add to’ the organizational knowledge repository and tool base.

The PMBOK (Project management body of knowledge)

The PMBOK comprises of 49 processes grouped into a two dimensional array of five process groups and 10 knowledge areas.

PMBOK Architecture

Five process groups

  • Initiation
  • Planning
  • Execution
  • Monitoring & Controlling
  • Closing

Ten knowledge areas

  • Integration management
  • Scope management
  • Time management
  • Cost management
  • Quality management
  • Communications management
  • Resource management
  • Risk management
  • Procurement management
  • Stakeholder management

Each process comprises of a set of inputs, tools and techniques and outputs.

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