Study on Procurement

Situation

The client, a world leader in specialty chemicals, was planning to launch a worldwide study on procurement of equipment and services, including a China chapter, in cooperation with a large consultancy. It was requested for the China business to provide a global and detailed view of the situation in the different plants and to manage the relationship/communication with the consultants’ team: number of PO, amount and types of CAPEX, OPEX. 

Solution

We proposed a manager with 10 years of experience in sourcing and procurement management, including 7 years of experience in China, with technical background and a Master’s degree in chemistry, who investigated and visited the company’s plants in China and collected all procedures and compiled a data base following the consultancy’s requirements.

Results

The mission lasted 6 months and resulted in setting up a clear methodology of processes based on the worldwide study for all of the company’s plants to follow, including in China. Previously, the four different plants in China were following different methodologies.   

Integration of Newly Acquired Company

Situation

The client, a chemical company, had acquired 51% of a 600 employees Chinese private company, twice the size of its first 100 % acquisition in China.

The challenge was a smooth integration of the newly acquired company since it intended only to change what was at risk of jeopardizing the business and maintain good procedures of the local company after their evaluation. The client approached X-PM China through a WIL Group member in its country of origin. 

Solution

X-PM China put in place a bicultural Chinese senior manager, mainly to:

• develop mutual trust between the two shareholders
• improve the safety of the site with the help of the client’s safety experts, a priority for the client
• convince the local partner that it was necessary to adapt the same standards as the new owner company with regards to budgets planning of production and finance and fully accompany the Chinese JV during the first budgeting year

Result

After the 6 months mission, both the client and the top management of the acquired company were very pleased having established the foundations of a win-win cooperation, which was still fully valid years later.

Capex Management of USD 500 million in China

Situation

The client, a former French company now part of Sinochem—the world leader in chemistry—is a global leader in the production of amino acids for animal feed. The client invested approximately USD 500 million to double the production capacity of a plant built seven years earlier in China.

Solution

X-PM China provided part of the client's team, including an English Project Director with extensive experience in construction, a Deputy Project Director—French national, Chinese-born, with dual engineering education—and a Taiwanese Controller, forming a highly international team.

The Project Director on the client's side is a key position. Supported by a small team (including the Deputy Director, Process Manager, Controller, HSE Manager, etc.), he continuously challenged the EPCM engineering team to ensure adherence to the CAPEX budget, delivery schedule, safety performance, construction quality, and other critical parameters.

Results

The extension took almost three years to complete, making the plant the largest and most technically advanced and competitive of its kind worldwide. The success of this project led to X-PM's involvement in CAPEX investments in two other locations, amounting to over USD 1 billion.