Project Talk

Project oversight is a two-way process, though, and how one approaches oversight and the results can be ineffective if social intelligence is not in play.
By Sven Swenson | November 28, 2022

In a previous edition edition of Project Talk, I caught up with Ugo Santone, a project management aficionado and partner at PTAG, a project management services firm. We explored the wise concept of “Inspect what you expect,” which Ronald Regan fans may remember as “Trust, but verify.” Whatever you call it, nothing should be taken for granted when dealing with large capital projects. Proper project controls should be in place to alert you if things are going off the rails, but one problem is that project controls and their associated metrics provide largely high-level lagging indicators. These are fantastic for many purposes and very useful for keeping a project steered in the right direction, but they don’t tell you what’s going on in real time. For some issues, by the time you see it in feedback from project controls, you may not be able to prevent going off the rails. For real time feedback and intelligence to protect a project from issues that may be difficult or impossible to recover from, eyes in the field are needed. Those eyes are called oversight.

This article will delve a bit deeper into “Inspect what you expect,” and include input from Herb Marshall, the man who literally wrote the book on project oversight. The book is called The Project Oversight Guide, and his company is Oversight Advantage. Marshall would argue that, just like project controls, which can provide a 10% overall cost improvement for a 3% investment, good oversight is something that costs hard cash in the project budget. But it more than pays for itself by keeping the project on the rails and improving the predictability of the project’s outcome.

Experience in Oversight
I caught up with Marshall virtually from his fortress of solitude in an undisclosed location, and we discussed how he got to be such an expert on oversight. He offered that he went through many years of on-the-job training in Naval Reactors, an organization that spent the past 75 years developing a culture of oversight. Oversight was just something done because it provided for well-informed—and thus, well-run—projects. As for me, I started directly out of college as a yardbird at Mare Island Naval Shipyard, and was introduced to the culture of oversight from the beginning of my career. (A yardbird is one of the more euphemistic terms for a civilian shipyard worker.) 

Marshall rose from the ranks to lead the reactor servicing team at Puget Sound Naval Shipyard, which, at the time, was doing more refueling and reactor servicing work than any other facility in the world. This team included dozens of oversight personnel digging into not only the typical complement of four or five vessels from the nuclear fleet undergoing overhaul, but also the shipyard itself, including the dry docks and other equipment and systems used to perform the work. When he was asked to help a private utility with a large project that was failing (which he did with great success), Marshall recognized that there was simply no legitimate information available regarding how to oversee a large complex capital project—thus, the book.

The concept may seem simple: Eyes in the field providing feedback and intelligence to the owner allows for self-correction. The execution, however, can have interesting results if not approached with the right mentality. Marshall recognizes the need for emotional intelligence, and likes to use an example of building an extension on your house. If you’re paying someone to do it, everyone who’s been down that path knows that you have to watch the contractor “a little bit.” You can’t just sit back and drink piña coladas, waiting for the contractor to tell you it’s done. At the same time, if you’re out there in the contractor’s business, redirecting his workers and interfering with his self-governance, you can end up in litigation. Good project oversight advocates for the owner’s interests for a win-win, identifying underperforming contractors or hidden issues sooner than later, while at the same time allowing the project team to do its job unencumbered. Underperforming contractors can improve performance based upon this feedback, and the now-revealed issues can be corrected in the field before horribly impacting downstream activities. And this is all done without telling anyone what to do. Rather, it simply exposes these issues to light.

Another important takeaway is that oversight does not direct. Oversight’s role is to step back, look at the big picture and recognize things that those who are too close to the action may not, and also delve deep into issues to ensure records support quality completion. Failing to recognize that the foundation the addition is built upon is substandard until after it is complete and starts cracking is not happy times. Oversight can and often does look at the concrete mix records for just that reason, as well as weld records, examination and testing results, and other important documentation that may be available. For important equipment, they can also perform receipt inspection or site surveillance to ensure what was ordered is made the way that is expected.

So, oversight needs to step back and look closely, which is why Marshall’s company logo is a combination of a telescope and a magnifying glass. It’s all about seeing what’s coming down the pike, assessing risks and how they are being mitigated, and whether or not the contractor gets it. It’s also digging into critical details in a way that cannot be provided by standard project controls. Even things like body language at the production meeting, or scuttlebutt about the latest people to drag up and leave the project, provide good inputs to oversight, painting a picture long before an issue becomes evident by other means.

Oversight is a two-way process, though, and how one approaches oversight and the results can be ineffective if social intelligence is not in play. This is why Marshall trains all his oversight people. If he was king for a day, Marshall says that he would create an oversight credential similar to the project management professional certification, providing initial training and certification followed by periodic refresher training. As that does not exist, Marshall created it for his projects. Personality, as well as social and emotional intelligence, are certainly included.

Influence of Personality
Because human interaction is really where the rubber meets the road, Marshall dedicated two chapters in his book to oversight behaviors. He offers that oftentimes—far too often—large capital projects result in litigation, and a lot of it boils down to personalities. When some organizations assign the typical alpha-personality project manager to oversight, it initially seems like a good fit (you want someone intelligent, who understands the project). Project managers usually fit that bill nicely, but in reality, it doesn’t always work out, since the interface is likely with the contractor’s own alpha-personality project manager. As issues arise, so does conflict, typically, as those alpha-personalities battle each other to the detriment of the message.

To counteract this tendency, Marshall uses a five-rung ladder to describe the methods and overall tone of providing feedback. The most organic and pleasant is the lowest rung: referent power, where one is able to get people to follow them based upon their personality and charisma. The highest rung is coercive power: “I’m not going to pay you unless you do it my way.”

The second rung is “expert power,” where a book is cracked open to get technical. Reward power is the third rung, where the contractor has a chance to save face if he’s not exactly right, and show empathy when he runs into issues beyond his control. The goal is to stay in those first three rungs. Oftentimes, improperly performed oversight jumps right to the top two rungs: legitimate authority (I’m the owner, do what I say), and coercive power (I’m not going to pay you, unless you do what I say).

There are a host of subtleties with great oversight, and although Marshall and I had a lengthy discussion, we just scratched the surface. Keep in mind that the goal of oversight is for everybody to win, especially the owner.

Author: Sven Swenson
Senior Vice President of Technical Services
Delta Energy Services LLC
[email protected]