Does the Dutch process industry fully realize the potential of this instrument? Marcel Verschuur

Transcription

1 Value Engineering Does the Dutch process industry fully realize the potential of this instrument? Marcel Verschuur November 30, 2005

2 Agenda u Fluor Introduction u Value Engineering and its Objectives u Methodology u Results and Benefits u Conclusions HA

3 Fluor Corporation One of world s largest engineering, procurement, construction and maintenance companies u u u u u Founded more than 100 years ago One of the world s safest contractors An international work force of more than 35,000 employees Serving customers through a network of offices in 27 countries and six continents Year 2004 revenues: $ 9.4 billion HA

4 Global Business Segments Global Services Equipment Operations & Maintenance Staffing Industrial & Infrastructure Government Energy & Chemicals Chemicals Petrochemicals Gas Processing & LNG Gas to Liquids (GTL) IGCC Heavy Oil Upgrading & Oil Sands Pipelines Refining Oil & Gas Production Power Generation HA

5 Fluor Range of Services HA

6 Value Engineering u Widely used technique to improve project performance u Structured method to increase value through improved functionality or reduced capital expenditure and/or life cycle costs u Achieved by eliminating or modifying items that do not add value or meet business needs HA

7 What is Value? Value = Function Cost Cost to reliably perform a function Total value includes e.g. performance, salability, quality All from the owner s point-of-view HA

8 Typical Value Engineering ideas u Challenging outdated company standards u Removing unnecessarily tight specifications u Verifying and confirming (early) assumptions u Challenging previous ways of doing things u Aligning project scope and objectives u Saving material u Improving processes u Shortening times required to perform tasks u Introducing new technology HA

9 Methodology of Value Engineering VE-PHASES 1. INFORMATION OUTSIDE WORKSHOP PREPARATION INSIDE WORKSHOP INTRODUCTION TO VALUE ENGINEERING 2. FUNCTIONAL ANALYSIS COST DISTRIBUTION FUNCTIONAL ANALYSIS 3. CREATIVE SESSION BRAINSTORMING 4. EVALUATION EVALUATION & SELECTION 5. DEVELOPMENT DEVELOPMENT OF PROPOSALS PRELIMINARY PRELIMINARY RECOMMEND RECOMMENDATION 6. IMPLEMENTATION IMPLEMENTATION BY PROJECT TEAM PRESENTATION & FINAL REPORT HA

10 Functional Analysis heart of the process Purpose: u Good basis for brainstorming u Forces the team to think in functions, rather than solutions u Will help to get to the heart of the problem u Requires justification of design Needs Wants HA

11 Achievements on past projects Relative Savings as a Result of Value Engineering (millions Euro) Project TIC Savings as % of TIC Savings on 10- year life cycle Oil refinery expansion Chemical facility Gas processing facility Not quantified Fertilizer plant revamp Food processing facility Not available TIC: Total Installed Cost HA

12 NAP 2x2 Project report u Characterization of best and worse projects (schedule and cost performance) In the best group, more than half used value engineering or process simplification Not one of the worst projects used value engineering Source: 2x2 Your choice for projects, twice as cost effective, twice as fast NAP Dace 2002 HA

13 Other Applications u Supporting technology selection u Validation of business case u Facilitating client s go / no go decisions on capital projects u Peer review of a conceptual project design HA

14 Additional Benefits of VE < Better understanding of project objectives < Further alignment of business objectives within owner s organization < Technical alignment between contractor and owner < Better project definition < Improved understanding of risks < Creating group commitment to solutions HA

15 Conclusions Powerful technique Better team performance Increases value Adds to the bottom line HA

16 Final Question for the Audience ŁNow that you realize the potential of this instrument, how will we as the Dutch industry further realize its benefits? HA

17 Thank You for Your Attention Questions HA