Wind turbines in co-development

How do you change supplier relationships to co-development? In the wind turbine industry, margins are thin. As a result, many turbine manufacturers are strapped for cash, even though their industry is booming. For this reason, our client, a mid-sized player with a long history and a proven quality track record, could not afford the needed investment to develop the next generation product line. As a mid-sized player, it was also hard to make the subsystem suppliers assume the risk of development.

For this strategic issue, B&W supported the internal purchasing director in maintaining an open yet sensitive dialogue with their 5 key subsystem suppliers. Thanks to more than 20 years of experience in creating and managing R&D consortia, B&W was able to ensure that the participants perceived each other’s needs and limitations.

Careful negotiations led to a co-development agreement based on shared risk-shared profit. B&W then supported the project management by supplying the methodology, the procedures and the human support needed to make the alliance reach results through ‘concurrent engineering’. The result? The development flow time was reduced with 20% compared to previous projects, whereas the upfront investment by the system integrator was halved (adjusted for MW rated power growth). We later continued to support the client in other R&D alliances, working side by side with internal project management to ensure that joint objectives are achieved while ensuring joint satisfaction.