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Preparing for new project inbound material logistics operation

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Internal Preparations for outsourcing 3.5PL or in-sourcing 4PL

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Preparing for new project inbound material logistics operation

  1. 1. Preparing for New Project Inbound Material Logistics Operation Management Service Models Ready, Set, Go! © Project Logistics Management, Inc./Wei Li
  2. 2. Defining Vision/Anticipations for Inbound Material Logistics Management Contributions to Project SCM • Project Total Ownership Cost Control & Project Material Logistics Operation Management Contributions • Development/redevelopment/turnaround and expansion onshore projects & operation revenue loss preventions/minimizations • Direct & indirect project material logistics service and project material logistics operation management cost control
  3. 3. Consensus On the Project Material Logistics Management Objectives • Project management, project procurement management, project construction site management, project engineering management are all to support and to benefit from the next level project material logistics management model in daily practice • Logistics service category management is to support and benefit to add more significant and tangible values subjectively measurable • Project gate pass review boards must specify their expectations and set new criteria in alignment with the defined vision
  4. 4. Reviews of Current EPC Contract Award Related Project SCM/Material Logistics Management Practice • Onshore project delays and logistics operation mismanagement attributions in historical data analysis • Identifying the flaws from outstanding project SCM practices, including ECP1PL competence & capacity screening procedures, if any; AVL mandatory requirements on project subcontracts with 2PLs and 3PLs, if any; check & balance mechanism on results of project material logistics operation management oversight planning & implementations • Identifying pragmatic alteration to current EPC contract award practice, at least the Ts & Cs related to project material logistics operation management
  5. 5. Best Practice for Project SCM at Owners/Operators • New project SCM practice: project material logistics operation management oversight planning and implementation requirements, project material logistics operation excellence implementation program requirements, mandatory AVLs on project subcontracts for 2PLs & 3PLs and Scorecard Admin procedures & protocols • Project management, construction site management and project procurement management supports for Project Material Logistics Operation Management • Logistics service category management for project material logistics operation management • Establish best practice based project material logistics operation management with SOPs and protocols, in replacement of current project short term SME contracts with in-sourced 4PL in “carving out” EPC contract model, or out-sourced 3.5PL in status quo EPC contract award model
  6. 6. Project Material Logistics Operation Excellence & Metric Setting • To make inbound material logistics management counts for project total ownership cost control, subjective measurement system is to be set in place, specifically gauging the delivery delay cut downs, hence the reductions in operation revenue losses and project material logistics costs. • Where and how which nodes of process flows should be monitored at what scale and frequency, so that project material logistics operation processes can be steered, measured and completed on the marks. It is analytical, while it does call for well rounded material logistics service operation expertise for operationally practical considerations in metric settings. • Project material logistics operation excellence initiative program & implementations for internal staffs/contractors and EPCs alike
  7. 7. Project Logistics Operation Management Service Introduction & Implementation Planning • Change Management Initiative Program • Project total ownership cost control & inbound material logistics management contribution initiative program, project management gate pass criteria • Project SCM best practice initiative program • Project material logistics operation excellence metric implementation initiative program • Project material logistics management service performance benchmarks • Project material logistics & SCM procedure integration and communication protocol orientation program
  8. 8. Organization Structure, Process Map, SOPs and Protocols to Pave the Inroads • Logistics service category management, 3.5PL or 4PL work scopes, procedures and protocols • Project management team and 3.5PL or 4PL project placement procedures and protocols • Project construction site management and 3.5PL or 4PL under project placement work scope, procedures and protocols • Project procurement and 3.5PL or 4PL project placement work scope, procedures & protocols • Awarded EPC1PL and 3.5PL or 4PL under project placement work scope, procedures and protocols • Other relevant work scopes, procedures and protocols
  9. 9. Road Map for Project SCM Best Practice Development and Implementations • Optional models between without external enhancement resources, the best practice development and implementations for in-house project material logistics management functionalities • 3.5PL model introduction and implementation procedure with requirements both for project procurement at owners/operators and for awarded EPC1PLs • 4PL model introduction and implementation procedures with all internal interfaces stipulated in clear procedures and protocols • Objectives, measuring metrics and benchmarks set for all three above models

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