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Case StudyCost Reduction & Performance

Improvement Aiken Group Case Study

Gareth James (IT Manager)


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Agenda

Introduction to Aiken Group

Pains / Problems faced by Aiken Group

Solution outline what was used toaddress the pains / problems

Reasons to select the specific solution

How is HD Job Costing being used Benefits gained from using solution


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Who are we

Aiken Group is a leading provider of construction,engineering, maintenance and project management serviceswithin the Oil and Gas Industries. Aiken Group recognizedthat investing in a fully integrated Project Cost Managementsystem would strengthen their competitive advantage to

respond and report to customers. This case study will explainhow HD Cost Management and Primavera were implementedand used by Aiken Group to provide dynamic data integrationand project cost controls throughout its worldwide operationsresulting in - improved accuracy and response time tocustomer pricing queries ,improved performance &

profitability, real time estimation & scheduling integration toaccurately model cash flow and Earned Value Reporting, realtime production control and productivity reporting, greaterproject portfolio visibility and reporting to project and seniormanagement regionally & globally.


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Over the past 22 years the Aiken Group has evolved tobecome an international engineering and specialist group.

Aiken Groups premises occupy 10,000ft2 of office space

and 30,000ft2 of warehouse facilities.

Yard storage at Marywell Training facility

Aiken Group


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OFFSHORE

SURVEYS

CONCEPTUALSTUDIES

DETAILED

DESIGN/

FEEDSTUDIES

3DDE

SIGNS

ENGINEERING

PROCUR

EMENT

CONSTR

UCTION

ARCHITE

CTURAL

UPGR

ADES

PRECOMM

ISSIONING

&COMMISSIONING

HAND-O

VERTO

OPERA

TIONS

MAINTE

NANCE

FACILITIES

MANAG

EMENT


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Divisions


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Aiken GroupArchitectural Services

Aiken Group can provide the full range of services required for the successfuldesign and realisation of new builds, upgrades, modifications and the

refurbishment of living quarters and associated facilities.

Service provision covers:

Offshore Surveys Conceptual studies

FEED (Front-End Engineering Design) studies

Detailed design

3D graphics

Engineering, procurement and construction

Project management

Construction support engineering and labour


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Situation

As we started to grow Aiken Group determinedthat it needed to change the way that it handledmany aspects of its business, especially in thearea of project management. The processes used

at Aiken Group varied widely, based on thepreferences and habits of the individuals whoworked in individual departments. We wanted toestablish consistent processes across theorganisation so that our clients could experience

the same service and success regardless of wherethe consultants and groups they worked with werelocated,


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Pains / Problems faced byAiken Group

Costs associated with quoting

Our architectural department had recently quoted for 6 new similar

jobs over a 2 month period and we calculated that the average cost for

each of these quotes was 80K per quote

Time and resources used by quoting process Our engineers were having to work overtime just keep up with the

number quotes going out

Multiple sources of information

Each quote or actual job had multiple MS Excel spreadsheets usuallysplit over different engineering disciplines, with each discipline using

different methodologies and different spreadsheets


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Both Primavera and MS Project

Because of our place in the supply chain our client usually dictates

which Project Planning tool we use, this makes portfolio management

difficult across different jobs.

No Knowledge capture We where unable to reuse prior quotes or jobs easily, with information

being hidden away inside a spreadsheet somewhere

Inconsistent quoting methods

Different departments use different Project ManagementMethodologies, we needed something that could cope with this.


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Difficult to analyse profitability across divisions / no portfolio

analysis

We were relying on our accounts information to let us know what was

happening with our projects and this was coming in after the fact.

Unable to track hidden costs

With large amounts of costs being put to general overhead it was

impossible to look at the direct costs associated with a job.

Poor Project Planning and Management

Frequently Project plans werent even being create unless a clientasked for one, the justification being used its only a small job we

dont need to


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Selection Criteria

Proven Solution

ROI

Flexibility to integrate into how we work

Work within multiple methodologies

Work with both Primavera and MS Project

Software Architecture

User Interface

Planning integration Closed Loop

Scalability

Deployment / Support


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Solutions

Benchmarked against our competitors

Reviewed marketplace

Developed our own systems

Reviewed marketplace again

HD Cost Management


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Implementation

Installation Remotely installed on our already virtualised server

infrastructure

Training An implementation team was selected and in-depth training

given from both HD and Milestone. Training is now being givento each department aligned with roll out plan also now utilisingour new training facility.

Integration With all backend systems, Primavera, MS Project Server,

SharePoint, Accounts

Rollout status Now all our major departments have started using HD Job

Costing. All new quotes are being carried out in HD Job costing,we are now running 2 large jobs using HD Job Costing

ll
http://www.icmedialtd.com/downloads/IC%20CORPORATE%20BROCHURE%20Q4%202009.pdf


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Training roll-out via IC Training
http://www.icmedialtd.com/downloads/IC%20CORPORATE%20BROCHURE%20Q4%202009.pdfhttps://ictraining.accessplanit.com/accessplan/default2.aspxhttp://www.icmedialtd.com/http://www.icmedialtd.com/downloads/IC%20CORPORATE%20BROCHURE%20Q4%202009.pdf


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Project Lifecycle


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User Interface


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Price Breakdown Structure


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Target Price

Target Profit

Bid Costs

Direct Cost Markup

Indirect Cost Markup

Direct Costs

Indirect Costs

PBS

The purpose of the PriceBreakdown Structure

(PBS) is to analyze and

finalize your Target Price

by adding profit.

Job Overhead

Business Overhead The Target Price is asummary of Bid Costs

and Target Profit on

which the Proposed

Price can be based.

Bid Costs are a

summary of

Direct and

Indirect Cost.

Cost Items with no Pay Item

Assignment. They represent overhead

costs that are not directly related to the

completion of a Pay Item.

Target Profit is a summary of

Direct and Indirect Cost

Markup on which the

Proposed Profit can be based.

Costs that have a direct relationship

to the completion of Pay Items.

Cost Items with a Pay Item

Assignment are considered Direct

Cost.

Price BreakdownStructure


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Cost Breakdown Structure


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Benefits

Aiken Group has found that its new technologysolutions help it achieve its goals of increased

productivity, improved client service, and decreased

costs. Change takes time, but our efforts are already

making people better at their individual jobs, saysDanny Donald Aiken Group MD. Were using HD Job

Costing to give people information, achieve greater

accountability, and positively change employee

behaviour over time, all of which improve our ability

to serve our clients.


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Documents

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