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Interview

R. Venkateswaran, General Manager, Aibel Pte Ltd, Singapore

29.05.2014 / Energyboardroom

Aibel is a Norwegian based leading service company within the oil and gas industry as well as the renewable energy. Could you please begin by introducing Aibel’s Singaporean offices?

Have established our local offices in June of 2007, our mandate was initially to support Aibel’s operations back at headquarters in Norway. In parallel, we were focused on growing our Singaporean team while beginning to explore opportunities in the region. That is the base from which we started building up Aibel’s Singaporean presence. When we first started in 2007, we were composed of some 38 people whereas today, there are approximately 400 dedicated employees at our offices. This illustrates just how successfully and significantly we have grown over the past six years.

What were among the most notable milestones in the company’s six year history?

A defining point in our local history was getting the team up and running and the smooth operation of the projects we had been tasked with. Being strong supporters of an organic step-by-step developmental process, establishing ourselves in Singapore did take a fair amount of time but we believe we have successfully managed to diligent and enduring manner.

Naturally, we first began by taking on smaller projects but as time went by, we steadily scaled up our scope and operations until we were executing large projects like Gudrun for Statoil which was awarded in July 2010. This was a significant project that was a milestone project in which Aibel was responsible for the engineering, procurement, construction and commissioning Gudrun platform which was completed in 2013 and is now in the North Sea. This was a mammoth project which involved some 400,000 man hours from Singapore alone and was spread across Norway, Singapore and Thailand.

Outside of home in Norway, Aibel has a concentrated presence in Thailand, Singapore, UK, Denmark, and Egypt. What’s the strategic purpose of the company’s Singapore presence?

Aibel’s goals from the get go was to establish an Asian hub and Singapore was the ideal location for that. Indeed, the Thailand yards have been a part of Aibel’s international presence for quite some time, and so the aim was to establish a hub that would integrate the yard which would ultimately be presented as a complete package to the clients. As we speak, we are in that process of integrating the Thailand yard with our local operations. The yard has already executed many fabrication only contracts and now we are carrying out engineering only contracts. The next step would be to bridge these two and effectively become an integrated engineering, procurement and construction. That is at the core of Aibel’s service offering, from conceptual design, to decommissioning and we are looking to replicate that in Asia.

With many investments in the upstream flowing to Asia, what is your personal outlook in the region?

I am rather positive and optimistic about the regional prospects. We anticipate there to be many growth opportunities especially in Asia and we are well position to capture a proportion of that.

As a Norwegian based organization, we have successfully been able to get our foot in the door in the region. Our first goal as a company was first to demonstrate our capabilities in the regional context and this has been taking place through our presence in Thailand with the fabrication yard. More recently, we have continued to do that with our Singaporean offices. If all goes to plan, we will soon have established ourselves as a recognized integrated EPC contractor in the region.

In 2009, Aibel CEO & President Jan Skogseth told Focus Reports that Aibel would focus on penetrating the South East Asian market. Considering the competitiveness of the EPC market in Singapore, what would you say are the durable competitive advantages Aibel Singapore holds over its international and local competitors?

Our high level of flexibility is one attribute that differentiates Aibel. We have the capacity to seamlessly adjust ourselves to the requirements of both the market and the client in terms of operations and project types. We have the systems and procedures to execute different projects as per the clients requirements as an integrated team together with the client, for instance, but also as a standalone project if need be. Aibel is also among the few contractors that has the capacity to execute EPC projects that adhere to the stringent North Sea standards.

In addition to this, we have the ability to offer the highest levels of quality at competitive rates. People tend to associate Norway with premium price levels but this is not the case with us. Aibel in Singapore proves that you can have an Asian hub that is closely supported by the Norwegian headquarters, while offering highly competitive market prices. In part, this is why we have established ourselves in Singapore rather than a lower cost destination in Asia.

Singapore’s engineering talent pool is notorious for being skilled and professional. However, the talent pool is often viewed by executives as constrained due to a lack of people. In such a competitive market for talent, how do you view and respond to these challenges?

As an organization, we like to invest in the local talents in the countries in which we operate. Our offices here are adjacent to the National University of Singapore (NUS) and we like to take advantage of that. As such, we like to attract as many fresh graduates as we can, bringing in about 20 to 30 each year. These future professional will represent our future pool of talent. Of course, it is not too difficult to bring in foreign talent into Singapore as long as it is justifiable, but we do not see that as a long term solution as it will have turnover implications, for instance. Given our long term focus in the country and region, we are committed to building up a core base of Singaporean talents.

Admittedly, investing in young talents is a resource intensive job but that is one aspect of Aibel that we can be proud of. We have been investing in local talent right from the beginning since we had to adhere to the notoriously demanding North Sea requirements imposed by our clients like Statoil for instance.

We therefore invest heavily in training our people not only on the technical side, but also on the cultural side as well. We have a particular emphasis on maximizing the intercultural understanding of our employees given the high levels of interactions between our various offices. The apparent cultural gaps between Norway and Singapore are certainly there and we are always working on bridging these. In doing so, we are now seeing the fruits of our labor. The early recruits we have hired in 2009 are now highly productive and we enjoy a rather low rate of employee turnover.

For engineering talents, the Singaporean outfit is an attractive place to be. We always have a steady flow of projects coming in from Norway through our long term agreements with clients and we typically execute about 500,000 man hours of project work on an annual basis. In addition to this, as we begin to expand our footprint in the region, we can only expect the level of projects we engage in to grow, offering our employees valuable experience.

Given Aibel’s Norwegian origin and Singapore’s status as a cultural melting pot, how do you go about managing and aligning the different cultural dynamics of the organization?

We like to keep an open mind and accept people for who they are, not who you want them to be. Generally speaking, appreciating to the different cultures in Singapore was not so much of a challenge given the diversity of nationalities found in the country from across the world.

Nevertheless, given the unique cultural and behavioral traits of the Norwegians, we encourage all of our employees to participate in cultural awareness programs that would help to bridge these gaps. This is of the utmost importance since Aibel’s people and engineers typically work on a split-taskforce basis across our international offices. Our engineers at the Singapore office, for instance, are always communicating with our Norwegian headquarters on a daily basis, collaborating on a number of tasks or projects.

As part of our cultural awareness programs, we also second a lot of our people from here to Norway, among other destinations. Each year, we have approximately 100 people from Singapore, based in Norway for a period of six months to a year. Not only does this allow our people to gain international working experience in some of the most demanding locations of our industry, it also exposes them to personal interactions with different cultures. In recognition of the benefits and experience that Singaporeans can derive from this exchange, it should be noted that the local Economic Development Board (EDB) has been supporting us greatly in this regard.

We find that that close interpersonal interaction among our people is something they value greatly and is perhaps a significant contributor to the generally low employee turnover we have historically observed.

Where can we expect to see Aibel in Singapore three years from now?

Through our Aibel International business unit under which manages the company’s foreign offices, we have crafted a strategy designed to expand our global footprint. As such, Singapore is an integral component of those ambitions forming the foundations of the Aibel’s venture into Asia.

Having covered the fundamentals and established our business here in Singapore over the past few years, we are now increasingly looking outward towards the region looking to establish our brand name and capture a greater share of the market. We are well positioned for growth both technically and operationally and we have already acquired the office space necessary to expand our local team. Given the prevailing market conditions and the vast opportunities present in the region, our target is to grow to about 850 o 1,000 employees over the next two to three years.

To read more articles and interviews on Singapore, and to download the latest free report on the country, click here.

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