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Shipyards: Fast and Complex Projects

Normally when you read information on project management websites, magazines, among others; the type of projects mentioned on it usually are related to other sectors than shipyard such IT, Oil & Gas, Infrastructure and construction. Hereby I would like to show to whole community of Project Management that exists other types of industries where challenging, “fast and complex” projects are carried out like in shipyards.

On this article you will find what a shipyard is, the type of projects related to this industry and the way Project Managers carry out the project management at shipyards according my perspective.

What a shipyard is?

Shipyards and dockyards are places where ships are repaired and built. These can be yachts, military vessels, cruise liners or other cargo or passenger ships. [1]

That’s right!, a shipyard is the place where you have the facilities, personnel and the equipment necessary for shipbuilding or ship repair. Actually there are about 2.509 shipyards around the world. [2]

This article will be focused on the ship repair industry.

Why a ship needs to be repaired in a shipyard?

All the vessels need to be registered with a Classification Society. A classification society is a non-governmental organization that establishes and maintains technical standards for the construction and operation of ships and offshore structures. The society will also validate that construction is according to these standards and carry out regular surveys in service to ensure compliance with the standards. Classification societies set technical rules, confirm that designs and calculations meet these rules, survey ships and structures during the process of construction and commissioning, and periodically survey vessels to ensure that they continue to meet the rules. Classification societies are also responsible for classing oil platforms, other offshore structures, and submarines. This survey process covers diesel engines, important shipboard pumps and other vital machinery. [3]

If the ship has en emergency or damage on the main equipment; or as per Classification Societies request; all the ships have to go to the shipyard in order to repair, do some maintenance, or to renovate the class certificates to guarantee that the vessel can sail, transport the cargo, transport passengers or the purpose the vessel has been designed.

Right on this moment, shipyards are they key players due to, they have the facilities and equipment to take the vessel out of water through a floating dock, dry dock or synchrolift in order to repair or inspect the vessel.

The projects carry out on a shipyard can be repair projects, modifications & engineering or conversions projects from one type of vessel to another to satisfy the needs of the market. The main deliverables that a repair project can have are as follows:

  • Hull, tanks and decks surface preparation and painting
  • Main Engine and Generators maintenance and repair
  • Steel renewal on hull, tanks, deck, among others
  • Steering and propulsion system maintenance and repair
  • Tank cleaning
  • All ship’s systems valves and pumps overhauling (pneumatic, hydraulic, ballast, etc.)
  • Piping renewal for any ship’s system
  • Navigation and safety systems repair
  • Among others

Normally a vessel get into the shipyard for repairs or maintenance, this can take between 10 days and 2 months depending on the repair scope. Conversion projects even can take up to 1 year.

Project Manager role at ship repair projects

Can you imagine all the planning and monitoring & control that a Project Manager have to carry out in one of this type of projects?

Each Project can cost between USD$500.000 and USD$10 million in just 10 days or 2 month; you could have at least 500 lines on the Ms Project schedule to track and control; around 100 or 200 workers onboard executing different types of works (i.e. Blasting, painting, steel renewal, cleaning, mechanical, piping, etc); the project could have at least between 5.000m2 to 15.000m2 to blast and paint; you can renew up to 180ton or more of steel, renew a kilometer of pipes or cables; you can change a ship’s main engine with a weight of 30tons; you can withdraw, repair and install the ship’s propulsion system (shaft and propeller) and it can weight from 15 to 30ton x 15m long; among other amazing jobs that can be done on this type of projects at shipyards. Each ship that enters drydock can have between 20m to 400m long, from 10 to 50m wide and from 5m to 30m height (compared with a 5 to 8 floors building)

The Project Manager is a key player on this type of projects for the coordination and planning of those Jobs with the Production Departments and subcontractors in order to avoid interference and delays on activities such as Painting, welding, mechanical jobs, electrical, piping, transport, rigging, scaffoldings, procurements, etc.). Each shipyard has their own way to manage projects, but normally the Project Manager has the free will to use their own tools or methodologies, particularly I use the PMI approach.

The Project Manager handles a lot of pressures from two sides, one is related to shipyard management that is willing that your Project finish on time and with expected profits; from the other side the customer expects that you give the best from you and your team, in such way his vessel can be repaired on time and on budget to start operations. An idle vessel can cause considerable economical losses (e.g. from USD$5.000 to $200.000 daily) and the shipyard will have losses due to the opportunity cost, that’s why this kind of projects are “Fast and Complex”

A ship repair Project Manager can repair an average of 15 to 25 ships per year, even can handle 2 projects at the same time.

Coming up next I will explain briefly how the project management is carry out on ship repair projects matching it with the PMBOK Project Management Process groups. [4]

Initiating

A ship repair Project begins when the commercial department sends the initial quotation of the Jobs and repair specs to the Project Manager. He takes a look on the scope, risks and costs.
At this point the vessel has not arrived to the shipyard.

Planning

Once the initial quotation and repair specs are reviewed, the planning starts. The Project Manager analyze every job together with Production Departments (Normally shipyards has matrix organization) in order to identify risks, doubts, resources needs, quality requirements, time estimation, constraints and priorities; with this information the Project Manager creates the WBS (Work Breakdown Structure) and the draft for the schedule without setting a base line.

The planning of the project has not finished because it is necessary to wait for the vessel enters into drydock to clarify the real scope, this is due that there are some jobs and/or vessel main equipment that are below water line and you can only inspect them when vessel enters drydock.

Ship has not arrived yet to shipyard. Prior to vessel arrival, the Project Manager hold a “Kick off meeting” with the Superintendent or Client where is discussed and passed through the initial quotation and repair specs in order to determine which jobs will be carried out (deliverables), additional jobs, constraints and doubts clarification. With this information the WBS, schedule, costs and risks are adjusted accordingly without setting any base line.

In this phase the Project Manager determine which jobs can be done by shipyard personnel and which one will be subcontracted, this applies for materials and services.

Executing

At this point the vessel finally arrives to shipyard and everything is arranged to accommodate vessel into drydock. Once the ship enters drydock a “Meeting Onboard” is hold, where all the main stakeholders from shipyard and Client/crew introduce themselves, shipyard explain all the safety regulations to be followed during the project to vessel crew and a brief summary of the project is mentioned for final clarifications. After this meeting the Project Manager, Superintendent and the supervisors go for onsite job inspections. With this inspection all the assumptions are cleared, jobs and scope confirmed in such way WBS, Schedule, Cost and Risk are base lined.

Jobs start immediately according to the schedule.

Monitoring and Controlling

This is one of the most important phases for the Project Manager, at this moment all the production departments and subcontractors are executing all the jobs according to Schedule. Here, the Project Manager must follow in detail all the activities of the critical path, must control man hours against estimated man hours and make cost forecast, must control change management, quality control, safety control, risks management and provide a nice customer service. The Project Manager must walk around the jobs daily together with project team, and make inspections with Superintendent/Client for additional jobs.

The EVM technique is crucial for the Project Manager at this stage for cost control. Normally should be set monitoring dates every 2 days for projects between 8 and 15 days in duration. Man hours forecast is crucial in order to take corrective actions.

During this phase the Project Manager reports in daily meetings the progress and plan to the Superintendent / Client.

Reports are given to shipyard management in a regular basis regarding time and cost control.
Every deliverable finished must be deliver it to Superintendent / Client for his acceptance.

Closing

During this stage the Project Manager must negotiate the final invoice with the superintendent / client, here is where negotiations skills must be applied. The project is becoming to the end and the vessel must departure without any delays. After this all the files must be closed, resources must be released, profits analysis must be done and to close bills with contractors.

Conclusion

With this article you could realize what is the job of a Project Manager in ship repair projects, what a shipyard is and why ships must be repaired. This is a very challenging job. Not so easy to carry out but very fascinating, every project is different one form the other; you meet people and cultures from every part of the world.

References

[1] http://en.wikipedia.org/wiki/Shipyard

[2] http://www.ship2yard.com/area_all.php

[3]http://es.wikipedia.org/wiki/Sociedad_de_clasificaci%C3%B3n

[4] Project Management Institute. (2013). Project Management Processes. A Guide to the Project Management Body of Knowledge (PMBOK guide) – 5th Edition(52). Pennsylvania, USA: Project Management Institute, inc.