infrastructure projects 03 dec 2015cost planning briefing to commercial directors forum1 cost...
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03 Dec 2015Cost Planning Briefing to Commercial Directors Forum3 Cost Planning & Estimating Scrutiny Network Rail recognises that there were shortcomings in aspects of the Strategic Business Plan submission that informed the Final Determination for CP5 with regard to the forecasting of funding requirements for the enhancement and renewals programmes. Network Rail believes that simplistic perceptions around the ‘… inability to Estimate …’ misrepresents the complex dynamics of early forecasting of railway schemes which is actually a matter of improving consistency in scope development and control, cross functional culture and engagement, service provision and governance and the level of subject matter resource, data and supporting IT systems. A credible Cost Planning Improvement Plan has been developed by Network Rail, scrutinised by the ORR and is being deployed. Network Rail and industry support for this plan is evident. It will transform Network Rail’s capability with regard to CP6, addressing the shortcomings of the preceding Control Period. Message from Mark Carne – Chief Executive, Network Rail – to Secretary of State for Transport (Patrick McLaughlin) July 2015TRANSCRIPT
Infrastructure Projects
03 Dec 2015 Cost Planning Briefing to Commercial Directors Forum 1
Cost Planning Improvement Plan
Awareness Briefing
to
Commercial Directors Forum
03 Dec 2015Cost Planning Briefing to Commercial Directors Forum
2
Cost Planning & Estimating Scrutiny
Dame Colette Bowe (‘… the Bowe Review …’) is looking at what lessons can be learnt from the planning of the Control Period 5 programme in
order to improve future rail infrastructure investment. This will be in the autumn of 2015. Sir Peter Hendy, Chairman of Network Rail (‘…
the Hendy Review …’) is looking at how the current investment programme can be put
back on a sustainable footing that is deliverable and affordable. This will be in the
autumn of 2015.Nicola Shaw, CEO of HS1, (‘… the Shaw Review …’) is looking to the future: advising the government on how it should approach the future shape and financing of Network Rail in the longer term. This will be in the spring of 2016 in time for the 2016
Budget.
Her Majesty’s Government has recently commissioned three pieces of work looking into Network RailJune 2015
03 Dec 2015 Cost Planning Briefing to Commercial Directors Forum 3
Cost Planning & Estimating Scrutiny
Network Rail recognises that there were shortcomings in aspects of the Strategic Business
Plan submission that informed the Final Determination for CP5 with regard to the
forecasting of funding requirements for the enhancement and renewals programmes.
Network Rail believes that simplistic perceptions around the ‘… inability to
Estimate …’ misrepresents the complex dynamics of early forecasting of railway schemes
which is actually a matter of improving consistency in scope development and control, cross
functional culture and engagement, service provision and governance and the level of subjectmatter resource, data and supporting IT systems.
A credible Cost Planning Improvement Plan has been developed by Network Rail,
scrutinised by the ORR and is being deployed. Network Rail and industry support for this plan
is evident. It will transform Network Rail’s capability with regard to CP6, addressing the
shortcomings of the preceding Control Period.
Message from Mark Carne – Chief Executive, Network Rail – to Secretary of State for Transport (Patrick McLaughlin)July 2015
03 Dec 2015 Cost Planning Briefing to Commercial Directors Forum 4
Cost Planning & Estimating Governance
‘… I want ….. ‘… Cost Plans / Estimates produced
by competent individuals / organisations and approved by
IP Head of Cost Planning …’
‘… Cost Plans / Estimates formatted correctly in a national consistent
manner (Rail Method of Measurement compliant) withappropriate risk – similarly for
programmes with key assumptions,milestones, critical path identification
and resources …’
‘… to increase ourgovernance and control in regard to our
responsibilities within early GRIP stages ofdevelopment. I want controls in place whereby
our IP Regions still provide a service to theirRoute Sponsors / Clients but I want central
governance and assurance providing certainty that
what is produced is appropriate for the particular stage of a project’s development …’
‘… Cost Plans / Estimates and Programmes base lined and a
clear change controlprocess / governance in place
…’
Message from Neil Thompson, IP Commercial & Development Director3rd September 2015
/03 Dec 2015 5
Cost Planning Improvement Plan – Workstream
The levels1. Basic2. Room for Improvement3. House in order4. Best practice5. Leading edge
PEOPLE PROCESS SYSTEMS & DATA # ESTIMATING CAPABILITY
# = STAKEHOLDER ENGAGEMENT
1 23 456 7
1 6 3 2 5 4 7
PRIORITIES:
1. Resources: Establish an HQ service capability with a team of practitioners.
Increase the Regional team capability and service offering2. Systems and Data:Develop and deploy an integrated IM strategy to support UCM and
Benchmarking (RCIS), National Rates Database (NRD) and a single corporate Estimating Tool of Choice (EToC) with ‘Service KPIs’
• Rail Method of Measurement (RMM):Establish the RMM across the industry as business as usual2. GRIP Outputs:Improve the discipline for GRIP deliverables from stakeholders
5. Early Engagement:Develop a National Cost Planning Service to support GRIP
Stages 0 to 36. Governance:Provide assurance and hold practitioners, clients and
consultants to account7. Scope Alignment / Control:Reconciliation of scope development through change control
of Cost Plans throughout GRIP Stages 0 to 88. Whole Life Cost:Deploying and integrating Whole Life Cost and Life Cycle
Cost into the Cost Planning and Estimating discipline
03 Dec 2015 Cost Planning Briefing to Commercial Directors Forum 6
The art of Estimating
03 Dec 2015 Cost Planning Briefing to Commercial Directors Forum 7
Questions