Here’s a well-known secret. An EPC’s biggest bug bear is the procurement process, not engineering, nor construction but procurement. Managing receipts, meeting scheduled timelines, creating material requisitions and data sheets, identifying appropriate vendors that have to be vetted by the end client and myriad consultants, takes time and a toll on productivity. In days long past, lean procurement processes were not a priority for these multi-years, multimillion-dollar projects. Long gestation periods were an acceptable risk in this industry. Not anymore. Competitive pressures, fight for resources, move towards fixed price deals, globalization and remote operations have made margin pressures acute for EPC operators.
September 17, 2020, 08:11