The Project landscape in Australia has changed significantly in the past 3-5 years. We have seen the mining construction boom slow down significantly and move in to operations and operational improvement. We have seen the massive initial expenditure on coal seam gas projects end and move into operations and ongoing development of gas fields.
We are now seeing the start of the largest expenditure in Australia’s history on building infrastructure projects in NSW, followed by Victoria, and the other states. The sleeping giant of Queensland is just stirring from hibernation.
During the boom, projects experienced huge overruns in time and cost and suffered quality problems leading to delays in commissioning, handover and ramp up. Associated with this were huge spikes in claims and protracted negotiations which have in turn led to frustration, mistrust and lining the pockets of the reviewers and evaluators. Why has this happened? Dare I say that we don’t understand projects anymore!
Our experience has shown that common causes of project overruns and inefficiencies include:
- Inexperienced project managers and project teams,
- Insufficient training and mentoring,
- Poor project controls,
- Insufficient definition at front end of projects,
- Poor project processes and procedures,
- Poor communication within the project team.
More often than not, if a project has more than one of the above issues, it is most likely to miss key milestones. If the fundamentals are established and understood correctly, projects have a much greater potential to be successful. Success is measured in many ways. I maintain that a successful project is one where there are no surprises.
How do we make projects more successful?
- Improve definition of studies
We have seen far too many projects fail because they were rushed through the prefeasibility and feasibility study phases, failing to address some of the issues that would impact delivery. Clearly defining required outcomes during the study phases and defining what is the scope and strategy for both the business and construction will provide a clear mandate for the project or business teams.
- Improve the understanding of the required project outcomes
At the start of the project execution phase it is paramount that the project team understands the required project outcomes via a set of baseline documents. The change management program is the vehicle to capture changes to the plan and highlight early enough that a decision needs to be made to mitigate the impact of the change. It is also imperative that the project team understands the business drivers. For example, is achieving schedule more important than achieving budget? Every project has its unique drivers.
- Experienced personnel
Engage a project manager and project controls team with enough experience that they will be able to handle the trials and tribulations that a project will bring. I can guarantee they won’t be the cheapest option, but they will save you far more than you spend. There should always be a blend of experienced and inexperienced personnel so that project skills can be passed on. That’s how we learned.
Empower the project manager to hire the team that he needs to deliver the project, with the support of the recruitment / HR departments.
- Project processes
Fit for purpose project processes are a fundamental requirement for a successful project. I have worked on projects where the Owner and Delivery teams start a project without procedures! As well as physically writing the procedures, training team member to understand and know how to implement the procedures is required to ensure that they fit the project’s needs.
- Accurate progress measurement and forecasting
Quantitative progress measurement and forecasting is the role of the Project Controls team. Quantities build projects and projects need to know what quantities have been delivered / installed by commodity code and work package and what the forecasts at completion are. Without Quantity based forecasting the project is running blind.
By understanding your project, you will give it the greatest chance for success. As I’ve always said, a successful project is one without surprises.
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