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PIP: Working in Harmony to Change Industry pip

PIP: Working in Harmony to Change Industry www.pip.org. Steve Franke Shell Chemical Company Process Industry Practices. 2000 CII Annual Conference Nashville, Tennessee. Objectives. Broaden understanding of PIP initiative. Raise awareness of PIP “value proposition.”

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PIP: Working in Harmony to Change Industry pip

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  1. PIP: Working in Harmony to Change Industrywww.pip.org Steve Franke Shell Chemical Company Process Industry Practices 2000 CII Annual Conference Nashville, Tennessee

  2. Objectives • Broaden understanding of PIP initiative. • Raise awareness of PIP “value proposition.” • Validate PIP harmonization process. • Publicize spin-off opportunities for harmonization process. • Relate PIP readiness and electronic availability. • Advocate use of PIP “best practices.”

  3. A Ladder Is A Ladder?

  4. Vision • PIP is “universal language” in U.S. process industry for EPC industry practices. • PIPs are widely recognized and available electronically. • PIPs are up to date, of high quality, and can be used “essentially as is.” • A preponderance of owner and contractor companies voluntarily adopt and use PIPs.

  5. Mission • Increase EPC work process value globally. • Enhance compliance with safety, health, and environmental objectives. • Have PIP represent preponderance of industry. • Create and use EPC “industry practices” (PIPs). • Establish IT collaborative and distribution tools to facilitate PIP development and usage.

  6. PIP Member Consortium • Chartered in 1993 and affiliated with CII. • 33 U.S. process industry companies (24 owners; nine EPC contractors)

  7. PIP Member Consortium PIP Members’ U.S. Market Share (Revenue) Category2000 2002 goal Owners 50+% 70-75% EPC Contractors 70+% 75-80%

  8. PIP Value Proposition Objective Perform an engineering-style estimate in order to quantify the value of PIP.

  9. Value Proposition Study Approach • Base estimate on actual EPC project. • Use study team of experienced owner, contractor, and supplier members. • Estimate standardization impact. • Focus on work process impact (before and after).

  10. PIP: Where Is the Value? • More efficient communication with EPC. • Reduced specifications conflicts and errors; less rework and redesign. • Reduced inspection and testing. • Improved automation and productivity of engineering, construction, fabrication. • Reduced standards maintenance and training. • Reduced materials and equipment inventories.

  11. PIP Value Proposition Study Results Value Potential 6.7 percent (Greater than $1.3 billion annually for U.S. process industry)

  12. Company A Engineering Standards PIP Practices Company B Engineering Standards Company C Engineering Standards Harmonizing Adopting

  13. CII Research PIP Harmonization Data Collection Literature and Existing Company Case Studies Standards Data Analysis Define Causal Define Similarities Relationships and Differences Model Development Rigorous — Align Similarities Statistical and Harmonize Differences Model Test Industry Survey Industry “Experts” Review Model Application CII Best Practice PIP Industry Practice Research vs. Harmonization

  14. Standards and Practices:Typical Costs and Timing Creation Costs Creation Time ($M/guide) (months/guide) Standards Development 500-70030-42 Organizations PIP 370-50022-30 Organizations

  15. Practices Published Through June 2000 600 EXPECTED TOTAL 500 400 CRITICAL MASS Number of Practices 300 200 100 0 ‘95 ‘96 ‘97 ‘98 ‘99 ‘00 ‘01 estimates

  16. Practices by Discipline Number of Practices

  17. PIP Usage:Sample Owner Company 140 120 100 80 60 40 20 0 115 PIPs 56 47 12 1998 $31MM 1999 $496MM 2000 $120MM 2001 $436MM

  18. API • Pump Installation • Welding • Mechanical Seals ASME • Pump Data Sheets • Specialty Vessels/Bins ISA • P&IDs (Process & Instrumentation Diagrams) PIP Impact:Collaborative and Joint Efforts

  19. PIP Impact: Industry “Voice” • Successfully petitioned exceptions for industrial equipment platforms from international group. • Led Owner Operator Forum-FIATECH alignment. • Actively interfacing with other industry groups.

  20. PIP Impact: Future Potential • Harmonize EPC industry practices for related industries. • Provide input to industry on standards and code development. • Guide technology development and application. • Help globalization of EPC industry practices. • Other HARMONIZATION opportunities?

  21. To Learn More About PIP • Visit Product Display in Conference Center. • Meet PIP representatives. • See demo of PIP Web site. • See sample PIPs. • Get “Overview” and “Value Proposition” papers. • Visit PIP Web site (www.pip.org). • Attend PIP workshop at CPI Conference.

  22. PIP & Harmonization “Over 330 Best Practices and Still Growing” www.pip.org

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