Optimizing EPC Project Delivery With 4D Experience
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| 1Copyright 2014 | © E2C Bridge Proprietary Information
Optimizing EPC Project Delivery With “4D” Experience 3DS Conference- EPU Track
Nov 12 2014
Dr Yasser Alkazzaz
Founder & CEO
E2C Bridge
yalkazzaz@e2cbridge.com
+1 817 253 4129
Design Reality
Project Delivery Optimization
| 2Copyright 2014 | © E2C Bridge Proprietary Information
Agenda
• Introduction & Background
• Project Delivery Challenges & Opportunities
• New Approach to Project Delivery Optimization: “4D Experience”
E2C Bridge Solution and Services
Optimized Plant Construction
• Advantage and Benefits
Key Functional Advantage and Improvement
Potential Financial Saving and Benefits
| 3Copyright 2014 | © E2C Bridge Proprietary Information
Project Delivery Is About Mobilizing Capital to Transform
Engineering Design Into Reality Upon A defined Schedule
EngineeringConstruction &
Installation
Design Completion
Budgeting & Scheduling
Work Packages (Materials/Contracts)
Project WBS, BOM
Engineering Documentations
Project Delivery
Procurement & Materials Management
In project delivery any issue, error, delay can directly and simultaneously
impacts cost and schedule performance
| 4Copyright 2014 | © E2C Bridge Proprietary Information
Capital Projects Aren’t Delivered On Time and On Budget
Leading to Hundreds Billions Value leaks Across Industries
• Errors in planning leading to rework account for 15% of cost and up to
40% decrease in construction productivity
• In one single capital project 70% of labor cost is spent on inter and intra-
company interactions leading to decreased overall EPCM productivity
• Poor materials management & delivery could cause
7% increase in materials cost,
16% increase in project delays and
24% decrease in construction productivity
and 75% behind schedule Cycle Time
Cost
63% of projects over budget
ConstructionEngineering
LogisticsFabrication / Expediting Purchasing Requisitions WarehousingQuality Surveillance
| 5Copyright 2014 | © E2C Bridge Proprietary Information
Projects Delivery Does Not Effectively Bridge Engineering
With Construction Leading to Poor Project Performance
Project controls & materials management still suffer from being separated,
suboptimal, lacking power and some time not impartial
Islands of data with “Ad Hoc” integration causing leak and inconsistency and
preventing analysis and evaluation of construction alternative
Lack of portfolio standardization and globalization (project per project basis)
Lack of global portfolio consistency (process, resources, and contractors)
preventing effective knowledge transfer and development
Owner/EPC/EPCM relationship requires improvement in both sides.
Logistics
and 75% behind schedule
Cycle Time
Cost
63% of projects over budget
Fabrication/ Expediting Purchasing Requisitions Warehousing
ConstructionEngineering
Quality Surveillance
| 6Copyright 2014 | © E2C Bridge Proprietary Information
E2C Bridge Integrates Project Planning & Controls With Procurement and
Material Management into Effective Project Delivery Process Framework.
Engineering Construction
Project Delivery Optimization
E2C Bridge
Procurement &
Integrated Materials Management
Process
Framework
On DemandRemote &
Central
Lean
Methodology
4D
Controls
One Stop
Shop
Concurrent
Scheduling
Delivery
Methodology
One Stop Shop Integrated Services
Concurrent versus sequential planning &
scheduling continuously aligning schedule,
cost and materials with construction
Integrated materials management process
from engineering specification all the way to
installation
On demand, central & remote approach
facilitating set up and driving process
consistency & alignment
| 7Copyright 2014 | © E2C Bridge Proprietary Information
E2C Bridge Consulting and Service Capabilities Are Defined to
Drive Optimization & Integration Through The Project Lifecycle
Option selected Baselines Complete.
Definition, PlanningInception, Identification Execution
CONSULTING SERVICES MANAGED SERVICES
Project & Portfolio Strategy
Portfolio Optimization• Design Standardization
• Contracting Framework
Agreement
• Process and IT
• Resource and Knowledge
management
Project Delivery Strategy
IT Systems Strategy
Project Planning
Work packaging
Modularization Study
Project Scheduling
Project Budgeting
Procurement Planning
Logistics Optimization
Sourcing Optimization
Project Controls
Cost & schedule control
Change management
Progress reporting
Performance management
Materials Management
Requisitioning & bidding
Purchasing
Expediting
Vendor quality Surveillance
Logistics
Site receiving
| 8Copyright 2014 | © E2C Bridge Proprietary Information
E2C Bridge Project Delivery Framework Integrates Schedule With
Materials and 3D Design to Offer Highly Effective 4D Controls Approach
Cost Controls
Schedule Actual Dates
Actual Delivery
Dates
CommitmentsBudget
Estimate
Quality
SurveillanceLogistics
Project
Engineering
Data
BOMPackages
RequisitionsPurchasing Expediting
Site
Construction
3D Design
4D Simulation & VisualizationEngineering, Procurement and Construction
Material Elements
Planned Due Dates
Due Dates
Budget Allocation
| 9Copyright 2014 | © E2C Bridge Proprietary Information
IT Still Is Best of Breed Lacking Integration, Alignment And
Key Elements to Address Critical Functional Gaps
Engineering
Data
Management Project Document Management
Materials Procurement & Contracts
Construction & Site Management
Project Planning & Control
Commissioning
Project Data Management
En
g D
esig
n T
oo
ls
Publish
Eng
Information
Project management
Project Portfolio Management Data Analytics, Reporting, Benchmarking & Performance Management
Project Portal Pro
ject P
rocess M
anagem
ent
Contract
Management
Capital
Estimating
EPCM
EstimateCost ControlScheduling
EPCM
Progress
Risk
Mgmt
Quality
Mgmt
Reporting
Dashboard
Safety
Mgmt
Project Admin,
CollaborationResource
Management
Purchasing
Hand Over
Expediting LogisticsSite Materials
ControlsInspection
In House/custom
Missing/Not deployed/AdHoc
Best of breed
Engineering focused
Owner
Operations
| 10Copyright 2014 | © E2C Bridge Proprietary Information
E2C Bridge Has Chosen “Optimized Plant Construction”
To Support Its Approach and Process Framework
2
4
5
3
Construction Field
Planning & ExecutionLean Construction Execution
Engineering Work Package Digital engineering management
from plan, execution, approval to
change
Collaborative Digital ProcurementProductivity for requisitioning & manage
procurement lifecycle
Requirements Driven
Project Management & MonitoringProject management & execution integrated with
Quality Management System
6
Virtual Construction
4D SimulationConstruction plan optimization &
validation
3D Construction Instructions Intuitive work instruction for safety,
quality & efficiency
1
| 11Copyright 2014 | © E2C Bridge Proprietary Information
OPC 4D Approach Facilitates The Application of Lean
Principles And Optimizes Project Controls & Delivery
• Simulation & Validation Proactive Vs Reactive
Redefining project controls from passively monitoring results to proactively influencing
and ensuring predictable project outcomes.
• Integration & Visibility Global Optimization Vs Local Optimization
Redefining performance improvement by maximizing value and minimizing waste at
the project level versus locally optimizing each individual activity.
• 4D Virtual Construction Concurrent Vs Sequential Engineering
Redefining Project Delivery from sequential engineering and construction
to simultaneous design of the facility and its construction process.
• 3D Instructions & Training Pull Vs Push
Coordinating action through pulling and continuous flow of information as opposed to
traditional, central authority driven push
Decentralizing decision making through transparency and empowerment by providing
project participants with information on the state of projects and empowering them to
take action.
| 12Copyright 2014 | © E2C Bridge Proprietary Information
E2C Bridge Estimates Potential Saving From Project
Delivery Optimization to 10% of CAPEX at A Minimum
% of CAPEXHistorical
ratios
% of
EPCM
$1BProject
Potential Saving
EPCM Fees 10% 100% $100M % of Saving Saving
Engineering Design 3% 30% $30M 5% $1.5M
Engineering Detail 5% 50% $50M 20% $10M
Materials &
Procurement
Management
1% 10% $10M 20% $2M
Project Controls 0.3% 3% $3M 20% $0.6M
Project &
Construction
Management
0.7% 7% $7M 20% $1.4M
Equipment 25% N/A $250M 1% $2.5M
Bulk Materials 30% N/A $300M 3% $9M
Construction Labor 35% N/A $350M 24% $86.4M
Total $1000M $113.4M
• Optimizing Project Controls, Procurement & Material Management, which represents only
1.3% of CAPEX can produce significant saving across the entire CAPEX
• Standardization Can Produce Much Larger Across The Project Portfolio
Bonus
Bonus
Bonus
Standardization
| 13Copyright 2014 | © E2C Bridge Proprietary Information
Define/Plan Execute Operate
Also, 4D Approach Could Result in Schedule Compression
Up to 15% And Significant Increase In ROCE
Increase
Decision Quality & SpeedStreamline Execution
Pull in
production date
Increase ROCE
Delays in
production date
postpone and
decrease ROCE
15% Schedule
Compression
Planned Completion
| 14Copyright 2014 | © E2C Bridge Proprietary Information
Our Contacts & Information
Dr Yasser Alkazzaz
Founder E2C Bridge
yalkazzaz@e2cbridge.com
Mobil +1 817 253 4129
About the Presenter
Dr Yasser Alkazzaz is Founder & CEO at E2C Bridge. He has over 26 years of leadership experience in both capital projects & industrial
operations environments. Previously he was global director at Hatch engineering consulting and project implementation and held executive and
management consulting positions in USA and Europe at PWC's PRTM, i2 Technologies and ORTEMS a company he co-founded in Europe on the
basis of his PhD research in the area of manufacturing control planning and scheduling.
Dr Alkazzaz passion is about solving complex industry and business problem by applying innovation in technology and process methodology
including best practice transfer in between industries. He has several contributions in both academic and industry arenas.
Dr Alkazzaz hold a PhD in Industrial control applied to manufacturing planning and scheduling and two masters of industrial engineering
and automatic control
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