Evaluation Paper on Fluor Corporation

Paper Type:  Term paper
Pages:  7
Wordcount:  1756 Words
Date:  2022-04-11


Fluor Corporation was founded in 1912 as a construction company and has since diversified into FORTUNE 500, a multinational construction and engineering company with its headquarters in Irving, Texas. It provides services in diversified construction such as integrated engineering & design, procurement, fabrication, construction (EPFC), project management and maintenance solutions to its Clients globally (Flour, 2016).

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Success in the engineering and construction sector is guaranteed through the ability to innovate and implement the innovation. For Fluor to thrive in its industrial sector, it devised a concrete innovative strategy. It formulated a crystal clear metric known as the 'one 10 times'. That is, for an innovative idea to receive company support, it must be suitable for implementation in 10 different projects (Kraynek, 2017, 24). This metric as a guiding principle allows prioritization in terms of sustainability, client satisfaction, and engagement. Only ideas that are beneficial in multiple industrial platforms and improve project execution are given priority.

Viewing ideas through this metric allows the company to allocate resources to the most productive idea and encourages innovators to come up with ideas for repeatable solutions. They are empowered to reach across the globe to champion their ideas. Fluor has a very active innovation internal community and multiple collaborative partnerships. Ideas that sustainably address client needs are given first priority. Client partners are given the chance to directly challenge employees at the company annual innovation unwrapped event held every autumn. The event brings together clients and employees from across the globe, different disciplines and varying experiences and thus engage all facets of the company in coming up with creative ideas that enhance company growth for the future (Fluor.com, 2018).

Furthermore, innovation at Fluor is not limited to the R & D department or tech division. The company uses an inclusive approach where anyone with a brilliant idea can freely present it (Fluor.com, 2018). Fluor also launched upgraded systems to improve their application and use of IT (information technology) to collect and store its information. This improves its scope and database of relevant works and ideas that can be implemented to streamline its business (Newsroom.fluor.com. 2016).

The innovative strategy at Fluor has greatly improved service delivery, encouraged the emergence of creative and innovative ideas that have enabled it to thrive in the market. The decentralized strategy of coming up with innovative ideas motivated everyone within the company to think outside the box in coming up with ideas. Involving its diverse customers and employees across the globe has enhanced creativity through sharing ideas with people from different backgrounds, countries, cultures, and levels of experience.

Clearly, the strategy is effective. Recently, Fluor was awarded the "Fiatech's Celebration of Engineering and Technology Innovation (CETI) winner in the project planning category" for its integrated scaffolding solution (Fluor.com, 2018). In the Edison awards, it also received the bronze award for innovating, 3rd Gen Modular ExecutionSM in the innovation in energy and sustainability category (Newsroom.fluor.com. 2016)

SWOT Analysis of Flour Corporation Based on the Strategy


Being a market leader in its industrial sector, Fluor has a number of strengths that have enabled it to survive and thrive in the market.

It has a Strong Brand Portfolio - with over 100 years of service delivery, Fluor has refined and invested in establishing a strong portfolio that appeals to its clients. It has been named most ethical company for years.

Consistent suppliers - consistent suppliers of their raw materials have enabled the company to continuously deliver services without hiccups and avoid supply chain bottlenecks.

Excellent new market Performance - the company has a track record and expertise in scouting and penetrating new markets successfully. This has enabled it to expand and create new revenue.

Strong Cash Flow - adequate cash flow within the company allows it to diversify and bid for emerging projects.

Innovation - Fluor has been successful in coming up with brilliant products in the recent years that have positively impacted the community.

Diversity in the industry and geographically- Fluor offers several services to its clients such as project management, engineering, construction, energy, maintenance etc. it has also expanded from its borders to other countries globally.

Strong focus on sustainable infrastructure boosts its image and helps its client by providing eco-friendly and green solutions to their needs and quest of reducing the greenhouse effect.

The huge workforce of 56,000 employees globally drives the company productivity.

Fluor has a track record of project safety which is a crucial element of its corporate strategy.


The strategy involves selecting the best choice to enhance productivity and growth. A company has to improve on their weakness to gain an edge in the market and reduce vulnerability.

Low Investment in R & D (research and development) compared to other market giants. Although its expenditure in terms of R & D is above average, it is yet to effectively compete with the giants in the sector in relation to innovation.

The organizational structure of the company is not in line with the current business/corporate strategy thus limiting expansion and effective integration.

The company should invest more in new technologies to be at par with its vision and competitors.it will also help in their expansion process

The company is yet to counter challenges presented by new players in the sector thus losing its market share. It must devise effective feedback mechanisms to counter such challenges.

Litigations or lawsuits related to pending projects pose a risk to losing prospective clientele.

Fluor has a Limited global presence hence it relies mostly on the North American economy which can be counterproductive in case of high inflation or recession.


With the world turning green, Fluor should be on the forefront providing eco-friendly solutions to its customers and attract more customers.

E-Commerce - investing in online platforms creates new channels for revenue by attracting new online customers. Further investment will broaden its scope and improve the revenue channels.

Low inflation rate - allows market stability for the company's steady growth and also allows credit at lower interest rates.

The emergence of new technologies is an opportunity for Fluor to use differential pricing in the new market. This allows it to maintain loyal clients and also attract new ones

Diversifying into nuclear energy - usage of nuclear energy is expected to grow over the coming years as nations look for affordable sustainable energy sources in the long run.

Cementing its position in the renewable energy sector - this will make it a strong player in the sector as more and more people 'go green' and more governments promoting renewable energy.


The insufficiently skilled workforce in certain markets especially developing nations is a threat to Fluor's steady growth.

Inconsistent supply of innovative ideas/products - this reduces its capability to effectively compete with market players who continuously develop new innovative ideas

Raw materials are continuously reducing leading to increasing the cost that results in reduced profits.

Different countries have varying liability laws and this may expose the company to liability claims due to policy changes.

Stiff Competition from other players in the sector threatens Fluor corporation market share.

Government regulations - the company is subject to government regulations in terms of operation, safety, employment, environmental impacts, safety, anti-fraud, health and also taxes which it must comply with.

Market Evolution

Globally, the engineering and construction sector is facing a huge transformation as businesses shift to green technology and focus on sustainability. The digital economy is also evolving with better ICT technologies that will improve service delivery drastically emerging with each passing day e.g. AI technologies, design software etc. Over the next years, the engineering and construction sector will focus on sustainable technologies that will reduce environmental degradation and product loss. Fluor is likely to face more competition as more companies emerge looking to capitalize on that niche. Increasing importance of applying technology in construction creates a market for innovators. Furthermore emerging economies e.g. Brazil and China open up opportunities in the construction sector. Nuclear energy is likely to get a big boost in the prevailing economy with slight reductions in the oil and petroleum sector. Therefore the company is likely to incur profit drops in its oil business but gain profit in nuclear and other renewable energy sources.


To enhance its innovation, flour should fully embrace 'open innovation'. Basically, open innovation encourages a corporation/company to source out innovative ideas externally while conversely releasing ideas that don't fit its strategy externally to be used by others. Open innovation is more participatory and decentralized and is, therefore, a profitable way to innovate, cut costs on internal R & D, speeds marketing time for a product, creates new market streams and enhances differentiation in the market. The risk is also reduced as the company applies ideas that have been tested in other applications (Chesbrough and Crowther, 2006, 87).

The company should incorporate internet technology and networking to increase its access to open source ideas, enhance its communication and interaction with the consumer who can offer ideas on how to improve current ideas or come up with better ones. Furthermore, it will draw or include its customer's partners or suppliers in the process of innovation through online forums, online idea management etc. (Enkel, Gassmann and Chesbrough, 2009, 62).

Increasing partnerships with global construction giants globally in various projects and R & D projects creates a conducive platform for sharing ideas that improve service delivery, increase efficiency and cut costs (Hosseini et al., 2018, 54).

The limits that a market can accommodate lie with the company's ability to organize appropriately to benefit from innovation. Limits of tasks to be organized in the company and those that need to be controlled by the market always change with time. Innovations continuously pop up, the choices the company makes on how to benefit from them also change with time. However, a boundary will always exist between the market and the company. For Fluor Corporation to profit from its innovative activities, it must identify & negotiate the boundary, make an appropriate investment, take risks, acquire requisite specific complementary assets and effectively manage them. (Teece, 1993, 12)


Chesbrough, H. and Crowther, A. (2006). Beyond high tech: early adopters of open innovation in other industries. R and D Management, [online] 36(3), pp.229-236. Available at: http://web.simmons.edu/~weigle/INNOVATION/Chesbrough%20and%20Kardon.pdf [Accessed 20 Mar. 2018].

Enkel, E., Gassmann, O. and Chesbrough, H. (2009). Open R&D and open innovation: exploring the phenomenon. R&D Management, [online] 39(4), pp.311-316. Available at: https://www.alexandria.unisg.ch/57028/1/exploring%20the%20phenomenon.pdf [Accessed 20 Mar. 2018].

Fluor.com. (2018). Fluor - Creating Innovative Solutions. [online] Available at: http://www.fluor.co...

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Evaluation Paper on Fluor Corporation. (2022, Apr 11). Retrieved from https://proessays.net/essays/evaluation-paper-on-fluor-corporation

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