Subcontract Management and Subcontractor Oversight

1. Subcontract Management and Subcontractor Oversight Susan Kimmerly Bechtel Jacobs Company LLC November 18, 2004

2. Subcontract Management • Tri-Party Team • Subcontractor performance indicator (“scorecard”) P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

3. Subcontract Management • Tri-Party Team (core team for day-to-day subcontract management) • Subcontract Coordinator (SCC) • ESH Representative • Subcontract Administrator (SCA) P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

4. ESH Representative Oversight - Tri-Party Team SCC SCA Subcontract Management P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

5. Subcontract Management • Subcontractor performance indicator (“scorecard”) • Purpose: • Evaluate and rate subcontractor performance monthly • Communicate performance to MOP/FM and to subcontractor lead line management and key personnel • Lessons Learned and feedback • Supports decisions to exercise or not exercise subcontract option periods or terminations • Supports decisions for Performance Incentive Extensions • Applies to all subcontracts > $1M P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

6. Subcontract Management • Performance scored monthly by SCC, ESH Rep, SCA, and others as necessary • System uses information from routine walkdown and reporting processes • Criteria includes subjective and objective assessments (green, yellow, red rating) P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

7. Subcontract Management Typical Scorecard Criteria • Environment, Safety and Health • Scope of work (SCC determines specifics) • Rigor of Operations • Assessments • Commercial P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

8. Subcontract Management • Corrective action required if a rating is red or yellow • Rating becomes green after corrective action is completed • If subcontractor performance is unacceptable, the appropriate line manager takes corrective action • Each subcontract assessed on its own merits P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

9. Subcontract Management “Scorecard” Summary • Process is an important element of feedback and improvement • Driven by daily interaction between BJC and Subcontractor • Provides monthly assessment of performance • Provides basis for constructive criticism and praise • Isolates areas of weakness for concentrated focus • Supports option exercise decisions • Supports effective subcontract management P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

10. Subcontract Management • Tri-Party Team (Core team for day-to-day subcontract management) • Subcontract Coordinator (SCC) • ESH Representative • Subcontract Administrator (SCA) P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

11. SCC Execution / Oversight SCC Program is managed by the Field Services organization Individual(s) assigned to specific subcontracts who are responsible for ensuring that subcontractor performance meets subcontract terms and conditions Single BJC point of contact for the subcontractors P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

12. SCC Execution / Oversight Premobilization submittals Notice to Proceed Readiness Evaluations Ongoing submittals review and status Ongoing execution team oversight P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

13. SCC Execution / Oversight Management Assessments Independent Assessments Closure Project Evaluations DOE Facility Representative oversight Daily SCC/SA oversight, integration and reporting P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

14. SCC Execution / Oversight SCC Progress Reports ESH Representative Walkdown Reports Subcontractor Self Assessments Subcontractor Performance Evaluation P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

15. ESH Representative Execution / Oversight Single point of contact for ES&H Reviews subcontractor ES&H submittals Mentors subcontractors in ISMS implementation and Zero Accident Performance Performs oversight of subcontractor ES&H activities Tracks subcontractor ES&H performance P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

16. ESH Representative Execution / Oversight Perform daily walkdown of subcontractor work activities Perform joint safety audits with SCC and subcontractor Ensures compliance with subcontract ES&H requirements Foster implementation of BJC ES&H programs Review subcontractor generated ES&H data Support SCC in conducting subcontractor investigations P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

17. ESH Representative Execution / Oversight Provides lessons learned information to subcontractor Interfaces with other ES&H SMEs to support Project initiatives Coach subcontractor in developing and implementing corrective actions resulting from audits and self assessments P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

18. SCA Execution / Oversight Assure subcontractor submits ES&H Program Identify and evaluate violations Prepare notices to subcontractor Sign / approve violation notices to subcontractors Transmit notices to subcontractors P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

19. SCA Execution / Oversight Approve subcontractor corrective actions and/or provide direction Monitor close-out of quality issues Chair progress review meetings Assess subcontractor performance (monthly subcontractor scorecard) Obtain hazardous materials and waste list from subcontractor P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al

20. Subcontract Management and Oversight Effective Subcontract Management and Oversight is a team effort and and is critical for ensuring and / or improving subcontractor safety. P:BJCMgmt/wfs/Bechtel_SAIC_Contracting Pres_Massey et al