In this episode, Riccardo Cosentino is joined by Oxford classmate, Vicente Cunha, to discuss his MSc in Major Programme Management dissertation on early completion payment as a mechanism to incentivize collaboration in major programmes. The pair dive into the importance of trust and transparency in major programmes and our industry’s struggle to implement either. Cunha explains why a shift in mindset and a touch of empathy could be a gamechanger for major programmes.

Cunha is an accomplished Industrial Engineer and with over 15 years of experience in the oil and gas industry, primarily focused on delivering complex construction projects involving large oil and gas floating production units. He brings a wealth of knowledge and expertise to his work, affording him a critical perspective on the integral factors behind the design, procurement and management of large construction contracts. He is particularly passionate about forging a strong alignment between in-house construction and operations teams and establishing productive and collaborative relationships with all project stakeholders, to achieve the best possible outcome.

Key Takeaways: 

• The six must-have, evidence-based contract specs that should be included on projects to improve results.
• Why early completion incentives do not necessarily lead to better outcomes.
• Red flag behaviours to avoid for effective contractor collaboration.
• Relational contracting vs traditional contracting and the importance of risk balance.
• The truth about where empathy and major programmes intersect.

The conversation doesn’t stop here—connect and converse with our community via LinkedIn: 

Riccardo Cosentino’s LinkedIn: https://www.linkedin.com/in/cosentinoriccardo/  

If you enjoyed this episode, make sure and give us a five star rating and leave us a review on iTunes, Podcast Addict, Podchaser or Castbox.

The conversation doesn’t stop here—connect and converse with our community: 

• Vicente Cunha’s LinkedIn
• Riccardo Cosentino on LinkedIn

Transcript:

Riccardo Cosentino  00:05

You're listening to navigate the major problems, the podcast that aims to elevate the conversations happening in the infrastructure industry and inspire you to have a more efficient approach within it. I'm your host Riccardo Cosentino a brings over 20 years of major program management experience. Most recently, I graduated from Oxbow universities they business group, which shook my belief when it comes to navigating major problems. Now it's time to shake yours. Join me in each episode as a press the industry experts about the complexity of major program management, emerging digital trends and the critical leadership required to approach these multibillion dollar projects. Let's see where the conversation takes us. We sent a Konya is an accomplished industrial engineer who has an impressive MSc in major program management from the prestigious University of Oxford. He is a seasoned professional with over 15 years of experience in oil and gas industry primarily focused on delivering complex construction projects involving large oil and gas floating production units V Center brings a wealth of knowledge and expertise to his work, affording him a critical perspective on the integral factors. Beyond the design, procurement and management are large construction contracts is particularly passionate about forging a strong alignment between in house construction and operation teams, and establishing productive and collaborative relationship with all project stakeholders to achieve the best possible outcome. All right, and welcome to navigate the major programs, a new episode today with the center kuliah. Are you doing the center? Hi, Riccardo,

Vicente Cunha01:47

I'm doing great. And thanks for having me. It's a great honor to participate in Afghani measure program.

Riccardo Cosentino  01:52

It's my pleasure. And thank you for agreeing to meet with me today. Today we're going to talk about a very interesting topic that you are quite familiar with, which is early completion payments as a mechanism to incentivize collaboration in major programs. Can you tell us about this topic? And why are we exploring this topic today?

Vicente Cunha02:12

Yeah, I actually did a dissertation about that, in my master's degree in Oxford for in mega projects, the idea is to try to understand if you include one early delivery incentive in a contract, if that would make the performance of the contract to go any better than than what we actually see. And so the paper talks about long run and complex construction projects. It's not really not about like paving a few miles of an existing freeway over the next six months. Not that paving a freeway isn't hard worker cannot go wrong. But we're looking for projects with a higher degree of innovation, higher likelihood of stakeholders conflict, longer duration, expositions, uncertainty, and so on. So if you look at the traditional lump sum, fixed price, EPC contract and where contractors would compete for the lowest price to deliver a fixed scope, the dissertation starts from there. And the idea that if you have a higher degree of owner and contractor collaboration, it would have a better outcome for the project, we try to figure out that the incentive itself would booster that collaboration. The idea would be something like, let's say we have a conflict there. And I decide not to pursue what I think it's right. Because I'm looking for something else. In the end, that would be like the bonus for early delivery. That's the idea of the dissertation.

Riccardo Cosentino  03:34

Interesting. Maybe for the people following us for the first time, what's your background? What What inspired you to look at this particular topic,

Vicente Cunha03:43

I've been working in high complex, long run projects for for a while for like the last 15 years. So I work with shipbuilding, construction, oil and gas platforms. And what I found is that it's really hard to keep a project on track, my experience is about like a five year running project. And over time, we face so many difficulties that at some point, we are not talking about the target date anymore, and cost escalates and everything that's there in the literature. And it's very common in many projects. So I start thinking, what is wrong there? And how can we actually make sure that both owner and contractor are looking at the same picture and trying to do their best effort. And at some point, we had a great opportunity, stopping for a while before the project that I'm working now. And we put a group to study it and see what can we do better for for the next contract for the next project. And we came with some of the things we're going to talk about today. It's just all there in our new contract, and we are trying to figure out how to get better. And one of the thing is, is putting their incentive for early delivery. And then that's just the true question that came from my my work. Is it working or not? Is that the way to get a better outcome? I still don't have the answer in my actual works. It's just running out the incentive Is there and I can tell yet how the end of the story on my personal work is going to be. So I decided to jump ahead and try to figure out in th...