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New Online Course: Fundamentals of Capital Project Cost Control

  • By: pcadmin on 15 Apr 2016

Project budgets can vary from $5,000 to whatever size a company can handle. The problem companies have with capital projects is how to allocate the scarce resource (money) to the maximum benefit of the company. Some factors that go into choosing which projects get done include what the competition is doing, the company’s long-range plans, return on investment (ROI), and risk. ROI is critical to making a decision, as a company is only going to undertake a project if it can make a return on its money by doing it. Think of all the projects you know about that were over budget. What affect did that have on the ROI and did it add value, or cost the company money?

As you know, it is very important to keep a project on track and within budget. It is imperative that costs be controlled during all phases of a project, and you can only control costs if you know what goes into making up the total project budget. You have to set up a project so that costs can be easily identified and controlled.

Project cost control is a lot of work and requires a team effort. In theory, project cost control sounds easy but it is a lot more difficult to put into practice, especially if basic financial information is not correct.

Sign up for this course today and learn the fundamentals of capital cost control for your project.

New Video - Strategic Career Planning for PMs: Position Yourself to be Tomorrow's Leader

  • By: pcadmin on 13 Apr 2016

Recent changes to PMI's standards and certification paths mirror changes business leaders want to see in their project managers. These changes are not random, however, they fit along an evolutionary roadmap. Supported by compelling research, this presentation will show you the emerging pattern and projects it forward to show you what skills project managers will need to get ahead of the crowd and position themselves to be the the leaders of tomorrow.

This new video is presented by Procept senior consultant Kevin Aguanno during the first ProjectTalks event in Toronto, April 5, 2016.

New Online Course: Entrepreneurial Thinking and Customer Management

  • By: pcadmin on 13 Apr 2016

Entrepreneurs naturally tend to gravitate to product development and in the process can overlook the benefits and minimize the challenges of consistent and comprehensive customer management. This new self-paced e-learning course looks to apply to the discipline of customer management the same elements of entrepreneurial thinking that are commonly applied to product innovation.

This unique course examines the benefits of comprehensive customer management through the use of five case studies involving ancient Roman entrepreneurs. Four of the five entrepreneurs achieved great success by focusing their talents for innovation on the customer more so than their products. Each case study presented will analyze the ancient businessperson’s approach to dealing with their customers and insights gained will be extrapolated to the modern business world. At the conclusion of every module, participants will be tasked with applying the lessons learned to a modern market situation.

Customer management demands much more than a tweet, an apologetic email, text, or a posted press release on the home page of a supplier’s website – good customer management requires the ongoing application of entrepreneurial thinking. Study this course to learn ancient techniques that can be applied to today's business world.

New Online Course Launched: Contract Management for Field Personnel

  • By: pcadmin on 13 Apr 2016

Each project is different in the way field contracts are managed. Sometimes there is a dedicated contract administrator, other times it is a field engineer who has to manage the contract and still others it is the construction manager or the project manager. On a daily basis they have to make decisions to act or not to act. These decisions could materially affect the Contractor, the Owner, and others.

In the end, no matter who is managing the contract, the same contract management activities apply and the field personnel require knowledge of these activities. Knowing these activities will go a long way in minimizing claims during the contract management process as well as lessening problems in the field.

This new 12-hour self-paced e-learning course looks at 16 different activities associated with managing a field contract. Each of the 16 activities is important to the whole effort of managing the contract. If you leave out one, the whole contract management effort falls apart.

Hidden Contracts

  • By: pcadmin on 10 Apr 2016

by Morley Selver, P.Eng., IPMA-B

They Want How Much?

We were in the process of buying the electrical equipment for a new plant when the electrical engineer came in with the bad news. They had been told by the electric utility the project would have to buy the transformer from the utility company. We could understand hooking up the transformer, but to actually have to buy the transformer was crazy, which we told him in no uncertain terms! The transformer we needed cost $750,000 from our preferred supplier, while the utility wanted $1,250,000 for basically the same thing. They put a few bells and whistles on it but the cheaper version would work just as well. Was there any way around this? Apparently not. It was the law in this jurisdiction. So just like we were, $500,000 over budget. Unfortunately this scenario is all too familiar and is just one example of what I call “hidden contracts”. These are contracts your company has with outside suppliers / agencies / government bodies that you are not usually aware of until the bill comes in.

Utilities are just one of those hidden contracts. Whenever you are tying in to a government service, such as water, there are strict standards that have to be followed as well as a cost associated with them. You always have to check and see who has to do the actual work, your contractor or the city employees. If the city has to do it, you now have schedule and coordination issues. There are specifications you will need to follow and they will be different than the industrial ones you are using. In some cases your engineers may not understand what they are. The utilities you are typically associated with are power, potable water, sewer, natural gas, and fire water. Always be prepared to question any utility hook ups you require as the cost and schedule can have an important affect on your project.

18 Months? Are You Kidding Me?

Another hidden contract is permits. It seems that no matter how hard you try there are more permits than you have allowed for. There is nothing you can do about the costs, your project has to cover them. There always seems to be confusion as to what is required as the different stakeholders have their own interpretations of the regulation. As with most government regulations they are written in an ambiguous manner and are open to interpretation.

We were looking at adding a fire pump out on a dock in the ocean and we required 12 permits. One of them was an environmental permit and the schedule was 18 months to get it. One other permit prohibited the dumping of fresh water into the ocean! What did they think happened to all the fresh water from the rivers flowing into the ocean? There are times when the permitting process is just not worth the cost nor the aggravation. In this case the fire pump project did not proceed.

I’ve Been Working On The Railroad

Sometimes the requirements do not come from a government organization but a private company. If you have to work with the railways you will have to follow their requirements and seek their permission in order to work on or near their tracks /right of way. Even if your company owns the track in your plant, if you need the railway to bring their locomotives on your site, the tracks have to be up to their standards. Their requirements are going to be a lot stricter than what you are used to.

You Need A Permit For That?

As you are probably aware, permits are not standard across jurisdictions. Every province, state, country have their own permits and it is up to you to find out what is required. This means you will have to depend on local personnel to help in identifying what permits are required. In California we had to bring in the building inspector to count the screws in the drywall before we could tape and mud the joints. I had never heard of it before and if my on site structural inspector had not been aware of it we would have had to do a lot of rework.

Here are some permits that I have had to get at one time or another. Some of these you are familiar with and others probably not. Your project has to have funds to cover the cost of all the permits so you need a handle on what permits are required. You have to know what permits are needed before you can start construction work and what permits need to be signed off or obtained to startup equipment or occupy a building.

  • Building permits; no problem with these. You pay your money up front based on what you know at the time and adjust it later when you know the true cost.
  • Environmental permits; there are all kinds and schedule is usually the bigger concern than cost. Permits that can get expensive are ones that need environmental modeling or hearings.
  • Electrical permits; there are the usual electrical inspections required as the work progresses, however in some places there are additional requirements. One client requires UL / CSA stamps on anything brought into the plant. This can sometimes require on site UL certification. In Washington state they require a Gold Seal on any building brought into the state. This is a seal certifying that anything hidden in the walls is code compliant. This requires a Washington state inspector to travel to the manufacturers plant to inspect the building before the walls are sealed up.
  • Transportation permits; in most cases the transportation company will get any transportation permits to ship a load to you. There is the odd time when you may have to get a permit to cross a highway but these are out of the norm.
  • Police & fire departments; in California we actually had to pay a permit fee to get police and fire protection. This was a first for me and I have not come across it since.
  • Radio licenses for 2-way radios; most plant sites use 2 way radios for communication. Your plant actually pays a fee for the radio channels. This is okay as long as you are on your plant site. If you have to set up another location where you need different channels you may have to pay a fee to get another frequency.
  • Boilers branch approvals; typically with pressure piping and pressure vessels, approval from the Boilers Branch is required. This involves sending drawings for approval and could include a meeting and of course a fee.
  • Department Of Labour approvals; in some provinces you are required to obtain approval of your structural drawings from the department of labour. This involves sending drawings, having a meeting and a fee.
  • Fire marshal; for buildings, plans need to be sent to the fire marshall for approval along with the fee. This could be more of a schedule issue than cost. I installed a thermal oil heating system in a plant and had to get fire marshall approval. Just by chance, I got the fire marshall who had previously approved a thermal oil system at another plant, and the plant burnt down due to the thermal oil. Needless to say, he was not happy when we showed up with our plans. We had to hire a consultant to work with him to get it approved. It took about six months to get his approval.

There may be other permits that I haven’t mentioned, but the point I’m trying to make is ask questions to find out exactly what permits are required as each jurisdiction has their own permit requirements.

I Didn’t Know That!

A third hidden contract you have to be aware of is demurrage. Whenever something is shipped to you, no matter how it comes, you are basically renting a piece of equipment. As part of the rental agreement, you have a certain amount of ‘free time’ to unload the item(s) from the equipment. After this ‘free time’, you will be charged a hourly or daily fee called demurrage. This is a charge for the late return of a piece of equipment supplied by one party to another for the purpose of carrying a cargo This cost is part of all shipping agreements your procurement group makes with the shipper. You have to be aware of what your ‘free time’ is, what the load is, when will it arrive, and how you will get it off. Typically for big loads you plan well in advance and advise the shipper when you want it to arrive. Otherwise, you will get a nice big demurrage bill. The same applies if you are shipping something and the cargo carrier has to wait for you to load the vehicle. Some ships can have a demurrage cost of $85,000 per day whether loading or off loading.

Plan Well Or You Will Be Surprised!

You have to be vigilant when dealing with utilities, government bodies (permits) and shipping as you don’t want a costly surprise. Its a matter of asking questions in the planning stage to make sure you have your costs covered.

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FREE Webinar April 7 - Leading A Quality-Driven Project Management Office: Honour the Past, Treasure the Present, Shape the Future

  • By: pcadmin on 01 Mar 2016

Operating a successful PMO requires leadership, vision, and insight. It also requires that your team buys in to your vision and works towards your common goals. This is really a cultural challenge: so can you create a culture where your PMO will thrive and continually improve?

In this case-based presentation, Procept associate Jonathan Nituch explores one company’s journey to create a PMO by focusing on quality first. How did this approach affect the creation of the PMO? What role did the team members play? How did the team’s attitude towards the PMO change over time?

You can’t create quality without managing quality. There is a tendency for quality to be associated with clipboards, inspections, and additional compliance burdens. Sadly, this perception is a reality when quality initiatives fail to recognize the critical role of culture. Through a culture of engagement, team members develop a sense of ownership for not only their projects, but for the PMO as a whole. As a result:

  • The PMO continually improves, along with the associated projects
  • The PMO maintains relevance amidst changing environmental conditions
  • The cost of quality continues to decrease
  • The ease of future changes increase dramatically

On April 7, 2016 at Noon Eastern time, attend this compelling presentation to learn how a quality-driven PMO honours the past by ensuring the necessary records are created; treasures the present by leveraging all opportunities for learning, growth, and improvement; and shapes the future by correcting past mistakes and preventing future errors.

Free Webinar - Innovative Lean Management Case Study: Implementing Lean in an Airline Cabin

  • By: pcadmin on 01 Mar 2016

While lean thinking and management techniques first began in the Japanese manufacturing sector, they have spread throughout many different industries (e.g. healthcare, distribution, and IT operations) and project types. Lean concepts are now popular with senior executives who want to improve results while reducing costs in these tight economic times.

Join us on March 11, 2016 at Noon Eastern time for this fascinating and unique 1-hour webinar presented by Þórdís V Þórhallsdóttir who applied her lean and project management training to her job as an airline flight attendant. Learn how she improved service delivery in an airline cabin challenged with turbulence, tight space restrictions, and short timelines. Don't miss this chance to learn from a unique case study with haunting similarities to problems we face in our business situations every day.

New Video - The Role of the PMO in Strategy Execution

  • By: pcadmin on 27 Feb 2016

Procept associate Amin Panjwani speaks on how a Project Management Office (PMO) can support business strategy execution. In particular, this presentation discusses the role of the PMO in strategy, from strategy development to execution. The speaker will share real-life case studies and lessons learned. This presentation will be useful for individuals who lead and direct projects and programs both in lines of business and within an EPMO, PMO leaders, business leaders and anyone interested in knowing more about how PMOs can contribute to strategy execution.

This is a recording of a live presentation at the 2015 International PM Day celebration in Toronto hosted by Procept.

New Video - Choosing the Right Approach

  • By: pcadmin on 25 Feb 2016

Kevin Aguanno, one of Procept's senior trainers and consultants, gives one of his most popular presentations titled "Choosing the Right Approach" in this 90-minute video published by Procept for free on YouTube. This presentation has been delivered at conferences and private corporate events around the world to tens of thousands of attendees. Learn the four different ways of structuring a project (waterfall, iterative, incremental, and IID/agile), the differences and benefits of the four approaches, and a decision-making framework to help you choose the right structural approach for any project. Examples are used from many different industries and many different project types to help clarify key points and ensure that all viewers can relate to the content.  This video was recorded live at the Procept-sponsored International Project Management Day celebration in November 2015 in Toronto.

Viewers of this video can claim 1.5 PDUs under Self-Directed Learning.

New Video - Understanding the PMI Talent Triangle

  • By: pcadmin on 12 Feb 2016

The Project Management Institute recently changed the way project managers claim recertification credits. They now require project managers to meet a minimum number of credits in each of the three areas of the PMI Talent Triangle. Take a half hour of your time to watch this video by Procept associate Kevin Aguanno wherein he explains why PMI needed to change the system, what is the Talent Triangle, how it affects the way we claim our professional development units (PDUs), and where one can go for more information. This change has already taken affect and you may already be impacted. Watch now to learn how to adjust to the changes.


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