Posts Tagged ‘Construction contracts’

Hidden Contracts You Didn’t Know About

February 15th, 2009 No comments

We were in the process of buying the electrical equipment for a new plant when the electrical engineer came in with the bad news. They had been told by the electric utility the project would have to buy the transformer from the utility company. We could understand hooking up the transformer, but to actually have to buy the transformer was crazy, which we told him in no
uncertain terms! The transformer we needed cost $750,000 from our referred supplier, while the utility wanted $1,250,000 for basically the same thing. They put a few bells and whistles on it but the cheaper version would work just as well. Was there any way around this? Apparently not. It was the law in this jurisdiction. So just like that, POW, we were, $500,000 behind in the budget. Unfortunately this senario is all too familiar and is just one example of what I call hidden contracts. These are contracts your company has with out side suppliers / agencies / government bodies that you are not usually aware of until the bill comes in.
Utilities are just one of those hidden contracts.

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December 10th, 2008 No comments

To provide engineers and non-technical people with relevant, practical information, news, and tools to help them manage their projects efficiently and effectively. To help develop their project knowledge base with a basic understanding of the main facets of project engineering in North America.

Who is this site for?

It is for anyone involved in managing projects and wants to have better control of those projects (anyone who wants to be the master of their own destiny), those experienced at project management or just starting out in project engineering. Industry or consulting. Technical or nontechnical.

Are you an engineer or technician who has no special training, yet is given the task of overseeing a project. Nowhere to go for good practical project advice and help that you now need? No Coach? No Mentor? Then you have found the right place.

Vendor Data Requirements (cont’d)

November 15th, 2008 No comments

In October I started a discussion on Vendor Data Requirements and their
importance to your project. This is the vendor data that you require with their proposal and later in the project should they be the successful bidder. In review, this document is used when purchasing equipment and outlines to the vendor exactly what information you expect him to include with his quote. In this article I will cover additional information you should be asking for and why you need the information. Following are some  additional data items typically required from a vendor ;
6. Transport
As you have to unload project equipment you need to know how the equipment will be delivered to your site and the number of pieces. If it is coming by normal non-restricted transportation methods you can organize the proper equipment and set a time for the unloading. If the equipment is too large and has to be transported by restricted methods you want to know how it is being shipped as you will have to handle it.

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Vendor Data Requirements

October 15th, 2008 Comments off

Last month we talked about the Standard Component List and it’s importance to your project in helping make sure you get what you want and what you need. Another important document, that goes along with the Standard Component List, is the Vendor Data Requirements. This document is typically used when This document comes in a couple of formats, one as a printed document describing in detail what information you are looking for and the other as an itemized list.

Either one works as long as you outline to the vendor what information you require. The printed document is a standard one and covers every possible piece of equipement. The itemized lists can be tailored to suit what you are purchasing. As an
example, you can develop a list for rotating equipment and one for pressure vessels and use them accordingly.

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Get What You Specify, Not What you Want

September 15th, 2008 Comments off

As a consulting engineer we recently did a project where the specification
called out asbestos gaskets. Knowing that asbestos has not been used for
years in North America and the fact that the project engineer on the last
project did not want to use them, we assumed that this project engineer
would do the same. We spent some time researching what was used in the past, made up a specification deviation and sent it to the owner. To our surprise he refused the specification deviation as he liked asbestos gaskets and that was what he wanted to use.

This is not an isolated incident and is a problem that all people dealing with
owners have, is what does the owner want? As a service provider, time and
money are wasted when there is confusion and indecision on the owners’
side. People do not know what to do, so nothing gets done. You don’t know
which direction to go, so you spin your wheels. This is not a pleasant position to be in, especially when you figure out one engineers preferences and the next one has different preferences.

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