The client specialized in the full software implementation that controls all aspects of intercity rail transportation, either manned trains or unmanned trains.
The project was focused on maximizing value by attacking the various root causes of rework throughout the project cycle. As it is predominantly an engineering operation, (in this case software engineering) value is added when an engineer is writing effective code. All activities that take away from this task needed to be identified and minimized (such as redesigns, rework, indirect administration, etc.)
Our analysis of the key drivers of value indicated that the performance factors that needed to be managed were schedule attainment, quality, and productivity. Customer defined schedule attainment needed to be the basis of all integrated planning; productivity needed to measure earned value against total paid hours. Quality needed to be measured to provide causal analysis tools to reduce rework.
The project was completed over a seven-month period and involved all areas of the business including the project management office, technology, software engineering, procurement, hardware manufacturing and quality.
- Installed a new management system that gives managers better visibility of specific deliverables.
- A Mini Milestone concept was introduced that decomposes 200-hour work packages into planning sections of less than 20 hours.
- The growth will more than occupy the current headcount and the company will be able to capitalize on that growth by increasing the leverage of departmental managers.
- In the indirect areas, the marketing department is revising and standardizing the process of estimation, the Project Management Office (PMO), finance and procurement departments have established new reporting procedures to the functional departments that they support.
The Results
Specific Results Included:
- Annualized financial results are generating a return roughly three times the cost of the initiative.
- In the “Direct” areas, earned value as a percentage of total direct time (i.e., taking out vacation, training, etc.) is tracking at a 30% increase over the base period.
- This has led to improvements in flow through and output that is reducing backlog in the engineering departments to the tune of over 8,000 hours a month, effectively adding the work of over 60 extra engineers without adding any additional resources.
