Win-Win Producer-Contractor

By Brian Rinehart | February 01, 2006
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Back in September, Ethanol Producer Magazine published an article titled, "Making Maintenance Matter." This feature described the difference between reactive (emergency) and predictive (scheduled) maintenance cleaning for ethanol plants. In this context, it highlighted the importance of good record keeping for creating regular cleaning schedules that help prevent process failures. However, addressing the details involved in planning, implementing and completing a cleaning shutdown is equally necessary to ensure positive results and a good, long-term relationship between the ethanol producer and cleaning contractor.

In its many years of business serving both government and private industry, the Hydro-Klean team has witnessed a wide range of contract service procurement practices. Through it all, we have noticed that the most successful maintenance projects share a common thread: a high level of effective organization and fluid communication between the contracting parties. Good project communication focuses on three general areas: planning, execution and post-project evaluation. Clear communication between an ethanol producer and a cleaning contractor in all three areas virtually guarantees project success.

Planning
The planning stage should involve several key components:

1. On-site visits: An on-site visit is critical to successful planning, and the cleaning contractor should make on-site visits prior to service procurement. This is imperative if the service provider is new to the plant or if the ethanol producer requests cleaning tasks not previously performed by that contractor. Familiarity with a plant's makeup is essential for the service contractor. The contractor needs to discuss issues such as water sources, waste disposal sites and access to vessels to be cleaned with the plant staff.

2. A detailed review of the scope of the requested work: Both parties need to review all the steps involved in accomplishing the project's scope. This may sound elementary, but if omitted, the results are frequently undesirable. Having a detailed, step-by-step plan that both parties understand ensures the expected results and less downtime for the plant. The plant representative should also clarify whether the plant is providing any labor for the project. This often includes removing and replacing access hatches or cleanup. This input lets the contractor plan efficiently.

3. Up front discussion of quality expectations. Each ethanol plant has different expectations for quality, and it is therefore critical for the producer to communicate detailed quality expectations to the contractor. These expectations can range from immaculate cleanup to something less meticulous, in the interest of decreased downtime and expense.

4. Project-specific safety planning: Getting the job done safely is of mutual and vital importance. Safety representatives from both parties should agree on the scope-specific safety elements. A good contractor will share this information with his or her team in a pre-project meeting before mobilizing. Changes in project conditions or scope are reasons to revisit safety planning.

5. Establishing a point of contact for both parties: This is the first step in creating rapport and relationship building, and ensures successful communications throughout the project. A designated point of contact improves the interactions between the contractor and the ethanol producer. To avoid communication misfires, each point of contact should be a decision-maker.

6. Timelines: An agreed project timeline is valuable for both parties when planning a shutdown. The plant can plan its downtime, and the contractor can provide an accurate cost estimate, as well as honor other commitments.

7. Clarifying payment terms and conditions: Both parties need to agree on payment terms and conditions. Before the project, the contractor should provide an hourly fee schedule for additional work or unanticipated changes in scope. Additions, deletions or other scope modifications should always be documented with a change order that both parties sign. This prevents misunderstandings and promotes a strong relationship between producer and contractor.

Execution
Once the planning is done, the focus becomes project execution. Maintaining great communication continues to be essential and should include the following major elements:

Project status updates are critical during the execution stage, though the frequency of the updates preferred by each plant varies. Some
plant representatives want an hour-by-hour account, while others just want their contractor to get in, get out and supply updates at the end of each shift or day. Whatever the case, both parties should be clear about the reporting requirements at the beginning of the project.

Unanticipated conditions that could affect project timelines, fees and even safety should be communicated and addressed as soon as they occur. The points of contact for both parties need to discuss these unexpected situations and agree on how they will be handled. The contractor should then communicate the changes to all project personnel.

Work stoppage points for each shift or day should always be discussed by the parties. Although the planning process may address this, unforeseen situations that require longer-than-estimated work hours can occur (such as tubes fouled worse than anticipated). The parties need to consider both the project timeline and worker fatigue to keep the project safe and downtime minimal. Safety representatives from both parties should agree to the maximum continuous hours worked per shift.

Post-task inspections by plant personnel keep projects moving quickly and in the right direction. Both the contractor and producer should conduct inspections after a task has been completed and before the contractor moves on to the next task. This prevents wasted time resetting equipment and keeps the project moving forward efficiently.

Post-project evaluation
A post-project discussion is essential for both parties and should address the following questions:

1. What went well and exceeded expectations?

2. What could have been accomplished or communicated more effectively or efficiently?

3. How could a different approach have been better, faster or safer?

Although the producer and contractor won't have time to hold this discussion at the end of the project, both parties should make individual notes on these questions. Once the plant is operational and time permits, holding a wrap-up meeting is the single most effective action that the producer and contractor can take to promote continuous improvement. Involving everyone from both teams in this process precludes missing any good ideas.

Once both parties establish a template for communication and organization, their progress toward a common goal takes on a life of its own which can be hugely beneficial. The ethanol producer gets the clear information that it needs to reduce downtime continuously and keep the plant producing efficiently. The contractor becomes familiar with the producer's preferences, which eventually minimizes the preparation overhead. This type of relationship, built on loyalty, fairness and open communication will produce and amplify fantastic results over time. This, in turn, positively impacts the ethanol plant's bottom line with reduced risks. How can you beat that? EP

Brian Rinehart is vice president of operations for Hydro-Klean Inc. Reach him at brinehart@hydro-klean.com or (515) 283-0500.