Project supply chain management: From agile to lean

Abstract

More than forty years has passed since the start of the North Sea oil and gas developments. On the managerial side of the projects there have been large cost overruns, project planning and control measures developed to avoid these, initiatives to improve the industry’s competitiveness in the North Sea, as well as measures to improve the supply chains contribution in the projects. We have seen a focus first and foremost on the CAPEX side of the projects, which still is the public measure of a ‘project’s’ success as seen in medias coverage. However, the operation side of the project has been given extended focus, especially through life-cycle cost measures, and life cycle value measures trying to balance out the CAPEX, OPEX and income sides of the project to obtain the most commercial value enhancement from each project. At the same time there has been an increasing focus on the core business among the project demand and supply chain actors in this industry as in most other industries.

Our belief is that this necessitates an enhanced focus on the project demand and supply chains of the industry, both for the projects development and operations phases. A question is whether the project demand and supply chain developments are approached appropriately according to the characteristics of the industry’s project context?