ADNOC unveils new ICV model to boost competitiveness and simplify supplier contracts

Abu Dhabi: ADNOC ICV is changing logo and is rewriting the rules for how suppliers compete for its contracts. At the Make It with ADNOC Forum in Abu Dhabi today, Senior Vice President of Commercial Affairs, Group Local Value and Industrial Development at ADNOC Salama Al Awadhi announced that registration will be 80 percent faster, with AI validating documents, and that the scoring model used since 2018 will be retired and replaced with a blended weighting.

“Effective from the 1st of November, we will retire H1, L1 and we will introduce a new ICV methodology, a blended weight where the commercial will represent 70 per cent and the ICV 30 per cent,” she said.

Under the old model, the supplier with the highest ICV score had to match the lowest price. Al Awadhi said ADNOC’s growth ambitions now call for something different. “We need a new model. That model needs to be simpler, faster, and the most important, more competitive,” she said.

Different contracts

Any contracts below 50 million dollars will be exempted from the ICV retention, and for contracts below 2 million are exempt from ICV requirements, she said, “because we want you to focus on where the ICV is.”

Contracts from 2 million to 50 million will use the new 70/30 model. For contracts from 50 million to 200 million, the 70/30 model applies together with an ICV improvement plan against the contract term. For mega projects above 200 million, suppliers will receive a customized ICV requirement based on the scope of the contract and must submit an ICV improvement plan.

Al Awadhi also said ADNOC will embed Local Plus in all its EBC contracts, as announced last May. Just before the forum began, a new batch of local manufacturers joined the Local Plus list, which now has more than 100 manufacturers.

ICV retention is now automated

ADNOC is also automating ICV retention. Suppliers no longer need to communicate by email or make manual entries.

“What you are going to need to do only is to upload your ICV certification, and the system automatically will give you your ICV obligation, and based on that, we will process for you the payments and by the way, it is live now.”

The same push for speed applies to supplier registration. Alawadhi said ADNOC has cut unnecessary approvals, documents and steps. Registration will be 80 percent faster, required documentation will be cut by 50 percent, and 60 percent of ADNOC’s services will be exempt from pre-qualification requirements.

“Instead of waiting for weeks to register, now you can register at the same day,” she said.

Suppliers will no longer need to move between multiple platforms. Registration, due diligence and pre-qualification will all be in one place, and suppliers will only need to register once. AI will also play a role. “AI will be embedded everywhere to validate any document you are uploading,” she said.

The old logo is retired

The changes also come with a new look. Alawadhi reminded the audience that the old ICV logo has been part of the program since 2018.

"This logo started with us. This logo lived with you within your premises, within your signatures, and also within your stance in every event. The time has come to retire this logo and shift to a new identity,” she said.

Built with the market

Alawadhi said the changes are the result of dialogue with suppliers.

“In the past couple of months, we met our partners, our suppliers, our manufacturers. You told us exactly what went well, and you were very transparent with us of what we need to improve, and simply we listened,” she said.

“It was not a decision made by us in ADNOC alone. It is a decision made together with you.”

The forum featured speeches from Hassan Jassim Al Noez, Under Secretary of the Ministry of Industry and Advanced Technology, Omar Abdulla Alnuaimi, Group Chief of ADNOC's Commercial & In-Country Value Executive Function, Senior Vice President of Commercial Affairs Group Local Value and Industrial Development at ADNOC Salama Al Awadhi and Senior Vice President of Group Commercial Operations & Execution at ADNOC, Adel Al Yafei.