Pacific Northwest National Laboratory's capability replacement laboratories project
Pacific Northwest National Laboratory
This paper discusses repeatable and integrated techniques that enabled success of the Capability Replacement Laboratories (CRL) Project in an environment of constrained construction schedules, multiple agency stakeholders and funding sponsors, an insufficient capital budget, and legacy radiological contamination within the construction footprint. These conditions served to increase risk and constrain the options for delivery.
Eight years ago in 2004, hundreds of employees at the Pacific Northwest National Laboratory (PNNL) were conducting state-of-the-art research in World War II-era buildings as part of its mission to meet U.S. needs in energy, environment, and security. Exhibit 1 shows the buildings as they were in 1945. In 2004, these same buildings housed one third of the research staff, and provided more than one half of the research laboratory space, and all of the nuclear capability for PNNL. These employees and their equipment were at risk of eviction and PNNL's ability to meet its mission obligations was at risk due to competing commitments with the State of Washington to remediate legacy contamination sites from the 300 Area at Hanford. The CRL Project successfully met the needs of relocating staff and equipment with minimum impact to PNNL's mission delivery. This paper will resonate with both new and experienced project managers as they evaluate solid project management techniques for an extremely complex project.
This paper describes the critical need for the CRL Project (history), the project management philosophy responsible for successful delivery on time and under budget (methods and criteria), and project conclusions (summary).
The CRL Project's successful completion is testimony to the benefits of a disciplined application of integrated project management techniques.
PNNL is a United States (U.S.) Department of Energy Office of Science (DOE-SC) laboratory located in south central Washington State and operated by Battelle Memorial Institute. It has unique strengths in molecular and environmental sciences and engineering that advance scientific frontiers and address national needs in energy, environment, and security.
PNNL conducted state-of-the-art research and development (R&D) in many World War II-era laboratories and offices within the Hanford 300 Area. Legacy waste remediation is the DOE Environmental Management (DOE-EM) mission at Hanford. The Washington Department of Ecology, U.S. Environmental Protection Agency, and DOE collectively developed and committed to a Tri-Party Agreement— the legal framework for environmental remediation. The agreement required PNNL to evacuate these laboratories and offices slated for legacy waste remediation by 2015. In 2002, an aggressive plan was adopted to accelerate closure of a significant portion of these buildings by 2011, four years early. The accelerated deadline for facility demolition created constraint #1—a fixed deadline for all laboratory and equipment relocation associated with CRL while minimizing impacts to mission-critical research.
Multiple federal clients relied on PNNL for R&D capability to meet U.S. needs, and hundreds of staff members depended on laboratories and offices within the cleanup area to conduct that work—long-term capability and jobs that would be lost without suitable replacement laboratory space. The accelerated remediation schedule put PNNL's core science and technical capabilities at risk because it scheduled demolition of one half the research laboratory space and all its nuclear capability. In 2004, DOE directed PNNL to design new, state-of-the-art facilities to replace PNNL R&D capabilities in the Hanford 300 Area. An aerial photo from 2004 appears in Exhibit 2.
The threat of eviction created the opportunity to design a modern, consolidated campus. However, constructing all new facilities, which was the original expectation and deliverable, proved unaffordable even with three funding agencies (DOE, U.S. Department of Homeland Security [DHS], and the National Nuclear Security Administration [NNSA]). The budget allocation created constraint #2— the congressionally approved budget was set long before project planning was complete and it was not sufficient to meet all needs for new construction, even with shared financial responsibility.
With constraints #1 and #2 understood, project scope became the only variable that the team could adjust to remain within budget and schedule. The CRL Project Team evaluated numerous creative alternatives to reduce costs, but ultimately re-scoped the project and revalidated the mission need. They employed the DOE Critical Decision process through site selection to retain capabilities and deliver all scope within the budget constraint. This scope included both construction of new laboratory facilities outside the Hanford 300 Area and negotiating an agreement with DOE to retain four existing facilities through 2026. This strategy required life-extension upgrades for one nuclear and two radiological facilities, and infrastructure modifications to a plant operations building in conjunction with construction of new laboratory space. An aerial photo taken in 2012 appears in Exhibit 3.
A comprehensive strategy with the following scope, funding, and financing components from six participants was adopted for the CRL Project and is depicted in Exhibit 4, “CRL Project Sponsor and Stakeholder Strategy.”
- Capital line-item funding for the Physical Sciences Facility (PSF) jointly funded by the DOE-SC, DHS, and NNSA — US$224 million
- Alternative third-party financing in the broader CRL Project scope for the Biological Sciences Facility and the Computational Sciences Facility (known as BSF/CSF) — US$95 million
- DOE-EM funding to reroute Hanford 300 Area utilities — US$12 million
- DOE-SC and General Plant Project funding for life extension of four Hanford 300 Area facilities that were retained for continued operation — US$7.7 million
- Washington State funding for green-field site utilities — US$5 million
- PNNL funding for transition and relocation of staff and equipment — US$33 million
- Total CRL Project Cost — US$377 million
Funding partnerships and third-party financing were imperative to accomplishing the full scope of the CRL Project; however, this distributed financial responsibility represented constraint #3 and maintaining these financial commitments through the project's four-year duration required by far the most significant effort associated with project delivery, adding substantial complexity to an already large, complicated project.
Complexity creates an environment for rapid change and surprises. Imagine very creative research staff—best in the world at R&D—defining technical requirements and performance expectations for their future research environment and equipment relocation expectations. Compound that with three capital funding agencies (DOE, DHS, and NNSA) each with their own expectations for project management techniques and culture. Then add the integration and communication requirements for maintaining financial responsibilities among the six funding participants and complexity emerges in unique and surprising ways. For example, the funding profile shares for the capital line-item portion (PSF) of the integrated CRL Project were negotiated among DOE, DHS, and NNSA. Each agency had its own annual appropriation, process, and timing, demanding constant contingency planning to cover funding uncertainty. This is just one small example of where complexity and change emerged.
Three constraints emerged through the planning and authorization process of the CRL project:
- The project deadline was fixed to enable the legal requirements associated with demolition of legacy facilities in the Hanford 300 Area.
- The project capital construction budget was fixed through congressional commitments established before project planning was complete.
- A distributed financial responsibility commitment was established among six funding participants and maintained through the project's life cycle.
Enabling and delivering a project while mitigating these three constraints added significant complexity to an already technically complex project. The CRL Project Team's robust philosophical methodology used to ensure transparency and cultural acceptance among multiple stakeholders and sponsors is discussed next.
The CRL Project Team employed the project management MedallionSM TM model for project integration that maximized efficiency and provided transparency among the many project sponsors and project stakeholders. The Medallion model was developed in 1992 as a structure for teaching project managers, project management tools, and processes for use in the national laboratory environment. The Medallion model provides a structure that project managers can use to reinforce project integration regardless of the client's environment or culture. It is based on A Guide to the Project Management Body of Knowledge (PMBOK® Guide) by Project Management Institute. A diagram of the Medallion is in Exhibit 5.
With its many stakeholders, complex funding strategy, technical systems requirements, and multiple contracting strategies, the level of integration for each medallion component was significant and the mix of tests used to satisfy the project's needs were extensive.
The application of project management tools and techniques is typically specific to a corporate or stakeholder's culture. In some cases, the approach is highly proprietary and in others it is emerging as a project life-cycle delivery environment. Project managers “learn” to implement projects in their employer's culture and the likelihood is remote that any given client set will implement projects the same way. When faced with multiple stakeholders and project delivery expectations that vary between stakeholders, the Medallion provided a consistent structure for translation in a transparent manner which proved very useful on the CRL Project. The Medallion has also been used successfully across multiple projects in other DOE programs and sites. It is typical for PNNL's clients to use their own tools and methods to manage projects. Sometimes these tools are client proprietary or sensitive. In many cases, a client's approach for one element of research at PNNL may significantly conflict with another client's expectations. The Medallion serves as a structure for an integrated focus on the project objective that can be easily applied to any project, in any environment. Depending on the complexity of the project, the level of sophistication associated with integrating all elements of the Medallion increases or decreases. The level of sophistication then defines the tool set required to implement the project.
Project managers at PNNL have expanded the generic Medallion to illustrate its application and linkage to electronic tools meeting the PMBOK® Guide standards as shown in Exhibit 6.
Several instruments were used to manage and integrate project interactions. A Memorandum of Agreement (MOA) signed by Mr. James A. Rispoli, then Assistant Secretary of Energy for Environmental Management, and Dr. Raymond Orbach, then DOE Under Secretary for DOE-SC, gave access to large areas for wholesale building removal (rather than working around occupied facilities) to Washington Closure Hanford. The MOA established dates when specific buildings would be available for cleanup, thereby effectively determining the deadline and completion criteria for the CRL Project.
A Memorandum of Understanding (MOU) among DHS, NNSA, and DOE-SC described a pivotal early agreement for the three principal stakeholders who would provide the largest share of funding. The MOU documented formal agreements for the overall scope, schedule, and budget objectives of the CRL Project. The highest levels of DOE-SC and DHS, and the Under Secretary of each organization signed the MOU.
The project charter formally authorized the CRL Project to begin in July 2004 and conveyed the project manager's authorities and responsibilities to plan and execute actions to retain mission-critical research and applied technology capabilities. The charter defined the project's scope, cost, schedule objectives, the roles and responsibilities of the project sponsors and management team, and a strong matrix structure for project implementation. The charter also set the expectation for rigorous risk mitigation that was integrated in the formal, approved Project Management Plan.
Peer and independent reviews were important project management instruments, which were employed to verify the project's mission, organization, development, processes, baseline and progress. Reviews were initiated internally by the project team or by stakeholders. Reviews were recurring-scheduled events or unscheduled events to meet a specific objective or need, such as a budget validation or a DOE Critical Decision request.
The project management plan served as the master integration document. It described the project scope; the project management strategy; planning; and scope execution through time, cost, quality, human resource, communication, risk, and procurement management. The CRL project manager and team also used supporting project integration plans and project execution plans to direct work through project closeout.
Successful project execution depended on accurate definition of requirements. The team engaged project sponsors and stakeholders in workshops for their knowledge of federal initiatives and the R&D capabilities required for long-term mission delivery then housed in approximately 700,000 gross square feet. The team considered many replacement options and after careful evaluation, reached consensus on capabilities required for the future. These vetted and approved capabilities became the basis for planning replacement space. Leads from PNNL R&D organizations were vital to scope identification and were engaged throughout the project's execution phase to assess value engineering changes.
This collaboration resulted in close coordination between the CRL summary task managers and the R&D capability leads who represented the research organizations, the interests of the staff, and the care of the equipment that would be moved to the CRL facilities. The collaboration also ensured that the capability leads' needs were met during the design, construction, and occupancy phases within the cost, schedule, and scope constraints.
The CRL Project was managed using a work breakdown structure (WBS) and scope was definitized at the control account and work package level. WBS dictionaries were prepared at the summary task level to describe the overall technical objective, scope, and key deliverables of the WBS element. Key PNNL staff took responsibility for the summary WBS elements, for both planning and scope execution using a strong matrix structure. The high-level WBS appears in Exhibit 7. Assignments were documented in the project's responsibility assignment matrix.
A rigorous configuration management and integrated baseline control system was used to ensure the technical baseline was clearly defined and controlled throughout the project, from conceptual design to facility turnover. The technical scope of work was defined and placed under configuration control in documents formally designated and approved by the Federal Project Director, sponsors, and stakeholders. The initial technical baseline was documented in the Conceptual Design Report and evolved into the Preliminary and Final Design Reports as scope was further defined and approved during the project phases. Progressive elaboration was used in each phase, from conceptual to final design. The final engineering documents, which provided instructions for procurements and directions for construction, fabrication, testing, operation, and maintenance, established the configuration of the project and basis for rigorous configuration management and integrated baseline control. As the project progressed through each phase, the control account plans were updated using this iterative process.
The CRL Project had a single highly integrated schedule that incorporated activities for the life of the subprojects and depicted the critical path for final completion and closeout. Significant milestones that formed major phases were the basis for a comprehensive list of sequential and parallel activities, resources, durations, interdependencies, and other interface points.
Horizontal traceability was integrated throughout the schedule using interdependent relationships among the activities within different control accounts, as well as interdependency among tasks within the same control account. Knowing failures often occur at interfaces among control account schedules, additional rigor was applied to manage these interfaces, and ensure communication among affected and responsible control account managers for baseline schedule integrity. The schedule was updated daily and provided a single status on construction, commissioning, quality assurance, and training plans.
The baseline cost for the CRL Project was US$377.5 million; the actual final cost was US$376.7 million. With the CRL representing a combined effort of multiple, separate, and distinct scopes of work that required separate and distinct types and sources of funding, and because of the constrained funding profiles, the total project cost of each scope of work and the time-phased budget profile were critical in the overall project management process from the inception of the project. To ensure all aspects of the project complied with the funding constraints and requirements, a funding strategy was developed so that funding requirements could be clearly communicated to project sponsors and stakeholders, and so that guidelines for the appropriate use of funds were established.
Sound cost and schedule baselines, areas of cost or schedule risk, potential contingent scope items, and value-engineering opportunities followed principles for integrated cost and schedule performance management and control. These processes were formalized in the project's Project Execution Plan, Risk Management Plan, and Project Implementation Plan and were parts of PNNL's Certified Earned Value Management System, which met the requirements in American National Standards Institute/Electronic Industries Alliance-748, to define scope and objectives, develop and refine the schedule, and identify and refine resources while incorporating quality, safety and health, and risk mitigation requirements.
The CRL Quality Assurance (QA) Program was established to assure safety and protection during construction and to assure laboratory performance after construction. To avoid catastrophic events during facility operation, the CRL Quality Assurance Program Description (QAPD) ensured QA requirements and responsibilities were met on the CRL Project. The CRL QAPD established a Project Quality Officer who carefully examined Responses to Proposals for subcontractor qualifications; monitored construction through independent audits and surveillances to ensure compliance with construction specifications; provided guidance and expertise on QA matters; provided interpretations on QA program requirements; ensured quality was incorporated into training; and broadly communicated lessons learned and positive operating experiences using PNNL's Operating Experience and Lessons Learned Website, which was available to all parties on the project.
Human Resource Management
Project management executive talent, well known and professionally recognized for facility design and construction successes, led the CRL Project. CRL Project Team developed and documented project roles and responsibilities, required skills, reporting relationships, and training. The accomplishments of the training effort alone were heroic, working with 5,100 individual learners, 23,300 individual training sessions, and 19,200 learner training hours for staff and subcontractors who took “Radiological Worker I and II,” “Hot Work Fire Watch,” “LockOut/TagOut: Hazardous Energy Control,” “Asbestos Awareness,” and “Visitor/Contractor Orientation,” as their responsibilities required. The goal of zero lost workday accidents was achieved, for a total of 776,357 hours worked without a lost workday, thanks in large part to training. Exhibit 8 shows a safety and health professional delivering training to a researcher.
Given the strong matrix nature of the PNNL organization, the project had full-time project managers with full authority to bring members onto the team who were highly effective, with a high degree of cohesiveness and cooperation for overcoming project challenges. Project controls forecasted long-term project requirements for qualified project managers, engineers, architects, and others for appropriate phases of the project. Assignment deadlines were set for budget integrity. The project removed team members informally when assignments were over, returning them to their functional organizations for redeployment.
The CRL Project enjoyed excellent partnership and federal leadership from DOE-Headquarters and Pacific Northwest Site Office (DOE-PNSO). Membership on the broader Integrated Project Team included two Federal Project Directors from DOE-PNSO, DOE-SC Program Manager; DOE-PNSO Contracting Officer; DOE-PNSO Facility Transition, Startup and Readiness Coordinator; and a Contractor Project Director, Battelle. This results-oriented group possessed political expertise and program sensitivity to work with stakeholders that ranged from U.S. Senators Patty Murray and Maria Cantwell, U.S. House Representative Richard Hastings, Washington State Governor Christine Gregoire, Washington State Representatives and Senators, federally recognized tribal representatives, and special interest groups.
At the CRL Project Team level, PNNL team members established excellent relationships with their DOE-PNSO counterparts, the research and development leads, and subcontractors. Regularly scheduled meetings were used to ensure agreement with project direction and progress. Strong partnerships based on mutual respect were especially important for collaborative real-time issue resolution. The CRL Project Team also had a positive relationship and mutual respect with DOE-SC's Chairman of Independent Project Reviews. Client Relationship Managers from PNNL were equally effective and responsible for the relationships with NNSA, DHS, and DOE-EM.
The diverse relationships and interactions involved in the CRL Project required a robust communications plan to ensure information was comprehensively and appropriately disseminated in a timely manner. Interactions between project participants formed the basis for vertical and horizontal communication flows. Guidance and vital information flowed down through the Federal Project Director and the IPT. Information on deliverables, recommendations for supporting decision processes, and performance against established objectives flowed up from the CRL Project. Horizontal information flowed to project participants and stakeholders to support their interactions and contributions to project success. Periodic independent reviews of project performance served to further enhance information flow between the project team and stakeholders. The federally funded portions of the projects underwent formalized quarterly reviews. Other elements of the project received a formal review, as necessary, to understand progress with at least semi-annual assessment of performance in accordance with the PNNL Independent Advisory Committee Charter.
Communication with external stakeholders was systematic and formally documented in letters of direction, signed and published meeting minutes, and the MOU, all of which were retained as records following the project's approved information management plan. Publicly available information was pushed to the external CRL Project Website and interactive communication was conducted using email. The Federal Project Director and DOE-PNSO were members of the CRL Project Team, creating a combination of external and internal stakeholders. They attended the PNNL Project Director's weekly status meetings as well as plan-of-the-day meetings to discuss hot topics and items requiring immediate attention. Other team members were subcontractors, and communications were governed by negotiated contracts. Although informal interaction was encouraged, contractual direction or clarification on technical issues was officially conveyed to the contractor following the terms and conditions of the contracts.
Proactive risk mitigation was an integral component of the CRL Project because risk came in all forms; for example, multiple funding sponsors, each with its own annual appropriation forcing constant contingency planning to cover funding uncertainty; alternative financing for the broader CRL Project scope; six prime contractors and approximately 40 subcontractors; and discoveries of legacy radiological contamination during life-extension modifications, all the time maintaining facility operation for R&D (Exhibit 9).
A detailed risk protocol using an enterprise risk system drove the risk management plan. Early in the project, the risk analyst met monthly with senior management to discuss the results of the risk analyses, changes in risk exposure, and upcoming actions. As the project progressed, the risk analyst provided updates approximately every six weeks, and formal risk elicitation meetings occurred approximately every six weeks. The CRL Project team understood, staffed, and supported risk identification and mitigation as part of day-to-day project management activities.
Procurement planning started early with a strategy that would best deliver project requirements, while complying with the project's baseline cost and schedule constraints, and complex risks. Procurement objectives and activities aligned with the project's WBS, monitored progress using PNNL's certified Earned Value Management System. For accountability, a risk register for procurement-related activities was weighted to a mitigation strategy for all procurements.
Using a qualification-based selection process, six prime architect/engineering contracts were awarded. The prime contractors awarded 40 additional contracts to deliver requirements. PNNL's prime contract procurements had a dedicated procurement specialist who participated in design reviews and was onsite to coordinate timely pricing and settle changes to the work. As the project advanced through the fast-track development of construction packages and as confidence grew in the adequacy and constructability of the design, risks were downgraded on the project risk matrix and transferred to the contractor.
Once contracts were completed, performance evaluations focusing on performance strengths and weaknesses were reviewed with the contractors. Contracts were closed quickly without incident, and the contractors parted with a better understanding of areas for improvement in anticipation of other contracting opportunities.
The CRL Project retained mission-critical research and applied technology capabilities for DOE-SC, the NNSA, and DHS. The scale and complexity were truly unique, involving construction of several new laboratory facilities, relocation of 973 researchers and their equipment, modernization of nuclear facilities from the World War II-era, and support of cleanup commitments for Hanford by exiting eight research and support buildings. Scope was accomplished while minimizing impacts to mission-critical research and focusing on safety, security, and research program needs.
New facilities promote DOE's sustainability objectives. The BSF/CSF received Leadership in Energy and Environmental Design (LEED®) Gold certification, and these facilities have been recognized for regional Technology Awards from the American Society of Heating, Refrigerating and Air Conditioning Engineers. PSF received LEED® Silver certification.
In conclusion, the CRL Project's successful completion is testimony to the disciplined application of integrated project management techniques. Today state-of-the-art science, technical, and mission capabilities have been retained at PNNL. These capabilities and the research they support will continue to benefit DOE, NNSA, DHS, and the nation for years to come.
ANSI/EIA (2007). Earned Value Management Systems EIA Standard 748 (p. 34). Arlington, VA: Electronic Industries Alliance.
Project Management Institute (2008). A guide to the project management body of knowledge (PMBOK® guide)— Fourth edition. Newtown Square, PA: Author.
©2010, Dale E. Knutson, PMP
Published as part of the 2012 PMI Global Congress Proceedings — Vancouver, British Columbia, Canada