Ordinal Capital Project Ranking Evaluation and the Quality Component

Ordinal Capital Project Ranking Evaluation and the Quality Component

DOI: 10.4018/978-1-4666-2839-7.ch005
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There is a general sense of developing “new” capital projects in a virgin arena and deemed as high-quality than performing the necessary upgrades on an existing project. Based on the increased need to mobilize the necessary resources, each project in the reliability sector must be prioritized for safety reasons and to avoid potential equipment damage to expedite the work. Properly planned capital projects are skillfully integrated within the portfolio envelope. Conditions such as the projects in the reliability sector create blackouts, increase costs, and develop a poor safety environment if left unattended.
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Introduction: The Quality Component

The quality control techniques and methodologies utilized in the electrical equipment installation arena are typically categorized as a supplementary service. The data analysis is generic and applicable to a wide range of conditions when implemented within a Quality Management System (Aft, 1998). It is analyzed to determine adverse affects on the quality of the service and identify preventive or corrective actions. In the electric utility industry, waste reduction and material integration cycle times are two of the key attributes for equipment installation, specifically within the renewable energy sector. The three main categories for the quality control techniques are described below:

  • Diagnostic Techniques

  • Process Control

  • Acceptance Sampling

When these techniques are put into practice and applied religiously in a quality plan, the components of the Lean Paradigm will automatically drive the capital project cost downward. Moreover, when the quality plan is utilized as a foundation for utility best practices across the organization (planning, finance, project management office, engineering, maintenance, procurement, line shops, etc.), a drastic reduction in cost/waste is experienced in every aspect of the service. The Lean Paradigm is a systematic approach to provide a path that specifies value, evaluates the best viable sequence while continually improving the process. It espouses a business process of doing more with less. Management of a system of processes within an organization (commonly referred to as the process approach) is a continuing effort over the individual processes in the quality sphere. The combination and interaction of these processes is advantageous as a value-added service, meeting the stated requirements, evaluating the process performance effectiveness, and continuous improvement aspects based on the object measurement (ANSI/ISO/ASQ Q9001-2000, 2001). The Quality Assurance Plan is a component of Project Management Standard for the electric utility company. The document must encompass the major operational tenets of 1) Management Responsibility to include objectives, authority, and review, 2) Resource Management that entails a provision of resources, competence, awareness and training, 3) Process Realization to include the operational control aspect, customer communication, and management of the monitoring & measuring devices, and finally 4) Measurement, Analysis & Improvement mechanisms for an internal audit, control of the nonconforming process, analysis of data, improvement, and corrective/preventive action.

An example of the diagnostic technique germane to the electrical utility business utilizes cause-and-effect diagrams as well as Pareto Analysis for equipment installation scheduling delays. The technique is designed to pinpoint potential problems in a process that directly affect quality outcomes. Even the simplest processes, such as visitors entering a facility can be improved immensely when the method is utilized to categorize problems (Conklin, 2012). The continuous upgrading effort within a substation/line rehabilitation for renewable energy generation implementation invariably creates a plethora of problems in an organization. The Pareto diagram can successfully identify the primary causes of a transformer delay from a list of problems encountered by field personnel as described below:

  • Endangered species (pine snakes) were discovered once the ground was broken.

    • o

      Notified the department of environmental protection to re-file the permit applications (Preventable ~ Rework).

    • o

      Mitigation Strategy: Seek another parcel in parallel with permitting work effort to avoid massive construction delays (Corrective Action).

  • Local construction management resource issues

    • o

      Relieves over-burden line shop resources (Corrective Action).

    • o

      Manage contractors, safety issues, materials, etc. (Preventive ~ reduces bottlenecks).

  • Communication

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      The milestone need date (from the project manager to the engineering department) created a two month lag time for the electrical drawings and scope documents (Preventive).

    • o

      Resource turnover of internal/external engineers with no oversight of project control and created an annual engineering project backlog (Preventive).

    • o

      Verbal undocumented updates on critical equipment installation processes (Corrective Action).

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