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Baseefa Ltd

The importance of competency in the supply chain

04 May 2015

Managing competency is a complex but necessary task for organisations, and is also of great importance within the supply chain. Peter Davidson of UKPIA explains how the end user can ensure that all those involved in the supply chain have the necessary competence to carry out the tasks assigned to them. 

The explosions and fires at the Buncefield oil storage depot near Hemel Hempstead, on Sunday 11th December 2005, highlighted a new area of potential risk that had previously not been thought probable. The incident triggered a fundamental review, by the oil industry and regulators, of large-scale gasoline storage.

One of the recommendations arising from the Major Incident Investigation Board (MIIB), which looked into the causes of the incident, stated that there should be: “…emphasis on training, experience and competence assurance of staff for safety critical and environmental protection activities.” 

The Health and Safety Executive’s (HSE) 2011 publication ‘Buncefield: why did it happen?’ went further and, in relation to the failure of the independent High level switch, stated: “Those who installed and operated the switch did not fully understand the way it worked, or the crucial role played by a padlock, the switch was left effectively inoperable after the test.” 


Furthermore, the independent investigation into the 2006 Nimrod aircraft (XV-230) crash in Afghanistan reported that a mid-air fire and explosion following an air-to-air refuelling modification caused the incident, along with the following key failures:

•  Personnel weaknesses

•  Unacceptable procurement processes

 ‘Competency Management’ - and the demonstration that it is managed effectively - for sites regulated by the Control of Major Accident Hazards (COMAH) legislation in the UK, now represents one of the HSE’s strategic priorities.  It is imperative that the management of competency is at the forefront of operations and that it encompasses all those involved in the supply chain.

Challenges

Supply chains are becoming ever more extensive, with many end-users now outsourcing expertise and relying more heavily on specialist contractors, consultancies and third parties to carry out specific tasks. 

Consequently, more players are now involved in the delivery of solutions, making managing competency ever more complex. 

The Buncefield incident related to a single instrument, a single data point: the High level switch. 

To get a sense of the challenges involved, we could analyse a large automation project. It consists of thousands of data points, instruments, controllers and logic solvers. Clearly, the supply chain is manifold and complex:

The end user needs to have assurance that all those involved in the supply chain have the necessary competence to carry out the tasks assigned to them. 

For example, when considering a Safety Instrumented System (SIS), the duty holder, Engineering Procurement Contractor (EPC), Main Automation Contractor (MAC), Integrator and sub-suppliers all have specific responsibilities at various stages of the system’s lifecycle (refer to the IEC 61511 safety Lifecycle).

Therefore the following key challenges need to be addressed:

•  Each stakeholder should understand what competencies are required for the tasks they are assigned to carry out, what standards should be met, and how to interpret and critically assess the design and documentation supplied to enable them to carry out those tasks

•  Each stakeholder in the supply chain should understand the levels of competency required by its contracting partners for the tasks that they are assigned to do

•  Each stakeholder in the supply chain should be able to challenge its contracting partners if concerns over quality, or lack of required information to enable them to carry out their tasks sufficiently, arise.

•  Maintaining an overall vision of the project from concept to operation

Assuring competency in the supply chain

The development of an invitation to tender, by any stakeholder in the supply chain, should include the involvement of experts able to identify the competencies required for the services being contracted. In addition to competencies being clearly identified, the invitation to tender should require the supplier to demonstrate the ways in which those competencies will be managed.

All contracting partners should also be mindful of all information that will have to be provided to others in the supply chain, in order to allow all involved to carry out the assigned tasks. 

For instance, if the EPC is responsible for the design of a Safety Instrument System (SIS), it is pivotal that it is aware of all documentation and specifications required by the MAC in order for the SIS to be designed. This certainly goes beyond a simple ‘Cause and Effect diagram’. 

It is the end user who will have final ownership of the equipment or service and it should have a clear understanding of what the supply chain looks like:

•  Who are the companies involved and what they are required to deliver

•  The tasks which those companies are required to complete, and.

•  Where specific tasks require specific competencies (e.g. the Functional Safety Management) the roles and responsibilities of all those in the supply chain required to deliver that task need to be identified. 

Maintaining an understanding of the overall project delivery is essential – it is not sufficient that each stakeholder understands their own roles and responsibilities.  The end user should work together with the main contracting partner, for example the EPC, to ensure that project delivery is aligned and that the documentation, procedures, processes, test and commissioning protocols etc. developed by each stakeholder work in unison to deliver the project in accordance with the original requirements. 

In summary, the outputs from each phase of the project need to be understood in the context of the whole, and not simply supplied because it is felt that that is the requirement of a single supplier. 

Peer review of the supply chain may be a useful technique in ensuring relevant competencies, clarity of purpose, scope and requirements of the original design.  This technique has proved to be effective in a number of industries, particularly those involved in the delivery of large, complex projects. The mechanics of a peer reviews are dependent upon the type of project and stakeholders involved but, in broader terms, they will have to:

•  Instil a common aim for the project

•  Ensure that leadership and vision are aligned

•  Promote open and honest communication

•  Ensure that competencies are understood and managed appropriately

Conclusions

Managing competency is a complex but necessary task for organisations. It is also of great importance within the supply chain.  We should strive for a common understanding of what is required and ensure that the information, tools and personnel are available to deliver those critical tasks. 

United Kingdom Petroleum Industry Association (UKPIA), together with the Sector Skills Council in the UK (COGENT), has developed guidance for end users on Competency Management Systems (CMS), which can be accessed at: www.thegold-standard.co.uk

Whilst this guidance specifically relates to the design of CMS, some aspects are equally relevant to others in the supply chain, specifically in the areas of procurement and assuring and auditing contractors.

For more information or to become involved in the work of the UK Petroleum Industry Association and its Sector Level Process Safety initiative Assuring Safety, please visit www.ukpia.com/safety-skills-and-training/assuring-safety.aspx or contact Peter Davidson at peter.davidson@ukpia.com


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