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Tuesday, December 11, 2018

Maritime Logistics Professional

WHO SHOULD BE THE DESIGNATED DRIVER?

Posted to BoatbuildConsult.com (by on December 16, 2009

Observations and lessons hard-learned about project management in boatbuilding.

Just about every boatyard uses the expression, “On time and on budget.” But in reality, how many major build or refit projects meet those criteria? Very, very few, if any.

There is a plethora of factors working to prevent a project from coming in on time and on budget.
But in my experience, it is the inter-relation between three specific and key components of a major project that make or break it: 1) design/engineering, 2) materials/labor logistics, and 3) project planning and management.

A truly miniscule number of projects are held from starting until all relevant design and engineering have been completed. Instead pressures, primarily from buyers/owners, but occasionally from yard cash-flow needs, almost always result in major projects being started while design and/or engineering are still underway. And even if preliminary design and engineering for a project have been completed by the time the project gets underway, detailed systems engineering, completion of specifications, and production of shop drawings invariably continue to be done “on the fly” well after the project has begun.
 
Once engineering and related specifications have been finalized, there still remains the task of materials acquisition. Unfortunately, materials procurement involves an inherent time lag due to the need to locate, bid out, and finally purchase for a major project what is often a list of hundreds, if not thousands of items. Some of these may be available off the shelf, but just as many, if not more, have first to be assembled and/or manufactured to order before being shipped. This results in substantial, sometimes unanticipated lead times from order to delivery. And this does not yet take into account the fact that some specified items will often be found to be out of production and unavailable, or carrying too high a price tag, or involving too long a lead time for production to stay on schedule. In such cases, re-entry into the project’s design/engineering spiral is necessary, with all of its attendant additional delays.

The reality in a great number of major build and refit projects is that you have the tail wagging the dog. Too many major projects end up being driven (controlled) by “engineering” and/or the “BOM” (bill of materials). That situation is, I have to tell you, very far from being a happy one. Allowing engineering (i.e., when specifications and/or drawings happen to be available), or the BOM (i.e., which and when materials happen to be available) to control production inevitably leads to a project duration well beyond any initially envisioned. That often leads in turn, at best, to bad feelings and, at worst, to claims for liquidated damages due to late completion.

My experience is that the only acceptable driver for a properly planned and managed project is the production schedule. The production schedule should be dictating when engineering and attendant specifications and drawings are finalized, not the other way around. Similarly, the production schedule should be dictating materials target order and delivery dates, not the other way around.

Of course, achieving the ideal situation, in which the production plan/schedule drives engineering, materials acquisition, and production, requires having not only a highly detailed project plan in the first place, but also one which is grounded in reality. Further, it requires a plan that is practical in the circumstances as to allocation of labor and other resources, and as to the projected durations of component operations. The creation and implementation of such a project plan requires significant hands-on, industry-specific build and refit management experience. There is no way around it. In this, as in most things relating to boat building and refit… experience always matters.

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