Presented by:

Robert L. Ibell: Past Chairman, British Tunnelling Society Chairman; London Bridge Associates Ltd

Partnerships, Collaborative Working &Integrated Teamwork

09:45 – 10:45Thursday 26th March 2015Warwick University

Today’s Agenda

Introduction and terminology

History & Development

The Benefits of working in a partnership

Key factors for success

Desired approach for working in an integrated team

Project case studies – the successes and failures of

working in an integrated team

1. Partnering – The development of a win/win relationship, based on trust and teamwork; partnerships involve the splitting of project liabilities and the sharing of rewards. Partnerships are a means of achieving best practice and TQM.

2. Integrated Teams – A combination of client representatives and suppliers selected to manage the design and construction stages of a project, and to plan for building maintenance. The theory is centred around the valued input from all members of the integrated team.

3. Collaborative Working – Similarly to partnering, the development of collaborative working environments involves the establishment of clear strategies, values and structures between organisations in order to achieve long term goals.

4. Strategic Alliances – A formal relationship between two or more parties with a common goal; it differs from partnering in that organisations remain separate throughout the process.

5. Supply Chain Partnerships – The development of a full chain of organisations responsible for the delivery of a project. Over time, organisations on the chain develop an aligned set of values and goals as their relationships develop (forming an Integrated Supply Chain).

Introduction - Forms of Partnership

Terminology Project (Tactical) Partnering – “a method of applying project

specific management in the planning, design and construction profession without the need for…third party involvement.”

R. J. Stephenson (1996)

Strategic Partnering – “a formal partnering relationship that is designed to enhance the success of multi-project experiences on a long term basis”

R. J. Stephenson (1996)

Facilitator – A neutral individual designed to assist with the organisation and running of initial project workshops and to provide advise on partnering where necessary. The facilitator has no executive function within the contract.

“The great revolution takes place in the mental attitude of the two parties…. is that both sides take their eyes off of the division of the surplus…. And together, turn their attention towards increasing the size of the surplus until it is so large it becomes unnecessary to quarrel over how it is divided. They come to see that when they stop pulling against one another and instead push in the same direction, the size of the surplus created by their joint efforts is truly outstanding.”

Frederick Winslow Taylor 1912

What is partnering?

What is Partnering –History of Partnerships and Teamwork

Partnering theory first developed in 1980s/ 1990s in North America, following lessons learnt from Japanese manufacturing industry.

Adopted in the UK construction industry in the 1990s following pressure from Clients who had learnt lessons from their own business developments – the concept was seen to provide greater levels of efficiency and resource than any single organisation could provide.

The Latham Report (1994) – Identified a series of inefficiencies within the UK construction industry and outlined the need for a greater level of partnering/ collaboration in order to improve.

Trusting the Team (1995) – The first report on how partnering could be applied to construction projects.

The Egan Report: Re-Thinking Construction (1998) – Provided a series of targets and steps to improve process in the construction industry.

The Latham and Egan Reports have been vastly more influential than others as they were written as advisory documents for the UK government.

The CIOB and other institutions have now written codes of practice relating to the use of integrated teams and partnerships in construction projects.

What is Partnering –History of Partnerships and Teamwork

• Then we started to call it collaboration and alliancing and we saw these type of arrangements beginning in the UK

• Now we have BS11000 and a gradual (not sure the DFT are yet convinced) move towards working together to reduce costs.

Potential Benefits to the Project

1. Increased project efficiency through a more harmonious and less confrontational work ethic.

2. Reduced chances of claims and litigation upon project completion

3. Allow better control of Project cost and programme via an open cost and cost predictability regime

4. Increased probability of delivery to time and budget

5. Allows better management of risk

Stakeholder Specific Benefits

CLIENT

•Reduced exposure to litigation•Lower risk of overrun•Better quality of product•Potential for time and cost reduction•Efficient resolution of problems•Lower administrative costs•Better opportunity for innovation•Greater opportunity for financial success.•Better management of all risks•Able to provide stakeholders with greater confidence in out come

CONTRACTOR

• Reduced exposure to litigation• Increased productivity• Expedited client decisions• Improved control over time and cost factors• Lower risk of overrun• Lower overhead costs•Better cash flow on most forms• Greater profit potential• Greater opportunities for future business.•More satisfied Client

CONSULTING ENGINEERS

•Reduced exposure to litigation• Reduced exposure to document inefficiencies through early identification of problems and their resolution.• Enhanced role in decision making• Reduced administrative costs• Greater profit potential•Enhanced communication and efficiency during design•Others take some greater responsibility for design and design information even if only moral responsibility•More satisfied Client

Influence of Procurement method.

• Behaviours and attitude

• Messages given out

• Selection of contractors

• Types of contractual arrangement Design and Build(D & B) Optimised Contractor Involvement(OCI) Incentivised Contractor Involvement(ICE) Early contractor involvement(ECI)

• Good vibes—Bad vibes

Influence of Procurement method.

Essentials for sound collaboration and minimisation of cost on a project

Shared and common objectives

Returns for all if things go well

Risk management Incentives(not bonuses)

No incentive to drive cost up

Every incentive to reduce cost

Trust and belief in the relationship and the team

Performance

Key Factors for Success at the Outset

Belief from all parties; all project stakeholders should be involved in the process, not just main contractors

Belief and commitment at all levels of the project team

Clear understanding of the benefits and the pitfalls

Commitment to being open, honest and truthful

An understanding by all parties of others key interests

A clear alignment of objectives at all levels

Approach to Partnerships/ Collaborative Working

All define their objectives and their interests Feasibility of success is agreed by all (note that this will

depend on a realistic budget) All parties must recognise the risks that may impact the

project as a whole, not just their own works Identify and require the behaviours that are required - be

prepared to change staff!!! Focus on best practice improvement targets and

performance to deliver these. Establish a forum to monitor the relationship Establish a right of referral to the forum from parties,

individuals, suppliers and sub contractors

London Bridge Station 1996 (£200m)

Not set up as a ‘partnering’ arrangement

Hard Contract but experienced staff

Good personnel relationship from outset

Delays due to Heathrow Express collapse

Worked together to get back on track

Applied for a Partnering award

Very satisfied Client

Jubilee Line Extension - C104

Ramsgate 1999 (£32m)

Early Partnering type contract using NEC

Client very open as to what he could afford

Very close integrated team working from outset

Staff integration, roles integration, open

administration

Full of VE, delivered to time and budget

Very satisfied Client

B

CTRL 240 – T200 Alliance 2004 (120m)

Target cost contract – quite benevolent

Establishment of a realistic target cost and a collaborative

working culture from the outset.

Shortly after commencement of works Team 200 alliance

(T2A) established. Four JVs in single alliance (£600m)

One cost, one target, shared rewards

Delivery ahead of time, on budget

Good safety record, record breaking performance

M25 Holmesdale (£70m)

Intelligent Client -Highways Agency under ECI contract—Quality Bid only

Design and construct, ostensibly all risk with contractor Some time spent in agreeing the budget( target cost)

because of poor estimating. Excellent relationships and complete openness from the

outset Client very clear on objectives and performance indicators Contract full of innovation and improvements

Delivery on time and to budget—follow on contract won

M25 Holmesdale Tunnel Refurbishment

Kings Cross Eastern Range (£65m)

Critical situation where contract heading for major overrun and delay to main project

Relationships were in trouble—designer was not performing, contractor waiting for information

Target cost incentive mechanism established and an integrated team set up

Contractor took over more and more management of the designer

Situation turned round—delivery to accelerated programme and beneath target cost.

Client delighted –project back on track