Project Baseline

Baseline is a defined and agreed starting point of the implementation, and for the future measurement and comparison. A Project Baseline is a basis of contractual responsibility (baseline) which is clearly defined and agreed between contract parties prior to commencement of the project, and a fundamental basis of measurement of the project completeness. The Project Baseline is a project management and control tool to help a solid understanding of the project for all internal and external project members.

Project Baseline Document is initially developed by a proposal team and further updated by a project team during the project execution. The Project Baseline Document should be prepared and developed with accurate information, and implemented from the project kick-off, however it can be started with existing information that have been prepared for the proposal and developed for the project initiation, and should be updated as per the detailed project planning and execution under the project manager’s responsibility. Practically, the Project Baseline consists of Contract Basis; Scope of Work; Project Schedule; Commercial terms and conditions; Project Execution Plan (PEP) include Project Risk Management, and other critical specific requirements of the project.

Baseline Centric is the Fluor's symbol mark. Fluor's Baseline Centric execution focuses on client satisfaction. Fluor uses the Baseline Centric strategy to align their expertise with the clients' objectives regarding project function, scope, cost, schedule, contracts, and execution. The collaborative nature between front-end engineering and design, and project construction controls the development cycle, and a solid baseline is a firm foundation from which to build.

Planning Process: A Project Manager establishes the PEP (Project Execution Plan) with consideration of project constraints (cost, schedule, quality, and safety) and project requirements to achieve the project goals and objectives.

Documentation: The Project Baseline Document is not a separate project plan or procedure. These are updated proposal information and developed plans during the project initiation and planning stage.

Implementation: The Project Baseline should be approved by the company management prior to implementation as well as recommended to have an agreement with owner. The Baseline Document is a base of the project execution plan and procedures, and should be allowed project key personnel to easily access.

Update: A Project Manager with project key personnel’s supporting is the responsible for updating and maintaining with the latest baseline information. Any Variations should be recorded and reported.

Contract Basis for the Baseline (Contract Summary) is a summary of contract terms and conditions, focused on the directly involved in the project execution (scope of work, liability, payment and change management, etc.), and prepared by the project language and terminology rather that the legal. The Contract Basis for the Baseline Document should be developed by a project manager (PM) and reviewed by a legal department prior to publish, and shared with the project key members as a project baseline document.

Scope of Work (SOW) is to be provided works including services (tangible and/or intangible) by a contractor against an owner’s compensation based on the contract and related terms and conditions. A SOW can be further detailed as Scope of Facility (SOF, hardware) and Scope of Service (SOS, software). The Contract Scope of Work (SOW) is a foundation of the contract and project baseline. The Contract SOW document is initiated by owner included in the ITB (Invitation to Bid), and developed and proposed by contractor, and finalised after clarification and negotiation meeting between owner and contractor, and included in the contract document. The project execution members including a project manager should review the project Contract Scope of Work (SOW) document and agree them with internal and external organisation before the contract is signed.

Scope of Facility (SOF) is a part of the Scope of Work (SOW) that is mainly tangible assets. A SOF is the brief overview of the project facilities to be designed and constructed under the contact, and clearly defined the capacity of a plant or each unit and technologies including the process performance and utility consumption. Major critical equipment and equipment list can be added, and owner's providing items should be listed.

Scope of Service (SOS) is an effort service (intangible) based on experience and knowledge. A SOS is a brief overview of the services to be provided including specific major activities in project management, engineering, procurement service, construction management service, and commissioning and start-up service, etc. A SOS is specified estimated resources amount and mobilisation plan, etc., in the contract document.

Project Baseline Schedule is usually a project Control Level Schedule (Level 3) that is developed during the project planning and early execution stage with a proposal document which was an initially developed project execution schedule for the proposal. The Project Baseline Schedule indicates entire project time frames and contractual and project key milestones roll down into the Project Control Level Schedule from the Level 1 (Project Master Schedule) and Level 2 (Project Summary Schedule). 

Commercial Baseline is the basis of the proposal estimate terms and conditions that includes the project execution plan, design and engineering basis, staffing plan, equipment tagged item list and quantity, bulk material BM take off, and construction implementation plan, subcontractors pricing basis, and other commercial basis such as applied company over head and profits, bonds, insurance, taxes, contingencies and allowances, etc., as well as the Project Risk Management cost and project contingencies. The Commercial Baseline is documented and updated them as necessary during the contract clarifications and negotiation meetings with owner, and hand-over to the project team for the Project execution. 

Project Execution Plan (PEP) is the governing document for the project operation and management that establishes in appropriate terms what will be done to meet the project scope and contractual requirements. A PEP is to describe a project specific plan in strategic and tactical way, addressing the most effective method and maximise efficiency in the project execution, and the project specific actions complying to project goals and objectives, and the clear scope of work and other critical responsibility as agreed in the contract as well as detailed Project Risk management plan including risk items and mitigation plans which was assessed and evaluated during the proposal stage, and action plans for the project execution in accordance with the company risk management procedure. A PEP is developed by the project key participants led by the project manager that is one of the project baseline documents, and should be approved by company management prior to publishing or applying. A PEP is a live document and should be updated with current and future project plans and procedures.

As Sold Profitability is calculated in order to provide a measurable financial benchmark for evaluating project performance as the project is being executed. The As Sold Profitability is established at the time of contract award based upon agreement between the project business team and execution management that is the baseline of profit performance expected from the project management.

Baseline Risk Assessment is an assessment process to obtain a benchmark of the type and size of potential hazards that is a significant impact on operational activities, processes, and systems-based business functions. The Baseline Risk Assessment focuses the identification of the risks within a task, process, or activity, usually associated with the management of change.

Control Base is the established baseline (e.g., Scope, Cost, Schedule, and Performance) against which project performance is measured and controlled that serves as a reference point for comparing actual progress, costs, and schedule against the planned targets. The Control Base is developed as a taken-off from construction drawings that is a quantified basis represented a true picture of service or materials to be installed. Once the Control Base is established, project controls are used to monitor and measure actual project performance against the baseline.

Contract Budget Base (CBB) is the basis of the negotiated, estimated, and contracted cost of the agreed scope of work and service between an owner and contractor. A CBB can be the additional authorised un-priced work, or the performance measurement baseline (PMB) plus management reserve (MR) which is an amount of the contract budget developed by the project manager at the beginning of a project. (Refer to the Control Budget)

Control Level Schedule (Level 3 Schedule or Network Schedule) is an actual project schedule control and management tool for a work level. The Project Control Level Schedule is integrated detailed EPC activities for the entire project scope of work based on a Critical Path Method (CPM) used a network scheduling technology with detailed input all major milestones, major elements of design and engineering, procurement, construction, pre-commissioning, and commissioning activities. The Project Control Level Schedule shows detail and individual work tasks and clearly defined works by discipline or responsibility. This is a first level of detailed schedule that a meaningful critical path management can be performed to monitor and manage the overall project work accurately, and usually basis of a look ahead or window schedules for the project schedule control and management.

Design Change Control is a systematic process of the design changes that is the most challenging aspects and most important matters of the successful project execution. Early identification of change items is the critical to manage and minimise the negative impacts by all members' responsibility. An Engineering Manager is a primary responsible person for ensuring the design change processes that is fully implemented and evaluating the impact of the engineering baselines such as deliverables, technical matters, resources, etc., with discipline leads and other project team members, and communicating with a project management.

Over Target Baseline (OTB) is an overrun to the contract baseline that is a new baseline for management when the original objectives cannot be met, and new goals are needed for management purposes. The contract baseline is not adjusted as a result of the Over Target Baseline (OTB).

Over Target Schedule (OTS)