A manufacturing plant was a few months away from a $110 million capital project startup when it discovered there was insufficient product storage capacity for their major expansion. This would have bottlenecked production resulting in lost productivity and revenue.

How can you be prepared for startup? Begin the process early to ensure operational readiness with a Site Readiness Assessment (SRA).

 

Ensuring Operational Readiness is the 8th stage in the Asset Life Cycle, completed by effectively utilizing the Site Readiness Assessment (SRA) tool. Tasks associated with preparing for the SRA should begin as early as Stage 4 (Design and Engineer) and should continue until the site is fully prepared for the upcoming change. Completion of tasks/items generated from the SRA may extend as far upstream of Stage 9 (Commissioning and Startup) to provide the site team with confidence that they possess The Technical Right To Succeed in operating new assets and processes. This same logic applies to turnarounds focused primarily upon Maintenance & Repair tasks because change can occur from any tasks that intervene upon normal asset operation.

 

What is a Site Readiness Assessment?

An SRA, also known as an Operational Readiness Assessment, is a disciplined, structured, documented tool that is used to objectively assess and verify all stakeholder groups are properly prepared to ensure the safe, compliant, high-quality, on-time, and on-budget performance of a major project or major turnaround (also referred to as an outage). Any event that creates, or has the potential to create significant change in the performance of a site will benefit from a professionally executed SRA.

An SRA is a structured, documented assessment consisting of 900 +/- questions, tailored for the specific site and project. Questions are separated by subject area, normally by site department.

Issues identified and corrected thanks to a disciplined SRA include a lack of a Bills of Materials in the Computerized Maintenance Management System (CMMS), missing or insufficient training for operators, maintenance mechanics, quality testers, and other plant personnel, missing Material Safety Data information, and lack of new maintenance procedures or tools identified for new equipment.

An SRA can mitigate risk by ensuring all departments and functions are aligned with the requirements for a successful outcome and can maximize return on investment by adhering to the schedule and budget.

 

Stakeholder Groups

It is important for all stakeholder groups to be represented during an SRA. Stakeholder groups with input into the success or failure of a major project or turnaround include the following:

 

• Environmental compliance – new materials, wastes, regulations, monitoring, treatment processes
• Industrial Hygiene (safety) – new equipment with new hazards
• Plant Security – security, traffic, weighing, record keeping, hazardous materials, etc.
• Manufacturing – new or changed products, new training requirements
• Maintenance – new equipment, spare parts, maintenance techniques, inspection requirements
• Logistics – inbound and outbound shipment volumes, modes, and schedules
• Supply Chain – new suppliers, new materials, etc.
• Quality – new specifications, new customers, new testing methods
• Accounting & Finance – new accounts, new materials, changed prices, reporting changes
• Procurement – new materials, parts, tools, suppliers, contracts, foreign currency requirements
• Information Technology – new IT systems, network demands, data storage/reporting
• Human Resources – new people, new schedules, new roles, new labor rates, etc.
• Sales & Marketing – effects on inventory management and customer shipments
• Plant Employees – are they informed, trained, equipped, and prepared for the change?
• Plant Suppliers – are they given sufficient information to help with the change?

Conducting an SRA

Traditionally, two SRAs are performed: a “Baseline Assessment” and a “Final Assessment.” The agenda and methodology for both Baseline and Final Assessments are nearly identical.

Baseline Assessment
The Baseline Assessment should be performed 12-18 months prior to the major event (i.e. the startup of a major capital project or turnaround). The Assessment Team prepares the assessment questions, schedules times and locations to meet with the site’s subject matter experts and department leaders and visits the site for a period of 2-5 days, depending upon the size and complexity of the project/turnaround and the size of the assessment team.

The SRA team first conducts a series of interviews with subject matter experts in a small group setting. This is called “the conference room assessment.” Answers to questions from each subject area (stakeholder group) are documented in as much detail as possible. There may be unknowns during the Baseline Assessment, but these are important and documented.

When the initial interviews are completed, the SRA team goes into the field to complete the Field Verification phase of the assessment. Objective evidence from the field is documented alongside answers that were provided in the conference room interviews. Any gaps between “reported” and “field verified” information are documented to keep the entire team aligned and data-driven.

After documenting “as answered” and “as verified” conditions to 900 +/- questions, the SRA team compiles a detailed report showing the status of every question. Each question is part of a designated subject area or stakeholder group, so the report shows the current level of readiness of every stakeholder group. This data is provided in detail to help the team understand the current readiness level of every group.

The Baseline SRA is used to prioritize which identified gaps will be closed, who will be responsible for closing each item, and by when this will be completed. These decisions are documented via the Rolling Action Items List (RAIL).

Routine RAIL Update meetings should be conducted, documented, and communicated at least monthly during the 12-18 months that are available between the Baseline Assessment and the major event. If prioritized gaps are not being closed every month, Site Readiness is not being effectively managed.

Final Assessment
A Final Assessment, following the same methodology as the Baseline Assessment, is performed 2-3 months prior to the major event. Ideally, all previously prioritized and managed gaps are verified to be sustainably closed. If not, these gaps will be identified and highlighted to all stakeholders so action can be taken prior to the major event.
The Final Assessment also helps identify any new gaps that arose between the Baseline and Final Assessments. This is normal, especially for large, complex projects or turnarounds. As scope, schedule, and cost evolves, new gaps (sources of unreadiness) arise.

Working with an Experienced Team

Tormod’s Teammates conduct SRAs across multiple industries and bring best practices for the benefit of our clients. To learn more about how an SRA can help your project, turnaround, or major change initiative, contact us today.

 

If your facility was designed with a check valve 15 feet off the ground, or with a pressure relief valve without a bypass loop, it could cost you downtime and lost production – not to mention safety concerns for your personnel and community.

Poor planning at the beginning of the design of a facility can result in excessive changes to the design during the construction phase and delays to the commissioning & startup phase. This can occur with a large capital project or a simple shutdown, but it’s preventable if you’re prepared.

How can you ensure that you are ready for startup as scheduled?

What is Commissioning & Startup (CSU)?

Commissioning & Startup (CSU) is the asset life cycle phase during which the project team transitions the project from Engineering, Procurement, and Construction (EPC) to ongoing manufacturing operations. Rather than being confined to one formal stage of the asset life cycle, CSU covers several stages. CSU is the last critical phase of a capital project before the facility is placed in operation.

During CSU, trained professionals inspect, test, and qualify the assets (equipment, instrumentation, control systems, etc.) in your facility to verify that they have been installed properly and will operate safely. Experience suggests that breaking the plant down into systems and subsystems helps isolate potential issues during this part of the process, while maximizing your chances of a successful hand-off to operations.

Planning, Communication, & Coordination

Ideally, planning and budgeting for CSU should begin during FEL 2 or FEL 3 and include all stakeholders working together. Proper coordination involves the collaboration of different viewpoints from all stakeholders – construction, operations, engineering, and CSU – discussing and sharing schedules for increased efficiency.

Not only does this ensure your assets are built correctly, but you also streamline the transition from construction to commissioning followed by operations.

Working with CSU specialists in the early phases of a project grants knowledge and insight toward the operational aspect of the facility versus just the engineering side. This cost-effective and time-saving approach allows all stakeholders to ask questions, evaluate, and bring attention to potential design issues and can mitigate risk down the road.

Coordination and constant communication are essential to the success of any project. Reports, schedules, calls, meetings, emails, on-site personnel, and verbal communication are just some of the ways to alert everyone of project delays or current issues. When these methods are used properly, the project path is made clearer and corrective actions can be put in place to mitigate any time lost.

With all stakeholders working together and with proper communication, a project will meet milestones to save both time and money.

Training is Part of the Process

Your operators need to be trained in the processes and procedures of your new facility, including what to do in emergency situations or shutdowns. In addition, your operators should be involved in the walkthrough of the facility while developing the punch list. This type of involvement allows the operators to build familiarity with the plant before the plant is running.

The amount of training will depend on your personnel. Having personnel with 20 years of experience or more is obviously different than having new personnel who have never worked in a plant environment. Tormod has worked with all experience levels, and we are confident in our ability to train your operators before the plant begins operation.

Using a System Turnover

When executing commissioning activities, it’s our belief that the best approach is under the systemization method. As opposed to a block turnover, which is based on commissioning associated to location, a systemization turnover is based on the individual systems and subsystems within your facility.

A systemization turnover increases your project’s efficiency whether they are greenfield or brownfield designs. With proper coordination and communication, the construction activities can be executed around the preidentified system and subsystem, allowing for commissioning activities to be executed in a predefined order. This approach allows for both construction and commissioning to run parallel to one another.

A block turnover typically delays commissioning because the team must wait until the predefined blocks are completed and turned over. In most cases, predefined blocks are large and boundaries are difficult to navigate. As a result, you are exposed to potential safety hazards and complicate the turnover process from construction to commissioning. A system turnover can help mitigate both safety and turnover concerns. Each system and subsystem can be isolated from the construction of others and safely commissioned.

The Domino Effect

By using a system turnover, planning your commissioning activities early in the project phase, and coordinating with construction, you create a domino effect that saves you time and money.

If your CSU group is not inspecting, testing, and qualifying assets as you go, you could find out at startup that you have bad equipment or a piece that was installed incorrectly. This delays your startup and will cost you additional money to fix the problem.

However, using the domino effect, your CSU group will be conducting loop checks, testing pumps, flushing systems, and more to ensure everything is correctly installed and working properly. This means that once construction completes a system, commissioning then takes over that system, and if any issues are found by commissioning, construction can fix the problem while they are still on-site.

Working with Tormod

Preparing for commissioning & startup – whether when designing a completely new facility or working through an outage at an existing plant – is not a one-size-fits-all activity. There isn’t a list of ten or twenty items that every facility must complete. Clients and contractors should work together to determine the right solutions and the right skilled teammates to have involved in the project.

Tormod, a Hargrove company, has industry specialists with operations experience to determine real-world applications of how the design of your project will affect operations and maintenance.

Working closely with the engineering, construction, and operations groups, our Team will help determine the best design for your facility and will develop procedures and training documentation for your staff.

To partner with Tormod or learn more about our Commissioning & Startup capabilities, contact us.

Imagine you’re a plant manager with plans for a new, greenfield plant, on the critical path, and ready to begin construction. However, a detailed scope and realistic timeline have yet to be determined, so the plant’s permitting cost can’t be pragmatically quoted until sufficient information becomes known. You’re eager to initiate work for the project, so you decide to bid out the work.

Do you request a lump sum or time & materials (T&M) quotation for this work?

 

Working with an Undefined Scope

When the scope of the project is not yet defined, such as is the case with the example above, the project cost risk is enormous. Project cost risk must be owned by someone and when using a lump sum pricing methodology, suppliers are forced to own the project cost risk. If a supplier provides a lump sum price for the un-scoped project, they will inflate the lump sum price to compensate for owning this risk.

In cases such as this, suppliers will also pay close attention to each detail of the project’s execution, looking for opportunities to force project change notifications (change orders), thus increasing the project’s cost. This process also causes unnecessary delays while change orders are negotiated and approved. These delays are on the project’s critical path and postpone the project’s construction, commissioning, and startup dates.

Managing a large, complex project in an environment of constant change order negotiation and documentation requires additional staff and can dampen the morale of the combined project team. Typically, productivity is lower and turnover is higher in this type of antagonistic (“us vs. them”) project environment. Activities that do not drive the project forward waste time, money, and resources. Ultimately, this low-trust, high-risk environment results in higher costs and more time expended.

 

Choosing a Time & Materials Approach

T&M is the superior pricing approach when the scope is not well-defined. Executing a project using a T&M pricing approach with a trusted, professional supplier will ultimately result in the lowest possible total cost. This can occur when all suppliers and professionals on the team are committed to the project as well as tracking and managing the proper Key Performance Indicators (KPIs).

The key to success is the talent, focus, and commitment of the team. When this recipe is correct, it reduces the need for change orders. If a scope change is understood, documented, reviewed, and approved by trusted project management staff, the entire team responds professionally and completes the work in a timely manner. Team morale is enhanced, and the project is on a direct path to achieving its planned milestones.

To meet aggressive milestone dates, look for a partner that utilizes the advantages of Agile Project Management when the complete project scope is not fully defined. The Agile methodology results in better, faster, lower cost projects when time is of the essence and there are risks and uncertainties regarding scope and timeline. A T&M procurement strategy is normally the optimal approach when this situation exists.

 

Selecting a Trusted Partner using a T&M Approach

Choosing the T&M approach with a trusted, professional partner like Tormod will result in lower project costs and timely project results.

To learn more about Teaming with Tormod, visit our website.