According to Allan To, director of engineering for construction and offshore at Suncor Energy, successful advanced work packaging (AWP) implementation requires an integrated organizational shift in how projects are developed and constructed.
Brian Vogel, left, project engineering manager for The Dow Chemical Company, joined Allan To, director of engineering for construction and offshore at Suncor Energy, on a panel at the AWP Conference held recently in Houston.
“Surely, procurement is one of the key functions that must be kept in lockstep with an organization’s implementation of AWP,” To said.
Procurement is generally accountable for the productive and efficient sourcing of goods and services, making sure “the right parts and services are there at the right time, at the right price and the right quality,” To continued at the AWP Conference held recently in Houston. “It’s only logical that procurement be brought on board very, very early in this process to influence, drive and support AWP and its objectives.”
The traditional transactional approach to procurement, To observed, does not support and is not consistent with AWP.
“Many of the traditional procurement approaches and orthodoxies that we have within the procurement function just do not serve AWP,” he said.
When Suncor considered the existing strategy around engineering and construction, there was “a very transactional” approach, To said. “If we are to become industry leaders in project execution, we ought to look at engineering and construction in a different way. We have to influence the supply market to allow us to realize the value that’s there. We know that there’s value there, and we know there’s significant waste there.”
To further observed procurement often plays a significant role in contractor management and contract strategy governance.
“Contractor performance management, as a process within procurement, needs to be adjusted to reflect that level of collaboration to drive integration across engineering and construction,” he said. “One of the key tenets that we hear often is ‘Activities are planned to support the path of construction.’ Similarly, owner-procured goods and services must also support the path of construction.”
Separate scorecards
Brian Vogel, project engineering manager for The Dow Chemical Company, observed that “engineering and procurement do not have the same scorecards.”
Historically, procurement is scored on how much money an organization is saving, Vogel said, or how much money they are “claiming to be saving the company.”
“It’s easy to measure purchase dollars, but it’s very difficult to measure negative impact on construction,” Vogel said. “That’s one of the struggles that [Dow] has been through. We’ve tried to fight this battle for years. I think some in this procurement world are starting to come around to understand what we’ve been saying all these years. We try to rely on the overall purpose of doing the procurement and getting what we need to the site when we need it.”
Vogel admitted it is difficult to change ingrained procurement work processes, challenging the industry to start thinking about how contracting strategies need to change in an AWP environment.
“We’ve had some very well-established work processes in place for [30 or more years], mostly unchanged, with little adjustments here and there,” Vogel said. “People are entrenched in these work processes; the work process says they have to do x, y and z.”
Vogel said it is incumbent upon owners and managers that workers understand the extent of their own flexibility and how to properly apply what their work process discipline states in terms of “what they really need to do.”
“Marrying the two together, between engineering and procurement, is a challenge, but it can be done,” Vogel said. “We’ve demonstrated that on some projects.”
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