HDEC Captures Huge Order

Company expects to win more projects in UAE as the country launches construction of petrochemical plants

Hyundai Engineering and Construction Co. clinched an order for the project to build supplementary facilities for a polymer plant from Borouge Co. in the United Arab Emirates (UAE) for $930 million, the company said recently.
The company said the order follows the company’s selection as one of the builders of the four nuclear power plants the Middle East country will import from Korea under a contract signed with Korea Electric Power Corp. at the end of last year and an integrated gas plant construction project that the company won, putting the company in a favorable position in the construction market for plant and electricity power in the UAE.
The project is the third package of the polymers plant expansion construction project in the Ruwais Industrial Complex worth $2.6 billion and being undertaken by Borouge Co. The project is to be completed in 44 months from the date of the signing of the agreement.
Hyundai Construction put itself in a very good position by winning the $1.7 billion integrated gas development plant project in the Abu Dhabi region in July last year, followed by its taking charge of the UAE’s nuclear power plant construction project as part of the Korean consortium at the end of last year, and now the polymer plant project. The company is ready to win more plant construction projects in the UAE due to the confidence the local market, including the UAE government, has in its construction expertise in comparison with firms from such advanced countries as Japan and those in Europe, the company said.
Hyundai officials said the company would not have trouble achieving its overseas project order target of $12 billion this year, since it already has secured $4.5 billion worth of project orders and sees many more project orders to come from the Middle East this year.
One Step Closer toward Global Top Leader
Hyundai E&C (HDEC) was selected the country’s No. 1 builder, beating its rivals by a large margin, the Ministry of Land, Transportation and Maritime Affairs announced July 30, 2009, in a press release. That will help accelerate the speed at which HDEC makes its way into the global top tier of companies, in addition to securing a series of large projects from overseas, even amid a global recession.
According to the press release, HDEC posted approximately 9.209 trillion won in comprehensive construction capabilities, the highest among its peers. Evaluation is conducted in terms of track record, management situation, technological capability and credit rating.
This is the first time in six years that the company regained the No.1 ranking. The company had once been in trouble, although it maintained its status as the nation’s leading company in comprehensive construction capabilities for 42 years since its inception.
Last year, HDEC became the country’s first builder to top 7 trillion won in sales, with its orders received in excess of 16 trillion won, hitting all-time highs. In the first half of this year, the company set an all-time first-half sales record of 4.6402 trillion won, with its operating profits at 231.2 billion won, firmly positioning itself as the country’s No.1 company. “The No.1 ranking is not a surprise given that the company has long been the undisputed leader in the building industry,” a company official said “Now, it is time to take another great leap forward to become a truly global leader that can compete with top notch rivals in advanced countries.”
“The No. 1 is the result of efforts all of our officers and employees have been making to fight against a management crisis during the early 2000s and our reemergence as an industry leader,” he added. “The 2009 evaluation is meaningful, not only because it helped us win back the throne, but because it also breathed a ‘can do’ spirit into us and can act as a source of power in making change and innovation.”
“The 21st century, which has been dubbed the century of culture, will see soft power prevail over hard power. In a new era of soft power, physical forces like military power will lose ground to rational and emotional capabilities.”
Harvard Professor Joseph Nye said, “We are said to live in an era of soft power. A wind of soft power, which can be summarized as creativity and emotion, has also blown across the building industry, which has long been regarded as the industry of hard power. In this regard, Hyundai E&C is not an exception.”
Since CEO Kim Joong-kyum took office, the company has been working hard to cultivate soft power among its officers and employees. One of the most pronounced changes is its employee training program. Unlike the previous one, which focused only on construction technology, a new training program has adopted an increasing number of courses on arts, humanities and philosophy ― helping to nurture emotional wisdom among the employees.
Last August, psychology was the subject of a monthly class held at the main auditorium in the Hyundai headquarters building. The instructor was Choi In-cheol, a professor at Seoul National University at the Institute of Psychological Science.
Before this, a program of a similar nature was conducted last July for a three-day period, attended by the company’s executives for the development of emotional leadership.
On a higher than expected level of satisfaction and popularity among the attendees, the company plans to expand the scope of participants to project managers and site administration managers as well as business division heads at the head office.
On the other hand, it also plans to adopt employee training programs that can be applicable directly to what they do at work, such as continuing professional development (CPD). Education programs for the employees’ spouses and children are also under consideration.
In a related move, school fee assistance has been in place for the strengthening of competency among its officers and employees.
Currently, those registered as students in executive programs in management, law and other professional areas benefit from the assistance policy.
This month, six employees, recommended by each business division, are leaving Seoul to study at Kingston University in London. Under its Quantity Surveyor (QS) master’s program, they will learn about advanced construction management techniques, sponsored by the company in terms of tuition fees and lodging expenses for one year.
“We need to nurture our employees into a talented group with creativity and imagination as well as problem solving skills,” said Jung Hee-chan, general manager of the human resources department. “We will not hesitate to pour money into employee training as long as it is concerned with the cultivation of soft power among the staff.” nw

(from Left)An oil loading wharf built by HDEC in Iran. President Kim Joong-kyum of Hyundai Engineering and Construction Co.