Article #542 Improving the Monitoring, Evaluating and Reporting the Performance of Long Lead Procurement Items on Capital Construction Projects

For capital construction projects, long lead items are those construction components that will require a long time to obtain. In many cases the long lead items will require the approval of shop drawings, or formal submittal approval, prior to ordering. The procurement of those long items can often have a significant impact on the project schedule as installation, construction and commissioning activities are heavily dependent on the delivery of these items.

Therefore, long lead items should be correctly identified at the start of the project and incorporated in the project schedule. The procurement activities of long lead items should be periodically tracked to forecast any delays to the project’s milestone completion dates. The Long Lead Procurement is one of those reports that are commonly used on capital construction projects. The data for this report should be extracted from the purchase orders issued for the long lead procurement items which will be associated with it is relevant project schedule activity.

The majority of long lead procurement items are usually manufactured and shipped from different countries to the country where the capital construction project being executed. Those items could be shipped by Sea, Land or Air depending on the most economical and practical method to ship those items. Nevertheless, the planned shipping method could be changed for delayed items and for which the delivery duration needs to be accelerated.

The traditional reporting of the status of long lead procurement items might be somehow ambiguous for some stakeholders. Therefore, including a map that will detail the shipping location for those items along with the option to select procurement items by the package or system they belong to, country of origin and procurement status will be required and shipping method. In addition, the report can be used to report on the status of procurement items across the complete projects portfolio that the entity has.

Using Project Management Information System (PMIS) like PMWeb as the trusted platform to manage the business processes for capital construction projects which will include the project schedule and purchase orders for long lead procurement items coupled with an interactive business intelligence and data visualization tool like MS Power BI this challenge can be addressed. With the many types of visuals that can be used in MS Power BI to visualize and analyze the projects data captured in PMWeb, there will be a requirement to use the map visual “Icon Map” which is a custom visual that allows in showing the origin of all long lead procurement. This requires providing the geospatial points for the shipping origin and the destination which will be the project construction site. The colors of the connecting line can be selected to reflect the shipping method which could Sea, Land or Air.

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The reader of the Long Lead Procurement Schedule Status Report can drilldown to any specific procurement item to have full details on its full shipment history status as well as other details that might not be captured at the status report. The report will include a map that will display the shipment status of the equipment on a map show the current status, past shipment history and planned route to the project site.

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PMWeb commitment module which will be used to capture the details of all long lead procurement items purchase orders will be configured to include six additional user defined fields. Those will the fields for procurement group, building systema and equipment type. In addition, there will two fields for the latitude and longitude fields of the shipment origin. The latitude and longitude fields for the destination or project construction will be defined on the project module. The last user defined field is the project schedule activity that relates to the long lead procurement item. For purchase orders that include multiple long lead items, the project schedule activity field will be assigned at the item level. This will enable reporting on the procurement status of each item if this is required.

To ensure that the long lead procurement schedule activities are current, the updated project schedule needs to be imported from either Primavera P6 or MSP unless the schedule was created in PMWeb. This will ensure that the date calculations for long lead procurement items are accurate and up to date.

PMWeb custom form builder will be used to create the template to capture the shipment history of each long lead procurement item. The template will include a table that will detail the latitude and longitude values for each date in the track report. Those dates will be classified as either Actual, Now or Plan to identify the status of the shipment. Additional details can be added as the location name, method of shipment since an item might be shipped via Land or Rail before it get shipped by Sea, and the vessel name. This data will be the data source used to plot the shipment route of each long lead procurement item.

To provide complete transparency on the procurement of long lead items, all supportive documents need to be attached to the purchase order as well as the shipment tracking report. Those documents could include copies of the original issued purchase order, factory-based test certificates, shipping documents, clearance documents, delivery notes, pictures of the long lead items among many others. PMWeb attachment tab in those templates will be used to attach all those supportive documents. It is also highly recommended to add comments to each attached document to provide better understanding of what was the document for. The attachment tab also allows the user to link other records for business processes implemented in PMWeb as well as associate URL hyperlinks with websites or documents that are not stored in PMWeb document management repository.

All those supportive documents need also to be uploaded into PMWeb document management repository so they can be stored and used. Those documents could be uploaded into folders or subfolders so they are better organized and secured. PMWeb allows setting access rights to each folder to identify the users who have access rights to view documents stored in a folder. In addition, PMWeb allows setting notifications for individuals to receive emails when new documents are uploaded or existing documents were downloaded or deleted.

About the Authorfounder

Bassam Samman, PMP, PSP, EVP, GPM is a Senior Project Management Consultant with 40-year service record providing project management, project controls services and project management information system to over than 200 projects with a total value in excess of US $100 Billion. Those projects included Commercial, Residential, Education and Healthcare Buildings and Infrastructure, Entertainment, Hospitality and shopping malls, Oil and Gas Plants and Refineries, Telecommunication and Information Technology projects. He is thoroughly experienced in complete project management including project management control systems, computerized project control software, claims analysis/prevention, risk analysis/management (contingency planning), design, supervision, training and business development.

Bassam is a frequent speaker in topics relating to Project Management, Strategic Project Management and Project Management Personal Skills. Over the past 40 years he has lectured at more than 350 events and courses at different locations in the Middle East, North Africa, Europe and South America. He has written more than 500 articles on project management and project management information systems that were featured in international and regional magazines and newspapers. He is a co-founder of the Project Management Institute- Arabian Gulf Chapter (PMI-AGC) and has served on its board of directors for more than 6 years. He is a certified Project Management Professional (PMP) from the Project Management Institute (PMI), a certified Planning and Scheduling Professional (PSP) and Earned Value Professional (EVP) from the Association for the Advancement of Cost Engineering (AACE) and Green Project Management (GPM).

Bassam holds a Masters in Engineering Administration (Construction Management) with Faculty Commendation, George Washington University, Washington, D.C., USA, Bachelor in Civil Engineering – Kuwait University, Kuwait and has attended many executive management programs at Harvard Business School, Boston, USA and London Business School, London, UK.


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