positive risks in - in the menu: to change e&c industry...
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This document and the information contained herein is l’Air Liquide S.A. or one of its affiliates’ property. The document is confidential business information and may furthermore contain confidential technical information. Any reproduction or disclosure of all or part of this document to third parties is prohibited without the express written consent of an authorized representative within the Air Liquide Group. If you have received this document by mistake, please immediately notify the sender and destroy the original message.
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
Frankfurt • June 2019Mayank Agarwal • Global Risk Mgt Director
ENGINEERING& CONSTRUCTION
DISTRIBUTION LIST : ECRI Sponsors
Positive Risks in E&C Industry: Identification & Treatment
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ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
2
Contents
1 About Air Liquide
2 Process for Positive Risks
3 How to identify Positive Risks
4 How to treat them
5 Conclusions / Benefits
6 Q&A
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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1About Air Liquide
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March 2018 Group presentationTHIS DOCUMENT IS PUBLIC AIR LIQUIDE, THE WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
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A world leader ingases, technologies and services for…
● a wide range of industrial processes for our customers:
– energy, metals, food, chemicals, automotive, pharmaceuticals…
INDUSTRY HEALTH
● hospitals● patients at home ● hygiene and specialty
ingredients
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March 2018 Group presentationTHIS DOCUMENT IS PUBLIC AIR LIQUIDE, THE WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
2017 key figures
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~65,000EMPLOYEES
PRESENT IN
80COUNTRIES
REVENUE
> €20bn
MORE THAN
3.5 MILLIONCUSTOMERS & PATIENTS
NET PROFIT
> €2bnCASH FLOW
> €4bn
2017 Figures
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March 2018 Group presentationTHIS DOCUMENT IS PUBLIC AIR LIQUIDE, THE WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
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Group revenue surpasses €20bn
GAS & SERVICES
96%Industrial Merchant
Large IndustriesHealthcareElectronics
ENGINEERING& CONSTRUCTION2%Air Separation UnitsHydrogen and CO production unitsTechnologies
2017Revenue
€20.3bn GLOBAL MARKETS& TECHNOLOGIES2%
Markets:Energy transition, Scientific exploration, Maritime logistics
2017 Figures
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April 2017Air Liquide Engineering & Construction •
THIS DOCUMENT IS PUBLIC Air Liquide, the world leader in gases, technologies and services for Industry and Health
Air Liquide Engineering & Construction presentation 7
A technology partner of choice
● Air Liquide Engineering & Construction builds the Group’s production units - mainly air gas separation and hydrogen production units - and supplies external customers with its portfolio of technologies.
● Its industrial gas, energy conversion and gas purification technologies enable customers to optimize the use of natural resources.
Patents
1,600Proprietary
technologies
60
Engineering centers and
front-end offices
15Manufacturing
centers
3
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April 2017Air Liquide Engineering & Construction •
THIS DOCUMENT IS PUBLIC Air Liquide, the world leader in gases, technologies and services for Industry and Health
Air Liquide Engineering & Construction presentation
Our expertise
8
WITHIN AIR LIQUIDE GROUP
● Design and build Group’s industrial gas production units
– Solution oriented towards our gas customers
– Plant life-cycle optimization
– Supporting operations
● Sustainable and competitive technology & process solutions
– Industrial gases (O2, N2, H2, CO, CO2, rare gases)
– Energy conversion and clean fuels
– CO2 capture
– Gas conditioning and purification
– Leveraging Group’s operation experience
FOR OUR EXTERNAL
CUSTOMERS
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April 2017Air Liquide Engineering & Construction •
THIS DOCUMENT IS PUBLIC Air Liquide, the world leader in gases, technologies and services for Industry and Health
Air Liquide Engineering & Construction presentation
Full coverage of the entire project life cycle
9
Process TechnologyConceptual & Front-End
Engineering Design Integrated Solutions
Licensing engineering services & proprietary equipment
High-end engineering & design capabilities
Project management and execution services
I
April 2017Air Liquide Engineering & Construction •
THIS DOCUMENT IS PUBLIC Air Liquide, the world leader in gases, technologies and services for Industry and Health
Air Liquide Engineering & Construction presentation
Our technology portfolio
10
Cryogenics technologies:
● Air separation units● Liquefied Natural Gas● Standard Plants● Gas treatment
Lurgi technologies:
● HyCO● Downstream &
Petrochemicals● Oleochemicals
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April 2017Air Liquide Engineering & Construction •
THIS DOCUMENT IS PUBLIC Air Liquide, the world leader in gases, technologies and services for Industry and Health
Air Liquide Engineering & Construction presentation
Our locations worldwide
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CalgaryMontrealHouston
VitryChampignyFrankfurtKrakowKievMoscow
New Delhi
BeijingHangzhouShanghaiKobeSeoul
Johannesburg
Ras Al KhaimahAbu DhabiDubai
SingaporeKuala Lumpur
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
12
2Process for Positive Risks
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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● Through dedicated programs e.g. – Profit Enhancement Plans– Value Engineering– Value Add analysis
=> Focussed on identifying & treating positive risks
● Through integrated Risk Management process– Threats & Opportunities Process – Identification by the same team– Use same risk review meetings
=> Focus required on identifying & treating positive risks
How does it work within E&C Industry
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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● Risks ISO 31000: 2018 – Effect of Uncertainties on Objectives
=> Uncertainties that might impact Objectives (probability) (impact / severity)
● Positive Risks / Opportunities=> Uncertainties that might positively impact Objectives (probability) (impact / severity)
What are Positive Risks (Opportunities)
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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Generic Iterative Process (adapted from ISO 31000)
Implement Actions
Identify Risks
Analyze Risks
Prioritize Risks based on Impact
Plan Risk Treatment
Monitor & review(How is the project risk profile evolving?)
Communicate & Consult(with all stakeholders of project objectives)
Define Objectives
(Severity) (Mitigation)
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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3Identify +ve Risks
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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Positive Risks
Could be overcome by Encouraging Positive Thinking also during Risk Reviews
● Harder to identify
● Fewer by definition
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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● How could we prepare ourselves, in case we might get lucky?
● What should we do now, so luck might be on our side?
● What could we do better, if some constraints that might be relaxed?
● ….
What questions to ask?
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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4Treat +ve Risks
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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Avoid
Transfer (to others)
Reduce / Mitigate
Accept
Escalate / Pass On
Exploit (make sure)
Share (with others)
Enhance (maximize)
Accept
Escalate / Pass On
Increase Surety
Involve Others
Change Impact
Accept the Risk
Inform Others
-ve Risks +ve Risks
Use General Terms / Risk Treatment Strategies
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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How to Exploit an Opportunity ?
● Take decisions to ensure it happens
● Eliminate uncertainty
● Increase probability of occurrence upto 100%
● Strengthen Causes to increase chance of happening
● Change project strategy or scope to include opportunity
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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How to Enhance an Opportunity ?
● Increase the Impact of Risk
● Prepare for decisions to be taken once it happens
● Target the “Impact Drivers” to maximize the impact
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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How to Share an Opportunity ?
● Which party is in the best position to exploit / enhance the Risk?
● If needed, a formal contract could be entered on profit/cost sharing, etc.
● Delegate the action, but retain ownership
● Follow regularly on actions towards desired outcomes
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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5Why should we do it?
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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Benefits of Managing +ve Risks
● E&C Industry typically works on low margins - Managing
Opportunities helps enhance profitability
● Increase chances of success / meeting project objectives
● Better define the contingency needs
● Not depending on “getting lucky”, but preparing for it
● Risk Mgnt adding value towards profit enhancement
● Encourages innovation
● Motivates team
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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6What are you doing?
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
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Introspect our processes
● How many +ve Risks v/s Total Risks identified (1%, 5%, 20%?)
● Do you have an integrated threat & opportunity process?
● Are you using the right terms (e.g. treatment v/s mitigation)
● Are you reminding the concept of +ve risks during each risk
review?
● How do you follow the enhancement / exploit strategies?
ENGINEERING& CONSTRUCTION
I AIR LIQUIDE, A WORLD LEADER IN GASES, TECHNOLOGIES AND SERVICES FOR INDUSTRY AND HEALTH
Wiesbaden • 2019 Q2Mayank Agarwal • E&C Global Risk Management Director
Managing Positive Risks
THIS DOCUMENT IS ••CONFIDENTIAL-RESTRICTED
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Thank You
28
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