ABSTRACT
This study centres on Failure Evaluation of Engineering Projects in Nigeria, A case study of Pipeline and Product Marketing Company Limited (PPMC). The instrument used in this study is analysis of some randomly selected Projects and questionnaires administered to Professionals involved in the execution of projects in PPMC. The result of this study show that there is still no consensus among project Management experts on what constitute a project failure, some consider failure based on the four constraints of Project Management (Budget, Schedule, Scope and Quality) while others consider it based on stakeholders expectation. The research shows that based on the constraints of Project Management, 85% of the projects in PPMC failed within 2011-2015- It was discovered that 41% of the failed projects were due to schedule, 29% due to bad scoping, 18% due to budget and 12% due to quality. The research also shows that from stakeholders perspective, of the 40% failed Projects in PPMC within the years 2011-2015, it was also discovered that 38% failed due to budget, 37% due to bad scoping and 25% due to quality. It is recommended that employment of principle of adequate budgeting and timely milestone payment will go a long way in reducing Project Failure in PPMC.
TABLE OF CONTENTS
TITLE PAGE…………………………………………………………………………………………………..i
DECLARATION….………………………………….………………………………………………………..ii
CERTIFICATION…..…………………………………………………………………………………….…..iii
ACKNOWLEDGEMENT ………………………..………….……………………………………………….iv
DEDICATION…………..…………………………………………………….………………………………..v
ABSTRACT………………………………………….…………………………………….………………….vi
TABLE OF CONTENTS………………………………………………………………………………………………………………….vii
LIST OF FIGURES………………………………………………………………………………………………………………………….ix
LIST OF TABLES……………………………………………………………………………………………………………………………xi
DEFINITION OF TERMS……………………………………………………………………………………………………………….xii
1.0 INTRODUCTION …………………………………………………………………………………………………………………….. 1
1.1 BACKGROUND OF THE STUDY …………………………………………………………………………………….. 1
1.2 PROBLEM STATEMENT …………………………………………………………………………………………………. 2
1.3 THE PRESENT RESEARCH ……………………………………………………………………………………………… 3
1.4 AIM AND OBJECTIVES …………………………………………………………………………………………………… 3
1.5 SIGNIFICANCE OF THE STUDY ……………………………………………………………………………………… 4
1.6 SCOPE AND LIMITATIONS …………………………………………………………………………………………….. 5
2.0 LITERATURE REVIEW ……………………………………………………………………………………………………………… 6
2.1 PROJECT MANAGEMENT ………………………………………………………………………………………………. 6
2.1.1 DEFINITION OF PROJECT MANAGEMENT …………………………………………………………….. 6
2.1.2 HISTORY OF PROJECT MANAGEMENT………………………………………………………………….. 7
2.1.3 PROJECT MANAGEMENT PROCESSES …………………………………………………………………… 9
2.1.4 PROJECT MANAGER …………………………………………………………………………………………….. 15
2.1.5 REASONS FOR PROJECT FAILURES ……………………………………………………………………… 20
2.2 THEORETICAL FRAMEWORK ……………………………………………………………………………………… 29
2.3 BRIEF ON PPMC ……………………………………………………………………………………………………………. 31
2.3.1 MISSION ………………………………………………………………………………………………………………… 31
2.3.2 VISION …………………………………………………………………………………………………………………… 32
2.3.3 OPERATIONAL STRUCTURE ………………………………………………………………………………… 32
2.3.4 MODE OF OPERATION ………………………………………………………………………………………….. 32
2.3.5 THE PRODUCTS PIPELINES AND DEPOTS SYSTEMS …………………………………………… 33
2.3.6 MARINE MOVEMENT ……………………………………………………………………………………………. 33
2.3.7 TYPES OF PROJECTS HANDLED BY PPMC …………………………………………………………… 34
2.4 REVIEW OF RELATED PAST WORKS/ STUDIES ………………………………………………………….. 35
3.0 RESEARCH METHODOLOGY …………………………………………………………………………………………… 38
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3.1 INTRODUCTION …………………………………………………………………………………………………………… 38
3.2 RESEARCH DESIGN ……………………………………………………………………………………………………… 38
3.2.1 POPULATION OF THE STUDY ………………………………………………………………………………. 39
3.2.2 DATA GATHERING TECHNIQUES ………………………………………………………………………… 40
3.2.3 INSTRUMENTATION …………………………………………………………………………………………….. 40
3.3 LINKERT SCALE …………………………………………………………………………………………………………… 41
4.0 DATA PRESENTATION AND ANALYSIS …………………………………………………………………………. 43
4.1 INTRODUCTION …………………………………………………………………………………………………………… 43
4.2 SOME MAJOR PROJECTS HANDLED BY PPMC BETWEEN 2010-2015 …………………………. 43
4.2.1 ANALYSIS OF THE PROJECTS ………………………………………………………………………………. 43
4.3 ANALYSIS OF QUESTIONNAIRE ………………………………………………………………………………….. 46
4.3.1 RESPONDENTS INFORMATION ……………………………………………………………………………. 46
4.3.2 RESULTS ……………………………………………………………………………………………………………….. 50
5.0 CONCLUSION AND RECOMMENDATIONS ……………………………………………………………………… 62
5.1 CONCLUSION ……………………………………………………………………………………………………………….. 62
5.2 RECOMMENDATIONS ………………………………………………………………………………………………….. 63
REFERENCES………………………………………………………………………………………………………………………………..65
APPENDICES…………………………………………………………………………………………………………………………………67
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CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
There is an age-old saying that says: “we can do anything we want, but we cannot do everything we want.” This is the classic conundrum that all firms face. Organizations across industries are challenged to deliver an increasing number of projects and programs, while maintaining flat (or decreasing) budgets and resources. In such an environment, only one outcome is possible project failure (Nokes, 2007).
Pipeline and Products Marketing Company (PPMC), as a company invests millions of Naira to projects, brings on board the services of international expatriates using local resources to meet the compelling demands of its projects, yet we have experienced a lot of project failure within the framework of the system.
To fully understand the nature of projects and why they fail, it is absolutely necessary to understand what a project is, its management, key elements and its successes.
A project is a temporary endeavour designed to produce a unique product, service or result with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverables) undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value (Oracle, 2011).
The temporary nature of projects stands in contrast with business as usual (or operations), which are repetitive, permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is
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often quite different, and as such requires the development of distinct technical skills and management strategies (Dinsmore, 2005; Cattani etal., 2011).
The Project Management Conference of Nigeria, PROMACON has advocated several times for the adoption of internationally proven best practices on Nigerian Projects including Projects in Pipeline and Products Marketing Company PPMC. The organization has committed huge resources to running troubleshoots on the major causes of failure of Nigerian Projects and has agreed that top on the list of factors is Institutional framework error. The Nigerian agencies and ministries are void of departments focused on ensuring projects success.
In PPMC and Nigeria in general, the implementation of modern project management tools, methods and techniques is still not well established, this results into failure of public institutions and their contractors in performing their duties concerning the budget, specifications and deadlines of the projects awarded. Studies have recognized social and political systems, cultural blocks and lack of financial support as barriers to successful project planning and execution in Nigerian public sector (OLATEJU etal, 2011). Project management experts in the country say policy instability, weak operating infrastructure, and poor legal and political framework are high on the list of reasons why many projects have failed in Nigeria.
1.2 PROBLEM STATEMENT
Failure of projects in Nigeria has been a recurring decima. There are many factors that have been identified to affect project success in Nigeria or can be stated to have been identified as the main causes of project failure. As it is stated above, policy
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instability, weak operating infrastructure, and poor legal and political framework are high on the list of reasons why many projects have failed in Nigeria. The attendant effects are:
i. Abandonment of projects
ii. Variations in project cost
iii. Scope creep in projects
iv. Poor quality of projects
This research work is aimed at studying the causes of project failure, the problems associated with the failures and proffer solution to improving success of projects in PPMC.
1.3 THE PRESENT RESEARCH
This study is to assess the success rate of projects in Nigerian Establishments in general and Pipeline and Product Marketing Company Limited in particular with the view to improving them. This can be accomplished by studying the factors that causes the failure of the projects and make corrections or adjustments where necessary.
1.4 AIM AND OBJECTIVES
The aim of this research is to identify the causes of project failure in Pipeline and Product Marketing Company Limited (PPMC) and recommend ways of reducing project failures and improving project success in the establishment.
The specific objectives are to:
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i. Assess the rate of failure of projects and their causes in the last five years in Pipeline and Product Marketing Company Limited (PPMC)
ii. Identify the causes of failure and abandonment of Engineering projects in PPMC
iii. Examine the failure mode criteria and warning signals so as to predict impending failure and abandonment of engineering projects in PPMC through subjective reasoning
iv. Study the contributory factors to success and failure in the implementation of Engineering projects by government consultants and professionals
v. Suggest workable solutions to forestall the future problems of failure and abandonment of projects in PPMC
1.5 SIGNIFICANCE OF THE STUDY
The study of project failures in Nigerian establishments will expose to some extent the causes of failure to project managers in Nigeria, to the Nigerian Government and to all Nigerians in general. Knowledge of the causes and remedies of project failure can be said to create awareness and improve the success of future projects in Nigeria. Most a times these causes are known by the project managers, but circumstances beyond them and government policies leaves them vulnerable to them.
The causes of project failures are similar anywhere and for all types of projects, although the solution may differ from one project to the other. This is because no two projects are the same and all projects come with their unique challenges. Knowing
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the probable causes and putting in place the right control measures will minimise the chances of failure and improve the chances of success of the particular project.
This study will look at some projects in PPMC and analyse their failures and successes and suggest ways of improvement. If recommendations are adopted, it will contribute to improvement in success rate of projects in PPMC, NNPC and the Nigerian Government in general. The study will be based on practical application of the methods suggested and will look at original projects that have been undertaking by PPMC. This will make the recommendations more practical and more applicable to future projects.
1.6 SCOPE AND LIMITATIONS
This study will be limited to engineering projects undertaken by PPMC within the last 5 years (2011-2015). It will look at projects from Maintenance Department and Engineering and Technical Services Department (ETSD) the two departments concerned with engineering projects in PPMC.
This project is in no way aimed at exposing the lapses of individuals involved in the execution of projects nor is it aimed at praising individuals for their success. It is undertaken to identify causes of failure and recommend ways to improve them. Real projects are only used as a case study so as to obtain real data from real projects executed in PPMC. The study will look at Electrical, Instrument and Mechanical projects in PPMC within the period stated.
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