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Oil & Gas

NEEDS-BASED RESULTS

 

Oil & Gas

SITUATION

An oilfield services company was experiencing significant capital project cost overruns and schedule slippage due to project management deficiencies and resource constraints.

DRIVER GOAL

Deliver $38 million capital project on time and on budget, including construction of a new facility in Mexico.

RESULT

  • We developed and deployed an effective PMO function.
  • Current critical path analysis forecasts an on-time delivery.
  • The project has recovered from multi-million dollar cost overruns.

Case Study

Capital Project Management for a Multinational Oilfield Service Company

Issue

A multinational oilfield services company had initiated a $38 million capital project encompassing construction of a new manufacturing facility in Mexico, closure of two facilities in California, relocation of existing equipment as well as the purchase and installation of new equipment. The company was experiencing significant projected cost overruns and schedule slippage due to project management deficiencies and resource constraints.

Highland Approach

The Highland Group analyzed the existing project management system to understand the cause of delays, redundancies and budget overruns. We also executed a comprehensive organizational effectiveness analysis, which identified the optimum project management structure as well as critical experience gaps. Armed with those insights, we defined the project structure and implemented critical path management. We then designed a structured project management office (PMO) to increase project performance visibility and enable management to control overall execution. The Highland Group personnel are directly supporting the project through completion.

Actions Taken

Designed and implemented a System For Managing with tools to manage the work, remove barriers and improve performance. Specific components include:

  • Pre-initiation design/project reviews
  • Client/contractor communication plans
  • Daily, weekly and monthly schedules
  • Daily project controls
  • Daily and weekly reviews
  • Short-interval management tools
  • Barrier identification and removal
  • Schedule attainment and tracking
  • Modularized training for future projects

Delivering

$38M

capital project on time and on budget

Analysis of cost s-curve indicates that the project has recovered from multi-million dollar cost overruns.

Related Information

industry-based

Project Leader

Oil & Gas

North America

Tom is a senior project leader with over 25 years of international management consulting experience in the oil and gas, utilities, manufacturing, financial services, telecommunications, media and aerospace industries. He has served Fortune 500 and Global 2000 companies in 15 countries across North America, EMEA and Asia.

Project Leader

Manufacturing & Industrial

Joseph is a senior executive with more than 40 years of international industry management and consulting experience, primarily in the areas of process improvement, working capital optimization and operational metrics. Having served in more than 21 countries around Latin America, the Caribbean, the Pacific Rim, and North America, Joseph is skilled at implementing successful and sustainable change programs in culturally diverse environments.

Presenting Analyst

John is a Senior Executive and Presenting Analyst at The Highland Group with more than 30 years of leadership experience in management consulting. He has led hundreds of global consulting engagements that delivered an array of operational improvement solutions with total client benefits exceeding $1 billion dollars.