By: Scott Cameron, PRG Advisor
A plant consolidation project I worked on had a 50% to 90% rate of return/investment (ROR/ROI). The closing plant supported six Businesses and the plan was to relocate these Businesses to four different sites. The project manager (PM) was new to his position and was eager to try some innovative execution techniques. His execution strategy called for a minimal contract engineering and construction effort, and thus costs, and use existing plant technicians/managers and Corporate staff to relocate the existing manufacturing equipment to the four new sites in addition to their current full-time jobs. The project team and management supported this plan.
Unfortunately, the first Business relocation was 30% over its original budget, late, and did not meet the original target production goals. Following the first relocation, the PM resigned and I was assigned as the replacement PM. After reviewing the project status, I determined the project’s original execution strategy did not have the proper Business focus nor was the original stated capital cost and staffing sufficient. The original strategy failed to guarantee each Business relocation would not be interrupted, but rather focused on minimizing Contractor costs to reduce project costs. The basic assumption that the existing personnel could execute these projects in addition to their current full-time job was flawed, in my opinion.
Rather than trying to make the best of the original plan, a new execution plan was defined including a formal strategy to move each Business to its new location. Engineering/project teams were defined for each Business and given specific cost and schedule targets. Other than an increase in the original project costs, each team achieved the desired savings and business success criteria.
As the PM, I learned how crucial it is to carefully examine and develop an execution plan capable of delivering the Business need. If the initial execution plan is unable to deliver the Business need, a PM must have the flexibility to revise, recalibrate and convince their management to alter the original plan.
The Premier Resources Group’s (PRG) Advisors can help your Company avoid this type of problem by helping to identify any misalignment between your Management and the project team’s project scope/estimates/schedule and business needs. PRG Advisors can be brought in during any project phase to provide independent and unbiased evaluations through their vast Industry experience to promote successful and timely project completion.