The Challenging Question We Often Face.
Recently, I was challenged by a friend, who is not associated with our business, if I could explain why one of our prospective clients why they would hire an outside design/build engineering firm.The client has the capability to produce products in their manufacturing plants, and would thus have a fair amount of in house capability. This is a very provocative question, and one which we are regularly challenged to answer. As I reflected on the varied reasons that support our business, I decided that rather than give my usual elevator speech, I would have a bit of fun with my answer. So, here are what we observe are the top ten reasons (in ascending order) why our clients do routinely ask us to participate, as viewed from their perspective:
10. Experience in executing capital projects is a gap for a manufacturer who needs to make a capital investment. In this case, the client acknowledges that his team hasn’t done enough capital work to be experienced in avoiding potential pitfalls, complications, and interruptions. This customer recognizes that an expert contractor with experience in the required project execution disciplines (engineering, design, procurement, installation, start up), as well as having lived through the tactics of delivering these project phases, will be able to complete the project more effectively than the owner could himself.
9. Management of safety and regulatory issues. Commercial organizations that are in the business of manufacturing goods are under more and more pressure to guarantee safe workplaces that are free of health hazards. New installed equipment and systems will have safety risks and regulatory mandates that will need to be dealt with; it is therefore incumbent that the owner hire a project partner who is able to complete the project securely while meeting all requisite codes and regulations.
8. Project cost and schedule optimization resulting from efficiency. Companies charged with manufacturing products recognize that an expert contractor whose expertise is project management, project engineering, and installation services will be able to complete the project more efficiently, using less time and thus saving money, than could be done by attempting to execute the project with in-house staff. The owner realizes that his team is focused on optimizing his production process and maintaining its associated equipment base, not on performing capital project work.
7. Limited capacity of the owner’s team, or a lack of sufficient internal resources to get the capital project work done in a timely fashion. This is a business situation Optimation experiences with numerous clients. It is fairly typical to discover a customer business model where staffing levels have been set to operate and manage the business, but few discretionary roles are underwritten for “once in a while” or part time endeavors, like capital projects.
6. Design/build company as a turnkey supplier. When manufacturing companies consider the contractual negotiations, conditions, and obligations required to hire, administer, validate and pay for work to be done by other multiple contractors, they recognize and sometimes prefer the benefit of dealing with one overarching partner who has the capability to take full project responsibility. This approach reduces project risk, and the need to mitigate problem responsibility, as ownership of project requirements fall directly to the prime contractor.
5. Project management and administration is a valued component of the project execution. Manufacturing organizations typically keep limited project management resources on staff, and those that are employed may not have the background in overseeing complex capital projects with many inter-related activities and tasks. A third-party firm which employs experts in managing cost and schedule issues, tracking materials and progress, etc. is recognized as a valued and welcomed asset in achieving the company’s goals as related to the capital project.
4. Internal staff lacks all of the necessary skill sets to engineer, design, procure, install and start up a significant capital project. Our manufacturing partner company’s core strength is usually their knowledge and ability to build their “products”, not design and procure capital equipment.
3. Understanding and applying the latest technologies that could apply to a company’s specific business challenge; the owner’s in-house engineering team has their hands full with being expert in their process and thus isn’t up to date on the latest advances in equipment. These cutting-edge technologies could be a significant or strategic portion of the ultimate installed solution. In some cases, the technology gap includes a lack of engineering knowledge to properly specify and deliver needed systems, machinery, and/or controls.
2. Creative thinking and problem solving is a need for vetting potential solutions. The solution to a customer’s problem or challenge is not obvious, and the value add that an outside set of eyes can contribute involves brainstorming new methods, analyzing applicable technologies, weighing options, and providing integrated system solutions that can be studied for performance benefits prior to significant capital spending.
1. Collaborative relationship with a trusted project provider is a beneficial dimension to how a company decides to pursue a capital investment. Clients desire to collaborate with a supplier who treats them fairly, who helps manage risk, is easy to work with, and fills in the gaps that a client recognizes they have in their own ability to deliver capital improvements.
Want to include us on your next project? Get in touch with us today to chat about how we can help you, from concept to completion.