The Problem
A client had been experiencing delays with its site-based capital projects during development. Extended or delayed Front-End Loading (FEL) phases were creating project planning disruptions resulting in significant portfolio management challenges. IPA had primarily conducted project benchmarking evaluations for the client, but in this case the client needed a forensic diagnosis of its FEL process to identify the drivers for its site-based project delays.
Analysis
IPA’s Asia-Pacific regional office was brought in to examine and provide an overview of the quality and performance of the client’s FEL for site-based projects. The analysis was based on 20 of the client’s site-based projects to identify trends, systemic issues, and root causes for schedule delays during each of the FEL phases- FEL 1, FEL 2, and FEL 3.
The evaluation approach comprised three areas:
- An analysis of the planned and re-baselined study phase durations and slips and comparison with Industry performance (benchmarks)
- An evaluation of the quality of the schedules. The schedule quality of the projects was evaluated to determine if deficiencies explained FEL duration target setting and schedule slip
- A review of the characteristics of each reported scope and design change as well as and cost and schedule effects resulting from the change.
The quality and performance of the schedules were tabulated to provide a schematic summary of the performance of the portfolio. Changes during FEL were also reviewed to determine their effect on schedule durations so that systemic issues and drivers could be identified. Past IPA evaluations have found that business strategy changes and scope changes are typical root causes of FEL phase schedule slip. The types of changes and sources of changes were reviewed for each of the root causes categories.
Outcomes
The review showed that the client’s site-based projects consistently followed the company’s project development process. In fact, the quality of the site-based project execution schedules was, on average, good. However, IPA determined that FEL phase completion targets were missed with regularity mainly due to poor fundamental planning, procurement and contracting issues (such as order placement limitations), and slow allocation of resources, especially after a turnover and delayed approval. The frequency and type of changes provided additional insights; the majority of changes were initiated by one function with lack of effective planning identified as the most frequent cause of change.
Overall, the IPA-led analysis found that a lack of early involvement of critical resources led to multiple project planning and development changes which resulted in extended FEL schedules across the portfolio. Resource loading provides teams with a basis for realistic confidence in FEL schedule targets and helps secure needed resources to effectively complete FEL and define projects for successful execution. The forensic analysis was successful in uncovering the FEL phase delay drivers.
*Case study by Petros Kapoulitsas, IPA Project Analyst
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