Client Story: Honeywell

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Introduction

Honeywell is an engineering and technology company which invents and manufactures technologies that address challenges across multiple sectors, including energy, security, safety, productivity and global urbanization. Its annual revenue is over $30bn.

Jeff Hopkins, Vice President of Global PMO and Intelligrated PMO, and Roman Vorel, VP, CIO Engineering & GPMO, explain how Cora helped them to cut cost overruns by $450M in 8 months.

Transcript

So, I’m looking after about $6 billion of projects revenue across six business units. We have our aerospace business; we have our Honeywell Building services, our Building Solutions business that does a lot of security, fire and HVAC. We have our Honeywell process solutions. There’s a lot of automation Intelligrated which is the business I’m embedded with which does warehouse automation, so think 1.6 million square foot distribution centers with conveyor and robotics, all that kind of stuff. Smart energy is exactly that. It’s smart energy meters and then UP engineering and projects is doing a lot of work within the oil and gas industry. As you can see, a very diverse portfolio, we have projects that range from 25 to 50,000 that happened over a weekend and we have projects that are half a billion dollars that span over multiple years. So, a breadth of types of projects, size of projects and a very global footprint.

We are dealing with seven SBG’s in Honeywell, where we’re deploying this and historically they operate in a different way. One would manage a project this way. These guys are on Level 3 maturity. These guys have never seen a tool. So, you have different foundations and so this allowed us when I came on board to reset. We scared everyone. Everyone started to be super worried, but now we have full control and everyone on board and when we’re introducing a change, everyone needs to know they need to come to change Control Board with everything documented; all parties aligns to it and we really are very careful with introducing any changes to the core and that’s because we have so much versatility and we need to run with a tremendous speed and I will show you our road map. It’s super, super aggressive so this became very important for us. It’s how we created that value, right. So, we start the scheduling, the project tracking, that’s the project information, the milestones, Risks and some dashboarding, the time and resource management that’s really about the resources, capacity planning and the timesheet management and then we’re getting basically to that fundamental part that the whole leadership is waiting for, which is where we expect the biggest value to be delivered. But even by I don’t think the first one we have started to see a huge value just by the fact that one leader can look at the entire portfolio of a $6 billion industry and seeing the risks across all the projects in one tool in one dashboard just by click of a button and, you know, people are saying, we have that. Yeah You guys have that this guy doesn’t have that, and that’s what this brought. We use Jira in the backend, and we use Cora in the front end.

Now one of the great things we figured out is when we started this, we had spreadsheets, we had Smartsheet’s we had Microsoft projects, all sorts of other tools and I was like we’re delivering Cora, guys. Right, we should use Cora to project manage the Cora delivery and isn’t that fantastic, It’s very simple. We didn’t figure it out early and we figured it out later, luckily, but it’s been fantastic, That actually your people start using the tool and presenting the business. Hey, we’re going to be deploying schedule and your using Cora schedule to show them where they are, using Cora risk register to show them, hey, these are the risks that we have on the project. So instead of doing presentations during the target reviews, we actually get into this plan and say ‘ok guys we’re going to be doing release one pilot and here are the major steps that we need to achieve’. We unclick it and we show them what’s going to happen and it has proven as a fantastic thing. It brings people on board and it helps us to collaborate better. Cora is really the planning engine and the triggering engine that drives and determines what those financials are going to look like. So, if I pick an example, you have timesheets, so you would be entering time in Cora and that in Cora you would define how many hours per which resource. But my ERP system calculates and converts the hours to the cost. So, what I do is a bidirectional integration where on one way I enter the time in Cora because I want to have one PM experience. I want my PM’s to sit just in Cora. I want my back office to do invoicing in SAP, but my PM doesn’t need to do that. My PM says in Cora this milestone is ready to be built so move it and it’s executed in the ERP system, but then I’m bringing those costs back because then what I want to do is to do the forecasting and I want to have the end-to-end view of my project in terms of the actuals and the plan. So, it’s bidirectional integration. ERP is still the financial system of the source of truth and Cora is the operational management system and the one source of truth for the PM’s.

We’ve been doing this for eight months and in that business alone, by all the things we implemented we reduced our cost overruns by about $200 million and we identified $250 million of change orders that we hadn’t gone after because we didn’t detect them. You know, just with some of these changes, so simple changes can have a huge impact on the projects. These projects are at very low margin generally. It doesn’t take much to really take them off track.

 

  • Managing $6bn of projects revenue across six business units (including aerospace; building solutions; process automation; warehouse automation; smart energy; and oil & gas)
  • Projects ranging from $50k weekend projects to $500m complex projects happening over multiple years
  • Each business unit managing projects in a different manner, i.e. operating a) different business processes and b) from different levels of IT maturity
  • Needed to re-set so every business unit is aligned and operating with same business processes

  • Rigorous standardization, e.g. when introducing a change, everyone has to come to Change Control Board, with everything documented, so all parties are aligned
  • Efficient schedule and project tracking, i.e. project information, milestones, risks, dashboards, time & resource management
  • Leadership can easily analyze entire $6bn portfolio and see all the project risks from one dashboard in an instant
  • Cora platform used to deliver the Cora implementation, radically improving collaboration and staff buy-in for the solution
  • “One single source of truth” for operational PPM, including direct link to financials

  • $200M reduction in cost overruns in 8 months
  • $250M undetected change orders identified
  • Migration of 30,000+ projects (each project containing 200+ data points) and 5,000+ users in a matter of weeks – without business disruption
  • Scalability in number of users – from 20% on old platform to 50% with Cora

“We’ve been doing this for eight months. In one business unit alone, by all the things we implemented we reduced our cost overruns by $200 million and we identified $250 million of change orders we hadn’t detected because we hadn’t gone after them. Simple changes can have a huge impact on projects because these projects are very low margin and it doesn’t take much to take them off track.”

– Jeff Hopkins, Vice President GPMO and IGS PMO, Honeywell

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