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If you have spent your career in the shelter of large, rated companies, you likely have not experienced this problem. Some explanation. By "rated" I mean a company that carries a rating by a Dun & Bradstreet, Fitch, or some other recognized rating agency. Most such companies fund their capital projects through their corporate treasury.
Very long time reader Dene Taylor wrote me a note after last week's column (Week of 9 January 2023 "First Number Uttered") suggesting the second number uttered is the time to complete a project. Mike Higgins offered a similar comment. This is so true and in line with the items I covered the first week of this series, the week of 2 January 2023. I have seen so many schedules blown over the years that they are uncountable. The worst are the rebuild schedules, for they are the ones that take an operating machine out of production for a period of time, endangering the customer base. There is a lot of pressure to make these as short as possible.
Capital project budgets suffer from "first number uttered" syndrome. Whatever project cost number gets to the executive suite first is the one that every decision hangs on. That number may arrive from a back of the envelope exercise, an article read in a trade publication, or some other unresearched source. The corollary to "first number uttered" is, "surely we can beat competitor x's reported costs." More projects have been doomed by these kinds of thinking than any other I have ever known, and remember, we're talking about my fifty-three-year career here.
What continues to amaze me are the stories of projects gone bad. Large, small, makes no difference, there are still for me, after nearly 53 years of watching projects from all sides, reports of disastrous projects. In this time period, experienced and learned people have brought forth courses, books and institutes to tackle the subject of project management, yet my side gig of being an expert witness in construction lawsuits continues to thrive. These are the top five reasons I think capital construction projects fail...
The 10,000-pound elephant in the room is that old digester that you abandoned in place. Or maybe it is an old paper machine, or an old bleach plant. Managers have gotten really cute about abandoning old equipment in place rather than take a write-down. The error in this is that one has no idea what kind of energy consumption or fluids consumption (water, lubricants and so forth) are taking place in that abandoned unit operations.
The first energy crisis started within four months of my graduating from college. You might say I, and anyone younger than me, has spent their entire career energy centric. Yes, at times energy became relatively less expensive than at others, but it was always there.
I think my long-term proclamation that all energy is political (which is proven true every day in the popular press), licenses me to wander a bit from our normal management and technical topics here as we attempt to figure out how to get the pulp and paper industry through this coming Northern Hemisphere winter.
In May of each year, we talk about Energy Trends, and we wrap up in December with Power & Energy. Energy is an important topic in the industrial and post-industrial world. As I have said many times, modern energy is all politics. It doesn't help that most politicians and journalists did not go to STEM schools for their secondary education.
So, what have we learned from this series of columns?
Discerning when to be innovative or not is just as important as the art of innovation itself.
Be creative, but make sure you are creative from many points of view. Additionally, don't get hung up on your idea, there may be a better one.
I think anyone can train their brain to be creative. It is a matter of recognizing and knocking down the subconscious mental barriers in your thinking. I believe most are not creative because they won't let themselves explore the possibilities. I know this happens to me even though I am aware of this barrier.
I suspect when I started this series four weeks ago and you saw the word quality, you immediately thought about the products or services your company provides. That is normal. However, we first must get our house in order, starting with ourselves, before we talk about the products or services our company provides.
As we talked about attitude last week, you should have picked up some ideas for making sure your customer relations exude quality, but there are a few more items I would like to emphasize.
Generally, I think that a cheerful countenance and an empathetic attitude convey a person of quality, and like I have said in other parts of this series, an aura of quality is contagious throughout your entire sphere of influence.
The modern phone is a miracle device. The downside is that it may expose us in multifaceted ways that are not flattering.
Quality starts at home, and that home is often your home, your car, and your workspace. Organization exudes quality. Ever walked into an automobile dealership? Was it disheveled or spotless? How would you react if you walked into an automobile dealership that was untidy? If we are going to talk about quality, we must start with ourselves in the places we live and work.
Spinning the Invoice Printer
So, you want to be a consultant
Well, after a few days, the Great Mother came back. She did not mention gorging herself and neither did anyone else. Great Mother, "We have gotten very far behind, and our time is almost up. Til, can you come forward and read the remaining cases? If we have time, we will take them up at next year's conference." Til came forward.
The Rats took a break for a couple of days. We found a pond for swimming and had a good time. On the way back to the meeting area, we went past a place where the Big Things eat food that they heat up very quickly. Out behind, there were bins full of discarded food, so we had quite a feast. The Great Mother got sick from gorging herself and was very embarrassed. The Great Mother always takes her role very seriously and is very conscious of her decorum. Gorging herself was out of character. She must have felt quite ill, for when we reconvened the Junior Mother was presiding. "Attention, please!" she called us to order. "The Great Mother is a bit under the weather and has asked me to preside over this session. Today, we are going to quickly look at cases where Big Things threatened the companies for which they work. Clerk, please read the cases."
After a brief recess, the Great Mother called us together again. "What is on the docket for today?"
After three lights, the Great Mother called us together again. "We have heard a particularly disturbing story," she began. "It seems as though the Big Things want to be known for protecting this whole place where we live, but some of them take what they call shortcuts at times. The RBI, or Rat Bureau of Investigation, has been looking into this. I'll let them explain." Phineas Kirby came to the front of the room...
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