David Whitmore and the Nuclear Project Management Specific Interest Group (Nuclear PM SIG) identified investor confidence in the predictability of project delivery as a key challenge in the UK. On time and on budget projects are of concern to ministers, regulators, and investors alike.
The SIG, a joint initiative between APM and the Nuclear Institute, recently published a blog that points to some unique-to-nuclear-and-the-UK issues that contribute to this problem, namely – many stakeholders and complex operating models makes collaboration and decision-making difficult, ditto complicated engineering design solutions. They posit that “complex nuclear projects need timely decision making to be successful but slow governance inherent in western nuclear projects makes this challenging.”
We agree. ‘Slow governance’ and its impact on timely decision making needs to be resolved. Investigating benchmarks and methods used on projects (nuclear or otherwise) around the world will help the nuclear industry find new solutions.
We’d like to explore if a change in the focus of the programme board to objectives and benefits, rather than the current focus on the outputs and outcomes, would resolve this.
What gets measured, gets done
Outside stakeholders (government, regulators, investors) apply a risk premium to nuclear projects, and we believe it’s in part because they don’t have confidence in programme reports where the targets keep shifting as tranches and sub-programmes are added or removed. We believe confidence is low because the reports are too low-level and don’t report on what stakeholders really want to see.
In our hypothetical future, the programme management team report to the programme board on the achievement of objectives and realisation of benefits for every period end and every tranche. The board no longer focus on the project specifications (the outputs); these should be the domain of the project and programme teams.
To illustrate from decommissioning, a programme objective of reviewing paper records:
- Ensures compliance with the law and regulations concerning the retention and destruction of records.
- Reduces costs of the storage space for paper that is no longer needed.
- Once the records are catalogued, and even more so when they are digitised, speeds up retrieval. This reduces the cost of waste management and means that activities complete faster, ultimately bringing forward the day when a particular hectare of site land can be restored to green field.
- The data management skills are tradeable – staff can obtain other high-paying work in data management outside of the nuclear industry, boosting the economy and creating jobs.
- Rapid access to records during an emergency (or an exercise to simulate an emergency) improves safety and reassures the public and watchdogs that the site is managed well.
This could be delivered in many ways: as long as the objective is achieved, the programme should be seen as a success. Previously, a change in direction at project level would cause delay and cost overruns, and this is the scenario we would like to change.
Empowering the right people to make the right decisions
The programme board gets out of the detail and focuses on the big picture. Objectives and benefits change much more slowly – may even remain constant throughout the lifetime of the programme. Period end reports show progressive realisation of benefits, and this year’s reports can be compared with last year’s reports because the targets haven’t moved – even if the projects and tranches have changed, which they do frequently in nuclear industries.
Workstream, tranche and project decisions are no longer escalated to the programme board - these decisions have been delegated to the programme management team. The logic for this was they are on the project full time and have access to peer professionals in specialist areas. Every decision is seen through the lens of whether it will realise more benefits, or not.
The programme management team is empowered to flex delivery as understanding of the problem and solution improves. They build up knowledge and capacity to respond to both expected and unexpected events. They share objectives with other programmes so learn from their solutions too. Learning from experience happens much earlier in the programme life cycle, and there’s less need to reinvent the wheel.
The delays caused by submitting options to a programme board, and waiting for the next infrequent meeting, are over. The resulting delays and additional costs associated with paying people during dead time, as well as implementing expensive interim solutions that incur a double-handling cost when they have to be dismantled, are over. The programme board can get on with what it does best – setting direction, freeing up obstacles, providing experience, and committing resources (or allocating to other programmes, if that would be best for the achievement of objectives).
How can this happen?
Reports at all levels, from individual SLCs (Site License Companies, the companies licensed to run decommissioning sites on behalf of Nuclear Decommissioning Authority) to Parliament and the Public Accounts Committee, have affirmed the need to focus on objectives and benefits. So why hasn’t it happened?
We believe that project management professionals, decision makers, and the way we establish programmes, are the obstacle. Many senior decision makers worked their way up through civil and nuclear engineering roles. They recognise the need to speak the language of the board, the regulator, the minister, but it doesn’t sit comfortably. In reality, they feel comfortable in the detail of project and programme activities, not consequences.
Project managers want to be measured on things that they can control, like how many cubes of waste they have repackaged. Benefits are outside of their control, because other stakeholders (people, the environment, the finance department) realise benefits, so they don’t like them.
Change is going to require some soul searching. Teams, whether programme management teams or programme boards, are going to have to go through this together, as teams. We’re going to have to be a bit vulnerable, we’re going to need to trust our colleagues, but the benefits make it worthwhile.
What upsides and pitfalls do you see in the vision outlined above? Could the P3M community bring about this change? Will it improve both predictability and investor confidence? What have we missed? What other views do you have?
You may also be interested in:
- Five reasons why the nuclear industry needs to transform how it delivers projects
- What makes nuclear projects unpredictable? The decision-making dilemma
Image: Hugo Minney
This blog was co-written by Hugo Minney and Roger Martin.
Roger Martin is a co-founder of The Mindset Difference, specialists in developing collaborative team cultures in construction and engineering projects that often struggle when process change doesn’t deliver the answers they need.
The recently established Nuclear PM SIG is a collaborative venture between the Nuclear institute and the Association for Project Management, that is aiming to enhance the competitiveness of the nuclear industry and restore confidence amongst public and government stakeholders. It aims to do this by enhancing the capability of project professionals and their organisations by seeking, channelling and sharing innovation and better ways of working.