Optimizing the Procurement Process

In most cases, procurement of filtration and separation equipment is part of a capital project, including new plant construction or renovation and upgrade. If the usual engineering, procurement and construction (EPC) model implies procurement activities are sandwiched between engineering and construction, results will be less than optimal. Unlike heat transfer or distillation systems, filtration systems are difficult to model, and can be configured very differently in commercial practice compared to laboratory and pilot work.

Early procurement activities can occur before engineering. Procurement should be involved at the earliest stages of equipment evaluation. Even long after construction is completed, warranty and remedy issues can remain open in the procurement department. Closer collaboration between all three functions improves the odds that a project will be successful.

Although a great deal of procurement attention focuses on repetitive and systematic work such as raw materials management and maintenance, repair and operations (MRO) concerns, another aspect of procurement first must be completed. Capital equipment procurement occurs first.

This review reflects experience in filtration-equipment-related procurement for a chemical manufacturing firm, but the same principles apply to many manufacturing endeavors. The chances of a procurement effort's success improve with increased knowledge.

Without a client, no project exists. Ideally, the buyer should be serving his clients long before specifications are written for commercial equipment. Involvement in the early stages of equipment evaluation and specification enables the buyer to serve his client more effectively. Although the client knows his process and his needs, the buyer will know the latest developments in the equipment markets. During these early stages of work, the procurement representative can offer valuable information about alternatives for commercial equipment.

If the requirement is liquid/solids separation, the procurement representative should know who is offering different configurations of filters, screens and centrifuges. The client knows what the production line must accomplish.

During early work, the client might represent operations or research and development (R&D). That same client could remain involved through the life of the project, but additional clients could join the team before commercial-scale equipment is specified. The new clients will include the project engineers and project managers who make the new plant a reality.

Discuss which equipment and material requirements are on the critical path for the project. Do any large or difficult items need to be received and placed before the structure is finished? This might be necessary for large separation equipment such as rotary screen filters or pressure nutsche filters.

What other extended lead items are required for the project? How will late (or early) delivery impact the overall project schedule? How urgent is the project schedule? Does the new plant provide an improved way to make a current product? If so, deliveries to current customers might not be restricted by project delay. In other situations, there will be no room for delay.

Your procurement consultant should know the specifications. Do you have a mechanical specification telling the supplier how to build the item, or do you have a performance specification spelling out the capabilities that must result from use of the item? When buying a supplier's proprietary equipment, or when the supplier's scope includes technology and equipment, a performance specification is more appropriate.

Filter systems and centrifuges almost always will involve the supplier's proprietary design, so a performance warranty is appropriate. Procurement will review the specification from a supplier's viewpoint and try to determine if it is complete and unambiguous. Was the specification copied from a sample or template? If so, was the template consistent with the intent (performance vs. mechanical) of this specification?

The procurement department sees a wide variety of specs, and your consultant could use a checklist to review the specification. If a performance specification is needed, it must be based on proven process experience. Proven experience can be based on laboratory work, pilot operations or past commercial experience. The performance warranty will be scaled up from that source. It should be possible to review the basis for scaleup and to recognize whether or not the warranted separation performance is comparable to proven results.

It also is important to know if the material supplied for testing and evaluation is representative of the material produced by the new process line. Minor differences in upstream processes can make the production material differ slightly from the pilot samples.