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Project:Reid Highway Extension, Perth, Australia

Trusted by the world’s largest projects

Project Collaboration onInfrastructure Megaprojects

With

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AgendaIntroduction Santiago Castagnino, Boston Consulting Group

Industry Success Mary-Lou Lane, Parsons

Aconex Demo Hannah Hosch, Aconex

Q&A

Image: Courtesy of Gensler. Certain other images provided by Aconex clients.

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Market and execution challenges are increasing

Market(top-line impact)

Operations(bottom-line impact)

Trends inconstruction

Bigger, more complex projects• Technical complexity increased• Funds available to fight infrastructural

bottlenecks (not only in emerging markets)

More complex client structure & risk profile• Riskier public and PPP1 projects require

enhanced risk management• Desire for collaborative approaches and

risk-sharing

More challenging and green projects• Supply chain control fundamental

in international project settings• Demand for energy efficiency and

sustainable construction

Pressure on operational costs• Productivity still main lever to

increase (international) cost competitiveness

• Installation of lean mindset seen as an opportunity lever

War for talents and collaboration needs• Engineering demand has exceeded

available talent for many years• Supplier integration increasingly

important

Projects often out-of-budget• Time: Low adherence to

schedules• Quality: Often rework needed• Costs: Transparency essential

1. Public Private Partnership

Source: BCG analysis. Pictures partly from web

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Construction industry: Clear need for actionWide gap in productivity improvement in manufacturing vs construction in the last decades

253

89

0

100

200

300

20051995 20101990 2000 201519851980197519701965

Labor productivity index1

Construction

Manufacturing

2.8x

1. P. Teichholz, "Labor-Productivity Declines in the Construction Industry: Causes and Remedies (Another Look)", AECbytes Viewpoint #67, March 14, 2013

1/3 automation2/3 lean approach

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On average > 50% of activities are non-value adding activities

On-site processesOn-site processes

Products Organization

Stocks

Space

Movement

Rework

Waiting

Transport

Waste on construction sites1

0

20

40

60

80

100

%100.043.5

16.3

12.9

7.06.7

6.03.3

1.41.30.90.60.1

Mov

ing

of m

ater

ials

of o

ther

con

trac

tors

Def

ect-

rela

ted

inte

rrup

tions

Cor

rect

ion

of d

efec

ts

Oth

er

Mat

eria

l cos

ts

Per

sonn

el-r

elat

edin

terr

uptio

ns

Tra

nspo

rt o

fw

ork

equi

pmen

t

Wai

ting

Cle

anup

AV

/alig

nmen

tan

d co

ordi

natio

n

Tra

nspo

rt o

fm

ater

ials

Val

ue-a

ddin

g ac

tiviti

es

Tota

l

Waste: 56.5%

1. Scope: time series study, n = 29

?

Waste should be identified in …Waste should be identified in … Proportion of waste in processesProportion of waste in processes

1 2 3

4 5 6

Schedule Deviations

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Increased system takt

Significant improvements possible with Lean Total cost of ownership (TCO) with 12–30% savings potential

100

90

80

0

100

TCO savingsService business

TCO Standardization and

modularization

Construction site

management

Total EPC savings

Procurement excellence

Process-based end-to-

end management

Savings in %of total cost1

5–15%

2–3%2–4%

1–3%2–5%

10–25% 12–30%

6–8% 4–7%10–20%

Time savings in % oftotal project duration2

1. Calculation of savings based on the following cost shares: 10–15% planning, 50–60% offer processing incl. purchasing, 25–40% project execution2. Construction phase corresponds to 50% time shareNote: Excluding levers "acquisition," "risk management," and "Lean organization and enablement," since they are not connected with direct savings; prerequisitesSource: VDMA study on construction site management 2009; BCG project experience

Optimized service

Economies of scale

Efficient processes Product

optimization

Reduced rework

20–35%Learning effectsIncreased efficiency

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Example: Lean approach resulted in a reduction of ~20% in labor costs and ~40% in heavy machinery costs in civil construction

Target

Main lever

Impact

Illustration

Problem

Reduction of construction time

Takt planning , incl. capacity harmonization

• Training of workforce• Newly designed process installed, including

harmonized supply capacities• Overall required capacities reduced and

performance improved

Congestion at supply points (up to 50% loss of time)

Road construction Road construction

Before After ChangeInstallation perform. 182 t/h 302 t/h +66%

Æ wait / supply truck 2.2 Min. 0.3 Min. -86%

Æ install. time / truck 6.8 Min. 5.1 Min. -25%

Productivity m³/FTE'h 22,7 38.0 +67%

Æ Throughput time FTE/1,000 t

5.5 h 3.3 h -33%

Throughput time per section (days)

12.2 7.3 -40%

Civil construction (pipes)Civil construction (pipes)

Stabilizing construction and performance controlling

Takt and productivity mgnt. (also: JIT, zero-defect)

• Overall value stream analyzed• Crew work sequenced• Waste and productivity analyses of crews and

machines enabled waste elimination

Construction site > 6km with dispersed crew work

Before After Change

Throughput time (weeks)

4 1 -75%

Productivity (m³/FTE'h)

0.61 0.78 +28%

Costs employees (€/month)

24,000 19,712 -18%

Costs for heavy machines (€/months)

31,500 18,000 -43%

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Lean execution is part of BCG's Excellence in Construction framework

Excellence in Construction

Transparency &risk management

• Align on objectives with client

• Identify risks• Define risk

managementplan

Transparency &risk management

• Align on objectives with client

• Identify risks• Define risk

managementplan

Organization & accountability• Involve stakeholders early on• Define clear accountabilities• Set formal contract manager role

Organization & accountability• Involve stakeholders early on• Define clear accountabilities• Set formal contract manager role

Rigorous planning• Involve relevant

stakeholders• Plan in detail• Update plan

continuously

Rigorous planning• Involve relevant

stakeholders• Plan in detail• Update plan

continuously

Open communication & interface management

• Visual management (cost/cash, lead time, requirements, risks)

• Lean steering

Open communication & interface management

• Visual management (cost/cash, lead time, requirements, risks)

• Lean steering

Strict monitoring• Follow KPIs on site• Define quality gates• Manage changes

proactively

Strict monitoring• Follow KPIs on site• Define quality gates• Manage changes

proactively

Learning & continuous improvement (CI)

• Embed CI in projects• Systematize learning

for future projects

Learning & continuous improvement (CI)

• Embed CI in projects• Systematize learning

for future projects

Lean execution• Define value flow• Align teams

around takt• Set pull approach

Lean execution• Define value flow• Align teams

around takt• Set pull approach

1

2

3

4

5

6

7

Source: BCG

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We train teams on site with our Lean Simulation Tools

Example 1: Hotel construction simulationExample 1: Hotel construction simulation

Application of Lean principles to the construction phase of a hotel• Value creation flow of activities• Task planning• Pull principles• Zero defects• Lean project steering and visualization

Example 2: O&G EPC simulationExample 2: O&G EPC simulation

Application of Lean principles to key phases of an EPC project• Project management and planning• Bidding/Tendering• Engineering• Procurement• Construction

Installation procedures

Lifting equipment mobilized to

installation site

Pile Welding superintendent

Pile hammering Superintendent

Game admin software

Tug boats for material

transport

Real-time update of project P&L

QAQC inspector

Source: BCG

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Mary-Lou LaneDocument Control ManagerOver 7 years in Document Control

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Infrastructure Projects CanPresent Particular Challenges

• Geographically dispersed teams• Large number of companies on the project team• Large project team • JVs/PPPs• Scope change• Regulatory requirements• Public reporting requirements• Stringent handover requirements• Planning for life of asset operations

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Project Challenge Example: Document Accessibility

• Impact: Lost time and increased project costs

• Situations: - Power project in California

- Specific drawing was needed

- Work was held up for 2 days until the document controller came to work the following Monday morning.

- Oil and gas project in Canada

- Lack of a response to an RFI was holding the project up

- The response was sent via email and not received

• Current project: Entire project team is on Aconex,

Team members can directly access documents, drawings and communication and there is a clear record of everything.

13

Project Challenge Example: Transmittal Management

• Impact: Lost time and increased errors

• Situations: - Gas project in Canada- Multiple revisions to a transmittal - Each time, the transmittal had to be started

over- Wasted time of sender and delay of the

transmittal

- Rail project in Colorado- Transmittals went through document control- There was a bottle neck and increased errors

and communication went through document control

• Current project: Project managers and engineers send and revise their own transmittals through Aconex.

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Process and Information Management Best Practices

Select system and define project-wide processes

up front

Define method of cross organization coordination

Ensure full project team has required access and

support

Support of seamless handover through

operations

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Overcoming ChallengesChallenge Manual process System process

Information exchange Email, FTP, error prone Secure, auditable central system

File size and compatibility issues

Inability to email or open files

No file size limits and integrated viewer

Time spent searching for and tracking documents

Email, internal drives, paper archives

Full version history and all communication tracked within a central system

Security Email is not secure and files can be forwarded

All communication happens within a secure environment

Transmitting documents Manual sending of multiple versions to multiple parties

Everything needed is in one central location available from anyplace anytime

Dispute over incorrect/ undelivered documents

Searching through sent boxes and transmittal logs

Clear audit trail with accountability

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Selecting an Information Management System

Flexibility• Should support YOUR project processes• Manage documents, communication and

models• Support PC, mobile and offline access

Project-Wide • Support ALL users from all organizations

equally• Not behind anyone’s fire wall• Secure workspace for each company

Ease of set up and use• Must reflect industry-specific processes• Facilitate cross-project implementation

and adoption

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Results

• Reduced project risk – clear audit trail

• Improved communication – ease of reviews

• Time savings – no tracking, searching or waiting

• A safe, well-documented operating asset – built as designed

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Aconex collaboration Save money, increase productivity. Manage project risk.

Cloud & Mobile

Information & Process

Management

Engineering & Construction

Project-Wide

Across the Project Lifecycle

Plan Design Construct OperateBid

OperatorSub-contractorsContractorConsultantsOwner EPC Designer

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One integrated collaboration platform for project information and process

Owner

EPC Designer

Consultants

Contractor Subcontractors

Client Service & Support

Web Mobile APIs

Information & Process Management

Platform

Document Management

3D Modeling Field Inspections

Correspondence Registers Bidding & Tenders

Workflows O&M / Deliverables Site Mobility

Network Integration API Reporting & Search

Infrastructure 2D & 3D Viewer Archiving

Operator

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The world’s most widely-used collaboration platform for engineering & construction

500thousandusers worldwide

$800billionin projects

1.1billiondocuments

48thousand

companies served

70countriesaround the world

40offices

globally

RTD Chiyodo BG Group

Tanker Pacific Leighton Welspun Bilfinger

Denver RTD FasTracks $5B

Dubai Metro $7.8B

State Route 99 $1.4B

Panama Canal Expansion $3.2B

Dubai Airport Concourse 3 $4.5B

Algeria Highway $5B

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Aconex: Key Process ExamplesThis was a 20-minute platform demo in the live webinarTo request a personal demo: aconex.com/Demo

• Overview• Mail• RFIs• Submittals• Handover

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Project:Reid Highway Extension, Perth, Australia

Trusted by the world’s largest projects

With thanks to our participants from&

Contact us at aconex.com/Demo