From North American Downstream Market Outlook and Insights 2019 | p.70-73
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Petrochemical and refining turnaround teams can significantly improve cost, schedule and management of their turnaround and capital projects if they turn to next evolution best practices; such as scope index benchmarking, effective site leadership, contract strategy, risk-based scope reviews, and schedule optimization, according to Tom Mankowski of AP-Networks.
Why do some of the front runners achieve predictable and competitive turnarounds and others achieve predictable performance, but not competitive performance? What extraordinary practices could be quantified and become industry norms?
Mankowski is the Practice Area Manager, Turnaround Consulting for AP-Networks and gave a presentation on The Turnaround Performance Paradigm and Turnaround Value Practices at Downstream 2018 in Galveston.
While the turnaround industry has gradually improved over the years mainly in the safety arena, there is still plenty of room for improvement, however, he said while speaking at the event.
“The laggards are not predictable and not competitive,” said Tom Mankowski of AP-Networks. Meanwhile, the frontrunners are more predictable, but not necessarily more competitive.”
AP-Networks wondered what set the front runners apart and embarked on a research study to statistically correlate specific practices to competitive event performance.
The methodology was to use AP-Network’s Turnaround Readiness Index (TRI), an online turnaround planning and preparation readiness assessment tool or questionnaire, and then analyze the data further.
The Turnaround Pyramid is a tool AP-Networks uses to quantify the readiness of a turnaround at different points in time. Scores are varied on a rating system of 1 to 5. The index allows AP-Networks to predict the outcome of the turnaround. As many would assume, turnaround readiness drives predictability performance.
“As people are better prepared for turnarounds, their performance improves…schedules and costs improve with schedules seeing the greatest success,” Mankowski said
Figure 1 – Turnaround Readiness Index
Then, AP-Networks took it a step further to look at the same TRI data with respect to what best practices impact performance.
All sites have work process, but some have taken it a step further. For the sake of the AP-Networks exercise, the best practices were organized as follows
- Common Practices: Adopted concepts – E.g., Turnaround Work Process, Scope Development Process
- Industry Proven Practices: Somewhat adopted concepts – E.g., Compliance, Assurance, Milestones, Scope Freeze, Event Integration
- Turnaround Value Practices (TVP): Next evolution – g., Scope Index Benchmarking, Effective Site Leadership, Contract Strategy, Risk Based Scope Reviews, Schedule Optimization
The study revealed that the turnarounds that are using Common Practices fell in the weak to average index.
The turnarounds teams that followed the Industry Proven Practices scored average up to optimal.
The turnaround teams with the greatest success are those who utilize the Next Evolution best practices or TVPs.
“Digging in further, the turnarounds that value Next Evolution or TVPs further define those who can hit an optimal level of readiness…those practices out of the ordinary…those practices that are specifically targeting improving specific areas of turnaround prep,” Mankowski said.
“Effective site leadership, steering teams, strategy teams, contract teams, risk-based review, scope index benchmarking. We see various levels of effectiveness across the board. The sites doing this well are distinguishing themselves from others,” he added.
Figure 2 – TRI with Turnaround Value Practices Incorporated
TVPs are out-of-the ordinary value practices used to improve the readiness and performance outcomes of the event. TVPs are not just standard tasks; instead, they follow a defined and distinct methodology and must be followed for the entire turnaround or event.
TVP outcomes and results are formally documented and actions are tracked to completion.
Each TVP should be applied during the various turnaround strategy, planning, scoping, preparation, and execution phases. TVPs are to be facilitated outside of the Event Team by experienced, independent, and credible facilitators.
AP-Networks stresses a three-step priority system: execute the plan right, execute the right scope, execute the scope right. Executing the plan right by improving planning readiness and the use of benchmarking to drive predictability.
Execute the scope right by improving planning readiness and the use of benchmarking to drive predictability and competitiveness.
“Looking at your influence in expenditure curves, we know we have the most influence on a turnaround in the early stages. When we are deciding on projects and scopes, this is when we have the biggest influence,” Mankowski said. “When we get to execution, we don’t have a lot of influence. The way we get these areas right is executing the work at the right time.”
Execute the right scope by improving planning readiness, use of benchmarking, and applying TVPs which drives predictability and competitiveness.
Figure 3 – Influence and Expenditure
“It’s not just about focusing on readiness and communication but adding strategic and tactical practices and also focusing on 20% of the things that make the 80% of difference, Mankowski said. “This is what drives us to the top, the best of the best.”