Critical Chain Implementation

at
Kattupalli

Introduction
Lot of complexity

Central/State/Local
approvals
Funding issues
50+ vendors/suppliers
Day-to-day sync issues
Geo-political issues
Labor issues
Technology issues
Durations are estimates

Lot of Slack

Waste is embedded in the

project
Possible to do much
faster if proper
methodology is used

Background

L&T decided to set up a Mega Shipyard on the east coast at

Kattupalli, near Ennore north of Chennai in the year 2007. This
facility would undertake building of Defense vessels and also have
the capability to build commercial vessels and undertake repairs.

The project got the management sanction in December 2008.

The

execution team was mandated with target of making the

shipyard operational in the shortest possible time. This was a

daunting task considering it involved setting up marine facilities
(breakwaters,

shiplift,

jetties)

and

land

facilities

(shops,

infrastructure and utilities).

Based

on

our

past

experience

in

implementing

TOC

in

manufacturing, we decided to use it for construction. We chose

Project overview

A INR 1800 crores infrastructure project completed in 28

months
19 Production Shops, with equipment & cranes installation
Associated services (power, roads, sewerage, fresh water, fire-

fighting)
o The 2nd shiplift in India. First is 175 m long, 25 m
3.5
km of Breakwater (completion of forward pass for navigational
wide,
manufactured and commissioned by a foreign
clearance)
company (with over 90% market share) in 25 months
Shiplift
o L&T is the only company in India to design, build and
commission a Shiplift completely in-house (200 m
long; 46 m wide) emphasizing its leadership in
engineering & construction
o Safety First - Throughout the 28 months of
execution, and more than 2.5 million man-hours,
there were zero accidents at site.
o Uncompromised Quality - Internationally acclaimed
Lloyds Registrar of Shipping involved in thorough
inspection from procurement of raw material to final

Shiplift the concept

ANIMATION
VIDEO

Due date importance

Shipyard
Due to large investment of over 1800 crores, interest and the depreciation

would amount to over 1 Cr per day.

Timely completion of the shipyard would enable the yard to bid for large

orders as well as start the revenue inflows.

Shiplift in particular
A common facility between the new-build and repair business streams, as

such it is longer lead time and hence readiness a important consideration.

Enable starting of Repair business for which the market was expected to be

good unlike new build orders.

Summary of results
FK
Phase
3
months

FK
Phase

Sep 2011
Shiplift
commissioned

Plann
ed

Oct 2009
Site activity starts

5 months
recovered through
improved execution

24
months

3
months

Jan 2012
Shiplift
commissioned

Actual

Oct 2009
Site activity starts

28
months
Ban on river sand

5 months of
delays in supply
of plates

3 excessive
monsoons

Heavy manpower
shortage due to
CG

3 cyclones

Hard soil strata at

30-35 m depth

Bought outs
delayed by 4.5
months

Other benefits observed

No fire-fighting
Entire management capacity could focus on one or two problem

areas at a time

As a result, management team had the time to plan

out stages in advance
Various risk mitigation exercises were performed (in addition to

those initially planned) during the course of execution to validate

design and concept e.g. trial integration performed well ahead of
time
Recovery actions were planned out well in advance, trial

processes run and validated to minimize duration of actual

activity

Single core team for PM

Focused on
technical
solutions
Technical
Consultants

Vendors

Contractors

President, L&T
HED

Focused on
managing
schedule

Key
Management
Team

Realization
Director

Finance/ Legal

Project Team

Realization
Site team

Operations/
Supply Chain

Planning Ensure Critical Chain rules

Reviews Project true delays and
priorities
Monitoring Full kit completions
Alignment of contractors
Enforcing right resource allocation on
ground
Driving Task Preparation on ground
Recovery Driving recovery plans
Look out for upcoming problem areas
Time study and critical process
improvement

HR
Marketing
and
Sales

Critical Success Factor - 1

Create the right plan ensure buffers at the right places

Shiplift Civil Works
Shiplift Civil Works
Platform Fabrication
Platform Fabrication

Platform Erection
Platform Erection

Hoist Erection
Hoist Erection
Transfer System
Transfer System
Commissioning
Commissioning
Transfer System Manufacturing
Transfer System Manufacturing

Hoist Manufacturing
Hoist Manufacturing

Commissioning
Commissioning

Full Kit for commissioning

Platform Fabrication
Platform Fabrication
Shiplift Civil Works
Shiplift Civil Works

F
BF
B

Hoist Manufacturing
Hoist Manufacturing
Transfer System Manufacturing
Transfer System Manufacturing

Platform
Platform
Erection
Erection
FB
FB

Hoist
Hoist
Erection
Erection

Commissioning
Commissioning

Commissioni
Commissioni
ng
ng

FB
FB

Low WIP plan with buffers for risk mitigation

PB
PB

Critical Success Factor - 2

Apply lean on Critical Chain maximize improvement through

time study

Project requirement: 40 rows of piles to be driven in the sea (length of

each pile 50m)
Uncertainty faced: Hard strata at 30m-35m depth
Planned cycle time was 5 days, achieved was 12 days
Improved Piling rigs could only get us a 10 day cycle time
We were staring at a 200 day delay on the project

Time Study on piling showed cycle time can be improved to 7 days

Quick implementation of improvement actions cycle time brought
down to 7
Investigated spare capacity in available equipment
1 month of Jack up rig support employed to reduce cycle time on 15
rows to 6
Stable process created with a known delay of 120 days

Project Execution Piling

Works

Critical Success Factors 3

Control open work fronts challenge cycle times, avoid

Delay discovered
27
projected: 100+
multitasking
days
Required Welders: 130, Mobilized
number 75-85

Actual
time:
7043
Planned
time:
days +

Ensure completion
Actual duration: 70 days
70 days recovered

Do not start more

40 days
33 days
30 days
27 days

Module Assembly in
batch of 3

Critical Success Factor - 4

Acknowledge project risks and mitigate them

Initial plan

Platform
erection

Platform
erection

Revised plan due to

delays

Hoist Erection

SL
commissioning

SL
commissioning

HE for 13
mod

FK

All known risks

absorbed here

PE of 13
mod
HE for 13
mod

PB

SL
commissioning

PE of 13
mod

Further delay on BOs

Plan executed

Hoist Erection

SL
commissioning

All unknown risks

absorbed here

Project Execution Risk mitigation

Load Test Rig 3500 Tons

Results Achieved
(pictographical)
Crisis faced due to cycle time
increase in Marine Piling: Advance
Warning signal

Project brought back through

de-bottlenecking efforts 1.
Lean methodology applied on
top constraint 2. Additional
equipment mobilized to
accelerate execution

Scope
increased to
200m and
timeline
extended

Controlled execution by the

following methods:
1. Multiple entities met and
planned out activities 15 days
prior to execution of tasks on top
chains
Ensured co-ordination,
availability of material and
resources
Enabled resource
concentration in right areas
No delay in project
despite resource shortage
all over
2. Top management met project
teams regularly on top chains to
drive priorities and set
aggressive targets for execution

Shops & Infrastructure

Areas for improvement

The Shops and Associated facilities project consisted of 19 Production Shops

with cranes and equipment installation and associated Services (Roads, Drainage,
Fire-fighting, Electrical, Fresh Water and Sewerage over 150 acres of land)
It was finished within the overall project timeline but we were delayed on all our
internal targets
Though there were a lot of big uncertainties that we faced, we felt that our
application of the solution got compromised somewhere
The main symptom behind our belief was that priorities kept fluctuating and we
were in a fire-fighting mode for the initial half of the project

Shortage of
manpower for PEB
works

Sand not available

3 cyclones

Unanticipated
dewatering
requirements

3 severe
monsoons

Severe cash flow

issues for
contractors

Project comparison
Shiplift

Shops and Utilities

FK completed before starting execution

Designs, Vendor on-boarding,
Integrated plan

FK released at 50% under due date

pressure incomplete designs, POs
pending, high level plan

Management focused on 1 2 areas in

execution no. of open fronts
controlled

High WIP of execution and pending FK;

incorrect sequencing in Services works

Management focused on limited

emergent issues

High number of emergent issues; No

time for preparation

Time available for detailed preparation

and planning for each stage

Management capacity wasted in

chasing missing inputs; no time for
proper on-boarding local plans with
infeasible due dates

Stage-wise FKs planned and executed,

Time studies for faster execution

Too many stuck tasks; fluctuating

priorities

Key Learnings

Implementation is not possible without Top

Management commitment to solution
Compromising Full kit is equivalent to losing
control on project
Without contractor alignment, buffers will be
lost in no time
Even when resources are scarce, delays can
be contained by controlling amount of open
work