IPENZ Engineers New Zealand

HOME > publications > engineering-NZ > volume53-1998 > 1998-05-may > FOOD&BIO

Back to Publications

New Zealand Engineering 1998 May

Confessions of a Shifty Shopper

Ian Marsden is a food industry project engineer, Christchurch

We are all familiar with budget constraints, the "death of a thousand cuts" torture of whittling down project dreams to the size of disturbed catnaps. But should cost cutting be a sporadic martyrdom? Or a regular, healthy habit?

I have learned never to take for granted that cost and quality are related, it is all too possible to pay plenty and end up with diddley squat. There are ways to routinely shave healthy chunks of cost off process engineering project work, and paradoxically, to get a better quality job at the same time. Allow me to share a few that work for me.

Cost minimising begins at the process design stage, where haste and narrow mindedness add more and more to the scope of the project, whereas careful lateral thinking can shorten the proposed plant list, and with it the cost. Make a flow chart, with all of the proposed, necessary process functions listed. Can a shotgun marriage of some of these functions eliminate a machine or two? Say we want to spread product evenly to feed into the next machine, drain surplus water, cool the product and add sugar. Could this be done on a single vibrating pan conveyor, if fitted with a draining screen, cooling fans and a recirculating sugar solution spray? The combinations and permutations are endless and process rationalising is more an art than a science, but time spent is repaid a hundredfold. Often by considering alternatives, whole processes can be eliminated. The more the process is rationalised and pruned of dead wood, the less it costs and the more tidy and reliable it becomes.

Second hand

Only consider the use of second hand plant to reduce cost, towards the end of this analysis; sometimes there are real savings to be made, but often you will realise that you are trying to fit a square peg into a black hole. If the machine doesn't belong, then you are buying a bargain at any cost; take the G clamp off your wallet and buy the right thing instead.

Implementing the project, there is more fat to trim, but you must understand the anatomy of costs before attempting to slaughter them. The vital organs are design, materials, labour, capital equipment and other overheads. It is important to shop for these at the most appropriate places, to get the lowest prices.

Cost of materials comes back directly to your design choices, and to how much effort you put into shopping around first. There are a lot of surprises out there in inventory land and it doesn't pay to make presumptions. I wanted to make a mezzanine of stainless steel, but it's so shockingly expensive that large structural sections are not available. After agonising over home-made RHS and thin skin tube designs filled with concrete, I finally bit the bullet and shopped around for heavy wall pipe. Imagine my surprise to be able to buy 8" and 10" pipe cheaper than smaller thin walled tube! Prices also vary widely for the same thing between suppliers, with no apparent pattern, due to old stocks and differing import sources. Window shopping is time well spent.

Feeding dinosaurs
Next, consider your executioners. Companies are constructed like pyramids, the bigger they are, the more equipment and expertise they have, but the heavier the weight of overheads being loaded onto the bottom layer of workers executing your job. By carving work into smaller slices it can be executed by smaller players, without the overheads, often at less than half the price. If work is handed out in large chunks, only dinosaurs can chew them. Another cautionary note, sometimes large pyramid companies with little competition, have mummified their technology.

Does all this extra effort deliver, in practice?

A recent project needed two tonnes per hour of scarifying capacity, only achievable "off the shelf" with two $32,000, standard imported one tonne machines, with the process line split at further cost to fit them in parallel. Designing a purpose made double capacity machine and tendering to local manufacturers, avoided the messy split and did the whole job for $25,000, saving over $60,000.

Sometimes you must have that specialist large company expertise, you should never tackle anything where there are gaping holes in your knowledge. Amateurs should never try designing a steam boiler or a helicopter. But to minimise the high cost, surgically remove only the work requiring the expertise that you don't have, and issue competitive tenders. Get help if necessary to prepare a good, definitive tender specification, this work is too expensive to risk errors and omissions.

Now, what do you do with the rest of the project? We are not talking about a few mangy leftover odd jobs, this portion should typically account for two thirds of the total budget. Every project has pipework, pumps, platforms, conveyors, tanks, wiring, drains and a host of other ho-hum bog standard engineering work to hold the beast together. If you want to toss all this to the ravenous pack of smaller hyenas to pick over, there is a problem. They have no overheads, and that means that they have little design or site management capability, so you have to fill the vacuum.

What and how much design and supervision work you tackle yourself will depend on your own talents, but assuming that you need help, apply the same pyramid principle again. Jobs needing specialist expertise outside your own talents and resources, can be handed to consultants, shop around and consider smaller players with sharper biros. Handle jobs in your own sphere of expertise economically by pulling talent in rather than farming work out.

Contract draftspersons can extend your own design horsepower at least fourfold, they have few overheads and cost little compared to off site consultant's staff. If you have inadequate office space, perhaps you can hire a portacom hut? When you have too much work to manage this way, or lack personal design skills, the next line of reinforcement is to second in an engineer or two as well.

This approach keeps overheads down, keeps the work and information in one place where you can directly supervise and makes it easier for the team to interact with each other and the site. It is also easier in this environment to eliminate the gold plating from the design process itself. Work should only be "appropriate" for the need.

You don't need elaborate CAD drawings to order a plain round tank, or to tell a tradesman where to drill a hole. The pen is mightier than the mouse, a rough freehand sketch may take two minutes and get the job under way pronto, where using a consultant's draftsperson in a distant office might lose you a day and add a hundred dollars to the job. At the end of any project, typically half of the drawings will be of no further use and can be trashed, so why not short circuit the process a little?

The moral to the story is to study the project's anatomy and cut only fat, not muscle and bone. Any idiot can kill and butcher a budget, but the result is a bloody mess. Truly cost effective projects have the best of all they need and nothing more, and look expensive, but aren't. Is your project a lean, mean, fighting machine? Or a malnourished, nasty piece of work?