Dilemma

How can a project owner test a variety of scenarios to choose the best possible outcome to make a project more predictable?

A VARIETY OF SCENARIOS
Advanced management & Project management
Advanced management

Solution

An innovative concept, based on two decades of scientific research and build on project dynamics and peoples behaviors in highly complex engineered projects, is able to do just that: Test a variety of scenarios for the best possible project results, far in advance of any execution.

A concept which enables a project organization, by means of analytics, to quantify the outcome of any work as a derivative of the executing organization. These results are obtained after filling out key characteristics of the organization and related project set-up, and simulate the outcome of schedule and costs, based on multiple scenarios and resulting in a yield of multiple times the costs of it.

 

various PUBLICATIONS Organizational aspects

Added value

The availability of such a model makes it possible for a project owner to see how key work processes are set up. Besides that, it shows how to reduce rework and decision wait time through changes in work sequencing and supplemental staffing. Potential changes with related cash flow forecasts, are quantified before actual changes can be made in the field, giving leaders. greater confidence to act decisively in implementation. All resulting in, among others: very accurate prediction of schedule, quality performance and cash flows. Another main advantage is the opportunity to share these project issues, far in advance of any execution, with all parties involved to get more insight in each other’s problems.

tests with related results Companies who used this concept Additional services
Advanced management

Companies who hired us

Vopak
BAM
spie
Vitol
tata steel
van oord
visser en smit hanab
port of amsterdam
Iv-group
IHC Merwede
gemeente utrecht
HES Rotterdam
Driver Trett
Danieli Corus
ProRail
Bluewater
Schiphol Group
Aram Knowledge Partners

Q&A

Who developed the model and for what reason?

The model was developed by a group of researchers from Stanford University. They were asked by the US Department of Defense (DoD) to come up with a model which could support them with their ‘Make or Buy’ decisions.

What makes this model so special?

The model is built on project dynamics (interaction) and people behaviors in highly complex engineered projects. It links the organisation with the work by quantifying the consequences of human behavior on the work. Examples of this human behavior can be embedded in questions like:

  • When is the best moment to run this model to get the highest yield?
  • Whose activities needs the most attention.
  • What is the effect of a poor performing contractor on the duration of a project?
  • Which competences are needed to increase the efficiency of a project?
  • How much time needs to be spent on rework to comply with requested quality?
  • What are the influences of indirect work, i.e. rework, information exchange and decisions making, on the scheduled finish date?
How does this model distinguish itself from planning software such as Primavera or Microsoft Project?

The main differences between the model & planning software are:

  • The developers of the model used the Lean methodology to define a great number of subjects – human behavior characteristics- which enables any project to be more predictable.
  • The model links the organization with the work
  • The model uses a database with validated settings of human behavior characteristics
  • The model generates outcomes by means of algorithms
  • The model uses standardized settings based on validated data
  • In comparison with planning software, this model does not stack bricks but use statistics to quantify correlations (interrelations) between used characteristics and their consequences on the activities of the work.
  • The model can test a variety of scenarios within a short period of time (in line with Scrum methodology, but faster and more complete).
What is the difference between a common risk analysis and the analysis embedded within the model?

Research and the accuracy rate of the results show that organizational risks have a significantly higher influence on duration, quality aspects and costs of a project than any other risk.

What is the added value of the model?

The added value of the model is:

  • A standardized approach
  • A concept which focus on human behavior
  • Use of validated data
  • The accuracy of its outcomes
  • Steep learning curve for participating parties
  • A concept which places minimal time demands on a project team
How long does it take to get results from using the concept of simulation?

With data available, it takes 2 to 4 weeks to get first results. A complete sequence will take 7 to 12 weeks.

What does it need to run a simulation?
  • One liaison person
  • Org chart (optional)
  • Meeting schedule (optional)
  • Schedule (level 2/3), with related budget, broken down per discipline or a     -so called- resource loaded schedule
  • A couple of hours of your time
What kind of variables on human characteristics are used and how are they collected?

Settings of various characteristics which influence organizational risks, are defined by means of an online questionnaire. These characteristics touch topics on:

  • Organization: Emphasize on activities to be executed in sequence or in parallel?
  • Leadership and Policy: Emphasis on controlling or facilitating?
  • Tasks and Work processes: Emphasis what need to be done or how it need to be done?
  • Information exchange: A structured, or informal information exchange?
  • Changing environment: Focus on known, or latent risks?
Why is this concept not widely used within the industry?

Reason of limit use of this concept reach a point of guessing. Most likely reasons are:

  • Use of the concept is seen as an innovation which is not known as a proven concept.
  • Ownership for using this concept is laid at the door of middle management where there is hardly time to study the added value.
  • The concept is seen as to much time consuming for the project team
  • Use of the concept is seen as a tool, and as a consequence: to complicated.
  • “People are risk-averse and in general, to opportunistic when predicting (project) results”; Nobel winning author D. Kahneman.
  • Project managers are the opinion that they can match algorithms and the calculation speed of a computer and can come up with the same results.
  • The outcomes of the model are felt as a threat by project directors and project managers.
  • It is a non-technical approach with a complicated concept
What does this model add in comparison with common methodologies like Lean Six Sigma?

The model differs from common methodologies because:

  • It uses a set of predefined (standardized approach) characteristics.
  • Related settings are collected via an online questionnaire which takes on average 6 minutes to fill in.
  • Mitigating measures are defined by the project team.
  • Outcomes of these mitigating measures can be tested in a safe environment within a very short time.
What kind of software is used for this model?

The model is set up as agent-based software, off-the-shelf available and with no necessary scripting. The software rights were sold by Stanford to an US-based consultancy firm. They validated the embedded data base and patented the software under the commercial name SimVision®.

What are the biggest achievements (limited to results with involvement of AMPS Delft)

Quantified achievements with involvement by AMPS Delft are, amongst others:

  • Civil Industry: 90% reliability of outcomes on the analysis of the tender phase of four Dutch Public Private Partnership projects.
  • Mining Industry: 7,5% Capex reduction via efficiency measures on all project phases. From Design, Procurement to Construction and Commissioning. (APLNG)
  • Civil Industry: 25% acceleration of construction time of land tunnel (anonymized)
  • Shipbuilding Industry: 20% acceleration of new build construction time (anonymized)
  • Heavy Industry: As part of large refurbishment program, significant reduction of Start-Up time of their Cold Mill; from 4 weeks to less then 1 week (Tata Steel – Europe)
What do we deliver?

We deliver:

Insight into the dynamics of an organization. Experiences show that most of the time, the cause of major risks on a project, are not limited to one party. Being able to quantify the biggest major risks, allows project parties to get a better insight in one’s risks without reallocating the ownership of those risks and provide a better understanding between all parties involved.

A Decision Support Report which mention: what we did, why we did it and the results of our analysis.

On request we sent you a 22 p. brochure how this report looks like. The report is compiled from various cases; a number are anonymous projects to safeguard privacy, others are explained in more detail and some cases can be found in the public domain and mention a link to a website.

The report starts with an overview of quantitative results of various scenarios, followed by a Table of Contents with the main subjects: Preliminary analysis, Quantitative analysis and Results & Recommendations. Three attachments are added to explain some of the definitions used, as well as the computational model. A number of reports generated by the model are also made available. The report concludes with a reference list.

What does it cost to model?

There is no direct answer to this question because it very much depends on what needs to be done. Besides that, we have enough confidence in what we deliver, that we are willing to take a risk on our own advice. For that reason, our fee depends on the kind of agreement which is decided upon: a fee against a fixed price, a performance fee, or a mix of the both.

At what phase do organizations call us for support?

Organizations call us at any phase of a project but most of the time when they want to improve the predictability of their project in respect of, amongst others: Contract strategies, Robustness of schedule, Accelerations of the work, Schedule Recoveries, but ultimately, the effect on their Cash flow.