With just over a year to go until the Canadian government’s Strategic Investment Fund (SIF) deadline of April 30, 2018, you need to make sure your project is underway and meeting its milestones.
Tight deadlines are hard to meet at the best of times. But if you experience issues procuring your project’s long lead items, it can wreak havoc on an already-compressed schedule. Long lead items include any construction materials, equipment and systems that need to be designed, customized and fabricated prior to being acquired and delivered to your project site; items that literally require a long lead time.
Long lead items feature in most projects. However, the demand for specialty items such as laboratory equipment, fancy light fixtures and HVAC units may put a strain on the market given the number of post-secondary institutions participating in the SIF program.
Your long lead item delivery schedules can influence the logistics of your project’s critical activities, sometimes even dictating the critical path. Their impact on your project is so important that any delays in delivery will disrupt the flow of work, and could significantly impact your ability to complete your project on time.
The best way to ensure your project runs smoothly is to develop a procurement management plan. Simply put, a procurement management plan identifies the long lead goods and services your project requires and outlines how your will obtain them.
Your procurement process should be logically structured:
- Get organized! Review the project design and specifications documents. Identify any specialty and priority items required for the project; any standard material and performance data sheets; and, any preferred vendors. Capture each item in a tracking log.
- Know the rules of the game! Read the contract documents. Identify any project limitations and understand the conditions of procurement.
- Accuracy goes a long way! Obtain, review and approve submissions promptly. Approaching this process seriously will help you catch errors and avoid delays due to corrections and rework.
- Have a strategy! Identify your project milestones and agree on the delivery methods and time frames for each long lead item. Make sure that the delivery sequence matches your needs outlined in the overall project schedule. Have a strategy in place for critical items to prioritize and expedite their manufacture and transportation to meet project milestones.
- Get a head start! Issue purchase orders or contracts for long lead items as early as possible. Could they be pre-ordered during the design phase? Pre-ordering does involve several inherent risks but it can save a critical schedule if done properly.
- Be proactive! Closely monitor your suppliers’ progress and identify and resolve performance issues promptly. Use your tracking log to monitor periodic status updates from the suppliers and flag any potential delivery issues.
Ideally, your materials, equipment, systems and other resources will be delivered exactly when your project schedule calls for them, keeping the flow of work going. Realistically, unforeseen and unplanned factors – inclement weather, material and labor shortages, labor disputes, plant maintenance and shut downs, work order backlogs, etc. – may come into play and, if Murphy’s Law is anything to go by, the likelihood that these issues will creep up at the worst possible moment is high!
Scheduling your long lead item procurement is a balancing act of “just-in-time” and “just-in-case”. If you focus too much on “just-in-time” deliveries, you must consider the risk of material shortages and project delays against the increased likelihood of meeting the SIF program’s substantial completion date. And remember, non-critical items may become critical as project strategies and priorities evolve. On the other hand, being too careful (“just-in-case”), while avoiding material shortages, can cause site congestion and productivity loss, as well as issues with storage availability and security coordination.
SIF Certainty is within your reach! An experienced Project Manager with knowledge of current market conditions can help you balance your procurement approach and get you there. Colliers Project Leaders is here to help.