5 Common Problems with Third-Party Contractors at Large Industrial Facilities (And How to Mitigate Them)

Large industrial facilities often rely on third-party contractors for various tasks, including maintenance, repairs, and upgrades. While outsourcing these tasks can be beneficial in terms of cost savings and efficiency, there are several common problems that can arise when working with third-party contractors. In this blog post, we will discuss some of the most common issues and how to mitigate them. Companies use Stilt’s contractor software to manage these problems, below are 5 of the common problems facilities face:

  1. Lack of Communication

One of the most common problems with third-party contractors is a lack of communication. If communication is not clear and consistent, it can lead to misunderstandings, delays, and mistakes. To prevent this from happening, it is important to establish clear lines of communication from the outset of the project or engagement. This can include regular meetings, email updates, and progress reports. It is important to ensure that all parties have access to the same information and documentation to prevent miscommunication. While this might sound like an easy goal to achieve, in a diverse operations environment with frequent challenges and urgent problems, a miscommunication issue can extend downtime in immeasurable ways.

Even more interesting is that when looking back at historical reasons that caused downtime for a plant, it is rare you will find a downtime code for “poor communication”! But anyone who has been in a plant environment can likely tell countless stories of how the plant stayed down longer than it needed to because someone didn’t communicate clearly. When you look at incident investigations of chemical plant accidents that led to fatalities (Chemical Safety Board) you’ll often read how the incident could have been avoided if there was better communication. This is why the Management of Change process exists!

When a facility implements Stilt to manage work assigned to third-party contractors, it is a centralized, digital platform to ensure all parties have access to the same information. Just like how radios at the plant can be heard by all who are on that channel, information in Stilt can be viewed by all who have permission. Even better — the data in Stilt is kept with a full audit trail and event history so you can better investigate incidents.

2. Safety Concerns

Industrial facilities are often dangerous places, and it is critical that third-party contractors follow proper safety protocols. Unfortunately, some contractors may cut corners or ignore safety procedures, putting themselves and others at risk. To mitigate this risk, it is important to establish clear safety guidelines and ensure that all contractors are properly trained and certified. Regular safety inspections and audits can also help identify and address any potential hazards. Additionally, each facility has its own set of requirements that contractors must adhere to.

With Stilt, contractors can complete digital checklists for safety inspections, audits, and more. Facilities can even use their own existing checklists and require contractors to fill them out in the field with Stilt. KPIs and reports allow management to hold contractor work groups accountable. With the Compliance and Document Management tools, contractors can upload their insurance documents, safety certifications, training records, and more. Stilt will automatically send reminder emails when documents are nearing their expiration. With these tools, facilities can have the full picture into which contractors are compliant and able to perform work on site safely.

(Related: OHSA and Scaffolding – Ensuring Compliance in Scaffolding)

3. Quality Control

Third-party contractors may not have the same level of quality control standards as the facility they are working for. This can lead to subpar work, which can result in costly repairs and downtime. To prevent this, it is important to establish quality control standards and ensure that all contractors are aware of them. Regular inspections and audits can help ensure that all work is up to the required standards. Additionally, these inspections and audits need to be stored somewhere where management can easily go back to them if there was ever an incident. Stilt’s event history and data capture tools ensure this data remains accessible for many years after the work was completed.

Typically, industrial facilities are operated by companies that have many other facilities. The contractors and work groups who work at one facility will often service the other plants in the fleet. Often this is the result of a great contractor being recommended to work at the other locations. We all know contractors who have left a bad reputation on a job and ultimately got kicked off-site at all locations! When a company implements Stilt at its facilities, contractors can be benchmarked against each other and among the different facilities within the company. This ensures a high level of quality control by allowing facility managers the ability to select the best contractors by looking at KPIs, measures of efficiency, job feedback, and more — data that is all captured and accessible directly in Stilt.

4. Lack of Expertise

Not all third-party contractors have the same level of expertise or experience. This can lead to delays and mistakes, as contractors may not have the necessary knowledge or skills to complete the task at hand. To mitigate this risk, it is important to thoroughly vet all contractors and ensure that they have the necessary experience and expertise. It may also be helpful to provide training and support to contractors to ensure that they are up to speed on any unique aspects of the facility.

As companies grow, they need to manage the shift from “tribal knowledge” to standardized processes. Adding Stilt to your work process ensures a level standardization that you cannot achieve through ad-hoc means. Even if your work process is difficult and with many nuances, Stilt can be configured to work for you. The benefit is that once we’ve worked with your company to digitize your work process, it becomes the de-facto standard and ad-hoc calls, texts, and spreadsheets (forms of tribal knowledge) become unnecessary.

5. Cost Overruns

Third-party contractors may provide an initial quote, but the final cost of the project may end up being much higher than expected. This can be due to unforeseen issues or changes in scope. To prevent cost overruns, it is important to establish a clear scope of work and budget before the project begins. It may also be helpful to include a contingency budget to cover any unforeseen issues.

Just like how companies can benchmark the quality of contractors (see item #3 above!), Stilt can be helpful in benchmarking the cost controls and project management practices of various work groups. By enabling cost tracking in Stilt, facility managers can easily understand how cost overruns happen and if specific contractors are better or worse than others.

Third-party contractors can be a valuable asset to large industrial facilities as long as these problems outlined above do not outweigh the benefits of working with them. By establishing clear lines of communication, safety protocols, quality control standards, and by vetting contractors for expertise, facilities can mitigate the risks associated with working with third-party contractors. By doing so, facilities can enjoy the benefits of cost savings and efficiency without sacrificing safety or quality. Demo Stilt to learn how we can help you solve these contractor software problems!

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