|Construction Disputes | Construction Consulting | Management Consulting | Seminars|
Management and Organizational Performance Consulting Engagements
James E. Kelley, Jr., Principal
Yucca Mountain Project, Nye County, NevadaThe Nuclear Waste Policy Act of 1982, as amended in 1987, established the Office of Civilian Radioactive Waste Management within the United States Department of Energy, and directed that Office to investigate a site at Yucca Mountain, Nevada, to determine its suitability for construction of a repository for the permanent disposal of high-level nuclear wastes. By late 1994, work on site suitability studies had been underway for several years and nearly $2 billion had been spent on characterization studies. At that time, the completion of studies was projected to cost over $6 billion by the year 2001, when permitting and licensing activities could begin. (Total system life cycle costs, in 1995 dollars, were then estimated to be in the $35 to 40 billion range for a completed and operating facility.) The project had received (and still does) substantial criticism from a broad spectrum of sources including the Congress, the General Accounting Office, the State of Nevada, the United States Nuclear Waste Technical Review Board, the National Academy of Sciences, the nuclear power industry, many state Public Utility Commissions, concerned individual scientists, and the concerned public at large. As a result of this criticism, Secretary of Energy O'Leary and Nevada Governor Miller entered into a cooperative agreement whereby each would appoint a representative to a "special review panel" to select and oversee the work of a consultant to perform an Independent Management and Financial Review of the Yucca Mountain Project. The National Association of Regulatory Utility Commissioners was engaged by the special review panel to administer the contract of the consultant selected.
Kelley developed the proposed approach to the independent review and served as Project Manager to direct the work. During the eight-month period for the review, between November of 1994 and July of 1995, the following scope of work was performed:
(Confidential Client) Nationally-Ranked, Interior-Finish ContractorA large specialty contractor who focused on interior finish work had the good fortune of doubling in size and revenue during a one-year period and had experienced the associated growing pains. Kelley directed an effort to analyze all aspects of the contractor's business, formulate recommendations for addressing previously unidentified major issues, and develop action plans for improvement. The work included analyses of cost estimating procedures, bids and sales; material purchasing, inventories, and controls; workplace morale; organizational structure to address the potential for continuing growth; budgeting, cost control, accounting, and auditing; incentive compensation; and other factors involved in the client's business. Over the succeeding years, the client experienced controlled growth and substantially improved its financial performance.
(Confidential Client) Electric and Gas Public Utility Company, Southern CaliforniaIn the late 1970s, a large electric and gas utility was investigating the feasibility of conversion of its manually-created-and-maintained distribution mapping and records system to a fully-integrated/automated system of graphic maps and facilities diagrams, and non-graphic system attribute information. Kelley participated in this effort in the following ways:
(Confidential Client) Basic Materials ManufacturerA cement plant was developed by a large basic materials manufacturer in the late 1970s. At the time of design and construction, it was believed to have been the world's largest single-kiln cement plant. From the time of preliminary design development to the completion of construction and start-up operations, the actual construction cost realized was nearly double that of the original estimate, which was already in the nine-digit range.
Kelley was part of a team engaged by the Client's Board of Directors to independently review the financial, management, and technological development history of the project to inform the Board as to the root causes that drove the cost overruns on the project and provide recommendations to be applied to future major capital project development.
(Confidential Client) Oil Shale Project Owner/Developer, Central Rocky Mountain StatesA very large oil shale project located in the central Rocky Mountain region of the western United States was initiated in the late 1960s and was terminated in the early 1980s. The original capital cost estimate for the project was $800 million and the pre-termination cost projection calculated in 1982 was over $6 billion. The project was initially owned by a single entity, which later sold a majority interest to a larger oil company who subsequently sold its interest to another large oil company in 1980. Throughout this time, the original owner retained a 40 percent interest in the project as a minority partner.
Following termination of the project by the majority partner, the minority partner sought an independent identification and analysis of the reasons for the substantial cost overruns and other factors leading to project termination. Kelley served as principal investigator and project manager for this work, which included reviews of cost estimates, summary and control budgets, project development policies and enhancement decisions, and management/organizational tenets employed over the 16-year life of the project. A comprehensive report, which documented the analysis and proposed recommendations for planning and managing future similar-scale capital development projects, was prepared and presented to senior management.
During a follow-on engagement with respect to the second oil shale project, Kelley served as project manager for management planning consulting services, which included the following scope of work:
(Confidential Client) Public Power Supply Provider, Northwestern United StatesKelley substantially participated in two engagements to provide consulting services to the owner of a large nuclear power generating facility under construction in the Northwestern United States. The first engagement called for an independent assessment of the change order procedures employed during construction and the formulation of recommendations to make the procedures more efficient and effective. The second engagement was similar in scope to the first but related to contract closeout procedures. In both engagements, Kelley participated by mapping the flow of work involved in each procedure and applied time factors within and between organizational subdivisions to pinpoint work flow bottlenecks, and serve as the baseline for improvements.