DISTRIBUTION A Division of Power

TRANSMISSION & DISTRIBUTION A Division of Power COST ENGINEERING & PROJECT CONTROLS Pappur Shankar P.Eng Engineers as Managers Conference - Mississa...
Author: Lauren Allison
0 downloads 1 Views 2MB Size
TRANSMISSION & DISTRIBUTION A Division of Power

COST ENGINEERING & PROJECT CONTROLS Pappur Shankar P.Eng

Engineers as Managers Conference - Mississauga Chapter, May 3rd, 2014

2

AGENDA

1 What is Cost Engineering ? 2 A Cost Engineer’s Role 3 A Cost Engineer’s Role During Front End Engineering 4 Conclusion

3

What is Cost Engineering? Are you familiar with these ?

4

What is Cost Engineering ? An influential factor for making business decisions Cost is a major business driver Helps organizations with decision-making and cost management

Makes the difference between success and failure Lack of understanding on cost estimating, cost management and cost control

Is a necessity for survival and not a ‘nice to do’ Cost reduction cost control are essential for survival

5

What is Cost Engineering ? A systematic approach to managing cost throughout the life-cycle of any enterprise, program, facility, project, product, or service. Accomplished through the application of Cost engineering and cost management principles Proven methodologies The latest technology in support of the management process

6

What is Cost Engineering ? Cost engineers use specialized cost estimating, planning and scheduling techniques to help project managers and engineers understand the financial aspects of certain tasks Cost engineering plays an important role in the strategic development of a company Companies utilizing efficient cost engineering techniques can strategically plan a basis model for completing projects

7

Where Cost Engineering is applied ? OIL & GAS

NUCLEAR ENERGY

MINING

TRANSMISSION & DISTRIBUTION

NON CONVENTIONAL ENERGY

TRANSPORTATION & INFRASTRUCTURE

….. IN EVERY SECTOR

8

Project Life Cycle Example of a Capital Project Live-Cycle Project Screening

Initiation

FEED Phase

EPC Phase

Project Screening Financial feasibility study Investment Decision Making

Initiation Project team formation Project charter Summary level schedules, Class 5 estimates

Project Close Out

9

Project Life Cycle Project Screening

Initiation

FEED Phase

EPC Phase

Project Close Out

FEED (Front-End Engineering & Design) Phase Engineering done prior to requesting the authorization to start Estimates and plans Develop detailed execution planning

EPC Phase Detailed Design Procurement Building of the physical asset

10

Front End Cost Engineering During front-end engineering, conceptual estimates for decision making and use of capital information about project options. Cost Engineer is involved in: Profitability analysis Decision analysis Siting studies Cost Containment Capital Cost Bench Marking Value engineering Cost Estimates

11

Process for Front End Planning Process Flow Diagrams

Plot Plans

P & ID IFD

Class 2 Estimate

Equipment List

Class III Estimate

P & ID

HAZOP Reviews

Cost Engineer plays vital role in estimate, schedule on back yard conditions Cost and schedule generated is subjected reviews for effective cost savings

12

Estimate Preparation

13

Class

Class

Definition (%)

Definition (%)

Typical Purpose of Estimate

Typical Purpose of Estimate

Accuracy Accuracy Range (%) (%) Range

Class 5 Class 4 Class 3 Class 2 Class 1

0 to 2 1 to 5 10 to 40 30 to 70 50 to 100

Concept Screening -50 to +100 Study or Feasibility -30 to +50 Budget, Authorization, or Control -20 to +30 Control or Bid/Tender -15 to +20 Check Estimate or Bid/Tender -10 to +15

-50 to +100 -30 to +50 -20 to +30 -15 to +20 -10 to +15

14

What is required for Cost Engineer ? Conceptual Thinking The cost engineer should develop adequate, accurate, conceptual estimates Avoid getting buried in details

Objectivity Maintain objectivity and independence and use judgment and experience to separate value-adding scope from basic scope

Assertiveness Must assertively penetrate the scope and the reason it is included

15

What is required for Cost Engineer ? Leadership Must lead the process and gain the commitment and alignment of the team

Thoroughness Must be thorough to consider key issues, risks

16

Good Traits for Cost Engineers Organizational skills Communication and facilitation skills Articulate Extensive field experience (value engineering and constructability) Strong analytical skills Good perceptual and interpretive skills (bridging client needs to design decisions) Credible evaluative skills Experience based risk management skills Strong presentation skills

17

Summary Involved in almost all you see, touch and rely upon

Can be an exciting career full of opportunities

Job market is generally good

Pay and benefits are among the top for the level of the company

Opportunities for leadership, global travel, and benefiting humankind abound

Many doors open to other exciting careers isuch as CEO, business administration

18

WE CARE embodies SNC-Lavalin’s key corporate values and beliefs. It is the cornerstone of everything we do as a company. Health and safety, employees, the environment, communities and quality: these values all influence the decisions we make every day. And importantly, they guide us in how we serve our clients and therefore affect how we are perceived by our external partners. WE CARE is integral to the way we perform on a daily basis. It is both a responsibility and a source of satisfaction and pride by providing such important standards to all we do.

WE CARE about the health and safety of our employees, of those who work under our care, and of the people our projects serve.

WE CARE about our employees, their personal growth, career development and general well-being.

WE CARE about the communities where we live and work and their sustainable development, and we commit to fulfilling our responsibilities as a global citizen.

WE CARE about the environment and about conducting our business in an environmentally responsible manner.

WE CARE about the quality of our work.