Cost Insights
by PowerAdvocate

Intelligence for energy companies seeking a data-driven approach to cost management

[Whitepaper] How Segmenting Suppliers Can Help Predict Bidding Behavior

November 26, 2018 at 5:08 PM / by Christine Oumansour posted in Capital Projects, Utility, capital program office, delivery model optimization

The variability of supplier responses to bid events can pose significant financial and operational risks to energy companies, especially as this behavior is prone to change when market and economic conditions shift. Variances in bid responses during the recent economic recession and recovery motivated PowerAdvocate to analyze the impact of macroeconomic factors on supplier bidding behavior. The aim of this analysis was to uncover trends that, when coupled with project and company-specific data, will enable industry leaders to better anticipate and mitigate project and supplier risk. If you missed our introduction of this analysis, you can read our previous blog about it here.

Our team hypothesized that suppliers who offer a diverse range of services, work across multiple industries, and service a wide geographic area respond to macroeconomic circumstances differently than smaller or more specialized suppliers. To measure these differences, and to better understand how a supplier’s profile influences their behavior, the team categorized bid data into two groups: bids from major suppliers and bids from specialized suppliers.

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[Whitepaper] Reduce Supplier Risk by Predicting Bidding Behavior

November 14, 2018 at 6:16 PM / by Michael Sojka and Isabel Schwartz posted in Capital Projects, Utility, capital program office, delivery model optimization

Historically, energy firms have seen uncertainty in their supplier’s behavior as simultaneously unmanageable and a source of severe risk for their operations. This uncertainty can cause major projects to fall behind schedule and can create reputational and financial loss for an organization.

While this risk has always been a concern for energy firms with high exposure to contractors, the volatility of today’s market highlights the need for all companies to be able to proactively mitigate the risk that suppliers pose to major projects and operations.

Leveraging PowerAdvocate’s energy supplier database of $3.3T in energy market spend and 70K sourcing events, we identified and quantified trends in supplier bidding behavior. Using these insights, energy firms can efficiently plan for changes in bidding behavior and mitigate risks during market fluctuations.

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[Whitepaper] How to Approach Utility Capital Project Delivery Model Optimization

April 14, 2017 at 11:01 AM / by Christine Oumansour & Andrew Jean-Louis posted in Capital Projects, Utility, capital program office, delivery model optimization

Maintaining profitability in a rapidly fluctuating market environment is a challenge for any firm. For utilities, structuring a Capital Program Office to meet the specific needs of projected workload is a key success factor. Achieving the optimal Delivery Model requires considering a wide range of factors – and a significant investment of time and resources. Before refining an existing or transitioning to a new Delivery Model, it pays to first understand the transitional costs, value, and ongoing savings opportunities.

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