How Project Management is evolving in the Infrastructure industry and how it can be leveraged for Large Mega Projects

Introduction

Adoption of Project Management in Indian Infrastructure Industry has been growing in the last few years, However the maturity in adoption of best practices has been mostly customer or owner driven. Several studies and reports issued by MoSPI, KPMG, PMI etc reveal that a large number of projects suffer delays and cost overruns. For example as per MoSPI Flash report of March 2019, it is observed that around 27 percent of the central sector projects are delayed beyond their scheduled date of completion.

Government of India has been pushing for revamping of Project Management by introducing several steps such as establishing the PMG , NITI Aayog backed InBOK and many other initiatives.

Along with recommendations given in these reports and documents for improvement in project delivery there are other areas which needs to be taken care. Such as the idea of Pay for project management, Fixing of accountability flowing from project owner to other project participants. Every team member is a Project Manager in his project area and adoption of continuous Training.

Also, understanding how the Project Management as a function has evolved over the years will help us to leverage it for effectively executing larger and mega projects

Project Management has been evolving in the infrastructure industry generally in the following stages.

1. Traditional Approach
2. The Modern Project Management
3. The Futuristic Transformational Project management

Traditional Approach

Before the 1950’s and 60’s projects were not managed, they were lead, executed and completed, Resources were not a concern, completing the objective was prime requirement.

Traditional style still exists today, specially when mandates given by head of state, owners of companies, where projects are completed by putting tremendous efforts expending huge resources and delivered within the desired timeline.

Modern Project Management?

Modern Project Management has emerged due to the limited availability of resources and funds on large US defence projects.

It involves avoiding problems, tackling new ground, managing a group of people and trying to achieve very clear objectives quickly and efficiently.

Some key people have emerged such as Project Manager, Planner, Cost Controller, Project Coordinator.

Indian Companies started investing in Project Management teams due to client requirements, consultancies, Popularity of Project management associations and institutions, Services - by Consultants

Project Manager - is an experienced person from the industry/domain. Often has limited training in Project Management.

Planner -?Responsible for planning the project activities by getting inputs from all.

Cost Controller - Within the project function, this role mostly takes care of measuring, monitoring and highlighting the variances taking place in budgeted items or cash flow issues. However, the actual cost controlling role exists with the Finance person reporting into the CFO and team.

Project Monitoring team - Most of the infrastructure organisations have a function called Planning, Monitoring reporting. Team size varies from company to company.

Project Monitoring in Owner Organization - Centralized team based out of head office. Does not have authority but responsibility. More like an information gathering, report generating team. They have some influence on the team but limited authority. Project Heads and Senior Management have an option of accepting or ignoring their inputs and recommendations.

Project Monitoring in Executing/Contracting organization - In smaller companies, the PM manages everything, In larger organisations a planner is assigned to a PM. Mostly works as a project coordinator or Assistant PM. And frequently found overloaded.

Project Planning and Monitoring Software - Software tools started claiming effective project management using their tools, example Primavera

Key features of Modern project Management

1. Project Conceptualisation - Product of the Project
2. Project Planning
3. Preparation and organisation of Resources
4. Project work execution
5. Performance monitoring and Measurement
6. Changes Management
7. Compensation and Compliances
8. Verification of Deliverables, Approval of Design
9. Acceptance of deliverables
10. Inspection and testing
11. Performance Guarantee
12. Punch points completion
13. Commissioning and handover
14. Project Closeout, Contract Closeout.

Challenges in Modern project Management

• Project Management is not completely aligned with all team members. Project Management team is considered as a separate team who does scheduling, monitoring and reporting of project activities
• Reactive approach instead of proactive.
• Lack of support from top management
• Considered as high overhead
• Project Planners are considered as Police, rather than assisting. Termed as date seekers

The Transformational Project Management

It is a combination of leadership, management, technology and innovation

The focus shifts from controlling to enabling. Instead of having separate group for project management or monitoring, the complete team is trained in project management practices. The Project monitoring team assumes the role of a mature PMO only guiding and supporting the team. Project Controls blends harmoniously into the project life cycle.

Every team members assumes the mindset of a Project Manager

In the below table, a Comparison between the three Project Management approaches are given

Infrastructure key Sectors in India

1. Road Transport & Highways
2. Metro, Railways and Civil Aviation
3. Ports & Shipping
4. Chemicals, Fertilizers and Petrochemicals?
5. Petroleum Oil & Gas
6. Coal and Mines
7. Power
8. Cement and Steel
9. Telecommunication and IT services?
10. Smart City Urban Development

Benefits and Value provided by Project Management in the above sectors

1. Robust Planning and Scope preparation
2. Execution Strategy
3. Risk Management
4. Change Management
5. Integrated Monitoring of Schedule, Cost, Quality, Safety performance
6. Harmonious Closeout
7. Lessons Learnt

Major Issues faced in Large Infrastructure Projects

External

1. Land Acquisition?
2. Regulatory and Environmental Clearances
3. Geographical Challenges
4. Inadequate Soil investigation and DPR, Time gap between DPR and tendering
5. ROW issues, Site Handover and Utility shifting
6. Resettlement and Rehabilitation?
7. Compensation issues
8. Lack of availability of good quality contractors
9. Financial bankruptcy of Contractors
10. Lack of skilled manpower
11. Escalation of material and tranportation cost beyond projections
12. Counter productive bidding compromising on quality

Internal

1. Insufficient planning and design
2. Timely inputs from client and consultant
3. Lack of Project Management training for employees
4. Lack of PMO
5. Decision making speed
6. Delays in Pre award activity
7. Silo Culture
8. Claims and Disputes
9. Poor Contract Administration?
10. Aggressive competition leading to lower bids
11. Lack of effective mechanism to manage changes and variations
12. Unclear Scope boundaries?

How Robust Project Management can help mitigate or avoid theses issues