Preliminary Investigations into Capital Projects Supply Chain Management


In the previous edition of this Journal, we outlined a three-phase research program to explore ordering and scheduling practices that lead to earliness and delays in materials and equipment delivery in capital projects. Usually, owner-operators and their EPC’s look to minimize the risk of schedule delays due to late materials and parts delivery by mandating that parts and materials be delivered far in advance of when they are needed. In contrast, many other industries, including automotive, retail and technology, coordinate orders and deliveries more closely with actual needs to better optimize overall system performance.
We hypothesize that holding large amounts of inventory long before it is needed on capital project sites is a symptom of sub-optimal supply chain operation. To better understand these issues, we have completed the first phase of our research program – a set of interviews with a variety of consultants and project and supply chain managers in the oil & gas industry, during which we asked them to respond to a set of questions so that we could better understand current industry views of supply chain management, inventory, risk management tools and related topics. In this digest, we summarize initial findings from the interview responses and outline steps to explore additional questions they have raised.

Journal of Project Production Managemenet