Supporting Frameworks for Successful Program Management - Procurement (#22 in the series Foundations, Frameworks and Lessons Learned in Program Management)
By Robert Prieto
Program management provides the opportunity to achieve increased leverage on total spend through consolidation of select procurement activities related to major commodities, common equipment and major services. A program management approach will likely result in increased usage of common supply contracts and CFM to discrete projects. A programmatic procurement strategy increases visibility of common cost drivers and opens up additional management strategies and hedging options.
Programmatic procurement activities will also include more comprehensive and robust activities related to:
- supplier diversity
- supplier quality surveillance, including permanent in-shop teams for major suppliers delivering throughout the full program cycle
- material management
- material transport and logistics, including forward contracts
- supplier integration, including increased pre-assembly
- export/import control and expedited customs processes
- escalation and hedging strategies
- performance benchmarking
- warranty provisions and durations
- required spares and commissioning support
- implementation of supplier relationship agreements
New contracting strategies are also facilitated through a program approach to achieve strategic business objectives including use of a:
- master electrical contractor
- master automation contractor
- dedicated startup & commissioning team
- procurement of select facilities on a delivered service basis as opposed to a direct ownership basis (off-balance sheet financed; paid for usage or availability of service; eg. power, potable water)
Robert Prieto, Senior Vice President
Robert Prieto is senior vice president for Fluor, where he leads strategy for Fluor’s Industrial and Infrastructure group. Mr. Prieto focuses on the development and delivery of large, complex projects worldwide.
Prior to joining Fluor, Bob served as chairman of Parsons Brinckerhoff Inc. As head of PB’s board of directors, he was responsible for overseeing management performance, establishing top-level policies, and ensuring the firm’s continued long term success.
He is a member of the executive committee of the National Center for Asia-Pacific Economic Cooperation, a member of the board of directors of the Business Council on International Understanding, a member of the board of the Civil Engineering Forum for Innovation, and co-founder and member of the board of the Disaster Resource Network. He currently serves on the National Research Council’s committee framing the challenges on Critical Infrastructure Systems. Until 2006 he served as one of three U.S. presidential appointees to the Asia Pacific Economic Cooperation (APEC) Business Advisory Council (ABAC) and served as chairman of the Engineering and Construction Governors of The World Economic Forum and co-chair of the infrastructure task force formed after September 11th by the New York City Chamber of Commerce. He is also a member of the board of trustees of Polytechnic University of New York, and was previously selected as alumni of the year by its New York Chapter.
He has had an executive sponsorship role in the World Trade Center Transportation Hub; West Coast Rail Modernization; Train Protection and Warning System; Level 3 Communications Long Haul Network and Superconducting Super Collider.
Prieto holds a master of science in nuclear engineering from Polytechnic University of New York and a bachelor of science in nuclear engineering from New York University.
Fluor Corporation (NYSE: FLR) provides services on a global basis in the fields of engineering, procurement, construction, operations, maintenance and project management. Headquartered in Irving, Texas, Fluor is a FORTUNE 500 company with revenues of $14.1 billion in 2006. For more information, visit www.fluor.com.
- Supporting Frameworks for Successful Program Management - Introduction
- Supporting Frameworks for Successful Program Management - Audits
- Supporting Frameworks for Successful Program Management - Ethics Training and Compliance
- Supporting Frameworks for Successful Program Management - Cost Estimating
- Supporting Frameworks for Successful Program Management - Contingency Management
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