Scheduling for Capital Projects: Managing Execution Schedules

Just as P&IDs are the master document for solidifying a project’s scope, the project schedule is the most critical management document for ensuring the successful execution of a capital project.

Scheduling for capital projects, of course, is essential for ensuring projects meet their intended timeline—but these documents are so much more than that. Cost management, change management, resource management, and planning depend heavily on schedule accuracy and compliance. Therefore, schedules should be maintained by the project control group but owned by the entire team. Everyone working on the project should know how their role fits into the schedule, and in turn, how their job affects other team members and functions.

Scheduling for Capital Projects: Building a Capital Project Schedule

While there are several methods of scheduling for capital projects, Gantt charts are used almost exclusively in industrial settings, with Oracle Primavera and Microsoft Project being the most common scheduling tools. The purpose of the Gantt chart is to identify the critical path for the project across loaded project activities. Finding the most efficient critical path typically yields more successful project outcomes with regard to time and cost.

The best project schedules are not thrown together after an award notice. Instead, they are thought through well before the project execution. The execution team's scheduling effort should align with how the project estimate was created. In fact, it is best practice to create the schedule before the estimate is complete to ensure accurate durations are used in the cost estimates for labor, field materials (items such as scaffolding), and indirect costs (items such as supervision and project trailers). Therefore, by the Execution Phase (start of Detail Design) of the project, a detailed schedule showing the schedule of activities should be established. The AACE defines a detailed schedule as a Class 1 schedule, with schedule definition increasing as the project progresses from Class 5 to Class 1.

The first step in creating the project schedule is identifying a Work Breakdown Structure (WBS) for the project. The WBS is a visual tool that organizes the work to be done by breaking the project down into hierarchical categories that result in the deliverables and activities for each category. This is sometimes called Work Packages. There are no time or dependencies shown in the WBS hierarchy. In the Primavera example above, the Heading of each section and the corresponding activities represent the WBS. Note that the WBS elements are typically organized similarly in the code of accounts, so that cost reports are consistent with WBS category budgets.

When time durations and dependencies are added to activities, the result is a project schedule.

Steps Involved in Scheduling for Capital Projects

Steps involved in scheduling for capital projects (creating a good project execution schedule):

1. Break the scope into a logical WBS
2. Ensure that activities are arranged and defined in a way that will allow the activities to be progressed
   a. Earned Value Management will be addressed more thoroughly in another article
3. Add durations per estimated activity
4. Add milestone requirements
5. Link activity dependencies
6. Resource load the schedule
7. Reconcile the schedule with scope requirements 
   a. Make sure the schedule meets the scope and timing requirements
8. Perform critical path analysis
9. Review with the execution team to ensure technical and constructability areas of importance are addressed.
10. Create project baseline 

Maintaining and Controlling the Schedule

Once the project starts, the project schedule is the key management document to ensure that the execution aligns with planned expectations. At regular intervals (usually daily or weekly), the project should be updated with “earned value” for the period to track the progress of the work relative to what was expected. 

Below is a sample project summary report that shows project progress.

The blue line in the chart above represents the initial baseline plan that is set up prior to the project start (called the S-curve). The green line represents the actual progress of the project, as value is earned based on the Rules of Credit. Rules of Credit are established to determine the progress that will be “earned” for each activity as it is completed. The yellow line represents the forecasted position of the project in the future. 

SPI (Schedule Performance Index) represents the performance of the project with respect to the schedule. A value of 1 is the planned value, with above 1 being ahead of plan and below 1 being behind plan.

CPI (Cost Performance Index) represents the cost performance of the project. A value of 1 is the planned value, with above 1 being above expected cost, and below 1 being below expected cost.

It is essential that the project schedule remains accurate and is updated in a timely fashion to ensure good control of the project. Control processes for field quantities reported, engineering activity completeness, and subcontractor progress should be established and stringently maintained to ensure that the project schedule and progress trackers accurately reflect the state of the project.

H+M Industrial EPC: Bringing The Best to Your Project

At H+M Industrial EPC, we ensure your complex industrial projects are delivered on time with accuracy during every step of the process. Scheduling for capital projects can get done more efficiently with H+M. We will provide you with detailed execution schedules to minimize project risks and promote overall project success.

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