Work Process Reengineering Workshop
The Work Process Reengineering Workshop is designed to help establish a project process. This workshop is most often held in conjunction with a benchmarking study which identifies the strengths, weaknesses and practices being used by the given project process.
Many organizations have an established work process to execute their projects. When an established, disciplined work process is coupled with good project practices, lower costs can result. IPA has unique knowledge of the practices that have resulted in successful and unsuccessful implementation of work processes and has a history of implementing successful metric programs. IPA pioneered the development of the five-stage capital work process that is now employed by the most capital-effective companies in the process industries.
IPA has developed an idealized project development process that identifies the key stages of the asset development, as well as the major interfaces among the different functions. This process aligns each functional project to provide project deliverables and critical information at the appropriate stages of the asset development life cycle. The process provides a means to do the following:
Track task and activity progress.
Coordinate and synchronize multifunctional activities.
Obtain buy-in across all levels and from all functions.
A project system is much more than the manifestation of the engineering function, which consists of the business enterprise, technical functions, and manufacturing. The approach IPA takes to reengineering emphasizes a holistic approach to project systems. The approach begins with understanding the project system’s strengths and weaknesses or the “As Is” state of the project system. This “As Is” is compared with the idealized system, and an analysis of the gaps between the organization’s system and that optimal system is produced. A project process is then developed that integrates IPA’s knowledge of Best Practices for capital effectiveness with the specific needs of the organization.
The major product from the workshop is a roadmap of the project process customized for the organization. The workshop will also provide the tools and guidelines as they apply to the developed process. Participants in IPA’s workshop will receive a workshop notebook with all presentation slides and reference materials.
IPA has assisted more than 20 companies in redesigning how they approach capital projects. IPA’s project system work process has been used as the starting point for the redesign of capital project systems around the world.
Institute Workshops are facilitated by experienced IPA staff. Facilitators have analyzed many projects and have worked with project professionals to improve the results of their projects. IPA has conducted more than 120 workshops for major oil and chemical companies.
Workshops must be customized to a specific project system. The first step to understanding the project process is to identify the strengths and weaknesses of the organization’s capital project process and how competitive that process may be relative to that of other project systems. This then forms the basis from which an improved project process can be structured.
The workshop includes classic process mapping activities supplemented by IPA’s specific expertise in capital project areas and knowledge and of the organization’s project practices and performance. Although each workshop’s activities will be customized to the specific company needs, most workshops typically include mapping the current process, identifying deliverables for meeting new project system requirements, defining a map for the new project process, and developing an implementation plan.
“As Is” Process Evaluation
The workshop begins with a detailed discussion of the current project process or the “As Is” process. It then highlights the major activities, decision points, and interfaces in the current work process. This process uncovers gaps, redundancies, and other issues with the current process.
Identify Gaps Between “As Is” and Best Practice
Using the “As Is” map developed in the workshop and knowledge of the organization’s project practices and performance, gaps in the process between actual practices and Best Practices can be identified. This sets the stage for developing an improved project process.
Development of “Should” Roadmap
This module will build the roadmap for the project process. It will include the presentation of important activities needed for effective capital project systems as identified in IPA research. Then, using the deliverables identified for each key decision gate, a precedence map will be generated to identify the activities necessary to prepare for completing these deliverables. This activity will produce a generic roadmap that reflects activities needed at each stage.
Identify Deliverables at Each Decision Gate
This module discusses the key deliverables at each stage of the process and will list the required deliverables for each project phase. This module will identify tools that can be used to complete the deliverables where appropriate.
The workshop concludes with a discussion of how to successfully implement work process changes.
The workshop should include representatives from all functions involved in the capital project process. This includes representation from business, planning, process development, and operations, along with project management functions, such as engineering, procurement, and construction. Each function must be represented by people who have an in-depth knowledge of the process as it actually is working and by leaders who are empowered to implement change.
The Work Process Reengineering Workshop can be conducted either at a company’s facility or at a nearby conference center. We strongly recommend an off-site location to allow participants to focus on the workshop activities.
Holding a Workshop
For more information about the Work Process Reengineering Workshop, contact the IPA Institute directly at IPAInstitute@ipaglobal.com. To ensure interaction among participants, the optimal workshop size is between 15 to 20 participants. We recommend that a subset of participants be identified in advance to consolidate the results of the workshop with the FEL Roadmap and checklists produced in the workshop.
Best Practices for Mining Projects
The Best Practices for Mining Projects course is designed to provide participants with Best Practices and learnings that have been shown to improve capital project effectiveness. This program integrates findings from IPA’s extensive quantitative research that links project management practices to project outcomes. This training can be integrated with the company’s project management work process, allowing industry Best Practices to be incorporated into the project system. This course focuses on practices implemented early in the project, such as project definition for mine development projects. This program is registered with the Project Management Institute (PMI), allowing attendees to easily claim 16 Professional Development Units (PDUs) upon completion of the course.
The Best Practices for Mining Projects course provides a forum to discuss the factors that lead to competitive project outcomes. The course will identify effective strategies for the following:
Defining mining and minerals project that best meet business needs
Building an effective team
Implementing contracting strategy
Improving the business value
Implementing technology improvements
Understanding and managing risks
Setting and achieving competitive targets
Controlling a project as it progresses through execution
Planning and scheduling projects
As the leading research-based consulting firm focusing on the development of tools and methods to improve capital effectiveness, IPA has determined the major factors that directly affect the relative performance of capital projects. Most excellent project systems—those that deliver excellent returns on capital spent—incorporate the fundamentals of these key leading indicators into their work processes for projects. The program will cover these factors.
The training course’s primary focus is to present in detail the key learnings and practices for project planning and execution that lead to superior outcomes. The training course will provide the following:
Key elements of team effectiveness.
Project drivers that lead to successful completion of each phase of Front-End Loading (FEL), the critical project definition phase, including the key deliverables that are required at the end of each phase and the objectives of each phase
Important elements of FEL for mining projects
Deliverables of FEL, including a detailed discussion of key elements of site definition, engineering definition, and project execution planning
The important elements of contracting strategy and the implications of contracting choices on project results
Additional engineering Best Practices (Value Improving Practices [VIPs]) that Industry uses to leverage extra value from a solid project definition package
Tools and techniques for identifying and mitigating risks
Practices that are important in controlling projects as they proceed through the execution
Research findings that can be used by owners to improve construction safety.
Course Content and Organization
The Best Practices for Mining Projects course is a 2-day training program. The course uses a combination of lecture, facilitated discussion, and case studies. Research findings are communicated through lectures. Participants share their experiences and relate learnings to their own experience through facilitated discussions. Case studies of actual mining projects allow participants to apply course learnings to real projects.
The training course is divided into a set of modules, each covering a specific topic important in the capital project delivery process. The modules include the following:
Module 1: The Business Stake
This module sets the stage for the entire course by identifying the place of projects in the business supply chain and the impact of project performance on business competitiveness, and also discusses the execution of projects in the current environment.
Module 2: Mining Project Pathway to Success
This module presents a Pathway to Success for minerals asset development based on IPA’s quantitative research. The key elements include orebody definition, mine complexity, technology selection, scope definition, appraisal strategy, project definition for mine and facilities) degree of team integration, target setting, and project execution discipline. These practices are then linked to effectiveness of all components of asset development.
Module 3: Team Effectiveness
Team effectiveness is an important driver of good project outcomes. This module focuses on the theory of teams and their use on capital projects. The module addresses the components of effective team and owner core competencies. This section also discusses effective integration of contractors into the project team.
Module 4: Mine FEL – Orebody Definition
We review each element of the Mine FEL: Orebody and Overburden Definition, Site Factors, Engineering Status, and Project Execution Planning. Key deliverables for each of these elements at the time funds are authorized, as they apply to the mine portion of a capital investment, will be presented. Examples of problems that occur when definition is incomplete will be discussed.
Module 5: Mine FEL – Site Definition
This module addresses aspects of project definition related to not only the characteristics of the project location, but more importantly also to land and mineral deposit accessibility. We also show how proper definition reduces project risks by clarifying assumptions, completing critical deliverables, and engaging local participants. Physical, regulatory and design issues are also covered.
Module 6: Mine FEL – Engineering Definition
Addresses aspects related to the status of mining method selection, equipment selection, mine design and planning using optimization tools. This section discusses how engineering definition can help develop specific production strategies to support downstream production (stockpiling and blending), considers status of specific engineering design deliverables and participation by key stakeholders, and reduces risks with proper definition because key engineering items are complete and provide a sound basis for the estimate.
Module 7: Facilities Site Definition
As one of the major components of the FEL Index, site factors addresses aspects of project definition related to the characteristics of the project location, and considers physical, regulatory, and design issues. Proper definition reduces project risks by clarifying assumptions, completing critical deliverables, and engaging local participants
Module 8: Facilities Design Status
Another component of the FEL Index, Design Status addresses aspects related to the status of the process design (or conceptual design) and detailed design; considers status of specific engineering design deliverables and participation by key stakeholders; and reduces risks with proper definition because key engineering items are complete and provide sound basis for estimate
Module 9: Project Execution Planning
The Project Execution Plan (PEP) is the result of defining the approach to be followed in executing a capital project and answers some basic questions about the project, such as: Who will participate, when will they participate, and what roles will they take? How the mining team is integrated/interfaced with processing and other facilities teams? How will the project be contracted, sequenced, managed, and controlled? When will phase transitions and specific activities take place?
Module 10: Project Controls
This module covers the owner role in project execution and control. Topics include design, procurement, and construction management. Best Practices in project control are discussed.
The program is intended for existing project managers and those who are moving into the project manager role in the near future. In this course, we present learnings derived from the analysis of thousands of actual projects.
Best Practices for Mining Projects is officially registered with PMI, which allows attendees to easily claim 16 PDUs upon completion of the course. Simply visit the PMI Continuing Certification Requirements site and submit the PDU Activity Reporting Form (Provider Number: 2767 / Activity Number: XXX-MIN). For those claiming PDUs through other education organizations, please note that the duration of this course is 16 hours.
Value Improving Practices (VIPs) Workshop
IPA research has demonstrated that Value Improving Practices (VIPs) are linked to improved project outcomes. The VIPs Workshop will provide those who attend with an increased understanding of what these practices are and how to implement them to gain the most benefit in capital effectiveness.
VIPs are out-of-the-ordinary practices used to improve project performance, and they are primarily used during the Front-End Loading (FEL) of a project. VIPs are formal, documented practices involving a repeatable work process with measurable results. They are not cost-reduction exercises or project readiness reviews. Many practices used in executing projects have potential to add value, such as peer reviews and lessons learned. However, only practices with a demonstrated, statistically reliable connection between use and better outcomes are labeled as VIPs. The VIPs to be discussed in the workshop are shown in the figure below.
The VIPs Workshop provides participants with a better understanding of what VIPs are, how to select the practices that add the most value in a specific circumstance, and when and how to use these practices. The workshop will help organizations to establish a VIPs selection process as part of their project work process.
Participants in the VIPs Workshop will be provided with a detailed description of each of the VIPs and guidelines for using these practices. In addition, the workshop will provide examples of each of the practices.
Institute workshops are facilitated by experienced IPA staff. Facilitators have analyzed many projects and have worked with project professionals to improve the results of their projects. IPA has conducted more than 120 workshops for major oil and chemical companies.
The focus of the workshop is to establish a VIPs implementation process within the organization’s project work process. Many workshops begin with an assessment of the current use of VIPs. An analysis can then be done on the gap between optimal implementation of VIPs and the current use. This then becomes the basis of establishing the improvement program.
Each workshop is customized to meet the specific needs of a given organization. Workshops are a combination of presentation of key learnings and interactive sessions for participants to apply information to their own organization. Topics covered for each VIP include the following:
Through its research, IPA has identified a set of practices that have been demonstrated to add value to capital projects. Each of these practices will be defined in detail. The value that each practice can add to project outcomes will also be presented.
How and When to Execute VIPs
Practices can only add value if they are used at the appropriate project stage and are implemented effectively. In this section of the workshop, we discuss when in the project cycle each VIP must be used to gain the maximum value from the activity. This section discusses why the timing is important and presents methods on how to use each VIP to gain the most advantage from the activity. Workshop participants will then have the opportunity to adapt this information to their situation to establish their criteria for VIPs selection.
Methodology for Selecting VIPs
VIPs selection is important. This module discusses the process for selecting VIPs to be used on a project. The selection process discussion includes how to determine the applicability of each VIP. This module also discusses how to ensure alignment of the business and project objectives and VIPs selection. Participants will receive Guidelines to Plan and Schedule VIPs.
Building a System to Measure VIPs Use and Effectiveness
Incremental value is added to a project when VIPs are used appropriately. Proper documentation of VIPs use is key to supporting their perceived value. A system for measuring benefits shows the value of these practices. Practices for implementing a documentation and measurement system for the organization will be discussed.
The workshop should include representatives from technical functions including engineering, construction, procurement, operations, and process development. Some representation from other functions, such as business, is needed to ensure that any process established is aligned with business needs. Each function must be represented by people who have an in-depth knowledge of the process and by leaders who are empowered to implement change.
The VIPs Workshop can be conducted either at a company’s facility or at a nearby conference center. We strongly recommend an off-site location to allow participants to focus on the workshop activities.
Holding a Workshop
For more information about the VIPs Workshop, contact us directly at IPAInstitute@ipaglobal.com. To ensure interaction among participants, the optimal workshop size is between 15 to 20 participants.
Establishing Effective Capital Cost and Schedule Processes
Setting attainable cost and schedule targets is an important consideration in making investment decisions. Most organizations have more opportunities than they have funds to invest. Establishing Effective Capital Cost and Schedule Processes teaches individuals to make the most effective use of available capital by setting accurate and reliable cost and schedule targets. This program is registered with the Project Management Institute (PMI), allowing attendees to easily claim 16 Professional Development Units (PDUs) upon completion of the course.
Establishing Effective Capital Cost and Schedule Processes is a 2-day seminar. Research findings are communicated through lectures. Participants also share their experiences and relate learnings to their own experience through facilitated discussions. In addition, the course includes case studies that enable participants to apply course learnings to real projects. This program can be customized into a private course for your organization. Customization includes an analysis of your organization’s cost and/or schedule estimates.
Module 1: Introduction
Overview of the course objective and learning outcomes. Provides details about the IPA database, normalization process, and metrics that are key to understanding the different research studies used to prepare the course material and the benchmarks presented in the course.
Module 2: Cost Estimating Overview
Covers basic definitions to align the audience with the concepts that will be used during the course. Estimate classifications throughout the project life cycle, their objectives, estimating methods, and engineering and project controls deliverables are discussed by phase. The module defines contingency and explains the different methods to calculate it. Estimate quality/accuracy and escalation are also presented in this module. Industry benchmarks and their correlation to project outcomes are shared in each of the sections of this module.
Module 3: Schedule Estimating Overview
Provides basic project schedule definitions and details about the IPA scheduling software data. Schedule levels are discussed and the optimal level of schedule definition at the end of Scope Development (FEL 2) and Project Planning (FEL 3) phases are covered. The module also explains Best Practices for schedule development and their correlation to project cost and schedule performance.
Module 4: Cost & Schedule Integration Using the Project Work Breakdown Structure (WBS)
Discusses the importance of aligning costs and schedules, and explains their interaction throughout the project. The Cost Breakdown Structure (CBS) and its elements are discussed. The scope definition process is presented and high-level process WBS is developed. Organization Breakdown Structures and contractor’s Code of Accounts are also presented.
Module 5: Validation and Metrics
Describes the difference between validation and review of cost/schedule estimates; identifies methods and techniques used to validate cost and schedule estimates. Tools and techniques, sample metrics, industry trends, and the benefits of validation are presented.
Module 6: Project Control
Provides general project control definitions, functions, and activities. The project control process map is presented and the current environment is discussed. IPA project control research and control Best Practices for better project performance are shared. This module introduces the IPA Project Control Index (PCI) and explains how the PCI is linked to cost and schedule performance.
Module 7: Engineering and Labor Productivity
Highlights the importance of clearly understanding engineering and labor productivity, and discuss the factors that drive both improved engineering performance and competitive labor productivity separately.
Module 8: Wrap-Up
An overall summary of the learning outcomes covered throughout the course and an education path forward.
Establishing Effective Capital Cost and Schedule Processes allows those who participate in the capital process to better understand the elements of high-quality cost and schedule estimates and provides Best Practices for project controls, scheduling and early estimating. estimates and the details of project execution planning. The program provides skills on how to handle escalation in cost estimates, as well as methods and techniques used to validate cost and schedule estimates. The information learned in this course can be immediately applied to ongoing and future projects.
The program is intended for advanced entry level representatives from owner companies and sponsor organizations who possess a basic understanding of cost and schedule estimate preparation. These representatives include project managers, cost estimators, those responsible for cost control or establishing project schedules, and professionals who have direct interaction with the project controls function.
This seminar is also offered as an in-house company (private) course. By focusing the seminar for an individual company, specific issues concerning the company work process can be discussed. Courses will be customized to meet each individual organization’s needs. Contact IPAInstitute@ipaglobal.com today to request a proposal.
Establishing Effective Capital Cost and Schedule Processes is officially registered with PMI, which allows attendees to easily claim 16 PDUs upon completion of the course. Simply visit the PMI Continuing Certification Requirements site and submit the PDU Activity Reporting Form (Provider Number: 2767 / Activity Number: INS-CSP). For those claiming PDUs through other education organizations, please note that the duration of this course is 16 hours.
Best Practices for Small Projects
Best Practices for Small Projects is a 3-day training course that focuses on capital project planning and execution in the context of small and plant-based capital projects. Organizations spend between 30 to 65 percent of their capital budgets on small projects (less than US $10 million). IPA research has found that these small projects are frequently less successful than the larger projects executed by the same company. These small and plant projects are a mix of maintenance, regulatory, and revenue-generating projects. Both central project groups and plant-based project groups execute these small projects. This program is registered with the Project Management Institute (PMI), allowing attendees to claim 22 Professional Development Units (PDUs) upon completion of the course.
The objective of the course is to present Best Practices and key learnings that program participants can apply to small projects in improving their performance. The course focuses on the specific work processes for smaller projects. Attention is paid to practices associated with executing projects in operating plants. The unique aspects of small and plant projects addressed in the course include annual budgeting process, small project teams and resources, revamp issues, and turnaround/shutdown interface issues. Most small projects that are executed in operating facilities involve some amount of revamp work. This module discusses the critical issues that revamp projects face and outlines strategies to address those issues.
Course materials are based on the cumulative findings of over 20 years of research. IPA maintains proprietary databases of projects executed by more than 200 companies. The IPA databases store detailed information on over 3,000 small capital projects. IPA uses these databases to conduct quantitative research and has identified practices and work processes that lead to more effective use of capital invested in small projects. Small and Plant Project Delivery Excellence integrates key aspects of this body of knowledge into a single course.
Participants have the opportunity to gain a firm understanding of the key drivers of success for these critical projects, which often are overlooked by large corporations. The learnings provided in the course will be directly applicable to ongoing and future projects. The Best Practices presented throughout the course provide participants with tools and techniques that can be immediately used to improve the effectiveness of their project systems, which will result in better project results. In addition, participants will benefit from networking with other project professionals throughout the course.
Course Content and Organization
Best Practices for Small Projects covers 3 days and consists of 12 separate modules. The modules present the material in coherent and concise packages. The instruction method includes lectures supported with presentation slides and additional reading, active class discussions, class exercises, and breakouts. The specific course modules for the course are the following:
Module 1: Business Stake
This first module sets the stage for the entire course by giving some basic definitions and reviewing the basic structure and purpose of a small project delivery system.
Module 2: Front-End Loading
A key element of project success, Front-End Loading (FEL), is the process of defining the project before detailed design work begins. The module presents details around FEL and explains the importance of FEL to project outcome performance.
Module 3: Portfolio Management
The module in the course focuses on practices for aligning small and plant projects with business needs. Issues that can greatly affect smaller projects such as cash flow restrictions will be explored. This module covers issues related to portfolio management and project selection. We will conclude with a summary of the practices found to drive excellence in small and plant projects.
Module 4: Team Effectiveness
Small project systems are often constrained by resource limitations. This module addresses the core competencies required by a project system. It also covers team composition and effectiveness for small projects.
Module 5: Site Factors Component of the FEL Index
This module addresses the site definition component of FEL. It presents Best Practices for site definition and explains why these practices are critical to project success.
Module 6: Design Status Component of the FEL Index
This module presents the engineering definition component of FEL in detail. It includes a detailed discussion of what specific engineering deliverables should be complete prior to the start of production design.
Module 7: Project Execution Component of the FEL Index
This module covers the owner role in project execution and control. Best Practices and IPA research findings are discussed.
Module 8: Successfully Installing Small Projects During Turnarounds
This module details the need for integration between capital project teams and maintenance turnaround teams, areas where integration is important, best practices for concurrently executing capital projects and maintenance turnarounds, best timing for completing integrated tasks, and the costs of not integrating.
Module 9: Value Improving Practices
This module defines Value Improving Practices (VIPs), explains how the proper use of VIPs drives project outcomes, and describes each VIP in detail.
Module 10: Contracting Strategies
This module will discuss definitions of different contracting approaches and the rationale for using them. It also presents research on the effect that different contracting approaches have on project outcomes.
Module 11: Construction Safety
This module addresses the role of the owner in construction safety and presents research into the practices that drive better safety performance.
Module 12: Project Controls
This module covers the owner role in project execution and control. Topics include design, procurement, and construction management. Best Practices in project control are discussed.
This program is intended for individuals who would benefit from a comprehensive course on how to develop and/or implement an effective project delivery system for small or plant projects. The course is designed for project professionals from owner companies, such as plant engineering managers, experienced project managers, and project control specialists. Contractor personnel sponsored by an owner are invited to attend. In addition, the course is also valuable for plant and business managers who are responsible for portfolios of small capital projects. The ideal participant would have previous capital project experience and have a working knowledge of basic project management concepts and techniques. This course does not teach fundamental project management skills such as cost estimating, planning, and scheduling but provides a detailed treatment of Best Practices and key learnings from IPA research.
Best Practices for Small Projects is officially registered with PMI, which allows attendees to easily claim 22 PDUs upon completion of the course. Simply visit the PMI Continuing Certification Requirements site and submit the PDU Activity Reporting Form (Provider Number: 2767 / Activity Number: XXXSMP). For those claiming PDUs through other education organizations, please note that the duration of this course is 22 hours.
Contracting in the Changing World of Projects
Contracting in the Changing World of Projects is a 2-day seminar during which knowledge on how contracting approaches and strategy are linked to business value will be shared. Contracting strategy is an important element of any project execution plan. Owners are tasked with selecting appropriate and effective contracting strategies for their capital projects. However, owner teams often lack data and a process to guide this selection. IPA’s contracting research over the past 20 years shows that the misalignment of contracting strategy with project specifics is often the root cause of project failure. In fact, problems with contracting strategies add 20 percent to cost and 18 percent to schedule relative to those projects that make more effective use of contract types.
This program illustrates the results of in-depth IPA research into evaluating, selecting, and developing appropriate and effective contracting strategies for capital projects. The findings presented for discussion in this program are based on the analysis of thousands of projects of various size and type executed around the world. Contracting in the Changing World of Projects is officially registered with PMI, which allows attendees to easily claim 16 PDUs upon completion of the course.
Seminar Content and Organization
The material in Contracting in the Changing World of Projects, which consists of eight separate modules, will be covered in two days. Each module will cover a specific topic with material being presented in a variety of ways. Important research findings will be presented through lectures with supporting presentation material and readings and active class discussions. A case study will be presented that enables the participants to develop a project contracting strategy for a sample project. This exercise includes building a complete contracting matrix for the sample project that addresses all four dimensions of contracting strategy: division of scope, phases included, contract formats, and selection criteria.
The specific course modules for the Contracting in the Changing World of Projects course are as follows:
Instructors provide an overview of the IPA Institute and its link to capital project consultancy and parent company, Independent Project Analysis (IPA), before sharing the purpose of and motivation behind the course: IPA data show that problems with contracting strategies are often the root cause of project failure. An outline of the course modules and learning objectives is presented before sharing important information about IPA’s methodology, databases, and research.
Module 1: Contracting Overview
Contract elements and contracting strategy are clearly defined in the context of capital projects, and the relative importance of contracting strategy in project performance is explained. The four dimensions of contracting strategy (scope division, phases included, contract format, and contractor selection) are presented and will be discussed in detail in later modules. The module concludes with introducing a contracting plan development process that will provide the framework for the case study exercise throughout the course.
Module 2: Starting Point – Project Environment
The purpose of this module is to describe the first step in developing the contracting plan – establishing the project environment: the business and project objectives, the scope of work to be completed for the project, and the current contractor market conditions. This module describes how all of these elements combine to play a role in developing the most appropriate contracting plan. Specifically, data are presented that help the participants recognize the importance of clearly defined business and project objectives as well as the relationship between clear objectives and contracting strategies. This module then outlines how the project scope drives contracting strategy and lists specific considerations. The module ends with a discussion on historical and current markets for contracting services and procurement and how the current market influences the available contracting strategies.
Module 3: Starting Point – Owner Characteristics and Risk Analysis
This module continues the discussion of establishing the project environment regarding the owner characteristics that must be evaluated prior to selecting a contracting strategy and the ways that risk analysis exercises can affect the contracting strategy. The module ends with learning to apply the Owner Characteristics Evaluation Checklist.
Module 4: Developing the Contracting Strategy – FEL, Scope, and Phase
Once the project environment has been clearly defined, the next step is to begin actually developing the contracting plan. This module begins this phase by first describing the basic elements of a stage-gated system and how it intersects with developing the contracting strategy. The module then shifts to the industry practices for contracting, the first phase in the capital project cycle, Front-End Loading (FEL). The roles of owners and contractors during the definition phase are explored. This module provides more detail of the first two dimensions of contracting – selecting how the project scope will be subdivided into different contract tracks and selecting the phases that will be included in specific contracts. IPA’s research findings and issues associated with contractor continuity from FEL into execution are also presented.
Module 5: Developing the Contracting Strategy – Contract Formats
The focus of this module is the third dimension of contracting – contract format. First, basic options that are available for contract formats are identified, followed by a discussion related to the relationships between contract formats and project results based on IPA’s contracting research. Contract incentives and their impact on outcomes are also examined.
Module 6: Developing the Contracting Strategy – Selection Process
The final dimension of contracting, contractor selection, is presented in this module. The module begins with outlining the typical options available to owners for sourcing contractors. IPA’s research on selection criteria is then presented, particularly around why selection based only on low cost leads to poor results. Practices are then provided for owners to effectively implement alliance contracts.
Module 7: Developing the Contracting Strategy: Contracting Project Management and Terms and Conditions (T&Cs)
This module explores two major organization/management issues facing industry: the use of Project Management Contractors (PMCs) to supplement owner teams and alternatives and considerations for construction management (CM). Specifically, risks associated with PMCs are summarized, and strategies that owners can implement to help mitigate those risks are identified. Available contracting models and considerations for CM are also described. In addition, critical T&Cs topics are addressed that owners must get right. A discussion on the concept of risk pricing is then followed by a list of specific strategies that owners can apply to reduce contractor risk premiums.
Module 8: Implementation
The final phase of the contracting plan development process is implementing the contract. Effective implementation includes strong project controls, knowledge of mitigating claims, understanding when termination may be necessary, and items to consider when closing out the contract. Each of these elements of implementation is addressed in this module. Specific project controls Best Practices are provided as well as practices to manage the risk of contractor claims.
Instructors recap the material that has been presented and review scope splits, phases in the contract, contracting format, and contracting selection. Various factors that may affect your level of influence in selecting a contracting strategy are discussed, along with elements to consider when the opportunity for influence exists. Education path forward options are presented before wrapping up with individual participant course evaluations and certificates.
Contracting in the Changing World of Projects will improve the understanding of the relationship between contracting practices and outcomes for those who attend. The contracting program will provide a set of practices and tools that will allow participants to align the contracting strategy, alliance arrangements, and incentive plans with business objectives. Participants will learn how contracting practices affect outcomes. Improved knowledge of the link between contracting strategy and capital effectiveness will allow for better alignment with business needs. Class size will be limited to allow for in-depth discussion of the material presented. Participants will receive presentation slides and appropriate reference and supporting material.
All who consider contracting an important element of success in capital effectiveness will benefit from this program. This program will aid those involved in selecting and implementing contracting strategies and will benefit managers of individual projects who establish the contracting approach for their projects. It will also provide insight to contracting approaches for those who manage the whole project system and look to establish system-wide approaches to contracting.
Contracting in the Changing World of Projects is officially registered with PMI, which allows attendees to easily claim 16 PDUs upon completion of the course. Simply visit the PMI Continuing Certification Requirements site and submit the PDU Activity Reporting Form (Provider Number: 2767 / Activity Number: INS-CON-2). For those claiming PDUs through other education organizations, please note that the duration of this course is 16 hours.