Capital and Maintenance Projects with Noveco ePM

Industries

Capital Intensive industries such as Utilities,  Mining,  Oil & Gas etc.

The challenge of managing capital projects

Capital Projects are usually part of a bigger picture: Investment Programs and Portfolios. They are assigned to program items and allocated an approved budget. Capital projects vary in size and are often executed using maintenance orders, since they provide better functionality to manage exact resources needed and schedule dates where work is to be performed; work orders also used to procure materials and services, confirm actual labour hours and finally provide seamless integration to fixed assets being built.

The biggest challenge in management of capital projects is the ability to coordinate:

1. Project Planning and Estimating
  • Ability to perform cost estimation on a various stages of project lifecycle (from concept plan to final estimate)
  • Budget allocation, resource requirement planning and balancing across other projects, programs and portfolios
  • Define long-lead time equipment to procure
2. Work Order execution stemming from project planning
  • Work order generated  and assigned to project tasks and/or work-packages
  • Detailed dates schedule, material requirements planning, detailed resource planning is performed on work order level
  • Labour time confirmation, material inventory management, procurement of long-lead items, procurement of sub-contracted services
  • Fixed asset integration (directly or via project WBS)
3. Project Forecasting (or on-going financial replanning) in integration with work orders
  • Complete visibility at a project level of all actual costs collected by the work orders or posted directly to project activities or WBS element (e.g. design, engineering)
  • Integrate actual costs and labour from work orders and ability to recalculate project progress, remaining costs complete and estimate cost at completion of the project
  • Predict Budget overruns early before the hit project
  • Manage project variations and budget adjustments
4. Project Variations and Issue Management
  • Keep track of project variations, budget transfers and adjustments between work-packages with complete audit trail history
  • Estimate costs and revenue of budget variations and seamlessly integrate them into project revenue plan, budget and forecasts
  • Ability to manage project contingencies and report them separately from variations affecting project budget
5. Project and Program reporting and analysis
  • Top Down (from Program down to Project) control of allocated budget and funds
  • Bottom Up (from Project up to Program) visibility of actual costs, forecasts of estimated costs to complete and costs at completion, forecast of remaining resource requirements, forecast of potential budget overruns
  • Report on project financial KPIs: cash, budget, forecast at completion, open orders, forecast profit margin etc.
  • Project financial history snapshot and analysis: budget, forecasts at completion, revenue and profit changes over time.

Two typical project structures used in capital projects

Option 1: Full project structure: WBS and Network Activities, Work Orders are assigned to network activities

WBS Elements

  • Represent: project organizational structure (e.g. Project Types, Phases, Asset)
  • Used for overall: project budget control and progress reporting on a high level

Network Activities

  • Represent: project tasks that linked in relationships
  • Used for detailed: dates scheduling, costs planning and forecasting, progress reporting

Work Orders

  • Represent: physical work or activity to performed on the site (e.g. fitting, testing)
  • Used for exact: dates scheduling, resource and materials planning, cost collection

Option 2: Project structure consists of WBS elements only, Work Orders are assigned to WBS elements

WBS Elements

  • Represent: project organizational structure (e.g. Project Types, Phases, Tasks and possibly Asset)
  • Used for detailed: project budget control, dates scheduling, costs planning and forecasting, progress reporting

Work Orders

  • Represent: physical work or activity to performed on the site (e.g. fitting, testing)
  • Used for exact: dates scheduling, resource and materials planning, cost collection

SAP solution enhanced by Noveco ePM for capital projects

Leading companies implementing SAP system to manage challenges associated with planning and running capital projects and programs, with an aim to enhance effectiveness in the following areas:

  • Accurate cost estimation against efficient project structures
  • Effective Planning, accurate budgeting
  • Clear, timely visibility of costs, revenues, cash position
  • Forecasting of project costs, resources, revenues
  • Measure/Report progress, earned value, productivity
  • Efficient variations, escalations and seamless integration with cost forecasts and revenue planning
  • Integration of subcontractors, monitoring of work performed, progress reporting
  • Accurate billing and invoicing
  • KPI monitoring and relevant reporting

SAP ERP, Project System and Noveco ePM provide the complete integrated solution suited to manage your capital project in SAP seamlessly and effectively.

What Noveco does that SAP standard does not

Noveco solutions integrates work orders into project planning and forecasting, which means:
  • Project Planning is done on project level: on WBS or Network Activities
  • Detailed work planning, execution and confirmation is done though work orders assigned to project WBS or Network Activities
  • Forecasting remaining work and costs to complete is performed on WBS or Network Activities taking actual work and costs from assigned work orders
Noveco ePM Project Manager Workbench and Project Manager Portal provide instant visibility into your Capital Projects enabling you to analyze and forecast directly in SAP ERP
The ePM Workbench is a one stop-shop for Project Managers to view and maintain critical elements of the Capital Project life cycle;

 

 

  • Report on Key Performance Indicators: Cash in and out, Budgets, Cost to Complete, Variations, Actual Costs Forecast Total Costs, Cost To Complete, Work to Complete
  • Automatic recalculation and distribution of Cost To Complete
  • Cost and Work forecasts
  • Purchasing Commitments
  • Variations and Issues Register and report
  • Contingency Management in complete integration with variations, budgets and forecasts
  • Context Drill-down reports: point and click to get into underlying documents directly from ERP
  • Built-in reports and analysis
  • Automatic Project Forecast history tracking
Lets you perform Cost Forecasting

Our ePM Workbench enables automatic recalculation of your project forecast cost to complete and estimated costs at completion based on actual costs and purchasing commitments posted to your project by planning period

 

  • Automatic forecasting based on overspend saves Project Manager time as he/she does not need to do this manually
  • Perform manual forecasting of Cost to Complete on WBS, Network Activities or PM/SC orders by Cost Elements or network operation work quantity
  • Perform cost forecasting by value or quantity multiplied by labour rates
  • Instant Integration of forecast results with Project Results Analysis
Integrated Variation and Issues Management
  • Plan Costs and Revenues within one variation document
  • Assign variation costs to multiple project elements (WBS, Network Activities and orders) within one variation document
  • Variation status control, e.g. Pending, Approved with automatic cost allocation to assigned Project elements (WBS, Network Activities): update project current budget and Cost To Complete depending on variation status
  • Sales Document update with revenue adjustment from variation document
  • Full Integration with Project cost forecasting and reporting
Reporting
  • Full history of project Estimated at Completion, Cost to Complete, Commitments, Actual costs, Budget, Variation of costs and revenue values. See how your project was evolving during its lifecycle.
  • Report Project Variations and Budget changes
  • Report Original Project Estimation vs. Project Actual Costs at its completion

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