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By John Nita and Luiz Correa, Emerson Process Management
You probably haven’t thought much about it, but each of us applies or is affected by a variety of risk-based assessment methods every day.
We decide where and how to invest savings for our kid’s college education. A traffic light turns yellow and we decide to brake or accelerate. Our health and life insurance premiums are based on an underwriter’s assessment of the risk our current health and lifestyle pose. Before surgery our doctor explains the risks. TV commercials for any number of medicines identify the benefits and side effects. We diversify our retirement investments to minimize the impact of global events.
The benefits associated with risk management is well documented and receiving more and more credibility with each passing day.
For example, in 2001 the U.S. Food and Drug Administration (FDA) began encouraging the life science industry to apply risk-based assessments in determining if new processes and/or technologies can be used to safely produce health care products.
Or consider that for more than two decades, process industry safety experts have been applying risk-based assessments to determine the appropriate level of protection that a safety-instrumented system (SIS) must achieve.
While the rest of the world seems to be relying more and more on risk management, few projects include a formal risk management plan, which is unfortunate because managing risk is what project management is all about.
Among the outmoded thinking that prevents using risk-based assessments as part of project management are:
Changing such perceptions takes time accompanied by celebrated successful projects. A really good first step to change such outmoded thinking is to apply risk management techniques when selecting a project management organization.
Each and every risk assessment model requires identifying the risks or harmful events.
To a process safety expert, too much temperature or too little pressure may represent a safety risk. For each identified risk, these experts seek to answer two questions: “What’s the likelihood the risk will actually occur?” and “What will be the likely consequences?”
Once these questions are answered, the safety experts working in conjunction with process, mechanical, and instrumentation experts, redesign the process or add other forms of protection to reduce the likelihood and/or mitigate the consequences.
The same is true with project management. Certainly an experienced project manager is important, but automation projects are successful because the entire project team – the project manager, engineers, technicians, systems, product support, management commitment, financial resources, and more – performs in harmony.
That’s what’s being referred to when we talk about project management organizations. The presence or absence of all these elements is what determines the quality, depth and suitability of a project management organization.
Certainly organizations exist with really talented lead engineers who are also capable project managers, and for some projects that may be all that’s needed. However, without a risk assessment, users won’t know which project management organization is most experienced and best equipped to mitigate identified project risks.
Meeting that challenge requires users begin by identifying and documenting obvious project risks (events) and then quantifying the likelihood and consequences associated with each of those risks before beginning the project management organization search.
Consider P&IDs (Piping and Instrumentation Diagrams) and detailed process descriptions as two typical project scope items. The risk of not completing these standard inputs for an automation vendor is determined by the likelihood that they are approved for construction by a certain date, and the consequences if they are not. Thus the risk, likelihood and consequences associated with P&IDs and process descriptions is understood, and the information provides for valuable dialogue with candidate project management organizations.
Logistics may also represent an automation system project risk. For example, what if the automation system is to be engineered in the U.S., integrated and tested in Asia, and installed in the Middle East? Such a situation definitely represents a logistical risk that users and candidate project management organizations must discuss.
These are but two examples of possibly hundreds of automation project risks. Eliminating or at least mitigating project risks requires identifying and documenting as many risks as possible before the project launch date. Not only will such an exercise help minimize project risk; it will also serve as a valuable means of evaluating candidate project management organizations.
After automation project risks are identified, quantified, and documented, users are ready to begin evaluating candidate project management organizations.
If asked, we’d all agree there are some things that are essential to every project regardless of project type. If asked to recite what these basic project essentials are, the list would include such things as scheduling, cost containment, scope management and reporting.
As you begin interviewing and evaluating project management organizations you’ll want to understand how each addresses, manages and reports these basic project essentials. While each candidate organization will have a compelling story to share, what you’re seeking is an organization that fits into or can adapt to how your company executes projects. This becomes especially important when the automation project is a sub-project of a larger project and everything is feeding into an overall project schedule.
You’ll also want to examine each candidate’s additional basic project essentials including its tools, techniques and methodologies.
Though the following is not an exhaustive list, it illustrates the breadth of project essentials users should hear and learn about when interviewing candidate project management organizations.
We’ve all heard the “project from hell” horror stories and while these are often humorous to listen to, those who “lived” them didn’t see anything humorous about them at the time.
Doing your homework and examining a candidate organization’s basic project essentials is an excellent beginning to avoid having your own “project from hell” story to tell.
When you’ve completed the evaluation of candidate organization’s basic project essentials, it’s likely some won’t make your short list. For those that do, the next step is to examine what each remaining candidate organization has to offer in the way of advanced project offerings.
Earlier we explained that a project management organization includes the project manager, engineers, technicians, systems, product support, management commitment, financial resources, and more. As you begin to examine the tools, techniques, and methodologies offered by the different candidate project management organizations, several advanced offerings will be engineering oriented while others are best described as being business-related.
Advanced business related project offerings include:
Certainly other business-related project offerings exist, and just because a candidate project management organization doesn’t mention the specific one or two you’re seeking doesn’t mean they don’t know how to provide it. Ask and you may be pleasantly surprised.
Though there is no formal definition of what constitutes an advanced project tool, technique or methodology, a few in the area of engineering that come to mind include:
Certainly this list could be expanded, but you get the idea.
In order for an automation project to have a better than 50/50 chance of success, the basic project essentials described above must be in place. After that, the projects probability of success increases with the addition of project appropriate advanced project offerings.
When stated like that, it seems that ensuring project success is fairly easy to achieve. The problem is no two automation projects are exactly alike. Even “sister plants” that are said to be “exactly” alike, or at least “really quite similar,” never are exactly alike and probably aren’t all that similar. This introduces additional project risks that are most likely to be mitigated by ensuring the basic project essentials are firmly in place and are appropriately augmented with a mix of advanced project offerings. And that’s best achieved through the application of risk management techniques we’ve been discussing.
It’s the diligence you apply to the risk-based assessments that will help decide if a project management organizations basic essentials and advanced project offerings are really well suited to mitigate identified project risks.
So let’s recap: The potential for automation project success greatly increases when users:
Just as you wouldn’t invest your kid’s college fund or your retirement nest egg in a mutual fund without first examining the fund's investment risks and potentials – including the fund manager’s philosophy and track record – you shouldn’t invest your company’s money in a process automation project without first ensuring the project manager, engineers, technicians, systems and product support are experienced and well suited for your specific project. You must also make sure the management commitment and financial resources to support the project are solid and will be available for the life of your system.
John Nita is a senior principal engineer with Emerson Process Management. Over his 10-year career, he has held positions in process engineering, project management, and plant technical and operations management.
Luiz Correa is a project manager with Emerson Process Management. During his 15 years with Emerson, he has held positions in custom hardware engineering, application software engineering, project engineering and project management.
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