Oil & Gas
SITUATION
An oilfield services company was experiencing significant capital project cost overruns and schedule slippage due to project management deficiencies and resource constraints.
DRIVER GOAL
Deliver $38 million capital project on time and on budget, including construction of a new facility in Mexico.
RESULT
- We developed and deployed an effective PMO function.
- Current critical path analysis forecasts an on-time delivery.
- The project has recovered from multi-million dollar cost overruns.
Case Study
Capital Project Management for a Multinational Oilfield Service Company
Issue
A multinational oilfield services company had initiated a $38 million capital project encompassing construction of a new manufacturing facility in Mexico, closure of two facilities in California, relocation of existing equipment as well as the purchase and installation of new equipment. The company was experiencing significant projected cost overruns and schedule slippage due to project management deficiencies and resource constraints.
Highland Approach
The Highland Group analyzed the existing project management system to understand the cause of delays, redundancies and budget overruns. We also executed a comprehensive organizational effectiveness analysis, which identified the optimum project management structure as well as critical experience gaps. Armed with those insights, we defined the project structure and implemented critical path management. We then designed a structured project management office (PMO) to increase project performance visibility and enable management to control overall execution. The Highland Group personnel are directly supporting the project through completion.
Actions Taken
Designed and implemented a System For Managing with tools to manage the work, remove barriers and improve performance. Specific components include:
- Pre-initiation design/project reviews
- Client/contractor communication plans
- Daily, weekly and monthly schedules
- Daily project controls
- Daily and weekly reviews
- Short-interval management tools
- Barrier identification and removal
- Schedule attainment and tracking
- Modularized training for future projects
