Call To Action

[00:00:00] Kristin Buettner Khuri: And it is my pleasure to introduce Gary Fischer, PPI’s executive director. He will be presenting his call to action. You can share your screen now. I will very briefly introduce you. So as I mentioned, Gary is the executive director of the institute, as well as chair of the PPI Energy Working Group. Prior to that, Gary spent 40 years at Chevron’s capital projects organization and has held a variety of executive positions.

[00:00:29] Kristin Buettner Khuri: Most recently as special projects manager at Chevron project resources company. In that role, Gary was responsible for Chevron’s implementation of project production management and digital transformation on major capital projects. Gary was also responsible for Chevron’s project management system

[00:00:54] Kristin Buettner Khuri: and led the group that provided functional expertise across the corporation’s worldwide major capital projects portfolio. He holds a Bachelor’s of Science degree in civil engineering from Colorado State University and is a licensed professional engineer in the state of Colorado. All right, Gary, over to you.

[00:01:15] Gary Fischer, PE: All right, very good. Thank you, Kristin. Well welcome everyone to what is going to be a, I think, a super interesting day and a really wise investment of your time. I’m going to open this symposium with just a little bit of reflection on what we see happening around us in the world, and conclude on how important it is to fundamentally change how projects are developed and executed.

[00:01:33] Gary Fischer, PE: So let’s get started. You know, as the world is emerging from the Covid crisis, we can clearly see there are three global trends that will dominate and really overwhelm the global capacity to develop and execute capital projects. As you can see, infrastructure, digitalization, and decarbonization, which is really the driving force behind the energy transition.

[00:01:57] Gary Fischer, PE: Now I’m going to touch on each of these and explain why we think these are important trends to follow. One recent study revealed that between now and 2060, the world’s population is going to be doubling, and just the amount of building floor space required for that will be equivalent to building an entire New York City every month for the next 40 years.

[00:02:23] Gary Fischer, PE: Let’s stop and think about that – every month for the next 40 years – a New York City. That’s just almost incomprehensible to me. So soak on that. The pandemic has accelerated the change in the digital landscape, forcing companies to either adapt or go out of business. 5G is already changing the way digital networks are being used, and from what I understand, 6G is just around the corner.

[00:02:49] Gary Fischer, PE: The new gold is data and that requires infrastructure in storage and transmission. Now layer on top of this, the move towards electrification is the primary energy source displacing hydrocarbons while meeting the infrastructure demands of the digital economy. Behind every energy technology are the raw materials that power it, support it, or help build it.

[00:03:16] Gary Fischer, PE: The energy transition is moving to technologies that are far more mineral intensive than current fossil fuel counterparts. For example, a typical electric car requires six times more mineral inputs than a conventional car. And an onshore wind plant requires nine times more mineral resources than a gas fired power plant.

[00:03:36] Gary Fischer, PE: According to the International Energy Agency, an estimated 100 trillion, I can’t even imagine that number, will be required over the next three decades to reach net zero carbon emissions by 2050.

[00:03:54] Gary Fischer, PE: These three big trends compound on each other. As you can probably see. Consider the demand they place on the basic materials such as copper, steel, concrete, glass, fibers, plastics, and then the skilled labor that we’ll take to require to do the work. By any estimate, the available supply of building block materials such as lithium, copper, iron, ore, rarer, cannot meet the projected demands.

[00:04:16] Gary Fischer, PE: So new mines and refining facilities will also be required, for example. The recent World Bank’s Climate Action Report charts the 2050 demand for 15 minerals needed for energy technologies. And you can see here lithium up 500% versus 2020 production, cobalt 460%, graphite, 400%, indium 192%. So it’s important to realize that because these trends are interrelated, they do compound on each area.

[00:04:50] Gary Fischer, PE: For example, I thought this was really interesting. I had no idea this was the case, that 50% of the carbon attributed to infrastructure is generated in the construction phase, not in the operation of the life of the asset. So in order to meet the decarbonization goals, infrastructure has got to take aggressive action during construction.

[00:05:13] Gary Fischer, PE: So digitalization requires infrastructure, cell towers, data centers, electrification, increases demand for both digital and infrastructure, solar, wind, nuclear, transmission lines, charging stations, and battery storage. So if that didn’t shock your brain enough, let’s layer on that. The dearth of people who want to work in construction.

[00:05:35] Gary Fischer, PE: By any forecast, if we don’t change the methods we use to execute projects, we just won’t have enough craft workers to do the work in the U.S. for sure, let alone what is going to be needed globally over the next 30 years. So it’s pretty easy to see that these trends together will create unparalleled challenges and strains on the construction industry material and equipment suppliers, along with those who mine and refine basic raw material.

[00:06:05] Gary Fischer, PE: In fact, we believe these trends will actually pace our capacity to develop and execute the underlying projects rather than the other way around. So we believe, to have any chance of meeting these challenges, real change is required. Improved productivity of the construction industry is just no longer a good idea, a money-making idea.

[00:06:26] Gary Fischer, PE: It’s an imperative idea. Here at the Institute, we believe the time for business as usual is rapidly closing. The pain of the status quo in construction is going to increase exponentially as our capacity to develop and execute projects fall short of expectations. Hopefully now I have your full attention, and until we recognize that projects are production systems and use the science that drives project results, we have zero chance of making significant improvement.

[00:07:02] Gary Fischer, PE: It’s just not going to happen. However, even that won’t be enough. We need to free ourselves from the prior errors and focus instead on a new error of project delivery. One in which projects will be highly efficient production systems that are automated with robots doing much of the work. Embedded sensors will be tracking materials and signaling for subsequent work to be done.

[00:07:24] Gary Fischer, PE: Drones will be measuring progress. AI-enabled systems will be ordering materials directly from suppliers without human hands. Facilities will be configured to order. Components will be 3D printed on demand on site. Workers with exoskeletons will be used to assemble components designed in just a completely different way from today’s methods.

[00:07:46] Gary Fischer, PE: And this isn’t just fantasy. Think about how rapidly our lives have changed in just the last few years. Stop and think about your cell phone. Hey, we all have one. Not only can I communicate with people globally, I can bank on it. I can order food to be delivered to my home. I can order just about anything and have it delivered just about anywhere.

[00:08:07] Gary Fischer, PE: And one feature I absolutely love is that nice lady giving me directions so that I don’t get lost as often and creating really marital harmony in our household. So just imagine for a moment that first Ford factory, it was an amazing leap, Ford into auto products. Making auto ownership affordable for the average family.

[00:08:33] Gary Fischer, PE: Now, fast forward to today and visit any vehicle factory, robots silently working down the line, doing things just unimagined. A few years ago, millions of parts showed up just at the right place at the right time every day. Consider how the auto worker’s job today is really quite different than that first Ford factory.

[00:08:52] Gary Fischer, PE: Well, from my point of view, construction today is very much like that first Ford factory. Yeah, we do some really amazing things all over the globe, but not nearly as amazing as what we could do and must be doing in the project of the future. So today you’re going to hear industry practitioners and experts talk about their experience managing projects.

[00:09:14] Gary Fischer, PE: Using production systems and using science to drive performance. You’re going to hear about the needs of industries like life sciences and the energy transition and how PPM can help. Finally, later today, you’re going to hear some really exciting news defining that new area of project delivery through the project of the future, and you really don’t want to miss that.

[00:09:34] Gary Fischer, PE: So I suspect today you’re listening because you already know what PPM can do and you want to learn more and enhance your skills. That’s great. Or you’ve heard about this from someone and you’re curious, or you’re a prisoner, and here because someone expects you to be using PPM, and you can say, I’m going to figure out what this is all about.

[00:09:53] Gary Fischer, PE: In any case, regardless of why you’re here, we’re glad you’re here, but I want to challenge you to shake off the status quo, open your minds up and lean into using PPM to start this transformation of how we develop and execute our projects. Real change is not something they’re going to do. Real change starts with you, every one of you, and I promise, ultimately, if you give this a try, you’re going to be rewarded for having the courage to. try it.

[00:10:25] Gary Fischer, PE: So thank you and let’s have a really good day.