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Updated: November 14, 2011 11:08 IST

Understanding project management

D. Murali
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Generally, the accomplishment of a task or a group of tasks, from concept to successful commissioning within a pre-determined timeline and cost, is termed as project, begins S. N. Choudhary, formerly Executive Director (Projects) at the Panipat Refinery of Indian Oil Corporation Ltd (IOCL), and currently in New Delhi as Executive Director (Refineries Division), Maintenance & Inspection. He clarifies, however, that the very word ‘management’ comes into picture only when the scale of operation in terms of conceptualisation and/or realisation of the tasks is quite large and complex in nature.

“We all execute several household projects on a day-to-day basis but those projects have lots of flexibility in terms of cost, time, and quality depending upon individual’s capacity in terms of his taste, preoccupation and financial standing etc. But the industrial projects are entirely different,” adds Choudhary, during a recent telephonic interaction with Business Line. Such projects imbibe a definite cost, a fixed timeline, invariable specifications and large number of activities, he explains. “Furthermore, the execution of industrial projects requires compliance with various statutory obligations for the workmen including implementation of safety, health and environmental policy. Therefore, the present-day project management is considered as not only the accomplishment of task within the predetermined time and cost, but its success is gauged only when it is appreciated by all the interested parties including all statutory bodies.” Our conversation continues over the email.

Excerpts from the interview.

Are there notions about project management (as learnt from theory and classrooms) that do not hold good in real life?

The classroom theory of project management appears to be so simple that most people consider project management to be a cakewalk. The client, the consultant and the contractor – the trio plays a pivotal role in project management. The consultant is the arm of the owner who controls and monitors the project. The contractor provides a mutually-agreed schedule of completion of various activities involved in the project, and it is expected that the schedule will be honoured by the contractor. It is also expected that in the case of slippages in achieving the schedule, the contractor will take all corrective measures, and the owner and the consultant will help the contractor in controlling or arresting the slippages.

Software packages for project monitoring are available in our country; and, religiously, the PERT/CPM network is developed through software at the beginning of the project with time schedule of each activity. Preceding and succeeding activities with connectivity, parallel activities to be executed concurrently to save time, the critical path activities where no delay is permissible, all these are plotted with a good intention to execute the project on time. This is definitely an excellent tool for monitoring the project. But the real-life situation is entirely different, as the project does not only include the aforesaid trio but also innumerable business partners like the suppliers of equipment and other materials, sub-contractors working under the main contractors, the State administration, local and demographical factors as regards the availability of skill, the culture and level of commitment, and unpredictable human behaviour.

In our country, the facilitation of project implementation is very often marred due to the inflated ego prevailing among consultants and owners. The relationship between consultant and owner and contractor is vitiated due to feudal mentality and in most of the cases it is similar to master and servant relationship, rather than one of business partners.

The trio cares a fig for honouring mutual commitments towards one another. The suppliers of equipment, machinery and other items seldom adhere to the schedules agreed to during the finalisation of orders. The State administration also takes its own time in facilitating project implementation. The infrastructure is woefully inadequate. Most of the contractors are totally insensitive towards the welfare and health problems of the workforce. The productivity of the workforce has degenerated considerably in comparison to the productivity of earlier days due to a general fall in moral values.

In the current scenario, there is a declining trend of availability of skills among supervisors, engineers and project managers, which has a telling effect on the completion of large-size projects. There is a sheer lack of planning for skill development of engineers and workforce, both by the individual organisations and by the Government.

Thus, while the classroom theory of project management considers the ideal situation, in real life none of those theories is being practised by any business partners as narrated above. Finally, the project managers end up in a piquant situation and find themselves totally trapped in the cobweb of project slippages. It is practically impossible in a government organisation to follow all the rules of contract and complete a project on time. The timely completion of a project in government organisations totally depends upon the risk-taking ability of the project leader.

Are there best practices that we can adopt from across the world, in project management?

I have had the opportunity to work with some of the best contractors of India and abroad, such as Larsen & Toubro and Punj Lloyd from India, Daelim, Samsung and LG from Korea, Toyo from Japan, Tecnimont from Italy and many others. Also, I have had interactions with their engineers over a decade, in various projects. Indian Oil Corporation ventured into lump-sum turnkey (LSTK) mode of execution with a view to expedite project completion as well as to assimilate their good practices into the corporate culture of project implementation; and the experience has been mixed.

The procedure of award of work on the lowest basis is a thorn in the flesh. The mushroom growth of contractors, with no control parameters to prevent them, poses a big question mark on bringing the project implementation at par with the developed countries. Yet, many best practices of the developed countries have been translated into reality in the naphtha cracker project, such as welfare measures for labourers which enhanced their productivity, and automation in excavation, concreting, welding etc. But such measures are only a few drops in the ocean of development, if we have to catapult our project implementation methodology to be on par with the developed countries.

This needs a thorough change in the mindset of all business partners involved in projects, which includes change in legislation, a complete overhaul of labour laws, inculcating a practice of high remuneration, and a generic change in contracting practices, and strong punitive measures including putting erring contractors on holiday. This also requires upgradation of academic standards of workmen as well as contractors which is abysmally poor in India. That is why, all the reputed contractors as explained above, necessarily engage Indian contractors and labourers and therefore, it has not been possible to adopt many best practices which are prevalent in the developed countries.

There is a sheer reluctance on the part of indigenous contractors to adopt good practices for cost-cutting, apart from the lack of awareness among labourers due to cultural factors. Nevertheless, there is a ray of hope that the project management methodology has taken a quantum jump in the recent past. Unless standards of Indian contractors, and manufacturers improve towards adhering to the agreed targets, project managers are adequately empowered, owner and consultant give up feudal mindset and work really as a business partners with all agencies, it would not be possible to adopt best practices. Moreover, owner should have a strong desire to advocate for change in the old practices even at a higher cost, rather than to set out the goal only for project completion. As such, in the present circumstances, it would not be possible to implement the best practices of developed countries in the public sector. Unfortunately, even the private sector players have no interest in benchmarking the standard at par with some of the developed countries.

**

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