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Responses to Reclamation’s Final Draft Report Management for Excellence: The Status of Project Management Dated September 12, 2006 General Comments: Reclamation has had good and bad experiences using contractors to fill in for staff shortages, that is, the use of outsourcing for major maintenance work. It appears that the Reclamation’s Contracting Offices needs to provide a greater opportunity for the Reclamation’s area offices staff and Power Customers to provide input and feedback comments on the selection of contractors, final design and plans, and a review of milestone benchmarks and scheduling. Furthermore, Reclamation needs to provide the Power Customers a meaningful opportunity to participate in Reclamation’s technical or economic review teams related to O&M activities. Outsourcing should not increase Reclamation’s costs; and should be considered only when there are expected cost savings. Comments on Draft Report: There are three major issues that the Project management Team has or needs to address in their Interim and Final Reports First Issue – Involvement of Stakeholders: This issue was mention in the Executive Summary section and in many places throughout the final draft report. On page ii of the Executive Summary, the following sentence was written, “It was also found that Reclamation has inconsistent approaches, solutions, and policies, which can be characterized as providing flexibility, but can lead to problems in some areas such as effective and consistent communication with management and stakeholders.” Stakeholder (water, power, and other impacted users) involvement is critical to the success of selecting qualified contractors and the monitoring of these contracts throughout a project’s Life Cycle. It is not necessary for the customers to micro manage these projects or their associated contracts and processes that support the projects; rather at the beginning, interim, and conclusion phases of project, it is important to consult with interested stakeholders to ensure that all ideas, needs and expectations are addressed throughout a project’s life. A consistent plan of how to interact at each phase with interested stakeholders is recommended; such a plan could have enough flexibility to allow local or regional contracting offices and personnel to tailor the interaction plan with the needs of the projects and those of the stakeholders. Such involvement of stakeholders should be available for contracting, financing, and technical issues, as well as on project monitoring and status report matters. Second Issue – Insure An Adequate Enforcement Mechanism Existing: When Reclamation hires Outside Contractors or Outsourcers for work tasks or projects, there needs to be a defined mechanism for in enforcement of contract terms, standards, test requirements, and quality of completed tasks or projects. One such mechanism is the use of monitoring and inspection activities which would provide an early indication to Reclamation of impending scheduling or procurement problems, inferior quality of materials or workmanship, and an over run of planned budget or milestone goals. Another technique that may be employed is one that uses a combination of Reclamation personal and contractor personnel to share project tasks or activities; this arrangement encourages a greater integration of Reclamation’s staff or crews with that of the outside contractor’s; and by doing so, first hand knowledge can be gained on the quality of tasks accomplished, and how the overall work is progressing. It may be that each side does not work on the same task simultaneously; but rather that, each side’s next phase of work is depended on the other side’s previous work, in order to complete each successive stage of the project. Liquidation damages built into a contract, that are enforceable, are another mechanism that could be used to insure that an outside contractor’s work is completed on time, on schedule, and passes all required testing standards, and milestones. Equally important is the enforcement of the liquidation damages when those tools are applicable. Third Issue – Involvement of Area Office Staff: As mentioned Reclamation’s Contracting Offices needs to provide a greater opportunity for the Reclamation’s area offices staff and Power Customers to provide input and feedback comments on the selection of contractors, final design and plans, and a review of milestone benchmarks and scheduling. Involvement of the Area Office staff on projects that are or will become their O&M responsibility is imperative. Such area office staff will have a thorough understanding and background knowledge of any existing facilities, and how these new or additional facilities would better be integrated with into or with existing facilities. Finally – The overall final draft report appears to be well researched and written. The appendices add a lot of useful information to the understanding of how Project Management activities should be accomplished. The PM team has well incorporated the first major issue listed above; they need to do the same for the latter two issues. Thanks for the opportunity to review and comment on the draft final report.	10/06/2006

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Responses to Reclamation’s Final Draft Report
Management for Excellence: The Status of Project Management
Dated September 12, 2006

General Comments:

Reclamation has had good and bad experiences using contractors to fill in for staff shortages, that is, the use of outsourcing for major maintenance work. It appears that the Reclamation’s Contracting Offices needs to provide a greater opportunity for the Reclamation’s area offices staff and Power Customers to provide input and feedback comments on the selection of contractors, final design and plans, and a review of milestone benchmarks and scheduling. Furthermore, Reclamation needs to provide the Power Customers a meaningful opportunity to participate in Reclamation’s technical or economic review teams related to O&M activities. Outsourcing should not increase Reclamation’s costs; and should be considered only when there are expected cost savings.

Comments on Draft Report:

There are three major issues that the Project management Team has or needs to address in their Interim and Final Reports

First Issue – Involvement of Stakeholders:

This issue was mention in the Executive Summary section and in many places throughout the final draft report. On page ii of the Executive Summary, the following sentence was written, “It was also found that Reclamation has inconsistent approaches, solutions, and policies, which can be characterized as providing flexibility, but can lead to problems in some areas such as effective and consistent communication with management and stakeholders.”

Stakeholder (water, power, and other impacted users) involvement is critical to the success of selecting qualified contractors and the monitoring of these contracts throughout a project’s Life Cycle. It is not necessary for the customers to micro manage these projects or their associated contracts and processes that support the projects; rather at the beginning, interim, and conclusion phases of project, it is important to consult with interested stakeholders to ensure that all ideas, needs and expectations are addressed throughout a project’s life. A consistent plan of how to interact at each phase with interested stakeholders is recommended; such a plan could have enough flexibility to allow local or regional contracting offices and personnel to tailor the interaction plan with the needs of the projects and those of the stakeholders. Such involvement of stakeholders should be available for contracting, financing, and technical issues, as well as on project monitoring and status report matters.

Second Issue – Insure An Adequate Enforcement Mechanism Existing:

When Reclamation hires Outside Contractors or Outsourcers for work tasks or projects, there needs to be a defined mechanism for in enforcement of contract terms, standards, test requirements, and quality of completed tasks or projects. One such mechanism is the use of monitoring and inspection activities which would provide an early indication to Reclamation of impending scheduling or procurement problems, inferior quality of materials or workmanship, and an over run of planned budget or milestone goals.

Another technique that may be employed is one that uses a combination of Reclamation personal and contractor personnel to share project tasks or activities; this arrangement encourages a greater integration of Reclamation’s staff or crews with that of the outside contractor’s; and by doing so, first hand knowledge can be gained on the quality of tasks accomplished, and how the overall work is progressing. It may be that each side does not work on the same task simultaneously; but rather that, each side’s next phase of work is depended on the other side’s previous work, in order to complete each successive stage of the project.

Liquidation damages built into a contract, that are enforceable, are another mechanism that could be used to insure that an outside contractor’s work is completed on time, on schedule, and passes all required testing standards, and milestones. Equally important is the enforcement of the liquidation damages when those tools are applicable.

Third Issue – Involvement of Area Office Staff:

As mentioned Reclamation’s Contracting Offices needs to provide a greater opportunity for the Reclamation’s area offices staff and Power Customers to provide input and feedback comments on the selection of contractors, final design and plans, and a review of milestone benchmarks and scheduling. Involvement of the Area Office staff on projects that are or will become their O&M responsibility is imperative. Such area office staff will have a thorough understanding and background knowledge of any existing facilities, and how these new or additional facilities would better be integrated with into or with existing facilities.

Finally – The overall final draft report appears to be well researched and written. The appendices add a lot of useful information to the understanding of how Project Management activities should be accomplished. The PM team has well incorporated the first major issue listed above; they need to do the same for the latter two issues.

Thanks for the opportunity to review and comment on the draft final report.

10/06/2006