At the Construction Intel Summit KSA, Wees Abraham, VP of SHADE, offered essential insights into the challenges of financial management and commodity procurement in giga-projects. His discussion focused on the importance of strategic financial planning and proactive commodity management from the client's perspective, crucial for the efficiency and success of these large-scale endeavors.
Strategic Financing and Supply Chain Management 🔄
He highlighted the importance of robust financing, he underscored the need for larger advance payments – ideally between 15 to 20 percent, as opposed to the standard 5 percent – to ensure seamless project continuity and reduce the risk of delays. Regular and consistent payments to contractors are also essential, as they maintain steady cash flow and progress. Additionally, he advocated for a strategic approach to procurement milestones, suggesting multiple milestones for each procurement item to foster a more adaptable and responsive supply chain. He pointed to the oil and gas sector, such as the Aramco payment plan, as having perfected the supply chain model with timely payments and multiple payments per milestone.
Strategic Commodity Management and the Importance of Localization 🌍
He emphasized strategic commodity management as a key factor in giga-projects, stressing the need for clients to take a proactive role in sourcing materials. This approach helps control costs and avoid potential delays. Partnering with local manufacturers, he noted, reduces environmental impact and supports the local economy, thereby streamlining the supply chain and aligning with sustainable construction goals.
Predictive Market Analysis with Tech and AI 🌐
Discussing the integration of technology and AI, he explained how these tools offer predictive insights into market trends and supply-demand dynamics. Their use in material selection and market analysis enables project leaders to ensure material availability and project efficiency.
In his contributions at the Construction Intel Summit KSA, Wees underscored the crucial role of proper financing and advanced planning for commodity management in giga-projects. His insights on strategic financing, combined with proactive resource management and technology integration, illuminate an effective approach for the success of large-scale projects.