Pre-Engineering Saves Money, Improves Accuracy
The trend of “fast tracking” projects now bypasses the time-proven approach of pre-engineering, leading to greater inefficiencies of project execution and higher costs.
Fast track design simply started as a way to quickly execute small capital project work at the end of an annual spending cycle to spend excess money in the remaining annual budget. This year- end-excused bypass of the normal process has since become a more normal execution method due to constrained resources of corporate engineering departments and the need for quicker delivery of enhancements to manufacturing production areas. However, also integrated in the efforts to quickly bring improvements to plant reliability and production are greater inefficiencies of project execution.
The most popular approach to pre-engineering is the phase-gated approach of project front end loading (FEL)-1, 2, and 3, where some engineering is performed and estimates are improved in accuracy through each phase. This is a widely accepted form of determining capital project estimating, execution and spending.
There are several reasons why the pre-engineering or phase-gated project methods are important. The goal of an FEL-1 project is to generate a plus or minus 50 percent estimate, but also to perform some very basic engineering to verify the accuracy level of drawings and equipment installed in the plant. To accurately generate an engineering estimate, the engineer must know the quantities and condition of the drawings for all systems in the plant. Just simply overlooking instrumentation, piping runs or additional machinery that may have been installed or removed since piping and instrumentation diagrams (P&IDs) were last revised will lead to expensive change orders in the detailed design and construction phases of a project.
The next pre-engineering phase, the FEL-2, helps test some of the estimating and assumptions made in the FEL-1 project phase. The goal is to update some of the drawings, gather preliminary estimates, perform walk downs and field studies to reach the plus or minus 30 percent cost accuracy goal. At each gate of the project, the goal is to continue to develop the accuracy of the cost estimate and evaluate the viability of completing the project while validating the return on investment (ROI). At the end of any phase, if the ROI does not compute or the project cost continues to increase to a level that is not feasible, then it is easy for the client to decide to abandon the effort.
During FEL-3 the process is continued by performing a marginal increase in the amount of engineering to further improve the estimate accuracy to plus or minus 10 percent. Also during the FEL-2 and 3 phase, contractors can be brought in to provide information such as construction strategies or automation design architectures and new technologies that may save dollars during the detailed design process. The goal should always be to perform detailed design efforts only once, not multiple times. Any rework after the full team is deployed for detailed design project work will be very expensive. It is much more cost effective to adjust engineering directions during early FEL phases since the project teams are smaller and fewer hours are wasted.
Time is the client’s ally
The practice of starting detailed design without the proper due diligence is a setup for less than acceptable rework consequences. Gathering data in a rush and under duress of extreme time constraints, often symptoms of fast-track projects, leads to poor decision making and a reactive engineering effort. Any time the design team must react to unexpected discoveries in the field leading to change orders, the cost of a project increases.
By executing on a deliberate planned schedule with fewer resources, the accuracy of what needs to be done can be determined leading to an efficient detailed design phase. A result of having a well-executed detailed design project can also be having a better prepared construction effort. Any rework will cascade cost changes down the line in the current and sequential project phases. The goals should always be to engineer once with high quality and accuracy for the most efficient implementation. Being methodical by starting projects with a pre-engineering effort is the best way to obtain these goals.
Matrix Technologies is one of the largest independent process design, industrial automation engineering, and manufacturing operations management companies in North America. To learn more about our manufacturing operations management capabilities and manufacturing process control solutions, contact, Mark O’Connell, PE, Associate Director of Capital Project Planning.
© Matrix Technologies, Inc.
Tags: Mark O'Connell, PE / Capital Project Estimating / FEL / Front-End Loading / Phase-Gated Approach / Pre-Engineering / Pre-Engineering Consulting Services / Project Fast-tracking / Planning
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