Faster Project Execution:

New approaches for the Future

r Project Execution: New approaches for the Future NOCET-2010

NTPC Limited, Korba

Faster Project Execution:

New approaches for the Future
TEAM MEMBERS:
Mr. Ashish Shukla [Sr. Engineer (O&M-EMD)]
Mr. Prasanjit Roy [Engineer (O&M-OPR)]
Mr. Deepak Choudhary [Engineer (Civil Erection)]
Mr. Pallav Dutta [Engineer (O&M-OPR)]

No. of words: 4952

Date of Submission: 07/10/2010
Signature of Team Leader:

[NOCET-2010]

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EXECUTIVE SUMMARY
In the last fifty years, the project management body of knowledge has evolved a lot but
the world of projects has not shown commensurate improvement as far as execution is
concerned. Numerous studies conducted over the years prove that existing project
execution practices are not very effective. Project execution is a challenge and the
current situation is unsatisfactory, not only in the Energy sector, but across all
industries.

From NTPC point of view, approximately 20,000 MW capacities are in various

stages of construction presently. For an organization like NTPC which has added
32,194 MW in approximately 35 years, this figure represents a growth of 66% in just
one third time of its total span.

Also from financial perspective, NTPC’s balance sheet shows that total gross
revenue generation is 48000 Crores and approximately 38000 Crores are employed
for capital works in progress (78% of total revenue). It shows that NTPC is resting on a
very delicate equilibrium of Return Vs. Investment. As majority of returns are invested,
the success of these becomes crucial.

The inefficient project execution results in cost & time overruns and in the new
era of competitive & globalised world, faster project execution provides faster returns
on investment, frees up resources for next projects thus providing a sustainable
competitive advantage. The question, therefore, is not whether to speed up project
execution, but how to go about it.

In dealing with the topic “Faster Project Execution: New approaches for the
future” our team did our research, surveys and brainstorming based on our own
organization NTPC. We analyzed various projects(under construction/ executed) of
NTPC , tried to find out the brighter side and darker side of our project execution
experiences and looked for scope of improvement. We also studied some external
projects such as DMRC Limited, which had set execution benchmark. Based on these,
we identified certain key approaches which enable faster project execution by keeping
in mind the current hurdles & issues.

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What projects need is a powerful solution which ensures reliable execution of project
plans through Agile & Lean Processes & Systems without falling into the trap of a more
detailed plan.

We suggested Critical Chain Project Management (CCPM) combined with the Agile &
Lean Project Management method because of its unique ability to accommodate and
manage uncertainties & resource contentions efficiently and their ability to avoid
wastages of time and capacity.

At the end we suggested a roadmap for implementation to fill some of the voids in
various areas of project execution & increase the cohesion for synchronized & faster
Project execution. Certain best practices with good interface between various entities
like man, money and material can help improve overall project planning

Finally we concluded that faster Project execution is basically a management culture,

which requires an Agile & Adaptive Team, ready to challenge the conventional
percepts with Leaner but effective sources. It requires Clear Objectives, Streamlined &
Flexible Processes & Optimized & Decisive application of Resources coupled with use
of Latest Technology.

“Victory requires not the largest force, but the most effective one,
applied at the critical point, within a narrow window of opportunity.”

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INDEX
1. Introduction
1.1 What is Project?
1.2 Project Execution
1.3 The age old problem
1.4 Need For Speed
1.5 Benefits of Faster Project Execution
2. Details of the Research Work
2.1 Research Methodology
2.2 Primary Research - Survey
2.3 Secondary Research – Case Study
3. Analysis of Data
4. Findings
4.1 NTPC’s project execution: Retrospection
4.2 Analysis of Delay
4.3 SWOT Analysis
5. Recommendations- New Approaches for The Future
5.1 The solution: (UN)common sense
5.2 Understanding the new environment - Planning
5.3 Synchronizing project execution
5.4 Focus Your Resources.
5.5 Change management
5.6 Multi-project scheduling-CCPM Way
5.7 Agile & Lean Project Management
6. Roadmap For Implementation
6.1 The Art of Execution: Doing More, Faster, With Fewer Resource
A. General Perspective
B. NTPC Perspective (Provided in Annexure)
7. Conclusion
8. References
9. Annexure

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he Age Old
“FASTER Problem
PROJECT EXECUTION: NEW APPROACHES FOR THE FUTURE”

Introduction:

What is a Project?
A project is a time and cost constrained operation to realise a set of defined
deliverables (the scope to fulfill the project’s objectives) up to quality standards and
requirements.

Project Execution
Project execution in reality involves the work for a project from “Concept” to
“Commissioning”. It includes conceptualizing a project, carrying out a feasibility survey
to justify the concept, seeking proper finance on the basis of feasibility report, seeking
statutory and regulatory clearances, selection of vendors and agencies for completion
of project, engineering and design, procurement and logistics, construction and final
closeout of the contract.

As stated above, project execution involves a plethora of jobs involving cross

functional activities. Thus it has to be made very clear that “construction” is not the sole
activity of a project. Finance, Engineering, Contracts, Procurement, Quality and
Inspection services, HR and Personnel, Construction and project management group
are all equally responsible for timely completion of a project.

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The Age Old Problem

In the last fifty years, the project management body of knowledge has evolved a
lot but the world of projects has not shown commensurate improvement as far as
execution is concerned. Numerous studies conducted worldwide over the years prove
that existing project execution practices are not very effective. (See Fig. 1)

Figure 1.

From the Indian perspective, Sector-wise analysis of the cost and time overrun
of projects under implementation shows # that the scenario is not very different be it
energy sector, mines, steel, Transport sector or Information technology, project
execution performance has been as bad as before (See Annexure B). Such is the
importance placed on project execution performance, that projects which are delivered
with full scope, on time, and within budgets make it to newspaper headlines.

Need for Speed

Execution speed has always been critical in any industry, especially true for
energy sector in view of prevalent supply demand mismatch & future requirements
based on GDP growth of India.
#
Source: Annual Report 2009-10, Ministry of Statistics & Programme Implementation, GOI

There is an increasing gap between India’s Power Sector capacity addition’s

$
planned Target & achievements in recent times thus creating need for faster project
execution. (See Fig. 2)

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96.2

84.6 81.6

64.2
72.3
64.3 47.2
53.8 51.5
49.4

Source- Planning Commission, Government of India

Figure 2.

Even If we assume a moderate 8% GDP growth in the coming years, the power sector
growth rate has to be more than the GDP growth rate in order to meet country’s power
needs. (See Fig. 3) To fill the gap between the supply – demand mismatch & to
achieve “Power for All” by 2012, NTPC Limited has set an ambitious target of 75000
MW Company by 2017. From NTPC point of view, approximately 20,000 MW
capacities are in various stages of
construction presently. For an organization
like NTPC which has added 32,194 MW in
approximately 35 years, this figure
778 GW
represents a growth of 66% in just one third 425 GW
132 220
GW GW
time of its total span.

Mar-07 2012 2022 2032

Source: Integrated
Demand
Energy Policy GOI
considering 8%
Figure 3.

$
GDP growth
Source: Planning Commission, GOI

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As we can see from fig. 4 NTPC has an aggressive target of more than Double the
Capacity within 1/4 of the available time when compared with the present scenario.

Figure 4. NTPC Future Capacity Addition Plan

Also from financial perspective, NTPC’s balance sheet shows that total gross revenue
generation is 48000 Crores and approximately 38000 Crores are employed for capital
works in progress (78% of total revenue). It shows that NTPC is resting on a very
delicate equilibrium of Return Vs. Investment. As majority of returns are invested, the
success of these becomes crucial.

Industry estimates shows that the capacity addition cost is approximately Rs. 4
Crore/MW in power sector; whereas project execution delay of one day results in Rs. 2
Crore loss means it would have created a 0.5 MW capacity if employed otherwise..

The new liberalized & competitive environment in power sector also creates a
need for speed in project execution for NTPC so that it can sustain its present market
share in the coming years as all the future projects are going to be allotted on the
basis of Tariff Based Bidding from 6th j=January 2011 onwards and NTPC’s strategy is

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to be reviewed critically regarding Power project’s Tariff Based Bidding in the view of
recent Ultra Mega Power Projects (UMPP) biddings.

Apart from the above market forces there are other benefits of faster project
execution which needs to be considered as follows.

Benefits of Faster Project Execution

The benefit of faster execution is straightforward: the faster the infrastructure is
built, the faster it starts generating returns on the investment.

Faster project execution is equally critical to the equipment and machinery suppliers
for these infrastructure projects.. Faster project completion frees up manufacturing
capacity to start the next project sooner. By improving execution, equipment
manufacturers with severe backlogs can capitalize on peak demand and substantially
improve their bottom line. Moreover, faster execution can also become a source of
competitive advantage for these suppliers.

Moreover, time equals money not only from an income perspective but also from a
cost perspective; the longer a project takes, the more it costs . With projects
becoming more and more complex and capital intensive, there is a driving need to
change the way execution is managed.

The question, therefore, is not whether to speed up project execution, but how to go
about it?

When we ask this question to numerous project managers, we hear responses like:

 “the plan and the initial estimate has to be detailed and perfect”

 “the project should have the best possible resources when required”

 “vendors supplying to the projects have to be perfect”

 “requirements should be frozen upfront”

Such requirements can be met only in a perfect world -a world free of uncertainties.
But project environments are unique – the next project will always be different .So, by
the time, the company is ready with all the knowledge, processes, and skills, the
requirements of the next project appear to be very different from the earlier one and
one has to start all over again. The effort to reduce uncertainties seems like a never-
ending journey.

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The problem is even more profound in a multi-project environment, where resources

are shared across projects. Resource dependencies, both within and across projects,
increased number of integration points in the project which leads to problem of
cascading effect of delays from one project to other.

Details of the Research Work:

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A. Research Methodology:

Figure 5.

B. Primary Research:
1. Survey:

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Our team has conducted a survey among NTPC executives

particularly those working in project sites, corporate planning, corporate monitoring
group and higher management to know the projects execution impediments & their
suggestions for faster project execution of various NTPC projects. Our Survey was
consisted of a questionnaire (see Annexure C) for assessing impediments to project
execution, effectiveness of NTPC’s project execution strategy in totality & the
solutions required.

Analysis of Data: Sample Size- 27 Executives of NTPC

Figure 6 & 7.

Figure 8.

Figure 9.

Figure 10.

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The cost of construction at   200 Crore per kilometer lowest in the world in case of
Metro Rail.

In 2007, the delhi metro claimed to be one of only five metro system in the world that
operated at a profit without government subsidies.

Figure 11. Comparative Study of World’s Metro Rail’s Project

Major Strategies in Project Execution

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Major Strategies of DMRC

Autonomy

Through Effective
Planning Project
Design
Project
Use of Latest Manager Adaptive
Technology Organizational
Culture

Quality Managing
Goal Assurance Stakeholders
Team Resolute
Clarity Leadership

Figure 12.

Figure 13.

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Findings:

NTPC’s project execution: Retrospection

If we look at our past performance in project execution we were excellent in project

execution and often set benchmarks for others to follow. Tables below show our
glorious performances:

Figure 15.

Figure 16.

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However our recent project execution experience can best be described as

some brilliant performance followed by some very shoddy performances. Table below
shows some of our recent project execution datas in chronological order:

Figure 17.

The data reveals that Dadri units were completed before schedule. However there
were huge delays in executing peer projects like Kahalgaon and Sipat. Moreover,
there are some exceptional cases like stage-1 of both Sipat and Barh which are
indefinitely delayed for a long time. These delays are causing the slippage of target
achievement of power generation by GOI with variance with target has been as high as
50%.

96.2

84.6 81.6

64.2
72.3
64.3 47.2
53.8 51.5
49.4

Source- Planning Commission, Government of India

Figure 18.

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Figure 19.

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Recommendations:

Key approaches for faster project execution

While the execution problem is complex, its solution need not be. What is needed is a
proactive program to move steadily from a firefighting culture to a root-cause
performance improvement culture. It is not easy, but if you cannot make this journey,
your business will be easy prey for a competitor. What's needed is an elegant solution
that solves the execution problem while making the work-lives of first line managers
and projects managers easy.

Information derived from analysis of past experiences, survey, brain storming,

study of external projects and SWOT is used to construct a strategy that will enable
faster project execution. We have zeroed down a set of key approaches which we
need to adopt as well as reforms required in the existing system for better project
execution.

A. Understanding the new environment - Project Planning:

The project planning process will identify technical gaps related to the project
execution, various governmental & statutory clearances, quality standards, governing
documents, verification, erection, commissioning & operation.

A new idea was presented to look for project patterns – i.e. projects of similar type and
content. A number of patterns emerged and became the new cluster team structure.
Each cluster team should be responsible for delivering all projects of that type and for
methods and project process development as well. Guiding principles for new project
portfolio management are:

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B. Synchronizing project execution

Synchronized project execution challenges conventional wisdom and changes three

main precepts of project management.

 Focus Resources on fewer streams of work at a time – eliminates multi-

tasking and the need for individuals to decide which of multiple tasks they
should work on first.

 Focus on finishing the project on time – requiring tasks to finish on time only
induces people to build safeties (local buffers) into their commitments.
Eliminating the focus on individual task deadlines and implementing an overall
project buffer allows the entire project to be finished sooner. The final project
deadline is the only deadline that really matters.

 Focus on task prioritization – Tasks that are consuming the most project
buffer are given the highest priority to keep the entire project on track.

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Engineers and crews focus on a single task at a time and, when finished, are
given a new task based on priority.

Since the entire organization works towards the exact same set of priorities,
synchronization improves, work flows faster, and productivity increases. The status of
the project buffer also provides early warning signals so managers can react before
problems become worse.

Real world example:

Engineering organizations and project-based manufacturers around the world have

implementing this new Project Execution Management method to shorten delivery
times by 20% to 30% and increase productivity by 15% to 20%. These types of
savings in any industry can dramatically increase profits and accelerate cash flow for
all participants in the infrastructure supply chain. (See Annexure)

C. Focus Your Resources:

We have several tactics here:

 Always remember that deciding what you are not going to work on is as important
as deciding what you are going to work on. Management has to set a hard rule and
stick to it. Backlog means backlog. The initiative does not get worked on until it is
activated.

 People working on sustaining activity should not generally be assigned to critical

projects, and vice versa.

 Limit the number of projects any individual is working on. Involvement in too many
projects causes overloading.

 Create a management process to escalate problems quickly. It is important to find

out what the conflict is and resolve it quickly.

Following these basic principles will help you keep people focused on the projects to
which they have been assigned.

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D. Change management

Putting the new method in place and sustaining the new rules requires the
implementation of a complete execution management system that includes:

Operational goals and measurements to achieve business goals.

Operational goals include targets for

 Cycle time reduction;

 Improvements in throughput;

 Due-date performance and

 Measurements that promote execution according to synchronized

priorities and early warning signals.

Management policies and processes to enforce the new rules, as well as

translate these rules into decisions and actions readily understood by all.

Execution-oriented project plans with enough detail to provide good

execution priorities, but not so detailed that control becomes difficult.

Enabling softwares & technologies that help managers prioritize and monitor
the release of new projects, put buffers in the right place, and synchronize day-
to-day priorities and alert managers to potential problems.

Real world example:

After implementing a Project Execution Management system that includes the

elements described above, one Houston based manufacturer, designer, and
implementer of systems and equipment for a wide range of heavy industries, was able
to complete the design engineering of a first-in-class class rig in 35% less time than it
took using traditional project management methods, creating six months of extra
capacity. In product engineering, a hull structure design was completed in 44% less
time, dropping from nine months to five months.

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E. Multi-project scheduling:

The project plans build in “CCPM way” have buffers removed from the tasks (task
durations are made aggressive and seemingly unrealistic-with just 50% chances of it
completing in the planned duration) and placed at critical points where it matters the
most -at the point where the feeding path meets the critical path and at the end of
critical path.

Figure 20.

In a multi-project environment, instead of projects starting ASAP, projects are released

into the system based on the capacity of the most loaded resource. This helps in
controlling the work in progress and the associated multi-tasking. These buffers (also
called as project tolerance) are a block of unscheduled time which absorbs the
uncertainties of the project during execution. Since the buffers are aggregated at
critical points, the overall buffer requirement is less than what one would require when
they are distributed to individual tasks. The project lead time is reduced right at the
planning phase. With buffers removed from the tasks, the effect of student syndrome
and Parkinson's effect is drastically minimized.

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F. Agile & Lean Project Management:

On the experiences from the study of the six companies and inspired by the literature
on Agile Thinking, we have developed a conceptual framework for agile project
development. We also included elements of Lean Thinking by introducing the notion of
Agi-Lean, This led us to introduce four interdependent elements, as shown in the
figure on the next page.
AGILEAN
AGILE = Value-oriented, Quick, Nimble, Flexible
AGILEA
LEAN = Value-oriented, Slim, Simple
N

 Agility in the individual projects is a pre-requisite for achieving agility in the

portfolio of projects.
 The resources employed are also agile.
 Similarly management should be prepared to support the idea by also applying
agile principles to their own decision-making behaviour.

The framework emphasizes that agile company development implies a development

effort in a four parallel areas, cf. figure 1

Figure 21. The Elements

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The Agile Resources

 Competencies, i.e. the actors should have a broad competence to work with
high flexibility in the projects. The actors should be empowered and trusted to
be able to decide and act in many matters.
 Mobility, i.e. the resources are manageable and able to be moved around with
the result that they quickly and effectively can be reallocated to other tasks.
 Effectiveness, i.e. persons work on individual tasks with high intensity and
effectiveness. Focus is on creating value in activities and waste of resources is
kept at a minimum.
 Capability to implement, i.e. rapid and effective implementation of project
deliverables. The company is capable of transforming the project results into
operations.

The Agile Project Portfolio Management

 Resolute management, i.e. a fast decision making process for projects in

progress, and the portfolio owners and project managers should be competent
to act with due regard to the portfolio at large.

 Lean administration, i.e. management of the portfolio should be implemented

with a slim, but effective administrative effort and with transparency for actors.

Figure 22.

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The Art of Execution: Doing More, Faster, With Fewer Resource

General Perspective:

Now that you have decided what is most important, have aligned the functions, and
assigned resources to the task, you have only won half the battle. There are some
other rules of world-class execution that you need to understand in order to
successfully implement your plan:

1. Goal clarity: In project execution process, everyone needs to understand the

goal. In practice, there are multiple goals that sometimes involve trade-offs, and people
need to understand both the goals and the trade-offs in order to make good project
execution decisions.

2. Crystal-clear Accountability: is critical to the success of any business

process, and equally important for driving an aggressive program of fast project
execution. The route to a culture of accountability starts with an effective set of
management processes to drive accountability. If we put these in place and use them,
the culture will follow.

3. Synchronized Execution:

 Frontline supervisors need clear task-level priorities, within and across projects.
 Moreover, highly urgent tasks should be highlighted so that managers can focus
their attention and take extraordinary actions where needed.
 Project managers need early warning signals to spot problems that threaten project
completion

4. Cross-functional team environment: In any project, a single function in

isolation cannot deliver value to the customer Thus, significant execution
improvements in your project requires the active involvement of all functions that
touch the processes, collaborating in a cross-functional team environment, under
the direction of a process owner.

5. Effective Project Review: Project teams should meet on a regular basis; with a
standard meeting agenda and processes along with indicators measuring Review

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Meeting Effectiveness, and higher-level management teams should also review

projects on regular basis. Without this, key initiatives will move too slowly or even stall.

6. Measurement Metrics: Metrics are one key means to ensure accountability and
are most easily leveraged through a review process similar to the one described
above. However, some of the most important attributes of an effective measurement
system are not widely understood.

 Measure your processes, not just your functions.

 Balance historical metrics with forward looking ones.
 Balance results metrics with drivers.
 Ensure your metrics are hierarchically linked.

An organization who followed the steps described above could certainly expect to be
victorious in the battle of faster project execution resulting in increased asset velocity
which carries lower risks, and frees cash to reinvest in the business, providing a turbo
boost to business performance initiatives.

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Roadmap for Implementation: NTPC Perspective:

Project Planning

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Infrastructural Issues: New approaches

Issue Target
Site Infrastructure A well developed Infrastructure before Award of Main Plant
Development Package should be in place.

 A single Package for Site leveling, Boundary wall,

construction of Drains, construction water & power works,
Laying & repairing of Approach roads & Hard Crusting &
Reinforcing before every monsoon till the project completion.
 A single package for construction of Shaded Fabrication
Yard, Storage Sheds and Office etc.
Township Infrastructure  A single package for development of township (quarters,
Development schools, hospital) including site levelling & boundary wall
construction may be awarded in place of small packages to
attract big developers.
 Concept of Temporary Township is to be avoided.
 Labour colony development should be included in the scope
& should have proximity to the site
 Hospital and schools: Hospital facilities and schools for
children should be taken care of well in advance so that
these will not create any work life imbalance to the project
people..
Site levelling  Site levelling of priority area takes about 6 months. This
needs to be awarded about 07 month before Main Plant
NOA.
Underground Drains, Pipe  Upfront engineering and execution of underground services
& Cable trestles and path based on standard data.
 Use of Prefabricated Structures.
Initial Accommodation  Portable cabin may be considered as part of the enabling
township for speedier development of the projects.
Site Heavy Equipments  Corporate Rate contract for hiring of “major equipments”
such as high capacity cranes on chargeable basis or free of
Infrastructures
cost to Agencies wherever required. List of such equipments
required to be provided should be finalized during freezing of

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specifications / bid documents.

 Construction equipments like hydra, Pocklain, JCB, winches,
dozer batching plant etc. to be available with NTPC /
outsourced from the start of the project, so that if the
contractor fails to mobilise the same at site in time, these
can be rented to them.
 High capacity cranes are to be located strategically till the
completion of Main Power House, Bunker House, ESP VFD
Bldg, Service Bldg, for structural erection. These locations
have to be identified in the Plant Layout.
External Infrastructure: Lack of good road connectivity was major reason for delay in
arrival of key equipments in many projects (e.g. Sipat,
Connectivity to national
Kahalgoan).
highway, railways, ports.
 Rigorous planning for transportation of critical equipment for the
project to be done at the beginning.

 Routes chosen are to be thoroughly surveyed for any bottlenecks

considering the worst case scenarios
 Liaison with the government for as per site requirements

o Development of waterways for transportation of

equipments
o Railways’ connectivity with Ports,
Construction/Augmentation of Port capacity
o Strengthening of NH & state road network
o Exclusive posting of land acquisition officers by
State Govt (e.g. Simhadri model )
IT infrastructure at site NTPC should provide easy access to its IT infrastructure to
the contractor also.

5.2 Engineering & Design Issues: New approaches

ISSUE TARGET
Standardization  We need to have standard Layouts for different

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configuration of Units viz, 2x500 MW, 3x500 MW, 3x660

MW, 3x800 MW, 4x800 MW etc. This shall

 save time of NTPC/ Vendor and

 will facilitate interchangeability during O&M.
 to facilitate smooth work progress &
 faster front handing over.

 Standardized procedural manual & guidelines in the

areas of erection, testing, commissioning & problem
solving.
 Standardization of Field Quality Plans to be made a part
of bid documents.
 Standardization of trestles will lead to early start of
trestles fabrication/erection.
 Use of Mechanical /Hydraulic Pile Breaker to increase
the speed of pile breaking
Request Change Management  There should be a Request Change Management
System System (RCMS) for requiring engineering/design
change. It will ensure

 quick solutions,

 better documentation &

 enhanced accountability.
 Concept of deputation of Engineering Personnel at site
to expedite engineering/Design related problems (WAR
room concept).
 Pre Fabricated structures to be adopted for Main
Power House & All buildings; this shall
 save the fabrication time as well as
 area at site and also
 ensures better quality.
Integration of Mill & Integrate MILL & BUNKER BAY with Boiler Structure –As
ONE SINGLE FRAME to Save space, cost & resource
Bunker Bay

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interface.

5.3 Contracts & Procurement Issues: New approaches

ISSUE TARGET
Delay in supply of Capital  Procurement of capital equipments for multiple projects
& Other Equipments through single bidding process. It will
 Save time.
 Save cost.
 Enhance flexibility.

 There should be a methodology to ensure Sequential supply

of material. Sequential material list with a dedicated project
team should be made to follow up & to avoid dumping of
material by agency well ahead of execution time. Receipt
payment against supply to be made only after erection of the
corresponding items.

 Material expediting and availability is to be ensured with

respect to L2 network.
 NTPC has to give maximum emphasis to the following JVs as
they will play key role in the material availability for future
projects.
o JV with BHEL for manufacturing of power plants (NTPC-
BHEL Power Project Pvt Ltd)
o JV with TELK for manufacturing/repairing of high voltage
power transformers and associated equipment.
o JV with Bharat Forge Ltd for manufacturing of casting &
forgings.
 Enhancement of Qualified / Approved Suppliers as existing
are already overbooked.
 A JV for pre fabrication near the raw material plant should be
developed so that tailor made items will be readily available
to different projects from a single source.
No of Packages & lack of  Lesser no. of Packages to reduce interface issues / NTPC

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standardization inputs (eg: Simhadri) .Even in recent package allocation,

there is a lack of standardization in the packaging which is to
be seriously thought.
Delay in award of  The Award of balance of plant packages (BOP) requires equal
emphasis as main plant as in some of the projects COD were
BOP packages
delayed due to delay in BOP execution.
Dispute resolution in  Efforts to resolve the disputes concurrently with review of
flexibility and speed especially relating to mid course
Contracts
technical variation.
 Planned alternative course of action for non performing
contractor.
Selection of Vendors  Selection of vendors through Vendor Indexing. Vendor
indexing will depend upon past execution record, financial
stability & credentials of the vendor, effective availability of
manpower & resources for the concerned project etc.
Enlistment of Agencies  NTPC should have MOU/ rate contract with reputed civil
agencies - (best practices of DMRC), Cement companies and
Steel manufacturers.

 Enlistment of Civil Agencies.

Finalization of sub-  CC& M to ensure that the sub vendor for the package is
vendor by the principal finalized within three months as the broad scope for the
vendor award is known when the basic Engg is completed.
Separate contract for  Test Pile package to be separated and to be executed as
Piling soon as the land is acquired. Sample piling should be of
similar size to an actual pile.-Learning from Korba
Allocation for Safety in  Part of RA Bill (say 5 %) is to be earmarked for Safety
contract compliance

Poor mobilization of  Certified work force concept should be ensured in contract to

manpower & resources ensure adequate skilled manpower.
 Wherever contractor fails to provide front in time due to lack
of mobilization of manpower & material, the risk & cost

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management should be done by HOP if the cost is within the

limit, & If possible, L2 contractor should be given chance
immediately.
 Two different agencies should be awarded the contract
instead of one for parallel execution of job.
 Interim L2 revision/penalty on milestone basis may be
considered and provision should be made in the contract.
Incentives for early completion of contract / mile stones need
to be thought of based on “Best Effort Schedule”
 Geographical factors to be considered while finalising
package list, T&Ps and vendor selection.
Pre-award and post  Review QRs for increased competition
award approval process
Payment Complexity of  Avoid Item rate contract, wherever possible, for reducing
Contract extra work & time.
 Avoid composite items & split them in segmental activities, to
facilitate progressive payment to improve the cash flow.
Availability of Contract  Contract documents should be readily available digitally &
Details accessible right at the award stage.

Miscellaneous

Issue Target
Core Team  Early posting of ‘Project in-charge’ as the key person for all
identified projects (from FR stage).
 Posting of core team and sanction of advance expenditure
along with FR approval (an essential step)
Land acquisition  At least 12 months is required for land acquisition (priority
area 9 months), it should be taken up before the start of civil
works. Alternative methods of land acquisition need to be

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explored or else delay the Main Plant award.

Construction  Construction management training at entry level and
Management Training subsequent training for all at regular intervals.
 Scope to be re-checked at site in a joint meeting with all
major agencies
 Cordon off the area under excavation, to avoid rain water
entry.
 To speed up the floor concreting, deck sheet to be used
instead of shuttering (at powerhouse intermediate floors,
bunker bay roof etc)
 Review of inspection practices and methodology of OEM’s .
 CW piping –100% RT to be done at site for joints or at least
in front of condenser & GT area.

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Change Management Policy Decisions

1. More Delegation of Power at Project Level,so that decisions not affecting

milestone dates can be taken locally.

2. Accountability should be clearly fixed for each task.

3. Task Priorities clearly communicated upto last working layer.

4. Resolute Management with Lean & Transparent administration at project.

5. A completely separate subsidiary (like NTPC infrastructure) for project

infrastructure development should be created for faster project development like

modern IPP’s.

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Conclusion:
“Project execution is in fact a management culture, a culture that must be embedded
into the project delivering models in order to maximize the management knowledge in
practice, and make project execution faster.”

But this is easier said than done, as most of us know from past painful experience.
Project execution has been an unsolved problem for too long.

Faster project execution requires a high-performing project team, with a high degree of
agility and flexibility which is ready to challenge the conventional management
precepts. Putting a modern twist on execution principles of project execution strategy
will enable you to accomplish faster project execution, with fewer but efficient
resources, and take your organization’s performance to the next level.

In the ongoing global shakeout, victory requires clear objectives, streamlined and
flexible processes, and optimized & decisive application of on-hand resources coupled
with latest technology.

Victory requires not the largest force, but the most effective one, applied at the
critical point, within a narrow window of opportunity. In business, as in battle,
the nimble are consistently able to defeat the large and unwieldy.

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References:
1. [Link]
financial-journal/software-tech... 8/16/2010 Page 1 to 5
2. [Link] Research Reports Articles/Critical Chain Project
Management: doing more projects- faster! by Satyashri Mohanty
3. [Link]
[Link].
4. [Link]-execution-to-accelerate-infrastructure-
[Link]
5. Agilean Project Portfolio Management by Hans Mikkelsen and Jens Ove Riis,
Centre for Industrial Production, Aalborg University, Denmark, Page 3 of Project
Management Practice, IPMA, issue 2, Summer 2008.
6. The Power Sector Challenges by R.V Shahi
7. The Planning Commission website
8. CEA website
9. The Power Ministry website
10. The Knowledge management portal of NTPC.
11. Intranet site of PMC (Project Monitoring Cell)
12. Intranet site of various NTPC projects.
13. Previous HORIZON editions.
14. [Link]
15. “[Link]”

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ANNEXURE 1

Source: Annual Report 2009-2010, Ministry of Statistics & Programme Implementation, GOI

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ANNEXURE 1.1

Source: Annual Report 2009-2010, Ministry of Statistics & Programme Implementation,

GOI.

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ANNEXURE 3

RIL KG D6 Deepwater Gas Development Project

- Transforming India’s Energy Landscape

Here is a case study on RIL to demonstrate its ability to excellently execute Projects:

RIL has started gas production from Dhirubhai 1 and 3 Discoveries of the KG-D6 Block
situated in Bay of Bengal in six and half years, in comparison to the world average of 9-10
years for similar deepwater production facilities. This achievement is especially commendable
as the Bay of Bengal is known for its extremely hostile weather conditions, inundated with
storms, cyclones, waves up to twenty meters in height and sub-sea currents of over 4 knots,
except a fair weather window of four months every year.

Deepwater projects typically face many technical challenges. Some of the critical
activities being : Selection and design of concept, lack of technology know how, vendors
and contractors in India, remote area with zero infrastructure, Processing & Support
transportation and Storage facilities etc .RIL also had to overcome supply chain challenges
and manpower shortages to adhere to tight schedules. Start of production of gas from the KG-
D6 block was a complex task, requiring engineering ingenuity to develop critical infrastructure
and use of latest Cutting edge technology, never experienced in the region before.

The key factors for the successful project execution are as follows:

 Daily / Weekly meetings held with Key Contractors by RIL teams co-located at
engineering consultants / fabrication yards for progress review and
resolution of issues at site level enabling faster decision making.
 Steering Committees formed with Project Sponsors from RIL & Top Management
representatives from various key Contractors for ensuring continued alignment with
Project Objectives

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 War room concept: War room set up initially at Mumbai and then at Onshore
Terminal where all the Project information could be available at a single location
24x7 & readily available to the Senior Management for conducting reviews and
meetings. War room adequately equipped with communication hot lines, Pin-up boards
for displaying Project status charts, Project trends & critical issues. Also regular
schedule analysis done & flagged with “Hold Points” to the Senior Management
where potential delays envisaged

 Multi-tiered inspections carried out to ensure quality conformance to the standards

defined in the quality plan which includes Inspection by DNV, engaged as a third
party verification apart from vendor’s QA/QC personnel and RIL quality
inspectors

 Created dedicated infrastructure such as Construction Jetty, Haul Road,

Widening of approach roads, drilling & well completion workshop, Service
base, Helipad, Pipefabrication shop & workmen colony

 Deployed a large state-of-art installation spread with interchangeability

amongst the vessels

o Adopted highly flexible contracting strategy

o Multiple contracts with interface management and overall integration
through Project team

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ANNEXURE 4

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ANNEXURE 6

Use of Satellite for soil survey

Satellite images obtained in the optical domain can provide information on important soil
properties, such as texture, cohesion, Soil bearing capacity and various soil types. A multistep
methodology based on the use of ground, satellite and ancillary data is proposed and tested to
map soil texture. The methodology uses satellite images to extract relevant spectral
information about the concerned area which are further processed.

Multi-spectral satellite data along with other relevant collateral data on geology,
geomorphology, topography, infrastructure, forest cover, hydrology and meteorology were
used to generate integrated thematic information on GIS platform for selecting sites for
pithead, coal-based Thermal Power Stations (TPSs). Selection of sites for TPSs was based on
four primary criteria, namely land, water, fuel (coal) and environment, and two secondary
criteria, namely resettlement & rehabilitation (R&R) and accessibility to the site. Satellite
imaging helps to generate the Site-Suitability Index (SSI) based on the above criteria to select
the best site for TPSs.

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ANNEXURE 7

4D PLANNING AS A VALUABLE COMMUNICATION TOOL

An advanced visualization technology which includes 3D product model integrated with

schedules of activities (TIME). This technique has tremendous potential to increase the
communication efficiency and interpretation ability of the project team members as
visualization is the process of displaying information which assists in understanding
and evaluating information.

A 4D CAD model (3D CAD model with time as the 4th dimension) allows
construction planners to review and generate better construction plans. A 4D models
compare to traditional 2D (two-dimensional) CAD drawing gives better understanding
of the project.

Research have shown that 4 D modeling is much efficient than 2D drawings in the field
of Time saving. It helps in development of more complete and accurate schedules. It
also helps in terms of identifying missing activities, out of sequence work, invalid
relationships and potential overcrowding issues during the schedule review process for
a construction project.

The benefits of 4D models as a visualizing tool to rehearse the construction plans,

identify construction consequences, space conflicts and improve communication of the
project team members. improving the quality of construction plans and schedules.

Schedule generation is an important part of the construction planning process. The

process of schedule generation is usually modified and carried out several time during
the whole life of a construction project. In order to develop a construction schedule, a
planner has to first interpret what has to be constructed on the basis of available
information (design documents, 2D CAD drawings and 3D model). Planner then
identifies a list of activities required to construct the project. Finally, on the basis of
construction method and based on available resources, the planner creates sequential
relationship among the activities and calculates activity and project duration to
generate schedule. During construction stage, a constructor faces difficulties in
interpreting the information from 2D CAD drawings, because they need to visualize the

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components in their mind and then link the mentally visualized component with the
individual activity represented in Critical Path Method network.

The whole process of interpretation of information from the 2D drawings is a

complicated and difficult process to understand the schedule intent. As a consequence
constructors spend most of their valuable time in the interpretation of information from
2D CAD drawings. 4D planning and scheduling technique that integrates 3D CAD
models with construction activities (time) has proven beneficial over the traditional
tools. In 4D models, project participants can effectively visualize, analyze, and
communicate problems regarding sequential, spatial, and temporal aspects of
construction schedules. As a consequence, more robust schedules can be generated
and hence reduce reworks and improve productivity.

Construction professionals who used the Immersive Virtual Environment (IVE) for
construction plan review and generation were able to reduce their planned schedule by
28%, develop a more detailed understanding of schedule dependencies, identify more
constructability issues (e.g., clearances, weld locations), and improve their overall
schedule confidence. One of the significant benefits noted throughout this research
was the value of the IVE as a tool to foster collaborative planning with improved
communication among the various project planners.

Real Example

Westinghouse Electric Company, United States Cutting Construction Costs:

Eliminating Months from Nuclear Plant's Schedule

The AP600 project team not only verified the schedule through visualization, but it
found another three to five months could be eliminated through logic and design
changes alone. This has a significant positive impact on financing costs.

"Building a nuclear plant is extremely capital intensive," says Ed Cummins,

Westinghouse's director of passive plant development. "Cutting down
construction time greatly reduces investment costs. Not tying up roughly $1
billion for an extra four months adds up to significant improvements in power
plant construction cost. The plant also can begin operating and generating
income sooner, contributing to the economic benefits."

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