Capital project managers are working with Engineering Value Centers now more than ever. How can you build a solid relationship that supports high-quality work and good communication with people thousands of miles away?
This is a pressing question for Owner and EPC companies embarking on capital construction projects. Some studies suggest as much as 30 percent of all engineering on these projects will be completed by foreign-trained engineers working at value centers in developing countries like Indonesia, Mexico, Ukraine, Morocco, and India. This is partly because the demand for trained engineers far outpaces availability in developed countries.
Engineering Value Centers*, also called High-Value Engineering Centers or EVCs, also help bring project costs under control, and not just because the cost of doing business in developing countries is lower. According to a 2015 study from Independent Project Analysis’ Industry Benchmarking Consortium*, using EVCs consistently makes a project more cost-effective.
“The research shows that projects using EVCs generally have better drivers and therefore perform better than those that don’t,” study authors Dean Findley and Kate Rohrbaugh found. “When project teams have more cause to be wary, their due diligence improves.”
Still, the work is challenging. Project managers need to be diligent in setting up and documenting work plans, and in establishing communication strategies that support remote teams.
When our start-up team embarked on a multi-million dollar project building the world’s first Project Performance Acceleration Platform™, designed and developed to purposely serve the specific needs of highly engineered and complex capital projects, staffing quickly ramped up during our detailed engineering phase with various team members located remotely. A geographically distributed team, with different backgrounds, working cultures and time zones needed to be managed and handled in a more conscious and specific way.
First, once we got through our FEED, during which we froze our development scope, design after industry expert validation, we needed to well define our development work packages. Our leadership team quickly realized that our design work packages needed to incorporate the specificities and constraints dictated by the location of our staff, their competencies, and background.
As we continue to deploy our platform in diverse capital project environments, we are learning on a daily basis the importance of building in any project team the capability to work and collaborate remotely as a default functioning mechanism. Here are seven key steps to success that we learnt from our own experience as well as the experience of those brilliant teams and organizations we have had the chance to work with:
1 | Make communication skills and interface management a core competency.
A project interface is a boundary between two parties working on a project; you might also think of it as the point at which one person, team or contractor hands responsibility to another. In many cases, the interface exists at the point of connection between two physical systems that were developed separately – like an airplane fuselage and the electrical harnesses that connect it to the aircraft – but it can also be a key deliverable based on the combined work of separate teams.
For example, a remote team could benefit from focusing on the critical points of contact between their component design, planning, and assurance teams, to ensure that everyone knows when and with whom they should share information. Most integration teams focus on milestone planning and resource allocation, paying little attention to the quality of communication between teams. That needs to change.
2 | Establish a single point of accountability in cross-functional project teams.
Deliverables and associated requirements are more likely to fall through the cracks when remote teams are working together in an unorganized way. Making one person accountable for every deliverable – large or small – helps solve this problem. Adopting the single-accountability rule improves clarity around roles and responsibilities.
3 | Find non-intrusive ways to oversee remote teams and audit interfaces
Establish systems of continuous, non-intrusive monitoring and control. Leadership and management teams must be able to easily identify where there is a risk of miscommunication between the design, planning and execution teams working on the project. Consider the case of the Airbus A380, where development teams working separately in Germany and France failed to recognize that the plane’s fuselage was incompatible with the electrical harnesses. The failure to communicate cost the company millions of dollars in rework.
4 | Identify each risk, and make one person responsible for mitigating that risk
Identify specific risks associated with the remote work, record it in the project’s risk register, and assign a single person to oversee and mitigate the risk. For example, if foreign-trained engineers work to a different standard, assign one team member to review the work to ensure it meets the appropriate standard.
5 | Build bulletproof, automated work processes
First, strengthen your work processes around key deliverables. Then, keep your team on track by mandating the use of automated systems to move work through the established process. Instead of bringing the document down the hall for review, a remote team member will select “ready for review” in your automated system. Problem solved.
6 | Don’t assume that remote team members have a common understanding of the project objectives and requirements
Document the project scope, objectives, guidelines, communications and reporting protocols, corporate culture and anything other key drivers. Distribute these documents to everyone on the team and follow-up with alignment conversations. Make sure office engineering, planning and execution leads have the same understanding of these requirements. Get – and keep – everyone on the same page. Adopt and enforce the single-source-of-truth rule.
7 | Create a positive association with issue reporting
You need to know where the system is breaking down. Find an incentive that works for your team, and use it to encourage team members to report issues they encounter in their work. Alternatively, penalize the failure to report.
These simple strategies can dramatically improve performance.
If you are a capital project manager working in an asset-intensive industry, you are probably already working with a High-Value Engineering Center or other remote teams (and if you’re not, you likely will be soon). These seven simple strategies can help you to keep your teams in alignment, and ward of critical project failures that drive up costs and necessitate time-consuming rework. Start now and reap the rewards in the months and years to come.
If you’re looking for assistance in developing or improving your relationship with an EVC, the Concord team is here to help. Contact us today.
*Engineering Value Centers EVCs are engineering offices with hourly rates that are significantly lower than more developed regions. EVCs are used either independently as a subcontractor, within an Alliance agreement or in other cases acquired by the EPC company and integrated within its offer.