Project Management Solution for E&C Industry

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2 Project Management Solution for E&C Industry Daniel Nimmo Application Sales Consulting Oracle Corporation, APAC

3 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

4 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

5 Definition of E&C

6 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

7 Industry Drivers Fixed Price Contracting Changing Conditions High Project Risk Low Margins Competitive Pricing Pressure Project Mgmt Execution Labor: Internal & External Architecture / Engineering Firms Equipment Usage: Own, Rent, Lease Construction Companies General Contractor Owner / Customer Suppliers: Materials, ETO Subcontractors Need for Collaboration Weak Project Controls Information Visibility Full Service Providers Industry Consolidation Joint Venture Partnerships

8 Industry Trend Growing Operational Complexity & long term Partnerships Requirements for Business Partners to Have Skin in the Game (e.g. Risk Ownership) Industry Consolidation Extended Offerings to Include Facilities Management - Design Build Operate (DBO) Model Increasing Collaboration and need for critical Information Visibility

9 Industry Goals GOALS SOLUTION AREA Increase Customer Satisfaction On-Time, On-Budget, Within Scope Ensure High Quality Delivery Budgeting, Forecasting, Workplan Execution Change Management Increase Margins Drive Efficiencies into Bid Process Improve Project Controls and Schedule Mgmt Project Templates: Lessons Learned, Standards for WBS & Estimates Change Management Effectively Manage Risks Provide Timely, Accurate Information to Everyone Improve Productivity of All Resources Project Execution, Issue & Change Management, Resource Management, Performance Reporting

10 What Industry Leaders Say: Oracle was instrumental in keeping track of where cost overruns were and giving good indications as to where reductions could be made. At anytime you can run a report [from the Oracle CIS] to see where we are cost-wise." When we do engineering work for projects that are $500M to $2B, there s a lot of collaboration that needs to take place. Oracle is well integrated. That s one of the main drivers to why we chose the products of Oracle." Walter J. Erb, Bechtel, IT Manager, CIO Magazine 12/1/2000 Maurice Tayeh, Technip, Group CIO, EBN Interview, 2001

11 What Industry Leaders Say: We chose Oracle E-Business Suite to help improve our overall processes and procedures, streamline reporting and increase data sharing within our organization. We are starting to see return on our investment and have already minimized the time we spend managing our back-end processes. The net result is more time and resources to serve our customers needs without cutting into our margins. - Mike Azarela, executive vice president and chief financial officer, Suffolk Construction.

12 What Industry Leaders Say: A flexible, integrated project accounting system is critical to our business because we run so many projects and employees track all hours against projects. - Frank Malangone, VP of Info Systems, CDM Oracle enables us to get all construction project info to the finance department and project managers, allowing them visibility into timelines and costs to manage the project more effectively. - Robert Mawrey, American Tower CIO

13 Industry Trend in Korea Increased merge and acquisition after IMF Improve business efficiency through Standardization of code structures (WBS,CBS etc.) and document collaboration Change area of responsibility from Build to CM (Design-Build-Service) Increased focus on reliability/availability of Cost and Financial data and its management

14 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

15 The Project Lifecycle : Core Process Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

16 The Project Lifecycle : EnC Core Process Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

17 The Project Lifecycle : Bid/Planning Phase Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

18 The Project Lifecycle : Bid/Planning Phase Streamlined Bid Preparation Leverage historical data (Project Templates): Update Templates from lessons learned during close-out Update standard WBS and schedules Include updated resources & estimates Quickly assemble new bid/estimate Schedule and rapidly adjust plan Roll estimate data into budget for project execution phase Historical Bid & Project Information Generate Bid/Estimate Roll-up Workplan resources to budgets

19 The Project cycle starts and ends by leveraging historical data such as lessons learned.

20 Project Templates address standardization of Work Definition, Progressing & Reporting

21 In an ETO environment, Project Deliverables drive integration to Manufacturing through links to items (sub-assemblies).

22 The Project Lifecycle : Bid/Planning Phase-ETO Streamlined Bid Preparation & BOM Integration Leverage historical data (Project Templates): Include existing estimates Linked to Manufacturing BOM Roll-up resources from BOM* Quickly assemble new bid/estimate Schedule and rapidly adjust plan Roll estimate data into budget for project execution phase Historical Bid & Project Information Generate Bid/Estimate Roll-up Workplan resources to budgets

23 Bid/Planning Phase-ETO Oracle Scheduling Tool WBS Forecast Activity Activity Budget Estimation Resource For Project Scheduling Plan/Actual Plan/Actual Resource Resource Schedule Resource ITEM/BOM/Routing R R

24 Manufacturing BOM and Routing rolled up to Project Resources via End Item Linkage Bid/Planning Phase-ETO

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27 Bid/Planning Phase Resource Detail

28 Bid/Planning Phase Top Down/Bottom up Simulation

29 Bid/Planning Phase Flexible Resource Breakdown Structure

30 Bid/Planning Phase

31 The Project Lifecycle : Project Execution Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

32 The Project Lifecycle : Project Execution Workplan and Financial Structure Support Workplan Structure Shared Mapped Separate Financial Structure Tasks Categories Support All Operational Structures Shared workplan and financial structure Partially shared workplan and financial structure Mapped workplan and financial structures Separate workplan and financial structures Rollup of Workplan and Financial Structure Rollup Effort (Planned, Remaining Effort) from Workplan to Financial Structure for Budgeting and Forecasting Rollup Progress from Workplan to Financial Structure Definition and updates of structures in web interface

33 Planning & Execution

34 Progressing of ETC and % Complete supports Earned Value & Forecasting

35 Configurable Project Manager s Workbench

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37 The Project Lifecycle : Project Execution Collaboration on Assigned Work Project Managers Executives Documents Deliverables Tasks Team Members Secure, Role-based Collaboration Work in real time with customers/suppliers Collaborate on deliverables, documents and tasks Track Deliverables, Status and Associated Tasks Store files on a secure project document repository Oracle Files Online Any system using WebDav protocol Foldering, Versioning, and Locking

38 View and update of owned tasks

39 View and update of resource-level progress

40 Documents stored and shared via the project and task structure

41 Collaboration via CAD Viewer

42 The Project Lifecycle : Project Control Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

43 The Project Lifecycle : Project Control Streamlined Forecast Actual & Future Costs Percent Complete Changes Initial Budget Forecast Forecast (EAC) = Actuals + ETC ETC based on: Earned value Percent complete Future budget amounts Future resource schedule Work quantity Workplan Remaining effort Open commitments Change documents Compare variances to prior forecasts Automatic creation of initial forecast on baseline of approved budget Adjust quantity, rates, cost or revenue by percentage across planning elements

44 Plan type/version Comparison of Forecast & Budget Versions

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46 Actual Costs vs Budget vs Forecast

47 Actual Costs vs Budget vs Forecast by WBS/Task

48 Actual Costs vs Budget vs Forecast - by Resource

49 Earned Value Analysis supports trends and Forecasting

50 Project Control

51 Project Control Issue Change Request Change Order Define Issue Collaborate Resolve Does Issue result in Project Change? Create Change Request Copy Issue Define Impact Approve Create Change Order Include Change Requests Approve Implement Impact

52 The Project Lifecycle : Analysis & Close-out Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

53 The Project Lifecycle : Analysis/Close-out Performance Reporting Work Project Resources Visibility across all levels of project Multiple reports Report Financial Info and Earned Value Configurability with Graphs and Drilldown Analysis by WBS, RBS, Period Report Project and Project Functional Currencies Drilldown from Project Intelligence Enhanced Project Status Inquiry in web interface

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56 Analysis/Close-out

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58 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

59 Industry Goals GOALS SOLUTION AREA Increase Customer Satisfaction On-Time, On-Budget, Within Scope Ensure High Quality Delivery Budgeting, Forecasting, Workplan Execution Change Management Increase Margins Drive Efficiencies into Bid Process Improve Project Controls and Schedule Mgmt Project Templates: Lessons Learned, Standards for WBS & Estimates Change Management Effectively Manage Risks Provide Timely, Accurate Information to Everyone Improve Productivity of All Resources Project Execution, Issue & Change Management, Resource Management, Performance Reporting

60 Project Management Through Lifecycle Project Selection Metrics KPI s Reports Analysis / Close-out Work Resources Finances Objectives Scenarios Portfolios Bid / Planning Phase Workplans Resources Budget Updates Forecasting Changes Billings Capitalization Project Control Project Execution Progress Documents Issues Actuals

61 Agenda Definition of E&C State of the Industry The Oracle Solution E&C and ETO Summary References

62 E&C Global References

63 E&C Local References

64 Package Selection Statistics Reference Oracle S** YEARS

65 Q U E S T I O N S A N S W E R S