Transcript
Page 1: Optimizing EPC Project Delivery With 4D Experience

| 1Copyright 2014 | © E2C Bridge Proprietary Information

Optimizing EPC Project Delivery With “4D” Experience 3DS Conference- EPU Track

Nov 12 2014

Dr Yasser Alkazzaz

Founder & CEO

E2C Bridge

[email protected]

+1 817 253 4129

Design Reality

Project Delivery Optimization

Page 2: Optimizing EPC Project Delivery With 4D Experience

| 2Copyright 2014 | © E2C Bridge Proprietary Information

Agenda

• Introduction & Background

• Project Delivery Challenges & Opportunities

• New Approach to Project Delivery Optimization: “4D Experience”

E2C Bridge Solution and Services

Optimized Plant Construction

• Advantage and Benefits

Key Functional Advantage and Improvement

Potential Financial Saving and Benefits

Page 3: Optimizing EPC Project Delivery With 4D Experience

| 3Copyright 2014 | © E2C Bridge Proprietary Information

Project Delivery Is About Mobilizing Capital to Transform

Engineering Design Into Reality Upon A defined Schedule

EngineeringConstruction &

Installation

Design Completion

Budgeting & Scheduling

Work Packages (Materials/Contracts)

Project WBS, BOM

Engineering Documentations

Project Delivery

Procurement & Materials Management

In project delivery any issue, error, delay can directly and simultaneously

impacts cost and schedule performance

Page 4: Optimizing EPC Project Delivery With 4D Experience

| 4Copyright 2014 | © E2C Bridge Proprietary Information

Capital Projects Aren’t Delivered On Time and On Budget

Leading to Hundreds Billions Value leaks Across Industries

• Errors in planning leading to rework account for 15% of cost and up to

40% decrease in construction productivity

• In one single capital project 70% of labor cost is spent on inter and intra-

company interactions leading to decreased overall EPCM productivity

• Poor materials management & delivery could cause

7% increase in materials cost,

16% increase in project delays and

24% decrease in construction productivity

and 75% behind schedule Cycle Time

Cost

63% of projects over budget

ConstructionEngineering

LogisticsFabrication / Expediting Purchasing Requisitions WarehousingQuality Surveillance

Page 5: Optimizing EPC Project Delivery With 4D Experience

| 5Copyright 2014 | © E2C Bridge Proprietary Information

Projects Delivery Does Not Effectively Bridge Engineering

With Construction Leading to Poor Project Performance

Project controls & materials management still suffer from being separated,

suboptimal, lacking power and some time not impartial

Islands of data with “Ad Hoc” integration causing leak and inconsistency and

preventing analysis and evaluation of construction alternative

Lack of portfolio standardization and globalization (project per project basis)

Lack of global portfolio consistency (process, resources, and contractors)

preventing effective knowledge transfer and development

Owner/EPC/EPCM relationship requires improvement in both sides.

Logistics

and 75% behind schedule

Cycle Time

Cost

63% of projects over budget

Fabrication/ Expediting Purchasing Requisitions Warehousing

ConstructionEngineering

Quality Surveillance

Page 6: Optimizing EPC Project Delivery With 4D Experience

| 6Copyright 2014 | © E2C Bridge Proprietary Information

E2C Bridge Integrates Project Planning & Controls With Procurement and

Material Management into Effective Project Delivery Process Framework.

Engineering Construction

Project Delivery Optimization

E2C Bridge

Procurement &

Integrated Materials Management

Process

Framework

On DemandRemote &

Central

Lean

Methodology

4D

Controls

One Stop

Shop

Concurrent

Scheduling

Delivery

Methodology

One Stop Shop Integrated Services

Concurrent versus sequential planning &

scheduling continuously aligning schedule,

cost and materials with construction

Integrated materials management process

from engineering specification all the way to

installation

On demand, central & remote approach

facilitating set up and driving process

consistency & alignment

Page 7: Optimizing EPC Project Delivery With 4D Experience

| 7Copyright 2014 | © E2C Bridge Proprietary Information

E2C Bridge Consulting and Service Capabilities Are Defined to

Drive Optimization & Integration Through The Project Lifecycle

Option selected Baselines Complete.

Definition, PlanningInception, Identification Execution

CONSULTING SERVICES MANAGED SERVICES

Project & Portfolio Strategy

Portfolio Optimization• Design Standardization

• Contracting Framework

Agreement

• Process and IT

• Resource and Knowledge

management

Project Delivery Strategy

IT Systems Strategy

Project Planning

Work packaging

Modularization Study

Project Scheduling

Project Budgeting

Procurement Planning

Logistics Optimization

Sourcing Optimization

Project Controls

Cost & schedule control

Change management

Progress reporting

Performance management

Materials Management

Requisitioning & bidding

Purchasing

Expediting

Vendor quality Surveillance

Logistics

Site receiving

Page 8: Optimizing EPC Project Delivery With 4D Experience

| 8Copyright 2014 | © E2C Bridge Proprietary Information

E2C Bridge Project Delivery Framework Integrates Schedule With

Materials and 3D Design to Offer Highly Effective 4D Controls Approach

Cost Controls

Schedule Actual Dates

Actual Delivery

Dates

CommitmentsBudget

Estimate

Quality

SurveillanceLogistics

Project

Engineering

Data

BOMPackages

RequisitionsPurchasing Expediting

Site

Construction

3D Design

4D Simulation & VisualizationEngineering, Procurement and Construction

Material Elements

Planned Due Dates

Due Dates

Budget Allocation

Page 9: Optimizing EPC Project Delivery With 4D Experience

| 9Copyright 2014 | © E2C Bridge Proprietary Information

IT Still Is Best of Breed Lacking Integration, Alignment And

Key Elements to Address Critical Functional Gaps

Engineering

Data

Management Project Document Management

Materials Procurement & Contracts

Construction & Site Management

Project Planning & Control

Commissioning

Project Data Management

En

g D

esig

n T

oo

ls

Publish

Eng

Information

Project management

Project Portfolio Management Data Analytics, Reporting, Benchmarking & Performance Management

Project Portal Pro

ject P

rocess M

anagem

ent

Contract

Management

Capital

Estimating

EPCM

EstimateCost ControlScheduling

EPCM

Progress

Risk

Mgmt

Quality

Mgmt

Reporting

Dashboard

Safety

Mgmt

Project Admin,

CollaborationResource

Management

Purchasing

Hand Over

Expediting LogisticsSite Materials

ControlsInspection

In House/custom

Missing/Not deployed/AdHoc

Best of breed

Engineering focused

Owner

Operations

Page 10: Optimizing EPC Project Delivery With 4D Experience

| 10Copyright 2014 | © E2C Bridge Proprietary Information

E2C Bridge Has Chosen “Optimized Plant Construction”

To Support Its Approach and Process Framework

2

4

5

3

Construction Field

Planning & ExecutionLean Construction Execution

Engineering Work Package Digital engineering management

from plan, execution, approval to

change

Collaborative Digital ProcurementProductivity for requisitioning & manage

procurement lifecycle

Requirements Driven

Project Management & MonitoringProject management & execution integrated with

Quality Management System

6

Virtual Construction

4D SimulationConstruction plan optimization &

validation

3D Construction Instructions Intuitive work instruction for safety,

quality & efficiency

1

Page 11: Optimizing EPC Project Delivery With 4D Experience

| 11Copyright 2014 | © E2C Bridge Proprietary Information

OPC 4D Approach Facilitates The Application of Lean

Principles And Optimizes Project Controls & Delivery

• Simulation & Validation Proactive Vs Reactive

Redefining project controls from passively monitoring results to proactively influencing

and ensuring predictable project outcomes.

• Integration & Visibility Global Optimization Vs Local Optimization

Redefining performance improvement by maximizing value and minimizing waste at

the project level versus locally optimizing each individual activity.

• 4D Virtual Construction Concurrent Vs Sequential Engineering

Redefining Project Delivery from sequential engineering and construction

to simultaneous design of the facility and its construction process.

• 3D Instructions & Training Pull Vs Push

Coordinating action through pulling and continuous flow of information as opposed to

traditional, central authority driven push

Decentralizing decision making through transparency and empowerment by providing

project participants with information on the state of projects and empowering them to

take action.

Page 12: Optimizing EPC Project Delivery With 4D Experience

| 12Copyright 2014 | © E2C Bridge Proprietary Information

E2C Bridge Estimates Potential Saving From Project

Delivery Optimization to 10% of CAPEX at A Minimum

% of CAPEXHistorical

ratios

% of

EPCM

$1BProject

Potential Saving

EPCM Fees 10% 100% $100M % of Saving Saving

Engineering Design 3% 30% $30M 5% $1.5M

Engineering Detail 5% 50% $50M 20% $10M

Materials &

Procurement

Management

1% 10% $10M 20% $2M

Project Controls 0.3% 3% $3M 20% $0.6M

Project &

Construction

Management

0.7% 7% $7M 20% $1.4M

Equipment 25% N/A $250M 1% $2.5M

Bulk Materials 30% N/A $300M 3% $9M

Construction Labor 35% N/A $350M 24% $86.4M

Total $1000M $113.4M

• Optimizing Project Controls, Procurement & Material Management, which represents only

1.3% of CAPEX can produce significant saving across the entire CAPEX

• Standardization Can Produce Much Larger Across The Project Portfolio

Bonus

Bonus

Bonus

Standardization

Page 13: Optimizing EPC Project Delivery With 4D Experience

| 13Copyright 2014 | © E2C Bridge Proprietary Information

Define/Plan Execute Operate

Also, 4D Approach Could Result in Schedule Compression

Up to 15% And Significant Increase In ROCE

Increase

Decision Quality & SpeedStreamline Execution

Pull in

production date

Increase ROCE

Delays in

production date

postpone and

decrease ROCE

15% Schedule

Compression

Planned Completion

Page 14: Optimizing EPC Project Delivery With 4D Experience

| 14Copyright 2014 | © E2C Bridge Proprietary Information

Our Contacts & Information

Dr Yasser Alkazzaz

Founder E2C Bridge

[email protected]

Mobil +1 817 253 4129

About the Presenter

Dr Yasser Alkazzaz is Founder & CEO at E2C Bridge. He has over 26 years of leadership experience in both capital projects & industrial

operations environments. Previously he was global director at Hatch engineering consulting and project implementation and held executive and

management consulting positions in USA and Europe at PWC's PRTM, i2 Technologies and ORTEMS a company he co-founded in Europe on the

basis of his PhD research in the area of manufacturing control planning and scheduling.

Dr Alkazzaz passion is about solving complex industry and business problem by applying innovation in technology and process methodology

including best practice transfer in between industries. He has several contributions in both academic and industry arenas.

Dr Alkazzaz hold a PhD in Industrial control applied to manufacturing planning and scheduling and two masters of industrial engineering

and automatic control


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