Project Partnerships and Portfolio Management (3PM) for Signalling Projects

Foreword

Everyone who is in Project Management will probably admit that some projects that you inherit are very challenging, especially the “hand me downs” that have had several Project Managers before it gets to you. you probably encounter the same issues, either you can’t secure the resources or a budget overspend, that may not be covered in the contract or the scope. Incidentally, the client will eventually forgive you for the two aforementioned project management principles (Project Management Triangle) but if you get the final piece of principle jigsaw wrong “Quality”, you will not be forgiven. I am always looking for something to spice up a project when the initial romance has gone stale. I had a lot of issues with the client side, the client had lost confidence in the project team and the team needed a morale boost. Project Partnerships and Portfolio Management seem like a good idea to re-focus the team and get the Stakeholders back on a unified front, whilst creating efficient ways of manging complex projects.

1. Background: Aims

The aim of this research paper is to undertake research pertaining to Project Partnerships and Project Portfolio Management, relative to managing signalling projects. The planned research will be implemented using the survey method from the data generated by Signalling project engineers or delegate. This will be supported by a small case study of the existing project engineering process.  The second part of the research consists of a comparative study of the survey data and the project partnership and packaging philosophy, as an approach to solve the secret of successfully managing multiple signalling projects.

2. Case Study: Signalling Project Engineering process

From experience we recognise that there are barriers that prevent us from successfully completing signalling projects. Taking the Top 10 from discussions in the workplace: –

1. Demand – Too many Signalling projects  
2. Specialist Resource (industry wide) – Not enough Engineers (Signalling Project Engineers) to manage all of the signalling demands.
3. Documentation and compliance requirements – Signalling Standards, Safety, Environmental and quality requirements.
4. Bureaucracy – too many clients, priority changes, long winded processes.
5. Limited access to signalling infrastructure (peak periods, the need for track possessions).
6. Contractual and Procurement constraints
7. Initial funding approval process and subsequent variations
8. Long lead materials
9. Management of change
10. Signalling Design 

2.1 Case Study Findings

Signalling Works Division, has approximately 30 Engineers, all at different levels of experience and ability. Common to all of these engineers is the requirements of the Project Management procedure for the delivery of their nominated signalling projects.

This section covers a case study of the Signalling Works Division and the processes in which the Project Engineer has to comply.

A Signalling Project Engineer is required to comply with generic responsibilities [in particular those identified and be compliant with the various systems and procedures: –

• Project and Construction Management
• Safety Management System
• Environmental Management System (EMS)
• Procurement System
• Business Management System (BMS) 
• Project Management Methodology (PMM)
• Database for Policies, procedures and Instructions

A centralized integrated system for Policies, Procedures and Instructions (PPIs) used to deliver work, is located on an Intranet. These PPIs together with Safety, Environmental & Quality documentation and project specific procedures released by the Program Manager are to be used to ensure works are delivered consistently and methodically to the Client.

The PMM defines the standard method for delivering projects and is available on the Intranet. In order to access relevant copies of Safety, Environmental and Quality documentation.

A Project engineer must be very good at balancing and planning the signalling projects, particular within Rail as there is a lot of paper work and requirements before any work can start.

The list below is rough idea of the areas of a signalling project in which a project engineer has to put in place before any work can be started (on site): –

• Financial and Budget
• Sponsor instructions
• Scoping
• Regional Requirements
• Interfaces
• Resources & Materials
• Possessions
• Safety Management System
• Environmental Management System
• Human Resources
• Risk and Hazard Analysis
• Quality Management
• Project Management Requirements
• Standards and Company Instructions

Key aspects worth noting of all the Project Models are (RailCorp, 2010):

1. Project Engineers if assigned the role of Construction Manager are fully responsible for the management and direction of all work on-site.

2. All staff on-site report to the Project Engineer. They are in effect ‘seconded’ for the duration of their stay on-site as defined by agreed rosters.

3. The Project Engineer is responsible for achieving the scope against targets; no other group is responsible. The Project Engineer (who is allocated either full-time or part-time to a project) reports to the Program Manager of the project.

4. Competent engineers, supervisors and experienced teams are individually accountable to the Project Engineer for achieving targets.

5. The Team Managers are responsible for the competency of those individuals provided. Any deficiency in competency of staff should be immediately notified to the respective Team Manager. Deficiencies in the quality of staff, material or plant should be immediately notified to the respective resource representative for rectification. The Team Manager is accountable to the Project Engineer for the provision of suitably competent staff.

6. The respective Program Manager will assess the performance of each Project Engineer. The Project Engineer directly reports to the nominated Program Manager.

7. All staff work for RailCorp. Individuals are assigned to projects in accordance with resource requests from Project Engineers. All individuals are attached to a nominated Team Manager.

8. Only Project Engineers are accountable for the work performed on each project. There are no ‘functional’ groups responsible for individual functions in the delivery of the project. However, individuals assigned to the project do have specific responsibilities to the Project Engineer.

9. Project Engineers are responsible for collecting as built data and preparing all discipline specific Work as Executed documentation including the updating of live documents such as DSS plans. The validity of the Work as Executed information provided must be attested to by the Project Engineer carrying out a particular component of a project. Where a project is made up of a number of components the Project Manager must compile all Work as Executed documentation provided by relevant Project Engineers and attest to its validity.

2.2 Project support

It is important to note that the engineer has available support resource to utilise within RailCorp for project demands, for instance; safety, environment and procurement to name a few. However, this support is provided as an advisory body and does not necessarily produce any of the documentation, which has to be completed by the project engineer.

2.3 Analysis of Procedures

RailCorp’s Project Engineering procedure is based on the company RailCorp Project Management Methodology (RPMM), which is a development of the Association of Project Management “book of Knowledge”. The bullet points shown below express the amount of requirements/involvement a Project Engineer is required to deliver on a signaling project as part of their duties (this list is not exhaustive): –

• Management of budget and monitoring, forecasting, estimating, cashflows
• Scheduling, resource planning
• Project Admin – setting up files and start up meetings.
• Materials, procurement and involvement in ARIBA (RailCorp’s procurement system)
• Scope of Works – authorised by the regional signaling engineer
• Risk Management requirements
• Project safety Agreement, which defines the changes to the infrastructure and impact on safety.
• Involvement in Concept or design and development stages.
• DSS and underground services requirements
• Project Reporting
• Labour costing
• Quality Control and documentation
• Monthly Financial Responsibilities – Commitments, Accruals, forecasts.
• Monthly KPI Responsibilities – Safety Observations, Quality checks
• Construction Resource requests
• Change Assessment and Change Management
• Roles and responsibility matrix
• Safety Management – SMS, Site Safety plans, any other applicable plan/doc.
• Project Plans – Interface Management, Risk, Environmental, Project Management
• RailCorp – necessary training courses and meetings.
• Possession Management and requirements – work request, Permits
• Production of Work Packages – Installation, Testing and Commissioning.
• Certification and Handover requirements
• Audit requirements
• Lessons learnt
• Project closeout & archiving

3. Survey of Engineers opinions

A survey of Engineers experience was carried out by completing multiple choice questions on a survey website (Survey Monkey), this involved sending engineers a link to the website with instructions on entering the data. Two of the questions were open ended for the Engineer to add their own comments.

The survey was undertaken over a 3-week duration, where 15 Project Engineers (or representatives) were chosen to conduct an online survey. The questions from the survey were generated using advice from Line Managers, Engineers and the author’s Mentor. The first part of the survey attempts to find out what kind of signalling projects are being managed within the infrastructure Renewals. The second part of the survey has been devised to provide a sample of what Engineers may find difficult about the existing Project Engineering process, this relates to working in a team, training and Engineering process. The final part of the survey contains questions that relate to Project partnerships and packaging of signaling projects (PPM).

5.7 Summary of Findings

Based the results from the survey shown in the charts in the previous section the following findings and assumptions can be presented: –

Question 1: The results show that there is split opinion and almost equal opposite views on the whether the Engineer has too many projects he or she has to manage, as part of their day to day duties.

Question 2: The results show a majority that the signaling projects are classified as complex to high complexity.

Question 3: The results show that there is split opinion of opposite views but there were more engineers who said there was not enough time to manage other project engineering duties such as safety, environmental and planning.

Question 4: The results show a majority who agree in Admin support to assist Project Engineers.

Question 5: The results show a majority, who have classified themselves as a good team worker.

Question 6: The results show a majority, who agree that they are sufficiently trained. There was approx. 15% who disagreed.

Question 7 & 8: open ended questions in which engineers can add their own comments.

Question 9: The results show a majority, who agree that Packaging of projects would be a good idea.

Question 10: The results show a majority, who agree in a team of project support personnel.

4. Project Partnerships

4.1 Introduction

It has long been the author’s frustration to find new ways of managing multiple signalling projects with limited resource. Gone are the days when all a Signal Engineers involvement were to manage signalling associated issues only, it is also clear that today’s Signal Project Engineer are taking on more and more responsibilities in their role, comparable to a Project Manager, “a jack of all trades”, meaning that the Engineer must be conversant with all of RailCorp’s requirements for operating a construction site.  One method that has been advocated as a solution to improving communication and re-defines new ways of achieving goals is Project Partnering and Project Portfolio Management. Starting with the first of these methodologies Project Partnerships or Partnering. 

Since the late 1980’s there has been many developments and utilisation of partnering models in the construction industry (Laedre et al, 2001).  This has been primary management strategy for improving organisational relations and project performance (Li et al, 2000).

There was a surge of interest in “partnering” when it was first introduced to the Australian construction industry in the early 1990’s.  Partnering, as practiced in the industry, is a process whereby the parties to a traditional “risk transfer” form of contract commits to work together with enhanced communication in a spirit of mutual trust and respect towards the achievement of shared project objectives.  It has been used mostly on resource and infrastructure projects with some notable applications in the building sector.  Author, Jim Ross postulates that partnering has received mixed feedback – in summary (Ross, 2000): – 

(a) Many examples where partnering is acknowledged to have improved the standard of project administration and delivery.

(b) Some examples where both parties have expressed cynicism about the genuineness of the process based on their experiences.

(c) A few notable cases where partnering seemed to do nothing to alleviate adversarial behaviour but served to greatly increase the associated level of bitterness.

Currently, within RailCorp, Project Partnerships are not as popular as Project Alliances or Alliancing and it is important to offer some definitions and comparisons: –

There are many definitions for Partnering, however most of them define Partnering between two or more companies. As a promising methodology for RailCorp’s interests it is more accurate to change the common definition to describe partnering between departments as oppose to companies. The definition that best fits RailCorp’s intentions is: a commitment by those in a project or outsourcing to work closely or cooperatively, rather than competitively and adversarial (MacDonald, 2003).

Other definitions of Partnering can be seen in literature: –

The Partnering concept centre’s around a long-term commitment between two or more organisations for the purpose of achieving specific business objectives by maximising the effectiveness of each participant’s resources. The relationship is based on trust, dedication to common goals, and an understanding of each other’s expectations and values. Expected benefits include improved efficiency and cost effectiveness, increased opportunity for innovation, and the continuous improvement of quality products and services, Construction Industry Institute. (Stephenson, 1996)

Or, Synergy, a co-operative, collaborative management effort among contracting and related partied to complete a project in the most efficient, cost effective method possible, by setting common goals, keeping lines of communication open and solving problems together as they arise (Denver, Department of public works, 1993).

Partnering is a methodology that allows people to minimise or avoid conflict when they are engaged in “complex” projects (MacDonald, 2003). It is a way of unifying all parties as stakeholders in a project into a team. Partnering has also been quoted as “Putting the handshake back into the business and involving a return to the old way of doing business based on trust, respect and good faith rather than suspicion, contempt and skepticism and when a person’s word was their bond and people accepted responsibility (The Associated Contractors of America, 1992).

It is also important to point out that Partnering is in fact a code of conduct and has been stipulated that there is no partnering contract, but an agreed partnering “Charter” that forms the basis of a working agreement that is intended to shape a non-adversarial culture to promote win-win relationship between the parties (Construction Industry Institute Australia).  

There are various methods spouted by authors for Partnering, the following process steps has been adapted and sanitised with a view to application within RailCorp: –

1. Partnering Facilitator – a facilitator is employed to be neutral and to progress the workshop and the partnership.

2. Selection of Project Partners – part of the ground work can be completed prior to the workshop. It is also important to invite the decision makers and potential stakeholder. Additional people can be invited and the actual stakeholders and team players can be discussed at the workshop.

3. initial partnering workshop – These should be timed when major new organisations come onto the project. Troubled projects often reverse course and succeed because of turna- round partnering workshops. Follow-up workshops are used to assess and reinforce the team relationships.

The initial partnering workshop provides the venue for the team to begin the partnering process. These workshops last from one to three days and are conducted at a neutral location away from the organisations’ offices. The work- shops bring the executives, managers and contributors together, as a team, to review and develop actions to address the project’s issues, opportunities and risks. They set the project direction and goals and develop the partnering management processes.

The agenda for the workshop has been collected from a Partnering consultant, (Allan Lowe and Associates, 2010).

• Overview of partnering

• Project overview

• Project organization and lines of communication

• Team communication flows

• Goals for the project

• Key expectations and needs of each stakeholder group

• Identification of potential project challenges

• Develop strategies and action plans to address key challenges

• Develop an issue resolution process

• Partnering follow-up tools and methods

• Identify celebrations throughout the life of the project

• Select partnering champions from each major stakeholder group

• Develop partnering charter

4. Develop Partnering Charter – This is the mission statement in which all partners will sign and agree.

5. Rapid Issue Resolution – One of the strengths of Partnering is the Issue Resolution.

6. Metrics – Are we satisfied with the way we are going?

7. Course correction – feedback

8. 2^nd Workshop – Reinforce new culture

Once back on the job, the project team applies the partnering processes that they have designed in the workshop. They work as a team to complete a successful project by striving to meet the charter goals, by maintaining open honest communications, by resolving issues quickly, and also importantly by pausing from time-to-time to measure and renew their partnering relationships, to bring new members into the team, and to celebrate their successes.

4.2 Benefits of Project Partnerships

• Improved communication
• Improved relationships and job satisfaction
• Provide companies (or Departments) with the opportunity to gain new capacity and expertise
• Resolve conflict and changes quickly (RIR)
• Each partner becomes more aware of what is important to each partner and their needs
• Access to greater resources, including specialised staff and technology
• Sharing of risks with a venture partner

5. Project Portfolio Management

After extensive research, it became clear that “packaging” of Signalling projects does in fact have its own industry terminology. It is widely known in management circles as the term called “Project Portfolio Management”.

Project Portfolio Management (PPM) is a term used by project managers and project management (PM) organisations, (or PMO‘s), to describe methods for analysing and collectively managing a group of current or proposed projects based on numerous key characteristics (Levine, 2005). The fundamental objective of PPM is to determine the optimal mix and sequencing of proposed projects to best achieve the organisation’s overall goals – typically expressed in terms of hard economic measures, business strategy goals, or technical strategy goals – while honoring constraints imposed by management or external real-world factors. Typical attributes of projects being analyzed in a PPM process include each project’s total expected cost, consumption of scarce resources (human or otherwise) expected timeline and schedule of investment, expected nature, magnitude and timing of benefits to be realized, and relationship or inter-dependencies with other projects in the portfolio.

Whilst project management and program management are concerned with “doing work right”, portfolio management focuses on “doing the right work”.

Managing the portfolio is an ongoing business function, like financial management or corporate risk management. It is a permanent activity, whereas projects and programs are of a temporary nature.

PPM is suited to RailCorp’s resource problems, in that the methodology prioritises, optimises and sequences the proposed portfolio of projects. Referring back to section 2 of this report, the background highlights the top 10 obstacles of managing signaling projects, the methodology also focusing on utilisation of rare resource and “Pipeline Management” which is a process for continued projects are being developed.

Getting the most from PPM requires reshaping thinking. Companies should fully embrace the following principles (Merkhofer, 2007): –

• Projects will be managed as a portfolio of investments.
• The goal is to create the greatest possible value (considering the resources available and accounting for risk and organisational risk tolerance).
• For the purpose of decision making, projects will be defined to include the full scope of activities necessary to generate value.
• Because projects produce different types of value in different ways, they must be evaluated and managed differently.
• Value delivery will be managed throughout the project life-cycle and the life-cycle of any products, services, or assets created or enhanced by the project.
• Value delivery practices will engage all stakeholders and assign appropriate accountability for the delivery of project benefits and the realization of value.
• Value delivery practices will be continually monitored, evaluated, and improved.

Portfolio management provides the means to:

• Establish the appropriate structure for selection of programs and projects
• Allocation of the right resources to the appropriate programs and projects
• Ensure ongoing alignment of programs and projects with strategic objectives
• Optimise organisational investment

5.1 Principles of Project Portfolio Management

The process can be simplified into ten steps (Wideman, 2007): –

1. Project Prioritisation – PPM starts with a rational Prioritisation and selection procedure. Key to the evaluation is a selection criterion for nominated project. Projects that do not meet the criteria get rejected and the successful projects move to the next base (Levine, 2005).

2. Identify Needs & Opportunities Portfolio Management

3 Evaluate Options 

4 Select Work

5 Prioritise Work

6 Balance and Optimise the Portfolio – looking resource and criteria

7 Authorise the work

8 Plan & Execute Work (Activation of Projects, Programs, & Other Work) Project Management

9 Report on portfolio status Project Management & PMO

10 Improve the portfolio (Harvest benefits, feedback and change strategy)

It is important to note that during the project selection criteria, that risk analysis methodology is brought in at a very early stage.

PPM is a blend of management disciplines that combines (Ciliberti, 2005)

• A business management focuses to ensure that all projects and programs align with the portfolio strategy.
• A general management focuses for managing an organization’s resources and risks.
• A project management focuses for reviewing, assessing, and managing projects and programs to ensure they are meeting or exceeding their planned contribution to the portfolio.

PPM’s holistic approachrecognises that the portfolio’s health is affected by the performance of all projects within the portfolio, as well as by their direct / indirect dependencies and available resources. Managers should make decisions that lead to overall portfolio success, even if they conflict with the best interests of a specific portfolio project (Ciliberti, 2005).

Combining project management disciplines with business and general management practices at the portfolio level gives an organization the ability to:

• Select projects and programs that are aligned with the organization’s strategies and objectives.
• Make the best use of available resources by applying to the highest priority projects.
• Regularly assess how projects and programs are contributing to portfolio health.
• Take management action to keep the portfolio in compliance with business objectives.

5.2 Benefits of Project Portfolio Management

The benefits it brings the business are (Turbit, 2005):

• Faster response to changing conditions
• More quick wins
• Not having minor projects escalate into major undertakings
• Focus on what will achieve the initiative rather than on the project itself
• Responsibilities centred on one business area rather than trying to compromise across several
• Blending business and projects and treating both as contributors to the same goal
• Portfolios can be constantly reviewed and altered if necessary to produce the highest returns based on changing situations
• Management see the projects as groups of activities contributing to an initiative. They are not a series of unrelated work.
• Dependencies are easier to identify. If we don’t upgrade these servers, we can’t run the new software. Both are part of the same initiative.

Effective use of project management disciplines at the project and program levels improves customer satisfaction, reduces the number of risks and problems, and increases success. The goal of PPM is to realise these same benefits at the portfolio level by applying a consistent structured management approach.

6. Conclusions

Project Partnerships

Partnering has so many benefits that it would be a worthwhile task to introduce to RailCorp for the purpose of managing signaling projects. Briefly touched on in this report is Alliancing, which is similar in some ways, but is commonly practiced in large contracting models and track renewal projects. After all the intention for the signaling department is partnership of departments and not necessarily companies. Although PP has some disadvantages with its implementation, the benefits outweigh the problems. Mentioned in section 6.4, there can problem with soft issues (people), like cultural or leadership (Harrison, 2005), as with most project teams and a good manager, most issues are fixable.

Referring back to section 2.1 of this report, where the underlined problems of managing signaling projects can be matched with proposed solutions associated with either project partnering or portfolio management: –

Demand – Too many Signalling projects

Partnering is certainly a vehicle that can maximise your resource and produce results based on project goals.

Specialist Resource (industry wide) – Not enough Engineers (Signalling Project Engineers) to manage all of the signalling demands.

Documentation and compliance requirements – Signalling Standards, Safety, Environmental and quality requirements. This can be shared within the Project Partnership.

Bureaucracy – too many clients, priority changes, long-winded processes – idea for conflict resolution and partnering benefits.

It is hoped that with the added administration support that can be proposed within a Partnership that the following issues will be reduced or improved:  Contractual and Procurement constraints, Initial funding approval process and subsequent variations, Management of change.

Long lead materials, Signalling Design and access to the infrastructure will remain a problem but with the improved communications lines with Region or Design perhaps some headway can be made.

The open-ended questions shown in the survey raised inherent issues within the RailCorp Project Engineering Process, which could be improved through PP.   

Project Portfolio Management (PPM)

The fundamental objective of PPM is to determine the optimal mix and sequencing of proposed projects to best achieve the organisation’s overall goals. This is also done with the best use of limited resource. This is exactly what is required for signaling projects, to deliver the projects with limited resource. However, the resource we are talking about is a team lead by an engineer or engineers with admin support, which will (speculating) take care of the other responsibilities like Safety documentation, planning etc., to allow the engineer to do their job concentrating on scope and technical aspects.  

Referring back to section 2.1 of this report, where the underlined problems of managing signaling projects can be matched with proposed solutions associated with portfolio management: –

Demand – Too many Signalling projects

PPM through project selection and pipelines ensure the right projects are being implemented. Based on the readings you could speculate that once the process has been bedded in you could improve on delivery of projects.

Specialist Resource (industry wide) – Not enough Engineers (Signalling Project Engineers) to manage all of the signalling demands. PPM excels in resource utilisation, “goal of obtaining the greatest possible value from the available limited resources” (Merkhofer, 2007).

Documentation and compliance requirements – Signalling Standards, Safety, Environmental and quality requirements. This can be shared within the Project Partnership.

Bureaucracy – too many clients, priority changes, long-winded processes – idea for conflict resolution and partnering benefits.

The open-ended questions shown in the survey raised inherent issues within the RailCorp Project Engineering Process, which could be improved through PPM.

Again, PPM seems like a methodology that should be investigated by RailCorp as method of selecting projects, creating a criterion with the stakeholders to generate a portfolio of business sound projects, the use of early risk analysis seems like a good idea. There seem to be a wealth of tools and differing ideas based on PPM, many of which would be beneficial to RailCorp. 

“Project portfolio management” is the latest trend in project management, with books, software, Web sites and conferences proliferating on the topic. But what exactly does it mean? For managers working on projects on a daily basis, it may be viewed as a euphemism for “more work.” But, in fact, this new way at looking at projects is designed to actually make projects work more efficiently to meet company goals and objectives says Jim Joiner, director of the Project Management Program at the University of Texas at Dallas School of Management.

“As more projects and programs take up more time and capital in business, it is becoming critical that these projects are selected effectively by use of a portfolio system that attaches priorities to each project or program,” says Joiner.