About

Projects don’t run themselves.

Project Assurance

Introduction

“Project Assurance” is not phrase that we have newly invented. Any casual search on Google will reveal that the UK Office of Government Commerce (OGC) has a good claim to originating the term and defining it in PRINCE2.

We borrow a great deal from all of the work done in the past to define and describe what Project Assurance is and how it is done. We introduce some new concepts which are consistent with, and extensions of, the overall definitions. And we apply our own definition and make it our own.

All kinds of enterprises, companies and organisations which conduct their business as projects, of all kinds, are concerned with governance, control, compliance and consistency. They make efforts towards building management systems for achieving the desired outcomes and results. All want a system that works to achieve an effective level of project control.

Management systems range from virtually nonexistent, or primitive and ad-hoc, through to sophisticated and complex.

Some systems are too simple, and plainly inadequate and incapable of providing the necessary level of control.

Other systems are extremely complex, and yet also fail to provide sufficient project control.

Through decades of experience, we have become concerned that typical project management systems in all kinds of organisations are fragmented, often undocumented and largely ineffective. They are misunderstood by the people who have to use them. They cost a lot of money, time and effort to set up and maintain. They don’t work and they don’t pay off.

Even where the best efforts have been made to apply the very best theory and execution there are still gaps.

Systems either don’t exist at all, or where they exist they don’t work. Where they work, they don’t always work perfectly.

We think there is something missing, and we think we know what it is.

Perfect Project Assurance (PPA) is a new product which applies a range of project management system and risk management methods and tools to ensure that projects are governed systematically and rationally to produce tangible results, primarily on-time and on-budget delivery.

Projects involve various individual people and parties, all of whom have their own separate interests in the project. These people and parties are commonly referred to as the “stakeholders”.  Their separate interests may be in conflict with each other. Everyone involved wants projects to be success stories, and everyone has ideas about how to achieve success, however that might be defined. Vast efforts have been undertaken to work out why projects fail in various degrees in one way or another. There is mountains of research and literature aimed at identifying the causes of project failure and eliminating them. Finding the perfect formula, the right balance and the magic key is the holy grail for project management. However, the road to hell is paved with good intentions. The answer is elusive. All too often, the effort to build management systems degenerates into layers of expensive and ritualistic bureaucracy which add no value at all and may even end up being hated by the people who have to use it.

The Project Assurance product consists of a fully documented framework which includes:

  • Proactive, comprehensive governance
  • Auditing project management systems
  • Investigation of the tools in use, primarily software tools
  • Investigation of the expertise of the people using the tools, an assessment of their familiarity and fluency with the tools
  • Investigation of the contracts which apply to any given project.
  • Providing advice, recommendations, suggestions and objective reporting with respect to compliance, completeness and effectiveness.

When the client engages PPA, our highly skilled team of experts reviews an existing project management system

or creates the project plan and determines the most efficient critical path.

We work with the contractors to ensure that the project plan has been perfected.  Our engineers monitor actual progress in real time against the project plan and report the variations and attribution for those variations.  We identify early any variations which may affect the timeliness or cost of the project.

Perfect Project Assurance has the following features:

  • independent assessment of any project plan;
  • real time comparison between the project plan and actual performance;
  • early identification of variance between plan and performance;
  • objective attribution for the causes of variance between the plan and actual performance;
  • predictability in and verification of the timing and quantum of project progress payments and claims;
  • reduces the scope for litigation arising from disputes between service providers;
  • in the event of litigation, provides objective data to determine cause and effect;
  • provides “clerk of works” oversight; and
  • delivers projects on time and on budget subject to specified conditions.

The Perfect Project Assurance system works by:

  • Modifying standard project contracts to include a set of provisions which initiate the PPA
  • The standard contract clauses provide for the preparation of a defined project plan, and procedures for monitoring, measuring, assessing, auditing and reporting by trained staff.
  • Based on accurate and timely comparison between the Perfect Project Plan and actual performance it is possible to continually update the plan to optimise the critical path to completion.
  • Optimising the critical path allows optimisation of resources and cash flow.
  • Legal disputes are almost entirely eliminated by timely and accurate attribution of departures from the plan.

Perfect Project Assurance is not insurance, it does not pay compensation for claims.  Instead, the risks inherent in any project are directly managed with state of the art software and work systems.

Applying Project Assurance takes any project out of the category of 80% of projects that fail to finish on-time and on-budget.

To ensure the highest possible standards of governance with the degree of control required to fully benefit from Perfect Project Assurance, PPA is licensed by the Australian Prudential Regulatory Authority (APRA) as an Australian financial service.

This financial services guide outlines the services and products we can offer you and explains how we and other relevant persons are renumerated for these services.

You can contact us:

Description of Product

PPA is a financial services product which will revolutionise the management of project risk.

Ask this question, “if projects are at risk of costing more than they should or taking longer than they should, why cannot this be insured against like any risk?”.

The approach to ameliorating or mitigating these risks is primitive. Project owners write contracts that include liquidated damages. Contractors address the risk of liquidated damages by building in increased prices to cover the near certainty that they will finish late and will be liable for the LDs.

Decades of research into the low productivity and poor record of construction projects meeting their contract finish dates and budgets.  According to the Australian Institute of Building Management some 80% of construction projects are not completed on time nor within budget.

PPA will improve the quality, predictability and productivity of the construction sector in much the same way that shipping insurance lifted the standards of the shipping industry in general; and fire insurance dramatically improved building design and fire management systems.

Every project requires the assembly and co-ordination of numerous resources.  Without PPA, each component tends to manage their risks by defining their obligations as narrowly as possible within the terms of their engagement. Early in the project life, PPA identifies and fills any gap that may affect the completion date or budget.

PPA does not displace any existing service providers but supplies skilled personnel in any field to monitor, measure and assess actual performance against the approved plan, identifying and recording any changes as they occur and modifying the project plan as and when required to meet the key project milestones.

Common causes of legal disputes are eliminated by PPA systems ensuring that claims are resolved quickly, simply and accurately with comprehensive and objective record keeping.

Systems

Research has demonstrated that projects adhering to pre-defined systems are far more likely to finish on-time and on-budget.  PPA can utilize any existing software tool for project planning.  PPA will collate and reconcile all systems utilised by the project service providers and incorporate them in our stochastic critical path programme with on-site monitoring, measuring and assessing of actual progress against the plan.  Variations can be accommodated when beneficial or prevented if necessary by ensuring that the relevant service providers are kept accurately and promptly informed by PPA reports.

Reporting

Comprehensive, accurate and timely reporting is an essential component of PPA.  Reports from service providers and our own skilled staff are incorporated into the project software.  Current status reports are provided by PPA to project principals, financiers, supervisors and  specific service providers as required.  Standard reports will compare actual progress to the master plan, list variations with attribution of causes and provide an updated master plan and budget.  Standard reports will also include the procurement schedule, resources schedule, purchase orders, key milestones and many more.

Governance and Compliance

PPA is a powerful governance and compliance tool.  Variations from the plan are quickly identified, measured, assessed and attributed.  The PPA systems minimize the scope for malpractice by any service provider to the project and quickly identifies and attributes causes. PPA provides prompt reports to relevant parties according to agreed protocols. Governance is overseen by a Board comprising a majority of independent directors who are experts in their field with a mandate to seek continual improvement and the highest standards of excellence.  The Board is overseen by APRA who ensure that the appropriate governance standards are met for the continued licensing of the financial product.

Fees

PPA charges a fixed ad valorun fee comparable with any highly effective manager with incentives for over performance.

The clients expected return is that the assured project is completed on time and on budget with minimal disputation, litigation and performance bonds.

With some projects the assurance programme will result in significant time and budget savings far in excess of the fees.  These gains are objectively quantified and delivered to the client with a 20% over-performance bonus.

Exclusions

PPA ceases to apply where the client denies access to critical data; the client fails to provide agreed levels of transparency, and; the client disregards the agreed protocols.