As Published In February 2007

Project Management

Harbor Masters
By Monica Mehta

With Oracle, KCI Technologies prepared Annapolis for Volvo Ocean Race.

On any given day, Annapolis Harbor is filled with boats of many sizes, their sails fluttering in the winds of the Chesapeake Bay. For the seafaring crowd, the harbor is one of the premier sailing centers in the country; for locals, it is a source of pride and pleasure—as well as revenue.

However, due to its shallowness in certain areas, the harbor is not suitable for larger craft. If it were deeper, it could be a stopover for boats such as luxury yachts, which tend to spend more money, and could thus generate more revenue for Annapolis.

City officials had been talking about deepening the harbor for awhile, but the 2006 Volvo Ocean Race spurred them into action. Annapolis has been one of the stopovers of the race, held every four years since 1973, for the past three races. When the race again picked the Maryland city as one of its stopovers for 2006, officials were delighted. In 2002, the event generated US$52 million in revenue from tourists who came to see the grand 60-foot yachts that docked in Annapolis Harbor.

The city would, however, have to address the fact that the new high-tech carbon-fiber boats were 10 feet longer, and consequently had larger keels with drafts of 14.8 feet. The harbor channel was only 13 feet deep in some areas. If the new yachts tried to enter the channel, they would risk running aground.

Removing the shallow areas of seafloor would allow the boats to pass through easily. But a dredging project of this size—requiring the displacement of roughly 24 million pounds of seafloor—is a huge undertaking. Environmental impact is a major consideration, as is the question of what to do with the 12,000 tons of earth pulled out of the ocean. In addition, any dredging project of this size would face regulatory requirements that necessitate a host of permits, water quality tests, proper handling and disposal of potential hazardous materials, and projections about the long-term effects on the Chesapeake Bay. Add to these issues the fact that this project would have to be completed in eight months, and it became clear that the city was proposing to sail into stormy waters. But a combination of engineering ingenuity, project management aptitude, and powerful Oracle software helped Annapolis chart a course for success.

Anchors Aweigh

In 2003, city officials hired Maryland's largest employee-owned engineering firm—KCI Technologies—to perform a feasibility study on the harbor. After consulting with Annapolis Harbor Master Ric Dahlgren and the designers of the new 70-foot-long boats, as well as Volvo Race officials, KCI's Environmental Engineering division developed a plan that involved dredging along a 50-foot-wide, 3,500-foot-long channel. KCI's capacity to manage every aspect of the project won the contract for the firm.

With so many resources and tasks required to make the dredge a success, KCI relied on Oracle technology to help manage the multiple stakeholders involved, keep track of resources, organize schedules and budgets, and complete the project on time. But having a plan and IT infrastructure in place was only the beginning of a long journey.

During the preliminary design phase, KCI determined that the best location for the dredged material was Greenbury Point, an area owned by the U.S. Naval Academy. Greenbury Point offered opportunities to create wetlands using the dredged material. The wetlands help filter sediment runoff from the mainland, which is especially problematic in the Chesapeake Bay region. "A key goal of this project from the early-stage design was to provide an environmentally beneficial use for the material," says Chris Overcash, professional engineer and KCI project manager.

With the disposal problem solved, KCI faced another issue common to large-scale projects: too little time. The permitting process for such a project usually takes months, so Overcash began to draft permit applications for the Maryland Department of Environment early—in November 2004. But because the final decisions regarding the project were not determined until August 2005, final design could not start until then. With a project completion deadline of April 2006, this left only a few months to draw up plans, select a contractor, and complete the work.

Due to environmental restrictions, the project team had to look for a construction company, get it under contract, and get the crew working within two weeks. Dredging in certain areas had to be completed before mid-December, because of regulations pertaining to the local oysters. Starting in mid-November, the construction company took two months to complete all the dredging work.

The next challenge concerned the large number of stakeholders involved in the project. After choosing several potential scenarios for advancing the project, KCI as team leader, along with Annapolis and the U.S. Army Corps of Engineers, assembled potential stakeholders, including the Maryland Port Administration, U.S. Naval Academy, U.S. Fish and Wildlife Service, Maryland Environmental Service, and Anne Arundel County Soil Conservation Service, to ascertain the potential benefits to the region from the project.

"It was very challenging to interact with the whole team of stakeholders and come up with a strategy in which every team member sensed that they were gaining something," says Overcash. To manage the multiple stakeholders, funding vehicles, and subconsultants involved in the process, KCI used Oracle E-Business Suite and Oracle Projects, integrated with Deltek's CRM & Proposals solution. It used Oracle Project Costing as a cost management solution for all its projects, because of its ability to access real-time expenditures, progress, and projections across organizational boundaries. The company also used Oracle Project Billing to simplify client invoicing, improve cash flow, and measure the profitability of contract projects. KCI's administrative staff would input employee hours and subcontractor bills into the system on a weekly basis—giving the project manager tight controls of all efforts.

"Oracle allowed us to keep track of the resources we had left within the different portions of the contract budget," says Overcash. "I could look through and see how much have we expended, how much is left, do we need to try to secure more funding for completing the design work, or is it going to be effective with what we have now."

KCI used Microsoft Project on the desktop for project development—scope, schedule, and budget. Using Oracle Project Connect, data involving project structure, budget, and status was passed into a centralized management system built on Oracle Projects. The company could then return accurate data from across the entire project directly to managers' desktops. KCI CIO Alan Mlinarchik says Oracle Projects made it easy to manage a complex, multivendor environment: "The conduits that Oracle provides—[Oracle] Project Connect, [Oracle] ADI [Applications Desktop Integrator], etc.—facilitate the rapid integration of systems from multiple vendors, allowing organizations to build integrated vertical solutions without risk of major future incompatibilities or maintenance requirements."

Mlinarchik says Oracle also helped greatly with the organizational aspects of the project: "Oracle E-Business Suite, integrated with third-party project scheduling and CRM [customer relationship management] solutions, allowed us to manage the requirements, scope, schedule, budget, and invoicing of a project with multiple clients, funding sources, and funding schedules. All of these efforts were linked and tracked as a single project. With the intelligence on clients and agencies of interest from our CRM system, coupled with the ability to manage the effort as a single project, we were able to easily coordinate a wide range of disparate activities to a successful outcome for all parties concerned."

For More Information Oracle Project Management Oracle Applications

Oracle Projects helped streamline complex billing processes and dramatically reduced administrative hours, allowing KCI to complete the project on time and on budget. Without its capability to manage a project with multiple clients and funding sources, Mlinarchik says, the amount of time required for project management "could easily have tripled or quadrupled."

"Oracle Projects was the only solution that really understood the architecture of the engineering business, and that could link together all of our various initiatives," Overcash says. "Oracle Project Billing's automated client billing reduced countless man-hours in invoice preparation."

Smooth Sailing Ahead

Harbor Master Dahlgren says the city of Annapolis learned an important lesson. "In any of these types of operations around the water, you need to start the project early and hire someone who has the necessary knowledge and skills and connections to make it go smoothly," he says. "If you don't hire someone who understands the process thoroughly and understands the underlying background of it, and the maritime requirements from A to Z, that will slow the project down and make it much more expensive. I thought KCI did a great job. KCI was available to us and cognizant of all the environmental issues, and got through the permit process without any hang-ups."

Despite the project's complexities, Annapolis' dredging investment has paid off. So far, out of its total budget of US$600,000 for the project, it has spent about US$350,000 on dredging. This year's Volvo Ocean Race stopover is estimated to have made the city US$54 million. There's also long-term good news for the city: It will now be able to attract larger boats to its docks. "[Annapolis] can utilize the city's harbor for larger draft vessels, and the larger the boat, the more financial resources the owner has," says Overcash.

In addition, Dahlgren says this project paves the way for more-ambitious projects to get even larger boats to Annapolis Harbor. "In the business we're in, there's constant demographic change. The market, the users, the types of boat—they all change. In order for us to keep the market segment we have, we need to be responsive to those changes. It's difficult to do that unless we have the capability to add business. Anything that allows us to bring in larger boats and accommodate them is going to increase the economic benefit to the city."

"In the long run," says Overcash, "it's going to be a real benefit to the city of Annapolis."

What's the Big Deal About Dredging? Dredging is highly regulated because of the environmental issues it involves. Brian Ross, a scientist with the U.S. Environmental Protection Agency's Dredging and Sediment Management Team, talked to Profit about the environmental impacts of dredging. PROFIT: What exactly is dredging? ROSS: Dredging is the removal of accumulated sediments in the bottom of a waterway. Sometimes people dredge for flood control issues, but more often it's navigational. There's maintenance dredging, where you're taking sediment that builds up over time and settles into your navigation channel to keep the approved depth for the boats to use. There's also the need to deepen a channel because of bigger ships that need to come in. The kind of bigger ship Annapolis is trying to accommodate is a different class of sailboat—they're not talking about bringing in supertankers there. PROFIT: What are the major environmental concerns? ROSS: The first is whether the mud that's being dredged is contaminated. You might kick it up and contaminate something nearby. There's also a concern about where you're taking it to dispose of it, and if you are going to be creating a problem there. Another concern has to do with the modification of the waterway. To dredge a channel, you might be destroying a lot of high-value shallow water habitat to create a deep channel. You can also literally change the way water circulates. The other major concern is the turbidity and the kicking up of mud where you dredge. Are you going to be scaring the fish away or smothering the eelgrass beds nearby? PROFIT: How are these concerns addressed? ROSS: You can reduce a lot of these concerns if you make sure the dredging that's happening is necessary. But mainly, you make people plan to do something positive with the mud they're generating—to not think about it as a waste. When there are dredging projects and the mud is suitable for recycling in some way like wetland or other types of habitat restoration, we encourage that very strongly. You can also reuse mud for fill that would be gotten from other locations—for example, instead of digging up a hillside to build a levee or a road. PROFIT: How is wetland creation and restoration good for the environment? ROSS: There has to be some independent knowledge that a wetland is being built in a place where it's needed and able to be sustainable. But this country has lost 80 or 90 percent of its wetlands, and coastal wetlands are almost incalculably valuable—not just aesthetically or ecologically, but in terms of monetary value too. They are the cradles for so much seafood and bird life that we rely on.