SAUDI ARABIA - Real Estate & Construction
CEO, El-Seif Engineering Contracting Company
Ahmed Ibrahim Al Bassam is a visionary CEO who has worked in Europe and across the GCC. His multi-sector experience over the last 25-plus years includes oil and gas, power generation, manufacturing, global logistics and procurement, and construction. Prior to his current role as CEO of El-Seif, Al Bassam was group CEO at Al Rajhi Holding for six years and EVP at the Industrial Group for six years, following 11 years at Schlumberger, where he held executive leadership roles. He is an alumnus of KFUPM, where he graduated with a bachelor’s degree in electrical engineering in 1992.
What is El Seif’s view of the challenges and opportunities facing the construction sector in Saudi Arabia?
At the macro-economic level, the country has embarked on a bold new direction in Vision 2030. We are experiencing a period of unprecedented growth with the development of new giga-cities and critical new infrastructure that will diversify the Saudi economy and improve the quality of life for Saudi citizens and residents. We are creating history and let’s be clear, astute decisions we make now will define Saudi Arabia’s legacy on the world stage. Looking beyond 2030, As Saudi Arabia expands its economic footprint beyond its borders, I see Saudi contractors expanding internationally to become globally competitive businesses and a high-value export in international markets. The capital projects under Vision 2030 are larger, and more sophisticated. Many of them are first of a kind, such as the “The Line” at Neom. Delivering these visionary projects under fast-track conditions requires more than just a step-change but a complete reset of how we view capital projects. Success is predicated on our collective ability to challenge conventional and traditional norms and methodologies to find solutions to extremely complex challenges that demand cutting edge innovation. The entire construction ecosystem of developers-government regulations-stakeholders-supply chain-consultants-designers-contractors needs significant overhaul to create a high-value and efficient value stream that can support Vision 2030 capital delivery.
At the construction reform level, Saudi contractors are a key part of the ecosystem and the main conduit for delivering the construction projects of Vision 2030 to the public. Until recently, there has been no single regulator or sponsor for the construction industry. Furthermore, Saudi contractors have endured several challenging years driven by low oil prices, and more recently, the coronavirus pandemic. Some key construction players have disappeared from the market altogether, and only a handful of capable Tier I main contractors remain today, and they are struggling to retain their core resources in a heated market which has driven up staff costs significantly with developers, consultants and contractors recruiting from the same limited pool. Therefore, to deliver Vision 2030, supporting Saudi contractors is a matter of national interest. The public and private sectors need to work closely together to address the challenges of the heated market and drive real reform to create a high value work stream across the construction ecosystem. The scope of this collaboration or new sponsoring government body needs to revisit current regulations that have hindered the contractor’s ability to bring in the right resources and operate efficiently, revamp the outdated traditional procurement approach to tendering of new projects, regulate against the transferring of client risks on to contractors as a condition for winning new work, and fairer, quicker administration of contract changes and disputes to ensure that contractors are compensated in a timely fashion for all the work they do. Improving the supply chain, investing in local content, developing, and securing human capital, and supporting growth and investment in new technology are also critical to an improved ecosystem as is the coordination of projects between PIF development companies to ensure the market is collectively able to deliver the priority projects in a timely fashion that the nation deserves. Saudi Arabia has millions of jobs in construction and a critical shortage of skilled workers. Therefore, developing a human capital of local technicians and craftsmen is a strategic opportunity to further improve unemployment and raise the level and quality of local content representation in one of the largest and fastest growing industries in Saudi Arabia.
How would you assess the company performance in recent years and what are the main highlights and milestones achieved by El Seif Engineering Contracting?
We came out of COVID in fighting form. We have launched and completed our visionary 5-year business planning strategic initiative. This will lay the groundwork for our strategic direction over the next 5 years to create a more resilient company and provide a platform for profitable and sustainable growth by evolving our operating model and go-to-market strategy, expanding on our mix and range of services, pushing our strong ESG agenda, and delivering on our digital innovation vision. We have been hard at work on our new strategy.
We ventured into new sectors serving new reliable clients, formed strategic partnerships with key international organizations, and won exciting new landmark work that would diversify and enhance our projects portfolio which we are executing to a world class standard under challenging global market conditions driven by the Russian Ukrainian conflict and a global energy crisis which have severely impacted procurement on projects.
Notwithstanding the market challenges, we are on track to complete and physically hand over eight projects this year worth collectively over SR 5bn. Furthermore, seven more projects worth collectively over SR 5bn are on track to receive Final Acceptance and Handover certificates.
Technology and automation have become a key part of any digital transformation. Over the past few years, we have made significant strides in modernizing our back-office systems and infrastructure to support growth and scale as well as ensure productive virtual operations. In 2020, we were the first organization in KSA to achieve the BSI benchmark of excellence in digital engineering and virtual project delivery (BIM ISO 19650). We have since turned our focus to our EPC core processes as an investment in our future competitiveness to improve business results.
We have been hard at work on our digital transformation journey. We recently signed a historic, game-changing contract with a world-class construction technology provider, to deliver a bespoke, end to end fully integrated digital EPC enterprise and project management system over the next two years that will allow us to run our day-to-day project operations more efficiently, optimize resource utilization and productivity, expose performance risk, and realize improved margins associated with standardization, integrated delivery, connectivity and leveraging of new technologies. This is a necessary step to build our company for the long term to ensure our structure, tools and processes keep pace in the rapidly changing digital age.
El-Seif is one of the best-known engineering and construction firms with a long history of megaprojects in Saudi that have transformed the skylines of the region’s major urban centers for decades. What is your value proposition?
The success of El-Seif lies in our unshakeable commitment to the organization’s core values: Integrity, Innovation, and Excellence. For all our customers, the certainty of safety, quality, cost and schedule that we deliver is critical. Their view of our performance in these criteria is reflected in how they often entrust El-Seif with new and complex projects.
Since the establishment of El-Seif Engineering Contracting in 1975, we have maintained our commitment to the highest standards of quality in delivery through our world class people and processes. El-Seif’s long established knowledge of the local construction landscape and supply chain in KSA coupled with our relentless pursuit of excellence and innovation has earned El-Seif the reputation for getting the job done “right” no matter how complex, no matter how large.
We are a people-based business and foster a problem-solving culture with clear values and strong, servant leadership.
El-Seif people are BOLD about innovation: We believe in the principles of practical innovation that we consistently deploy through a rigorous regime of continuous improvement, which in turn advances our people, processes, and technology platforms, without fear of first-time application. We will continue to invest in best-in-class E&C capabilities and modernize our construction industry through delivery excellence, innovation and leveraging of new technologies such as VR, AR, robotics, off-site modular construction, 3-D printing, Drone, BIM 5D, and digital solutions.
Our customers and partners see us as integral to their success. We will anticipate their needs and deliver on every commitment we make.
How is El-Seif Engineering Contracting positioned to support the economy to achieve the targets set by Vision 2030?
El-Seif has a keen, patriotic interest in the country’s overall economy and Vision 2030. Our alignment to national strategic ideals (Vision 2030, NTP, Local content etc.) means that the future of our business is vested with that of the Kingdom and the industry we serve. As a major player in construction, our mega projects have a multiplier effect on the Kingdom’s GDP. We are focused and engaged in delivery of Vision 2030 critical infrastructure. El-Seif continues to grow as a leading force in the region’s business and construction industry. Its growing resources and expanding activities in strategic sectors of its regional markets underpin El-Seif’s role as an instrument in the region’s progress towards a better future.
SAUDI ARABIA - Industry
President, Royal Commission for Jubail & Yanbu
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