Internal Quality Audits at HDR The Evolution of a Quality Management System

1. American Society for Quality The 33rd National Energy & Environmental Conference Tucson, Arizona August 27-30, 2006 Session T21: Achieving Quality in Auditing – Executing Projects in Global and US-only Environments Internal Quality Audits at HDR The Evolution of a Quality Management System Dan Domalik, P.E., CQA East Region Lead Auditor HDR Engineering, Inc.

2. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction Purpose of Presentation My Background • Introduce HDR • Our Quality Program • Quality Auditing at HDR HDR Quality Office QA/QC Program Audit Program Summary Who am I? and Why am I here? How does a consulting engineering firm ensure design quality? QA/QC

3. Introduction Introduction Purpose of Presentation My Background • Structural Engineer – 10 years • BS Civil Engineering Technology • MS Civil Engineering • Professional Engineer (PE) HDR Quality Office QA/QC Program Audit Program Summary HDR Quality Office QA/QC Program Audit Program Summary • Lead Auditor – 1 ½ years • MBA? CQA? OJT! QA/QC QA/QC

4. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction HDR Transportation Services Statistics Projects Awards Growth Quality Office QA/QC Program Audit Program Summary Planning Environmental Architecture HDR is an architectural, engineering and consulting firm that excels at managing complex projects and solving challenges for clients. www.hdrinc.com Construction Water/Wastewater Program Management Consulting Security Power & Energy QA/QC

5. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR • Founded in 1917 • More than 5,200 employee owners • Over 130 locations worldwide • $730 million in fees (2005) • Headquarters: Omaha, Nebraska Services Statistics Projects Awards Growth Quality Office QA/QC Program Audit Program Summary QA/QC

6. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Cooper River Bridge Birck Nanotechnology Center Services Statistics Projects Awards Growth Quality Office QA/QC Program Audit Program Summary Ventana Medical Systems Corporate Headquarters City of Las Vegas Water Pollution Control Facility Expansion QA/QC Hoover Dam Bypass

7. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Engineering News-Record Rankings # 17 - Design Firm # 2 - Health Care # 2 - Solid Waste # 5 - Dams & Reservoirs # 7 - Correctional Facilities # 7 - Highways # 8 - Bridges # 9 - Treatment & Desalination # 10 - Sewerage & Solid Waste # 10 - Transportation # 10 - Water Supply # 11 - Mass Transit & Rail # 13 - Wastewater Treatment # 15 - General Building # 16 - Fossil Fuel # 18 - Transmission Lines & Aqueducts Services Statistics Projects Awards Growth Quality Office QA/QC Program Audit Program Summary QA/QC

8. Introduction HDR Introduction HDR Services Statistics Projects Awards Growth Quality Office QA/QC Program Audit Program Summary Quality Office QA/QC Program Audit Program Summary growing How does a consulting engineering firm ensure design quality? continuously improve QA/QC QA/QC

9. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction HDR Quality Office Technical tools QUALITY OFFICE Standards & Specifications 2008 Strategic Plan QMS/ESS QA/QC Program Audit Program Summary Client Satisfaction The HDR Quality Office: Leading Management’s Commitment to Quality Reviews QA/QC Program Project Management Training Technical processes QA/QC

10. Introduction HDR Quality Office Introduction HDR Quality Office • Quality Management Services (QMS) • QA/QC Procedures • Internal Audit Program • Best Practices • Peer Reviews • Client Report Cards 2008 Strategic Plan QMS/ESS QA/QC Program Audit Program Summary QA/QC Program Audit Program Summary • Engineering Support Services (ESS) • Internet/Intranet • Document control tools • Software support • Standardization • Project Management Tools/Training • Construction Administration QA/QC QA/QC

11. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction HDR Quality Office QA/QC Program “Work Well Done.” • 1980’s – Created QA/QC Program • Gradually ignored History Components Procedures Training Audit Program Summary Documenting our approach to delivering Quality • 1998 – Reestablished QA/QC Program • Updated 2002-2006 • 2005 – Established Quality Office and Audit Program • Regional Quality Directors QA/QC

12. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program • Program Documents • Quality Assurance Procedures • Quality Control Procedures • Technical Procedures • Steering Committee • Regional Leaders • Technical Leaders • Marketing • Construction • Ad Hoc • Program Implementation Responsibilities • Defines roles and responsibilities • From the President to all employees • Internal Audits • Evaluate compliance with QA/QC Program • Identify opportunities for improvement • Share best practices History Components Procedures Training Audit Program Summary QA/QC

13. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program • Policy & Definitions • Establishes basis for authority • Creates a common language • Project Guides • Project Management tool • Project Communications • Originating and maintaining correspondence • Project Filing • Paper and electronic files • Project Reviews • Inform management, mitigate risks • Drafting Standards • Standardize computer drawing production • Quality Control Reviews • Senior independent reviewers • Verify quality of deliverables History Components Procedures Training Audit Program Summary QA/QC

14. Introduction HDR Quality Office QA/QC Program Introduction HDR Quality Office QA/QC Program History Components Procedures Training Audit Program Summary Audit Program Summary QA/QC QA/QC

15. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program Audit Program white paper 2004 Quality Office and Audit Program launched Lead Auditors selected Summary History Roles Process Results Issues Draft audit processes developed 5 pilot audits conducted The missing piece of the puzzle… Accountability Audit processes finalized 2005 Formal Audit Program rollout Year-end reports developed First repeat audits conducted 2006 QA/QC

16. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program • Quality Office Director • Reports to President • Develops, coordinates, monitors • QA/QC Program Director • Establish, implement, maintain • Promote awareness • Audit Administrator • Overall logistical support to Audit Program • Lead Auditors (East, Central, West) • Coordinates and leads quality audits • Auditors • Part-time – 1 or 2 audits per year • Regional Quality Directors • Audit follow-up, root cause analysis • Development of action plan • Office QA/QC Program Coordinators • On-site logistical support for audits NATIONAL History Roles Process Results Issues Summary REGIONAL LOCAL QA/QC

17. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program History Roles Process Results Issues Summary QA/QC

18. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program History Roles Process Results Issues Summary We review individual projects We report on a business group and office level QA/QC

19. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program Observations → Findings → Areas for Improvement Facts → Conclusions → Issues to Work On History Roles Process Results Issues Summary QA/QC

20. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program Post-audit Action Item List (PAIL) History Roles Process Results Issues Summary QA/QC

21. Introduction HDR Quality Office QA/QC Program Regional/Local Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program • June 2005 – June 2006 • 26 audits conducted • 327 projects ($150 million in fees) • 26 auditors participated • Well-documented audit processes • 4 procedure training modules History Roles Process Results Issues Summary • Outcomes • Increased awareness & focus • Greater process formalization • Shared best practices • More feedback QA/QC

22. Introduction HDR Quality Office QA/QC Program Audit Program Introduction HDR Quality Office QA/QC Program Audit Program • Challenges Faced by Audit Program • Audit preparation – “gaming” the system • Small offices • Selecting projects for review • Consistency among • Auditors • Audits • Regions • Culture change – acceptance • Auditors “owning the problem” • Standardization vs. entrepreneurship • Keeping audit program “fresh” History Roles Process Results Issues Summary Summary QA/QC QA/QC

23. Introduction HDR Quality Office QA/QC Program Audit Program Summary Introduction HDR Quality Office QA/QC Program Audit Program Summary You improve what you measure • Strengths • Culture of quality – “Work well done” • Quality Control Reviews • Project files • Project management What did we learn? Where are we going? • Areas for Improvement • QA/QC training • 0% Reviews • Management Reviews • QC Plans QA/QC

24. American Society for Quality The 33rd National Energy & Environmental Conference Tucson, Arizona August 27-30, 2006 Session T21: Achieving Quality in Auditing – Executing Projects in Global and US-only Environments Internal Quality Audits at HDR The Evolution of a Quality Management System Dan Domalik, P.E., CQA East Region Lead Auditor HDR Engineering, Inc.