Failure Evaluation of Engineering Projects in Nigeria (a Case Study of Pipeline and Product Marketing Company Limited, a Subsidiary of Nigerian National Petroleum Corporation)
Chapter One
AIM AND OBJECTIVES
The aim of this research is to identify the causes of project failure in Pipeline and Product Marketing Company Limited (PPMC) and recommend ways of reducing project failures and improving project success in the establishment.
The specific objectives are to:
- Assess the rate of failure of projects and their causes in the last five years in Pipeline and Product Marketing Company Limited(PPMC)
- Identify the causes of failure and abandonment of Engineering projects in PPMC
- Examine the failure mode criteria and warning signals so as to predict impending failure and abandonment of engineering projects in PPMC through subjective reasoning
- Study the contributory factors to success and failure in the implementation of Engineering projects by government consultants and professionals
- Suggest workable solutions to forestall the future problems of failure and abandonment of projects in PPMC.
CHAPTER TWO
LITERATURE REVIEW
PROJECT MANAGEMENT
DEFINITION OF PROJECT MANAGEMENT
Project management according to Abbasi and Al-Mharmah (2000) “is the art and science of planning, designing and managing work throughout all the phases of the project life cycle”. It is also regarded as a system or process of planning, designing, scheduling, managing and controlling interconnected project activities in order to achieve specific objectives or goal within a specific time, budget and standards (Lewis, 2007; Olateju etal., 2011).
Project Management is an innovative Management practice that tends to achieve stated or specified objectives within specific time and budget limits through optimum use of resources (Stuckenbruck & Zomorrodian, 1987).
Project Management is the discipline of carefully projecting or planning, organizing, motivating and controlling resources to achieve specific goals and meet specific success criteria. The temporary nature of projects stands in contrast with business as usual (or operations), which are repetitive, permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is often quite different, and as such requires the development of distinct technical skills and management strategies.
The primary challenge of project management is to achieve all of the project goals and objectives while honouring the preconceived constraints. The primary constraints are scope, time, quality and budget. The secondary and more ambitious challenge is to optimize the allocation of necessary inputs and integrate them to meet pre-defined objectives.
HISTORY OF PROJECT MANAGEMENT
Until 1900, civil engineering projects were generally managed by creative architects, engineers, and master builders themselves, for example Vitruvius, Christopher Wren (1632–1723), Thomas Telford (1757–1834) and Isambard Kingdom Brunel (1806– 1859). It was in the 1950s that organizations started to systematically apply project management tools and techniques to complex engineering projects (Lock, 2007; Kwak & Carayannis, 2005).
As a discipline, project management developed from several fields of application including civil construction, engineering, and heavy defence activity. Two forefathers of project management are Henry Gantt, called the father of planning and control techniques, who is famous for his use of the Gantt chart as a project management tool (alternatively Harmonogram first proposed by Karol Adamiecki); and Henri Fayol for his creation of the five management functions that form the foundation of the body of knowledge associated with project and program management. Both Gantt and Fayol were students of Frederick Winslow Taylor’s theories of scientific management. His work is the forerunner to modern project management tools including work breakdown structure (WBS) and resource allocation (Cleland & Gareis, 2006;Marsh, 1975).
The 1950s marked the beginning of the modern project management era where core engineering fields come together to work as one. Project Management became recognized as a distinct discipline arising from the management discipline with engineering model. In the United States, prior to the 1950s, projects were managed on an ad-hoc basis, using mostly Gantt charts and informal techniques and tools. At that time, two mathematical project-scheduling models were developed. The “Critical Path Method” (CPM) was developed as a joint venture between DuPont Corporation and Remington Rand Corporation for managing plant maintenance projects. And the “Program Evaluation and Review Technique” or PERT, was developed by the United States Navy in conjunction with the Corporation and Booz Allen Hamilton as part of the Polaris missile submarine program (Stauber etal, 1959).
PERT and CPM are very similar in their approach but still present some differences. CPM is used for projects that assume deterministic activity times; the times at which each activity will be carried out are known. PERT, on the other hand, allows for stochastic activity times; the times at which each activity will be carried out are uncertain or varied. Because of this core difference, CPM and PERT are used in different contexts. These mathematical techniques quickly spread into many private enterprises.
At the same time, as project-scheduling models were being developed, technology for project cost estimating, cost management, and engineering economics was evolving, with pioneering work by Hans Lang and others. In 1956, the American Association of Cost Engineers (now AACE International; the Association for the Advancement of Cost Engineering) was formed by early practitioners of project management and the associated specialties of planning and scheduling, cost estimating, and cost/schedule control (project control).
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
Research methodology is a way to systematically solve the research problem. Choosing an appropriate research methodology and research method are two different things. Therefore, the clarity of these two terminologies is essential for the purpose of this study. Research “methods” usually refers to specific activities designed to generate data (eg. Questionnaires, interviews, focus groups, observation) and research “methodology” is more about your attitude to and your understanding of research and the strategy or approach you choose to answer research questions (Greener & Martelli, 2008).
RESEARCH DESIGN
The term research design refers to researcher adoption of a procedural plan to answer questions on validity, accurately and objectively. This chapter describes the research design applied for the conduction of this study. it further examines the purpose of the study, the techniques used to conduct the research, the data collection methods and the data analysis process. Furthermore, justification of each choice is included in order for the research design to be supported.
The research has been through the following research design stages to ensure the research aims and objectives are achieved.
POPULATION OF THE STUDY
The population for this research consists of a large number of Project Engineers, Project Consultants, contractors, Project Managers, Project Owners and administrators. The research was focused on a small sample of this large group of people to generalize the result.
Selecting the targeted sample is a fundamental element in any research; clear identification and misidentification of the targeted sample has its advantages and disadvantages. However, it is impracticable to survey the entire population to answer the research questions, which involves difficulties in gaining access to all the samples and extended time of data collection and analysis. On the other hand, it seems obvious that the smaller and more sizeable the target sample is, the more likely the research will be practical, cheaper and save time in terms of data collection and analysis. Therefore, the targeted sample has to be clearly identified and chosen so as to achieve the required findings and results.
Based on the above, questionnaires were sent to randomly selected stakeholders in the industry, they include mainly site engineers/office engineers, Project Managers, Project Team Members, Project Supervisors, Project Consultants and Contractors at the top of their careers and who have had immense experience on Engineering Projects. Fifty (50)questionnaires were distributed as follows, twenty (20) to Engineers within PPMC that have served in one capacity or the other in PPMC projects within the last five years, ten (10) to consultants and twenty (20) to contractors. Rate of response will be discussed in the next chapter with analysis of results.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter of the research presents the data, analysis of the data and discussion of results obtained. Some real reports from past projects of PPMC are discussed, rate of failure of such projects determined based on factors identified. The questionnaires distributed and responses are also discussed and results compiled.
CHAPTER FIVE
CONCLUSION AND RECOMMENDATIONS
CONCLUSION
Considering the analysis of the selected projects presented in this report and the analysis of questionnaires administered to some professionals, some conclusion can be drawn on reasons for failure of projects in PPMC.
Looking at the constraints of project management, meeting the schedule time of project and maintaining the required quality have proven to be the major challenges that affects project success. In other words, the two constraints contribute 72% of the reasons for failure of projects in PPMC due to constraints.
However, the stakeholders do not see failure to finish projects on schedule as one of the criteria for determining the success or failure of their projects. They consider scoping, quality and delay in release of funds as the major causes of failure of their projects.
The following conclusions can be drawn from the results and analysis
- Considering the triple constraints of projects, 85% of the projects in PPMC were discovered to have failed within the period under
- Meeting the project schedule, bad scoping, budget and quality were found to be the major causes of project failure in PPMC with each contributing to 41%, 29%, 18% and 12% respectively to the total failure of the projects considering the triple 40% of the projects were found to have failed from stakeholder’s
- The stakeholder’s identified 37% of the failure from bad scope, 25% each from budget and quality and a combination of budget and time contributes to the remaining 13%.
- The type of failure identified from the analysis is mostly abandonment of the projects. This is causedby
- Delay in release of funds
- Scope Creep
- Inappropriate scope from the initial planning stage
- Lack of professional knowledge from the contractor
- Corruption
- Employment of means for adequate budgeting and timely milestone payment has been identified as the most workable solution to forestall the future problems of failure and abandonment of projects. This will eliminate delay in equipment delivery and ultimately improve project
RECOMMENDATIONS
The following measures if employed will improve projects delivery and success:
- Ensure adequate control measures are employed, this will enhance project success.
- Ensure early detection of failure signs to enhance timely project
- Ensure proper application of past experiences to improve chances of
- Management should ensure engagement of all stakeholders and dissemination of the right information to improve project
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