1. Genesis of this document

Phoenix embarked upon its next phase of growth, undertaking multiple projects in April 2018. Around the same time Phoenix partnered with Turner International to set up the Program Management Office (PMO) to create and introduce formal systems and processes to manage the development of these projects.

In our first endeavour on the development process, we centralised the Design, Contracts and coordination with the PMO, leaving the construction management to the Project Management Consultants (PMC’s) appointed for each of the Projects. The PMO effectively run the projects under the leadership of project specific CEOs.

By the end of 2018 we realised that the PMCs were not as effective in managing the construction & coordination. The result was that Phoenix was not reaping the benefits and the outcome as planned. To address this gap, we introduced the General Contractor (GC) delivery concept in most of the projects, with the GC assuming maximum responsibilities for project delivery. By mid 2019, it was clear that the PMCs are not taking the desired ownership as required. The lack of effective coordination between the PMC and GC, lead to design parameters not being met and almost every project having severe cost overrun with delayed schedules.

In April 2019, we adjusted by restructuring the leadership of the organisation wherein the project CEO concept was removed, and functional heads were appointed for each of the activities under the leadership of new group CEO.

One of the key reasons attributed to delays in projects was attributed to non-availability of Coordinated Drawings and uncoordinated changes along with lack of “Change Management of Designs” in the middle of the execution. To resolve this, we embarked upon the introduction of a new system, where a development plan and gateway system were conceptualised requiring closure of all Design and Drawings before the start of the construction. To meet this, LDC was a key element in the system for developing the coordinated drawings. Introducing a further control mechanism so that no change can be introduced unless there is a real necessity, Senior Management approval for Change Management was made mandatory along with appointment of Lead Design Consultant (LDC) for all the projects to manage the co-ordination of the Design of all trades.

Additional significant changes to the structure were introduced to deal with project/site specific management issues by a having a General Manager to lead group of Projects. This also facilitated the extraction of PMCs from the sites. This system has gone through multiple iterations and we are seeing the benefit of the same in the projects recently launched. Further Phoenix embarked upon ERP in 2019, which is a major exercise, though has significant challenge to get full participation.

As we go forward, we shall learn and adjust our structure for future projects. The mantra is to keep it simple with a binary approach. This is also to properly define responsibility and hold teams accountable.

We are splitting the process into two larger silos.

The first silo shall be a centralised design development team (Concept & Design Development or CDD) to close out the Designs & GFC Drawings lead by the LDC and the Approvals.

The second silo will be management of project sites and construction activities. There shall be a General Manager who shall act as the Client Representative for the project. The General Manager shall be supported by a team consisting of Project Management Control Systems (PMCS) Manager, Construction Manager, Design Coordinator, QS, Finance SPOC. This GC with help of site team shall be adequately empowered to handle the shop drawings coordination with vendor and LDC and to take all decisions at the site level except those which need to be escalated to the management, based on cost and time. The GM team shall act as the bridge between the LDC and GC. All emails and communications related to contractor queries, RFI’s etc shall be taken up by the GC with the LDC by keeping the GM’s team in loop. The GMs will report to the Program Director of PMO.

The PMO will be acting as the bridge between these two silos and responsible for policies, processes, MIS, Quality and Safety apart from overseeing constructions through the GM offices.

In addition, as part of the Central Team, we have created a pre contract team, which shall be responsible for the closure of all packages with the support of procurement team. A new commercial department has been constituted to oversee the Pre contract and Legal departments. In a nutshell, the various functional teams shall work together to deliver the project in agreed time and the budget, using ERP.

The overall organisation structure for project delivery is covered in detail in the next section.

In July 2020, the PMO conducted a study to evaluate the restructuring efforts. The purpose of this study was to analyse the overall organisational project delivery mechanism and suggest suitable process improvements & procedures at various levels to improve the overall project delivery. Following critical issues were identified during Project Data Review & Initial Analysis which are relevant for the way forward of this document.

1. Project Delivery is delayed leading to cost variations and inability to match budget figures, preventing works from being implemented on site due to shortage in budget funding.
2. Time Variance in planned Vs actual project schedule is ranging from 0 to 51% (Average Time Variation 17.89%.
3. Cost Variance in initial budget Vs final budget is ranging from 0 to 16.64% (Average - 8.71%) on various projects.
4. Avg. cost variation to time variance ratio is appx. 2.0 against industry practice of 1.2 in general conditions due to increase in scope and max up to 1.40-1.50 in exceptional cases.
5. Current ratio indicates around 50% additional time is taken on scope enhancement cases on projects, which are resulting in to delays in project deliveries.
6. GC’s complete failure to function, as General Contractor’s role, as defined in agreed contract conditions and accepted, as per National/ International industry practices defined under FIDIC/other contracts is a major concern & also key reason for delivery lapses.
7. Design inadequacy is also resulting in cost variations & time loss. Lack of clarity on likely cost with respect to design concluded or incorrect cost assumptions have also lead to cost variations during execution.
8. Coordination issues with GC & NSC’s is resulting time loss, productivity & variations.
9. Supply of tower crane, hoist, few materials like façade glass, finishing material through client scope had huge impact on timely delivery.
10. Procurement issues i.e. simplification of entire procurement process along with seamless integration with actual construction progress is desired to ensure time saving.
11. GC’s work ethics at times are not professional & conducive for timely project delivery and skewed towards protecting their turf.
12. GC’s project team’s approach & skills are not adequate for actual Project Delivery requirements.
13. No mechanism is currently in place to track centralised purchases, interlinked to ERP w.r.t schedule and cost highlighting the cost / time variance if any.
14. No mechanism is in place to review the actual performance of various packages awarded on different projects.
15. Prequalification process for GC’s/ other agencies/LDC suitability for specific project needs to be developed for project specific requirements.
16. Mechanism to arrest and take corrective measures for critical bottle necks on various project needs to be developed.

Having streamlined the organisation structure and introduction of ERP, it was felt necessary to capture the various key activities in the development and desired processes by way of flowcharts and other tools and produce the same in the form of a process document.

This document is expected to provide clarity to all the stakeholders involved in the development and be available as a reference manual, should there be lack of clarity. This document will be updated periodically based on the fine tuning of the processes over the period, feedback, suggestions and refinement from the stakeholders.