A stage gate approach (also known as a phase-gate or waterfall approach) is a common project management technique in which a project is divided into phases or stages that are separated by decision making points known as gates). At each “gate” the decision is made as to whether to stop, move forward with the existing scope, schedule, and budget, or further refine.
This approach is commonly used for many types of projects, and is especially well-suited to bioeconomy related projects, especially those involving newer technologies with very tight budgets. Consulting groups use this method often in larger projects as it helps clients assess where they are and whether proceeding as scheduled is the right move.
When used during the engineering and construction development portions of project implementation It is important early on, to determine correct milestones for decision making of development, construction, and business projects/expansions.
Below is an example of a generalized stage-gate approach for a project:
Phase 1 – 1% engineering with a +/-50% estimate of TIC (Total Installed Cost)
Phase 2 – 10% engineering with a +/-30% estimate
Phase 3 – 25-50 % engineering with a +/-10% estimate (for budget authorization)
Phase 4 – 100% engineering to provide (for Construction documents for final construction services bidding).
Phase 1 is to understand the business case and scope of the project in fairly general terms to get a basic understanding of project costs early and to make a decision to move to Phase 2 or not without spending an inappropriate amount of dollars on engineering. Each following stage gate is similar, to be able to get the best understanding and alignment of scope, schedule, and budget between all stakeholders and then making appropriate decisions to move forward or not to the next phase.
Pre-development and Phase 1 may include:
- Understanding how much equity/cash on hand the company can contribute to the project is a gate that helps determine how much potential lending can be obtained.
- The equity/debt/cash determination establishes total financing for the project which leads to a decision on a potential design-build and what the size and scale of the building/structure/project will be.
- Based on the size of the facility, determine what vertical integration components can be incorporated into the building and at what size.
Large renewable energy and biochemical consulting firms certainly have experts in biofuels and renewable biofuels like bio ethanol, biodiesel, and renewable diesel, and the more common areas like biomaterials, biomass, biomass power, feedstocks, and biotechnology. In these larger consulting groups, one will also find energy consultants in some specialty areas like other biofuels like algae biofuels, aviation/biojet fuels, ethanol, cellulosic ethanol, advanced biofuels, biodiesel, renewable diesel, renewable natural gas, renewable and biochemicals, biogas, syngas, biochar, bio coals, biobutanol, pyrolysis oil, producer gas, and wood pellets. They will also have experts in hemp and cannabis as these industries continue to grow.
Lee Enterprises Consulting is the world’s premier bioeconomy consulting group, with over 150 highly qualified experts serving in all these areas. Look at our experts and the services we provide. Most of our experts are also available to advise and serve as expert witnesses in bioeconomy litigation matters. For the larger projects, we specialize in putting together full service, interdisciplinary teams with one point of contact. See video about LEC here. Call us at 1+ (501) 833-8511 or email us for more information. See also: Project Feasibility Studies in the Bioeconomy.
