Ensuring Project Success and Profitability: The importance of designers in engineering projects. August 28, 2015May 21, 2018 HMdev1 Chris Chandler Contributed by Chris Chandler – Design Coordinator _____________________________________________________________ Ensuring Project Success and Profitability: The importance of designers in engineering projects. Sometimes engineering companies only have one chance to provide services to a client. The future relationship depends greatly on the package delivered. Whether mechanical or E&I, providing a quality package on schedule is usually the deciding factor whether or not projects will be awarded in the future. Profitability is a major factor when determining if an engineering company will survive and be able to provide their services in the future. While all members of the project team play an important role, the designer’s contribution can really make or break things in terms of profitability. Have you ever wondered why a client uses a particular engineering company over and over again? Or worse, why they never use them again? The three main factors include: Cost of services Quality of the package Schedule Designer payroll can be a large portion of engineering project cost but what they produce, if done right, is worth every penny. Often, the majority of charged hours come from the designers on the project. This makes it increasingly important to know your staff. If a top paid designer consistently spends 1 hour a day out of a 10 hour day (10% of their time) being unproductive, project profitability will suffer. These situations are not uncommon and must be fixed quickly and prevented from the beginning if possible. The experience type and level of an assigned designer can also affect the bottom line of the projects they work on. This is a huge indicator for success. They must have the skills to complete the task efficiently. Even though small capital projects include most of the same metrics as large capital projects, the way the designer approaches and works the job should be evaluated before kickoff to ensure small capital characteristics are taken into account. Smaller projects may not allow the built-in overhead costs that are usually part of a large job. 1% of a 10,000 MH project allows 100 hours for printing, document control, and other overhead costs. On the other hand, 1% of a 1,000 hour job only allows 10 hours for these functions. This means the designer must manage resources properly while working these smaller types of projects to stay within budget. Whoever does the hiring for a company needs to understand the company’s project style and hire accordingly. 10% of a small project may be as little as 100 hours (two and a half weeks). If a senior designer is hired to lead projects for smaller cap revamp type projects but is only experienced leading large capital projects it is likely that efficiency and profitability will suffer. A designer working on smaller revamp type projects will need to stay flexible and be able to wear different hats to ensure success. If they are not willing to step outside the boundaries of the typical designer role, the costs may become too high. A 1,000,000 MH green field project over a two year period could employ a survey team, multiple senior designers, multiple modelers, CAD operators and a document control team. There is enough work in larger projects to justify this type of team and those teams members will probably remain in these roles for most of that time. On a small revamp project, let’s say 4,000 hours, there may only be one senior designer in each discipline acting as a working lead for one or two CAD operators. The senior designer must understand what tasks he can do efficiently. They must also realize when/if to manage and delegate to the CAD operators or other available team members. If the senior designer understands this and efficiently utilizes lower level drafters or CAD operators, the composite rate throughout the project will keep project costs within budget. The goal of any Engineering company should be to provide the client with a package that will make the project a success. The client hopefully understands that the company must also make a profit to be around for bidding on the next project. Projects can be successful to both clients and the engineering company if it is staffed with the right designers that set both sides up for success….it’s a win win! _____________________________________________________________ Chris Chandler – Design Coordinator at H+M Industrial EPC Chris has more than 30 years experience in piping design, coordination and project management in industrial settings. His project design and supervision responsibilities have ranged from small capital projects to multimillion dollar projects. Chris has worked at H&M for ten years, with previous work experience at Jacobs, CDI, Enterprise Products and Mustang Engineering.