Lean Operations for FEL and EPC

Shorten Cycle Time, Eliminate Error, Improve Quality, Reduce Cost

Dr. Robert M. Patty, MBA, PE

Performance Improvement Facilitator / Consultant
832-717-7027 rmpatty@sbcglobal.net

Lean EPC Facilitator

Former KBR Sr. Project Manager

Lean-Constructability Program Manager
& Consultant

Overview
Define lean facility delivery service
including lean construction

Benefits and examples

Business case

Implementation
Getting started

Key take away

Differential success
i.e. benefits using lean

Requires differential sponsorship

by executives

The 20,000 ft View of Lean

Extract & align vision top priorities
Of Client / EPC / Supplier executives

Engage employees
Of Clients / EPC / Supply chain

Extend ultrahigh safety & quality focus

With principles and emergent change tools
To achieve downward spiraling cost & time

Different the way the team works together

To improve performance for Clients
With mutual stakeholder benefit

Traditional vs. Lean Project Delivery

ERA

Design
Basis

Project Proposal

Bid

Traditional Project

Detailed Design
MC

Procurement, Fabrication & Delivery

Lean Project Delivery

System
Criteria

Construction

Component
Detailed Design
Criteria
Construction
Procurement, Fabrication & Delivery
Planning
Construction
WRLP

Project
Criteria

ERA

Start Up

MC

& value improving practices team

OS

Start Up

Assessment of initial impact on pilot projects

Major oil company, senior project managers

OS

Why What Happens

TIC - logistics & operations savings
~4.5% to 15%
used in balance with other VIPs

Raising task completions as planned

from 20 to 80%

Example on Mega PreFEED project

Increased national content 28%

Avoided scope growth 2.5%
Schedule-assurance avoided revenue loss 41%
Saved CAPEX 0.5%
Reduced OPEX 0.5% /year

Core Performance Enhancing Strategies

Enhance
Voice-of-the-customer in decisions
Workface level productivity

Engage an emergent change tool set

Extract & manage by standards
Task-level
Manager-performer aligned

Sequence standards
For flow optimization & reliability

FEL Work Package

Eng. Work Package
Manuf. Work Package
Field Work Package

ITP Q/A Requirements

Safety Requirements
Construction Equipment
Scaffold Builds
Planned Value - Manhours

Timesheet Cost Code

System Designation
Material Status
IFC Drawings
Activity ID & dates
3D snap shots of work

FIWP
Field
Installation
Work
Package

All work
should be planned
in work packages
developed from standards

Leadership Strategies
Transparent-status
Execution control boards
Balanced scorecards

Better fitness for outcomes

Aligned commitment
Task level operational excellence

More robust response to

Near misses
Performance breeches
Creative voices

Management by Lean Work-task-level Standards

Front End Planning Standards
PreFEED- Appraise

EPC Planning Standards

FEED - Select & Define Phase

Detailed Engineer, Procure, Construct Phase

Design
Basis

Project Critical Chain Schedule

4 to 6 Week moving work-task package execution plan
If any standard does not cause
the right things to happen
consistently and reliably
it is not considered lean

It must be improved until it does

the standard itself and/or
the standards deployment policy
workface progress visibility & control

Engineering
Workface Sampling

Urgency Justifies Executive Sponsorship

Alignment of work-process excellence
clients, EPC departments & supply chain

Remove comfort zone

If it doesnt get worse
We will be ok

If it gets worse
We are victims of circumstance, still ok

Executive demand-to-improve
Render traditional cost & schedule
Not-good enough

Figure out how to apply lean here

Results of Workface Sampling

Chemical Plant Construction, Jan 14-24, 2008

Non Contributory, Waiting &
Non Value Added Work
25.2%

Contributory Work 39.0%

Direct Value Added Work

35.8%

Results of Workface Sampling

Chemical Plant Construction, Jan 14-24, 2008

Non Contributory, Waiting &
Non Value Added Work
25.2%

Direct
Value
Added
Work
35.8%

Contributory
Work 39.0%

Effective Setup
13.5%
Dismantle, 1.9%
Fabrication &
PreAssembly, 5.8%
Excavating &
Backfilling, 2.8%
Final Assembly
11.4%
Placing, 0.4%

Results of Workface Sampling

Chemical Plant Construction, Jan 14-24, 2008

Safety Work, 3.8%
Rigging & Flagging, 1.3%
Inspection & Testing; 0.5%

Non Contributory, Waiting &

Non Value Added Work
25.2%

Material and Equipment

Loading, Unloading
& Storage, 1.6%

Contributory
Work 39.0%

Clean Up, 3.2%

Direct
Value Added Work 35.8%

Maintenance & Repair, 1.0%

Personal Time, 1.3%
Move Self, 8.9%
Move Tools & Materials
14.8%
Locating & Positioning 2.2%
Holding Materials or
Equipment, 0.4%

Results of Workface Sampling

Chemical Plant Construction, Jan 14-24, 2008

Contributory Work 39.0%
Non-Contributory,
Non-Value Added Work
& Waiting 25.2%

Idle - Crew Balance; 6.2%

Direct
Value Added Work 35.8%

Idle - Interference; 2.6%

Idle - Talk; 0.4%
Idle - Over Manning; 2.5%
Idle - Late Start or
Early Quit; 3.2%
Idle - Discretionary; 3.2%
Idle - Institutionalized
Standby; 4.2%
Ineffective Work; 1.5%
Rework; 1.5%

Situation-at-a-Glance
LeJeune Bolt

Direct Tension Indicating

Washer

Metallurgy of twist-off end

Limits bolt size
1.125 Diameter max

Frictiondependent tension indication

Dirt or rust
Causes premature twist-off

Cannot be removed once installed

Ergonomic
Non-impact
Single side/operator installation

Operator must stop

to check washer
compression

Inspector
must use feeler gage

Not ergonomic
2 operators
Impact tool required

Implementation
Visual Red Squirt Material
occurs upon advent of Proper Tension

Results
Installer tightens
without stopping

Inspection is Visual
or with feeler gage

Non-impacting wrench
used from one side

No size limits
reduces number of bolts

Friction independent
rust & dirt irrelevant

Is just what installer needs to know

Altered metallurgy
So serrated end does not twist off

Easily removed
and reinstalled if needed

Executive Sponsorship
of Chief Improvement Officer
Differentiation now & future dominance
individuals professionally
project teams & companies

is achievable by real executive commitment

of time, resources
and intellect to learn and implement

Call or send email for primer of new handbook

Patty, Robert M; Denton, Michael A; Lean Operations for Front-endloading, Engineering, Procurement, and Construction: Shorten
Cycle Time, Eliminate Error, Improve Quality, Reduce Cost, UniversalPublishers, 500+ pgs, being typeset for 2009.