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Transforming Historical Project Data into Useful Information

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  1. Transforming Historical Project Data into Useful Information Presented byTodd Pickett, CCC and Bruce Elliott, CCCConquest Consulting Group

  2. Introduction • Examining history helps improve performance • Use of project historical data will help your company get a competitive edge • Good strategic business decisions • Choosing projects that are right (or wrong) for your company • Problem - few companies have the right systems in place

  3. Historical Project Data CollectionWhere We Are and Why Loss of Expertise • Many layoffs due to canceled projects • Owners unwilling to commit capital to retain experts • Newly hired personnel not fully developed or trained • Old guard moved on to other jobs or retired

  4. Historical Project Data CollectionWhere We Are and Why Loss of Data • Owners apathetic • Work subcontracted to those with no vested interest in data retention • Poor project process leading to poor control and data collection • Poor (or no) methodologies, procedures, or systems in place

  5. Current State • Business boom in capital projects driven primarily by energy sector • Major expansion occurring in O&G • Over $100 billion (U.S) in Alberta • Over $1 trillion (U.S.) in gulf region

  6. Current State • Major cost overruns due to many reasons • Lack of good processes and procedures • Lack of skilled resources • Lack of historical data from past ¼ century • Owners realizing need for up front project analysis for benchmarking and validation • Payback time

  7. Prerequisites for Data Collection • Management Support • For obtaining funding • For recruitment and hiring • To encourage participation • Trained and dedicated staff of professionals • Infrastructure • Communications tools • Computer applications • Network capabilities

  8. Prerequisites for Data Collection • Code of Account • A structured, coded index of project cost, resource, and activity categories • When properly designed it will clarify and reduce confusion • All codes must be clearly defined and easily understood by project personnel • Assigned to each element of the project for the purposes of finding, sorting, compiling and summarizing

  9. Prerequisites for Data Collection • Cost Control System • Provides a means for capturing and storing actual project costs • Pure accounting systems are not useful for capture of appropriate historical data • Must be capable of collecting and reporting costs in a code of accounts format

  10. Prerequisite for Data Collection • Project Classification • A method of categorizing projects by the various types • Ensures that only like projects are analyzed and compared

  11. Data Collection Form

  12. Data Collection - Normalization Reduces inconsistencies in your data by: • Eliminating unusable projects • Due to bad accounting / project controls • Small project • Direct purchase • Create consistent units of cost • Make year of data collection consistent by escalating project costs

  13. Implementing a Historical Project Database System • Goal is to collect data and translate into a strong knowledge base • Putting in place this system will enable: • Cost estimate validation • Creation of benchmark metrics • Aiding of estimate database calibration • Strategic level estimates • Strategic level schedules

  14. Choosing the Right System • Purchased system • Limited availability • One example is Eos Advisor • Spreadsheets • Most popular option but with limitations • Developed Software • Requires lots of time, effort, and commitment • Requires software developer • Most costly option

  15. Using Experts to Implement • System development experts can: • Aid in determining appropriate requirements • Offer enhanced specification writing • Provide software development experts • Expert data analysis to understand, interpret, organize, and filter • Experienced decision makers • Shortened implementation time • Training experts

  16. Using Your New System • Primary goal of your new system is to user your historical data as a knowledge base to help improve practices in: • Estimating • Cost control • Strategic estimating and scheduling • Standard project process

  17. Using Your System Benchmarking • Will be an invaluable aid for estimate reviews and validations by providing: • Benchmark Data • Metrics • Factors • Can store external data for comparisons • Reports…

  18. Using Your System • Database Calibration • Provides a check of estimating database unit costs • Identifies cost trends versus spikes • Can be especially useful during times when labor and material costs are volatile

  19. Using Your System • Strategic Estimating and Scheduling • Use equipment related data and associated metrics to quickly generate estimates • Minimal engineering input required • Strategic Project Planning • Apply lessons learned to front end planning sessions for control of future projects • Help determine future staffing needs

  20. Conclusion • Create a standardized method of examining the past to learn from previous mistakes and to draw on examples of good results • Remember – Improvement is the goal!

  21. Questions? Todd Pickett, CCC (585) 747-5599 tpickett@ccg-estimating.com Bruce Elliott, CCC (585) 943-2823 belliott@ccg-estimating.com