Training an equipment vendor to manage unfamiliar clients and EPC companies2021, Germany
Even established vendors who are leaders in their field can struggle when their technology gets adopted in a new field and they have to deal with unfamiliar clients and different ways of working.
Dealing with a customer who didn’t know what they needed and an intermediary engineering company unfamiliar with their technology, two years of misunderstandings and frustration took their toll on engineers and management alike. They engaged Newman Eventus to help them better understand the nature of their customers, anticipate problems and their causes, and propose improved ways of working.
Our Client was well-established in their field and used to clients who knew what they wanted and with whom they had long-standing relationships. However, when their technology was adopted by an entirely new industry, not only were they dealing with an unfamiliar client but a wholly different way of working. Firstly, rather than a straightforward purchase their customer was procuring the equipment through a capital project process, which our Client was unfamiliar with. Secondly, their customer delegated much of the engineering and procurement functions to an intermediary EPC contractor who were unfamiliar with their technology. Our Client found themselves doing substantial engineering work without compensation as their customer tried to reach a position where they could place an order.
Newman Eventus identified two main problems:
- A lack of knowledge of the capital project process:
Procurement through a capital project is very different from other types of purchasing, and the vendor’s role is specific at each stage. By not knowing when the order would be placed or how to react to repeated customer requests for technical information, our Client was continually frustrated at the lack of progress and wasted substantial time, money, and resources.
- A lack of understanding of the nature of large client organisations and EPC companies:
The culture and resulting behaviours in companies supplying process equipment is radically different to those of large client organisations, and EPC contractors have different characteristics again. These differences led to multiple miscommunications and misunderstandings which resulted in a near-breakdown of the business relationships.
Using the unique combination of the formal HR training and experience of engineering project delivery through the contracting chain, Newman Eventus was able to identify and describe the different organisations’ respective roles and cultures. This allowed us to prepare a training course for our Client’s engineering, management, and sales teams to anticipate and understand the resulting behaviours from client and EPC company personnel, and respond accordingly.
The training course also described the capital project process and the respective roles of each organisation, going into detail of what vendor information is required by which entity, when, and why.
The final part of the training showed our Client how to deal with such situations more effectively by positioning themselves differently and modifying how they deliver their products.
With our training our Client was in a much better position to interface with specific customers and intermediary engineering contractors. They were able to be more assertive in developing the technical solutions with their customers, and avoided doing “free” engineering work while waiting for a firm order to be placed. Their knowledge of the capital project process has enabled them to respond to enquiries and engage with customers more efficiently, and plan their resources better.