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Value beats price in the long run

by Rodney O’Meley, Maxibor, CEO

As we move through these challenging times, it is important that civil construction projects involving trenchless technology continue to be delivered with quality, safety and broader value in mind. A fair and reasonable price that properly considers these factors will lead to better infrastructure projects for all stakeholders. 

Risks will be reduced and opportunities will be optimised through a more cooperative approach in both the project design and delivery phases. Maxibor applies this approach in the context of the delivery of horizontal directional drilling (HDD) design and construct services for projects. Whether it is a 100 m long 63 mm telecommunications bore, a river crossing, a gas pipeline or a 1 km long 800 mm water pipeline, the same approach is taken so that value can be optimised for all stakeholders.

There is a wide range of stakeholders in any infrastructure project including asset owners, contractors (Tier 1s, major contractors, subcontractors) and their employees, materials suppliers, design and other service providers, regulatory agencies, funders, insurers, the local and broader community plus the environment. 

If all work cooperatively through this process and are respectful of each other’s needs, then strong trusting relationships will build, and the delivered project response will be a win for all – and more work will also be won by all the service providers. 

Considering this in the context of Maxibor as a leading HDD design and provider, the following are some of the benefits that flow from the company’s value based cooperative and knowledge sharing approach:

• A design that can be constructed without surprises.

• Leading design expertise which provides asset owners and clients significant savings on design and construct plus reduced time to achieve approvals from authorities.

• A price that ensures the full scope of works is consistently delivered to the required level of quality and on schedule. 

• Full compliance with safety and environmental needs of the project monitored by an internal HSEQ team.

• A large fleet of rigs, cleaners, other plant and tooling which always enables the right equipment to be applied to the project.

• Plant and crew resources based across Queensland, New South Wales and Victoria to enable ready mobilisation (and overcomes COVID-19 border restriction impacts).

• Capacity to handle the upsurge in activity as more infrastructure projects commence as part of the economic recovery process.

• Cooperative client and other stakeholder relationships that facilitates project challenges being more easily communicated and successfully overcome.

• An ability to impress the asset owners with quality, safety and on schedule delivery to the benefit of the principal contractor (in winning future business).

• A pricing structure which reasonably prices the more complex bores on the basis that a good volume of work will be provided through the relationship on other projects.

• A proactive approach to engaging with local suppliers and Indigenous businesses.

• A proactive media presence in which we help promote those that deal with us in a cooperative and positive manner. 

• A valuable network of respectful relationships across the infrastructure sector at an asset owner, Tier 1, major contractor, supplier, design consultancy, industry advisor, media, industry organisation, Indigenous business and organisation and other people of influence. 

These examples apply equally to any sized rig projects. It is really all about building relationships, respect and responses if business-to-business interactions are to be sustainable and outcomes optimised, especially in the challenging times of COVID-19 and economic recovery.

We are finding this approach is particularly attractive to many asset owners, Tier 1s and major contractors. It is leading to a wealth of opportunities for Maxibor across the infrastructure sector covering power, gas, water and sewer, telecommunications, rail, roads, renewables and mining. 

Increasingly, our clients are recognising that Maxibor delivers a quality service and honours it commitments to schedule. They prefer a fair and reasonable price, which works to reducing the risk of the higher exposure trenchless activities on the current and future projects.

Maxibor is now a company many others want to be associated with because of its well-established network of respectful relationships across the infrastructure sector and broader community. 

It is worth noting that our asset owner, Tier 1 and major contractor clients are also increasingly telling us they are seeing players in the HDD market who are on a cycle of low bidding purely to secure work. They are telling us their experience is that quality of service from low-priced bidders is often compromised and corners are being cut, which over time has exposed them to unacceptable risks including: 

• Inability to complete all allocated bores on projects leading to time delays and the need to bring in more capable drillers to complete more difficult work at a higher cost/m due to the urgency to fix the problem.

• Frac outs due to lack of appropriate equipment, poor drill fluid management or inexperience with difficult ground conditions. 

• Shortcuts taken on safety, regulatory environmental compliance (plant maintenance, worker safety, access areas, vegetation damage and non-compliant disposal of drill mud).

• Contractors running low cost, lower-skilled and inexperienced HDD crews to try and complete the project to the budget they have.

• Bore holes not being properly cleaned with consequent damage to the pipe.

• Breakdown of relationships between asset owners and lead contractors resulting in no future business for the lead contractor from that asset owner.

Our clients are also telling us they stand more chance of winning future work through quality of performance – their clients, being the asset owners, do not want project issues which become headlines (internally and definitely not externally). 

The message for the HDD and other trenchless service providers is clients are increasingly looking for value to be brought to both the project and to the business through a strong enduring relationship with the trenchless provider. A low, one-off transactional price will clearly not optimise value in the long run.

This article was featured in the December 2020 edition of Trenchless Australasia. To view the magazine on your PC, Mac, tablet or mobile device, click here.

For more information visit the Maxibor website.

If you have news you would like featured in Trenchless Australasia contact Journalist Sophie Venz at svenz@gs-press.com.au

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