Case Study: Productivity Audit

Redwater, Alberta
$5 Billion
5000 Craftworkers
Study period: February 2016 – September 2016

Insight‐AWP has been involved in the examination and management of productivity on mega projects since 1998 and conducting Time on Tools studies and applying Advanced Work Packaging (AWP) and Installation Work Packages (IWP) in both North America and Europe over that period.

The system utilized for Time on Tools analysis is a proven methodology that is recognized as a key measurement tool within industrial engineering.
Working with both COAA (Construction Owners Association of Alberta) and CII (Construction Industry Institute), Insight‐wfp staff have been key contributors to the model for Workface Planning and have applied the process to 24 mega projects.

In 2015, Insight‐AWP were contracted to perform Time on Tools studies and WFP audits at the Project-N site by the Owner. The studies started mid‐February and concluded late September 2016. Twelve study cycles were completed across the 9 major units, comprising of over 80,000 total observations. At the close of each cycle, a report on the findings was presented to the specific Construction Management Team, Mechanical Contractor and the Owner’s Project Management team.
The reports were presented to the Construction Management teams with cause and effect observations that supported the numerical evaluation. Commitments for actions by the CMT and the Contractor were then logged and tracked by the Owner’s PMT.

During the period of the Tool Time analysis, Insight‐WFP also conducted specific audits of Workface Planning practices against each area based upon alignment with the Project-N AWP procedure, which had been issued with each contract. The results appear in the chart as the AWP score, which is a % of compliance with the procedure.

Time on Tools: Executive Results Summary

Time on Tools: Value Added Comments

  • North America’s direct activity according to CII literature is 37.8%, Insight‐AWP data for Alberta Megaprojects is 39 ‐ 40% and Owners’ overall results are 42.44%. Note, a 1% increase in DA = 8 Days of schedule per year and $9 Million of cost per Billion of TIC (Total Installation Cost) and 1/40 = 2.25% productivity improvement and the same ratio of cost and schedule reduction. Construction cost is estimated at 40% of TIC.
    This means that the project outperformed normal Alberta projects by 3%: Calculated over 2 years and $5 Billion = 48 Days of Schedule and $135 Million in cost.

This chart clearly demonstrates the alignment between compliance with WFP principles and activity levels of the craft workers.

The delta between the most compliant (which is still only 77% compliant) and the least compliant (business as usual) is 38 to 45.1 % Direct Activity which is 7.1%
7.1 / 40 = 17.8% increase in productivity, which averaged across the project shows that if all contractors had achieved 77% compliance then the project costs would have been reduced by $356 Million and 65 days of schedule per year.

This would have a generated a return on investment of 900%, based on the cost of implementation at 2% of Direct Labor.

Other influences:

  • Hawthorne Effect ‐ the alteration of behavior by the subjects of a study due to their awareness of being observed. Our study cycles were short enough in duration that the Hawthorne Effect was not evident; tradespeople were observed in their natural state.
  • Mechanical Contractor management used the “Good Cop/Bad Cop” approach, with Insight‐AWP being the “Bad Cop” to effect change with their supervision. This approached worked well.
  • What gets measured is managed. Insight‐AWP received comments from field Foremen and GF’s that their respective Upper Management made improvement changers during and after our study cycles.
  • A “healthy competition” was created across units with frequent questions on how they compared with each other. One contractor having three units, it was very noticeable in private conversation within Units personal.
  • Provided third-party input from tradespeople who understood our role from other Alberta projects to share their productivity concerns.
  • Project management who do not get into the field as often as they would like or desiring to get feedback from a neutral source would stop by our office to get our “boots on the ground” perspective.
  • Though our methodology has no bearing or relationship with PF calculations, our Time on Tools results was often used to gain insight to the contractor PF.
  • Close out cycle review meetings were always interesting, often what was presented was already known by the different parties but by providing resulting data expressed in percentages the “required meat to the bones” to activate action occurred.
  • All parties accepted cold eyes review of unit infrastructure and tradespeople movements with interest and questions.

Time on Tools – Lessons Learned, Comments

  • Would have liked to conduct a non‐union and fixed price contract unit studies to compare against the union and time & materials units.
  • Would have also liked to Conduct a night shift Time on Tools for a comparison review.
  • Had a five‐minute presentation at site orientation to gain trade’s people understanding, buy‐in, and stronger input when they saw us in the unit doing the study.
  • The opportunity to investigate the root cause of suspect work processes and recommend opportunities for improvement of the work process if warranted.
  • The Time on Tools results was the focus of attention and improving the results was a constant aim of the construction management teams, however, the improvement strategies all targeted short-term gains. None of the areas addressed their compliance with Workface Planning procedures and yet the study clearly demonstrated that this was the primary influence on the Time on Tools results.
  • The productivity team would have like to have the opportunity to work with the contractors who were underperforming in the field of Workface Planning, to increase their compliance with the procedure.

Workface Planning Value Added Comments

  • Owner’s Workface Planning Procedure was well planned and written.
  • Contractors that aligned closer to Owner’s Workface Planning Procedure had higher direct activity numbers in the Time on Tools studies.
  • Contractors that utilized experienced/seasoned tradespeople as planners had more executable IWPs (Installation Work Packages) than those that used engineering coordinators.
  • Shift by Shift, constraint-free IWPs designed for one foreman was not achieved by any contractor on this project, which shows that there is, even more, room for improvement.

Workface Planning Lessons Learned Comments

  • No contractor on site was providing their foreman with executable IWPs designed for one shift. Instead, foremen were provided with large multi-week plans to execute at their discretion. IWPs were also passed from foreman to foreman. If constraints were present the Foreman had to deal with the problem, this is not the desired output of WFP.
  • Constraint-free plans were not the norm by any on‐site mechanical contractor.
  • Engineering firms that had construction input during the design phase had stronger AWPs (Advanced Work Packages) and thus created better IWPs.
  • The owner should have a full-time Workface Planning Manager to oversee the engineering firm’s adherence to AWPs as well as contractor IWP development.