LABOR OVERRUNS

As the increase of projected Major Capital Projects for 2017-18 emerge with all its implications troubled projects are a likely result.  LABOR OVERRUNS are a typical component in troubled projects.

LABOR OVERRUNS – impact several project baselines. Cost, Schedule and Progress are at risk.

LABOR OVERRUNS – Labor Overruns are a major risk in any project with a significant labor component.

LABOR OVERRUNS – Early detection, correction and management require use of proper KPI’s.

LABOR OVERRUNS – Use of thoughtful KPI’s facilitate early/proactive corrective action.

LABOR OVERRUNS – Labor Shortages in 2017 and beyond will lead to upward pressure in labor rates.

LABOR OVERRUNS – Labor shortages in 2017 and beyond will lead a man-hour overruns (poor productivity).

McLaughlin & McLaughlin has assisted numerous troubled Major Capital Projects successfully over the years by providing cost effective business solutions and recovery plans.

 

It is important to note that McLaughlin and McLaughlin Project and Dispute Consulting LLC [M&M] is not a law firm and is not intending to provide legal advice.  M&M is a consulting firm providing (among other services) non-legal expertise in construction claims, dispute resolution and litigation support.   For further information on M&M services, please see www.McLaughlinandMcLaughlin.com.

Labor Productivity

Project Professionals a blog by McLaughlin & McLaughlin Project and Dispute Consulting LLC   will be offering a few project tips regarding Project Management and Labor Productivity  over the next few weeks.

Labor Productivity – Productivity Factor (PF) according to #AACEI equals Actual Productivity divided by Baseline or Planned Productivity.

Labor Productivity – Performance Factor (PF), according to Schwartzkoff equals Estimated Unit Rate divided by Actual Rate.

Labor Productivity – A simple KPI is the ratio of Planned Man-Hours divided by Actual man-hours – “Earned over Burned.”

Labor Productivity – There are several KPI’s that can be used for project/construction management.

Labor Productivity – Use of labor productivity KPI facilitates proactive project management.

Labor Productivity – As a leading Indicator, Labor Productivity represents an excellent management tool.

 

It is important to note that McLaughlin and McLaughlin Project and Dispute Consulting LLC [M&M] is not a law firm and is not intending to provide legal advice.  M&M is a consulting firm providing (among other services) non-legal expertise in construction claims, dispute resolution and litigation support.   For further information on M&M services, please see www.McLaughlinandMcLaughlin.com.

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MANAGING RISK OF DELAY – Managing Contractor Schedules (Part 13)

This McLaughlin & McLaughlin post is the thirteenth (13th) in a series  of discussions regarding various aspects of time management as it relates to the risk of delay.  This post addresses managerial considerations for dealing with schedules prepared by contractors and submitted to owners or their agents (construction managers, managing contractors, advisors, etc.).

Recently, Mr. Chris Carson authored an excellent article titledDealing with Contractors Schedules That Cannot be Approved.  This fine article was published in COST Engineering(September/October 2013).

This article contains excellent advice for project teams regarding schedule management.

Mr. Carson’s article is, in reality two articles in one.  While Mr. Carson’s article presents a methodology for problematic situations (which he calls DSAB), the preamble and initial discussion for this article is highly useful and applicable to project management teams as they address the frontend of project planning and execution.  This post summarizes the sage advice provided by Mr. Carson regarding frontend project management challenges as they relate to scheduling and time management. [Read more…]

CONSTRUCTION CLAIMS AND DISPUTES – (Part 1)

This McLaughlin & McLaughlin post is an introduction to an ongoing Subject Series regarding Construction Claims and Disputes in engineering, procurement and construction industry.

OVERVIEW

In relation to construction claims and disputes it is important for all readers, contributors, participants and others regarding the general subject of claims and disputes to be equally informed.  This discussion is directed toward engineering and construction claims and disputes.

In the engineering and construction industry, contract claims and disputes are common issues.  They occur between: owners and contractors (prime), contractors and their subcontractors, contractors and (their) vendors, and at other contractual interfaces.  Resolution of the claims and disputes can be a costly, disruptive and aggravating process for all parties.

[Read more…]

PROJECT MANAGEMENT CHALLENGES– Subject Series Summary

Having recently addressed the AACE International Western Winter Workshop, I am heading for Canada on a new consulting engagement.  Likely, we will have some additional posts and details at a later time.  The press of business has reduced our recent posting activity.  Given this trend and  the large number of new visitors to this blog, we will repost some of the Subject Series Summaries.

This  McLaughlin & McLaughlins Project Professionals summary update provides readers with an overview of prior posts and provides a baseline for future posts that will follow on a timely basis.  This Subject Series, PROJECT MANAGEMENT CHALLENGES was posted during June through September 2011.  Since that time, blog readership has increased significantly.

This summary is very brief and simply serves as an index for readers to follow.  More robust summaries are provided in the June summary.  Of course, detailed descriptions are contained in the individual posts.

Ideally this Subject Series provides a starting point to investigate best practice on many planning and execution features of project management.

Introduction (Part 1) – This post is the first in a series of discussions regarding challenges being encountered in current project management.  This post introduces the topic and sets the framework for ongoing posts on individual challenges.  This series is intended to draw upon many sources within the project management discipline or profession.

Project Initiation (Part 2) – This post addresses the starting point or initiation of the project.  This is a crucial challenge.  The initiation process (getting started formally) requires two processes and deliverables/outputs (see PMBOK® and Kerzner).  Both processes are discussed.

Project Initiation Lessons Learned (Part 3) – This post addresses the starting point or initiation of the project.  The study of lessons learned creates relevance and importance in (sometimes) abstract concepts.  It answers queries regarding the practical side of the issue.  There is a famous quote out there that talks about those that refuse to study history.  It is suggested that you avoid reliving the mistakes experienced by others.

Project Planning Process (Part 4) – This post addresses the project planning process.  This is a crucial challenge and the importance of this process cannot be overstated.  A logical and often asked question is along the lines of “Why plan?” as it can be complicated, time-consuming and aggravating.  There are several key benefits to planning.  These benefits are discussed.

Project Management Plan (Part 5) – This post addresses the Project Management Plan [also known as Project Execution Plan, Project Plan and other titles].  The Project Management Plan can consist of several pages of information and direction or a bookshelf full of many volumes of documents.  These many volumes can have a hierarchical structure.  PMBOK® provides guidance regarding this deliverable/work product.  The Project Management Plan is also known as Project Execution Plan, Project Plan, and other similar titles.

Project Planning Issues (Part 6) – Planning the project properly, documenting the plan professionally and then implementing the plan successfully are likely the source of most project success and failure outcomes.  While project planning is one of the most fundamental skill sets in project management, the requisite processes and actions are not well developed or successfully implemented.

Project Planning Lessons Learned (Part 7) – Learning from the experiences of others is an effective method for skill set development.  Many organizations that use project management on an ongoing basis close out projects with a compilation of “lessons learned.”  These firms have found value in studying the issues that have emerged in the past.

Project Planning Lessons Learned STAKEHOLDER MANAGEMENT (Part 8) – This post continues the focus on issues in planning and problems that have their source or root cause in planning.  The subject is Stakeholder Management.  The use of team and stakeholder workshops can be an effective mechanism for aligning, selling and implementing the Project Management Plan.  Obtain an audience with all stakeholders.  Start with the Project Sponsor.  Sell the Project Management Plan in detail.

Project Planning Lessons Learned RESOURCE REQUIREMENTS (Part 9) – This post continues the focus on issues in planning and problems that have their source or root cause in planning.  The subject is Resource Requirements.  In this regard, the post will focus on human resources or staffing. [Read more…]

RESOURCE CENTER UPGRADE

The purpose of this post is to advise readers that the Project Professionals Resource Center feature or page has been upgraded.  Please visit this useful page and familiarize yourself with the content.  Please visit the Resource Links page which provides links to useful industry tools and resources.  The pages were derived from years of frustration searching for reliable, substantiated references.  So, the desires to share our choices are listed on the noted pages.

The Resource Center feature of this McLaughlin and McLaughlin [M&M] blog provides blog visitors with information and links to important and useful publications that relate to project management and dispute resolution in project work.

Recently, the Resource Center was upgraded to include several new publications, cite a new version of Mr. Pickavance’s book on delay and add some useful Resource Link updates. [Read more…]

PROJECT MANAGEMENT CHALLENGES – Project Planning Issues (Part 6)

Planning the project properly, documenting the plan professionally and then implementing the plan successfully are likely the source of most project success and failure outcomes.  While project planning is one of the most fundamental skill sets in project management, the requisite processes and actions are not well developed or successfully implemented.  There is value in the planning process and value in implementing a well documented plan.  This was discussed in the prior post in this Subject Series.

Learning from the experiences of others is an effective method for skill set development.  Many organizations that use project management on an ongoing basis close out projects with a compilation of “lessons learned.”  These firms have found value in studying the issues that have emerged in the past.

This and several following posts focus on issues in planning and problems that have their source or root cause in planning. [Read more…]

PROJECT MANAGEMENT CHALLENGES – Project Management Plan (Part 5)

This post is the fifth in a series of discussions regarding current challenges being encountered in today’s project management.  More specifically, we have titled the series PROJECT MANAGEMENT CHALLENGES, since we intend to focus heavily on the managerial aspects of program / project management.  This post addresses the Project Management Plan [also known as Project Execution Plan, Project Plan and other titles].  The last post (Part 4) addressed the project planning process.

Authoritative information and guidance regarding project management comes from many sources.  A few that may be obvious include:

In order to frame and organize this topic, we are using the PMI Project Management Processes for a Project as presented in A Guide to the Project Management Body of Knowledge (PMBOK® Guide).

Many discussion groups and forums can be helpful.  These include AACE, PMI, LinkedIn and others. [Read more…]

Labor Productivity and Disruption – Managerial Considerations

This is the seventh posting regarding labor productivity and disruption. The Subject Series can be viewed here.  In large and complex projects, a prime contractor may or may not direct hire the field labor.  Often, the field labor is hired by major subcontractors (contractors hired by prime contractor).  Examples are civil, structural steel, mechanical, piping, electrical and controls.

For the prime contractor [or similarly for Owner/Employer], subcontractor productivity is seemingly not important or relevant.  This is particularly true if the subcontractor in question is on a fixed price or fixed unit price contract.  However, events that are created by Owner/Employer or Contractor that impact the subcontractor’s productivity create potential liabilities.  Further, once the subcontractor discovers the loss, a claim is likely to emerge.

Consequently, positive action is needed.  There is a legitimate need for the Owner/Employer and Contractor to be informed.  Managerial overlay, visibility and attention are components in the overall project management challenge. [Read more…]

Managing Risk Of Delay – Earned Value Management (Part 5)

This post is the fifth in a series of discussions regarding various aspects of time management.  More specifically, we have titled the series MANAGING RISK OF DELAY, since we focus heavily on the managerial aspects of program / project management.  This post addresses some ideas regarding preparation and maintenance of time management related to overall bulk progress.  Some might refer to this as Earned Value Management.

The challenge associated with managing all (critical and non-critical path) work is common to virtually all Lump Sum Turn Key (LSTK), Engineer Procure Construct (EPC) and other similarly executed projects.  In addition to the normal issues associated with bulk progress, actions or inactions by the owner can add considerable complexity to this challenge.  Owner/Employer delays can be masked among the myriad of activities that are the responsibility of other (than the Owner/Employer) stakeholders.  Even when detected or disclosed, these variances to plan are often dismissed as simply consuming available float.  Hence, the Owner/Employer (or other stakeholder) may rationalize these variations as having no impact.  Of course, the reality is that these sorts of departures may (or may not) add risk or disruption to the project execution.  Further, they may delay forecasted completion.  The managerial challenge becomes detection, assessment and quantification (should it be appropriate to compensate the contractor for the impacts). [Read more…]