Study of Acergy`s supplier database

Master's thesis in Offshore technologyAcergy Norway AS is a seabed-to-surface engineering and construction company for the offshore oil and gas industry worldwide. They deliver services in many market segments such as Inspection and Maintenance and Repair (IMR), Conventional Field Development, Subsea Umbilical Risers, Flowlines (SURF) and Trunklines. Acergy use a fleet of highly adaptable ships and a range of additional services. To be able to deliver these services Acergy is dependent on a great number of sub suppliers. A consequence of cooperating with so many suppliers is that one get a vast amount of information that needs to be systemised. Acergy need a system where one can exclude poor suppliers and make it easy to find good suppliers that they know are capable of delivering their services/commodities with the right quality and on time. To optimize the use of their suppliers and with the previous in mind, Acergy has developed a supplier database where information of their supplier’s performance, frame agreements, cost savings, and performance assessments are stored. This information is used in various situations such as buying processes for standard products, buying processes for non standard products and in the supplier management processes. The purpose of this thesis is to study the existing supplier database in Acergy in relation to the management of suppliers, in addition to identifying potential improvements. An examination of the official procedures, the software system and a literature study on the different relevant issues has been performed. In addition to this there have been interviews with company employees. Even though the supplier database has been developed and is functioning, there is a challenge to optimize the use of the database, in order to inform of it and the use of it. In this paper it is concluded that the training and information of the supplier database in Acergy is insufficient and should be improved. Increased globalization and communications facilities have in the later years again increased the suppliers possibilities to take part in multinational tendering processes. However, this has given new challenges for buyers, who now have a great number of suppliers to choose from in some product groups. It is therefore further important for the buyers to choose the right collaborating supplier, in order to optimise the supply chain management process. For a company like Acergy to get the lowest price is not necessarily the most important, but more quality and delivery. Should a project be delayed or have to be redo part of the work, this will mean a great extra costs for the company. These costs will most likely exceed the cost savings connected to the choice of the supplier with the lowest price, if this product shows to have poor quality. This brings to light the importance of building good relationships with the suppliers and use effort in development in these relations. In respect to this Acergy has established an independent unit to manage the supplier relations. However the output of this paper recommends an extension of this unit to increase the communication with the most critical suppliers. ..