Modern Project Management Techniques for the Environmental Remediation Industry

Timothy J. Havranek

• Publisher: CRC Press
• Year: 2017
• ISBN:
  9781351430517
• Edition: 1
• Topic: Biological Sciences
• Subtopic: Environmental Science
• Index: Biological Sciences

Environmental remediation has brought significant improvements to industrial sites and surrounding communities throughout the nation. It's also become notorious for high budget overruns and frequent schedule delays, as environmental remediation's technological aspects become subject to political, managerial and economic concerns.
Modern Project Management (MPM) Processes offer a new framework for remediation programs, geared to increased efficiency and precise troubleshooting. Environmental consultant and certified project management professional (PMP) Timothy J. Havranek has helped various companies put MPM into practice: now, he brings his techniques to the environmental remediation industry at large.
Melding traditional project management structure and advanced strategic planning techniques to the needs of environmental remediation, Modern Project Management Techniques for the Environmental Remediation Industry presents this major innovation: a standardized planning process, applicable to all types of remediation projects.
Every participant in an environmental remediation effort can mutually benefit from Modern Project Management Techniques for the Environmental Remediation Industry.
Environmental consultants will discover precise budget and schedule-planning skills-quite an advantage in their increasingly competitive industry. Customers will also know what to consider when selecting an environmental services company, and discover advanced methods for reducing project costs and durations.
MPM: it's bringing new vitality and purpose to environmental protection. Put it into practice with the benefit of Havranek's real-life experience.

Introduction

1

The term environmental remediation refers to the performance of engineering/construction projects designed to remedy or restore environmental media, particularly soil and groundwater, degraded by chemical compounds (or elements) that may pose a threat to human health and the environment. Most companies that manufacture a product or provide a service handle chemicals or produce waste materials which, under certain conditions, may pose a threat to human health and the environment. The various ways by which hazardous chemical products or waste materials have entered the environment include:

■ Accidental releases or spills during loading, transportation, and unloading operations

■ Improper handling, storage, and disposal at times when the potential hazards associated with various materials were not well understood

■ Leaks from aging or deteriorated equipment such as underground storage tanks and their associated piping

■ Intentional release due to unsophisticated or unethical business practices

The discovery of sites such as New York’s Love Canal and Missouri’s Times Beach in the late 1970s and early 1980s raised public awareness and concern about hazardous waste sites to an all-time high. The federal government responded with the development of new statutes such as the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) (also known as Superfund) and enhanced or increased enforcement of regulations already in place under the Resource Conservation and Recovery Act (RCRA), the Toxic Substances Control Act (TSCA), and the Clean Water Act. At the time that the CERCLA, RCRA, and TSCA regulations were developed, it is safe to say that few individuals (if any) truly understood:

■ The number of sites that would be discovered

■ The technical challenges to be faced

■ The amount of money that would be spent

■ The size of the industry that would be created

1.1 ECONOMIC IMPACT OF ENVIRONMENTAL REMEDIATION

As the 1980s wore on, public concern over the heath effects of hazardous waste sites was rivaled only by concern over the cost to clean them up. Billions of dollars were spent during the 1980s for remediation of hazardous waste sites, yet by the end of the decade only a small fraction of the known hazardous waste sites had been adequately addressed. Concern increased further as respected news media began to report in depth on the problem. For example, in May 1991, the Wall Street Journal reported that the future cost to clean up hazardous waste sites under the federal government’s Superfund program could range between $600 billion and $1 trillion.¹ Superfund was initiated to provide government funding to clean up hazardous waste sites when the responsible parties could not be found or, if identified, could not pay for their portion of the cleanup.

Cost concerns were not isolated to the Superfund program. During the 1980s, privately owned and operated industrial facilities involved in the treatment, storage, and disposal of hazardous chemicals were commonly found to have confirmed releases of chemicals to the subsurface. These facilities are governed by the RCRA regulations. In 1987, the General Accounting Office indicated that nearly 5000 RCRA facilities had known chemical releases and that an estimated 50% of those facilities would require remediation to protect human health and the environment.² The RCRA program, like the Superfund program, expended many millions of dollars in the 1980s, but few sites were remediated.

For many corporations, the cost of remediating their contaminated sites for which they have been named as a potentially responsible party may very well be their largest unrecorded liability.³ This can make contingent environmental liabilities the most significant unavailable piece of financial information for a corporation’s existing or potential shareholders, creditors, employees, management, and other users of the corporation’s financial information.³ As a result, the U.S. Securities and Exchange Commission (SEC) and the Financial Accounting Standards Board have demanded responsible recognition and disclosure of environmental liabilities. The SEC has promised enforcement for noncompliance. In June of 1993, the SEC issued Staff Accounting Bulletin No. 92 (SAB 92), Accounting and Disclosures Relating to Loss Contingencies.³ As corporations work to comply with SEC requirements, the extent of corporate liabilities for environmental issues is becoming clearer. In 1997, the McKinsey Quarterly reported that corporate environmental liabilities in the United States stood at $250 billion.⁴

Due to the widespread publicity that many of these sites received, the large amount of money that was spent, the amount of time that passed, and the few tangible results that were identified, the impression among Congress and the public in the early 1990s was that more time and money are spent on litigation and studies than on the actual cleanup.⁵ For the 1980s and early 1990s, this impression may be true. The New York Times reported in its April 26, 1992 issue that of the $470 million that insurance companies processed in 1989 on Superfund-related claims, $410 million went to legal costs to defend their policyholders and dispute whether their policies covered the cleanup costs.⁶

In Chapter 2 of this book, the various factors that complicate environmental remediation projects and increase project costs are discussed in detail. However, as indicated above, the complicating issues are not all technical; they involve legal, political, and economic components as well.

1.2 THE ENVIRONMENTAL REMEDIATION INDUSTRY

Those companies that provide environmental consulting services, site assessments, remediation engineering, construction, and system operation are players in the environmental remediation industry, as are the various analytical laboratories, equipment manufactures, drilling companies, and a host of other service providers. The customers for these services include operators of waste disposal sites and owners of industrial manufacturing operations, oil refineries, chemical processing facilities, and commercial retail petroleum facilities, to name only a few. The various environmental laws and regulations that have been developed to ensure the protection of human health and the environment are drivers for this industry.

Since its beginnings, the environmental remediation industry has been complex, dynamic, rapidly evolving, and rich in technical challenge and uncertainty. In the early days, the challenges and uncertainties were considered so monumental that nearly all work was performed on a time and materials basis. Although costs were as much of a concern then as they are now, early on, most site owners and remediation service companies felt that there was little that could be done to control costs or accelerate project completion. In addition, most professionals involved in the early days of the industry felt that it was simply impossible to make reasonable estimates of the ultimate cost and time to complete a remediation project. In fact, many people still believe this to be true.

Fortunately, the industry has evolved a great deal since the late 1970s. A tremendous amount of innovation in site investigation and remediation technologies has occurred. In addition, the environmental laws and regulations which originally gave birth to the industry have evolved, in many cases becoming more pragmatic. However, despite technical successes and positive regulatory changes, the cost to achieve cleanup at any given site continues to remain high. Perhaps of even greater concern, environmental remediation projects have become notorious for their high budget overruns and long schedule delays. This is a problem not only for site owners and environmental service companies, but also the general public since ultimately it is the public that bears the increased costs of government and industry in the form of increased taxes and increased costs of goods and services. Benefits that accrue from reduced project cost and duration will be shared by all.⁷

1.3 THE CHANGING MARKET FOR REMEDIATION SERVICES

Some of the greatest changes in the environmental remediation industry have been in the structure of the market itself. The customers for environmental remediation services have become increasingly sophisticated regarding environmental issues and the services provided by remediation service companies. Many of these customers have become increasingly dissatisfied with high cost overruns, long schedule delays, and the apparent lack of direction commonly associated with remediation projects. In an attempt to control costs, these customers have adopted more stringent procurement techniques and types of contracts. Time and materials contracts are a thing of the past. Unit cost and firm fixed price contracts are becoming the rule, and many site owners are seeking environmental service firms that will commit to lump sum cost to completion. In general, customers are in search of straight answers to tough questions such as:

■ How can we improve project performance?

■ How can we ensure that we have the best overall strategy to achieve site cleanup?

■ How much is it ultimately going to cost to clean up this site?

■ When will this project actually be finished?

Those remediation service companies that can provide answers to these questions will achieve the greatest level of success in what has become a highly competitive marketplace.

A brief history indicates how rapidly the environmental remediation services market has changed. In the mid-1980s, the environmental remediation industry was gaining much momentum. At that time, the environmental service industry was the talk of Wall Street, as stock values for the entire sector continued to climb. A shortage of environmental professionals occurred as traditional engineering and construction companies made efforts to enter into what appeared to be a lucrative market. By the late 1980s, a full-scale boom was in swing; environmental professionals with only a few years of experience could command highly competitive salaries, with new job opportunities appearing all the time.

Unfortunately, the tremendous boom experienced by many remediation companies during the 1980s has been replaced by increased competition, reduced profits, and in some cases corporate downsizing. Most environmental service companies are in search of new ways to survive and prosper in the new market. This means that companies must learn how to realize a profit in the face of lower billing rates and fixed price contracts, even though the technical complexities and uncertainties associated with remediation projects have not significantly diminished.

The solutions that industrial/commercial site owners and remediation service companies (as well as the regulatory agencies and the public in general) are looking for can be found in modern project management techniques. Although there will continue to be advances in investigation and remediation technology, it is unlikely that a silver bullet “do-all” technology will be found. The area for significant cost savings will be found more in the management of technology implementation than in the technology itself. Therefore, industrial site owners will want to ensure that the environmental service companies they hire are skilled in modern project management processes.

In a similar fashion, although it is possible for a particular company to realize improved profits from the introduction of a new investigation or remediation technology, it unlikely that a sustainable business can be built on a particular technology innovation. This is not to discourage innovation but only to point out that as environmental service companies struggle to find new ways to survive and prosper in the new market, the answers they are looking for are to be found in improved project performance achieved by implementation of modern project management processes.

1.4 WHAT IS MODERN PROJECT MANAGEMENT?

The idea that project management is a distinct discipline, with its own body of knowledge, representing a profession in its own right, may be new to some, in particular to those whose training and background are geared to scientific understanding and technical development rather than coordinating and directing the activities of others to meet predefined goals or objectives. To such individuals, it may seem curious that the adjective “modern” is utilized since it implies that there is a more traditional form of project management, which has in some way been transformed and improved upon. This is indeed the case.

What is referred to as traditional project management had is beginnings in the defense and aerospace industries and came to be utilized heavily in the construction industry as well. Traditional project management is characterized by a focus on three main areas: cost, schedule, and achieving specifications. Modern project management, on the other hand, has a much broader range of focus, dealing with issues of quality, risk management, human resources, leadership, organizational structure, and information systems (to name only a few).

Project management as a distinct discipline and profession has been developing since some time in the late 1950s. Like the environmental remediation industry, it is relatively young when compared to disciplines such as geology, biology, engineering, accounting, and classical management. In the latter part of the 1990s, the issues of concerns for the profession are related to:

■ Corporate implementation of modern project management processes and information systems

■ ...

Table of contents

• Cover
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Preface
• Acknowledgments
• About the Author
• 1 Introduction
• 2 Strategic Issues in Environmental Remediation
• 3 General Project Management Concepts
• 4 Reviewing Requests for Proposal
• 5 Assembling Project Teams
• 6 Developing a Work Breakdown Structure
• 7 Network Diagramming/Scheduling
• 8 Assigning Resources/Cost Estimating
• 9 Earned Value Analysis
• 10 Advanced Project Planning and Risk Management
• 11 Implementing Modern Project Management
• 12 Conclusion
• Appendices
• Index