Process Optimization of Engineering Work Request in an Offshore Environment

Abstract

The survival of multinational corporations today and in the future is premised on their competitive edge in effectively deploying modern optimization tools in providing utility and services to clients. This research studies the applications of process optimization in the valve procurement life cycle of the engineering unit of an offshore corporation. A forensic audit into the operations of this multi-disciplinary corporation with varied processes targeted at achieving optimization goals reveals cases of inefficiencies in personnel utilization and cost management. These show up in duplication of personnel effort and inefficient cost burdens. Employing the excellent tools within the lean six sigma framework, analysis of the manufacturers and cost combinations were carried out on 9,145 valves procured between January 2017 and January 2020. The results indicate huge cost variations of over 50% of valve mean price of similar valve types and sizes with resulting loss of cost-saving opportunities for the period under consideration. Process inefficiencies were established, such as unnecessary duplication of the process step of contacting the valve original manufacturer for a quote, inadequate rigour in price negotiation, and unnecessary features requested during valve specification. The outcome of this study corrects these inefficiencies, improves opportunities, and makes recommendations such as the need for all manufacturer engagements to be multi-party that involves the end-user, supply chain group, and approvers to eliminate rework and checkmate opportunities for racketeering. These establish cost-effectiveness and resource efficiency in the system.