About a quarter of the small projects that IPA evaluates are considered schedule driven – the project system paid, or was willing to pay, extra money (overtime, expediting fees, etc.) to meet the schedule. Yet, less than 10 percent of the small projects IPA benchmarks are revenue-generating! The vast majority of small projects are driven by safety/ environmental regulations or reliability improvements, not revenue generation.
Paying for speed on projects that aren’t going to make you any money is generally a waste of capital. And, IPA research shows that having too many schedule-driven projects in your portfolio can diminish your project success rate. So let’s discuss the three most common “speed traps” and how to avoid them.
1. You Drag Your Feet
A common scenario is a reluctance to commit capital and resources to non-revenue-generating projects. So what happens? These projects don’t get kicked off until the regulatory deadline is fast approaching. Then they wind up paying to go fast to meet the deadline. Recognizing this pattern and initiating these projects earlier could save a lot of money. Sites using portfolio management Best Practices are less likely to see this problem.
2. Plant Management Thinks You’re Too Slow
A common refrain I hear from project organizations is “plant management thinks projects are too slow and cost too much money.” So there is constant pressure to go fast, even if that means rushing projects into execution that aren’t properly prepared. This is where benchmarking comes in handy – showing how your project data compare against Industry can help get plant management on board to accept the right trade-offs on projects, rather than always driving for speed.
3. Projects and Shutdowns Aren’t Well Integrated
When projects and maintenance aren’t in good communication and lack strong shared processes, projects wind up being identified late for shutdowns and rushing to get their engineering packages ready in time. No one wants their small project to be the one that extends the shutdown and delays production – but better integration can help avoid this problem without paying extra money.
Some small projects need to go fast, but most small projects should value low cost over fast schedule. Fixing the three problem areas above can help ensure that your small projects don’t make the wrong trade-off.
As IPA’s Manager of Plant-Based Systems, Phyllis Kulkarni oversees all global small project benchmarking, turnaround benchmarking, and licensing of the FEL Toolbox software. Phyllis joined IPA as a Project Analyst in 2002 and has led numerous site benchmarkings, project evaluations, and onshore and offshore megaproject assessments. She is fluent in English, Spanish, and Portuguese. Phyllis can be reached at pkulkarni@ipaglobal.com