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This story was published Sunday November 15th 1998 By John Stang, Herald staff writer Fluor Daniel came to Hanford two years ago like a hotshot freshman recruited to play quarterback for a major college football team. The new site manager for the Department of Energy's nuclear reservation was green but reputedly talented. And as fall arrived, the new kid was put in charge. But the promise of that talent ran into the reality of a faster-paced, higher-stakes game than high school. The result was a season with plenty of mistakes. Opponents, veteran coaches from a raft of state, local and federal agencies, spectators and reporters zeroed in on the new kid. They groaned when he didn't see a blitz coming. Cringed at the incompletions. Griped about the play-calling and execution. Watched the erratic struggle produce a mediocre first season. A post mortem of the first year revealed: The Department of Energy, Fluor and Fluor's subcontractors had grappled to work out their individual roles. Fluor took a while to discover that managing Hanford also requires extensive political and community leadership roles. Fluor had learned Hanford's technical problems were more complicated than imagined. Now, the contractor's sophomore season wrapped up Sept. 30, and the statistics still are being compiled. No one is talking Heisman Trophy yet, but quick calculations reveal fewer fumbles, interceptions and misplays. Fluor now has its contractors working more like a team. And the coaches and spectators appear to agree the wins outnumber the losses. "I think they've made significant strides this year," said Pam Brown, the city of Richland's Hanford analyst. The question now is whether Fluor will show more improvement in the third year of its almost $5 billion, 5-year contract. "I think Fluor Daniel is still groping, still trying to find their niche. They have a lot of room for improvement," said George Kyriazis, vice chairman of the Hanford Advisory Board. The final evaluation of Fluor's sophomore year will show up in two ways in a few months: The company's annual self-review and DOE's performance evaluation. On its first review of how well it and its subcontractors did in 1997, Fluor gave itself mixed marks. The second self-review is expected to be done within a few weeks, said Ron Hanson, Fluor Daniel Hanford president. Also coming is DOE's evaluation - which will determine how much of a possible $50 million performance fee Fluor will earn. DOE officials expect that report to be done in late December or in early 1999. Its first performance fee award in 1997 was $29.9 million of a possible $54 million - or 55.3 percent. "I think the fee or lack of a fee in the first year was a motivating factor. No question about it. They realized they had to make changes," Brown said. Here are some glimpses of Fluor's second year: The roles of Fluor and DOE. Fluor and DOE still struggled to determine how closely DOE should supervise Fluor. Fluor wanted lots of elbow room. DOE wanted to keep Fluor on track but wrestled with how much leeway to give Fluor to manage the site. The quandary has been gradually resolved over two years, but the complex relationship needs constant fine-tuning. Senior leaders of DOE and Fluor met in Yakima in September to further discuss their roles, and both Hanson and DOE Hanford Manager John Wagoner came away optimistic. Wagoner, Hanson and their two chief deputies plan to meet routinely to settle differences before they become major problems. The roles of Fluor and its subcontractors. Fluor struggled during its first year to handle its six main subcontractors. Waste Management Federal Services of Hanford flourished in its various missions with little supervision. B&W Hanford zoomed forward with cleaning out old processing plants, but bogged down at the Plutonium Finishing Plant. Lockheed Martin Hanford Corp. blossomed at the tank farms, but balked at Fluor's supervision. And DE&S Hanford and Fluor both struggled with how to remove spent nuclear fuel from the K Basins. In the second year, Fluor and its subcontractors have worked to improve their relationships. "They have come to realize one size does not fit all," said Mike Wilson, the state Department of Ecology's nuclear program manager. Hanson said Fluor has learned to be more flexible and has tailored its relations to each subcontractor. Fluor adjusting to public scrutiny. Fluor took heavy flak in its first year for lack of openness with regulators, regional interests and the Tri-Cities. The company was not used to operating in the closely scrutinized Hanford fish bowl. "There's a lot more open communication now. They listen to our concerns and take them into consideration," said the Department of Ecology's Wilson. "In the first year, we were not on their screen. It was almost like we were a nuisance they had to put up with," he said. A similar situation unfolded with the Hanford Advisory Board - an influential 32-member body that represents the entire Hanford political spectrum. "Ron Hanson looks at the board as something that adds value. Hank Hatch (Fluor's president in its first 1 1/2 years) looked at it as something in the way," said HAB's Kyriazis. Several observers gave Hanson and Ron Green - Fluor's second president - good marks for their interest in better community relations. Fluor's role in economic development. Relations between Fluor and the Tri-City Industrial Development Council have been somewhat chilly. But Wagoner, Hanson and Tom Patton, a TRIDEC senior vice president, said that relationship is improving. A fundamental issue has been who gets credit for new jobs coming to the Tri-Cities. TRIDEC has been the traditional coordinator of Tri-City economic development efforts. But Fluor - conscious that its contract with DOE sets quotas and performance fees for creating jobs -took the lead in its own efforts to attract new work. When new businesses and jobs materialized, it was difficult to determine who played the bigger role. "Who gets to claim credit can get in the the way of a lot of things," Patton said. Recent meetings led to Fluor agreeing to being a team player with TRIDEC in the coordinating role. "We folded Fluor Daniel into the community partnership," Patton said. Fluor's role is to provide leads on prospects to TRIDEC and to provide technical and marketing assistance. Turnover at the top. Stability at the top has not been a Fluor hallmark in its second year. The company has gone through three presidents in the past six months. Hatch left in May for a high-ranking post with the American Society of Civil Engineers. Then his successor, Ron Green, took a Texas energy company presidency about seven weeks after he replaced Hatch. Hanson, who was Green's hand-picked deputy, became the new president Sept. 3 after two months as acting president. Fluor Daniel Hanford also got a new executive vice president and a new vice president for environmental safety and health this year. Fluor Daniel Northwest - the biggest of Hanford's spin-off enterprise companies - will get its third president in slightly more than two years in December. The first two retired. DE&S Hanford and B&W Hanford each are on their second pres idents in two years. And Fluor Daniel Hanford's corporate parent - Fluor Corp. -got a new chairman, which prompted rumors that Fluor wanted to sell its Hanford contract. Fluor recently said it plans to stick with Hanford. "People were unsettled. Rumors were flying fast and furious," said Brown. Kyriazis added, "Every time you'd turn around, you'd see a new CEO at Duke or whatever." But Hanson believes the period of high turnover is past, and he and Wagoner are pleased with the new leadership team. They specifically listed Dave Van Leuven, who was Waste Management of Hanford's president. Waste Management posted a perfect record as a subcontractor in its first year. And Van Leuven was recently appointed executive vice president for Fluor Hanford, making him Hanson's No. 2 man. Wagoner, Hanson and others also optimistically point to DE&S Hanford working with Fluor to bring in new blood and overhaul management of the troubled spent fuel project. "I believe all this has given us a springboard to push forward," Hanson said. |
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