Building relationships is No. 1 when choosing contractors – BIC Magazine
Building relationships with contractors is a simple concept, but one that is foundational to the success of any project, be it large or small in scope.
“When it comes to hiring contractors, it’s important to get it right,” said Gerard Celestine, maintenance support manager with Motiva Enterprises, during the 2022 AFPM Summit held recently in San Antonio.
But finding and developing the right partnership with essential, trustworthy contractors and increasing value and efficiency to plant maintenance can be a challenge, he added. “We all know it is about the relationship and how you begin, live and sustain it,” he said.
The ideal contractor expertly possesses a number of vital traits, Celestine continued, including safety, reliability and value.
Another key, Celestine said, is to understand the budgeted resources to retain the contractor.
“So often we say it’s going to cost you this much and don’t realize that there’s a little bit more on the back end. You have the flexibility of coming in big or going home small,” he said, adding that quality and demonstrated innovation are also of utmost importance.
“You don’t want to have a contractor or organization that just does what you say, but one that also thinks outside the box, and challenges you sometimes,” Celestine said.
“That is always good and growing that relationship to give them the opportunity to feel comfortable to challenge you is even better.”
Another positive trait of an ideal contractor, interestingly enough, is someone who refuses the work rather than being a failure.
“So often we bring in companies and say to them, ‘Hey, can you go do this? And they say, ‘Oh yeah, I’m all about that.’ And then they fail and cost us three times as much.”
Perhaps the most important question for a company to ask itself is what is its motivation for engaging a contractor in the first place. “Why are you doing this? What’s the benefit? Why are you wanting to change out a vendor? What’s going on in this space? We usually get that challenge from our procurement people,” Celestine said.
“It’s imperative to ask ‘Why are we doing this?'” Mark Hutton, direct services category manager with Motiva reiterated. “Is it because of contracts expiring? Is it because of the lack of performance from our current contractor? Maybe we have one primary contractor, then all of the sudden we have multiple contractors who appeared. There are multiple reasons why we get there.”
One of the initial concepts to tackle, Hutton recommended, is understanding how the company that seeks a contractor is currently running its business.
“We’re going to look at processes and how we deliver work to the supplier; we’re going to look at spend, so we use SAP (simplified acquisition procedures),” he said. “We also look at hours for classification.”
“And I’m really looking at volume and volume costs,” Hutton continued. “And I’m looking at processes – uncovering rocks and really trying to understand how we’re operating this business.”
Hutton said he wished there were a formula for determining the right contractor for a project.
“You know, it’s not really a one-size-fits-all process.” Hutton said. “Depending on what category or what you’re trying to source, you may go through different steps.”
Though not a formula perse, Hutton said there is a “generic process” to choosing the right contractor.
One of the most important pieces to that process is “continually improving and maintaining that relationship with that partner,” Hutton said. “It’s actually somewhat a circle, because at some point in time you’re going to look back and get the market shifted, contracts are expiring, and rates are going up. You’re going to say, ‘Hey, I think it’s time to take a look at this again, and we’re going to start the process over again. So, it is somewhat of a circular process.'”