While this situation should be avoided by a proper project definition phase, it is sometimes necessary to substantially pivot and change course during the execution of a project. This implies significantly changing the project objectives and/or execution strategy. This situation necessarily creates substantial disruption. Based on our experience, our new White Paper 2023-12 ‘How to Pivot during the Execution Phase of a Large Complex Industrial Project’ describes good practices should this situation happen.
For owners, this can happen due to a number of events:
- significant regulatory changes (or more generally, changes to stakeholder requirements),
- changes in the facility product fit to the market, requiring a change to the product,
- unexpected changes to the main feedstock,
- unexpected difficulties in an innovative section of the facility,
- default of major contributor or contractor that is difficult to substitute.
For contractors, most such issues will be managed through a renegotiation of the contract with the owners. However, in some cases, EPC contractors can experience a need to pivot when the project execution strategy envisaged is not possible, e.g. due to the lack of availability of a difficult-to-substitute construction resource, requiring a substantial change of strategy.
Because those situations necessarily create significant disruption, additional costs and duration, they should be avoided as much as possible by a thorough and in-depth project development and preparation phase. Those situations are however more likely to happen on innovative projects, or very long projects (spanning more than a couple of years) due to project environment changes.
We first recommend to take time to clearly define the revised project. This requires the mobilisation a small task force to go through a scoping and feasibility phase before being able to commit to the pivoted project. This re-definition phase of the pivoted project will also allow to understand fully the direct and indirect consequences of the pivot. To minimise disruption to ongoing activities, this task force should remain discrete and not communicate its work to the rest of the project.
Significantly pivoting an industrial project during its execution must be avoided, but when it happens, specific measures must be taken to address the situation. The objective is to develop a sufficiently mature definition of the new project and its execution plan while not disturbing the rest of the project. This requires a separate taskforce to be setup and managed, producing a sufficient level of definition, and a clear transition and change plan for the moment where the pivoted project will be revealed to all contributors. Failure to maintain confidentiality, to achieve a sufficient level of maturity for the pivoted project or to address change management properly, will have strong negative impacts on the project. Discover more in our new White Paper 2023-12 ‘How to Pivot during the Execution Phase of a Large Complex Industrial Project’
If you can’t access the link to the white paper, copy and paste the following link in your browser: https://www.projectvaluedelivery.com/_library/2023-12_how_to_pivot_project_in_execution_v0.pdf
