FEED the Project to Reduce Capital Costs and Increase Profitability

A common theme that emerged at ARC Advisory Group's recent Industry Forum in Orlando is that capital projects today frequently take too long to execute, cost too much, and involve too much risk. This costs industrial organizations millions of dollars in capital expenditures and lost production, even for relatively short delays. This impacts both profitability and overall business performance.

According to many owner-operators and EPC (engineering, procurement, and construction) contractors, automation is often on the "critical path" in these project delays. Incomplete front-end engineering design (FEED) issues that can linger throughout the project and much longer operating phases of the plant lifecycle are particularly problematic.

A major part of the problem is that owner-operators and their EPCs alike have an increasingly limited pool of skilled workers, particularly those with in-depth knowledge of the industrial processes and associated automation technologies. This makes it challenging to protect margins and meet continually changing customer demands and market conditions. Faced with dwindling human and capital resources, everyone is being asked to "do more with less."

In response, a handful of leading automation suppliers have beefed up their own resources and marshalled their technologies and know-how to be able to offer their own FEED services. The objective is to help take automation off the critical path for both capital projects and ongoing operations.

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Keywords: Project Execution, Engineering, FLEX, Costs, Risk, Lean, Automation, ARC Advisory Group.