Customer Profile: Linde
Worldwide Engineering Organization Adopts and Implements Cost Estimating Solution to Increase Predictability and Reduce Costs
Through up-front investment in expert implementation support, Linde process plant engineering evolved their estimating discipline away from an assemblage of multiple legacy tools to a modern, more streamlined, approach for better efficiency and more consistency during the cost estimating workflow to yield sustainable long term cost savings.
As one of the leading global producers of industrial gases, with an associated world-class engineering organization, Linde has been a constant leader with a presence in around 100 countries with almost 52,000 employees. Linde is committed to technologies and products that unite the goals of customer value and sustainable development. Linde’s™ USA engineering organization was challenged with high estimating variances, cost overruns, and a large multi-staffed cost estimating team. An internal analysis diagnosed the problem as an inconsistent use of tools with a complex cost estimating workflow.
With the estimating variability identified as a strategic need, Linde (USA) turned to Aspen Capital Cost Estimator (ACCE) as a software solution and to Strategic Estimating Systems (SES) as the implementation experts. ACCE not only allows them to complete the cost estimate faster and with greater accuracy, but as a comprehensive commercial tool, it allowed Linde to phase out legacy tools and create a more powerful and flexible approach to economic evaluation and analysis.
- More Accurate
- More Efficient
- More Consistent
- Increased Speed
- Facilitate Repeat Processes
- Generate Full Cost Estimates With Location and Capacity adjustments Simplified (Not Factored)
Aspen Capital Cost Estimator Chosen By LINDE As Best-In-Class Cost Estimating Software
Replacement of a Complex Workflow
This complex work process caused considerable inconsistencies into how cost es-timates were developed from one project to another. A key advantage of using this new approach would be the ability to replace a fairly complex workflow, involving an assemblage of multiple proprietary tools and many manual handovers of infor-mation, into a streamlined process for greater consistency, especially during repeat cost estimates for different accuracy levels, multiple phases, or capacity and loca-tion adjustments.
Unique Strengths for Industrial Gases
For Linde, one of the attractions of this approach was the unique strength provided by the combination of the Aspen Capital Cost Estimator software and the strong experience Strategic Estimating Systems (SES) has using ACCE. Also, SES has particular skill and familiarity in the cost estimation of these types of capital pro-jects, including unique knowledge of building estimating models for cold boxes.
Calibrate Model and Estimate Linde Specific Processes
To calibrate Aspen Capital Cost Estimator to Linde, recently constructed plants were fully modeled using the new workflow approach. To achieve this, several custom models were built into the software, including hydrogen processes, gas processing, air separation units, sulphur removal and recovery systems. Each of these models was shown to reproduce cost estimates within a very close range of actual installed capital costs. A key contributor to the success of this effort was the expertise of the estimating consultants, Strategic Estimating Systems, who were able to rapidly build the process specific models as well as calibrate the new soft-ware to capture historical data of capital projects. Linde-specific design specifica-tions were loaded into the system as parameters. The new cost estimating work-flow successfully matched the historical data, with an overall reduced variability, eliminated the need for an assemblage of multiple proprietary tools and eliminating significant manhours required to produce a cost estimate.
Full Scale Implementation
Following the implementation phase, in which Linde estimators shadowed SES experts in the use of the system, the Linde team used the new approach on two hydrogen plant proposals, testing both the technical and work process aspects of the approach. Next, ACCE was run in parallel with Linde legacy systems to build confidence in the approach. Some final adjustments were made to fine tune the cost models to further match Linde practices. All of those activities proved suc-cessful, and Linde is now in full implementation, implementing the work process changes to eliminate multiple legacy tools and using about half of the manhours per cost estimate. Linde is now fully engaged in building confidence in the system with management, clients, the estimating community, and discipline engineers. This project has overcome barriers of existing workflows and resistance to change.