Recently, Coreworx ran the 4th annual Project Excellence 2012 Conference. This year’s event took place over 2 days with the first day focused on providing our existing Coreworx clients with tips and techniques, as well as an overview of the Coreworx product roadmap. The second day was dedicated to the state of the world as far as capital projects and capital assets are concerned. Our speakers at the industry event ranged from consultants focused on best practices in project management, to industry experts who have honed their skills on project builds, turnarounds and shutdowns.
One of the big themes of the event was the importance of interface management in ensuring successful project execution. As one individual stated “Through my 30 years in major oil & gas projects, I have learned that interface management is a key factor to success.”
The reality is that managing a $50 million dollar project and managing a $5 billion Mega Project is very different. As projects expand, Owners cannot simply outsource to a single EPC and be successful – as projects grow, so does the complexity and the number stakeholders. As a result, Owners along with Major EPCs need to take an active role in managing the interface points between all stakeholders.
With mega projects, the risk of cost growth without properly managed project interfaces is tremendous. Industry experts indicate that Interface Management issues can account for up to 20% of a project’s cost.
Obviously the risk of cost growth is substantial, but how does Interface management help and why is it important?
Interface management is first and foremost, all about communication. It is the control and oversight of technical interactions and information flow between all the parties involved on large, complex, often modular-based mega projects.
A typical mega project can have anywhere from hundreds to 10’s of thousands of interface points to manage. That combined with the fact that stakeholders are often dealing with cultural and language differences, time zone differences, and various geographies means that owner organizations and major EPCs need to broaden their approach to managing project interfaces. Without proper management of those complexities things can go very wrong, resulting in huge cost overruns and delays.
Interface management offers a way to work through the ‘grey areas’ that always exists between contractors.
Ultimately proper interface management will benefit projects through:
- Risk Mitigation – manage liability and risk including litigation
- Ensure Compliance – influence consistency across scope packages
- Cost Reduction – minimize rework at commissioning
- Knowledge Management – retain IP from project to project and provide knowledge transfer as the project moves to operations
It will be interesting to learn how complex projects will evolve for our clients as they adopt interface management strategies, particularly through the use of Coreworx Interface Management. Project Excellence 2012 was an exciting event and I’m looking forward to future events and future learnings.