Panama Canal Authority

“Three, two, one! HAPPY NEW YEAR!” Celebratory cheers echo across the globe as the clock strikes midnight, marking the end of a century and the start of a new time in history. The date is January 1st, 2000, and the United States of America’s first New Year’s resolution has already been fulfilled. As of 12:00 am EST, control of the Panama Canal officially returned to the Republic of Panama—a transfer of power decades in the making.

With construction of the Canal beginning in 1881, 2000 is the second turn of the century the Canal has seen. At its inception, the Canal project was one of the largest and most complex works of engineering that the world had ever known, and it was about to get even larger.

The Project of the Decade

An undertaking of this magnitude demanded continuous risk evaluation and project oversight by a multidisciplinary audit team. The Office of Inspector General (OIG) for the Panama Canal Authority formed its Expansion team with staff that had years of experience in project and construction audits. However, no one had worked on a MEGA project. Thus began the search to fill this gap. The Board of Directors emphasized that they expected the OIG to identify and report on significant risks that would impact the schedule, cost, quality and transparency of the $5.2 billion project. To meet this directive, the OIG sought a firm that would assist and advise the Expansion Team led by Elsa Jaramillo, be the Board’s eyes and ears, and provide the assurance that these risks were being properly addressed.

The OIG Canal Expansion team needed more than an advisor with ample experience in engineering, project management, and megaprojects. They sought a partner who was willing and able to provide on-the-job training, and be in the trenches with the team. That’s why the Canal chose Talson Solutions. Back then, Talson competed with larger, more well-known firms, but Talson showed they clearly understood the Canal’s need and offered the winning proposal. With that, Talson began a journey that changed their future, earning their small firm a responsibility of unparalleled scale and worldwide significance. The client was not just a Board of Directors but the citizens of Panama who voted to fund the Expansion.

The Small Firm Makes a Big Difference

Talson compensated for its size with its multifaceted understanding of the task, vast knowledge, and almost round-the-clock availability, devoting every resource to the Panama Canal Expansion. In the thick of the project, Talson’s own founder, Robert Bright, found himself spending more time on Canal-related work than the rest of Talson’s work combined. Talson’s efforts did not go unnoticed as early in the timeline, a significant risk was elevated to the Board’s attention.

Shortly before a high-level leadership meeting at the start of year one, Bright received a last-minute request to attend. He dropped all that he was doing to join as a listener for half of the scheduled meeting time. Jaramillo recalls that the advisory report from that meeting left

its mark for the remainder of the project. The report disclosed that the inactivity of a primary international contractor jeopardized the budget and schedule. As often happens with audit reports, the content was unpopular and criticized, but time proved that OIG/Talson highlighted a risk that would require continuous augmented oversight by the Canal’s project management team.

Every subsequent audit report addressed the status and management of this contractor risk. Talson’s judgment and recommendation for early and timely corrective actions proved to be on target. The incident highlighted Talson’s knowledge and experience, proving the tremendous value they could bring to the project. To paraphrase Jaramillo’s words: Talson consistently pointed to the risks that mattered, to those that should be in the spotlight and be closely monitored.

Talson, Panama, and The World: Relationships Revered

China, France, Spain, Italy, South Korea. Working together as one team, the Talson and Canal staff traveled the globe to establish communication with various managers, contractors, and suppliers—reviewing the myriad elements of the project. Together, the two teams identified cost risks, quality risks, schedule risks, and every risk of note they came across, growing pridefully close along the way. Talson adopted Panamanian culture, fully embedding its people in Panama, and the Canal audit team came to recognize the Talson members as friends as well as partners.

Beyond risk assessments, readiness reviews, quality audits and more, Talson provided the Panama Canal Authority with valuable recommendations, training programs, and system improvements wherever sensible. On one of the many instances in which Talson exceeded expectations, Bright agreed to attend events in Washington, DC. Alongside the Ambassador of Panama, he would speak to the public about the details of the project. From added scope tasks to personal celebrations and more, the firm made sure to always be there for the Canal and Panama—with an unmatched reverence for the relationship.

Talson’s extraordinary respect for all people and unique ability to appreciate the nuances of dynamics empowered the team to do more than work exceptionally well together; it empowered them to work exceptionally well with a range of professionals from all across the globe. The mix of contractors on the project came from different backgrounds, spoke different languages, and knew different cultures, but Talson proved to be the perfect partner to guide the Canal’s internal audit team on how to address them all.

Eight Years of Excellence

The Panama Canal Authority goes to great lengths to preserve transparency in all procurement, selecting free and open competition as the preferred procurement process. Talson’s first contract was awarded for one year, and normally would have required another full and open competitive process. However, the Canal acknowledged that changing the OIG’s advisory firm would mean losing time and knowledge. Furthermore, Talson had proved they were essential for the continuous audit of the Expansion Project. Jaramillo explained that Talson’s continuity on the project could be amply justified because of their “excellence in reporting, knowledge sharing, technical matters, transparency, reliability, and availability.” As a result, Talson remained on the Panama Canal Expansion for eight years, always maintaining the same level of excellence and commitment.

After approximately 15,000 Talson man-hours, over 100 Talson reports, and over 100 stamps on Robert’s passport, the expanded Canal was inaugurated in June 2016. Since its opening, the Canal has surpassed traffic expectations, offering countless ships a shorter route that offers greater cargo capacity, and reaffirming its place as an environmental leader. The project went on to receive the Newsmaker of the Year award by the Lloyd’s List Americas Awards, in recognition of the historic inauguration of the Neopanamax locks.

Back in 2000, when Panama assumed control of the administration of the Canal, the leadership faced the challenge of infusing Panamanian culture into the Canal, which had been a US federal government entity until that time. Once the Expansion Project was completed with exceptional teamwork and met with worldwide acclaim—the question became how to infuse the culture of the Canal into Panama.

“They put on their Panama Canal hats and they put their heart into it… I can’t imagine a scenario without Talson.”

– Elsa Jaramillo

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