I am going to accept your blog posting but would urge you to at least go back and look at what Lita Lianna did http://pmworldjournal.net/article/using-analytical-hierarchy-process-determine-appropriate-minimum-attractive-rate-return-oil-gas-projects-indonesia/ and select the most appropriate MARR based on her research and not just randomly pick 15%?

BR,

Dr. PDG, Jakarta

Here is the OFFICIAL rate- https://tradingeconomics.com/indonesia/inflation-cpi So why didn’t you reference this model in your research?

See where I am going with this? You are making predictions and you are doing a good job of it, but you never validated or tested your ASSUMPTIONS first.

Bottom line- you are doing a great job but I worry that so many of you are writing up these postings like they came straight out of the textbook but never took any time to validate any of the percentages that you use. Bu Irene made the same mistake on her blog postings by ASSUMING a MARR of only 10% when that is a really BAD number to be using.

]]>As AACE is the only professional organization left that still includes both ADM and PDM problems in their exams be 100% certain you are clear in how to convert from one to the other. Interesting to note that when doing forward pass/backwards pass problems, it is actually easier to do the calculations using ADM, however as the last “real” project that I used ADM on was the Negev Airbase project back in 1980-1982. Since then PDM has become the dominant method for exactly the reason you explained above.

Keep up the good work….

BR,

Dr. PDG, Jakarta

What you may want to consider doing is taking this topic more deeply by exploring the different types (subsets) of INCENTIVE contracting options:

Cost Plus Incentive

Fixed Price Incentive

A + B or Time + Cost Method

Lane Rental Approach

Incentive/Disincentive

AND/OR some of the ALTERNATIVE NON-ADVERSARIAL contracting options:

Partnering

Joint Ventures

Integrated Project Delivery (IPD)

Production (profit) Sharing

BR,

Dr. PDG, Jakarta

BR,

Dr, PDG, Jakarta

As the program draws to a close, what you may want to think about doing is creating what you believe to be a “model dashboard” for your projects? Something along the line of what Steve did for oil and gas projects? http://pmworldjournal.net/article/best-class-dashboards-oil-gas-projects/

Keep up the good work and you are doing just fine……

BR,

Dr. PDG, Jakarta

As this is an OFFSHORE project, if you have the motivation you may want to do another blog posting using Norsok Z-014 to see if their 3D approach (Component, Resources and Activities) works out better than using the Omniclass Tables?

Again, great job on a very interesting case study.

BR,

Dr. PDG, Jakarta

I am going to REJECT this blog posting and make it subject to you FIRST calculating what is an appropriate MARR. http://pmworldjournal.net/article/using-analytical-hierarchy-process-determine-appropriate-minimum-attractive-rate-return-oil-gas-projects-indonesia/

Why is this so important? Because if you use the wrong MARR then all your other calculations will be USELESS. (Garbage in/Garbage out)

Once you have a realistic MARR then you can redo all these calculations and get the 5 stars they should have earned.

BR,

Dr. PDG, Jakarta

I am going to REJECT this blog posting and make it subject to you FIRST calculating what is an appropriate MARR. http://pmworldjournal.net/article/using-analytical-hierarchy-process-determine-appropriate-minimum-attractive-rate-return-oil-gas-projects-indonesia/

Why is this so important? Because if you use the wrong MARR then all your other calculations will be USELESS. (Garbage in/Garbage out)

Once you have a realistic MARR then you can redo all these calculations and get the 5 stars they should have earned.

BR,

Dr. PDG, Jakarta

I am going to REJECT this blog posting and make it subject to you FIRST calculating what is an appropriate MARR. http://pmworldjournal.net/article/using-analytical-hierarchy-process-determine-appropriate-minimum-attractive-rate-return-oil-gas-projects-indonesia/

Why is this so important? Because if you use the wrong MARR then all your other calculations will be USELESS. (Garbage in/Garbage out)

Once you have a realistic MARR then you can redo all these calculations and get the 5 stars they should have earned.

BR,

Dr. PDG, Jakarta