National Commercial Directors ForumDay 2 Supplier Performance Metrics
4th December 2015 26-Apr-17 Stephen Blakey, Commercial Projects Director, Infrastructure Projects
Welcome Back Stephen Blakey, Commercial Projects Director, Infrastructure Projects Todays Agenda Friday 4th December
Time Session Name Session Hosts 08.30 Coffee and Seating 08.45 Supplier Performance Metrics The Vision Stephen Blakey 09.00 Supplier Performance Metrics Central Regions Journey Rob Offord, Sean OBrien & Colleagues 09.45 Break Out Session 1 Obstacles to Successful Deployment 10.15 Panel Q&A Central Team 10.30 Coffee 10.50 Break Out Session 2 Solutions to a Successful Deployment 11.20 11.30 Break Out Session 3 Action Planning 12.00 12.15 Open Forum 12.30 Next Steps 12.55 Summary & Close 13.00 Lunch (Restaurant) / Depart 26-Apr-17 Todays Objective To fully understand the proposition what, why, when, how & the impact to date To acknowledge the potential blockers And learn from the Central Teams experience To identify the solutions To develop a credible action plan And be guided by the Central Teams experience To reach consensus on what needs to be done to hit the April 2016 target Supplier Performance Metrics The Vision
Stephen Blakey, Commercial Projects Director, Infrastructure Projects (08.45 09.00) Context: Supplier Performance
Francis Paonessa,IPs ManagingDirector is theSenior ExecutiveResponsible for ourSupplierPerformanceManagement Executive Sponsorship Supplier Conference: Breakout Sessions
Collaborative Working (G1 Blue E13) Structured Continuous Improvement (G2 Green E9) Consistent Performance Measures (G3 Yellow E1) The need to betterdefine, identify andnurture collaborativebehaviours topromote consistencyacross the supplychain The need to ensurethat improvements insafety, efficiency anddelivery areimbedded in ourindustry The need to bringgreater consistencyin what we do and theprogress we aremaking throughcommon metrics &measures Communicate more, especially face-to-face meetings Health & Wellbeing (G4 Red E11) Our ongoing commitment to support the health & wellbeing of our industrys people Consistent Performance Measures/Metrics
Q1: Do you think that a common set of Performance Metrics will improve our performance & be beneficial to NR and suppliers? No and I see no benefit in doing so No because I can see some real dis-benefits to our business Yes I can see the benefits and would likeNR to define what they want to measure& how Yes I can see the benefits and am happy toparticipate in the development /refinement of processes & metrics 0 / 220 Consistent Performance Measures/Metrics
Q2: If NR builds from existing metrics and works with suppliers to establish a broad consensus, a National set of Performance Metrics could be deployed in? 3 months 4-6 months 7-9 months 10-12 months It cant be done by consensus NR should develop a set of metricsand deploy 0 / 220 9 Context: Where are we now
The 2013 CP5 National Supply Chain Strategy committed to industry collaboration IP has procured 85 key frameworks Most of these allow local development of KPIs/KRAs & incentives to drive performance 80 Frameworks make use of target cost & pain/gain to incentivise vfm & cost control. KPIs & KRAs are now established across 58 frameworks covering 6.5bn Performance against these KPIs moderates gain Local KPIs/KRAs have common themes & align to corporate, programme & project priorities Building on best practice, a national approach to a standard set of KPIs/KRAs is being developed These KRAs are 1 of 4 performance dimensions Supplier sentiment positive to national approach We recognise the ongoing challenge in demonstrating the benefits of collaboration In particular illustrating improved performance Supplier Performance Metrics The Vision
11 11 Supplier Performance Management - 60 second Brief
The need forchange (The ProblemStatement) KPIs have been developed locally for many of our Frameworks & Alliances. Whilst they reflectcommon themes, they do not have common or consistent definitions, methodologies or ITplatforms. This prevents NR in forming a view on a like for like basis of the respectiveperformance of our suppliers and inhibits our ability to promote structured continuousimprovement. What goodlooks like (The Solutions) One national set of performance dimensions (Key Results Areas) supported by a standard suite ofKey Performance Indicators, with consistent definitions, business process (data gathering andcalculation methodologies) and systems (IT platforms, data gathering and reporting systems) thatallow like for like performance comparisons that support the structured continuousimprovement of our suppliers . How will weget there?(Deployment) By the national deployment of a successful performance management regime piloted in CentralRegion. Building on the experience & lessons learned from the Central team (NR & its Suppliers)and identifying the People, Process & Systems issues to be addressed in support of establishing anational set of performancemetrics by April Running these metrics in parallel to existingKPIs (with no fiscal impact) for a minimum of 6 months prior to the phased & negotiated swapout of the old for the new. Key themes RASIC Project Contacts Supplier Performance Metrics Central Regions JourneyNetwork Rails Perspective
Rob Offord, Sean OBrien & Colleagues Central Region, Infrastructure Projects (09.00 09.25) Network Rail Supplier Performance Framework Supplier Metrics Objectives of this session; Provide a full understanding of IP Centrals Supplier Metrics Model Why do it? What is it? How does it work? What she impact to date? Reasons for the Supplier Performance Framework
Efficiency, productivity and quality meeting the performance criteria will encourage measurable continuous improvement. Encourages a high performance culture. Set the standard - achieve a high standard across all aspects of project delivery and to apply this consistently within IP. Opportunity to improve through facilitated sharing of best practice and lessons learnt. Benchmarking supplier metrics drive innovation and will therefore encourage the bringing of excellence from other sectors. Performance comparison - to enable objective review and comparison of our suppliers performance, and the collaborative development of robust improvement action plans. Supplier Performance Framework - Structure
Health & Safety Design Management Commercial - Behavioural Safety - Life Saving Rules - Health & Safety Assurance - Occupational Health - Accidents & Incidents - Building Information Modelling (BIM) - Approach to Design - Delivery of Design - Development & Management of Target Cost - Management of Estimated Final Cost (EFC) - Strategic use of the Supply-Chain - Cost Capture & Verification - Commercial Close Out Programme Management Quality Continuous Improvement/Innovation - Opportunity & Risk Management - Integrated Scheduling & Access Planning - Integrated Progress Measurement & Reporting - Handback & Close Out - Quality Management Planning & Process - Quality Management System - Competency & Capability - Inspections - Audits - Idea Generation - Continuous Improvement - Innovation Collaboration & Behaviour Sustainability Customer & Stakeholder Management - Behaviours - Collaboration - Communication & Engagement with Staff - People - Procurement, Sourcing & Resource Usage - Pollution & Waste - Leaving a Legacy - Environmental Assurance - Environmental Risks & Incidents - Community Liaison - Third Party Approvals 9 KRAs 31 KPIs 109 Performance Measures (under review) (10th NR Feedback survey)) Supplier Performance Framework - Structure
KPI Applicability Lead KPIs (54 total): When Measured? Every Quarter Lag KPIs (55 total): When Measured? Every Period Consistent close call reportingprocess across the lot, including how theresulting data and trends are used toimprove safety performance. Example evidence: Company wide closecall reporting process 1.1.6 Number & quality of Health& Safety Close Calls reported Close out of Close Calls Example evidence: Site specificclose call data Maximum applicable measures: GRIP stage 1 2 3 4 5 6 7 8 (Lead & Lag Period) 18 30 40 45 68 88 76 10 Lag only 15 29 49 37 Supplier Performance Framework - Structure
19% Supplier Performance Framework - how does it work?
Assessment process by supplier and KPI Review Team Who: Supplier KPI Coordinator When: Week 1 & week 2 of following Period. Supplier self-assesses scores against each applicable measure Who: T&T KPI Review Team When: Periodically & Ad hoc as required Performance information used in SAM meetings. Bi-monthly Action Improvement meetings. Bi-Annual Supply Chain Best Practice Forum Who: Supplier KPI Coordinator When: Friday week 2. NB: All evidence to substantiate stretch & excellence submitted Reports produced to inform performance improvement activities. Supplier submits Period scores online to KPI Review Team. Who: T&T KPI Review Team When: Week 3 This stage frequently requires communication between KPI Team & Supplier to ensure accuracy of scoring. T&T KPI Review Team review, challenge & validate supplier self-scores. Who: T&T KPI Review Team & Supplier KPI Coordinator When: 2 hour meeting week 4 Periodic Review meeting to confirm agreement of scores. Supplier Performance Framework - how does it work?
Score levels determined by defined criteria Excellence (120) -Incentivisation for operatives to provide suggestions to solutions to breaches of Life Saving Rules -Schedule of workshops to take place with all personnel, subcontractors and materials suppliers to review compliance to Life Saving Rules on sites, put action plans in place, and to share across supply-chain Stretch (100) Performance Improvement -Campaigns and communications in place to drive continuous safe behaviour Expected (0) Contractual & Commercial impact Below Expected (-100) -Up to date plan for delivering Life Saving Rules training for all personnel -Up to date plan to embed Life Saving Rules into toolbox talks and engagement conversations - Does not meet all of the requirements for 'Expected' level The performance levels can be characterised by generalised themes. Performance Improvement
The Supplier Performance Framework is a platform for driving best practice across the CP5 lots through collaboration. Action Improvement Meetings (Bi-Monthly) Improvement actions are focused on areas of under performance. The contractor functional lead is accountable for all improvement actions within their area. These actions are reviewed at agreed intervals to ensure progress is on track. Best Practice Forums (6 monthly) A collaborative and integrated forum. Suppliers share Best Practice and improvements. Standardisation of similar processes to increase efficiency. (eg LSR test) NR Enablers Measurement of NR activity to enable more effective contractor delivery, as measured under CP5 Panel/Programme contract KPI frameworks REMIT: Which of the project life cycle areas can NR affect most influence on successful outcomes for the contractorsdelivery? Whether it is currently measured or not, what activities and performance should NR monitor and improve upon? 1st time doing this, so start small with a few, and monitor. Over time we will better understand dependencies oftrue performance improvement. This is WORK IN PROGRESS. Outputs and Reports Performance Trends Lead & Lag periods Improvement in Lead policies & processes is driving improvement in Lag performance Notable Improvements: This slide to list a small number of notable issues that have improved since we started the KPI monitoring process. Supplier Performance Metrics Central Regions JourneyThe Suppliers Perspective
(09.25 09.45) CP5 Contractor Perspective
KRA/ KPI Review CP5 Contractor Perspective Initial Thoughts Murphy KPI Timeline Appoint an overall manager in charge of KRAs
Appoint leads for each area of the KPIs Investigate current processes and policies Benchmark current maturity levels against KPI requirements Create a business case with associated timescales for achieving Expected, then Stretch, then Excellence Senior Manager holds regular review meetings with the leads to ensure progress is on track VolkerRail KPI Timeline
Benchmark position at award (0) and position that could be achieved without major investment (70) Appoint a Senior Business Manager to Lead each KRA Processes and Standards reviewed and amended Introduced new processes and procedures where none existed (Bright Ideas & Collaboration Maturity Assessments) Create an action plan for each year. Appoint an KPI Analyst to identify opportunities & drive improvement Story KPI Timeline Appoint Senior leader to take ownership of KPIs for the Rail business Undertake a review of Story process against KPI requirements Set improvement targets against KRA by individual KPI Appointed KRA Champions to lead improvement plans Lead to review and improvement of existing processes in a number of areas Benefits so far Murphy Apps commissioned
Contractors collaborating much more openly Strengths & Weaknesses Identified New processes and systems introduced addressing value engineering, innovation, risk, collaboration Benefits so far Review of existing process has lead to improved processes in a number of areas Now reviewing additional business process to looking at Process and System improvement Any questions? Break Out Session 1 30 minutes
Obstacles to successful deployment 1) Identify a scribe (use the flip charts) 2) Discuss in your table groups the key blockers to achieving the objective 3) How could this initiative be sabotaged, by who and why? Be ready to discuss in open forum and challenge The Panel (09.45 10.15) 35 35 Panel Q&A Central Team Obstacles to successful deployment
(10.15 10.30) Coffee and Conversation
( ) Solutions that support a successful deployment
Break Out Session 2 30 minutes Solutions that support a successful deployment 1) Identify a scribe (use the flip charts) 2) Discuss in your table groups the key solutions to achieving the objective 3) How could this initiative be supported, by who and why? 4) What personal contribution can you make? Be ready to discuss in open forum and challenge The Panel (10.50 11.20) 38 38 Panel Q&A Central Team Solutions that support a successful deployment
(11.20 11.30) Break Out Session 3 30 minutes
Action Planning 1) Identify a scribe (use the flip charts) 2) Discuss in your table groups the key actions necessary to meet the objective 3) Schedule out the key milestones as you see them Be ready to discuss in open forum and challenge The Panel (11.30 12.00) 40 40 Action Planning Panel Q&A Central Team (12.00 12.15) Open Discussion (12.15 12.30) Do you support the objective?
What are you personally going to do to promote & support this? Do you support the plan? Who does this need to be syndicated with in your business Who could help us? What are you personally doing to promote RSC? What have Network Rail done? Have you got any best practice to share? Tier 2 representative feedback Voting button yes/no in favour of each recommendation (12.15 12.30) 26-Apr-17 Next Steps (12.30 12.55) Stephen Blakey, Network Rail
Summary and Close Stephen Blakey, Network Rail (12.55 13.00) Thank You and Safe Journey Home..