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New Work in Engineering Business Re-Thinking EPC Business Models
Say goodbye to the Lump-Sum-Turnkey-Project: Engineering of the future has to be networked, cooperative and transparent — The necessity to re-think the way EPC companies do business in the digital age is one of the key findings of a recent benchmark study. This requires a completely new work from technology-loving plant engineers. The hunt for new ideas and competent minds is in full swing...
Rethinking plant engineering: Currently, technology-oriented business models are a mainstay for EPC companies — but digital and data-driven services are on the rise. By 2025, these new-model projects are expected to triple their market share, according to a benchmark study by the German industry association VDMA's plant engineerings workgroup (AGAB) in cooperation with the consulting firm PWC. According to the study's findings, technology enabled business models, which dominate the market today with a share of around 60 percent, will lose considerably in importance by 2025. By contrast, digital, data-driven services (“open digital”) will more than triple their market share by 2025. As a result, engineers need to rethink the way they handle large construction projects, Dr. Hannes Storch, member of Outotec's management and deputy spokesman for AGAB, states: “In this changing environment, skills such as agility and flexibility are becoming increasingly important.”
Large-scale plant construction companies have to adapt quickly to the changing market situation and the new customer requirements. Based on a digital reference model, the study has identified 18 specific capabilities for large-scale plant construction that are necessary to fully exploit the market potential in 2025. These include, for example, knowledge of change management and agile project management methods, the promotion of business incubators and the development of intelligent logistics concepts which help to optimize construction site processes.