The ABCs of EPC

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This in-depth look at the Saulsbury Industries supply chain offers best practices for EPC sector leadership

Since 1967, Saulsbury Industries has been plugged in to the needs of heavy industry players. The Odessa, Texas-based engineering, procurement, and construction (EPC) contractor is known for its safety record and fast turnarounds, two critical and often contradictory aspects of project management.

Founded by C.R. “Dick” Saulsbury as an electrical services contractor, the family-owned company quickly gained a reputation for integrity and quality work. In 1980 Saulsbury launched Saulcon, the firm’s construction division, and became the only organization in the Permian Basin capable of providing a complete suite of construction services, including general construction, engineering, as well as electrical and instrumentation.

The Saulsbury family launched Saulsbury Engineering and Construction in the mid-’90s after recognizing a need to diversify its services to become a full-service, multi-industry organization. In 2012, the three companies merged into one to form Saulsbury Industries. Today, the company serves clients in a range of markets and industries, including upstream, midstream, and downstream oil and gas, and other heavy industrial enterprises without ever losing the core values instilled from Dick since day one.

“We have strong ties to our core values and work every day to maintain those values. We have been in business over 52 years and have adapted our business to meet ever-changing market conditions and today are stronger than ever,” reported Kyle Tynsky, Saulsbury’s senior director of supply chain.  “Saulsbury truly is a family atmosphere without walls built between divisions. And all areas of the business work together to provide the best outcome for our customers, employees, suppliers, and Saulsbury.”

BOSS Magazine recently connected with Tynsky to get an intimate look at the firm’s transformation of its supply chain, and the value lessons that may benefit other contractors not just in the EPC sector, but others as well.

A well-managed supply chain is a significant competitive advantage when cycle times are a paramount concern. To that end, the company has built a fit-for-purpose chain. As Tynsky put it, a great SCM “(A)llows us to provide our customers with a quality product in an accelerated timeframe, while always maintaining our commitment to safety. Our advantage is our focus on speed-to-market, which means our projects are online and operational quickly and efficiently, which makes our customers more profitable and successful.”

The scope of Saulsbury’s supply chain encompasses everything a successful EPC organization needs to respond to customer demands, including all material procurement for project sites, all subcontracts for the company, as well as all field and back office documentation, supplies, and equipment.  All of their service areas — engineering, construction, fabrication, and field services — are served by the same supply chain.

After assuming his role, Tynsky’s first step was to identify synergies within the departmental organizational chart and reorganizing appropriately. “Many of our employees were working directly on project sites and had day-to-day knowledge of what was needed in the field, so one of the first orders of business was to transfer some employees to the operations group, under the direction of the project team. This allowed a closer relationship and better communication lines between the project teams and the corporate supply chain group.

“The men and women with boots on the ground are really the ones that know what they need and how quickly they need it to maximize production in the field. This simple strategy allowed a much more fit-for-purpose supply chain; operations has the control of expediting materials to the site when they are needed rather than waiting to go through a cumbersome supply chain process, keeping the operations teams productive rather than waiting on material.”

Today, the supply chain team is comprised of 14 full-time employees. “(T)hat is a bit deceptive, as we have many experienced supply chain personnel included within operations allowing us to work as a cross-functional team rather than a single department. It takes a village to be successful in this market. Additionally, I have great managers and leads within my team that have been employed with the company for a number of years that are able to keep the wheels moving in any instance and have great instincts on how to react to adverse situations,” he clarified.

“The second order of business was to change our policies and procedures throughout all areas of supply chain. With the operations teams in more control of their material and expediting, along with local relationships with vendors and suppliers, we moved quoting of materials to individual project teams and purchase orders and subcontracts being completed within supply chain, again allowing a more focused supply chain group.”

Tynsky then replaced the existing field purchase order protocol with a P-card program for the operations team, giving them the ability to get material shorts, consumables, and quick turnaround materials, as needed and quickly. To make the Saulsbury supply chain as fit-for-purpose as possible, the company also rethought its engineered equipment purchasing routine and subcontracts.

“The project team knows exactly what they need in terms of subcontracts and when they need them on site. Operations completes the request for request for quote (RFQ) package for subcontracts, while the engineering team completes the RFQ package for engineered equipment. Once those are complete, supply chain buyers work with our vendors, develop the bid tab, and collaborate with their respective teams to award the subcontracts and engineered equipment purchases. Not only do we have several people looking at all of our contracts, but more importantly, we have the right people making the final call.”

Some members from AP joined supply chain to form a new hybrid group to ensure purchase order efficiency and invoice accuracy. As Tynsky noted, the move “has drastically reduced the number of backlog POs and allowed quicker payments to vendors and allowed us to provide faster lien waivers to our customers.

“Once the hybrid team was implemented, we immediately began working on national agreements with our vendors and subcontractors to negotiate national pricing to eliminate a lot of individual project bidding time and strengthen relationships with our suppliers.

“We have done all of this to ensure our customers are receiving the most bang for their buck while we can maintain our company advantage of being able to deliver projects to completion much faster than the competition.

“I wanted to maintain the best of the best within our supply chain and I have been fortunate to have a great team backing me, led by our procurement and subcontracts managers. We have maintained our mission to work as closely with our suppliers, operations, and other company support teams to maintain a synergy throughout the company where we are all here to ensure the company’s success,” he stressed.

The power of meaningful change

The inclusion of operations and engineering in some of the typical supply chain duties enables Saulsbury to hit the ground running with the right equipment and materials at precisely the right time to deliver their projects safely, on time, and with the highest quality standards.

“The most meaningful change in supply chain has been to consolidate the group into a single location where everyone is able to assist each other, cross-train, and function as a solid team, everyone follows the same practices and are always there to help out, allowing us to stay in front of the project teams,” he continued.

Saulsbury’s supplier and vendor partners are thoroughly screened to ensure they can deliver as promised and are measured through a lens of the company’s core values of safety, integrity, excellence, relationships, and community. “We utilize companies with strong safety backgrounds, as that is the most important core value we have, which shows in our safety record in being recognized as one of America’s safest companies.

“We want our vendors to act with integrity and do what is right in order to make our projects a success for everyone involved. When it comes to excellence, our vendors must offer quality products and stand by their work and their word. We have worked hard over the course of many years to develop relationships with everyone we do business with. We expect our suppliers to answer the call when we need them most and we will do the same in return. And we try to utilize local businesses as much as possible to develop strong bonds within the communities where we operate,” he said.

“Our strong supply chain partnerships allow us to obtain goods where others may not be able to or to provide alternative solutions to our customers through the experience and knowledge of our suppliers. We don’t take our partnerships lightly, as we view them as an extension of us directly. I want our suppliers to feel they have a strong enough relationship to call us when they see an issue or point out if there is a more favorable alternative to provide the best end-product to our customers.  We strive to ensure our suppliers are successful in their business so they may grow along with Saulsbury and maintain the partnerships for many more years to come.”

Powered by expertise and supported by unshakeable values, Saulsbury has built a reputation for service matched by few. Tynsky spoke of another key quality that sets them apart: the strength of a family-owned operation.

“Saulsbury is a family-owned business that has been together for over 52 years with steady growth into what it is today. Even though the number of employees and revenue has grown with Saulsbury, there is still a strong sense of family with the group where everyone is there to help and find solutions to work through problems as efficiently as possible,” he said.

“The fact that the business has been built to its strengths and established fit-for-purpose groups within the company make for an outstanding place to work, one where you can do your job without fighting through a lot of red tape to get the project done. The main goal is to provide a best in class service to our customers that can provide an operational plant or project in a time frame that others say can’t be done. We have never been one to follow the ‘can’t be done’ attitude and are constantly finding ways to improve to ensure it will be done correctly and safely.”