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A pragmatic approach to maximize legacy construction management, ERP, estimating, and scheduling with a simple method to connect P6 Scheduling, SAP/Oracle, and other systems to generate accurate …

A pragmatic approach to maximize legacy construction management, ERP, estimating, and scheduling with a simple method to connect P6 Scheduling, SAP/Oracle, and other systems to generate accurate Earned Value Management.

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  • In 2010, an average of 46 terabits/second traveled over the Internet and should surpass 199 terabits/second in 2015. But while IP traffic is growing exponentially, the budgets for network equipment are growing at less than 10%.IDC predicts that spending on Ethernet equipment will grow about 8% per year from 2011 to 2014, so a critical challenge facing the industry is how to supply 32% more traffic annually while receiving only 8% more revenue per year. To meet both capacity and cost forecasts, the cost of bandwidth must decline at 18% per year (see Figure 1).
  • American adults this year will for the first time spend more time each day using digital media than watching TV, according to a new report by eMarketer.Adults in the U.S. are averaging five hours and nine minutes daily with digital media, up from four hours and 31 minutes last year and three hours and 50 minutes in 2011. The amount of time they spend watching TV has essentially stayed flat in that time period. It was pegged at four hours and 31 minutes this year, down slightly from four hours and 38 minutes in 2012.Overall, the amount of time spent consuming media in all its forms -- digital, TV, radio and print -- is cranking ever upward, though radio and print are dropping off, according to eMarketer. U.S. adults are spending an average of 11 hours and 52 minutes every day with media, up 13 minutes from last year.The surge in digital consumption has predictably been driven by mobile. U.S. adults now spend an average of two hours and 21 minutes per day using their mobile devices for activities other than phone calls, up 46 minutes from last year.Time spent on smartphones, tablets and feature phones now also exceeds time spent on PCs, which clocked in at two hours and 19 minutes. The figure for PC use may seem low to any office worker who spends most days in front a computer screen, but eMarketer is taking all U.S. adults into account, some 20% of which still don't use the internet, according to Clark Fredrickson, VP-communications at the research firm.The figures account for time spent with every unique medium, regardless of the overlap in consumption. Thus, people watching a basketball game while simultaneously continually tweeting about it from their tablets would count for two hours spent watching TV and two hours spent using a mobile device.To produce the report, eMarketer aggregated data points from more than 40 research institution
  • There are a few, but many of the world's top companies in 1985 have foundered, shrunk, grown obsolete, or been acquired by rivals that grew stronger. General Motors and Ford, the world's two biggest carmakers in 1985, spent the last decade in a dizzying tailspin, bleeding cash, losing market share, and struggling to turn themselves around. Venerable industrial firms like ITT restructured and drifted down the Fortune 500, while Wal-Mart, Verizon, banks, and technology firms displaced them. Digital Equipment and Wang Laboratories, once leading computer firms, disappeared completely. Even resurgent titans like Apple and IBM stared into the abyss of irrelevance and made painful changes before clawing their way back to the top.There's a psychological trap, in which company leaders fixate on what made them successful and fail to notice when something new is displacing it. Then there's the strategic trap, when a company focuses purely on the marketplace of today and fails to anticipate the future. Some unlucky companies manage a trifecta and fall into all three traps.
  • The IDC study predicts that overall data will grow by 50 times by 2020, driven in large part by more embedded systems such as sensors in clothing, medical devices and structures like buildings and bridges.
  • The IDC study predicts that overall data will grow by 50 times by 2020, driven in large part by more embedded systems such as sensors in clothing, medical devices and structures like buildings and bridges.
  •  According to Gartner, firms in the construction and materials industries with annual revenue of about $250 million invest about 1.6% of that in IT. For firms with annual revenue of about $10 billion, the average is 1.1%—dead last compared to industries such as banking, health care, retail and transportation (see related story here). And that's for all IT operations. Within those percentages, firms are making even smaller investments in software tools to tame big data.
  •  According to Gartner, firms in the construction and materials industries with annual revenue of about $250 million invest about 1.6% of that in IT. For firms with annual revenue of about $10 billion, the average is 1.1%—dead last compared to industries such as banking, health care, retail and transportation (see related story here). And that's for all IT operations. Within those percentages, firms are making even smaller investments in software tools to tame big data.
  • According to the Bureau of Labor Statistics, 70% of U.S. productivity growth comes from IT
  • According to the Bureau of Labor Statistics, 70% of U.S. productivity growth comes from IT
  • Faulty logic woven throughout a firm's files is a common problem among the multinational crews that make up today's massive project schedules.
  • A prime example is the delivery of steel to a site, Pressley notes. "The schedule says when the truck carrying the steel needs to be there and [a beam] needs to be bolted to column 8B, for example," he says. "You can overcomplicate a schedule so much that logic ties don't work. That's when you get logic [busts] that say faucets on the 23rd floor will delay the concrete on the fifth."
  • A prime example is the delivery of steel to a site, "The schedule says when the truck carrying the steel needs to be there and [a beam] needs to be bolted to column 8B, for example," he says. "You can overcomplicate a schedule so much that logic ties don't work. That's when you get logic [busts] that say faucets on the 23rd floor will delay the concrete on the fifth."
  • One CII member company found laser scanning on a facility upgrade project yielded a more than 80% reduction in design time and a 98% reduction in the number of field travel days, says Mark Stofega, construction support engineer in the Greenville, S.C., office of Fluor Corp. “More importantly, this results in less field rework for our craft,” he says.
  • Researchers identified numerous barriers to this type of construction, such as code variations in different jurisdictions and the need for customization. Module applications should be scalable and repeatable and “not be approached as one-off project solutions to facilitate a specific project,” says David Behrens, chief construction engineer with Bechtel Systems and Infrastructure, a division of San Francisco-based Bechtel Group. Contractors will have to increase capital investment to set up infrastructure jigs and templates, but per-unit cost of buildings will drop, says the study.
  • One key adoption from shipbuilding is the interim product database, which contains products and production processes that are easily reconfigurable for each project. Standardized modules and sub-assemblies are grouped into families by similarity and zones (such as plant zones for mechanical systems or public zones for lobbies) and then built in a manufacturing-type facility to be shipped to the jobsite for installation.
  • What EVM IsEarned value management goes beyond simply comparing budgeted costs to actual costs. It measures thevalue of work accomplished in a given period and compares it with the planned value of work scheduled for that period and with the actual cost of work accomplished. By using the metrics derived from these values to understand performance status and to estimate cost and time to complete, EVM can alert program managers to potential problems sooner than expenditures alone can.Assume, for example, that a contract calls for 4 miles of railroad track to be laid in 4 weeks at a cost of $4 million. After 3 weeks of work, only $2 million has been spent. An analysis of planned versus actual expenditures suggests that the project is underrunning its estimated costs. However, an earned value analysis reveals that the project is in trouble because even though only $2 million has been spent, only 1 mile of track has been laid and, therefore, the contract is only 25 percent complete. Given the value of work done, the project will cost the contractor $8 million ($2 million to complete each mile of track), and the 4 miles of track will take a total of 12 weeks to complete (3 weeks for each mile of track) instead of the originally estimated 4 weeks.Thus, EVM is a means of cost and schedule performance analysis. By knowing what the planned costis at any time and comparing that value to the planned cost of completed work and to the actual costincurred, analysts can measure the program’s cost and schedule status. Without knowing the planned costof completed work and work in progress (that is, earned value), true program status cannot be determined.Earned value provides the missing information necessary for understanding the health of a program; itprovides an objective view of program status. Moreover, because EVM provides data in consistent units(usually labor hours or dollars), the progress of vastly different work efforts can be combined. For example,earned value can be used to combine feet of cabling, square feet of sheet metal, or tons of rebar with effortfor systems design and development. That is, earned value can be employed as long as a program is brokendown into well-defined tasks.
  • What EVM IsEarned value management goes beyond simply comparing budgeted costs to actual costs. It measures thevalue of work accomplished in a given period and compares it with the planned value of work scheduled for that period and with the actual cost of work accomplished. By using the metrics derived from these values to understand performance status and to estimate cost and time to complete, EVM can alert program managers to potential problems sooner than expenditures alone can.Assume, for example, that a contract calls for 4 miles of railroad track to be laid in 4 weeks at a cost of $4 million. After 3 weeks of work, only $2 million has been spent. An analysis of planned versus actual expenditures suggests that the project is underrunning its estimated costs. However, an earned value analysis reveals that the project is in trouble because even though only $2 million has been spent, only 1 mile of track has been laid and, therefore, the contract is only 25 percent complete. Given the value of work done, the project will cost the contractor $8 million ($2 million to complete each mile of track), and the 4 miles of track will take a total of 12 weeks to complete (3 weeks for each mile of track) instead of the originally estimated 4 weeks.Thus, EVM is a means of cost and schedule performance analysis. By knowing what the planned costis at any time and comparing that value to the planned cost of completed work and to the actual costincurred, analysts can measure the program’s cost and schedule status. Without knowing the planned costof completed work and work in progress (that is, earned value), true program status cannot be determined.Earned value provides the missing information necessary for understanding the health of a program; itprovides an objective view of program status. Moreover, because EVM provides data in consistent units(usually labor hours or dollars), the progress of vastly different work efforts can be combined. For example,earned value can be used to combine feet of cabling, square feet of sheet metal, or tons of rebar with effortfor systems design and development. That is, earned value can be employed as long as a program is brokendown into well-defined tasks.
  • What EVM IsEarned value management goes beyond simply comparing budgeted costs to actual costs. It measures thevalue of work accomplished in a given period and compares it with the planned value of work scheduled for that period and with the actual cost of work accomplished. By using the metrics derived from these values to understand performance status and to estimate cost and time to complete, EVM can alert program managers to potential problems sooner than expenditures alone can.Assume, for example, that a contract calls for 4 miles of railroad track to be laid in 4 weeks at a cost of $4 million. After 3 weeks of work, only $2 million has been spent. An analysis of planned versus actual expenditures suggests that the project is underrunning its estimated costs. However, an earned value analysis reveals that the project is in trouble because even though only $2 million has been spent, only 1 mile of track has been laid and, therefore, the contract is only 25 percent complete. Given the value of work done, the project will cost the contractor $8 million ($2 million to complete each mile of track), and the 4 miles of track will take a total of 12 weeks to complete (3 weeks for each mile of track) instead of the originally estimated 4 weeks.Thus, EVM is a means of cost and schedule performance analysis. By knowing what the planned costis at any time and comparing that value to the planned cost of completed work and to the actual costincurred, analysts can measure the program’s cost and schedule status. Without knowing the planned costof completed work and work in progress (that is, earned value), true program status cannot be determined.Earned value provides the missing information necessary for understanding the health of a program; itprovides an objective view of program status. Moreover, because EVM provides data in consistent units(usually labor hours or dollars), the progress of vastly different work efforts can be combined. For example,earned value can be used to combine feet of cabling, square feet of sheet metal, or tons of rebar with effortfor systems design and development. That is, earned value can be employed as long as a program is brokendown into well-defined tasks.
  • What EVM IsEarned value management goes beyond simply comparing budgeted costs to actual costs. It measures thevalue of work accomplished in a given period and compares it with the planned value of work scheduled for that period and with the actual cost of work accomplished. By using the metrics derived from these values to understand performance status and to estimate cost and time to complete, EVM can alert program managers to potential problems sooner than expenditures alone can.Assume, for example, that a contract calls for 4 miles of railroad track to be laid in 4 weeks at a cost of $4 million. After 3 weeks of work, only $2 million has been spent. An analysis of planned versus actual expenditures suggests that the project is underrunning its estimated costs. However, an earned value analysis reveals that the project is in trouble because even though only $2 million has been spent, only 1 mile of track has been laid and, therefore, the contract is only 25 percent complete. Given the value of work done, the project will cost the contractor $8 million ($2 million to complete each mile of track), and the 4 miles of track will take a total of 12 weeks to complete (3 weeks for each mile of track) instead of the originally estimated 4 weeks.Thus, EVM is a means of cost and schedule performance analysis. By knowing what the planned costis at any time and comparing that value to the planned cost of completed work and to the actual costincurred, analysts can measure the program’s cost and schedule status. Without knowing the planned costof completed work and work in progress (that is, earned value), true program status cannot be determined.Earned value provides the missing information necessary for understanding the health of a program; itprovides an objective view of program status. Moreover, because EVM provides data in consistent units(usually labor hours or dollars), the progress of vastly different work efforts can be combined. For example,earned value can be used to combine feet of cabling, square feet of sheet metal, or tons of rebar with effortfor systems design and development. That is, earned value can be employed as long as a program is brokendown into well-defined tasks.
  • Real ProgressReal progress can be tracked as actual labor hours against the final total labor hours expended ona project. This, however, requires knowing what the final total is. Therefore, real progress canonly be estimated using the estimated hours at completion until the project is 100% finished.Real Progress = Actual Hours/Total
  • the drawbacks of using hours spent as the basis for a progressassessment. In an over-run situation, this method will show better than budgeted progress untilthe entire budget has been spent. The reverse occurs for the under-run situation.
  • Lets apply those principles to the actual touch points of a common ERP system like JD Edwards, SAP or Oracle in this case JD Edwards.
  • Common Set of Types back to detailSupply Detail information at the activity level rolled up to the ERP System
  • Open Time Entry to include QTY, and % complete direct from the contractor, EPCM to the owner where applicable.
  • When items are received on site, record “Rules of Credit” and “Progress data against the purchase order to execute next phase of projects
  • Payrool total Hours
  • Transcript

    • 1. Construction Leaders Formula to Simplify EVM Presented by: Ron Babich, PMP 2/14/2014 © MobileLogix / DispatchLogix 2014 CEO / Co-Founder MobileLogix/DispatchLogix 1
    • 2. About Us • Ron Babich, CEO MobileLogix Goodrich Shell Bloomberg Hatch Uhaul BP Time Stantec PetsMart Willbros Darden Restaurants FMI • 100% SAAS, Mobile Field Software Tribune Wild Well HP FCI • Over 211 Capital, Maintenance, STO projects Mitsubishi Universal Coca-Cola Barrick Kohler CH2MHill US Airways TransCanada Payless Johnson Controls Transfield HD Supply State Farm Kinross • HQ Phoenix, AZ – Global Partner Support • GE Capital, Sage, Telesoft, Hard Dollar/Kiewit, RIB • Finalist in Innovation Southwest Most Innovative Product Award 2/14/2014 © MobileLogix / DispatchLogix 2
    • 3. EVM Paradigm Highest Risk Execution Report Financials Plan Cash Flow Estimate Forecast Schedule Resources Lowest Visibility 2/14/2014 © MobileLogix / DispatchLogix 3
    • 4. Tough to Train? Cooperate? Owners EPCM’s Contractors 2/14/2014 © MobileLogix / DispatchLogix 4
    • 5. Revolution in EVM Reporting Opportunity to Leverage Consumer Training 2/14/2014 © MobileLogix / DispatchLogix 5
    • 6. Critical Field Data Quantity Time to Report Man Hours 6 to 8 Weeks Equip Hours % Complete 2/14/2014 © MobileLogix / DispatchLogix 6
    • 7. Critical Field Data Quantity Planned Man Hours Actual Equip Hours Forecast Hour by Hour % Complete 2/14/2014 © MobileLogix / DispatchLogix 7
    • 8. Manage by Exception Balance $35.00 Below Standard Instant Notification of Bank Balance Reaches Below Minimum Expectation Value ($ Spouse Grocery / Hair ) 2/14/2014 © MobileLogix / DispatchLogix 2014 8
    • 9. In the know on data… Lost Lead Position Outbid by Ebayer007theTerrible on Collectors edition of Star Wars Episode 5 Storm Trooper set Value $25, (Darth Vader +/- $30) 2/14/2014 © MobileLogix / DispatchLogix 2014 9
    • 10. Important Notifications Networking Notification Mothers high score notification, and reminder to join her adventure in Candy Crush Value ($0, Negative) 2/14/2014 © MobileLogix / DispatchLogix 2014 10
    • 11. Value to Visibility $2,500,000 $2,000,000 Monthly Updates $1,500,000 Instant Updates $1,000,000 $500,000 $Ebay 2/14/2014 Bank Project © MobileLogix / DispatchLogix 11
    • 12. Continued Stone Age… 2/14/2014 © MobileLogix / DispatchLogix 2014 12
    • 13. Pressure from Consumer Products / Youth Outside (Them…also Us) Inside (US) 2/14/2014 © MobileLogix / DispatchLogix 13
    • 14. What has created the opportunity? Size Retainable Data Storage 2/14/2014 Bandwidth Data Delivery Mobile Data Accessibility © MobileLogix / DispatchLogix 2014 Application Collaboration (API/Warehouse) 14
    • 15. Storage 2/14/2014 © MobileLogix / DispatchLogix 2014 15
    • 16. Bandwidth 2/14/2014 © MobileLogix / DispatchLogix 2014 16
    • 17. Mobility 2/14/2014 © MobileLogix / DispatchLogix 2014 17
    • 18. Migration to Data Understanding How we choose to view Data has officially changed… 2/14/2014 © MobileLogix / DispatchLogix 2014 18
    • 19. Mobility Training 2/14/2014 © MobileLogix / DispatchLogix 2014 19
    • 20. Anatomy of Breaking EVM Simple Good News 2/14/2014 Bad News © MobileLogix / DispatchLogix 20
    • 21. Best Part, more good news… Legacy systems will do the trick….mostly 2/14/2014 © MobileLogix / DispatchLogix 21
    • 22. No Magic Potion, No Tricks Smart Collaboration Owners EPCM’s Contractors 2/14/2014 © MobileLogix / DispatchLogix 2014 22
    • 23. Why Should We Do Anything Different? 2/14/2014 © MobileLogix / DispatchLogix 23
    • 24. Its Ok not to Innovate… Quick quiz: Name a leading company today that was just as dominant 25 years ago. 2/14/2014 © MobileLogix / DispatchLogix 2014 24
    • 25. Failure to Innovate Technology Yesterday Today Blockbuster (Distribution) Netflix – Mail, Internet Dell (PC) Tablet, Asian PC, End to End Service Microsoft (Software) Web TV, Smartphones, Tablet PC Motorola (Cell Phone) Smartphones, Email, Data Focus Sears (Catalog/Tower) Insurance, Financial Services, Web Strategy Sony (Walkman, Devices) Device Brains vs. Circuitry Sun Microsystems (Dominant Enterprise) Less Costly Servers, Oracle Toys R Us Online Stores, Better Service Yahoo Free Services Where are you today? 2/14/2014 Where will you be tomorrow? Where will the new force be tomorrow? © MobileLogix / DispatchLogix 2014 25
    • 26. Destiny to Change… 2/14/2014 © MobileLogix / DispatchLogix 2014 26
    • 27. Why the effort… Fighting Status Quo • Increasing Profitability • Improving Project Delivery Time • Creating Marketplace Distinctive Competency • Establishing Long Term Collaboration Standards 2/14/2014 © MobileLogix / DispatchLogix 2014 27
    • 28. Leveraging New Technology Causes Internal Anxiety Reaction to Surrounding Technology Internal Effect Duration Results Process Enhance, Technology Plan/Embrace High Stress, Focus Effort Increased, Exponential Results Sustain Current Behaviors, Maintain Status Quo Technology, Disparate Silo’s Low Stress, Reduced Effort Maintained, Reduced Results © MobileLogix / DispatchLogix 2014 28
    • 29. Traditional Systems of Record – What are we up against??? Estimate Schedule 2 Year Project Average Controls/Execution/Progress 2/14/2014 23,000 Activities © MobileLogix / DispatchLogix 2014 Finance Actuals 29
    • 30. Expansion of Size Average Project Data Scope/Schedule/Cost 50 Gig 1 Complex 3D Model 300 Gig 2/14/2014 © MobileLogix / DispatchLogix 2014 30
    • 31. Data Growth Leaders in Construction Average Organization 50 X Times by 2020 Structural Leads: Building, Bridges 2/14/2014 © MobileLogix / DispatchLogix 2014 31
    • 32. Data Multiplication Data Rate Almost X 2 Each Year 2/14/2014 © MobileLogix / DispatchLogix 2014 32
    • 33. Construction Industry Response… Revenue of $250 million 1.6% IT Revenue of $10 billion 1.1% 2/14/2014 © MobileLogix / DispatchLogix 2014 33
    • 34. Lowest in adaptation… IT SPEND AS PERCENTAGE OF REVENUE INDUSTRY ANNUAL REVENUE APPROXIMATELY $250 MILLION ANNUAL REVENUE APPROXIMATELY $10 BILLION BANKING 7.3% 6.2% CONSTRUCTION & MATERIALS 1.6% 1.1% EDUCATION 5.6% 3.3% FEDERAL GOVERNMEnT 10.8% 7.9% STATE AND LOCAL GOVERNMENT 4.6% 1.8% SOFTWARE AND INTERNET 8.4% 5.4% INSURANCE 5.3% 2.9% HEALTH CARE 3.5% 3.3% MEDIA 5.4% 3.2% PHARMACEUTICALS 3.0% 2.6% PROFESSIONAL SERVICES 5.6% 3.4% RETAIL AND WHOLESALE 1.9% 0.9% TELECOMMUNICATIONS 4.9% 3.8% TRANSPORTATION 3.5% 2.3% UTILITIES 4.2% 1.7% ACROSS ALL 15 INDUSTRIES 5.04% 3.16% 2/14/2014 © MobileLogix / DispatchLogix 2014 34
    • 35. Look for Gains… 70% of US Productivity Originates from…. IT / Data Manage/Understand Forrester 2014 2/14/2014 © MobileLogix / DispatchLogix 2014 35
    • 36. Highest Rewards… Front End Planning Highest ROI…. Historic, Virtual 2/14/2014 © MobileLogix / DispatchLogix 2014 36
    • 37. Lessons from Projects Common Faulty Logic Multinational Crews Massive Project Scales Estimated Turnaround Time = 3 Hours Actual Historic Turnaround Time = 3 Weeks 2/14/2014 © MobileLogix / DispatchLogix 2014 37
    • 38. 1 of 1000 Reasons Omission of History/Benchmarks Missing Scope Items Identified Late in Project 10%-15%+ Project Impact 2/14/2014 © MobileLogix / DispatchLogix 2014 38
    • 39. 1 of 1000 Reasons Delivery of Steel to Site Over-Complex Schedules Logic Ties don’t work Faucets on 23rd Floor Delay Concrete on 5th Floor 2/14/2014 © MobileLogix / DispatchLogix 2014 39
    • 40. 1 of 1000 Reasons - Pro Use of Collaboration Data – Single Project • 80% Reduction in Design Time • 98% Reduction in Number of Field Travel Days • Less Field Rework for Craft Source: KPMG 2/14/2014 © MobileLogix / DispatchLogix 2014 40
    • 41. Planning Overcomes Barriers Barriers: • Code Variations • Lack of Infrastructure Jigs and Templates Leading Companies Make it: • Repeatable • Scalable 2/14/2014 © MobileLogix / DispatchLogix 2014 41
    • 42. Lessons from Manufacturing Shipbuilding Example: Product Database: • Plant zones for mechanical systems or public zones for lobbies • Products • Production • Reconfigurable for each project • Built in Manufacturing Type Facility to be shipped to jobsite for installation • Standard Modules • Sub-Assemblies • Grouped by Families 2/14/2014 © MobileLogix / DispatchLogix 2014 42
    • 43. 1 of 1000 Reasons Dive into a Schedules WBS Associate Costs… Size of Data Out of Control 1 WBS / PHASE CODE 2/14/2014 © MobileLogix / DispatchLogix 2014 Associate Costs to: 3 Day Schedule of Crane 5 Day Schedule of it’s Crew 7 Day Schedule of Materials 43
    • 44. What is Earned Value Management? • Earned Value Management (EVM) • Is a project management process that combines schedule performance and cost performance • Answers the question, “What did we get for the money we spent?” • Has been used since the 1960s by the Department of Defense • Is a central part of CERT and C/SCSC (Cost/Schedule Control Systems Criteria) • Revised and adopted as ANSI/EIA 748
    • 45. What is Earned Value Management? The Essence of Earned Value Management (EVM) Budget x % Complete = Earned Value
    • 46. EVM Scenario: Railroad Track Contract says: 4 miles 4 weeks; $4 million
    • 47. EVM Scenario: Railroad Track After 3 weeks of work, only $2 million has been spent. Sound good? Let’s do an EVM analysis.
    • 48. EVM Scenario: Railroad Track EVM analysis says: 1 mile Only 25% complete. Project IN TROUBLE.
    • 49. EVM Scenario: Railroad Track EVM: Budget x % Complete = Earned Value RR Project: $4 million x 25% = $1 million EV But $2 million already spent in 3 weeks. At this rate, project will cost $8 million and take 12 weeks to complete.
    • 50. Simplified Collaboration Scope Collaborate Cost Schedule 2/14/2014 © MobileLogix / DispatchLogix 2014 50
    • 51. Benefits of Collaboration 8 Steps to Best Practice Clear Identification of Task Provision for Program Uncertainties Broad Participation in Preparation Recognition of Inflation Availability of Valid Data Recognition of Excluded Costs Standardized Structure For Estimate Independent Review Of Estimates 2/14/2014 © MobileLogix / DispatchLogix 2014 Clean it Up 51
    • 52. Measure Twice Cost Element Valid and Applicable Labor Includes Time Phase Break Down Calculations on each element are correct Program is Accurate Total Of Sub-Elements Escalation was applied Over time 2/14/2014 © MobileLogix / DispatchLogix 2014 52
    • 53. Single Zen = Not in this lifetime…or the next Split by - Technology / Disciplines Estimating Timberline HCSS Maxwell Hard Dollar Cleopatra MC2 Others… Schedule P6 MS Project Fact vs. Fiction 2/14/2014 Field Spreadsheets ERP Timberline Dexter Chaney Viewpoint JD Edwards SAP Explorer Others… Tools / Platform Dilemma Lesson: Prepare to Integrate!!! © MobileLogix / DispatchLogix 53
    • 54. Practical Approach to “Connect the Dots” – Collaborate Estimate Controls Schedule ERP 2/14/2014 © MobileLogix / DispatchLogix 54
    • 55. Practical Approach to “Connect the Dots” – Collaborate Estimate Controls Schedule ERP 2/14/2014 © MobileLogix / DispatchLogix 55
    • 56. Pick a Problem - Match Game Forget about Technology – What do we need?? Cash Flow Forecast Progress Profit Benchmark History Resources Time (Start / Finish) Got to be all or Nothing Scope (WBS/Activity/Phase) Activity Factor (Time/Quantity/Fixed) Historic (Past, Original, Current Approved, Current Commits) Actual Costs / Accruals 2/14/2014 © MobileLogix / DispatchLogix 56
    • 57. Pick a Problem - Match Game Forget about Technology – What do we need?? Estimating Resources (Factored) Time (Start / Finish) Scope (WBS/Activity/Phase) Activity Factor (Time/Quantity/Fixed) History (Past, Original, Current Approved, Current Commits) Actual Costs / Accruals 2/14/2014 © MobileLogix / DispatchLogix 57
    • 58. Pick a Problem - Match Game Forget about Technology – What do we need?? Schedule Resources (Factored) Time (Start / Finish) Scope (WBS/Activity/Phase) Activity Factor (Time/Quantity/Fixed) History (Past, Original, Current Approved, Current Commits) Actual Costs / Accruals 2/14/2014 © MobileLogix / DispatchLogix 58
    • 59. Pick a Problem - Match Game Forget about Technology – What do we need?? ERP Resources (Factored) Time (Start / Finish) Scope (WBS/Activity/Phase) Activity Factor (Time/Quantity/Fixed) History (Past, Original, Current Approved, Current Commits) Actual Costs / Accruals 2/14/2014 © MobileLogix / DispatchLogix 59
    • 60. Pick a Problem - Match Game Forget about Technology – What do we need?? Field Spreadsheet Paper Time Resources (Factored) Time (Start / Finish) Scope (WBS/Activity/Phase) Activity Factor (Time/Quantity/Fixed) History (Past, Original, Current Approved, Current Commits) Actual Costs / Accruals 2/14/2014 © MobileLogix / DispatchLogix 60
    • 61. Build a Project Forecast Estimating Progress Measure/Collect Finance Schedule Report 2/14/2014 © MobileLogix / DispatchLogix 61
    • 62. Crossroads – Resource Driver Variance Project Phase 1 Cost Model Utilize Cost Model Resource Activity Driver Schedule Duration Driven Progress % Duration Driven Quantity Driven Fixed Cost Driven 2/14/2014 Fix: Cash Flow, Resource Graph, Forecast © MobileLogix / DispatchLogix 62
    • 63. Crossroads – Resource Driver Variance Project Phase 1 Cost Model Utilize Cost Model Resource Activity Driver Schedule Duration Driven Progress % Duration Driven Quantity Driven Fixed Cost Driven 2/14/2014 Fix: Cash Flow, Resource Graph, Forecast © MobileLogix / DispatchLogix 63
    • 64. Crossroads – Resource Driver Variance Project Step 2 Cost Model Time Phase Cost Model Schedule Duration Driven Progress % Start / Finish Fix: Cash Flow, Resource Graph, Forecast, A ccrual 2/14/2014 © MobileLogix / DispatchLogix 64
    • 65. Crossroads – Resource Driver Variance Project Step 3 Cost Model Resource/Cost Load Schedule Schedule Activities Steps Resources Activities Activity Factors 2/14/2014 Fix: Cash Flow, Resource Graph, Forecast, A ccrual © MobileLogix / DispatchLogix 65
    • 66. Crossroads – Resource Driver Variance Project Step 3 Create “Repeatable” Cost/Phase/GL Codes:Execution Fix: Cash Flow, Resource Graph, Forecast, A ccrual 2/14/2014 © MobileLogix / DispatchLogix ERP % Complete Cost/Phase/GL Schedule Reconcile to Cost Model Quantity Field Data Cost/Phase/GL Activity Factor Work Package “Earned Actual” Build Accrual 66
    • 67. Crossroads – Resource Driver Variance Project Step 3 Field Data Drive % Complete From Factor Driven Field Data Collection Quantities Pass Values to Schedule/ERP Duration 2/14/2014 Fix: Cash Flow, Resource Graph, Forecast, A ccrual © MobileLogix / DispatchLogix ERP % Complete Reconcile to Cost Model Quantity Man/Equip Hours Schedule Cost/Phase/GL Activity Factor Work Package “Earned Actual” Build Accrual 67
    • 68. Heavy Lifting vs. Making Simple Quick Fix • CPI - Cost Performance Index is .8333 • MHE – Man Hour Production 30% Less than Expected on Crew Performance • SPI – Schedule Performance Index= $116,000 / $125,000 = 0.93 • Cash Flow does not reflect impact of actual vs. planned performance • Current Schedule Does not reflect when we will finish based on production • Average time to receive performance indicators, 32 days after root cause 2/14/2014 © MobileLogix / DispatchLogix 2014 68
    • 69. How much is to much? “To Detail or not Detail? That is the Question. Whether tis nobler in the mind to sling through piles of data or take arms against it” Lesser Known Barry Shakespeare
    • 70. Building Perfection in Progress Create Model for Project Reconciliation against ERP 1. Eliminate Internal Speculation – Determine Consistent Method of Measurement (Qty/%) 2. Report on Summary – Record , Capture Detail 3. Open progress to vendor input on measurements 4. Leverage the schedule for true EVM performance (SPI, CPI) 5. Standardize WBS for consistent current and historical measurement Progress
    • 71. Now vs. Later End of Project Real Progress = Actual Hours/Total Late to modify Performance
    • 72. Progress by Hours… Manual Progress Phase Hours/Cost Hours Spent
    • 73. Principles Applied • • • • • • Budget Time Receipts Progress Actual Cost Reconciliation
    • 74. Common Touch Points - Budget • Master Data (ERP->Cost Model System) • Job/CR/WO/PO numbers • Cost Codes • Cost Types • Structure, $, Quantities, Dates (Cost Model System->ERP) • • • • • • Original Budget Budget Revisions Change Requests Work Orders Purchase Orders Forecasts
    • 75. Common Touch Points – Time Entry • Master Data (ERP<->FIELD SYSTEM) • Job Steps, Job Types, Pay Types • Employees • Equipment • Date, Account Code, Resource ID, Hrs, Notes, Weather (FIELD SYSTEM->JDE)
    • 76. Common Touch Points – Purchase Order • PO, Line Item, Qty Received, Estimated Value, Date Received (FIELD SYSTEM --> ERP)
    • 77. Common Touch Points Progress Entry • Date, % Complete, Quantity Complete, Foreman (FIELD System->ERP or ERP->FIELD System) • **Also Drives Primavera % Complete Calculation
    • 78. Common Touch Points • Reconciling G/L to Job Cost ERP <<->> FIELD System • Accrual of Estimated Actual • Quantity/Cost/Man Hours/Equip Hours • Payroll • Asset Management • Procurement Management • Subcontract Management
    • 79. Keys to Success • • • • • • • Initiate at the Cost Model Estimate Level (Calculation of Production) Time Phase Costs Cost Phase Scheduling Activities Cautious Burden in the Field – Leverage Existing Process Extend Collaboration (Vendor, Owner, EPCM, Contractor) Leverage Existing Technology (Last 2 Years = API, Size, Bandwidth) Core Process, Top Down Strategy 2/14/2014 © MobileLogix / DispatchLogix 2014 79
    • 80. 15%-30% Results Outcome  Cost Estimate to Measure Original Plan  Strong leadership demands EVM  Stakeholders make it clear on accountability  Management open to mitigating risk on results  EVM at the program level Core EVM  EVM planned detail  Use past performance  Integrate: Cost, Schedule and Performance  Visual Planning, Execution 2/14/2014 © MobileLogix / DispatchLogix 2014 80
    • 81. End Result - Project Reconciliation – Holistic ERP Vendor POs Cost Management Customer, Opportuni ty, or Project Information Materials Master & Pricing Vendor Master Estimate Quote Mgmt Project Number Contracts & Change Orders CRM Estimate Pricing Field Data MobileLogix Control Tower Takeoff BIM Pay Items Actuals Tracking Project Status WBS Structure & Dates Material Qtys Budget Values (original budget, curr. budget, curr. est.) HR Master Data Current Forecast Progress Measurement Earned Values Time Entry (hours & qtys) (optional) Time Entry (hours & Qtys) Equipment Rates & Types Project Structure Schedule Dates Document Link Mobile Field Collection MobileLogix Document Link Actuals Scheduling (P6 & MSP) Document Management - SharePoint
    • 82. Send SAP Vendor and Material Data to Field System
    • 83. Receive Budget Values from Cost Model into SAP WBS
    • 84. SAP Actual Quantities and Dollars Compared to Original Budget
    • 85. EVM to SAP (QTY/% Complete) % from Field Data System
    • 86. Forecast Dollars & Quantities from Field Data System to SAP
    • 87. Field Data Pay Items to SAP for AR & Revenue Recognition
    • 88. Core Collaboration – Non-glamorous Estimate / Planning Field Execution 2/14/2014 AFE’s Account Codes Cost Codes Cost GL Code Account Codes Cost Codes Work Package Area Discipline Quantities (Unit) Man / Equip Hr % GL Code Account Codes Cost Codes Accounting Account Codes Cost Codes Area Discipline Rules of Credit / % Collaboration External © MobileLogix / DispatchLogix 88
    • 89. Redefining Customer Service Re-Define Customer Service • Expectations Schedule Time • Visibility Performance • Communication Throughout Field Touch Points Number 1 Field Complaint = “Where is my person?”
    • 90. See Every Activity… Answer: How the Project/Work is doing…. • Project Status Visibility: • Plan vs. Progress • % Complete/Qty Update • Cash Flow, Earned Value • Resource Planning • Exception Alerts • Expedite Invoicing
    • 91. Web / IPAD Based “Control Tower” View Todays Tasks within the Project “Play of the Day” Activity Assigned on Resource Expertise Launch New Activity Scheduled/Assigned Activities Add/Modify Equipment Vehicles/Equipment Requiring Maintenance Schedule Sub/Crew Material Add/Search/Location
    • 92. Transparent Field to Plan Comparison Planned / Estimated Execution / Controls Owner / Reporting Qty / % Complete Cost / Productivity Schedule of Activities Work Package A Work Package B Work Package C Planned vs. Actual Performance Comparison
    • 93. Transparent Field to Plan Comparison Planned / Estimated Schedule of Activities Schedule ID Schedule ID Execution / Controls Owner / Reporting Cost Code / Account Code Rollup ACTIVITY ID / WORK PACKAGE ACTIVITY ID / WORK PACKAGE Owner Reports Cost Overrun Past Due Activities Roll Up Cost Codes
    • 94. Manage Vendors and Self Perform Work View Today’s Assigned Jobs “Play of the Day” Including Resources, Material, Equipment. Categorized by: Sub Contractor’s Self Perform Work
    • 95. Assign Unscheduled Activities View Unscheduled Activities To Assign
    • 96. Attach Images and Notes from Field Insert User Based Reminder Notes for Daily / Weekly Tasks
    • 97. Activity Scheduler Schedule Daily Activities By Craft Expertise, Availability For weekly planning Joe’s crew is available and Is qualified to perform This weeks activities
    • 98. Organize Work Types and Categories Work Types By Classification Category Water Treatment
    • 99. Material / Inventory Reorder Alerts Receive Inventory Reorder Alerts On Material for Operations, Construction, and Equipment
    • 100. Vehicle Maintenance Management Real time updates visible in Control Tower Vehicle / Equip Assigned to Sub / Supervisor Update / Alert Vehicle / Equipment Maint. Records In the Field
    • 101. Past/Present View of All Activities/Resources/Equipment/Vehicles View Historic Activity/Resource By Activity ID View Current Location of Sub/Self Perform View Current Location of Equipment / Vehicles View Status of Jobs by Location No Service Required No App to Download No Batteries to Charge Native to Device
    • 102. Field to Control Tower Workflow Field Select Activity Select In Progress Select Complete Time/GPS Reflected in Record Updates from Field on All Activities Are displayed in Control Tower Status
    • 103. Safety Certification Reports / Meetings Daily Safety Walk Around Checklist Safety Qualification Meeting Requirements: Pre Construction Meeting Site Safety Orientation Foreman’s Site Requirement Review Foreman’s Meeting Safety Review Sub Contractor Insurance On File
    • 104. Quick Start Set Up… Leverage existing • Configure All Master Data • Employee Master • Inventory Master • Vendor Master • Equipment Master • Material Master Connect master data with Event Monitor for Master Data Updates
    • 105. Anatomy of a Project Vehicles Project Staff Schedule Job Equipment Job Skill Job Type Labor Rates Work Package Work Type (Activity) Material Unit Cost Hours Price Serviceable Assets (Recurring) Location
    • 106. Contact: Ron Babich Co-Founder/CEO Email: ron@dispatchlogix.com Telephone: 602-492-8940 THANK YOU 106

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