Document Detail

Title: FR-UMM-01 - Achieving Higher Levels of Facility Standardization in the Upstream, Midstream, and Mining (UMM) Com
Publication Date: 12/1/2019
Product Type: Final Report
Status: Tool
Pages: 215
Offers four solution elements to help industry participants in the UMM sector to recognize the economic value that depends on facility standardization, and to prepare to exploit higher levels of standardization. This publication is accompanied by an Excel-based Standardization Decision-making Model that helps users consider the benefits, drivers, risks, and impediments of facility standardization.

NOTE: This publication's accompanying beta software is a proof of concept and is available for informational purposes only.

By downloading or purchasing this publication, you understand and accept that its accompanying software may stop opening or running properly on future platforms and is not supported or maintained by CII.

Both the publication and its software are protected by applicable copyright restrictions as set forth by CII.

Any party interested in adapting this software is invited to contact CII Associate Director for Deployment to discuss licensing.
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Previous CII research has recognized the shipbuilding industry for successfully achieving high levels of both facility standardization (the development and use of consistent designs for regularity and repetition) and modularization (the large-scale transfer of stick-built construction effort from the jobsite to fabrication shops or yards). As a result of these practices, the shipbuilding industry has reaped considerable benefits, such as “design once, reuse multiple times,” design and procurement in advance, and acceleration response to schedule needs (CII 2007, 2011). Additionally, CII Research Team 283 (RT-283) found that levels of facility standardization must be substantially increased to maximize modularization benefits on capital projects (CII 2012).

Although the level of standardization in shipbuilding is sufficient to reap considerable benefits, the level of facility standardization in the upstream, midstream, and mining (UMM) commodity market falls short of the desired criteria. When the UMM market better understands and recognizes the value of facility standardization, its use of standardization is likely to increase. The industry must better understand the economic value of facility standardization and approaches. Further, the industry needs to learn when and how to analyze and justify standardization, and how to exploit its benefits to achieve higher levels of facility standardization in the UMM sector.

To reap the maximum benefits from standardization on capital projects, the CII Upstream, Midstream, and Mining Sector Committee (UMM) challenged Research Team UMM-01 (RT-UMM-01) to address an essential question:

“How can higher levels of facility standardization be achieved in the UMM sector?”

In response to this research question, the team developed a pyramid consisting of four solution pieces:

  1. The Economics of Standardization – This solution piece gave RT-UMM-01 an understanding of the fundamental benefits and trade-offs with facility standardization. The team used a qualitative survey to collect data from eight standardization programs that had 43 projects in total, and then conducted case studies. Overall, the eight programs saved 10% of the total installed cost, 25% of the lifecycle cost, and 15% of the schedule. The standardization case programs also showed that cost effectiveness, agility, predictability, safety, quality, and schedule objectives often exceeded expectations. The team’s investigation of case programs identified obstacles to gaining the full benefits of standardization, including change of leadership, change of project management, change of project team, change of scope/design, change of supplier, implementation in different regions, and different operation and maintenance teams.
  2. Standardization Decision-making Model – RT-UMM-01 developed a model that provides an early, high-level, systematic review of key issues in standardization. The team also developed a user-friendly Excel tool based on the developed model. The model/tool helps decision-makers identify benefits, impediments, business drivers, and risks, and facilitates education and alignment in facility standardization.
  3. Critical Success Factors and Enablers – The researchers identified 15 critical success factors (CSFs) for standardization, quantified the impacts of each factor on standardization efforts, examined the extent of their use, and made recommendations to achieve higher levels of facility standardization in the UMM sector. The CSFs and enablers complement both the Economics of Standardization (Solution Piece #1) and the Standardization Decision-making Model (Solution Piece #2). The CSFs and their enablers guide project teams pursuing facility standardization. Early implementation and teamwork are especially essential to make standardization successful.
  4. Innovative Technologies and Management Approaches – The team identified and examined new technologies and management approaches potentially related to standardization, in order to help reveal innovative future “stretch” practices and promote outside-the-box thinking.

These four Solution Pieces will help the industry better understand and recognize the value of standardization, and teach industry participants to exploit the benefits that are available by achieving higher levels of facility standardization in the UMM sector.