| DSME: Building Reputation |
| Transportation | |
| Written by John Zorabedian | |
| Thursday, 31 January 2008 | |
 Its reputation for quality allows this Korean shipbuilding and offshore engineering firm to compete against other Asian giants, explains Jae Kwan Seo.  Jae Kwan Seo, Executive Director for DSME’s North, Central, and South American division “Our reputation comes from our performance,” said Jae Kwan Seo, executive director for DSME’s North, Central, and South American division, based in Houston, Texas. Seo, a marketing executive for 20 years, supports the company’s marketing and new business development in the Americas, a region that includes US oil majors such as ExxonMobil and Chevron. Regardless of his marketing savvy, however, Seo knows a client with a multi-million-dollar contract won’t be happy unless the company meets stringent quality specifications. “We need to satisfy our clients in each of the steps of production,” a process that takes several years, Seo said. “Every step of performance is building our reputation at the same time. Marketing power doesn’t come from the intelligence of marketing people. It comes from good performance.” Project management DSME’s business is predominantly for export, with clients in Europe, the US and the Americas, Asia, the Middle East, and Africa. The company delivers 50 to 60 vessels annually and five to six engineering, procurement, and construction (EPC) contracts for offshore vessels and rigs. With $21.5 billion in sales in 2007, DSME is the second-largest shipbuilder in the world. DSME also manufactures floating oil production units, submarines, destroyers, liquefied natural gas carriers, and oil rigs. Established in 1978 as the shipbuilding and marine engineering division of Daewoo Group of Companies, the company spun off from its former parent in 2000. Its vast shipyard employs 25,000 workers and covers 1.54 square miles. One of DSME’s major ongoing projects involves an approximately $1.3 billion contract with US oil and gas company Chevron Corporation to construct an 89,000-ton Compliant Piled Tower(CPT) production platform slated for an offshore site in the Tombua-Landana field in the West African country of Angola. A repeat order from Chevron, DSME successfully delivered a similar CPT named Benguela Belize to an Angolan offshore oil field in 2005. DSME has subcontracted the construction of the 1,300-foot drill tower to fabrication companies in the Gulf of Mexico, Gulf Marine Fabricators and Gulf Island Fabricators, that are manufacturing the tower in two pieces, while the DSME shipyard in South Korea is manufacturing the platform, known as a topside. Final construction of the CPT will take place early next year in Angola where other subcontractors are performing offshore work. DSME will commission the platform, finalizing the connections and conducting testing. DSME dispatches personnel from Korea to supervise the various subcontractors for production control, schedule control, and reporting to the product management team back in South Korea. In the course of executing these complex contracts, DSME maintains continuous contact with its clients. “I need frequent contact with the clients to maintain good relations with them and support our marketing and business development,” Seo said. “I’m the very first man in our company to contact the oil majors here in Houston for the initial development of their projects.” Usually, it takes five to six years from the initial feasibility study to finalize the installation of offshore production facilities. Seo is the communication channel between the client, the engineers, and DSME’s headquarters and shipyard in Okpo, South Korea. Client relations Given the international nature of its business, DSME needs strong communications, both internally and with external clients, to service its clients throughout the course of a contract. Seo frequently uses e-mail and telephone communications with the DSME headquarters in Korea, but for the client, he relies on videoconferencing and teleconferencing to bring the clients into contact with engineers at the shipyard. “Our business is building huge structures and very sophisticated facilities,” Seo said. “The technical requirements in the specifications are very detailed. Clients need clarification meetings between our engineers and their engineers and commercial meetings to discuss the contract and price negotiations.” Two or three times a year, Seo travels to Korea with clients to show them progress on their orders and meet with the engineers. Seo also gives presentations to the engineers concerning new technology, concepts, and systems in ship or offshore facilities. Overall, satisfying the clients is the main priority for DSME, even when it means sacrificing the bottom line to execute a contract on time. “Our strategy in this business is to maintain good relationships with our first-class clients,” Seo said. “We are trying to meet the delivery date. Occasionally, we have to use more manpower or pay certain acceleration costs to meet the delivery date—we do this even if we sometimes lose money for the project.” |
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American Executive is a RedCoat Publishing publication.
American Executive is a RedCoat Publishing publication.
