Perspectives on CERN procurement beyond LHC Anders Unnervik

Perspectives on CERN procurement: beyond LHC Anders Unnervik and Lucio Rossi 31 May 2017

Lessons learned from the construction of LHC Advanced technology for a large scientific instrument 27 km circumference High-field superconducting magnets Superfluid helium cryogenics Anders Unnervik and Lucio Rossi 2

Optimizing ROI in CERN’s infrastructure Anders Unnervik and Lucio Rossi 3

Cost structure of the LHC accelerator Magnetic elements, 50% Civil engineering, 16% Cryogenic equipment, 15% Technical services infrastructure, 11% Other accelerator components, 6% Transfer lines, beam injectors & dump, 2% Total material cost: 3’ 8 BCHF Anders Unnervik and Lucio Rossi 4

A global project spanning space… Anders Unnervik and Lucio Rossi 5

…and time • • • Preliminary conceptual studies First magnet models Start structured R&D program Approval by CERN Council Industrialization of series production Start civil works Adjudication of main procurement contracts Start installation in tunnel Cryomagnet installation in tunnel Functional test of first sector Commissioning with beam Operation for physics Anders Unnervik and Lucio Rossi 1984 1988 1990 1994 1996 -1999 1998 -2001 2003 2005 -2007 2008 2009 -……. 6

…and huge volumes • • 1 170 price enquiries and invitations to tender (> 50 k. CHF each); 115 700 purchase orders (< 750 k. CHF each) 1 040 contracts of various types and amounts; 6 364 different suppliers and contractors (not including subcontractors). • Covering • standard off-the-shelf items • the development and manufacturing of equipment in accordance with functional specifications • Build-to-print items Anders Unnervik and Lucio Rossi 7

90 high-tech industrial contracts in the world Anders Unnervik and Lucio Rossi 8

Production volumes of LHC components Anders Unnervik and Lucio Rossi 9

Experimental learning curves LHC superconducting dipole magnets Anders Unnervik and Lucio Rossi 10

Experimental learning curves Learning coefficients Anders Unnervik and Lucio Rossi 11

From LHC to HL-LHC and beyond Specification & procurement strategy based on lessons learned • Legal/regulatory framework; • Procurement strategy and Invitation to tender; • Contract Anders Unnervik and Lucio Rossi 12

Legal/regulatory framework • Available governance, funding, corporate culture, staff, purchasing rules? • Seeking « fair return » among CERN Member States • Handling special « in-kind» contributions Ø In-kinds reduces contracts handled by CERN purchasing Ø However – good news – collaborating Institutes providing in-kinds must tender (using their rules): Ø USA they may tender in EU when > 15% cheaper Ø Institutes may tender all work or only components (assembly works done in the lab) Ø EU rules requires open tender for value > 209 k. Euros Anders Unnervik and Lucio Rossi 13

Procurement strategy and Invitation to tender Manage Risk Manage risk as this will help decide on the strategy. Risks must be borne by the owner of the technology, i. e. the party who knows most about the risks concerned and has the possibility to control them • Make or Buy? Taking into account potential suppliers and contractual risks • Technical specification: functional & interface vs. build-to-print? • Dual sourcing vs. Single sourcing? Security of supply & balanced return vs. additional follow-up • Act as general contractor managing the supply chain? Different contracts require different strategies Anders Unnervik and Lucio Rossi 14

Procurement strategy and Invitation to tender Ensure competition • Cooperation with industry is essential from early stages of the project in order to achieve success within business constraints • Attract interest from industry by organizing workshops (e. g. HL-LHC Industry days) • Identify areas/domains with a lack of firms in order to mobilize the ILOs to seek within their countries • Publish information. • Select the right companies • Building know-how & maintaining interest through prototyping, pre-series and series in a one-of, technically risky supply. • Competition with other products/markets • Consider producing prototypes in-house and keep the production line as spare in case Industry fails. Anders Unnervik and Lucio Rossi 15

Ensure competition, publish information Make or Buy Outputs are shared through the HL-LHC communication channels (for procurement matters): § HL-LHC procurement - Public Website with the main information and needs of HL Work Packages in terms of procurement (domains of activity, main contacts, acquisition timeline, industrial events, etc. ) § ILOs Portal (restricted access to ILOs) – Main outcomes of the Make or Buy Plan and Statistics of each country are posted regularly (at least twice per year after the Make or Buy plan update). 16

Ensure competition, publish information - Shopping Lists – List of DRs updated after each Make or Buy exercise. - Brochures – Equipment sought by each WP and firms that can provide it. - Statistics – Statistics per country with limited access to the ILO of that country 17

Procurement strategy and Invitation to tender Specify the requirements • Technical specification: functional & interface vs. build-to-print? • Clear, unambiguous, realistic • Identify responsibility for dealing with potential risks • Quality control, testing and acceptance procedures (MTF) • Review by an “independent” specification committee • invitations to tender should not be issued until the requirements are well understood and can be clearly specified, because Amendments cost time and money! Anders Unnervik and Lucio Rossi 18

Procurement strategy and Invitation to tender Drafting and issuing the tender documents • Total tender amount, include all relevant cost elements: • Design • Manufacture • Installation • Operation (including energy) • Maintenance • Spares • Consumables, etc. . • training of personnel, • Detailed price breakdowns. For comparison of bids and negotiation of variation orders and amendments Learning curves? Anders Unnervik and Lucio Rossi 19

Contract • Avoid unreasonable contract conditions, e. g. concerning liability, risks should be borne by the party in the best position to control them. • Monitor contract performance, QA inspectors MTF, etc. . . • Achieving quality throughout the project involves the establishment and enforcement of a comprehensive QAP: • Configuration management, engineering data management • Manufacturing and test plan • Inspection • Maintaining sufficient resources in the home laboratory is necessary to cope with: • tasks outside the interest and capabilities of industry • unexpected technical or commercial difficulties • Be aware of a possible “grab-and-run” attitude from suppliers and contractors Anders Unnervik and Lucio Rossi 20

Personnel resources and training Lack of personnel to face peak needs Fellowships are limited in number Acquisition of competence of teams rather than individuals… Increase in PJAS (Project Associates). • Devised for LHC and amply used also for HL-LHC. PJAS are people employed by collaborating Institutes and seconded to CERN to accomplish a common mission. • Level is engineer/physicists, may be experienced senior personnel, however the number at junior level is increasing. . • In certain cases the people are seconded to CERN on an individual basis; in other case they come as team with a team leader. • In certain cases after the period of 1 -3 years at CERN, they are permanently employed by the seconding Institute. Anders Unnervik and Lucio Rossi 21

Non-Staff personnel by age, HL-LHC and related projects 168 FTE today Anders Unnervik and Lucio Rossi 22

23 nationalities contributing and getting trained Anders Unnervik and Lucio Rossi 23

Over average female representation 21% vs 12% on Scientific Work 40% vs 6% on Technical work 140 120 100 80 60 40 20 0 Administrative work Anders Unnervik and Lucio Rossi Scientific & Engineering Work F M Technical work 24

Strong contribution from MS via special programs Human Capital represented by the exchange of Project associates, trainees and visiting scientists Swedish Spanish Portuguese Polish Maltese Italian Greek German French Finnish 0 Anders Unnervik and Lucio Rossi 5 10 15 20 25

…and now some publicity…. Anders Unnervik and Lucio Rossi

Who In total is expected 1 000 participants from mainly European businesses and organisations, who wish to engage on the Big Science market. BSBF 2018 is hosted by bigscience. dk and the Danish Ministry for Science and Higher Education and organised by the European Big Science organisations: Anders Unnervik and Lucio Rossi

BSBF 2018 business areas • Electrical, electromechanical and RF systems • High precision and large mechanical components • Remote handling systems for hazardous environment • Diagnostics and detectors • Cryogenic technology • Vacuum and leak detection technologies • Instrumentation, control and CODAC • Engineering methodologies and tools • Safety systems, licensing and protection of hazardous installations, access control, fire and gas detection • Basic material technologies, manufacturing and assembly technologies • Superconductivity and superconducting magnets • Information and communication technologies Anders Unnervik and Lucio Rossi

…and special thanks to Philippe Lebrun who kindly allowed me to use several of his slides about LHC. Anders Unnervik and Lucio Rossi 29