Project Vital Analysis®
Transparency for project efficiency: method and approach
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Problem description
Constantly increasing project complexity often causes the magic triangle of deadlines, quality and costs in major industrial projects to spiral out of control. Management boards, supervisory boards, managing directors, division managers, project managers, auditors or prospective buyers of project-oriented companies with long-term individual production often sense dark clouds on the horizon of company-critical projects, but are unable to “grasp” these vaguely recognizable signs. This group of people cannot and will not afford surprises.
Solution approach
The basic idea of the method is that complex technical systems (e.g. process plants, production processes) are conceived, planned, implemented and operated by complex social systems (organizations: e.g. corporations, investors, consortia, plant manufacturers, projects, plant operators, maintenance staff, quality organizations).
The organizations involved are confronted with a degree of complexity that cannot be handled with expert knowledge alone. The proportion of ignorance that must be adequately managed when making decisions is too great.
A method is required to analyze the organizational and operational structures of companies (complex social systems) in their relevant environments, i.e. to describe, explain and evaluate observed phenomena. For this purpose, the Project Vital Analysis® method is proposed, which has already proven itself in the analysis of over 85 projects with a project duration of over 250 years and a contract value of more than €15 billion.
The Project Vital Analysis® method is based on the usual audit approach of (standards-based) management systems for quality, project, risk and information security (“hard factors” or factual dimensions). In addition, the communication of the actors involved embedded in their area of responsibility (social dimension) as well as the project and company environment (system in its relevant environments) are included in the analysis and forecast (“soft factors”, complex social system).
In projects in the process industry, the typically relevant social systems are company and project organizations in the roles of clients and contractors. From the client’s perspective, the focus of a Project Vital Analysis® is typically in the areas of standardized project management, project risk management and company-wide risk management (enterprise risk management).
However, a more comprehensive view is required in order to gain a comprehensive impression of the project organization to be analyzed. For this reason, the requirements of the client are supplemented by the system-theoretical-constructivist perspectives of a second-order observer. This involves distinguishing, describing, explaining and evaluating vital (vital) aspects of complex structural and process organizations. In addition, recurring patterns are actively sought that make a difference compared to the organizational principles of high-reliability organizations (HRO) described by Karl E. Weick and Kathleen M. Sutcliffe:
Depending on the specific assignment, Dr. Hartmut Bossel’s guiding value theory (describing, explaining and evaluating long-term developments and potential development alternatives of complex systems) and selected research results on the human handling of uncertainty and complexity (describing, explaining and evaluating individual / personal behaviors of actors in complex problem-solving situations) by Dr. Dietrich Dörner are taken into account in the analysis as further orientation frameworks.
Norderstedt: Books in Demand GmbH, 1. Auflage 2004, Seite 247
Summary
Organizational principles of High Reliability Organizations (HRO), guiding value theory, selected research results on the human handling of uncertainty and complexity, complex social systems (project or company organizations) viewed from the second-order observer ‘s perspective of systems theory and constructivism have been incorporated into the development and refinement of Project Vital Analysis® in order to improve the reliability of result forecasts of concurrent costing in international large-scale plant construction.
On the debit side, the method is always based on the client’s specific targets and the current organizational and operational structure of the organization(s) to be analyzed. On the credit side, the current project situation and the current project results are analyzed with appropriate consideration of the project history. The focus of the analysis is on describing, explaining and evaluating scheduling and commercial aspects and their development over time (factual dimension). Information is collected in discussions with persons (actors) of the organization directly and indirectly involved in the project following a review of the commercial and organizational project documentation / reporting / ongoing calculation. Inspections of the project, depending on the project phase this also includes audits of globally distributed engineering organizations, key suppliers and construction sites, this allows a comparison of the reporting system with the facts personally inspected on site. Direct dialog and the observation, description and evaluation of communication between the players are essential components of the method (social dimension). For special topics, other specialists, e.g. psychologists and sociologists, are consulted in consultation with the client.
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Outlook
If you sense dark clouds on the horizon of business-critical plans, large-scale or mega projects, you need clarity. Project-accompanying audits, assessments and workshops bring previously hidden, undisclosed information to the table and into communication. In this way, you can prevent project crises, which can easily escalate into high-profile corporate crises in the case of large-scale and megaprojects.