Our PMO Journey with Michelin

Geoff van de Merwe
Faithful+Gould continues to partner with Michelin in managing its project monitoring office and establishing its standard set of business practices.

Our team has been collaborating with Michelin since the global tire manufacturer recognized the need for streamlined processes for capital projects management. Together Michelin and Faithful+Gould have partnered to usher in a new era of project efficiency, time and cost savings for the company.

Michelin established a central project monitoring office (PMO) at its headquarters in Clermont Ferrand, France, with regional PMOs in other operating zones: North America, India, Brazil and China. Initially, the PMO was mandated to provide schedule and cost support for only the largest of capital projects, those more than $100 million. Recognizing the need for consultant support to partner with implementing this initiative, they went to the market and selected Faithful+Gould.

Faithful+Gould's strategy has been to support Michelin by partnering and using innovative software and processes to improve the maturity of the PMO and its staff.

Faithful+Gould's strategy has been to support Michelin by partnering and using innovative software and processes to improve the maturity of the PMO and its staff. Seven years later, and a lot of focus on strengthening the schedule, cost and scope management disciplines, what began as a specialized option for specific projects will now have its services mandated for any Michelin project with a budget of €4 million ($4.4 million) or more.

One of the areas where the partnership has excelled in has been innovation. This is a core value for the Michelin tire company and Faithful+Gould were pleased to support these efforts.

Some examples of innovation which Faithful+Gould has supported:

Integrated master schedules: The culture within Michelin has been for engineers to produce their schedules individually, allowing the interface between other scopes of work to be easily overlooked. By implementing Master Schedule and PMO planning support, interfaces between scope items are tracked and easily highlighted, should a change in one area of work potentially impact another area. This early notification results in early resolution with less effort and often at no additional cost.

Integrated cash flow model: The schedule and cost reporting software implemented can be linked so that changes occurring in schedule, budget or payment terms are instantly reflected in the cash flow. For projects that are utilizing the PMO, the time taken for producing an accurate cash flow analysis has been drastically reduced and project leaders and senior management have more timely and accurate cash flow visibility.

An Online Cost Management System (OCMS): The Construction Industry Institute (CII), which Faithful+Gould is an active member of, has proven research that good change management offers a greater chance of finishing on budget and ahead of schedule. OCMS has provided a structured process for reviewing, studying, and making decisions on changes. These can include change in scope, change in materials, design errors, and so on. This change management process has helped control scope creep and the resulting cost increases and scheduling delays. Efficiencies like these have enabled engineers to spend more time on engineering.

Lessons Learned

For the pilot projects, the PMO implemented these innovative processes at around the time that the project was approved and moving into the construction phase. The PMO realized that this timing made it too late to take advantage of the pre-planning phase of the project. Late involvement tended to result in the PMO people and systems not becoming fully integrated into the project team and process. By adjusting the timeline and becoming involved in the earlier phases of the projects, the PMO achieved a big step in providing additional value to the client. This early involvement also ensures that the strengths of the PMO’s innovative systems are maximized.

Challenges

The greatest challenge with implementing a new strategy is modifying an established culture to accept the change. Faithful+Gould’s approach has been to showcase the value which the people, processes and tools that are part of the PMO bring to the table.

"Faithful+Gould professionals combine technical skills with great values and behaviors we value at Michelin. This partnership is without any doubt a key factor of success for our PMO".

Paulo Ganime, global head of PMO at Michelin

The Michelin management of the PMO has been instrumental in achieving the successes to date. By continuing to mature the people within the PMO through targeted training, improving our processes through benchmarking and performance measurement and ensuring the PMO aligns with the strategic objectives, the PMO will grow as more people become convinced of its value. The partnership between Michelin and Faithful+Gould has made this possible, forming a team effort for this venture that has with endless potential for the future.

Faithful+Gould has been a key partner from the beginning of our journey implementing the PMO in Michelin," said Paulo Ganime, global head of PMO at Michelin. "Their professionals combine technical skills with great values and behaviors we value at Michelin. This partnership is without any doubt a key factor of success for our PMO".

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Geoff van de Merwe Program Director Contact me View my profile >