Effective Logistics Fulfilment for EPC Projects

Written by Nithianandan Suprimaniam, PDLM

Effective Logistics Fulfilment for EPC Projects

Written by Nithianandan Suprimaniam, PDLM

by Nithianandan Suprimaniam, PDLM

EPC refers to projects involving engineering, procurement, and construction. The term ‘Order fulfillment’ is commonly used to describe the act of distribution (logistics) or the shipping function. In a broader sense, it refers to the many ways firms respond to customer orders, and the processes they follow to move sold products or services to a customer.

Logistics management is the part of supply chain management that plans, implements, and controls the efficient, effective forward, and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customer’s requirements.

The challenges facing the construction industry include labor shortages, stagnant productivity level, safety and adoption of technology. The construction industry is not attracting enough talent to meet growing demand. Firms are having trouble finding qualified workers. Workers in construction are aging out and retiring at a faster rate than the younger generation is coming in.

Effective Site Planning

Plan site set-up to move labour, plant, and materials around site efficiently (e.g. hoarding, gates, site accommodation, cranes, hoists, security, temporary services, material delivery, and waste management strategy, catering).Plan internal and external logistics routes through the project phases focusing on separation of vehicles, machinery, and people. Lay down areas and offloading points. E.g. Hoists can be mounted in a variety of ways. Pre-plan the usage of hoists to ensure planned asset meet the needs of the program.

Peak Planning and Execution

It’s always a challenge to deliver a successful peak period due to the continued growth in e-Commerce and national retail events like Cyber Monday. However, the peak is a crucial time of the year for many businesses, especially those with seasonal spikes – and navigating it successfully is the key challenge. Competency in e-Commerce, particularly in managing its ongoing growth, is fundamental, along with excellent forward-planning, performance analysis, and forecasting – all of which fall under the umbrella of peak planning and execution. Access to information is a key factor in delivering a successful peak, so getting the right people on board that understand and know how to manipulate data is key. They’ll also need to possess comprehensive knowledge of the interim marketplace at all levels, as the workforce expands according to demand.

Logistics Strategy

Logistics is not confined to tactical decisions about transportation and warehousing. Logistics strategy is the set of guiding principles, driving forces and ingrained attitudes that help to coordinate goals, plans and policies between partners across a given supply chain. Article body. The four types of logistics are supply, distribution, production and reverse logistics.

A formal logistics strategy provides a foundation for the constantly changing nature of the supply chain. Companies are better prepared to be flexible and adapt to the changes with a logistics strategy in place. Not having one in place means companies will not be prepared to gauge the impact of any change in the supply chain has on its operations. This negligence can significantly impact customer service.

In the logistics strategy, there are 2 important areas that need careful consideration.

1. Develop Logistics Plan

Strategic logistics plans define how business plans to deliver products or services to customers. It addresses logistics in a methodical way that allows your business to scale operations or increase profitability and the importance of logistics on construction sites. In the above case, logistics is defined as the planning, execution, and control of procurement, transport, and stationing of workers and material and other resources to achieve the goals of a construction project.

Distribution resource planning (DRP) is a method used in business administration for planning orders within a supply chain. DRP enables the user to set certain inventory control parameters (like a safety stock) and calculate the time-phased inventory requirements.

2. Operations Planning In Logistics

Logistics is the management of the flow of goods from the supply to the point of consumption. Operation planning is a process that seeks to understand and develop operational processes. Inventory/stock control is a critical part of supply chain management.

Supply Chain Management

Describe the characteristics of the site, including site access/egress, storage capacity, and arrangement by programmed, labor, hoists, cranes, etc. Use the description to produce daily, weekly and long term movement’s plans. Plan and integrate with key contractors to meet the needs of the planned programmed and de-confliction of onsite space and time where appropriate.

Supply chain strategy is an iterative process that evaluates the cost-benefit trade-offs of operational components. Business strategy involves leveraging the core competencies of the organization to achieve a defined high-level goal or objective.

It can happen when a company is more concerned with internal process improvements than the needs of its customers, stakeholders, or the supply chain as a whole. A supply chain, therefore, could be efficient and effective, neither efficient nor effective, efficient but not effective, or effective but not efficient.

Adopt Technology

The EPC industry has been continuously evolving over the last few decades as a result of tremendous changes happening in the business and technology areas of this industry. Technology has taken rapid strides but disruptive technologies such as cloud and mobility have necessitated a complete transformation of this industry vertical.

• Wearables & Mobility

Wearables are improving the ways workers interact on the job. This technology can ensure the moving parts of a job are in place and accounted for. Mobile and cloud-based systems can connect workers to projects in real-time. Seamless connection between back offices and workers in the field means real-time inputs of critical project data for analysis and response.

• Predictive Analytics

Poor risk management leads to an inevitable crisis. One or two crises and your firm are in trouble. Predictive technologies can help construction firm with risk management in analyzing of all project levels–suppliers, plans, and the site itself. It helps identify the most problematic areas so teams knew where to begin. It’s an example of how a high-tech investment can save companies from losses and disaster.

• Virtual Reality

Virtual reality has become a part of the preconstruction process itself. It’s a low-stakes way to visualize an entire project and make critical changes. Virtual reality tools help prevent problems or disasters before construction begins. It’s a great way to increase efficiencies before all the greater investments. It also opens doors to greater creativity during design phases.

Conclusion

A combination of best practices seen in other industries and shared software systems can improve reliability and shorten lead times as compared to totally manual processes. Digitizing procurement and supply-chain workflows will enable improved logistics management and just-in-time delivery. An effective logistics fulfillment is crucial in enhancing efficiency and productivity, having a positive overall impact on cost and time. With the above-discussed strategies in place, the logistics process for EPC projects will be greatly enhanced in its effectiveness and efficiency.


References

Adam Robinson. (2018). “What is Reverse Logistics and How Is It Different than Traditional Logistics?” Retrieved from https://cerasis.com/what-is-reverse-logistics, accessed 02/07/2019.

Brian Bass. (2019). “Logistics & Operation Planning”. Retrieved from https://smallbusiness.chron.com/logistics-operation-planning-14618.html, accessed 03/07/2019.

Chris. (2011). “What is Order Fulfillment?” Retrieved from: https://www.rileylife.com/blog/what-is-order-fulfillment, accessed 01/07/2019.

Michael Page. (2018). “10 skills your logistics team need to know”. Retrieved from https://www.michaelpage.co.uk/our-expertise/logistics/10-skill-your-logistics-team-need-know, accessed on 02/07/2019.

Mohamed Hardi Bin Abdullah, GDLM. (2018). “Autonomous Trucking in Logistics Transportation”. Retrieved from SIPMM: https://sipmm.edu.sg/autonomous-trucking-in-logistics-transportation, accessed 04/07/2019.

Sonia Lai Jie Yin, DLSM. (2018). “Key Success Factors for Effective Logistics Practices”. Retrieved from SIPMM: https://sipmm.edu.sg/key-success-factors-effective-logistics-practices, accessed 04/07/2019.

About the Author: Nithianandan Suprimaniam has over ten years of experiences in the field of logistics and transportation management, specifically in the engineering, procurement, and construction (EPC) sector. He is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Nithianandan completed the Professional Diploma in Logistics Management (PDLM) on June 2019 at SIPMM Institute.

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