The Methodology of Long-Term Cooperation with Key Contractors in the Construction of Industrial Facilities

Abstract

The article examines the methodology of contracting key contractors in the construction of industrial facilities, which is implemented in the NLMK Group with the aim of increasing the efficiency of managing investment projects. The author analyzes the features and advantages of this methodology, as well as describes the process of selection, conclusion of contracts and evaluation of the activities of key contractors. The article contains practical recommendations for the introduction and development of the methodology of contracting key contractors in the construction of industrial facilities. The methodology of contracting key contractors implies the conclusion of long-term framework contracts with qualified contracting organizations, considered as reliable strategic partners for building long-term mutually beneficial relationships with the aim of more effective management of investment projects. The purpose of this methodology is to increase the efficiency of managing investment projects by optimizing the terms and costs of construction and installation works (CIW), improving the quality of completed works, strengthening the responsibility of contractors, as well as developing their competencies and material and technical base. The author considers the main stages of the process of selecting key contractors, including qualification, approval of criteria for assigning to the status of "Key", conducting an audit check and concluding a framework contract. The author also analyzes the conditions of the framework contract, including the procedure for determining the price of work, mechanisms for stimulation and control, as well as a list of objects for which a Key contractor can receive volumes of CIW. For each specific object, a general contract is concluded, which specifies the volume, cost and timing of work. The author also describes the process of evaluating the activities of key contractors, which is carried out on a regular basis and is mandatory for all Key contractors. The evaluation of activities is carried out by tracking key performance indicators (KPIs) for quality and timing of contractual obligations and implementing measures aimed at maintaining them within established (target) values. The evaluation of a Key contractor includes conducting an audit check, which is carried out according to a standard (recommended) form of the Program for evaluation and development of a Key contractor and includes four sections: technical equipment of the organization, availability of personnel and their professional qualifications, organization of work, organization of labor protection, industrial safety and environmental protection. The author summarizes the analysis of the methodology of contracting key contractors in the construction of industrial facilities and highlight its main advantages for the Customer and the Key contractor. The author also gives practical recommendations for the introduction and development of the methodology of contracting key contractors in the construction of industrial facilities, as well as indicates possible directions for further research on this topic.