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Engineering Project Management Training

Engineering Project Management Training. June 25,2015 Revision A.4 Author: Kevin Wald. Agenda. Vantage Point Client Information Project Building Blocks Building Block: Timeline Project Budgeting Controls Utilized Macro (Department Wide) Controls Utilized Micro (Project Specific)

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Engineering Project Management Training

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  1. EngineeringProject Management Training June 25,2015 Revision A.4 Author: Kevin Wald

  2. Agenda • Vantage Point • Client Information • Project Building Blocks • Building Block: Timeline • Project Budgeting • Controls Utilized Macro (Department Wide) • Controls Utilized Micro (Project Specific) • Summary

  3. Vantage Point SpecSys Mission Statement: A full service provider of project management, engineering and manufacturing for fast track projects, systems and products.

  4. Vantage Point Project Management as a Contract Engineering Firm is different than from the vantage point of an employee at an OEM.

  5. Vantage Point • OEM (Our Client): Return on Investment (ROI) comes from future sales, and margin generated (Overhead and Profits), from product designed. • Contract Eng. Firm (SpecSys): We live, or die, within the timeframe of the project. When the project is done, we either made money, or we did not.

  6. Impact of Vantage Point • SpecSys must not give away “sizeable” blocks of time if not within scope of the agreement. • However, SpecSys cannot “nickel-n-dime” client if they are to receive business in the future. • Most difficult project: Death by a Thousand Cuts

  7. Client Information • SpecSys Account Executive attempts to gather clear direction on what is IN and what is OUT of SCOPE. • Seldom (Never) do we get 100% clarity. • Understanding the assumptions in the beginning of a project is paramount.

  8. Client Information • Project Leadership = YOU: • Understanding the assumptions of IN SCOPE vs. OUT OF SCOPE of your project is PARAMOUNT! • YOU are a key control point in bringing a project in: • On-Time • On-Budget • Done-Right • Done-Safe

  9. Building Blocks of a Project • Timeline: Start, Duration, Need Date (End) • Identify Key Milestones • Labor: Total Hours Required by Labor Type • Drafter, Designer, Eng., Mfg, Test, Tech Pubs, etc. • Staffing Levels: Labor (FTE’s) • FTE: Full Time Equivalents of each Labor Type • Materials: Stuff Required (plus Freight $) • (Discuss Materials Policy vs. Firm Fixed Contract)

  10. Building Blocks of a Project • Contract Types • Firm Fixed: • Scope of project is reasonably defined, deliverables are known • Price is agree upon • Example: You complete 1000 hour bid in 900 hours, you make more profit. • Cost Plus: • Many unknowns = danger of burning client • Communication is key, every step of the way • Client pays for all hours worked on project • Historically: Worst burned clients have occurred with Cost Plus

  11. Building Block: Timeline • Know your key Milestones: • Engineering & Design Phases: • Kickoff, CDR, DDR, Prints Developments, Redlines • Prototype: • Material Lead Times, Mfg Start Date, Checkout Date • Qualification Phase: • Test Start (Calendar Window?), Test Completion Date • Production: • Tooling Design, Tooling Build, Tooling Qualification? • Material Lead Times, Production Start, Qty/Month

  12. Building Block: Timeline • Specifications • Entire project flows back to the specifications • Configuration Specifications • Performance Specifications • These ultimately define what the client desires for the market • Each and every CDR and DDR meeting should begin with • Section 1.0: Specification Review • These do change as a project progresses • They need to be kept current and kept in front of the client

  13. Building Block: Timeline • CDR Phase • System Schematics Designed • Power calculation(s) completed for Hydraulic and Electrical • Key Purchase Items Selected (Big Stuff Selected) • All BOM Groups Completed • Top level engineering analysis completed with Top level CAD Models done • “Metallic” parts not drawn per mfg methods yet • DDR Phase • All remaining purchase items selected early (Little Stuff Selected) • Detail level engineering analysis completed • How to mfg fabrication & weldments identified and considered into design

  14. Project Budget

  15. Project Budget • Compare: • Compare to Prior Similar Project • Bottom Up: • Summation of Labor, Materials, Outsourcing, and other Resources • Client: • Gather Data from Client on How They Would Perform Project • Typical = All Above

  16. Project Budget Example • CDR Phase: 300 hours * $75/hr = $22,500 • DDR Phase: 350 hours * $75/hr = $26,250 • Print Dev: 200 hours * $65/hr = $13,000 • Total Engineering: 850 hours = $61,750 • If assign 3 people and 40 hrs/week • Non billable = 15%, available 40 hrs * 0.85 = 34 hrs/wk • 850 hours/34 = 25 weeks/3 staff = 8.3 weeks • $61,750 / 8.3 weeks = approximately $7,440/week

  17. Project Budget Example Example Project Prior Page: • 25 weeks x 40 hours paid to employee = 1000 hours • $61,750/1000 hours = $61.75/Hour on the Financials • Non Billable = Vacation, Sick, Holidays, Company meetings, etc. • Each person overruns project by 5 hours a week (hour a day) • 5 hours/40 hours per week = 12.5% in-efficiency • Total hours goes up by 125 hours on the project (overrun by 125 hrs) • 25 staff weeks x 5 hours/week = 125 hours • $61,750/1125 = $54.89/hour, down from $75/hour quoted • New Junior Staff person is 50% efficient • Lose another 141 hrs (8.3 weeks * 34 hrs = 282 * 50% = 141) • $61,750/1266 = $48.77/hour, down from $75/hour quoted = ON BUDGET?? • 1266 hours / 34 hrs/week = 37.2 weeks / 3 people = 12.4 weeks = ON TIME??

  18. Project Budget Example Example Project Prior Page: • One Hour a Day and a new employee! • On Time: You are a Month Late (12 weeks instead of 8 weeks) • On Budget:You are almost $30/Hour Below Bid Price • View One: $30/Hour x 1266 hours = $37,980 on a $60k project • View Two: 266 lost hours from another project = 266 x $75/hr = $19,950 • Done Right:You Panic because you are behind time • Cut a project management corner!!! It can roll up on you very quickly, even when you manage a project within 20% of the bid hours.

  19. Project Budget Apply Feedback Loop Theory • Assess → Revise → Choose → Execute • → Assess → Revise → Choose → Execute • → Assess → Revise → Choose → Execute • → Assess → Revise → Choose → Execute • → Assess → Revise → Choose → Execute

  20. Controls Utilized Macro Engineering Department Wide Controls • Revenue Projection Updated on 10th and 25th of Each Month • 100% Complete and Accurate: Each and every 10th and 25th • Complete Flow Out for ALL Signed Projects, Out to End of Signed Funds • Identifies: Project Lead, $/Hr, $’s Utilized To Date, and much more • Staff Loading Chart Weekly • What Staff are Assigned to What Project • Four Week Projection Minimum • Project Leads: You have 100% responsibility to gainfully assign tasks to all members identified to their project(s) • Monthly Profit & Loss (P&L) and Balance Sheet Financials

  21. Controls Utilized Micro Project Level Controls • CDR and DDR Outlines Populated Early (first week) • Updated as design phase progresses • Used to Chart % Completeness of Project Phase! • BOM Early and Often (Global Shop) • Top Levels Pre Populated early with Machine/Device structure • All levels continue to Populate as design phase progresses • CAD Model uses same part numbers in Global Shop • Less Customer Prefix • Used to Chart % Completeness of Project Phases! • Time Force and Global Shop Labor Reporting • Used to Chart % Completeness of Project Phases!

  22. Controls Utilized Micro Project Level Controls – For Builds • Global Shop BOM Pre-Populated at project start • Structure supports the way the machine will be sold • Base –standard every machine broken up functionally • Select – mandatory option selection, example, tire selection. • Option- a non mandatory option selection. • Functionally related • Sub levels and detail added as design progresses • Global Shop Item Master - Enter complete information • Proper GENERIC description. Example; Valve, Two Way Solenoid • Make/Buy • Complete vendor information • Global shop is our communication/release tool. Full release is 100% required to support a build.

  23. Controls Utilized Micro Project Level Controls – BOM Structure • BOM Structure is defined early and logically. • Think machines within machines, i.e. a cab can have it’s own Electrical Group separate from the Chassis Electrical group, etc. • BOM groups always support how the machine is sold and are “digestible” i.e. small logical group functionally related that can support all downstream users. (tech pubs, service, manufacturing, purchasing) • BOM groups can and should be used to organize assignments within an engineering team. i.e. one group can have the cab, another the suspension, chassis, options, etc.

  24. Controls Utilized Micro Project Level Controls • Monthly Executive Summaries • Communicate Key Status and Issues to Client • Project Lead: Publish Each and Every Month • Goal: Do Not Surprise Your Client At the End • Action Item List • If Not on the List, It Does Not Exist • Project Work Books Up To Date 1st and 15th of each month • These are a “Work Book” Not a Post Process Effort • Hydraulics • Electrical • Controls • FEA

  25. Controls Utilized Micro Project Level Controls • Project Leads: TRUST BUT VERIFY • CDR & DDR Outlines Early & Often • BOM & Parts Master in Global Shop Early & Often • Action Items List Early & Often • Project Work Books 1st & 15th • Hours Consumed To Date Weekly • $/Hr Quoted vs. $/Hr To Date • Hours Needed to Complete Weekly • Staff Loading Who & How Many Weekly

  26. Controls Utilized Micro

  27. Controls Utilized Macro/Micro

  28. Summary • Good Project Management: It is NOT Complex, But It Is Hard! • You Must Do What-We-Say-We-Do each and every week • Prior Issues: • High Non-Billable Rate of Staff • Service is a “Perishable Product” • Once gone, you do not get it back. • An 80% Complete CDR Effort means you are behind! • Comes Home to Roost at Print Development • We should know at the 7 hour of a 12 hour effort we are behind. • Waiting until 11 hour is too late to adjust staff & inform client • 120% in one area of the design and 80% in another, does not = 100%. • Getting ahead does not average out, entire design must be at 100% CDR, or DDR • Most of “SpecSys Golden Rules” Comes from these basic concepts.

  29. Summary Do What We Say We Do! “It does require discipline and tenacity; one must get at it and stay at it!”. Jon Fitch

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