04/12/2023
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Construction Leaders Formula to Simplify EVM
Presented by: Ron Babich, PMP CEO / Co-Founder
MobileLogix/DispatchLogix
© MobileLogix / DispatchLogix 2014
04/12/2023
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About Us
© MobileLogix / DispatchLogix
• Ron Babich, CEO MobileLogix
• HQ Phoenix, AZ – Global Partner Support
• GE Capital, Sage, Telesoft, Hard Dollar/Kiewit, RIB
• 100% SAAS, Mobile Field Software
• Over 211 Capital, Maintenance, STO projects
• Finalist in Innovation Southwest Most Innovative Product Award
Goodrich
Uhaul
PetsMart
Tribune
Mitsubishi
Kohler
Payless
HD Supply
Shell
BP
Willbros
Wild Well
Universal
CH2MHill
Bloomberg
Time
Darden Restaurants
HP
Coca-Cola
US Airways
Johnson Controls
State Farm
Hatch
Stantec
FMI
FCI
Barrick
TransCanada
Transfield
Kinross
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EVM Paradigm
© MobileLogix / DispatchLogix
Plan
Estimate
Schedule
Report
Financials
Cash Flow
Forecast
Resources
Execution
Highest Risk
Lowest Visibility
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Tough to Train? Cooperate?
© MobileLogix / DispatchLogix
Owners
EPCM’s
Contractors
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Revolution in EVM Reporting
© MobileLogix / DispatchLogix
Opportunity to Leverage Consumer Training
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Critical Field Data
© MobileLogix / DispatchLogix
Quantity
Man Hours
Equip Hours
% Complete
Time to Report
6 to 8 Weeks
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Critical Field Data
© MobileLogix / DispatchLogix
Quantity
Man Hours
Equip Hours
% Complete
Planned
Actual
Forecast
Hour by Hour
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Manage by Exception
© MobileLogix / DispatchLogix 2014
Instant Notification of Bank Balance Reaches Below Minimum Expectation
Value ($ Spouse Grocery / Hair )
Balance $35.00 Below Standard
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In the know on data…
© MobileLogix / DispatchLogix 2014
Outbid by Ebayer007theTerrible on Collectors edition of Star Wars Episode 5 Storm Trooper set
Value $25, (Darth Vader +/- $30)
Lost Lead Position
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Important Notifications
© MobileLogix / DispatchLogix 2014
Mothers high score notification, and reminder to join her adventure in Candy Crush
Value ($0, Negative)
Networking Notification
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Value to Visibility
© MobileLogix / DispatchLogix
Ebay Bank Project $-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
Instant Updates
Monthly Updates
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Continued Stone Age…
© MobileLogix / DispatchLogix 2014
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Pressure from Consumer Products / Youth
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Outside (Them…also Us)Inside (US)
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What has created the opportunity?
© MobileLogix / DispatchLogix 2014
Size RetainableData Storage
BandwidthData Delivery
MobileData Accessibility
ApplicationCollaboration
(API/Warehouse)
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Storage
© MobileLogix / DispatchLogix 2014
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Bandwidth
© MobileLogix / DispatchLogix 2014
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Mobility
© MobileLogix / DispatchLogix 2014
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Migration to Data Understanding
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How we choose to viewData has officially changed…
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Mobility Training
© MobileLogix / DispatchLogix 2014
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Anatomy of Breaking EVM Simple
© MobileLogix / DispatchLogix
Good News Bad News
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Best Part, more good news…
© MobileLogix / DispatchLogix
Legacy systems will do the trick….mostly
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No Magic Potion, No Tricks - Smart Collaboration
© MobileLogix / DispatchLogix 2014
Owners
EPCM’s
Contractors
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Why Should We Do Anything Different?
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Its Ok not to Innovate…
Quick quiz:
Name a leading company today that was just as dominant 25 years ago.
© MobileLogix / DispatchLogix 2014
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Failure to Innovate Technology
© MobileLogix / DispatchLogix 2014
Yesterday Today
Blockbuster (Distribution) Netflix – Mail, Internet
Dell (PC) Tablet, Asian PC, End to End Service
Microsoft (Software) Web TV, Smartphones, Tablet PC
Motorola (Cell Phone) Smartphones, Email, Data Focus
Sears (Catalog/Tower) Insurance, Financial Services, Web Strategy
Sony (Walkman, Devices) Device Brains vs. Circuitry
Sun Microsystems (Dominant Enterprise) Less Costly Servers, Oracle
Toys R Us Online Stores, Better Service
Yahoo Free Services
Where are you today? Where will you be tomorrow?Where will the new force be tomorrow?
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Destiny to Change…
© MobileLogix / DispatchLogix 2014
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Why the effort…
Fighting Status Quo
• Increasing Profitability
• Improving Project Delivery Time
• Creating Marketplace Distinctive Competency
• Establishing Long Term Collaboration Standards
© MobileLogix / DispatchLogix 2014
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Leveraging New Technology Causes Internal Anxiety
© MobileLogix / DispatchLogix 2014
Process Enhance, Technology Plan/Embrace
Sustain Current Behaviors, Maintain Status Quo Technology, Disparate Silo’s
High Stress, Focus Effort
Low Stress,Reduced Effort
Increased,ExponentialResults
Maintained,Reduced Results
Reaction to Surrounding Technology Internal EffectDurationResults
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Traditional Systems of Record – What are we up against???
© MobileLogix / DispatchLogix 2014
2 Year Project Average
23,000 Activities
Estimate
Controls/Execution/Progress
Schedule
Finance Actuals
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Expansion of Size
© MobileLogix / DispatchLogix 2014
1 Complex 3D Model
300 Gig
Average Project DataScope/Schedule/Cost
50 Gig
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Data Growth Leaders in Construction
© MobileLogix / DispatchLogix 2014
50 X Times by 2020Average Organization
Structural Leads: Building, Bridges
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Data Multiplication
© MobileLogix / DispatchLogix 2014
Data Rate Almost X 2 Each Year
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Construction Industry Response…
© MobileLogix / DispatchLogix 2014
Revenue of $10 billion
1.1%
Revenue of $250 million
1.6% IT
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Lowest in adaptation…
© MobileLogix / DispatchLogix 2014
IT SPEND AS PERCENTAGE OF REVENUE
INDUSTRYANNUAL REVENUE APPROXIMATELY $250 MILLION
ANNUAL REVENUE APPROXIMATELY $10 BILLION
BANKING 7.3% 6.2%
CONSTRUCTION & MATERIALS
1.6% 1.1%
EDUCATION 5.6% 3.3%
FEDERAL GOVERNMEnT 10.8% 7.9%
STATE AND LOCAL GOVERNMENT
4.6% 1.8%
SOFTWARE AND INTERNET 8.4% 5.4%
INSURANCE 5.3% 2.9%
HEALTH CARE 3.5% 3.3%
MEDIA 5.4% 3.2%
PHARMACEUTICALS 3.0% 2.6%
PROFESSIONAL SERVICES 5.6% 3.4%
RETAIL AND WHOLESALE 1.9% 0.9%
TELECOMMUNICATIONS 4.9% 3.8%
TRANSPORTATION 3.5% 2.3%
UTILITIES 4.2% 1.7%
ACROSS ALL 15 INDUSTRIES 5.04% 3.16%
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Look for Gains…
© MobileLogix / DispatchLogix 2014
70% of US ProductivityOriginates from….
Forrester 2014
IT / Data Manage/Understand
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Highest Rewards…
© MobileLogix / DispatchLogix 2014
Front End PlanningHighest ROI….
Historic, Virtual
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Lessons from Projects
© MobileLogix / DispatchLogix 2014
Common Faulty LogicMultinational Crews
Massive Project Scales
Estimated Turnaround Time = 3 Hours
Actual Historic Turnaround Time = 3 Weeks
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1 of 1000 Reasons
© MobileLogix / DispatchLogix 2014
Omission of History/BenchmarksMissing Scope Items
Identified Late in Project
10%-15%+ Project Impact
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1 of 1000 Reasons
© MobileLogix / DispatchLogix 2014
Delivery of Steel to SiteOver-Complex Schedules
Logic Ties don’t work
Faucets on 23rd Floor
Delay Concrete on 5th Floor
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1 of 1000 Reasons - Pro
© MobileLogix / DispatchLogix 2014
Use of Collaboration Data – Single Project
• 80% Reduction in Design Time
• 98% Reduction in Number of Field Travel Days
• Less Field Rework for Craft
Source: KPMG
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Planning Overcomes Barriers
© MobileLogix / DispatchLogix 2014
Barriers:
• Code Variations
• Lack of Infrastructure Jigs and Templates
Leading Companies Make it:• Repeatable
• Scalable
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Lessons from Manufacturing - Shipbuilding
© MobileLogix / DispatchLogix 2014
Product Database:
• Products• Production• Reconfigurable for each project
• Standard Modules• Sub-Assemblies• Grouped by Families
Example:
• Plant zones for mechanical systems or public zones for lobbies
• Built in Manufacturing Type Facility to be shipped to jobsite for installation
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1 of 1000 Reasons
© MobileLogix / DispatchLogix 2014
Dive into a Schedules WBSAssociate Costs…
Size of Data Out of Control
Associate Costs to:
3 Day Schedule of Crane
5 Day Schedule of it’s Crew
7 Day Schedule of Materials
1 WBS / PHASE CODE
What is Earned Value Management?
• Earned Value Management (EVM)• Is a project management process that combines schedule performance and cost
performance • Answers the question, “What did we get for the money we spent?”• Has been used since the 1960s by the Department of Defense• Is a central part of CERT and C/SCSC (Cost/Schedule Control Systems Criteria)• Revised and adopted as ANSI/EIA 748
What is Earned Value Management?
The Essence of Earned Value Management (EVM)
Budgetx % Complete= Earned Value
EVM Scenario: Railroad Track
4 miles
4 weeks; $4 million
Contract says:
After 3 weeks of work, only $2 million has been spent.
EVM Scenario: Railroad Track
Sound good?Let’s do an EVM analysis.
EVM Scenario: Railroad Track
1 mile
Only 25% complete. Project IN TROUBLE.
EVM analysis says:
EVM Scenario: Railroad Track
Budgetx % Complete= Earned Value
$4 millionx 25%
= $1 million EV
But $2 million already spent in 3 weeks.At this rate, project will cost $8 million
and take 12 weeks to complete.
EVM: RR Project:
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Simplified Collaboration
© MobileLogix / DispatchLogix 2014
Schedule Cost
Scope
Collaborate
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Benefits of Collaboration8 Steps to Best Practice
© MobileLogix / DispatchLogix 2014
Clear Identification of Task
Broad Participation in Preparation
Availability of Valid Data
Standardized Structure For Estimate
Provision for ProgramUncertainties
Recognition of Inflation
Recognition of Excluded Costs
Independent Review Of Estimates
Clean it Up
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Measure Twice
© MobileLogix / DispatchLogix 2014
Cost Element Valid and Applicable
Labor Includes Time Phase Break Down
Calculations on each element are correct
Program is Accurate TotalOf Sub-Elements
Escalation was applied Over time
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Single Zen = Not in this lifetime…or the nextSplit by - Technology / Disciplines
© MobileLogix / DispatchLogix
Estimating
TimberlineHCSSMaxwellHard DollarCleopatraMC2Others…
ERP
TimberlineDexter ChaneyViewpointJD EdwardsSAPExplorerOthers…
Schedule
P6MS Project
Field
Spreadsheets
Fact vs. FictionTools / Platform Dilemma
Lesson: Prepare to Integrate!!!
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Practical Approach to “Connect the Dots” – Collaborate
© MobileLogix / DispatchLogix
Schedule
Estimate Controls
ERP
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Practical Approach to “Connect the Dots” – Collaborate
© MobileLogix / DispatchLogix
Schedule
Estimate Controls
ERP
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Pick a Problem - Match GameForget about Technology – What do we need??
© MobileLogix / DispatchLogix
Cash FlowProgress
Forecast BenchmarkHistory
Resources
Time (Start / Finish)
Scope (WBS/Activity/Phase)
Activity Factor (Time/Quantity/Fixed)
Historic (Past, Original, Current Approved, Current Commits)
Profit
Actual Costs / Accruals
Got to be all or Nothing
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Pick a Problem - Match GameForget about Technology – What do we need??
© MobileLogix / DispatchLogix
Resources (Factored)
Time (Start / Finish)
Scope (WBS/Activity/Phase)
Activity Factor (Time/Quantity/Fixed)
History (Past, Original, Current Approved, Current Commits)
Actual Costs / Accruals
Estimating
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Pick a Problem - Match GameForget about Technology – What do we need??
© MobileLogix / DispatchLogix
Resources (Factored)
Time (Start / Finish)
Scope (WBS/Activity/Phase)
Activity Factor (Time/Quantity/Fixed)
History (Past, Original, Current Approved, Current Commits)
Actual Costs / Accruals
Schedule
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Pick a Problem - Match GameForget about Technology – What do we need??
© MobileLogix / DispatchLogix
Resources (Factored)
Time (Start / Finish)
Scope (WBS/Activity/Phase)
Activity Factor (Time/Quantity/Fixed)
History (Past, Original, Current Approved, Current Commits)
Actual Costs / Accruals
ERP
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Pick a Problem - Match GameForget about Technology – What do we need??
© MobileLogix / DispatchLogix
Resources (Factored)
Time (Start / Finish)
Scope (WBS/Activity/Phase)
Activity Factor (Time/Quantity/Fixed)
History (Past, Original, Current Approved, Current Commits)
Actual Costs / Accruals
FieldSpreadsheet Paper Time
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Build a Project
© MobileLogix / DispatchLogix
Estimating
Schedule
ProgressMeasure/Collect
Report
Forecast
Finance
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Crossroads – Resource Driver VarianceProject Phase 1
© MobileLogix / DispatchLogix
Cost Model Schedule
Duration Driven
Progress %
Duration Driven
Quantity Driven
Fixed CostDriven
Utilize Cost ModelResource Activity Driver
Fix: Cash Flow, Resource Graph,
Forecast
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Crossroads – Resource Driver VarianceProject Phase 1
© MobileLogix / DispatchLogix
Cost Model Schedule
Duration Driven
Progress %
Duration Driven
Quantity Driven
Fixed CostDriven
Utilize Cost ModelResource Activity Driver
Fix: Cash Flow, Resource Graph,
Forecast
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Crossroads – Resource Driver VarianceProject Step 2
© MobileLogix / DispatchLogix
Cost Model Schedule
Start / Finish
Time Phase Cost Model
Fix: Cash Flow, Resource Graph, Forecast, Accrual
Duration Driven
Progress %
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Crossroads – Resource Driver VarianceProject Step 3
© MobileLogix / DispatchLogix
Cost Model Schedule
ActivitiesStepsResources
Resource/Cost LoadSchedule
Fix: Cash Flow, Resource Graph, Forecast, Accrual
Activities
Activity Factors
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Crossroads – Resource Driver VarianceProject Step 3
© MobileLogix / DispatchLogix
Field Data Schedule
% CompleteCost/Phase/GL
Create “Repeatable” Cost/Phase/GL
Codes:Execution
Fix: Cash Flow, Resource Graph, Forecast, Accrual
Quantity
Activity FactorWork Package
ERP
Reconcile toCost Model
Cost/Phase/GL
“Earned Actual”Build Accrual
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Crossroads – Resource Driver VarianceProject Step 3
© MobileLogix / DispatchLogix
Field Data Schedule
% CompleteQuantities
Drive % Complete From Factor Driven
Field Data Collection
Fix: Cash Flow, Resource Graph, Forecast, Accrual
Man/Equip Hours
Duration
Quantity
Activity FactorWork Package
ERP
Reconcile toCost Model
Cost/Phase/GL
“Earned Actual”Build Accrual
Pass Values toSchedule/ERP
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Heavy Lifting vs. Making Simple
• CPI - Cost Performance Index is .8333
• MHE – Man Hour Production 30% Less than Expected on Crew Performance
• SPI – Schedule Performance Index= $116,000 / $125,000 = 0.93
• Cash Flow does not reflect impact of actual vs. planned performance
• Current Schedule Does not reflect when we will finish based on production
• Average time to receive performance indicators, 32 days after root cause
© MobileLogix / DispatchLogix 2014
Quick Fix
“To Detail or not Detail?
That is the Question.
Whether tis nobler in the mind to sling through piles of data or take arms against it”
Lesser KnownBarry Shakespeare
How much is to much?
Building Perfection in Progress
Progress1. Eliminate Internal Speculation – Determine Consistent Method of Measurement (Qty/%)
2. Report on Summary – Record , Capture Detail
3. Open progress to vendor input on measurements
4. Leverage the schedule for true EVM performance (SPI, CPI)
5. Standardize WBS for consistent current and historical measurement
Create Model for Project Reconciliation against ERP
Now vs. Later
End of Project Real Progress = Actual Hours/Total
Late to modify Performance
Progress by Hours…
ManualProgressPhaseHours/Cost
Hours Spent
Principles Applied
• Budget• Time • Receipts• Progress• Actual Cost• Reconciliation
Common Touch Points - Budget
• Master Data (ERP->Cost Model System)• Job/CR/WO/PO numbers• Cost Codes• Cost Types
• Structure, $, Quantities, Dates (Cost Model System->ERP)• Original Budget• Budget Revisions• Change Requests• Work Orders• Purchase Orders• Forecasts
Common Touch Points – Time Entry
• Master Data (ERP<->FIELD SYSTEM)• Job Steps, Job Types, Pay Types• Employees• Equipment
• Date, Account Code, Resource ID, Hrs, Notes, Weather (FIELD SYSTEM->JDE)
Common Touch Points – Purchase Order
• PO, Line Item, Qty Received, Estimated Value, Date Received (FIELD SYSTEM --> ERP)
Common Touch Points Progress Entry
• Date, % Complete, Quantity Complete, Foreman(FIELD System->ERP or ERP->FIELD System)
• **Also Drives Primavera % Complete Calculation
Common Touch Points
• Reconciling G/L to Job Cost ERP <<->> FIELD System• Accrual of Estimated Actual• Quantity/Cost/Man Hours/Equip Hours• Payroll• Asset Management• Procurement Management• Subcontract Management
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Keys to Success
• Initiate at the Cost Model Estimate Level (Calculation of Production)• Time Phase Costs• Cost Phase Scheduling Activities• Cautious Burden in the Field – Leverage Existing Process• Extend Collaboration (Vendor, Owner, EPCM, Contractor)• Leverage Existing Technology (Last 2 Years = API, Size, Bandwidth)• Core Process, Top Down Strategy
© MobileLogix / DispatchLogix 2014
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15%-30% Results Outcome
© MobileLogix / DispatchLogix 2014
Cost Estimate to Measure Original Plan Strong leadership demands EVM Stakeholders make it clear on accountability Management open to mitigating risk on results EVM at the program level EVM planned detail Use past performance Integrate: Cost, Schedule and Performance Visual Planning, Execution
CoreEVM
Cost Management
ERP
Project Structure
Budget Values (original budget, curr. budget, curr. est.)
End Result - Project Reconciliation – Holistic
CRM
Estimate
Quote Mgmt
ProgressMeasurement
Scheduling(P6 & MSP)
Document Management - SharePoint
Vendor POs
Contracts & Change Orders
Actuals Tracking
HR Master Data
Equipment Rates & Types
Takeoff BIM
Materials Master & Pricing
Vendor Master
Project Number
Pay Items
Project Status
WBS Structure & Dates
Schedule Dates
Current Forecast
Earned Values
(optional) Time Entry (hours & Qtys)
Actuals
Customer, Opportunity, or
Project Information
Estimate Pricing
Doc
umen
t
Link
Doc
umen
t
Link
Material Qtys
Field DataMobileLogix
Control Tower
Time Entry (hours & qtys)
MobileField Collection
MobileLogix
Send SAP Vendor and Material Data to Field System
Receive Budget Values from Cost Model into SAP WBS
SAP Actual Quantities and Dollars Compared to Original Budget
EVM to SAP (QTY/% Complete) % from Field Data System
Forecast Dollars & Quantities from Field Data System to SAP
Field Data Pay Items to SAP for AR & Revenue Recognition
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Core Collaboration – Non-glamorous
© MobileLogix / DispatchLogix
AFE’sAccount Codes
Cost CodesCost
GL CodeAccount Codes
Cost Codes
GL CodeAccount Codes
Cost CodesWork Package
AreaDiscipline
Quantities (Unit)Man / Equip Hr
%
Account CodesCost Codes
AreaDiscipline
Rules of Credit / %
Estimate / Planning Accounting
Field ExecutionCollaborationExternal
Redefining Customer Service
Re-Define Customer Service
• Expectations Schedule Time
• Visibility Performance
• Communication Throughout Field Touch Points
Number 1 Field Complaint = “Where is my person?”
See Every Activity…
• Project Status
• Plan vs. Progress
• % Complete/Qty Update
• Cash Flow, Earned Value
• Resource Planning
• Exception Alerts
• Expedite Invoicing
Visibility:
Answer: How the Project/Work is doing….
Web / IPAD Based “Control Tower” View
Launch New Activity
Add/ModifyEquipment
ScheduleSub/Crew
Todays Tasks within the Project“Play of the Day”
Scheduled/Assigned Activities
Vehicles/Equipment Requiring Maintenance
Material Add/Search/Location
Activity Assigned on Resource Expertise
Transparent Field to Plan Comparison
Schedule of Activities
Work Package A
Work Package B
Work Package C
Planned / Estimated Execution / Controls Owner / Reporting
Cost / ProductivityQty / % Complete
Planned vs. Actual Performance Comparison
Transparent Field to Plan Comparison
Schedule of Activities
Planned / Estimated Execution / Controls Owner / Reporting
ACTIVITY ID / WORK PACKAGE Schedule ID
Cost Code / Account Code Rollup
Schedule ID ACTIVITY ID / WORK PACKAGE
Owner ReportsCost Overrun
Past Due ActivitiesRoll Up Cost Codes
Manage Vendors and Self Perform Work
View Today’s Assigned Jobs“Play of the Day”
Including Resources, Material, Equipment.
Categorized by:Sub Contractor’s
Self Perform Work
Assign Unscheduled Activities
View Unscheduled ActivitiesTo Assign
Attach Images and Notes from Field
Insert User Based Reminder Notes for Daily / WeeklyTasks
Activity Scheduler
Schedule Daily ActivitiesBy Craft Expertise, Availability
For weekly planning
Joe’s crew is available andIs qualified to performThis weeks activities
Organize Work Types and Categories
Work TypesBy Classification Category
Water Treatment
Material / Inventory Reorder Alerts
Receive Inventory ReorderAlerts On Material for Operations,
Construction, and Equipment
Vehicle Maintenance Management
Real time updates visible in Control Tower
Vehicle / EquipAssigned to Sub / Supervisor
Update / AlertVehicle / Equipment
Maint. Records In the Field
Past/Present View of All Activities/Resources/Equipment/Vehicles
View Current Location of Sub/Self Perform
View Current Location of Equipment / Vehicles
View Status of Jobs by Location
View Historic Activity/ResourceBy Activity ID
No Service RequiredNo App to Download
No Batteries to ChargeNative to Device
Field to Control Tower Workflow
Field Select ActivitySelect In ProgressSelect Complete
Time/GPS Reflected in Record
Updates from Field on All Activities
Are displayed in Control Tower Status
Safety Certification Reports / Meetings
Sub Contractor Insurance On File
Safety Qualification
Meeting Requirements:Pre Construction Meeting
Site Safety OrientationForeman’s Site Requirement Review
Foreman’s MeetingSafety Review
Daily Safety Walk Around Checklist
Quick Start Set Up…
Leverage existing• Configure All Master Data
• Employee Master• Inventory Master• Vendor Master• Equipment Master• Material Master
Connect master data with Event Monitor for Master Data Updates
Anatomy of a Project
Project
Job Type
Job
Work Type(Activity)
Work Package
Job Skill
Labor Rates
Hours
Price
Material
Unit Cost
ServiceableAssets
(Recurring)Location
Vehicles
EquipmentStaffSchedule
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