Risk Management

Along with the perennial risks that attach to projects (for example, those that flow from the prototypical aspects of design or importing materials overseas or unforeseen ground conditions, systemic issues with process or organization), stringent regulatory requirements and diverse stakeholder groups exacerbate complexity and thereby magnify project susceptibility to cost and schedule over runs. At Meme Volens we understand the benefit of quantitative risk management. Properly done, risk management is a complete life cycle, early-warning process that will facilitate:

• Realistic cost and time targets and increased out-turn certainty
• Increased capacity to recognize and capture opportunities
• Control of external risks
• Decision audit trails
• Resilience to the cumulative effects of multiple, minor unplanned events

Our risk process begins at project inception and continues past operational readiness and into production. Our methodology models the risk information collected from project team and stakeholders. We bring our expertise and experience to tease out and test the tacit knowledge within the team. Crucially, our methodology provides a sound basis for decision-making, audit trails and accountability.

Innovation: Schedule Risk Analysis – Master Control Scheduling

To assist with feasibility determination and project sanction decisions, Meme-Volens, in conjunction with its client partners, has developed a Master Control Schedule (MCS) Planning and Risk Analysis method. This method provides risk assessment in advance of the production of detailed schedules.

The key lies in recognizing that planning and scheduling are discrete functions. Through control nodes, the methodology integrates a workflow-based Activity Diagramming Method (ADM), a Master Control Schedule and execution schedules. Control nodes are events or milestones common to discrete discipline or work-area schedules. Once identified, the control nodes are modelled in a control level CPM network (the Master Control Schedule) suitable for stochastic analysis. Because the control nodes are dependency-linked to key milestone events in the discrete discipline and work-area schedules, contingency can be transferred directly to the execution schedules.  With each execution schedule update, control node actual and forecast dates are transferred back to the Master Control Schedule, thereby providing continuous schedule risk assessment as the project is implemented.

Dispute Management

Even well run projects can encounter conflicts and contractual claims, typically these stem from:

• Claims for extras and their impact on the contract cost and schedule
• The impact of late or incomplete design
• Late receipt of “free issue” material and equipment or issues with nominated suppliers
• Inadvertent acts of “active interference”
• Undisclosed or discovered site conditions and
• High cost but ineffective schedule recovery plans

We provide a full compliment of dispute resolution services, at one end of the spectrum we provide position papers for negotiated settlements and not infrequently negotiate on behalf of our clients; at the other end we give expert testimony in court and arbitration hearings. Between them, the two principals of the company have more than 50 years experience of defending and advancing claims in construction and engineering related disputes in a broad range of sectors.

We recognize that our clients are looking for value. For this reason, we tailor our approach not only to best deal with the substantive issues but also to the parties’ budget and appetite for arbitration or litigation (if any).

Meme-Volens will not recommend pursuing or defending a claim unless to do so is viable and economically prudent for you and be assured, should documents and matters come to light that require a change in strategy, we will devise and implement the requisite changes.

Our mission is to resolve your issues expeditiously and cost effectively and in a manner that meets your business exigencies.

Innovation: Stage-Gate Analysis

To assist in establishing a business case for negotiations, Meme Volens’ conceived, developed and tested a methodology that creates an auditable negotiating arena for settlement purposes. Based on the governing agreements, project documentation, interviews and heuristics, Meme-Volens’“Stage-Gate Analysis” uses a probabilistic approach to assess the prospect of success for the hurdles of event, cause, entitlement and quantum.

The methodology assesses each head of claim for cogency of the contentions and probable quantum. At each stage we determine the points for a triangular distribution of possible determinations by an adjudicator based on our experience of analogous or counterpart claims. The gate value data is then assessed stochastically to produce an outcome probability chart that provides an uncertainty assessment of the entire claim, thereby giving a settlement range to inform the negotiating team.

The method can accommodate less than perfect project documentation. It can be conducted at any stage of a project, for any type of dispute and is rapid. Typically, predictions can be made in a matter of weeks rather than months.

We are now in our fourth year of using our “Stage Gate Analysis” methodology; it has been proved to be invaluable tool as an early indicator of the potential success regarding claims and rebuttals.

Project Management Oversight

As part of its project management oversight service provision, Meme-Volens uses various techniques to assess, monitor and report:

• Project team performance including individual accountability and shared responsibility as well as inter-team and intra-team communication and relationships.
• The completeness and suitability of project delivery processes and procedures, collectively the Project Delivery System or PDS.
• The extents to which those project processes are being applied to cost, schedule and quality monitoring.
• The integration of project process metrics to provide reliable reporting and forecasting

Project Management oversight identifies discrete areas of under-performance with potential to adversely affect project outturn targets and overall success. Meme-Volens delivers independent reports and recommendations to the project team and, or the executive team as required.

Innovation: Project Stability Index

To predict the capacity of the project team to mange project risk Meme Volens uses its Project Stability model. At the feasibility stage of a project, the model output may be used to inform project sanction decisions and portfolio management; once a project has begun, the model can identify deficiencies in the structure and management of the project. For example, it would elucidate any incomplete or missing elements in the PDS, project team competency gaps and dysfunctional relationships; it thereby enables lessons to be learned and improvements to be made whilst the project is ongoing.

From the various facets, characteristics and features of a project, the model uses comparative, historical and qualitative methods and an iterative process to assess project delivery system integrity, team development, project difficulty and inherent project complexity. The indices reflect systemic risk including the level of corporate support and hindrances to organizational effectiveness, along with project specifics such as the prototypical nature of the site, design and logistical complexity, probity of the chosen delivery and contracts strategies, team dynamics and principal–agent issues.

The indices are combined in the following formula to generate the Project Stability Index, an indicator of project success.

Project Stability Index (PSI) = (PDS Integrity) x (Team Development) / (Project Complexity) x (Project Difficulty)

Contract Administration Review & Training

With alarming frequency, Meme-Volens finds its clients uninformed as to the rights, obligations and duties prescribed in their contracts and ill equipped to deal with contract administration and conflicts as between parties.

Through “contract health checks”, Meme-Volens elucidates and minimizes potential pinch points, risks and exposure emanating from clients’ contracts and delivery strategies. In particular, we identify impractical and obstructive administrative processes and make recommendations to ameliorate; occasionally, we are called on to develop entire processes for substitution.

Meme-Volens acknowledges that a good contract is an excellent start for any project. Nevertheless, a contract’s strengths can easily be robbed by poor administration. Over the past ten years we have tracked a Canada-wide trend whereby industrial and municipal owners are over-compensating their contractors due to a lack of a complete understanding of their own contracts and extra-contractual rights. Similarly, we see contractors in all sectors recovering less than a righteous amount for want of proper and persuasive submission and unawareness of their rights.

Instrumental in reversing these trends, the principals of Meme-Volens create “cheat sheets” and deliver bespoke training sessions that deal with the very contracts under which the project team will find themselves working. “Cheat sheets” are self-help tools for use by all project personnel involved in any aspect of contract administration; they distill and collate the commercial obligations, duties and rights under the respective contracts into easily accessible rules and guidance in plain language.

Innovation: Simulation Training

Meme-Volens’ simulation training is designed around the client’s actual forms of contract and its recent projects. We deliver the training through a fictitious set of scenarios, drawn from our extensive experience of construction claims and perennial issues.

Our scenario sets involve the usual parties to the construction process– the owner, consultants, constructors, their supply chains, utility services and lobbyists – and some serious conundrums some which may, at first, appear to be intractable. The scenario sets unfold to precipitate a web of challenges, wherein each decision is material and begets poignant consequences.