News

An abstract with the provocative title "Include Past Project Performance in your QRAs or be overtaken by AI soon!" submitted by Colin Cropley, Managing Director of RIMPL, has been accepted for presentation at the EA/Risk Engineering Society biennial Risk 2023 conference in Brisbane on 7 & 8 September.

May 2023: Colin Cropley invited to speak at Forum Safran 2023 in Norway in November

Following his writing of a White Paper for Safran Software and online discussions on LinkedIn in November and December 2022, Colin Cropley has been invited to speak at the 2023 Forum Safran in Stavanger, Norway in mid-November.

April 2023: RIMPL Risk Factors SRA Course using Safran Risk available through Allinno

RIMPL and Australian distributor of Safran Risk, Allinno Pty Ltd have entered an agreement for RIMPL to provide its SR training to Allinno customers for at least two years. The two day training course providing learning through hands-on workshops progressively takes SR users through importing an Oracle Primavera(R) project schedule file, developing a risk factors-driven schedule model, adding risk events and weather calendars and analysing the model. It includes generating reports and understanding from SRA model output what drives the project and how best to optimise risk.
The course concludes with insights into the next steps that can be taken, including integrating costs in the risk factors model and incorporating past project performance in the risk modelling for greater realism and credibility.

March 2023: P+EV & P+SRA evaluations of cost & schedule contingencies of manufacturing plant

A manufacturing plant project in execution was the focus of an engagement for RIMPL to perform Parametric + Expected Value (P+EV) plus Parametric + Schedule Risk Analysis (P+SRA) risk and contingency assessments in March 2023, in Victoria. The scope was similar to a manufacturing project RIMPL had assessed in recent years.

Workshops were held with the project team at the site. RIMPL used two hybrid methodologies:

JK Hollmann's "top down" P+EV methodology to assess both cost and schedule contingencies and
Combining the Parametric assessment with RIMPL's own P+SRA hybrid Risk Factors approach in Safran Risk.

December 2022 / March 2023: P+EV & P+SRA Contingencies for WA Mining Infrastructure Project

RIMPL assessed cost & schedule contingencies for the Define to Execution Gateway for a transport infrastructure project to access a planned expansion of the area being mined for a WA bauxite mine in December/January.

The hybrid Parametric + Expected Value "top down" methodology developed by John K Hollmann was used to assess cost and schedule contingencies (excluding use of the schedule) for construction of a mining haul truck overpass of a public highway plus associated infrastructure.

Combined Parametric + Schedule Risk Analysis methodology assessed schedule risk based on the project execution schedule. This analysis of across the project scope drove the reported schedule contingency.

Revised inputs to the project estimate schedule were re-evaluated in March.

2022

November 2022: "Modelling Realistic Contingencies" co-published with Safran Software Solutions

A "White Paper" written by RIMPL MD in September is being co-published with Safran Software Solutions (https://www.safran.com/) in November 2022. The paper, available on this website (at https://www.riskinteg.com/knowledge-base/papers-articles#h.p_vpGpxWBE_t6G) will be highlighted in a series of weekly LinkedIn Live discussions between mid-November and the beginning of December. The discussions, between Safran's CEO Richard Wood and RIMPL's MD Colin Cropley, highlight aspects of the paper.

The paper starts with the quest for adequate cost and schedule contingencies and the need to know how likely projects are to finish within budgeted time and cost. It goes on to describe best-practice CPM-based Integrated Cost & Schedule Risk Analysis using the Risk Factors approach in Safran Risk (SR), summarised as Integrated cost & schedule Risk Analysis (IRA).

After noting that the bottom-up IRA methodology has a serious flaw, the paper describes how to include past-project performance in contingency assessment using Parametric modelling of Systemic Risk. The effects of systemic risk are added to the IRA methodology to produce P+IRA hybrid methodology, described in the paper as the best approach for modelling cost and schedule contingencies for large and complex projects.

The results obtained to date from P+IRA and P+SRA are compared with IRA and SRA and lessons learned are described.

August 2022: P+IRA Risk Analysis Recommended Practice published by AACE

RIMPL developed the Parametric + CPM-based Integrated Cost & Schedule Risk Analysis (P+IRA) methodology in 2018, based on combining J.K. Hollmann's P+EV methodology with RIMPL's version of CPM-based Integrated Cost & Schedule Risk Analysis. The key understanding was finding a way to avoid double-counting inherent or background risk with Systemic Risk. The solution was to subtract the Inherent Risk from the Systemic Risk using Monte Carlo Simulation (MCS) subtraction of the Inherent Risk probability distribution from the Systemic Risk Probability Distribution, for each of cost and schedule. The methodology combines past project experience through the parametric modelling of Systemic Risk with the full analysis of schedule and cost uncertainty and risk events with the opportunity to optimise schedule risk and thus time-dependent cost risk.

RIMPL used the methodology on several projects covering Minerals Processing, Oil & Gas and a complex biologicals pharmaceutical plant before presenting the methodology and the results in a paper at the June 2019 Annual Meeting of AACE International in Orlando Florida.

Following encouragement from John Hollmann in 2019, the draft Recommended Practice was subsequently prepared and submitted to AACE in December 2020. The draft RP went through lengthy technical committee and public reviews, before being published on 15th August 2022.
The RP can be obtained from AACE International (https://web.aacei.org/).

RIMPL believes that P+IRA is the most realistic and comprehensive methodology for assessing project cost and schedule. It is most appropriate for major and complex projects nearing the completion of the Feasibility Study phase where good quality estimate and schedule are available. However, it can be applied to smaller projects and the prefeasibility study phase where a realistic project schedule is available, as well as to projects in execution. It can also be applied to Schedule Risk Analyses.

June-August 2022: RIMPL used P+IRA methodology to assess Cost & Schedule Contingencies for greenfields Australian Mine Feasibility Study

RIMPL was engaged to perform Parametric + Integrated Cost & Schedule Risk Analysis (P+IRA) contingency assessments to assess the riskiness of the remote-located megaproject and assist the project Owner to select realistic cost estimate and duration schedule contingencies. Workshops were held online with the project team at the Owner's Head Office and online. RIMPL used the Risk Factors approach in Safran Risk in accordance with its own P+IRA hybrid methodology, incorporated in an AACE International Recommended Practice 117R-21 published in August 2022. The P+IRA analysis was effectively performed twice, as, after the draft final report was submitted, the Owner provided major revisions to the estimate and to the schedule.

May/June 2022: P+EV Contingencies for WA Mineral Process Plant Expansion

RIMPL assessed cost and schedule contingencies for the Select to Define Gateway for the expansion of a major WA mineral processing plant, covering EPCM and Owner's Scopes. The hybrid methodology, developed by John K Hollmann of Valid Estimating LLC, enabled realistic estimates of both kinds of contingencies to be adopted by the Owner for moving into the final phase of preparation for Financial Investment Decision. This followed RIMPL's assessment in 2018 of cost and schedule contingencies for the initial construction of the plant, using the hybrid methodology RIMPL developed by combining Hollmann's Parametric modelling of Systemic Risk with CPM-base Integrated Cost & Schedule Risk Analysis (P+IRA).

2021

September 2021: P+SRA hybrid analyses for Canadian project

RIMPL worked with John K Hollmann's company Validation Estimating LLC in Q2 and Q3 2021 for ValidEst's client in western Canada to produce Parametric + Schedule Risk Analyses (P+SRAs) in conjunction with VE's P+EV cost and schedule contingency assessments. Workshops were held online with the project team over several months covering the sub-projects making up the scope of the complete project.
The Parametric analyses and project specific risk events assessed through the P+EV workshops were combined with the schedule risk factors workshops providing inputs for the program-level P+SRA. The SRA outputs helped the client understand the schedule risk inherent in the various scope components of the project.

July 2021: RIMPL produced P+EV Contingencies, P+SRA for Australian Mine Expansion Feasibility Study

RIMPL was engaged to perform Parametric + Expected Value (P+EV) cost and schedule contingency assessments and to perform a Schedule Risk Analysis (SRA) in parallel to validate the schedule contingency assessed by P+EV and to assess all sub-project milestones. Workshops were held online with the project team. Good agreement was achieved independently between the P+EV schedule contingency and the SRA overall schedule risk using Risk Factors methodology in Safran Risk.

February 2021: RIMPL developing SRA training course

RIMPL is developing a 2-day SRA training course using Risk Factors, based on the use of Safran Risk (SR) Monte Carlo Simulation software application, arguably the most advanced CPM method Integrated Cost & Schedule Risk Analysis (ICSRA) application on the market. The course is being developed and upgraded as Safran Software Solutions AS of Norway upgrades SR.

2020

November 16-19 2020: RIMPL presenting at Virtual PC Expo

RIMPL MD Colin Cropley is presenting on the topic "Innovative Contingency Methods - Overdue for use in big infrastructure builds"

The presentation notes the poor track record of transport infrastructure projects meeting their announced cost and schedule targets in Australia and the slowness of the sector to adopt improved techniques for forecasting more realistic cost and schedule contingencies. It draws on methodologies proven in other more risk-aware industry sectors to recommend their use in the infrastructure sector.

October/November 2020: Oil & Gas Field Optimisation Definition Study P+EV Contingency Assessment for Australian O&G company.

RIMPL performed a P+EV contingency assessment, conducting workshops online with the project team. This was to help enable the project team to obtain approval for execution.

October 2020: Tailings Dam Feasibility Study P+EV & SRA for South32 Ltd.

September 2020: Coal Seam Gas Field Development Definition Study P+EV Contingency Assessment for LNG producer

RIMPL performed P+EV cost & schedule contingency assessments for the Definition Study phase of expansion of a CSG field development. Workshops were held online with the project team.

March 2020: Copper/Gold Mine Expansion P+EV contingency assessment for Australian Mining Company

A Parametric + Expected Value Contingency assessment was performed for the Pre-Feasibility Study phase of the expansion of a Copper-Gold mine for an Australian Mining Company. Workshops were held at the offices of the company.

February 2020: Tailings Dam Feasibility Study P+EV contingency assessment and parallel SRA conducted for South32 Ltd

A P+EV contingency assessment was performed together with a parallel SRA for the Execution Gate review of a Tailings Storage Facility for South32 Limited. The P+EV workshops were held at the Brisbane offices and the SRA ranges for input to Primavera Risk Analysis were collected by the project team under RIMPL's supervision. There was good agreement between SRA and P+EV schedule contingency assessments.

January 2020: P+EV & parallel SRA for BHP Olympic Dam Decline PFS

Cost & Schedule contingency assessments using P+EV were performed for the BHP Olympic Dam Southern Mining Area Declines Project PFS. in parallel a Schedule Risk Analysis was performed to validate the P+EV schedule contingency and to identify schedule uncertainties of key milestones.

2019

November-2019: RIMPL Gold Sponsor of PC Expo at MCG on 26Nov19

RIMPL is again exhibiting and presenting at PC Expo at the Melbourne Cricket Ground.

RIMPL will focus on the value of adopting Parametric modelling (P) of cost and schedule systemic risk in projects to reference past performance and avoid optimism bias. RIMPL's MD Colin Cropley will present on "Experience Forecasting Realistic Time and Cost Contingencies for Large and Small Projects" in the Masterclass zone at 2.10pm. RIMPL's other Directors Matt Dodds and Peter Downie will join Colin in staffing the RIMPL Stand.

November-2019: Preparation of Working Paper on Integrated Cost & Schedule Risk Analysis

RIMPL has been engaged by the Australian Department of Infrastructure, Transport, Cities and Regional Development to prepare worked examples illustrating the use of different methodologies for Integrated Cost & Schedule Risk Analysis (ICSRA). The Department proposes to publish a working paper on such methodologies in 2020 for review and feedback. RIMPL, as a member of the Infrastructure Advisory Panel, has been engaged to support this effort. The examples are expected to use Monte Carlo simulation and to include CPM-based, Parametric and hybrid methods.

October-2019: Review of Cost Time Risk & Contingency Guideline Document

RIMPL has been invited to review a Guideline document being prepared for a state government department that commissions a lot of infrastructure projects. The document addresses gaps in the Identification, Quantification and Management of Cost, Risk, Time (Schedule), and Contingency. It intends to raise the level of understanding of these matters to improve the performance of the department in specifying and evaluating such services.

August-2019: Parametric+Expected Value (P+EV) Contingency assessment for highway re-alignment

RIMPL has been engaged by an Australian mining company to assess time and cost contingency for the re-alignment of a highway using John K Hollmann's Integrated Cost and Schedule Parametric + Expected Value methodology.

The assessment is to be performed early in 2020, once the PFS inputs are finalised.

July and August-2019: P+EV Contingency Assessment & Schedule Risk Analysis for Coking Coal project

RIMPL was engaged in June 2019 to perform a P+EV Schedule and Cost Contingency Assessment using John K Hollmann's Mining Tool and methodology for a central Queensland coking coal project at the conclusion of its Pre-Feasibility Study phase.

In parallel, RIMPL was invited to perform a parallel Schedule Risk Analysis to assess schedule risk on the various intermediate milestones of the project. The work was carried out in July and August and helped the project team understand and optimise its schedule and assess its cost contingency.

July-2019: Parametric + Integrated Cost & Schedule Risk Analysis (P+IRA) Paper presented

The MD of RIMPL presented his third peer-reviewed paper to an AACE International Annual Meeting. Held in New Orleans, the conference featured Decision and Risk Management papers from various parts of the world. The paper explained in detail how the P+IRA methodology works, using a demonstration Tollway project previously used for a paper presented to the AACE Annual Meeting in Orlando Florida in 2017. The P+IRA methodology combines John K Hollmann's Parametric modelling of Systemic Risk (the major source of risk in most projects) with RIMPL's CPM-based Integrated Cost & Schedule Risk Analysis.

Both papers are available on the RIMPL website.

June-2019: Full Parametric + Integrated Cost & Schedule Risk Analysis for Pharmaceutical Project

Following on from work announced here in May 2018, the full analysis of a major pharmaceutical plant project was held from February (when the schedule was carefully reviewed after being migrated from MS Project to Primavera P6) through March when workshops were held and April when initial results were provided.

Further analyses were performed in May 2019 with new optimised inputs and the report finalised in early June 2019. The analyses over the extended involvement were used to optimise both schedule and cost risk and to trim contingency requirements for project funding.

January through July 2019: Parametric+Expected Value (P+EV) Contingency assessments for small mining projects

Arising from its participation in the 2018 Project Controls Expo, RIMPL was engaged by an Australian mining company to perform several small project contingency assessments using John K Hollmann's Integrated Cost and Schedule Parametric + Expected Value methodology. The methodology, well suited to small projects or those early in their development, was used for two tailings storage facilities at Pre-Feasibility Study (PFS) stage plus one at Feasibility Study (FS) stage.

For the FS, a Schedule Risk Analysis (SRA) was also conducted in parallel, using RIMPL's own SRA methodology, to provide more detailed information about schedule risk within the components of the project.

2018

September-2018: QRA of Natural Gas Debottleneck Project

RIMPL was awarded a contract to perform a P+IRA assessment of time and cost contingencies for a Natural Gas processing plant in south western Victoria. The process was conducted during September and October. As well as helping the client to quantify contingencies, the schedule optimisation services RIMPL provided as part of the process helped the project team set the timing for a shutdown and assess the timing for the installation of additional compression capacity.

The analysis supported decision making for the client in commercial negotiations with a customer.

June-18: Support of Visit to Australia by John K Hollmann

RIMPL supported and helped organise a speaking and teaching tour of the East Coast of Australia by John K Hollmann, distinguished Life Member of AACE International, recipient in 2018 of AACE's Lifetime Achievement Award and author of the seminal book "Project Risk Quantification" (PRQ), reviewed by RIMPL in its 2016 Newsletter. RIMPL represents John Hollmann's company Validation Estimating, Inc. in Australia and New Zealand. John presented to Australian Cost Engineering Society (ACES) Chapter meetings in Melbourne, Sydney and Brisbane and met with senior executives in each city. He also taught a three day course based on PRQ at Engineers Australia's Melbourne office, attended by 18 people from the three states, including RIMPL Directors Colin Cropley and Peter Downie. Arising from this training, RIMPL devised a methodology to combine John Hollmann's Parametric assessment of Systemic Risk with RIMPL's Integrated cost & schedule Risk Analysis (IRA) methodology, creating the hybrid P+IRA methodology. RIMPL has been using this P+IRA methodology in its engagements by clients since then.

May-18 to First Quarter 2019: Pharmaceutical Plant project QRA Services Engagement

RIMPL was engaged to deliver Quantitative Risk Analysis (QRA) services to quantify time and cost contingencies for the design, procurement and construction of a major pharmaceutical plant project in Victoria. RIMPL has been supporting this project since the end of 2017 when a first meeting was held. The Critical Path Method based Monte Carlo Simulation assessment of cost and schedule risk is new to the client and an extended QRA readiness process has been occurring through the year.

The process culminated in late November and early December in a trial Parametric + Integrated Cost & Schedule Risk Analysis (P+IRA, see June-18 news item) and delivery of a report. The full P+IRA process is due to be performed in Q1 2019.

April-18 to December 2018: Lithium Project QRA Services Engagement

An order was received by RIMPL in response to a proposal lodged in February to deliver Quantitative Risk Analysis (QRA) services to quantify time and cost contingencies for the design, procurement and construction of a lithium hydroxide production plant megaproject in Western Australia.

The engagement was to have occurred in June, but the client deferred the QRA for three months. The services were delivered in August and September, at which time RIMPL was able to utilise its hybrid Parametric + Integrated Cost & Schedule Risk Analysis (P+IRA) methodology (see June-18 news item).

RIMPL was further engaged in December 2018 to re-analyse the project following updating of the estimate and schedule. Again the P+IRA methodology was used to provide schedule and cost contingencies.

March-18: Defence Support Services Panel

RIMPL was notified by its client Red Bay Consulting that as suppliers of Risk and Issue Management Services, RIMPL is part of a Defence Support Services (DSS) panel. Red Bay are co-developers and providers of the sucessful Schedule Compliance Risk Assessment Methodology (SCRAM) system, developed for defence sector projects to assess such projects and determine the areas where improvement is most needed to recover schedule slippage.

A 2012 Gartner Survey found that "The single most common reason that projects are considered a failure is because they are substantially late."

February-18: John K Hollmann appoints RIMPL to represent him in Australia and New Zealand, coming to Australia

Well-known and respected quantitative risk analysis specialist and author of the important book "Project Risk Quantification", John K Hollmann PE, CCP, CEP, DRMP has appointed RIMPL to represent him and his company Validation Estimating, LLC in Australia and New Zealand. John has given an enormous amount of his professional time to AACE International to edit and contribute to various Recommended Practices, including 10 years of effort in the creation and editing of the first edition (2006) of "Total Cost Management Framework", the systems engineering foundation of all AACE's knowledge base and RPs. More about John is included in RIMPL's review of his book, in our December 2016 Newsletter.

John is particularly keen to educate senior executives about the importance of quantifying project risk realistically and to teach project risk specialists how to perform the Hybrid Parametric + Expected Value schedule and cost contingency methodology described in his book.

To this end, John is visiting Australia in June to deliver a three-day training workshop in Melbourne and address Australian Cost Engineering Society (ACES) professional meetings in Melbourne, Sydney and Brisbane. He will also meet with senior business and project executives in the three cities to explain the significance of quantifying project time and cost risk realistically.

January-18: Gateway Review & Project Audits

RIMPL's distinguished Director of Contracts and Dispute resolution, Peter L Downie has recently completed a Gateway Review for the Victorian Department of Treasury & Finance. This entailed assessing procurement of new trams. It was the second such engagement RIMPL has performed in the past few years.

Peter Downie also conducted a project audit of a significant municipal recreational facility project for a Victorian municipality during 2017. it was the second such engagement in as many years.