Interface Management for Complex Capital Projects

Abstract

In recent years, Interface Management (IM) practices have been emerging to address the challenges of managing complex capital projects. These challenges include the added complexity and scale of these projects, globalization, geographical distribution and various working cultures, and different internal and external risks. Oil sands, off-shore and nuclear are examples of this class of projects. Despite an emerging consensus on the effectiveness of IM for facilitating complex projects delivery, IM definitions, elements, and the way it has been implemented varies widely across the construction industry. Furthermore, identifying key interface points, integrating IM with the project schedule, and the relationship between IM implementation and project performance are significant questions that owners and contractors wish to have addressed. Therefore, the objectives of this thesis are to develop a workflow driven process for IM, study its current status in the industry, develop an algorithm to identify key interface points and integrate IM with project schedule, and investigate the relationship between IM implementation and project performance. This research is mostly focused on industrial construction, though some data from other sectors is included. In this thesis, the elements and fundamental definitions of Interface Management are proposed. Then, a workflow driven Interface Management System (IMS) is developed, which lays out a strategy to systematically identify and manage stakeholders’ interfaces with the objective of more effective risk management in capital projects. Once the IMS ontology is defined, the current state of IM in the construction industry is studied through data collection on 46 projects by conducting questionnaire based interviews. The interviewed projects are from different sectors of the industry, with various sizes and geographical locations. This study aims at identifying the project characteristics that lead to formal IM implementation in a project, current common IM practices in the industry, and criteria to assess the status and effectiveness of IM. Furthermore, the relationship between IM implementation and project performance in terms of cost and schedule growth is investigated by employing descriptive and statistical analysis tools. One observation was that those projects that implemented IM at a high level experienced lower cost growth and less variation in the cost growth. This thesis also proposes a methodology to identify key interface points by recognizing the interdependency relationships between them and creating the Interface Points Network. By analyzing the network, two types of high impact and risk prone interface points are identified. Once the key interface points are recognized, they are linked to the interface milestones on the project schedule, to integrate the cyclic information of IMS with the conventional, sequential planning, scheduling and control paradigms (e.g. CPM). The proposed algorithms are validated on a representative offshore model project. In summary, the proposed algorithms in this thesis provide a framework to improve project performance through better alignment between stakeholders, enforcement of contract terms, and effective sharing and distribution of risk-related information within formalized interface management framework. The empirical analysis also sets a foundation for construction organizations to assess their IM with regard to the current practices in the industry and a roadmap to improve their IM practices to more mature levels.