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Managing Challenges of Projects Management A Case Study of Oil Industry

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DOI: 10.4324/9781315268422

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Managing Challenges of Projects Management: A Case Study of Oil Industry
Prasanta Kumar Dey, Debashree De, and Vivek Soni

• Risk analysis should be carried out by identifying risk factors in project management
• Detailed project planning covering scope, schedule, budget, quality, human resources,
procurement, communication, and risk should be done before implementation.
• Relationship management across the supply chain (upstream suppliers and downstream
customers) could be the key to success not only during the implementation stage of the
project but also in operations.
• Keeping project plan flexible would be an added advantage to adopt the necessary changes
in projects as they proceed.
• Integrating the decisions in strategic, tactical and operational levels in both project
implementation and operation stages could help achieve desired goals of projects.
• Dynamic evaluation of projects is the absolute necessity to track the project progress and
make quicker decision in order to remain on time and within budget.

Introduction

The success parameters for any project are in time completion, within specific budget and

with requisite performance. The main barriers for their achievement are the changes in the project

environment which includes customers’ demand, political scenarios, technological development,

and suppliers’ businesses. The problem multiples with the size of the project as uncertainties

outcome increase with size of projects. For example large-scale construction projects are exposed

to uncertain environment because of such factors as planning and design complexity, presence of

various interest groups (project owner, owner’s project group, consultants, contractors, vendors

etc.), resources (say materials, equipment, funds etc.), availability, climatic environment, the

economic and political environment and statutory regulations (Dey, 2001). Although risk and

uncertainty affect all projects, size can be a major cause of risk. Other risk factors include the

complexity of the project, the speed of its construction, the location of the project, and its degree

of unfamiliarity. Projects are risky as they are planned with many assumptions.
 In the above context, industrial projects in India are characterized by technical complexity,

environmentally and socially sensitive, capital intensive, involvement of many stakeholders (client,

consultants, contractors, suppliers etc.). Therefore, achievement of projects is never assured. There

are many instances of project failure due to time, cost and quality non-achievement. Projects are

complex to implement with respect to lack of experience in relation to certain design conditions

being exceeded (water depth, ground condition, pipeline size etc.), the influence of external factors

that are beyond human control, external causes which limit resource availability (of techniques and

technology), various environmental impacts, government laws and regulations, and changes in the

economic and political environment. Both factors of cost and time overrun and the unsatisfactory

quality of a project are the general sources of disappointment to the management of organizations.

In such circumstances, a conventional approach to project management is not sufficient, as it does

not enable the project management team to establish an adequate relationship among all phases of

project, to forecast project achievement for building confidence of project team, to make decision

objectively with the help of available database, to provide adequate information for effective

project management and to establish close co-operation among project team members.

Project failures have been focused in the literature from government (Damoah & Akwei,

2017) and engineering sector perspective. The reason for failure has been investigated from the

project and stakeholders’ perspective(Sutterfield et. al, 2006). The strategies are designed to avoid

failures, maximize the success(Kealey et. al, 2006) and suggest some solution to the project

management failures(Anderson & Merna, 2003). Projects in India suffer from accurate prediction

of demand that calls for augmentation of facilities soon after completion of project. Such challenges

includes design optimization with the consideration all technical, economical as well as

environmental factors throughout the project life, poor performance of contractors, suppliers, lack

of managing ability of client and consultants. The foreign investment projects in India are more
complex as along with the project variables as stated above, cultural differences play a major role.

These projects also suffer from issues related to supply chain integration, relationship management,

project planning, dealing with economical and political challenges, environmental regulation, and

social needs. Critical concern in Indian project management are: inaccurate assessment of project

risks, lack of management to manage projects complexity, inability to correctly estimate and

monitor ineffective utilisation of best practices and benchmark difficulty to involve multiple and

diverse stakeholders and inability to synchronize project plan and evaluation (FICCI, 2012).

Therefore, an effective project management method is the need of the hour to implement and to

optimize investment on project, specifically those are foreign funded in the Indian oil and gas

sector. Therefore, the main objective of this chapter is to analyze project management maturity of

an organization in the Indian oil industry and suggest improvement measures so as to depict issues

and challenges of managing projects in India and means for achieving success. Section two

elaborates the methodology. Section three demonstrates causes of project failure as reported in the

literature. Section four illustrates few examples of issues and challenges of project management of

the organization under study and provides root cause analysis of non-achievement. Section five

derives project management maturity of the organization under study. Section six suggests

improvement measures and section seven discusses dos and don’ts of managing projects in India

and concludes the study.

Methodology

This analysis is based on critical review of literature on causes of project failure in general along

with the risk factors for achieving project success in Indian oil industry in particular. An

organization in the Indian oil industry has been identified to highlight project management
maturity. Further, a few examples have been captured from the organization under study on project

failure using informal discussions with relevant people followed by root cause analysis.

Subsequently, a questionnaire survey quantitatively captures the perceptions of the project

executives of the organization under study. Moreover a review of project documents and informal

interviews with the project executives validates the findings from this exercise. Lastly, a

benchmarking exercise determines the relative project management performance of the

participating organizations, which identifies the improvement measures and their priorities for the

organization under study. The following paragraph introduces the organization.

Born from the vision of achieving self-reliance in oil refining and marketing for the nation,

the organization under study has gathered a luminous legacy of more than 100 years of accumulated

experiences in all areas of petroleum refining from 1901. At present, it controls 10 of India’s 20

refineries with total refining capacity of 60.2 million metric tonnes per annum (MMTPA) or 1.2

million barrels per day -the largest share among refining companies in India. It accounts for 33.8%

share of national refining capacity. It operates more than 10,000 Km of pipeline network (69.60

MMTPA) across the country. It has one of the largest petroleum marketing and distribution

networks in Asia, with over 34,000 marketing touch points. It’s world class R&D Centre,

established in 1972, has state of the art facilities and has delivered pioneering results in lubricants

technology, refining process, pipeline transportation, bio-fuels and fuel-efficient appliances.

Causes of project failure

Both academics and industry based practitioners extensively research causes of project

failure. They have derived many risk events that might cause negative impact on projects (Songer

et al. 1997; Tammala and Leung, 1999; Dey and Ogunlana, 2001; Belout and Gauvreau, 2004; Dey

et al. 2009, Dey and Kinch, 2008; Dey, 2010; Dey, 2012; Dey et al. 2013). There are instances of
project failure due to operational risks, such as technical complexities, contractors’ and suppliers’

incapability, government red tape etc., which remain unidentified till they occur. Dey et al. (1994)

and Dey (2001) reported cost and time overrun respectively due to implementation issues of cross-

country oil pipelines in India.

In a series of interesting empirical studies covering twenty countries across the five

continents, Flyvbjerg, Holm and Buhl (2002, 2003, and 2004) have shown that infrastructure

projects often suffer from cost. Merewitz (1973), Kain (1990), Pickrell (1990), Skamris and

Flyvbjerg (1997), among others, have also come out with similar findings. Ogunlana et al. (1996)

reported costs overrun in high-rise building projects in Thailand due to contractor’s failure. Social

and environmental issues caused prolonged postponement of Chand-Cameroon oil pipelines

(Ndumbe, 2002). Several projects in Vietnam oil industry were delayed due to government

approval (Thuyet et al., 2007). A thorough review of such researches reveals a few generic risk

events. These are valid for the Indian context as well as foreign companies investing in India. Table

1 shows risk events across phases (planning, implementation and evaluation) and risk categories

(project management processes, organizational transformation, and technology management).

Table 9: Risk Events in Project Management

Project phases Risk Categories

Project management Organizational Technology

processes transformation management
Inaccurate business Lack of In appropriate
case. management/executive technology selection.
Unclear objectives. commitments and Sub-optimal design.
Weak implementation leadership. Lack of
Planning team. Lack of synergy communication with
Inappropriate supplier, between technology the end users.
contractor and strategy and Inadequate training
consultant selection. organizational plan for the users.
competitive strategy.
Unclear change

strategy.
 Inappropriate Inappropriate change Business process
management of scope. management. reengineering
Lack of Inappropriate incompetence for use
communication management of culture of new technology.
between and structure. Inappropriate system
implementation team, integration.
designers, supplier, Inaccurate
Implementation contractor and performance data.
consultant. Inappropriate users
Poor contract training.
management.
Not meeting statutory
requirements (e.g.
environment and safety
etc.).
Inappropriate contract Inadequate Inappropriate system
closeout. organizational testing and
Inappropriate readiness. commissioning.
Hand-over, disbanding of team. Resistance to change. Lack of clarity on
Lack of knowledge Lack of user training. inspection and
evaluation and management. maintenance.
operations Inaccurate
performance
measurement and
management
framework.

Occurrence of any one of the above events may cause failure of projects to achieve time,

cost and quality targets. The following examples show causes of project failure in the Indian oil

industry.

Examples: Project management challenges and issues: Case of Indian oil industry

The following incidents demonstrate the project management problems experienced by the

oil pipeline operators of the organization under study while managing oil refinery and related

construction projects. In 1995, a 60 km long pipeline (diameter 12 inches) was planned for

replacing transportation mode of crude oil and petroleum products via vessels in the eastern part

of India. The project duration was 18 months. The project consisted of laying pipe across river
Ganges (river width 2 km at the point of crossing) along with other work packages (laying main

line pipes, station construction, cathodic protection, and telecommunication). The river crossing

work package was planned to be executed by a turnkey contractor to be selected through the global

tendering method. As the owner had previous experience of laying pipe across rivers/ canals (width

max. 1 km) using Horizontal Direction Drilling through turnkey contractors, no study was made

neither during feasibility analysis nor during planning phase to check whether laying pipe across

river of 2 km is technically feasible or not through some experienced turnkey contractors. From

previous experience, the bid document was prepared for engaging a turnkey contractor for laying

pipe across the river and floated for receiving offers globally. However, no offer was received

within the due dates and subsequent checking up with the prospective contractors revealed that

they didn’t have experience in laying pipe across river of width 2 km. The case was referred to a

global consultant for identifying suitable contractor for the project. They reported that there were

only two contractors having experience of laying pipe across river of 1.8 km width. They

recommended selecting one of them and checking up with them the applicability of using their

technology for laying pipe across 2-km wide river. However, they cautioned that the owner had to

take the risk of failure. Alternately, they suggested constructing a bridge across the river and laying

pipe along the piers of the bridge. This option was not suitable to the owner, as constructing bridge

across the river does not come under scope of their business, which will cause huge extra

expenditure. The owner decided to abandon the project in its current form and decided to look into

the alternative techno-economic feasible solutions. The project had been commissioned in 1999

with laying branch pipeline from an existing pipeline by suitably augmenting the capacity of the

existing pipeline through river crossing at the upstream where the river width is within the limit of

available experienced contractors for laying pipe across river.

 The above issues highlight the pitfalls of project management practices of the organization

understudy. The technical feasibility analysis was poor as implementation methodology selection

and procurement plans were not developed through a thorough analysis. They were mainly

experience based. Project management practices are more reactive than proactive as crisis

management approach was adopted in order to resolve the issues.

Another pipeline in northwest part of India had been commissioned in 1996 with huge cost

escalation (more than 125%) from the original estimate due to devaluation of Indian currency

during the project duration, changing contract type (unit contract to turnkey contract), distance

management with main international turnkey contractor, and many design alterations midway.

Although the project was completed on schedule, the dispute between owner and the main

contractor in connection to extra claims reached to such an extent that they went for arbitration.

The hearings are reported to be still continuing. This shows the incapability of managing scope of

this project along with managing relationship with the contractors.

Another example includes that of an oil refinery project in central of India, which was

commissioned in 2002 with substantial time overrun because of delayed delivery of a few vertical

turbine pumps by a supplier in the Indian public sector. The bid for supplying the pumping units

was awarded to them on competitive basis with the consideration of past performance including

delivery schedule. Although the financial performance of the company was deteriorating from past

few years, this was ignored while evaluating their offer. During the manufacturing of the referred

order, the management of the supplier decided to reduce the production capacity so as to minimize

the loss. This caused disruption of delivery schedule of all of their orders including the vertical

turbine pumps under consideration. However, the project owner could not anticipate the delayed

delivery until the due date reached, as they didn’t establish many follow-ups with the supplier.

Later, they improved the follow-up with the supplier and got the delivery of the pumping units after
five months of scheduled delivery. This caused the overall delay in completing the project by more

than a year.

This shows that procurement management is one of the important issues of managing

projects in India. The organization under study lacks procurement planning for all project materials

and implementation activities. A strong synergy between design and detailed engineering and

procurement planning needs to adopt in order to strengthen project management practices. Recently

(2007) an oil refinery (7.5 MMTPA) at the Eastern part of India was commissioned with offshore

crude oil receiving facility in the Bay-of-Bengal using Single Buoy Mooring (SBM). The project

was delayed by two and half years mainly because of not able to complete the implementation of

SBM on time. This had a cascading effect on other work packages such as laying of offshore

pipeline and related hydro testing. The work package of implementing SBM was initially entrusted

to an Iranian turnkey contractor on the basis of competitive bidding. The Iranian contractor couldn’t

complete this work package within stipulated time period and additionally, there were many quality

issues. Their contract was terminated before completion by the client after many negotiation

meetings failed. Subsequently, the SBM was commissioned by another turnkey contractor with

substantial cost overrun. Moreover, the offshore pipeline observed many failures during its

operations, which affected refinery operations substantially. This demonstrates lack of project

planning ability, which includes technical feasibility analysis and risk analysis. More proactive

approach is needed in order to project management effectively in the Indian context. All the above

examples show clear evidences of lack of appropriate project management practices of the

organization under study.

The root causes of project non-achievement

The root causes for project failure at the organization was analyzed with the involvement of a few

relevant project executives through informal discussions, which revealed that project non-

achievement in the Indian oil industry is due to mainly two reasons – sub-optimal design and poor

project management (Kerzner, 2013). Inappropriate site selection, technology selection and

implementation methodology selection are attributed for sub-optimal design. Improper project

planning (scoping, scheduling, budgeting and specification), inefficient project organization, and

ineffective supply chain management are the causes of poor project management. The broader

picture of root causes in project failure have been depicted in the figure 1.

The logical framework for reduction in project failure

Literature published indicates that there is a scope of improvement in the reduction of project

failure in Indian oil industry. A logical framework can be used to understand an issue in the

hierarchical approach. One hierarchy turns to be the objective for next hierarchy calculation of

solution in the Quality Deployment Function (Baccarini, 1999). A logical framework has being

developed in Table 2 to reduce project failures. The purpose, output and activities are derived from

the critical literature review. The detailed demonstration of logical framework is available

elsewhere (see Dey et al. 2007; Buttigieg, et al. 2016).

Table 2: Logical Framework for Reduction in Project Failure

Narrative Verifiable indicators Means of verification Important

summary assumptions
Goal Reduction in project failure Time, Budget, Risk
Purpose 1)sub optimal design and detailed 1)Project failures due to design and Delay in
engineering engineering decisions project
2)ineffective project management 2)Issues in project due to project management delivery,
efficiency increase in
project cause
and risk
Outputs 1.1) Wrong site selection 1)Site chosen is infeasible for the project failure in
1.2) Ineffective technology selection 2)technology is not compatible with the project
1.3) Ineffective implementation project requirements
methodology section 3)issues occurring due to problems in
1.4) Poor planning implementation strategies
1.5) Weak project organization 4)project face challenges in planning and
1.6) Ineffective supply chain execution
management 5)issues in project scope, cost and time
6) issues due to lack of coordination between
supplier and organisation
Activities 1.1) Ability to make current decision on Get the key decision makers on search There is
site selection parameters, ensure the necessities of the scope of
requirement related to the sites improvement
1.2) Ability to make technology selection Deciding the compatibility of the technology and a
with the project similarity in
1.3) Project integration management Continuous improvement of project between
management process, customizing project project
1.4) Project risk management Developing integrated risk management
Poor communication management framework, training the project personnel to
practise
Developing an integrated planning,
monitoring and controlling framework
1.5) Project human resource management Developing project governance structure for
Project time management each project with clear roles responsibilities of
Project cost management each stakeholders. Objective selection of
Project quality management project people and assigning them
responsibilities
Customised project management with training
Developing robust quality management plan
for each project by linking material
specification and activity specifications
1.6)project procurement management Developing procurement portfolio for each
project
Project management maturity of the organization

Project management maturity of the organization under study was carried out using the protocol as

shown in Figure 2. The project management maturity self-assessment questionnaire (Grant and

Pennypacker, 2006) utilised in Stage One. The questionnaire is based on the Project Management

Institute’s (PMI) nine Project Management Knowledge areas (PMI, 2004).

Source: (Grant and Pennypacker, 2006)

The purpose of this study is to analyze the project management maturity of the organization under

study and to provide recommendations in order to achieve “World Class Capital Project Delivery”.

The below overview depicts the following:

• Feedback on the Project Management Maturity Questionnaire from Stage One.

• Feedback on the follow-up interviews and documentary analysis conducted in Stage Two.

• New practices and knowledge transfer opportunities identified by Stage Three.

Stage One – Quantitative Analysis

The self-assessment questionnaire contains nine subject areas and an ‘overview’, with each

subject area containing multiple questions. Each question is rated from Level 1 (lowest rating)

through to Level 5 (highest rating). The nine subject areas consisted of Project Integration

Management, Project Scope Management, Project Time Management, Project Cost Management,

Project Quality Management, Project Human Resource Management, Project Communications

Management, Project Risk Management, and Project Procurement Management. Six senior staff

were invited to participate in the self-assessment questionnaire from all functions of the business

involved in Capital Project Delivery. This was a sufficiently representative cross section of the

organization’s business. The average maturity levels against each knowledge area are shown in

table 3.

Table 3: Project Management Maturity Level of the Organization Under Study

Project management Average maturity Prioritized problem areas

knowledge areas level

Project Integration 2.13 Absence of customized project

Management management processes, Change control

Project Scope Management 2.06 Change control

Project Time Management 1.97 Schedule control

Project Cost Management 1.53 Cost control

Project Quality Management 2.50 Suppliers’ and contractors’ quality

improvement

Project Human Resource 2.00 Organization planning and team

Management development
 Project Communications 1.88 Performance reporting and issues
Management Tracking and Management

Project Risk Management 1.63 All sub-areas need attention

Project Procurement 2.29 Stakeholders selection on the basis of

Management quality

Table 3 reveals that the organization under study has gross average maturity very close to

the factor of 2. Project quality management and project procurement are relatively strong areas,

whereas project cost management and project risk management are the weakest areas. Overall the

organization lacks in managing project risks, controlling scope, time and cost, and organization

planning and team development.

Stage Two – Interview Outcomes

Two project executives were interviewed (semi-structured) together to understand project

management maturity of the organization. The discussion was limited within the nine knowledge

areas of project management body of knowledge. Along with the discussion, various project

management documents were reviewed. There was no major disagreement on organization’s

project management practices or and maturity as revealed in the questionnaire survey. Both of

them agreed on the following points with respect to each knowledge area:

Integration management

Although the organization under study has ISO 9000 certification, project management

practices are experienced based. There are project plans (business case, activity network, budget,

specification, design and drawings etc.), but there is no customized documented project

management processes for each strategic project. Project planning and implementation are
managed through individual project management skill using meetings and other communication

methods.

Project changes are not formally documented if these do not have time and cost

implications. Project changes that have time and cost implications are hierarchically approved

through organization’s governance. There is project management office (PMO), which is manned

by experienced persons with functional (mechanical, electrical, civil, telecommunication, human

resource management, finance and information) expertise. Each project forms matrix organization

to manage projects. Formal contract closings are done for all the projects. However, there is no

formal project evaluation report covering lesson learned.

Key takeaway: Develop a project management office and establish a standardized project

management practices across various phases of project. Customize the standard project

management practices as per requirement.

Scope management

Project scope is developed from the business case with the involvement of the concerned

stakeholders. There is no protocol for project scope change control. Currently, project review

meetings address the issues of scope management. Anything beyond the control of project manager

goes to organizational hierarchy to address. There is no formal procedure.

Key takeaway: There should be a scope management plan in place, which will enable the project

management team to make decision on scope change quickly.

Time management

Project activities are evolved from project scope (work breakdown structure). Activity

duration estimation is deterministic and mainly based on planners’ past experience. Suppliers and
contractors are also involved in many cases for providing valued information on activity durations.

Therefore, development of accurate project schedule is an issue. Activity network is developed

using MS Project. However, the major challenge in time management is schedule control.

Key takeaway: A realistic schedule development for every project activity is the key. Schedule

implication of any scope change decision should be appropriately evaluated.

Cost management

The business case for specific project indicates the resource requirements and forms the

basis for cost estimate. There is no cost database. Both past data and supplier budgetary quotations

help develop project cost estimate. The cost estimates are not liked with activity network in MS

project. Project budget is controlled by the finance department and produce report on a regular

basis. There is no earned value management practice in the organization. Cost control is one of the

major issues in the organization’s project management. Both time and cost management are directly

related scope management. An integrated approach to change management is absent in the current

project management practice.

Key takeaway: Appropriate contingency planning is vital for the project. Cost and schedule control

along with scope management helps achieve success.

Quality management

Specification for every project is incorporated in the business case. Depending on the type

of project, detailed specifications are developed by the concerned stakeholders (e.g. suppliers,

designers, contractors etc.) and approved by the project manager or appropriate competent

authority in the organizational hierarchy. Inspections are carried out as planned either on-site or

supplier premises. However, there is no standardized process for managing project quality.
Involving quality suppliers and contractors is the major issue as contemporary approach to supplier

and contractor selection is governed by least cost criteria.

Key takeaway: Developing quality plan for each project activity and material, selection of quality

suppliers and contractors, and monitoring of quality / specifications of every project activity help

achieve desired project quality and ultimate customer satisfaction.

Human resource management

There is no formal process for project organizational planning, forming responsibility

matrix and team development activities. However, project specific organization breakdown

structure is developed. There is no formal project personnel selection and work package

authorization process in place. Although the project personnel are technically / functionally

qualified, they may not have project management experience. In many projects, basic project

management skill gaps are quite visible.

Key takeaway: Identifying appropriate project manager and right personnel and fostering project

management culture across the project supply chain would be critical for the organizational

leadership in order to achieve success.

Communication management

Although there are a few report formats mainly to monitor and control project progress, the

communication across project stakeholders is mostly informal. Although information technology

based communication systems (MS project, MS office, email etc.) exist, there is no formal protocol

for inter and intra organization communication. The minutes of project review meeting work as

authentic documents for project control.

Key takeaway: Identifying appropriate project stakeholders, understanding their requirements

from the project and making the right information available in right time will not only help making

right decision on time, but also keep the project affected people aware on progress.

Risk management

Risk management culture exits within the organization. In fact many projects are initiated

to mitigate business and technical risks. However, there is no formal risk management practice

(e.g. logging risks using risk register, planning, monitoring and controlling risks) in managing

projects. However informal risk identification and analysis are carried out and suitable mitigating

measures are suggested mainly using past experience. Project management approach is more

reactive than proactive.

Key takeaway: As foreign investment project is always risky, the overall project plan must consider

risks that are involved in the project. Identifying them at the early stage of the project, analyzing

their impact and developing responses to mitigate are the key to success of many foreign projects.

Procurement management

Project procurement planning is undertaken in the early stage of project along with activity

planning. Normal tendering processes are adopted to engage suppliers and contractors. Major

suppliers and contractors are selected on the basis of their technical attributes along with price

offer. There is no long term relationship among the project stakeholders (suppliers and contractors).

Key takeaway: Long term partnership, relationship development, selecting suppliers / contractors

on the basis of total cost ownership will certainly be an added advantage to manage projects in

India.
 It has been observed from the stakeholder interviews that the overall project management

maturity of the organization under study is medium to low. Although projects are planned /

scheduled using leading project management software, monitored and controlled through number

of project review meetings throughout the project phase, they lack effective project management

approaches. The interviewees agreed that standardized project management processes with project

specific customization will help practice better project management throughout the organization.

Stage Three – Benchmarking

Project management practices of the organization understudy was benchmarked against six

other organizations in various industries (e.g., manufacturing, services, retail etc.) across the World

and the results of the Project Maturity self-assessments of all the participating organizations are

summarised in Figure 3.

Figure 3 Comparative Project Management Maturity Levels

 Figure 3 shows the level of maturity of project management practices of the organization

under study in the nine Project Management Knowledge Areas as compared to other participating

organizations. This demonstrates that the concerned organization has low level of maturity in all

nine areas compared to the participating organization. Therefore, there is room for improvements

across the project management knowledge areas.

Improvement measures

On the basis of the PMM analysis (self assessment questionnaire survey, focused interview

and benchmarking) the following recommendations are made. Table 4 shows the suggested

improvement measures along with the relevant project management references for the best

practices.

Table 4: Recommendation for Improving Project Management Practices

Knowledge areas Problem areas Recommendations Relevant best

practices theories

Project Integration Absence of Fostering project Dai and Wells (2004);

Management customized management culture across Dey, P K (1999); Dey,
project the organization, developing P K (2006); Ibbs,
management project governance structure Wong, and
processes, for each project, continuous Kwak,(2001),
Change control improvement of standard
project management
processes, customizing
project management
processes for each strategic
project, organizing relevant
project management training,
managing project portfolio
across the organization
Project Scope Change control Practicing customized project Ibbs, Wong, and
Management management through Kwak,(2001),
appropriate training

Project Time Schedule control Practicing customized project Ibbs, Wong, and
Management management through Kwak,(2001),
appropriate training

Project Cost Cost control Practicing customized project Ibbs, Wong, and
Management management through Kwak,(2001),
appropriate training

Project Quality Standardized Developing a robust quality Arditi and Gunaydin,

Management processes for management plan for each (1997),
project quality project by linking material Winch; Usmani
management is specifications and activity and Edkins, (1998),
absent specifications

Project Human Organization Developing project Belout, and

Resource planning and governance structure for each Gauvreau, (2004);
Management team project with clear roles and Bubshail, and Farooq,
development responsibility of each (1999); Loo, R.
stakeholder, Objective (2000);
selection of project people
and assigning responsibilities

Project Performance Developing an integrated Charoenngam et al.

Communications reporting and planning, monitoring and (2004)
Management issues Tracking controlling framework with
and Management clear links with the concerned
stakeholders

Project Risk All sub-areas Developing an integrated Dey, P K (2002); Raz,

Management need attention project risk management and Michael, (2001);
framework, training the
project personnel to practice
it
 Project Supplier and Developing procurement Vrijhoef, and
Procurement contractor portfolio for each project, Koskela, (2000); Dey
Management relationship establishing desired et al. (2008)
management relationship with all the
stakeholders

Discussion and Key Issues

This chapter focused on a selected Indian case study of oil and gas project and contributes

a method to analyze project management maturity of any organization using triangulation

approach. The case study aimed to capture real life project experiences, questionnaire survey to

statistically observe project management maturity, personal interview and also the project

document reviews to validate the maturity. The proposed method highlights five steps. They are as

follows:

Step 1: Developing an examples of issues and challenges of project management practices of the

organization and analyzing their root causes

Step 2: Pursuing questionnaire survey among the key executives of the organization under study,

which is followed by statistical computation of their responses

Step 3: Interviewing a few selected senior project executives informally in order to capture their

perceptions on project management maturity and to validate the outcomes of the earlier step

Step 4: Benchmarking project management maturity of the organization with other organizations

Step 5: Suggesting improvement measures

The proposed method helps measure absolute project management performance of any

organization and as well as benchmark performance with other organizations. The study further

reveals that the organization under study suffers from low project management maturity. The
project management practices suffer from both design optimization and effective project

management. Study argues that the organization under study needs improvement in project site

selection, technology selection, implementation methodology selection, project planning,

organizing and managing project supply chain.

The study recommends that the organization under study could improve project

management by fostering project management culture across the organization, developing project

governance structure for each project, continuous improvement of standard project management

processes, customizing project management processes for each strategic project, organizing

relevant project management training, and managing project portfolio across the organization.

Additionally, practicing customized project management through appropriate training, developing

a robust quality management plan for each project by linking material specifications and activity

specifications, developing project governance structure for each project with clear roles and

responsibility of each stakeholder, objective selection of project people and assigning

responsibilities, developing an integrated planning, monitoring and controlling framework with

clear links with the concerned stakeholders, developing an integrated project risk management

framework, training the project personnel to practice it and developing procurement portfolio for

each project, and establishing desired relationship with all the stakeholders.

Through the case study, this analysis demonstrates issues and challenges of managing

projects in India. The authors suggest that organizations planning major projects in India must

analyze their project management maturity using the proposed project management maturity model

and improve their performance. Additionally, they must emphasize on the followings in order to

get success in implementing and operating major projects in India.

• Detailed project feasibility analysis covering market, technical, financial, environmental

and social needs to be carried out before investment decision. Moreover, the best project
 alternatives in terms of technology, market etc. is to be analyzed using multiple criteria

such as complexity, flexibility, adaptability, return on investment, cost, environment

friendliness, and employability.

• Risk analysis should be carried out by identifying risk factors, analyzing their effect

(probability and impact) and developing risk responses in order to justify the investment.

• Detailed project planning covering scope, schedule, budget, quality, human resources,

procurement, communication, and risk should be done before implementation. Project

organizing and procurement must be emphasized in overall planning. Appropriate

leadership, project governance and communication across the project stakeholders need

proper attention.

• Relationship management across the supply chain (upstream suppliers and downstream

customers) could be the key to success not only during the implementation stage of the

project but also in operations.

• Keeping project plan flexible would be an added advantage to adopt the necessary changes

in projects as they proceed. There should be a scope management plan in place.

• Integrating the decisions in strategic, tactical and operational levels in both project

implementation and operation stages could help achieve desired goals of projects.

• Dynamic evaluation of projects is the absolute necessity to track the project progress and

make quicker decision in order to remain on time and within budget.

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