Oil and Gas
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About Our Courses
NDO Training is part of NDO Consultants Ltd. www.ndoconsultants.com
Registered in England, Company registration 06380325
VAT Registration 924160447
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Commercial Training Courses
Commercial Awareness, Earned Value and Risk Analysis & Management
The generality of the title of this course perhaps does not do justice to the wealth of information provided by it. In
essence it is a complete introduction to all aspects of commerce and business, from the content, construction and
administration of a contract, through development of business, proposal writing, estimating, costing, pricing,
negotiation and programme and cost control and management.
The importance of specifications, work breakdown structures, linked logic networks and Work package cost
collection systems are explained. The delegates will understand the development and maintenance of contracts and
how to answer Requests For Quotations (RFQ), Invitations to Tender (ITT) and Request for Proposals (RFP),
including the management and construction of RFP's including the approvals process.
Negotiation techniques will be demonstrated and ongoing control of work following contract award explained.
This course has relevance to everyone working in commerce and industry who need to expand their knowledge of
the Commercial and Business environment. Having completed the course they should not only understand the
various subjects covered but also how to continue their education into more specific requirements of sales and
marketing, risk analysis and management and earned value techniques.
Despite the detailed nature of the content, the course director brings humour and interest giving a number of
examples of where he has utilized the different aspects of the course in real situations which have resulted in
Risk Analysis and Risk Management
Risk analysis and management is used extensively in modern industry, in fact virtually everything we do in the work place seems to be subject to a Risk
Unfortunately these are not always done well and serve little purpose in controlling anything. From a Commercial point of view we must be able to identify,
evaluate and control risk in time, resource and cost terms, to be successful in maintaining programme and cost baselines The purpose of our "Risk" courses
is to identify how to properly identify risk, quantify it in financial and programme terms and then to use all this information as a control mechanism, directing
pricing, programme and cost baseline and management of the occurring risk in line with budgeted cost and timescale.
The course will demonstrate various risk identification techniques, then into quantification, simulation analysis, pricing for risk and analysis and control of the
risks as and when they occur. The compilation and use of Risk Registers, Risk Packages and the integration of all these techniques with other aspects of
programme control e.g. "earned value" will be clearly explained.
Risk Analysis and Management in some form is used in everything we say or do and therefore this course has relavence to all of us. However it is a must to
everyone involved in design, development, construction or production in all forms of technology.
Earned Value Techniques
Despite being perceived as the in vogue techniques for developing programme control and cost control, they have in fact, been around for more than fifty
years. 'Earned Value' was generally developed in North America and applied, with success, to many defence and aerospace development and production
programmes on both sides of the Atantic during the 70's and 80's. However the UK and other parts of Europe have been slow to adopt these in other
industries e.g. the construction industry; which has served to continue the disasterous catalogue of overspends and time overruns with which we are all
familiar. The Channel Tunnel, the Milleneum Dome, various underground line extensions and, of course, more recently Wembley Stadium.
Why is this? One can offer a number of reasons, firstly these techniques are costly and time consuming to apply. Secondly large projects tend to be subject
to a great deal of political manipulation and properly applied, earned value techniques make this impossible. Finally because of our slowness in adopting
these techniques there are relatively few people who can properly develop and apply them.
Despite the above, the fact remains that if you are spending more than £50,000 on a project you should apply "earned value" at some level.
What then is "Earned Value"? Quite simply it is a measurement technique; I like to use the phrase a "three dimensional" measurement technique. As, not
only does it measure spend against budget, but also measures achievement and its cost. How does it do this? By developing a three dimensional integrated
baseline of programme (linked logic network), resources (estimated against packages of work which are directly related to the network) and cost (those
resources converted into cost using standard rates applicable to the Company's labour and other costs.
These baselines are developed from an agreed customer specification, which is used to create a Work Breakdown Structure (WBS); this WBS is then used
to create the llinked logic networks (at their various levels) and the Work Package, Minor Task and Major task resourse and cost collection systems.
This baseline becomes that which progress, resource and cost is measured against, giving the three measurement parameters, BCWS (Budgeted Cost of
Work Scheduled), ACWP (Actual Cost of Work Performed) and BCWP (Budgeted Cost of Work Performed). The comparison of these parameters gives you
"Cost" and "Schedule" variances which show whether the project is on time and on cost.
Those of you who are working for a Company who is, or wishes to, utilize these techniques and you do not fully understand the above, should seriously
consider attending our "Earned Value" training, or alternatively arrange some tailored onsite training.
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