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Another Project Hit the wall by Eng Hisham Zeinoun

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Another Project Hit the Wall: Handling the Construction Industry Challenges through the Financial Crisis by eng. Hisham Zeinoun

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Another Project Hit the wall by Eng Hisham Zeinoun

  1. 1. Another Project Hit the Wall: Handling the Construction Industry Challenges & Crisis Eng. Hisham Zeinoun, PMP Dec. 27th, 2018
  2. 2. Session Outline • The Construction Project Life Cycle Overview • PMBOK concept & processes implemented in the construction industry • Impact of financial crisis on project delivery & completion • Handling the crisis & challenges through best practices • Lessons Learned • Q/A
  3. 3. My Story Why did I get into Project Management after 24 years operating in Construction Industry? Input – Project management Course Output –PMP Certified in 2015 and ?????
  4. 4. The Construction Project Lifecycle Overview
  5. 5. Product Life Cycle – Three Phases Product INITI AL INTERMEDIATE Ongoing Operations Business Case Idea Retirement Upgrade ? BusinessNeed Project Life-cycle Deep Dive
  6. 6. Construction Life Cycle – 4 phases Phase Name (s) Major Deliverables Decision @ end of phase 1 Feasibility Phase Project Formulation Feasibility Studies Strategy Design & Approval Project “GO” Decision 2 Planning and Design Base Design - Permit Cost and schedule Contract Terms and conditions Detailed Planning Major Contracts 3 Construction Excavation Civil Works Electrical Mechanical Testing Installation Substantially Complete 4 Turnover and Startup Final Testing Maintenance Full Operations 6
  7. 7. Influencing Factors on Project Lifecycle High Low Influence of Stakeholders Cost of changes Project Time HighLow Staffing Risks
  8. 8. Types of Project Life Cycles PREDICTIVE (Waterfall) ADAPTIVE (Agile)
  9. 9. What type of Project Lifecycle these construction projects follow?
  10. 10. Project Example 1 Existing Design Delivered
  11. 11. Project Example 2 Existing Design Delivered
  12. 12. Project Example 3 Existing Design Delivered
  13. 13. PMBOK Concepts & Processes implemented in the construction industry
  14. 14. PMBOK Knowledge Areas
  15. 15. Large vs Small Projects Large Scale Projects: • Commercial Centers • Multi Residential Buildings • Hotels • Beach Resorts • Governmental Buildings • Schools and universities • Hospitals Small Scale Projects: • Private Property • Villa • Single Residential Building • Project Manager, Owner, Client, Sponsor, Investor, Consultant, Contractor, Owner, Architect (Consultant) and Sometimes Project Manager STAKEHOLDERS INVOLVED
  16. 16. Project Management Process Groups Knowledge Areas Best Practices Challenge Project Integration Management • Developing Project Charter- Initiation (includes Business Case as Market Need, Conceptual Design, Budget, Tentative Schedules (Design, Permit Execution) • Direct, Monitor and Control Project Work – for small projects is implemented on structure and for large scale project on the existence of quality control officer • Develop Project Management Plan – Planning is Not implemented in most small scale Construction projects. Documentation is not implemented except for some large scale projects for Control offices • Perform Integrated Change Control – if the project managers are not fully empowered including cost management this process is not implemented by the book • Close Project or Phase – Mainly challenges are related with Sub-contracting model and Close procurement phase which is a predecessor for this process Project Scope Management • Scope Management (Define, Validate, Control) and Collect Requirements mainly covers products used and architectural design and work Create WBS- Not implemented in small scale projects Product Scope is not well defined especially with maintenance procedure and Guarantees Example: Project Scope - Basement Concrete Wall
  17. 17. Scope Management Example
  18. 18. Project Management Process Groups Knowledge Areas Best Practices Challenge Project Time Management • Define, develop and Sequence Activities is very diligently implemented since it has impact on funding, schedule, cost and resources availability and procurement schedule • Estimation of efforts is done mainly based on benchmarks except special products not implemented and not familiar to the market • Expert Judgements is implemented • small scale projects have no proper scheduling and control • Identifying and estimating some key activities in the later stage of the project are overlooked which are impacting the project schedule (in the absence of project manager) • Example: Floor Tiling Polishing Project Cost Management • Estimate Costs are done based on benchmarks • Determine Budget is well managed in projects where the project manager has full responsibility When the project manager doesn’t have full authority and control, the costs are not managed and controlled effectively.
  19. 19. Project Management Process Groups Knowledge Areas Best Practices Challenge Project Quality Management • Mandatory by syndicate of engineers for large scale projects and for concrete work only in small scale projects • Organization delivering large scale projects already have their Quality Assurance and Control Quality • Due to the lack of quality control processes mandated by the syndicate (only recommended) in small projects is creating conflicts between buyer and owner concerning the quality of the product Project Human Resources Management Large organizations have HR departments where all the processes of hiring, developing, assigning resources with the right capabilities is taken care off unlike small organizations where the PM is the owner and the HR manager and the PM at the same time Managing the skilled Syrian labor was a challenge before the law reinforcement of Sponsorship “Kafale” of internal security forces “Amen Al Aam”
  20. 20. Project Management Process Groups Knowledge Areas Best Practices Challenge Project Communication Management In Large scale projects planning, managing and controlling communication is well defined and implemented with the project team and stakeholders Lack of properly defined and managed communication is leading to conflicts and misunderstanding between the client and owner Example: the parking places allocated to 2 clients and not documented Project Risk Management • Site and worker safety measures to mitigate any risks of accidents • Bad weather conditions • Buffers in time schedule for unknown and unforeseen risks supported by contingency funds Risk Registers are not generally implemented in both large and small scale projects and organization which results no documented mitigation plans and risk responses hence no formal Qualitative and Quantitative analysis is conducted. No preventive actions or proactive risk controls processes are defined. Since Risks are NOT managed well , most of the projects are ending up in serious issues: above budget and behind schedule and/or incomplete
  21. 21. Project Management Process Groups Knowledge Areas Best Practices Challenge Project Procurement Management All procurement contracts are benchmarked based industry standards (example: Aluminum, Concrete, Sanitary, electrical, etc…) • Procurement scheduling challenge Example: Stone Cladding Ordering Project Stakeholder Management • Identify, Plan, Manage and Control Stakeholders Engagements are done well defined and implemented properly unfortunately the “Lebanese way” Stakeholders are identified and Managing the stakeholder the “Lebanese way” for Project success
  22. 22. Identify and list ALL the key stakeholders of a Construction project
  23. 23. Stakeholders in Construction Project
  24. 24. Handling the Lebanese Real Estate Crisis & Challenges through best practices
  25. 25. Players Ecosystem in Financial Community EXTERNAL CLIENT OWNER • Land • Cash Lump Sum • Down payment • Monthly payment • Bank Loan for Owner • Housing for Client • Investors The Problem Statement: Housing for Clients has been frozen! The impact is the client is not able to pay the amount and the owner is not able to close the contract with the client
  26. 26. Situation: You are in the middle of a Construction project and the ISKAN (The Housing Loan) has stopped funding. The Client has paid already almost 30% of the apartment amount and is not able to pay more unless he gets a housing loan approval. What would you do as a project manager? a) Nothing. You wait for the Housing loan to be approved and released b) Stretch the schedule by slowing down the project until the housing loan issue is resolved c) Complete the project with internal funding and try to find a resolution with each tenant on case by case basis d) Stop the project and return the money back to the Client
  27. 27. Lessons Learned
  28. 28. Lessons Learned  Consider “when to procure” or procurement schedule carefully while planning procurement management  Avoid scheduling some activities (external waterproofing, cladding …) during high rain probability months to avoid scheduling delays  Identify all stakeholders and keep key stakeholders closely engaged and involved  Take several samples and perform multiple pre-installation tests to activities that have no benchmarking  Consider many resources to each activity in a work package to reduce risks  Verify B.O.Q according to signed execution plans before signing any contract or subcontract  Documentation of approved and rejected change requests
  29. 29. My True Story: How did PMP Certification Changed my work life and Organizational performance from 2015 onwards after implementing Project Management principles and processes Improved Quality of deliverables Effective stakeholder management Better Management & Control Improved Cost control by 30% Improved Revenue by 300% times NET PROFIT BY 200% Customer Satisfaction & Loyalty 100%
  30. 30. Thank You!

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