Griffith School of Engineering, Griffith University 7201ENG Project Management

Semester 1, 2012

Assignment 2

Name: Marissa Adraincem Student Number: s2850497

Due Date: Week 13 28th May 2012

Task A (942 words)

Motorways of the Sea (MoS) project procurement/delivery system proposal
Maritime transport is the backbone of international business or commercial exchanges. As a result of globalisation, there is still more capacity of maritime transport in comparison with road networks. Bottlenecks because of traffic congestion will hinder socio-economic developments. Motorways of the Sea project is a concept that provides higher quality and reliable Short Sea shipping experiences initiated by the European Commission and the EU Member States. This is to promote cargo traffics from road networks to environmentally friendly sea-based logistical routes. Financial support if available from European Union for Implementation Projects such as port infrastructures, waterways, canal infrastructures; Facilities for logistics, safety, security, administrative, customs procedures, icebreaking and dredging operations and Studies for the project and pilot actions. Construction is the industry that involves in the infrastructure works of Motorways of the Sea. Construction provides the port infrastructures, waterways and canals and all the structures to be sued in the facilities. To be able to construct structures, the project needs materials, equipment, people and other resources that follow efficient progression. This efficiency requires a project delivery system. In this industry, there are common types of project delivery system which are Owner-provided delivery, Traditional design bid-build, Design-build and Design-build variation. In Owner-provided delivery, owners perform the design services and the construction work. On the other hand, Traditional Design Bid-Build is ideal on projects where the owner needs both professional design services and construction services while the Design-Build the owner contracts with a single company to provide the design and to construct the project according to the design. In the case of the construction of the structures of Motorways of the Sea projects, the ideal delivery system is the design-build. In this system, the client has the single contract for the design and construction in which the design-build contractor has the full responsibility of the whole operation and the owner give all the control of the projects.

The projects of Motorways of the Sea involve totally different kinds of infrastructure works that will require various forms of expertise that will call for the interest in using single vendor. Being a single entity of the vendor, there is an easier level to manage for the part of the owner. In this time of system, there is the advantage of time. Lesser time is involved in the whole process of design and construction compared to the other systems. It is also believed that design-build system can reduce the over-all cost of the project. Cost can be saved in the streamlining the process and the creativeness of the vendor during the design development. The Owner also has the security of a single responsibility compared to the other systems. Base on the history of constructions, this type of system has been always favoured for transportation and communication facilities and industrial projects which are included in Motorways of the Sea projects. This system also has lesser claim exposure, has newer technology and more innovative. There is also an over-all project optimisation compared to design-bid-build system. Other advantages of this system that is applicable to the projects of Motorways of the Sea can be seen on Figure 1.

Figure 1: Advantages of Design-build delivery system

Project procurement strategy and Risks In order to streamline the process of the Design-build delivery system of the projects of Motorway of the Sea, it is best to choose Partnering strategy. In partnering strategy objectives are agreed upon and dispute resolution and plans are established but partners still maintain their respective independence and may individually suffer or gain from the partnership while in alliance the parties develop a single cohesive unit that jointly shares all risks and rewards based on an agreement. Therefore if the project fails parties jointly share the agreed penalty. Alternatively, if the project succeeds both parties share the rewards. Partnering strategy is ideal to be used in the establishing of Motorways of the Sea since this will aim to nurture development of initiatives and encourage private sector involvements. Partnering strategy will support the type of projects of

Motorways of the Sea particularly the requirement of high quality projects which will demand high frequencies and huge investments. In this case, one of the partners will be responsible of the operations of a project of Motorways of the sea. This partner is an equity joint venture that is developed by both partners by their respective capital contributions. Like any most partnering strategy, although the partners retain respective independence there is risk-sharing. One of the risk involve is competition risk. This is a significant factor in Motorways of the Sea as European Governments are unable to enforce legal admission barriers for other competitors even to protect the vested interests in Motorways of the Sea. Therefore, partnering for projects of Motorways of the Sea will not be conformed to franchises as partners are still

threatened by competitors like any business entities trading or operating in the same industry. Other underlying risk for partners in projects for Motorways of the Sea is demand risk. This is present due to the fact that there are alternatives routes that is based on quality-price ratio, reliability of the service and time efficiency. In the case of Motorway of the Sea, demand risk is demonstrated on the change in transport practices of users of the Motorway of the Sea. Another risk is the operational risk that is usually present to moving markets that will compose the partners cost of operation. One of this is the volatile fuel prices, charter rate and ship prices thus compared to road infrastructures which is lower in operating cost and lower volatility.

Task B (1672 words)

Background of the project (project location, requirements and outcomes)
The project chosen was the construction of a Solar Chimney Power Plant. This project was based on the technology called Solar Chimney Technology that primarily will produce bulk electricity in areas that are hot enough and utilised 20-30 kph wind to operate turbines connected with generators. This technology is considered simple and reliable. It can be used to areas that have no water for cooling and are environmentally friendly. A solar chimney power plant involves with a solar hot air collector, a solar chimney and a turbine with generator. The solar chimney plant combines all of these elements as shown in Solar radiation is used to heat up air in a circular cover and the ground below will serve as a hot air collector. A vertical chimney is at the middle with airtight joints between the cover. Since hot air is lighter it will rise up and more hot air from the collector is sucks. Constant up-draught is produced and that energy is transformed into mechanical energy using the turbines and converted into electrical energy by using the generators. To construct a Solar Chimney Power Plant expected to generate electricity for some areas in North-western China. The plant will able to produce 110-190 kW monthly all year round. This objective is expected to be sufficient to address the power requirement of the said region. Other objective of this project aside from generating electric power is to use the solar collector of the plant as a greenhouse for the agricultural sector. One requirement of this project is a better solar radiation which can be found in this region compared to other parts of China. The solar power plant was constructed with a chimney of a height at 200 meters and a diameter of 10 meters. The diameter of the solar cover is 500 meters in order to produce electric power of 110-190 kW. The production of electric power of 110-190 kW of the plant is highly dependent of the regions solar irradiance and ambient temperature. Since the solar radiation of North-western China is better compared to other parts of the country, the plants component efficiency is higher in terms of power generation. Although the ambient temperature of the region did not have a pronounced effect of the plants power generating performance.

The project was defined based on what kind of technology was used which is Solar Chimney Technology and its required performance characteristics which is also the production of 110-190 kW electric power for North-western China. Its dual functions which are the production of significant amount of electric power and the project can also be used as greenhouse for agriculture purposes.

Project Control System

A week progress report is submitted to the project managers from each department head in order to determine the weekly status of the project. This was considered as the over-all project control system that was adapted. The reports was designed and formatted to precisely evaluate and accurately gave out important information that the project manager required. As a result, the project manager can monitor and keep well track the progress of the whole project. On the other hand, the project manager can control in terms of time, cost and quality performance that led to the success of the project. Parameters were measured in order to indicate and quantify the specific performance of the project staffs. Various techniques were used to facilitate that monitoring of the project. Aside from this, the over-all control system included a well-designed management information system, communication system, risk management system and audit system what all were reported to the project manager and top management of the organisation. Tools and techniques used in project control Earned Value Analysis (EVA)

This is the report that will indicate project progress. Final cost and completion date is forecasted, variances for budget and schedule were considered, and thus, control is indicated in terms of numerical data. These important variances and their causes drew immediate attentions from the project manager because theses will lead to projects delays. This performance reporting was an effective control tool for the project. This is based on the beliefs that performance can be quantify in terms of financial value and in the end will measure project performance efficiency. Therefore, the earned value is the value of work at budgeted rate.

Key performance indicators (KPI)

This tool aimed to generate continuous improvement in the execution of the project. The KPI was expressed in terms of ratios and percentages that in the long run the project manager kept track trends in work performance. In this case several KPIs were used to control and manage individual and group performance. Clear standards and requirements were used to base key job performances. Microsoft Project

In order to control schedule during the duration of the project, Microsoft Project was the software used. Costs and schedule was encoded daily to the system. All factors the will affect over-all costs were considered. This is a software program that was developed by Microsoft in order to assist project managers in establishing the weekly project plans, properly distributing resources for tasks, project budgeting, monitoring progress and workload analysis. On the other hand, by using this tool, the original schedule and forecasted schedule can be seen. Therefore, project scheduling can be appropriately achieved. Aside from monitoring critical tasks, this tool also determines project durations. This was the most effective tool in the management of the project. Control Process

Go/no-go control system was the control process adapted by the system. The established project plan parameters were always compared to the weekly collected parameters. This was in addition to the weekly progress reports that were submitted to the project manager and top senior managers of the parent organisation. In the first phase of the project, the comparison of the project forecast and tasks accomplished were met. At that phase, everything was completed according to the project plan. However, considering the isolation of the project location, supplies were not delivered on time the causes delays. Several planned procedures were cancelled due to these delays.

Project Control System Analysis

The entire project control system was developed that was mainly focused on project scheduling, cost control and reporting. Initially, an engineering estimate was prepared for the project as reference for the top managers of the parent organisation as well as for the project manager. This estimate was used for the parent organisations project cost in the purpose of budgeting and funding. The project control system was effective in regards to cost control since it identified potential problems such as delays very well before it will happen and at the same time evaluated the effect of these problems. In this regard, the project manager can then proposed actions to be taken to alleviate the condition and can do regular monitoring of project situations to effectively prevent uncertainty. The project control system in this case was more on the keeping the project in a no surprises situation. One of the elements of the project control system is the development of the project schedule that essentially was developed for monitoring the scope of the operations. This system was

developed under project control. In the weekly report to the project manager, this was based on the scope of the operations and was open for review and comments. Coordination meetings were held with the project manager and other workers concern following the weekly reports.

Figure 2. Earned Value Analysis Scenario (Panawatwanich 2011, Lectures Notes) In the implementation of the Earned Value Analysis (EVA) as shown in Figure 2, the schedule variance and actual cost are shown. This indicated that the project is on the right track in terms of budget. The report means that the project is under schedule and represented in the graph as negative schedule variance. In relation with the planned value, the actual cost to accomplish the task was stated. The Earned Value relates the planned cost and the status date. Although, the project experienced delays due to the delivery of materials, there were no major problems regarding not meeting cost objectives. The project control system was also effective in terms of holding down costs, delivering faster project schedule aside from anticipating problems. In this project, it was necessary to accomplish cost estimate before project execution. After performing the magnitude estimate, the cost values was corroborated and detailed cost estimate was established. Project schedule in Microsoft Project was adjusted and in the Earned Value Analysis forecasted project completion date and project cost was evaluated. In the middle of the project by using

these tools, the project schedules and work schedules were adjusted to arrive with the acceptable completion date. Microsoft Project and Earned Value Analysis were used in the improvement of the project control system during the duration of the project. As a result of this system, problems

encountered were appropriately evaluated and actions taken to solve these problems were more on a team work approach. Over-all, the project control system was deemed successful in achieving the projects goal and objectives.

Conclusion
To summarised, the project control system used techniques and tools to appropriately implement the system. Primarily the submission of weekly progress report to the project manager was done to emphasise regular monitoring in terms of percent complete and earned value. empowered the project manager to focus resources toward achieving project goals. This These In

reports also enabled the project manager to anticipate problems before it will happen.

response, the system helped provides the development of the solutions of these problems. The process control system also facilitated to meet the cost and schedule requirements that were established before project execution. In order to improve the process control system in this case, project risk assessment should be integrated to the project weekly progress report. Since the delays of the delivery of several importance materials were the primary factor and other related logistics problems that is basically due to the projects location, risk management will be a great advantage for process control.

References

Alhazmi, T & McCaffer R 2000, Project procurement system selection model, pp. 176-184, (online EbsCohost). Dai, Y, Huang, H & Wang, R 2003, Case study of solar chimney power plants in northwestern regions of China, vol. 28, pp. 1295-1304, (online Science Direct). Kraus, W 2007, Successful implementation of effective project controls systems, vol. 49, no. 11, pp. 3-4, (online ProQuest Central). Li, W & Carter, D 2002, Project control system development for a design/build project, vol. 44, no. 3 pp. 39-47, (online ProQuest Central). Lock, D 2000, Project Management, 7th Edn, Gower Publishing Limited, Vermont. Maylor, H 2003, Project Management, 3rd Edn, Pearson Education Limited, Essex. Nicholas, J & Steyn, H 2008, Project Management for Business, Engineering and Technology, 3rd Edn, Butterworth-Heinemann, Burlington. Zhou, X, Wang, F & Ochieng, R 2010, A review of solar chimney power technology, Renewable and Sustainable Energy Reviews, vol. 14, pp. 2315-2338, (online Elsevier).