Procurement of Complex Tunneling Projects

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  • Procuring Complex Tunnelling Projects Considerations for Owners and Contractors

    Steve TennantDirector Plus 3 Consultants

    www.plus3.com.my

  • What Am I going to Cover?

    1. Updates in Project Management Theory2. Practicalities3. Business Cases and Honesty / Optimism4. Unmanageability and Uncertainty

  • Project ManagementTechnical

    Traditional Project ManagementSchedule Cost

  • Project ManagementTechnical

    Complex Project ManagementSchedule Cost

    Context Financing

  • Rethinking Project Management

    1. Accounting for external factors instead of treating them as risks

    2. Changing management from a linear process to an interactive process

    3. Emphasizing project completion in terms of creating value, instead of focusing on end product

    4. Thinking of the project on a broad spectrum with multiple purposes and no preset definition in lieu of a defined start and end point with guidelines

    5. Focusing on the training of managers to rely on experience and intuition instead of merely following detailed proceduresRef. Rethinking Project Management (Winter and Smith 2006).

  • Rethinking Project Management Some

    References http://goo.gl/0VSFhg

    International Centre for Complex Project Management http://goo.gl/eS90qE

    Rethinking Project Management - Final Report http://goo.gl/jxY57E

    Transportation Research Board of the National Academies http://goo.gl/hhX3Ws

    New Paradigms for Complex Projects http://goo.gl/0eGcyo

    Management and control of Cost and Risk for Tunneling and Infrastructure Projects

    http://goo.gl/wsAoOU Manageability of Complex Construction Engineering Projects: Dealing with

    Uncertainty

  • Enough of Theories, what about Practicalities?

    The Project Owner whether Government or Private Sector, needs: Credibility

    Enabling Legislation / Concession Financial Technical Project Management capability Acceptable Commercial reputation

  • Enough of Theories, what about Practicalities?

    The Project whether Government or Private Sector, needs: A Business Case

    Business Drivers or Need Scope of Project Financial Metrics Assumptions Cash Flow Statement (NPV) Costs Benefits (Social / Financial) Risk Strategic Options

    Opportunity Costs Review & Approval Points

    Adaptable Business Orientated Comprehensive Understandable Measurable Transparent Accountabilities

  • Honesty in Preparing Business Cases?

    The possibility of Bias? Political Ambitions (Civil Service / Politicians)

    International Prestige Domestic Prestige Personal Benefit

    Commercial Ambitions (Private Sector / Consultants) International Prestige Domestic Prestige Personal Benefit

  • So we have a Project Owner and a Business Case

    1. Getting this far will have been a Project in its own right!2. Unmanageability and uncertainty!

    1. Why increasing knowledge does not exclude unmanageability2. Natural optimism results in failure to include sufficient buffers

    for uncertainty3. The Uncertainty Gap

  • So we have a Project Owner and a Business Case

    Source: South China Morning Post

  • Project Complexity

    Project ComplexityUnpredictability

  • So we have a Project Owner and a Business Case

    1. Getting this far will have been a Project in its own right!2. Unmanageability and uncertainty!

    1. Why increasing knowledge does not exclude unmanageability2. Natural optimism results in failure to include sufficient buffers

    for uncertainty3. The Uncertainty Gap