Phase IV Project
Risk Analysis: FMF Cape Breton Shop Consolidation
Client: Defence Construction Canada, Department
of National Defence
ENGCOMP was contracted by Defence Construction
Canada (DCC) to assist the Department of National Defence (DND)
in defining the budget for Phase IV of the Fleet Maintenance Facility
Cape Breton (FMF (CB)) Shop Consolidation Project (Project 4360).
The study was to be executed in 4 parts: Project Evaluation, Contingency
Analysis, Project Risk Analysis and Project Documentation.
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The FMF (CB) Project has been ongoing for more
than 10 years and is currently in the fourth phase of execution.
On any project there is always room for improvement. Documenting
lessons learned from the past provides opportunity to make improvements
for future projects. ENGCOMP provided a review of project issues
to date and offered recommendations on key areas of improvement
for increasing the likelihood of future project success.
The primary reason for ENGCOMP's involvement,
however, was to conduct Monte Carlo simulations on the project
in order to quantify uncertainty in defining the budget and schedule.
ENGCOMP has developed a system that breaks this into two simulations
– Contingency Analysis and Project Risk Analysis. The outcomes
of these analyses are quantification of Cost Contingency, Risk
Reserve and Schedule Contingency.
Through ENGCOMP's facilitation process, valuable
information contained within a dynamic group of subject matter
experts was gathered. These stakeholders have much experience
in their respective areas of expertise both on and off the FMF
Cape Breton project. Utilizing the gathered information in a productive
way provided a deliverable which will help DND to deliver their
project on budget and on time.
- Project Location: Canadian Forces Base Esquimalt,
in Victoria BC
- The goal is to consolidate and upgrade the
Fleet Maintenance Facilities, which are currently smaller facilities
spread all over the base, into one large facility incorporating
lean manufacturing concepts.
- The project currently sits in the middle
of Phase IV execution. DND requested evaluation of the remaining
budget and schedule required to complete this phase.
- Although there have been risk assessments
completed on the project in the past, a true risk analysis using
Monte Carlo simulation has yet to be completed.
- Part 1 - Project Evaluation: Information
gathering mission where ENGCOMP gathered project documents,
toured the facilities, learned about FMF operations and interviewed
major stakeholder groups for the project. The deliverable included
recommendations on improvements to project operations and policies.
- Part 2 - Contingency Analysis: Site
meetings included estimate review, team calibration and variability
brainstorming. Custom reports based on the Monte Carlo simulation
were prepared to suit the specific requirements of DND. The
outcome of this analysis was the required project Contingency
including evaluation of Escalation.
- Part 3 - Action Plan: ENGCOMP provided
Facilitated Project Planning Services to prepare an appropriate
schedule and action plan for the rest of Phase IV.
- Part 4 - Project Risk Analysis: Site
meetings with the planning team included schedule variability
brainstorming and risk register brainstorming. This combined
with the Contingency Analysis provided the input data required
for generating the model. The outcome of this analysis was the
project Risk Reserve and Schedule Contingency. The results also
provided the basis for the project Cash Flow which ENGCOMP prepared.
- Part 5 - Project Documentation: The
documentation included risk analysis methodology and sufficient
instruction such that the approach can be applied to other DND
projects. ENGCOMP also provided input into the preparation of
an updated Project Profile Risk Assessment report.
- First Meeting in Ottawa November 2007, Project
Kick-off January 2008, Project Complete June 2008
- DND is very satisfied with the deliverables
- Met with the Senior Review Board at National
Defence Headquarters (NDHQ) in Ottawa to deliver the results
with the Project Manager
- Met with the DND Financial Analyst at NDHQ
to deliver the results with the DND Project Manager
- Working with DND to prepare a policy on
performing this type of project risk analysis for all future
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