Document Ea17VYRzDadb1VOpgkgv8Od4
f
*y
N.I42S *6V S-B2
ITUKJSMC8 lK
E. I. d u Po n t d e Ne mo u r s 51 Co mp a n y
tNCOftf*OftATCO
Wil min g t o n , De l a w a r e 19898
ENGINEERING DEPARTMENT LOUVIERS BUILDING
December 5, 1983
O. L. BRANNEN - C&P - BRANDYWINE J. M. BURKHART - C&P - BRANDYWINE H. B. CLARK - C&P - BRANDYWINE E. C. NELSON - C&P - BRANDYWINE P. M. NORLING - C&P - BRANDYWINE C. C. QUKBLES - C&P - BRANDYWINE V. R. SCHMALBACH - C&P - BRANDYWINE H. J. STRANSKY - C&P - BRANDYWINE D. I. GARNETT - C&P - EXPERIMENTAL STATION F. KNOWLES/R. E. BOCKRATH - C&P - EXPERIMENTAL STATION P. L. MEREDITH - C&P - EDGE MOOR F. A. VOGELSBERG - C&P - EDGE MOOR S. C. DOBERSTEIN/G. J. O'BRIEN - C&P - JACKSON LAB N. E. KRAUSS/C. J. SLENTZ - C&P - JACKSON LAB G. E. LYNSKEY - C&P - JACKSON LAB p. a . w r imm- c&p - j a c k s o n l a b R. FREAS - C&P - MEMPHIS C. A. BAXTER - RDO - UP N. P, BRECHTEL - DESIGN L. T. FINNICUM - DESIGN J. P. MURPHY - DESIGN S. M, PEPPER - BM&I W. W. CHEATHAM - CONSTR J. D. ANDERSON - ESD
INTERDEPARTMENTAL SEMINAR
Attached are the speakers' notes and information from the October 26, 1983 Seminar.
DESIGN DIVISION Chemicals & Pigments Section
T. L. Goode Project Manager
TLGrlrg
Atchs
N 31728
f
INTERDEPARTMENTAL SEMINAR DU PONT COUNTRY CLUB - GOVERNOR'S ROOM` Wednesday# October 26# 1983, 8:00 am to 3:00 pm
INDEX OF NOTES A. Introduction - C. C. Quarles B. Project Front-End Loading - L. T. Finnicum' C. R&D Perspective of 1984 Capital Budget - H. B. Clark* D. Project Activity in RDOs - C. A. BaxterE. Project Critique - C. C. Quarles F. Quality Control Performance and Vendor Relations -
H. J. Stransky. G. Panel - J. P. Murphy, J. P. McFadden, R. H. Dunlaps'
N 31728.01
DUP050146484
r
WELCOME TO
THIRD ANNUAL SEMINAR OF
ENGINEERING DEPARTMENT DESIGN DIVISION AND
CHEMICALS AND PIGMENTS DEPARTMENT DEPARTMENTAL ENGINEER'S OFFICE
CCQu a r l e s /c a r
10/26/83
N 31728.02
DUP0S0146485
DES.IGfl/DEQ .SEMINARS
1981
PURPOSE AND BACKGROUND FOR SEMINAR JOINT MISSION, FUNCTIONS, EXPECTATIONS CONSTRUCTION FORECAST PREPARATIONS AND VGA'S FOR FORECASTS COMMUNICATIONS, CONTACTS, RELATIONS SMALL PROJECTS GROUP DISCUSSIONS
PROJECTS STATUS REPORTS, CHANGE ORDERS, REASON FOR PANIC SITUATION
1982
PROJECT OBJECTIVES LETTERS ACCURACY OF ESTIMATES COST OF CONTRACT ENGINEERING ENGINEERING WORK REQUESTS
CCQu a r l e s /c a r
10/26/83
DUP050146486
PRELIMINARY OUTLINE FOR INTERDEPARTMENTAL SEMINAR ______________ KICKOFF TALK - J. T WARD
Purpose and Background for Seminar
Background
Charter of Engineering Department/Design Division
Size of Effort
Opportunities for Improvement
Flexibility - Varying Work Loads Cost - Comparisons Response - Backlog/Front End Loading Quality - QA Programs Accountability - Overruns
Difficulties and Uncertainties
Forecasting (Maintaining Forecast) Efficiency - False Starts, Prolonged Schedules Expectations/Resources - Qualifications for Judgement Firmness of Data and Decisions - Recycle Relationships - Customer/Vendor
Purpose
Understanding of Mutual Objectives
Setting of Goals for Improvement
-7-
DUP050146487
"IN SEARCH
OF EXCELLENCE"
CCQu a r l e s /c a r
10/26/83
DU P050146488
QUR VALUE
Bo t h DEO a n d En g in e e r in g De p a r t me n t e x is t b e c a u s e o f
PERCEIVED VALUE - BECAUSE OUR CUSTOMERS BELIEVE WE HAVE A HIGHER VALUE IN USE THAN THE OTHER ALTERNATIVES AVAILABLE,
Th a t p e r c e p t io n is n o t u n if o r m f o r e it h e r DEO o r
En g in e e r in g .
Me b o t h h a v e a c o n t in u in g c h a l l e n g e t o in c r e a s e o u r
ACTUAL VALUE AND, THEREBY, OUR PERCEIVED VALUE.
u a r l e s /j c c
DU P050146489
.Pe r c e iy e d Va l u e
Qu a l it y Sp e e d Re s p o n s iv e n e s s Te c h n o l o g y Se c u r it y Ex p e r t is e
1^8^u a r l es /j c c
DUP050146490
El SHI ATTRIBUTES QE
EXCELLENT, INNOVATIVE COMPANIES
A BIAS FOR ACTION CLOSE TO THE CUSTOMER .AUTONOMY AND ENTREPRENEURSHIP PRODUCTIVITY THROUGH PEOPLE HANDS-ON VALUE DRIVEN STICK TO THE KNITTING SIMPLE FORM, LEAN STAFF SIMULTANEOUS LOOSE-TIGHT PROPERTIES
CCQu a r l e s /c a r
10/26/83
DUP050146491
"IF YOU DON'T SHOOT FOR ONE HUNDRED PERCENT, YOU ARE TOLERATING MISTAKES, YOU'LL GET WHAT YOU ASKED FOR."
CCQu a r l e s /c a r
10/26/83
DUP050146492
REPORT CARD DESIGN/DEO/R&D
CCQu a r l e s /c a r
10/26/83
DUP050146493
Ar e a s Ne e d in g Imp r o v e men t Sa f e t y Re l ia b il it y o r o p e r a t in g u t il it y Ma in t e n a n c e c o s t s Fr e e d o m o f s t a r t -u p p r o b l e ms Qu a l it y a s s u r a n c e Fin a n c ia l ma n a g e me n t a n d r e s p o n s ib il it y De s ig n Co s t s Pr o j e c t Sc h e d u l e s Re s p o n s iv e n e s s a n d f o l l o w -t h r o u g h Re l ia b il it y o f e s t ima t e s
. Qu a r l e s /j c c
/81
9
DUP050146494
PRODUCTION DIVISION Lo n g r an g e o b j e c t iv e s SAFETY - NO INJURIES COMPETITIVE COSTS SUPERIOR QUALITY AND RELIABILITY CAPACITY TO MEET ALL MARKETING OBJECTIVES MINIMUM CAPITAL COMMITMENT MOTIVATE PEOPLE TO CONTRIBUTE THEIR BEST A/20/83
DUP050146495
SOME-AREftS QE
CONTINUING AND. INCREASING EMPHASIS
SAFETY PROJECT OBJECTIVES QUALITY ASSURANCE - VENDOR PERFORMANCE AUTHORIZATION TIMING EXPENDITURES VERSUS FORECAST EQUIPMENT STANDARDIZATION LIFETIME VERSUS FIRST COST JUST IN TIME - ON-TIME DELIVERY
CCQu ar l es /c ar 10/26/83
DU P050146496
"WE HAD PUNNING SYSTEMS OF EVERY SORT FROM LONG-TERM STRATEGIC SYSTEMS TO SHORT-TERM ONES. BUT WE COULDN'T PREDICT WHAT WE WERE GOING TO SELL NEXT MONTH."*
CHARLES AMES OF RELIANCE ELECTRIC
CCQu ar l es /c ar
10/26/83.
DUP050146497
18 1983 CAPITAL MANAGEMENT - DEPARTMENTAL PROJECTS
\17 DATE OF CAPITAL \ MANAGEMENT 16 LETTER
? X 10/12/82
15 0 1/31/83
14 0 4/27/83
A 8/29/83 13
f- 10/20/83 12
11
10
9
&
8
7
I
6
I
5
I S3
4
l
3X
2
1
0 T------------- -- i---------------- 1---------------r
IQ 2Q 3Q 4Q 1983
DUP050146498
PRODUCTION R&D MARKETING ALL OTHER
TOTAL
ENGINEERING DEPARTMENT CHARGES TO COST
NINE.MONTHS 1985
(Co s t s in M$)
1981
16,848
ACTUAL_________________________
1983 YTD
1983
1282
ANNUALIZED
12.ilQN.THS
FORECAST.
12,131 4,972
281 467 17,851
9,445 4,935
512 __ All 15,303
8,598 6,237
458 __ 3A2 15,635
DESIGN EWR P&E
ESD STUDIES
ESD FIELD ENGINEERS
ERDD
BM&I AND CON STRUCTION
1281
5,327 2,454 5,774
2,526 504
. ,263 16,848
1282
6,426 2,201 5,886
2,449 570
. .519 17,851
1983 YTR ANNUALIZED
4,149 2,557 5,871
2,014 265
_MZ 15,303
CCQu ar l es /c ar 10/26/83
DUP050146499
IQfiPHERI
CCQu a r l e s /c a r
10/26/83
DU P050146500
SLIDE. 1
FRONT END LOADING
B
SLIDE.2-
ENGINEER1NG HAS CAPABILITY RESPONSIBILITY
TO BE INVOLVED IN ESTABLISHING PROJECT TECHNOLOGY
SLIDL i. TECHNOLOGY.
MUST BE SOUND MUST BE COMPETATIVE
SULDEJL
JMMl . MUST BE EARLY TO AVOID MISSED OPPORTUNITIES
I /2fe/<*2>
N 31728.03
DUP050146501
SLIDE ,5
KEY CONCEPTST
TECHNOLOGY EARLY
SLIDE,6
Fr o n t En d Lo a d in g Is :
THE APPLICATION OF ENGINEERING AND INDUSTRIAL DEPARTMENT RESOURCES DURING A PROJECT'S STUDY AND P&E STAGES TO ASSURE THAT THE BASES FOR A PROPOSED FACILITY ARE TECHNICALLY SOUND/ COST COMPETITIVE AND THAT THEY MEET PROJECT OBJECTIVES -- BEFORE DETAILED DESIGN WORK BEGINS.
SLIDE,1
ASK QUESTIONS IN THE AREAS OF:
BUSINESS TECHNOLOGY ALTERNATIVES ECONOMICS DESIGN
SLIDE 8 .
9
BENEFITS: SOUND TECHNICAL BASIS
DU P050146502
SLIDE,jLr.12.
ben ef it s : SOUND TECHNICAL BASIS OPTIMIZATION SATISFY BUSINESS NEEDS INCLUDE "STATE OF THE ART"
PRODUCT RESULTS:
LESS CHANGE LESS REWORK LOWER TOTAL PROJECT COST
SLIDE 13
RESOURCES: DESIGN CONSTRUCTION BM&I ESD ER&DD OUTSIDE
SLIDE. 1*1
FACTORS TO DECIDE WHEN TO APPLY FRONT END LOADING: BUSINESS OBJECTIVES PROBABILITY OF AUTHORIZATION DEGREE OF INNOVATION
DUP050146503
SUBEJLS
GOAL OF FRONT END LOADING: TO ESTABLISH A SOUND TECHNICAL BASIS FOR A PROJECT BY EARLY PARTICIPATION OF THE ENGINEERING DEPARTMENT WITH THE INDUSTRIAL d e p a r t me n t .
DUP050146504
CBEftlCALS Z PlfitflflS d epar t men t -
INCREASING ENGINEERING DEPARTMENT INVOLVEMENT IN PROJECTS
H. B. CLARK
10/26/83
N 31728.04
DUP050146505
R&D COMMITMENT: "INCREASE ENGINEERING DEPT, PROJECT RESPONSIBILITY"
iW&UmLja PATE o PROVEN PROJECT MANAGEMENT CAPABILITY 0 FLEXIBLE TO HANDLE SWINGS IN WORKLOAD/PRIORITIES 0 DESIGN COST EFFECTIVE
DIRECT ACCESS TO "EXPERTS" BROAD EXPERIENCE DEALING WITH MANY PLANTS NOT DISTRACTED BY PUNT SUPPORT ACTIVITIES 0 THOROUGH SAFETY ANALYSIS 0 HIGH QUALITY DESIGN CCAD) 0 TECHNOLOGY SECURE (PIP)
DUP050146506
CHEMICALS X PIGMENTS DEPARTMENT CAPITAL BUDGET
(ALL UNITS MMS EXCEPT AS NOTED)
PUftECUSVEl. 10 5-10 2-5 100MS-2 LOOMS TOTAL
IQTA.LJL&P.(1)
1983 31.0
mu 10.0(2)
5,6
m
11.5
m.s
34.1
45.5
Jii 112.8
JLA 107.8
1985 115.0<2)
8.7 46.9 JSLSL 215.7
ISSfe
5.4' 16.3 52.4 <6.2 120.3
ENGINEERING KPT, RESPONSIBILITY
PJMtaS.CC. LEffiL
1983
12S&
1985
10
31.0
10.0
115.0
5-10
5.6 - .
-
2-5
11.5
11,6
3.0
100MS-2 loom
8.-2 26,0 _iua
31.0
TOTAL
56.3
51,6
153.8
ENG6. % OF TOTAL
50
48
71 *
ENGG % OF 2WIS
12
3$
41
im
9.0 39.6
54.6 45 46
NOTES: (1> EXCLUDES NON-CONSOLIDATED SUBSIDIARIES AND CANADA. (2) NIAGARA CHLOR-ALKAU PLANT - SIOOKM (3) NEW JOHNSONVILLE DEEP WELL
DUP050146507
ENGINEERING DEPT. PROJECT HANDLING
ELAT1I.CPN.CEMS
ENGINEERING KPT. - INFLATES ESTIMATES - EXPENSIVE - UNRESPONSIVE - TAKES LONGER
PLANTS WILL BE LESS COST-EFFECTIVE WITH REDUCED PROJECT LOAD PLANT PROJECT ENGINEERS .DEMOTIVATED BV REDUCED PROJECT CHALLENGES
DUP050146508
RESOLVING PLANT CONCERNS REQUIRES
gOPP-CSMi^UgliS
INADEQUATE SCOPES/COMMUNICATIONS ARE CHIEF CAUSE OF HIGH ESTIMATES ESTABLISH FUNCTIONAL ORGANIZATIONS TO IMPROVE COMMUNICATIONS
- PROJECT COORDINATORS IN R&D - LIAISON ENGINEER ON SITE WHERE PROJECT
ACTIVITY HIGH EFFECTIVE COMMUNICATIONS
- IMPROVE RESPOND - REDUCE IN-PROCESS TIME FOR PROJECTS - CONTAIN/CONTROL COSTS KEEP SITE-LOGICAL PROJECTS AT PLANT AS BASE LOAD AND "MOTIVATOR"
DUP050146509
fcQiiCLM.Sl.QK 0 USING ENGINEERING DEPT, FOR PROJECT MANAGEKENT
IS GOOD BUSINESS 0 EFFECTIVELY USING ENGG. DEPT. REQUIRES:
- GOOD COMMUNICATIONS - FUNCTIONAL ORGANIZATIONS - ESTABLISHED PROCEDURES - COMMITMENT TO DEADLINES g BUDGETS - EXPERIENCE
DUPO50146510
77>T/f<- /&eec4sr
DUP050146511
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
A PROGRESS REPORT
t
CAB
10/26/85
N 31728.05
DUP050146512
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
DESIGNATED A RDO EFFECTIVE - AUGUST 15/ 1983
CHARTER - TO SERVE ALL C&P DEPARTMENT SITES EXCEPT DEER PARK/ LA PORTE AND BEAUMONT/ WHICH WILL CONTINUE TO BE HANDLED BY RDO-HOUSTO.N, AND BELLE/ WHICH IS ALIGNED WITH RDO-CHARLESTON. THE RDO-UP MAY SERVE OTHER DEPARTMENTS OPERATING ON SITES WHERE C&P HAS LANDLORD RESPONSIBILITIES.
CAB
10/26/83
DUP050146513
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
SITE
BURNSIDE ' CHAMBERS WORKS* CLEVELAND . DE LISLE EAST CHICAGO EDGE MOOR GRASSELLI JACKSON LAB JAMES RIVER JOHNSONVILLE MEMPHIS NEWARK NEWPORT NIAGARA FALLS REPAUNO TOLEDO WURTLAND
1984
Ca p it a l Bu d g e t
3/4Q-1983
($/M)
C&P To t a l
En g g Re s p .
575 7/895
280 3/555
0 1/501
200 200
0 6,400 3,675
400 220 525 650 180
0
160
4,200 0
710 0
861 200
0 0 0 3,675 0 0 350 200 0 0
C&P TOTALS
26,256 10,356
CHAMBERS WORKS (PPD) CHAMBERS WORKS (PD)
00 2,550 2,550
RDO-UP TOTALS * C&P RESPONSIBILITY ONLY
28,806 12/906
CAB
10/26/83
1984 Bu d g et
($/M)
C&P To t a l
0
8,470 0
5,670 525
2,360 470
4/190 1,300 7,180 4,935
505 505 5,050 610 500 150
En g g Re s p .
0
3,915 0
1,750 525 0 150
2,460 1/300
450 4,935
0 0 1,450 300
500 0
42,420 17,735
. 1,800 1,800 600 600
44,820 20/135
DUP050146514
-
SITE
BURNSIDE CHAMBERS WORKS CLEVELAND DE LISLE EAST CHICAGO EDGE MOOR GRASSELLI JACKSON LAB JAMES RIVER JOHNSONVILLE MEMPHIS NEWARK NEWPORT NIAGARA FALLS REPAUNO TOLEDO WURTLAND
C&P TOTALS
CAB 10/26/83
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
198A MCN Bu d g e t
(S/M:)
300 7,500
600 3,200 1,100 1,500 1,200 2,000
250 2,800 3,500 1,200
850 1,900 1,300
70 50
29,320
En g g r esp.
($/M)
0 1,000
0 1,000
200 100 200
0 0 0 800 0 0 200 0 0 0
3,500
DUP050146515
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
CHALLENGES 0 INCREASE THE RDO STAFF TO HANDLE THE 1984 C&P CAPITAL BUDGET 0 RETAIN RESPONSIVENESS TO C&P NEEDS o BECOME THE DESIGN GROUP OF CHOICE
CAB 10/26/83
DUP050146516
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
FORCE FORECAST
DU PONT
11/1/83
ENGINEERS DESIGNERS
DU PONT SUB-TOTAL
13 3
--
16
ALLSTATES
ENGINEERS DESIGNERS
6 20
ALLSTATES SUB-TOTAL 26
1/1/84
14 4
--
18
14 26
40
6/1/84
14 4
18
12/1/84
14 4
- --
18
20 24 37 40
i--------
57
64
OFFICE TOTAL
m
58 75 82
CAB 10/26/83
DUP050146517
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
WORK LOAD
Pr o j e c t Au t h o r iz a t io n s
$M
1980 1981 1982 1985
S,OOOM MOOM 7/ZOOM 2/230M (THRU 8/51)
Th e C&P Ca p it a l Man ag emen t Repo r t f o r 2085 in c l u d ed pr o j ec t s t o t a l in g $4,400M w it h RDO-UP r e s p o n s ib il it y .
CAB
10/26/85
DUP050146518
REGIONAL DESIGN OFFICE UNIVERSITY PLAZA
FORCE FORECAST IS BASED ON: 0 $30,00011 CAPITAL BUDGET 0 FAIRLY EVEN DISTRIBUTION OF AUTHORIZATIONS
If t h e t o t a l a mo u n t o f w o r k in c r e a s e s o r s l ip s t o p e a k , w e ma y b e UNABLE TO STAFF PROPERLY OR BE AS RESPONSIVE AS YOU DESIRE.
CAB 10/26/83
DUP050146519
PROJECT CRITIQUES PREPAREHJY.C&P.
PROJECT 5654 - DEER PARK
- SYNTHESIS GAS FACILITY
PROJECT 5653 - PEER PARK
- METHANOL PLANT NO, 3
PROJECT 2663 - DE LISLE
- 150,000 TONS/YEAR TITANIUM DIOXIDE FACILITY
PROJECT 8412 - DEER PARK
- METHANOL TERMINAL
PROJECT 2586 - CHAMBERS WORKS -EXPANDED FACILITIES FORPHTHALOYL CHLORIDE
PROJECT 9083 - MEMPHIS
- MEMPHIS HYDROGEN PLANT
PROJECT 8401 - DORDRECHT
- MANUFACTURING FACILITIES FOR "TERACOL" POLYETHER GLYCOL (50%)
PROJECT 7465 - BEAUMONT
- METHANOL MODERNIZATION (99%)
CCQu ar l es /c ar 10/26/83
N 31728.06
DUP050146520
PROJECT CRITIQUES D.EL-B
QBJCtIV TO ASSIST OTHERS WHO HAVE SUBSEQUENT PROJECTS
WHEN REQUIRE]! MOST PROJECTS OVER $4MM AND FOR SMALLER PROJECTS DESIGNATED BY DEO
ORGANIZATION. FIVE SECTIONS SUMMARY OPERATIONAL DESIGN CONSTRUCTION COST CONTROL
CCQu ar l es /c ar 10/26/83
DUP050146521
PROJECT CRITIQUES
CONTENT . METHODOLOGY USE COST
CCQu ar l es /c ar 10/26/83
DUP050146522
PLANT Beau mo n t
QUALITY CONTROL PERFORMANCE & VENDOR RELATION
VENDOR
PROBLEM
Wil s o n
Deh y d r at o r Co l u mn Tr ay s
Wo r t h in g t o n
Tu r b in es & Co mpr es s o r s (1970)
Mit s u i
Co mpr es s o r (1983) Reac t o r Fa b r ic a t io n
Fo s t e r -Wh eel er
Ref o r mer Air Pr eh eat Sy s t em Fu r n ac e He a t Bal an c e Pu r g e Gas Bu r n er Ca p ac it y
. Pig t a il Heat Sh ie l d s
LURGl
Reac t o r Tu be Su ppo r t s
Ch amber s Wk s St o n e & Webs t er B&W
Ret u r n t o Co al Pr o j ec t Man ag emen t
Co al Pu l v e r iz e r s - Bo il er Per f o r man c e
Deer Par k
Va r io u s Mit s u i Ric -Wil St e in mu l l e r
St u b-en d s Co mpr es s o r Ac e t ic Ac id Lin e Wa s t e Heat Bo il e r
HJSt r an s k y 10/25/83
/
N 31728.07
DU P050146523
QUALITY CONTROL PERFORMANCE & VENDOR RELATION
PLANT
VENDOR
PROBLEM
De e r Pa r k
Lin d e /Lo t ep r o
mo l Sie v e Ve s s e l s r e c t i s o l CTX He a t Tr e a t me n t Ca r b o n y l s Co l d Bo x Re l ie f Va l v e
Te x a c o
Va r io u s
Co mb u s t io n En g .
Bo il e r
De Lis l e
Da r t Amit e k Wil l ia ms Wil mo n t -Fl e min g
?
Pr e s s u r e Fil t e r s - Pl a t e s Wa s t e Fil t e r s - Ru b b e r l in in g Fl a s h Dr y e r Ha mme r mil l Sp r a y Co n d e n s e r Dis c s - w e l d s St r ip p in g Sc r e w - We l d s Pu mp Ta n k No z z l e Fl a n g e s
Jo h n s o n v il l e Fu l l e r
Va r io u s
En g in e e r in g De s ig n Co n t r a c t o r s
Or e Ro a s t e r
Do r d r e c h t , d e e r Pa r k me t h a n o l , Ca r l in Ne v a d a , Ch a mb er s Wo r k s Co a l , De e r Pa r k s y n g a s , Me mp h is Hy d r o g e n
HJSt r a n s k y
10/25/83
DUP050146524
QUALITY CONTROL PERFORMANCE AND VENDOR RELATIONS
PANEL:
J. P. MURPHY - DESIGN VIEWPOINT J. P. MC FADDEN - M&L PERSPECTIVE R. H. DUNLAP - LEGAL
Summary Notes of Comments
Murphy - We let vendors off the hook, Du Pont steps In to solve problems. Lack of response by vendors In timely manner. We can't afford zero defects not practical. Equipment deficiencies result from servers! sources and compromises such as specification quality, delivery time, price, etc. Every vendor, including those emphasizing quality have at some time failed our*expectations. Quality being attained may already be cost effective.
McFadden - Obtain performance by qualifying vendors, use bidders list .and place on selected basis. Disclaimer for consequential damages is industry policy. M&L doesn't accept letting vendor off the hook. In most cases pursued, we have recovered some back charges. Need timely feedback from plants to pursue. Doubt we can afford a risk-free contract. Have to give vendor first opportunity to solve problem (pressure of time forces Du Pont in before vendor solves or we don't like vendor's proposed solution).
Dunlap - Lot of money wasted by plant wanting Specific item instead of considering alternatives. Have been pursuing claims. Expect increased emphasis on claims and litigation. List of outstanding claims being developed for more awareness. Usually exclude consequential damages but more tendency to pursue or set practical limit which will increase emphasis desired. Approval of drawings often weakens case in spite of what stamp says trying to limit approval. About $14MM in claims outstanding. Claim awareness will increase recovery. Plants need to be aware of opportunities needing follow-up and challenge vendor. (Legal planning presentation to plants.) Adequacy of guarantees, etc. should be worked out ahead of time and if possibility of claim is poor vs risk, then Industrial Department should be
aware. Use terms and conditions as part of the acceptan0 ce criteria.
Discussion - Claims should produce incentive for vendors and others to do better job -- emphasis to avoid problem from starting. All deficiencies are not vendor performance. Objective is not to have a problem in first place.
N 31728.08
DU P050146525