CII RT 211: Effective Use of the

Global Engineering Workforce

ModeratorKarl E. Seil

Stone & Webster, A Shaw Group Co.

CII Annual Conference 2005

IMPLEMENTATION SESSION

CII Research Team 211 Members

• Robert J. Beaker - General Motors Corporation (co-chair)• Karl E. Seil - Stone & Webster, A Shaw Group Co. (co-chair)• Hector Brouwer de Koning - Black & Veatch• Dennis Chastain - Mustang Engineers & Constructors, L.P.• Chuan ‘Victor’ Chen - Pennsylvania State University• Gregory Gould - Burns & McDonnell• John Hackney - Nova Chemicals Corporation• Lona Hankins - ConocoPhillips • Robert E. Houghtaling - DuPont Engineering• George Joseph - Pennsylvania State University• Aivars E. Krumins - ABB Lummus Global• John I. Messner - Pennsylvania State University• James B. Mynaugh - Rohm and Haas Company• Batuk Patel - The Dow Chemical Co.• Matthew J. Petrizzo - Washington Group International• Reinhard Pratt - AMEC, Inc.• Gerald A. Schacht - Abbott Laboratories• Bruce A. Strupp – Perot Systems• H. Randolph Thomas - Pennsylvania State University• Todd White - Anheuser-Busch, Inc.

Panel Members

Todd WhiteEngineering ManagerAnheuser-Busch, Inc.St. Louis, MO

Aivars KruminsV.P. – Engineering / ProcurementABB Lummus GlobalHouston, TX

Marcel PrunaicheManaging DirectorWashington Group InternationalRomanian Operations CenterBucharest, Romania

Pooran TripathiManaging Director, Stone & Webster, Rolta Ltd. (SWRL)Mumbai, India

Local Remote

Lona HankinsProject Team LeaderConocoPhillips.Belle Chasse, LA

Dr. John MessnerAssistant Professor, Arch. Engr.Penn State University

A Global Virtual Engineering Team (GVET) is a group of geographically dispersed engineers that needs to overcome:

• Space and Time issues,

• Function and Organizational barriers, and

• National, and Cultural differences

Definition

Brief RT 211 Chronology

• Kickoff Meeting – March 2004

• Survey – April – June, 2004

– Total number of survey responses: 47

• 19 Owner and 28 EPC individuals submitted surveys– Companies: 33

• 13 Owners and 20 EPC companies

• In-Depth Interviews (21 total) – June – August, 2004

– Domestic: 17 managers– Foreign office interviews: 4 managers

• Detailed Case Study – July - August 2004

– 5 projects within one CII company

• GVET Planner Development – August 2004 – March 2005

– 2 Focus Group Meetings to Validate Framework

1.Determine driving factors for GVET.

2.Determine current status of GVETs, tools, and work processes.

3.Define criteria for successful GVET adoption and lessons learned from past experiences.

Develop a planning tool for global engineering work force establishment

and maintenance.

Objectives

GVET Planner Demo

Panel Members

Todd WhiteEngineering ManagerAnheuser-Busch, Inc.St. Louis, MO

Aivars KruminsV.P. – Engineering / ProcurementABB Lummus GlobalHouston, TX

Marcel PrunaicheManaging DirectorWashington Group InternationalRomanian Operations CenterBucharest, Romania

Pooran TripathiManaging Director, Stone & Webster, Rolta Ltd. (SWRL)Mumbai, India

Local Remote

Lona HankinsProject Team LeaderConocoPhillips.Belle Chasse, LA

Dr. John MessnerAssistant Professor, Arch. Engr.Penn State University

Drivers of GVET

DriversOwner EPC Total

Rank Rank Rank

Need to reduce engineering service cost 1 1 1

Competition 7 2 2

Global customers or local customers 6 3 3

Locate services close to the project location 2 7 4

Reduce the engineering schedule 4 6 5

Expand detailing work for same cost 5 8 6

Success & Failure Factors

Success Factors Failure FactorsClear & frequent communication, periodic face-to-face meetings (16)

Lack poor communication, lack of face-to-face meetings (19)

Good communication tools & IT compatibility (15)

Lack of understanding of local work practices, cultural differences, and/or language issues (14)

Standard work processes and communication procedures (11)

Lack of management involvement & experienced leadership (9)

Clearly defined scope & expectations (10)

Changes (goal, scope), slow response to change (8)

Clearly defined roles & responsibilities (9)

Incompatible or poor technology, including hardware and software (7)

Impact of GVET on Project

Owner EPC Majority Opinion

Engineering Cost 50.0 % 46.1 %More than 10%

reduction

Construction Cost 71.4 % 79.1 % No impact

Engineering Time 57.1 % 40.0 % No impact

Overall Project Delivery Time

57.1 % 60.0 % No impact

Engineering Quality 57.1 % 72.0 % No impact

Construction Quality 64.2 % 79.1 % No impact

Typical Impact on:

 

OWNER EPC

more than 10%

increase

0-10% increase

Same0-10%

reduction

more than 10%

reduction

more than 10% increase

0-10% increase

Same0-10%

reduction

more than 10%

reduction

ENGINEERING COST 7.1 0 7.1 35.7 50.0 0 3.8 7.6 42.3 46.1

CONSTRUCTION COST 0 7.1 71.4 14.2 7.1 0 0 79.1 20.8 0

ENGINEERING TIME 0 7.1 57.1 28.5 7.1 4.0 28.0 40.0 20.0 8.0

OVERALL PROJECT DELIVERY TIME

0 14.2 57.1 28.5 0 0 4.0 60.0 32.0 4.0

ENGINEERING QUALITY

7.1 14.2 57.1 21.4 0 4.0 8.0 72.0 16.0 0

CONSTRUCTION QUALITY

0 21.4 64.2 14.2 0 4.1 16.6 79.1 0 0

For projects performed by your company with Global Virtual Engineering Teams, what is the typical impact on:

Impact of GVET

Panel Discussion / Q & A

Todd WhiteEngineering ManagerAnheuser-Busch, Inc.St. Louis, MO

Aivars KruminsV.P. – Engineering / ProcurementABB Lummus GlobalHouston, TX

Marcel PrunaicheManaging DirectorWashington Group InternationalRomanian Operations CenterBucharest, Romania

Pooran TripathiManaging Director, Stone & Webster, Rolta Ltd. (SWRL)Mumbai, India

Local Remote

Lona HankinsProject Team LeaderConocoPhillips.Belle Chasse, LA

Dr. John MessnerAssistant Professor, Arch. Engr.Penn State University

Experience of Survey Participants

• Greater than 5 years of personal experience with global virtual engineering teams:Owner: 15.7%EPC: 55.5%

• Greater than 5 years of company experience with global virtual engineering teams:Owner: 52.6%EPC: 62.9%

• Companies with more than US$100 million size projects executed with global engineering teams:Owner: 47.3%EPC: 55.5%

• Owner: 57.8% use global VT on many projects EPC: 66.6% use global VT on many projects

• Plans to increase implementation of global virtual teaming:Owner: 68.7%EPC: 92.5%

Team Dynamics / Commitment

• 74% of EPC respondents have permanent domestic & overseas engineering design offices participating in global virtual teaming.

• How does global VT impact the “team” feeling for individuals who are geographically isolated from the majority of the group?

Owner 73.3% responded as ‘feel LESS like an integrated team’EPC 68.0% responded as ‘feel LESS like an integrated team’

• Team members have less trust:Owner 57.1% EPC 61.5%

• Does a Global VT increase the time spent by your project management team on the project?

Owner 42.8% responded ‘yes’Range: 25%, 20%, 15+%, 15%, 10%, 3-5%

EPC 77.7% responded ‘yes’ Range: 75%, 40%, 20%, 15%, 10%, 5%, 2%

Technology

ResultOWNER EPC

Responses Percentage Responses PercentageE-mail 15 93.7% 27 100.0%

FTP 5 31.2% 16 59.2%

Video-Conferencing 11 68.7% 21 77.7%

Web-Conferencing 10 62.5% 15 55.5%

Virtual Private Networking 4 25.0% 16 59.2%

Project Specific Websites 10 62.5% 22 81.4%

Applications for Simultaneous Remote Collaboration

5 31.2% 17 62.9%

Common Repositories for Project Information

14 87.5% 20 74.0%

Knowledge Management Systems, e.g.: lesson learned databases

6 37.5% 18 66.6%