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Capital Project Mastery

After college, I had my dream job.  As a boy growing up in southern Indiana, I wanted to work at Cummins Engine Company.  Not only was Cummins the largest employer in the area, but it also paid the best and all my friends that had parents working there seemed to have money.  So, I was delighted to have an opportunity to work there as a manufacturing engineer.  I had only been working at Cummins for a week or two when my boss came to me about a new project.  The area I was responsible for had a need for a new wash system and they needed me to handle it.  I was elated about the opportunity at first.  After all, the company was trusting me with a six-figure budget and freedom to make it happen.  There was a problem.  I had no idea where to begin.  There were no classes in college that instructed me on how to manage a capital project.  How do I find potential vendors?  What and who would determine if the project was a success?  What was the internal process for getting the funding approved? How would we select a vendor and what information should I supply them?  I fumbled my way through the project, making many mistakes along the way.  One particular mistake that comes to mind is that upon receiving the system at our facility, we had no place to put it.  I had approved delivery but not prepared the area for the system.  For two days, the system sat on our already crowded dock while we scrambled to drop power and water, plus rearrange equipment to make space.  In the end, we installed the equipment and it did its job, but it was my first exposure to what would end up being a career of working with capital projects.  Over the last 24 years, I have been involved in over 500 capital projects valued at over 200 million dollars.  Just when I think I have seen it all, something else will happen that totally surprises me.  I have learned that managing a capital project is a skill to be learned and developed.  It is a skill that can set an engineer apart from his other peers.  That is why we developed the first course of its kind and certification program for managing capital projects.  We call it Capital Project Mastery.  The course has five modules that teach current or would-be project managers how to execute a capital project at the highest level.  Here is an outline of each module:

Module One

Successful project managers begin with the end in mind.  In this module, we discuss exactly what a capital project is and the justification process for most companies.  We also teach you how to create an outline and executive summary for review with stakeholders.  If there is one thing I have learned, it is the importance of internal management support for the project.  In my experience, no one takes the time to shore up support before embarking on the journey.  This module is all about mapping it out, getting clear on the justification, and ensuring you have management support.  Is the timing and budget adequate for success?  What are the risks?

 

Module Two

In module two, we deep dive into the project specifics, like what is a good part or assembly?  Who will be on the team responsible for factors such as quality, purchasing, operations, program management, etc.?  We will learn how to develop a detailed Request for Quote and lay out the entire project.  If we identified risks in module one, it is here where we develop contingency plans to manage the risks.

Module Three

Selecting the right partners is critical to a successful capital project.  The right partner will not only have the capability to execute the project, but will also be a good cultural fit.  We take the time here to build our ideal partner, essentially building a supplier avatar.  We also overlay the project phases into a timing chart, build out the vendor selection matrix, and create assessment checklists to reduce risk.

Module Four

This module is all about blocking and tackling.  We discuss how to use the tools to maintain a high level of communication internally, and externally.  Engineers that have mastered the management of capital projects know that success is about consistency and communication.  We rely on weekly calls with vendors to manage the open issues list and identify any potential roadblocks.  We use checklists for safety, quality, maintenance, etc. to reduce risk and improve chances of success.

Module Five

We have done the work and now is the time to bring it all together.  The runoff at the vendor and the installation require focused planning to pull off and avoid major issues.  This requires a willingness to hold people accountable.  Compromising during this phase of the project can mean long-term issues.  Never compromise the quality of the finished product to appease the vendor or for timing.  In my 24-year career, I have found this to be the number one mistake project managers make on capital projects.

Successful capital project managers focus on three major components of the project:

  1. Managing the timeline.
  2. Managing the budget.
  3. Managing risk.

If we step back and consider our responsibilities as project managers, it boils down to managing these three.  The Capital Project Mastery program is focused on teaching the fundamentals and providing easy-to-use project management tools. Managing a capital project is a massive undertaking, requiring coordination of internal and external resources.  Executing the projects in a professional, organized method will ensure your company maximum Return on Capital.  Capital Project Mastery is built on over 20 years of experience with some of the largest companies in the world.  The fundamentals covered in the course can not be found in any other training.  It is comprehensive and built on proven fundamentals.  Click here to reserve your spot.

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