BUS604: Innovation and Sustainability

Product/Market Innovation

Van Oord has always sought to innovate to stay ahead of the pack. It has done so in a number of ways, most importantly by adapting its product portfolio in accordance with market developments. In post-war Holland, it seized the opportunities created by reconstruction and economic development to move into new areas such as port expansion and the building of new roads, canals, harbors, and industrial estates.

When the Middle East dredging business was about to boom, Van Oord Utrecht moved in. When the oil boom fuelled economic development in the North Sea, the Middle East, and the Far East, Van Oord was there to benefit, as it did when Dubai wanted to realize its ambitions. At the beginning of the twenty-first century, it saw the potential opportunities offered by the new industry of offshore wind power, again in the North Sea. This helped neutralize the effects of the sharp fall in oil and gas prices after 2015.

Many of the projects Van Oord participates in are awarded on the basis of a tender process. This is a well-known but complicated system. "The potential bidders extensively study the project for a limited amount of time, calculate a price, and put forward a bid proposal," explains Koos van Oord. "The client studies the various bids carefully and awards the project based on a limited number of criteria which often are unknown to the bidders.

This does not make the tender system transparent, it is complex and often frustrating. But on the other hand it is a driving factor for innovation and for staying competitive. Nowadays the tender system generally allows the bidders more design flexibility, which stimulates innovation".

Project Innovation

"Project innovation - do it better, do it faster, do it cheaper - is a driving force," says Koos van Oord. "If we want to win tenders we have to be innovative".

A good example of a technically innovative project was the Delta Works. The technical challenges were so huge that new knowledge, equipment, and execution methods had to be developed. So Van Oord, in association with its consortium partners, the client, the Ministry of Public Works, and knowledge institutes, developed the technology to be able to carry out these projects with the required purpose-built floating equipment.

Equipment Innovation 

For decades now, Van Oord has been in the forefront of developing marine equipment, frequently purpose-built. Van Oord was one of the main contractors in the Maasvlakte 2 project, Rotterdam, the Netherlands. The works involved reclaiming land from the sea to create a huge harbor area. Maasvlakte 2 was the biggest civil engineering project in the Netherlands since the Delta Works.

Van Oord used a specially developed crane, the "Blockbuster", to place 2.5-meter3 blocks in an 11-kilometer sea wall. This type of crane had never been used before in marine construction. "In our field of activities, the equipment you use is vital," says Koos van Oord. "We are not like civil engineering companies that can rent equipment such as cranes, trucks, and other tools. There is no rental market in marine construction. So we have to own and operate the marine equipment - there is no alternative.

"In the development of marine equipment, over time you see on the one hand a limited number of breakthrough innovations while on the other hand there are many more incremental innovations. If you look at the ships we are building nowadays, they look very much like the same equipment we built 20-30 years ago.

But if you look at output, fuel consumption, emission, and so on, the differences are significant. The basic requirement is for new marine equipment that can be employed in an efficient and effective way for a period of 20-30 years and that it is a cost price leader. The new ships Van Oord brings to the market are largely developed in-house.

"If we work on the development of new equipment, we have to realize that new equipment must last for many years so we have to think ahead about possible future market developments. We can only predict changes in the market for a limited number of years, say two to three, but we need to think much further ahead.

To avoid becoming too dependent on one single market, we also build ships that have a multi-purpose character. The downside of a multi-purpose ship is the risk that they appear to not be competitive in any specific market. This is the dilemma of multiple functionality versus competitiveness.