Introduction to Chemical Engineering Design [2] Engineering Companies and Design Institutes (1)

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1 What is an engineering company? 1.1 Definition of an engineering company An engineering company is a business that operates in the field of engineering, with project construction as its main activity. It possesses the capabilities to design projects, handle procurement, carry out construction work, manage construction processes, provide commissioning services, and oversee project management. By organizing the implementation of projects, such companies create value and earn reasonable profits. 1.2 Requirements for international engineering companies International engineering companies generally feature an international business approach, a diversified range of services, modern technical equipment, and scientific project management. (1) Full functions of general contracting for engineering projects ； (2) Post-group organization adapted to functions and a scientific management system ； (3) Possess advanced process technologies and engineering skills, as well as the ability to obtain patents and implement them in practical applications ； (4) A technical and management team of sufficient size, with a reasonable hierarchy and complete coverage of all relevant specialties ； (5) Possess advanced computer hardware and software systems as well as databases ； (6) Establish an engineering standard system suitable for domestic and international markets ； (7) Establish an ISO-9000 quality management system ； (8) Establish an HSE system ； (9) Possess a sound marketing mechanism ； (10) Possesses a comprehensive service system ； (11) Strong financing capability ； (12) Employees possess good ideological, technical, physical, and psychological qualities as well as high professional ethics. 2 The Status and Role of Engineering Companies As contractors responsible for design, procurement, and construction, engineering companies play a very important role in the project construction process, exerting a decisive influence on the project’s schedule, quality, and cost-effectiveness. 2.1 Engineering companies are the main force behind construction projects in our country, playing an important role during the period of economic structural adjustment. 2.2 The leading role of engineering companies in construction projects is decisive for saving investment, ensuring quality, and achieving benefits after the projects are completed and put into use ； 2.3 Engineering companies serve as the backbone of the entire construction process, playing a key role in improving the technical and managerial standards in construction; 2.4 By entering the international contracting market, engineering companies can help promote the export of China’s technologies, mechanical and electrical equipment, as well as construction materials. They represent an effective way to boost labor exports and enhance a company’s competitiveness on the international stage. 3. Differences between engineering companies and design institutes 3.1 Different missions (end-to-end – single phase) 3.2 Different tasks (general contracting – design) 3.3 Different responsibilities (full responsibility – only design) 3.4 Different risks (overall risks – design quality) 3.5 Different profits (multi-faceted – design fees) 4. Basic characteristics and functions of engineering companies 4.1 Basic characteristics of engineering companies Engineering companies focus on project implementation as their core business. They possess all functions related to MEPCT. Engineering companies act as technology integrators and have a team of skilled professionals. They have a comprehensive project management system, with project management at its core. Engineering companies adopt matrix management structures and have solid foundations for project management. They also have strong financing capabilities. 4.2 Basic functions of engineering companies (1) Pre-project consultation services (2) Design, procurement, and construction management services (3) EPC/turnkey project general contracting services (4) Commissioning, training, and maintenance services (5) Project management (PM) and project management contracting (PMC) services (6) Establishing project companies to undertake projects under models such as BT, BOT, BOO, and BOOT. Engineering companies are social organizations that specialize in (or primarily engage in) project construction. Its income mainly comes from providing construction services to owners, including turnkey project contracting and project management. Engineering companies that possess the capabilities for EPC turnkey project delivery and project management typically have comprehensive functions, including Project Management (PM), Engineering (E), Procurement (P), Construction (C), and Commissioning Services (T); enterprises that lack all these MEPCT functions cannot be considered engineering companies. Engineering companies are design-oriented. Design work itself involves applying various knowledge and techniques to turn an idea into a series of actionable steps, or what is known as \"engineering\". In this project, the processing of knowledge and technology is integral throughout. The capability of an engineering company lies in the integration and processing of knowledge and technology. An engineering company does not produce a single screw, but it can provide the owner with a complete factory; therefore, what plays a decisive role in the engineering company’s ability to supply the factory to the owner is its technical integration capability. Talents are the wealth of engineering companies and the foundation of their competitiveness; a sufficient number of professionals with the appropriate qualifications is essential for engineering companies to undertake MEPCT projects. Engineering companies that undertake EPC turnkey projects are required to have 34 types of management professionals. 1. Business Manager 2. Quotation Manager 3. Project Manager 4. Project Secretary 5. Quality Manager (Engineer) 6. Safety Manager 7. Environmental Protection Manager 8. Finance Manager 9. Project Accountant 10. Control Manager 11. Schedule Engineer 12. Cost Estimator 13. Cost Control Engineer 14. Material Control Engineer 15. IT Engineer 17. Design Manager 18. Purchasing Manager 19. Procurement Engineer 20. Invoicing Engineer 21. Inspection Engineer 22. Transportation Engineer 23. Construction Manager 24. Construction Technology Management Engineer 25. Construction Schedule Management Engineer 26. Construction Quality Management Engineer 27. Construction Cost Management Engineer 28. Construction Safety Management Engineer 29. Construction Materials/Warehouse Management Engineer 30. Driver Manager/Driver Engineer 31. Contract Management Specialist 32. Risk Management Specialist 33. Insurance Management Specialist 34. Lawyer. Engineering companies specialize in project management; to ensure orderly, standardized, efficient, and high-quality management of such projects, they must establish a comprehensive project management system that includes organizational structure, job responsibilities, resources, procedural documents, and work instructions, among other elements. Engineering projects are the core business of engineering companies; without projects, such companies cannot survive. In other words, one of the main characteristics of engineering companies is that they are centered around project management. The main aspects are: (1) The organizational structure meets the requirements of the project; (2) It has a comprehensive management system, procedures, methods, and manuals; (3) The personnel structure, professional expertise, and quality levels meet the project’s needs; (4) Human, material, financial, and technical resources are sufficient to support the project; (5) All activities are carried out in line with the project’s needs and objectives. Project implementation follows a matrix management approach, with project management at its core and functional departments and specialized units serving as the foundation. Advantages: (1) Rapid improvement in technical level ； (2) Make full use of human resources ； (3) Ensure project quality ； (4) Facilitates the performance of the contract. To ensure the proper, efficient, and high-quality operation of projects, foundational work is a valuable asset for engineering companies. Specifically, these include: (1) Work Breakdown Structure and its coding; (2) Organizational Breakdown Structure and its coding; (3) Dictionary of design work packages for engineering projects; (4) Dictionary of construction activities for engineering projects; (5) Standard labor hours for engineering design; (6) Baseline schedule for engineering project construction; (7) Weighted measurement table for engineering project construction; (8) Review procedures for engineering design; (9) Classification of quality control levels for engineering project construction; (10) Forms for recording quality inspections during engineering project construction; (11) Project management database; (12) Integrated software for project management; (13) Effective standards and specifications for engineering companies. Generally, construction projects require the raising of funds or borrowing of money for implementation. Engineering companies with financing capabilities can enhance their competitiveness in bidding for projects. Specifically, this is manifested as: (1) assisting the owner in securing **loan financing capabilities ； (2) The ability to assist the owner in securing loans from financial institutions ； (3) The ability to form project companies, either individually or jointly, to undertake BOT/BOO/BOOT projects ； (4) The ability to borrow working capital for the projects undertaken ； (5) The ability to provide a performance bond at the start of the project it is undertaking, etc.