Stansted Airport Development: a case

study

Paul Weller

A general description of construction project manage- ment arrangements for the Stansted Airport Develop- ment is given. This involves organization of a team of resident managers and employing a consultant contractor for advice. The design team and those re.~ponsibIe for actual constru&t~on are selected from the point of view of client objectives with regard to quality/performance, cost, and financial budget. Through a sertes of questions and answers pertaining to the actual project, the various factors relevant to its successful outcome are established.

Keywords: project management, construction, con- tractors, design, performance, cost

The existing international airport at Stansted is a modest facility - albeit with a capacity of up to two million passengers per annum.

In June 1985 the Government granted outline permission for the development of Stansted to handle fifteen million passengers a year but starting with a first phase of eight million.

It is this first phase which is currently being developed - the scope of which includes:

l A new road system from Junction 8 on the Ml1 to the new Terminal Building.

l A short-term car park and coach station will directly adjoin the Terminal. Long-term car parks are located adjacent to the new approach roads.

Laing Management Construction Ltd. Management House, Alma Street, Luton, Bedfordshire LUI 2PL, UK This paper was presented at a seminar on ‘Construction project management organized by Deloitte Haskins & Sells and Legal Studies and Services Ltd in conjunction with the Association of Project Managers held in London. UK on 21-22 October 1987

A rail link from the existing London-Cambridge line, which tunnels under the existing runway and terminates at a station directly under the Terminal Building. The existing runway will remain unchanged. It has a long-haul capability and sufficient capacity to accom- modate traffic levels well beyond those of the new terminal. A new taxiway system will connect the runway to the Terminal apron, cargo and aircraft maintenance zones. An aircraft parking apron will serve the Terminal capable of accommodating the total range of aircraft _ including new, larger aircraft, not yet in produc- tion. Access to the Satellite Buildings on the aprons for boarding or disembarking from the airport will be via an automated Tracked Transit System that conveys passengers between the Terminal Building and the Satellite Building. A two-storey terminal building designed by the architect Norman Foster is designed to give an overriding impression of ‘light and airiness’. The tree-like structural steel framework will be seen from inside and outside and will give the terminal a distinctive identity. Extensive landscaping and a range of ancillary and infrastructure works to service the development.

A few key statistics to demonstrate the size of the development are detailed below:

l access roads equivalent to 25 km to single-track road, l 6M cubic metres of balanced cut and fill earth-

moving, l apron and taxiway pavement areas totalling 666 000

m*

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l trunk drainage includes 5.5 km of drainage runs over 1 m diameter

l volume of concrete including PQ, dry lean, and structural concrete totals 645 000 m3

Construction work currently completed or underway includes:

l Preliminary access roads and earthmoving to allow construction traffic direct access from the Ml1 onto the site.

l Balancing pond at the south side of the site to cater for surface water run-off. Trunk drainage runs from the balancing pond to the Terminal Building and pavement areas. Earthmoving and roads airside of the Terminal Building. Phased construction of the long-term car parks. The Terminal Building itself is now taking shape. The water table within the underlying Kesgrave gravel beds has been dropped by a number of pumping wells. Mass concrete foundations have now been completed to allow erection of the structural steelwork. A trial structural steelwork ‘tree’ has been erected prior to main erection to iron out potential problems associated with temporary guying back the ‘tree branches’ prior to installation of the Macalloy bars and their prestressing in stages to a total of nearly 80 tonnes.

The maximum area of roof decking is being fixed at ground level to the structural steelwork roof domes to reduce the amount of work required at roof level. Valley decking between the domes is currently taking place with the roof insulation and single- membrane roof lining closely following. Installation of the continental type UV roof outlets and associated plumbing work is to commence shortly.

Following roof installation, the concourse-slab concrete works is constructed having the benefit of protection from a substantially completed roof.

External cladding work is due to commence early next year. Bored piling for an 11 m high anchored retaining wall to support the elevated forecourt due south of the Terminal Building is currently under construction.

GENERAL DESCRIPTION OF PROJECT MANAGEMENT ARRANGEMENTS

I Who is managing the project as a whole on behalf of the client? The overall project management of the development is undertaken by the Stansted Development Team who are resident on site. This team is employed directly by the client (Stansted Airport Limited) and consists of approximately six managers, headed by David Williams, the Development Director.

The Stansted Development Team employs the re- sources of Laing Management Contracting in their role as Consultant Contractor for advice/input on any construction matters. The specific responsibilities of the Consultant Contractor being:

l programming and monitoring for all the development ment

packaging of the works procurement input commercial assistance common site services industrial relations and safety ‘buildability’ and technical input information control

Who is responsible for design and upon what sort of n appomtmentc The responsibility for design and quantity surveying aspects lies with British Airports Services Ltd (BAS Ltd) who in turn employ other external design con- sultants and quantity surveying practices to cater for peaks in workload and specialist areas.

For practical purposes, the design of the develop- ment is split into three separate areas under three separate lead designers:

l Infrastructure works - BAS Ltd (EC2 dept) l Terminal Building & Satellites - Foster Associates l Tracked Transit System - BAS Ltd (EM2 dept)

The external consultants employed on the development are :

Terminal architecture Terminal structure Civil engineering

Landscaping Ecology Mobile homes park Quantity surveying

Construction management

-Foster Associates - Ove Arup & Partners - W S Atkins & Partners - Early, Campling, Lee &

Partners - Balfours - Ground Engineering - Air BP - Adrian Lisney -Penny Anderson - Melville Dunbar - Beard Dove - Corduroy - SBW - Currie & Brown - Laing Management

Contracting

The relevant types of design appointments are:

Client with BAS Ltd - informal arrangements based on intercompany agreements. BAS Ltd with Foster Associates - deed of appoint- ment drafted by BAS (loosely based on RIBA Standard Form). BAS Ltd with Ove Arup & Partners - formal agreement based on ACE Standard Form on Condi- tions of Engagement - modified by BAS. BAS Ltd with PQSs and Civil Consultants - personal agreements to provide assistance to BAS Ltd.

Who is responsible for management of construction as a whole and upon what sort of appointment? Management and supervision of the Terminal Building and Common Site Services for the development is undertaken by Laing Management Contracting in our role as Construction Superintendent. The exception to this being the supervision of the Baggage Handling

134 Project Management

Equipment which is to be supervised by a specialist department within BAS Ltd (EM2).

Laing Management Contracting’s dual role of both Consultant Contractor and Construction Super- intendent is based on a special form of agreement with Stansted Airport Ltd. The agreement defines the responsibilities for both roles and fixes hourly rates (inclusive of fees) for the various categories of staff to be employed by Laing on the development.

Management and supervision of all remaining works, i.e. Infrastructure works, Tracked Transit System and Satelite Building is undertaken by British Airports Services Ltd’s Resident Engineering Staff, their appointment being based on intercompany agreements.

4 Who is responsible for actual construction and upon what sort of appointment? There are currently approximately 300 work packages identified for the development to date excluding Supply Only Items. Each package is competitively let to main or specialist contractors by British Airports Services Ltd.

The work packages are split into the following areas:

l Infrastructure - 150 packages l Terminal Building/Satellite - 120 packages l Common Site Services - 30 packages l Supply Only Items - 200 packages

The forms of contract currently in use are detailed below:

(a) JCT ‘63 (Standard Form LA with quantities) o Terminal Building 0 Satellite o Lifts/Escalators

(b) JCT ‘81 (Design and Build) o Cargo warehouse

(c) JCT ‘84 (Intermediate Form - IFC 84) o Mobile homes park

I I

(d) ICE ‘73 Civil Engineering Construction o Major infrastructure works

(e) 516B - BAA Small Works o Minor civil works

(f) I Mech E Model A Form Mechanical Contracts o Baggage handling equipment

(g) IEE Model E Form Electrical Contracts o Cabling and Switchgear

A simplified management structure of the Stansted Airport Development is shown in Figure 1.

DETAILED DESCRIPTION OF PROJECT MANAGEMENT ARRANGEMENTS

I What is the relative importance to the client of the following three aspects of project management?

l performance/quality of development l cost 8 overall programme duration

The three primary aspects of project management control are referred to by the development team’s director under the algebraic formula ‘P3’ which stands for ‘product, programme and price’, the fundamental priority being price.

Product and programme are important issues that are monitored and controlled rigorously, but the overall price takes priority on the same basis as most house- hold budgets - if the money is not available you cannot buy the goods.

2 Is the client seeking to maximize performancelquality and minimize cost and time or are there actual targets for each of these? Our interpretation of the client’s requirements is that he seeks to design and construct an airport that is ‘fit for purpose’ and within his financial budgets and programme constraints.

BAA plc

Stansted Airport Limited British Airports Services Limited

- . . . . . . . . . . . . . . . . . . . . . Stansted Development Team Designers

Quantity Surveyors Purchasing Site Supervision

Laing Management Contracting Limited

Terminal Building Designers External Designers External PQs

Consultant Construction Architect-Foster Associates (as appropriate) (as appropriate)

Contractor Superintendent Structural Engineer-Ove Arup

and Partners .

Services-British Airports Services

I Terminal Building Contractors 1

Figure I. Stansted Airport Development management structure

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Infrastructure Contractors

135

In order to achieve this, specific targets are established for each work package with regard to performance/ quality, cost and programme through the following means.

(a) The basis for performance/quality of components is dictated by BAS Ltd’s engineering guidelines. The method by which these guidelines are achieved is left to the individual designers.

(b) The cost ‘targets’ for the individual packages are detailed in the overall cost plan. These budgets may vary as the design develops but the overall cost plan for the development is sacrosanct. All parties are encouraged to actively seek ‘savings’ at all design stages.

(c) The overall programme completion dates are stipulated by the client. Detail programmes with regard to design, procurement and construction activities reflecting the client’s requirements are initiated by ourselves as consultant contractor for agreement with the client and designers.

3 How do the design team get to know what the client’s objectives are with regard to qualitylperformance, cost and programme? (a) General quality and performance standards for

airport construction are specified within the British Airports Services engineering guidelines which are the basis for design standards. These standards may only be varied in exceptional circumstances or by the specific request of the client. All designers have copies of these guidelines.

The client’s specific requirements for Stansted Airport is developed at client/designer ‘surgery’ meetings where the client’s brief and design con- cept are discussed. A written brief is issued by the client prior to commencement of scheme design.

Prior to commencement of detail design for any work package, a presentation is made to the client by the lead designer to ensure the client’s brief has been correctly interpreted.

(b) Objectives with regard to cost are detailed in the cost plan that is copied to all designers.

This cost plan and the subsequent cost reports for all packages are then monitored at monthly meetings between client/lead designers and Laing. The client’s objectives are very clearly spelled out at these meetings.

(c) As described under question 2, detail programmes are drawn up by Laing following advice on comple- tion dates and third-party interfaces from the client. After agreement by all interested parties the programmes are distributed and monitored at the regular packages meetings with the designers.

4 Give one or two examples of design decisions which were strongly influenced by the knowledge of the client’s objectives The Terminal Building design has responded to the client’s fundamental requirement for a concept that permits flexibility and change once the building is completed. This has been accomplished by:

(a) The generous 36 m grid between the structural steelwork tree structures.

(b) A single-level concourse area that by its very nature allows more flexibility than a multi-levelled design.

(c) The design treatment of the cabin accommodation on the concourse for concessionaires, security, immigration etc. allows for cabin flexibility together with services flexibility by penetrations through the concourse waffle slab to connect with the services distribution in the undercroft below.

5 What arrangements are in place on your project for ensuring that the designers work to the design pro- gramme? Are they effective? Design key dates are agreed between Laing and the designers/client to enable the detail design programmes to be compiled by the designers.

Progress with regard to issue of client’s briefs and subsequent design in relation to these key dates is then reviewed for each ongoing package at each of the three weekly packages meetings held with each of the three lead designers in turn. It is important that all of the relevant disciplines involved including the client, attend these meetings to highlight problem areas both real and potential.

It is recognized (hopefully!) by the designers that honesty at these meetings with regard to their design progress is the best policy. If problems are known about at an early date, they can normally be resolved considerably quicker than if they are pushed ‘under the carpet’.

In addition to the verbal reporting procedure there is a formal design progress report and schedule included by each of the lead designers in the monthly project report that is reviewed by the client at his monthly progress review meetings. Any critical or unresolved problems are brought to the client’s notice.

As to effectiveness of these arrangements - generally once a problem has been identified and brought to the surface the designers are responsive in addressing and correcting the problem. This has, to date, resulted in construction commencement dates at Stansted, being achieved even if slight delays to design/procurement activities have occurred on some work packages.

6 Has one planned ahead in order to rule out the unexpected or has one got some time, money or sacrificable qualitylperformance kept back? One of the objects of planning is to mitigate as many future potential problems as possible. It is not, however, practical or desirable to plan for all conceivable eventualities. It is therefore sensible to hold back contingencies in relation to cost, programme and quality/performance to cater for the problems that escape the planner’s net. Therefore the strategy of both planning ahead and the use of contingencies is used at Stansted.

7 What arrangements are in place for ensuring that designers know the cost implications of their decisions and take them into account? During the design stage, the designers have free and ready access to the cost planners and quantity surveyors to advise on cost of the design and potential changes. LMC are also readily available to advise on cost aspects of design and material options if required.

136 Project Management

In addition to the informal dialogue between the above parties there are also three formal design cost checks during the design stage for each work package at preliminary, intermediate and final stages.

Recognition of these checks is taken by the designers as they are well aware that if the intermediate cost check shows the package to be over cost plan, tenders will not be issued until corresponding savings are made.

The same discipline is involved when tenders are returned. If, despite the above controls, tenders are over budget, savings are required before an order is placed.

8 Contingency allowance in budgets and float in pro- grammes have to be set rationally and their release controlled carefully if budget and completion dates are to be met. Who carries responsibility for these functions

(b)

your project and how are they implemented?

The budget contingency is administered only by the client’s director of the Stansted Development Team.

The overall cost plan includes a director’s contingency allowance. This contingency is pro- gressively supplemented by any savings accrued on tenders returned within cost plan after due allow- ance is taken for future known extras.

Transfer of the director’s contingency in the other direction is a more difficult process, actioned either by a direct client extra or by reasoned argument by the designer to the client that it would be in the client’s best interests for the budget to be enhanced.

The object of this policy being to ensure that the director’s contingency is increased early in the contract period thus ensuring future protection against the latter stages in the job when historically budget contingencies are required. The programme contingency is essentially adminis- tered by Laing in our role as consultant contractor.

The progress of all activities are reviewed at the construction meetings and the pre-construction packages meetings to establish if minor changes in the programme need to be accommodated. Any programme revisions considered necessary for non- critical activities are then ratified by updating the relevant schedules. Critical items are reviewed by Laing with the client to agree the appropriate action.

Since the client is resident on the site and continuous dialogue exists between all parties, early identification of programme problems does occur and the necessary remedial action is quickly agreed. Effective communication is all important.

9 Can you give some information about quality1 performance control methods and how effective they are?

(a) The important point to be emphasized is that the contractor is solely responsible for the supervision and control of his works. If quality standards are not being achieved it is the contractor’s responsi- bility to put things right.

(b) On the Stansted Airport Development, Laing’s team in the role of Construction Superintendent is responsible for ensuring that the Terminal Building

cc>

10

contractors fulfil their obligation with regard to quality of the works. To this end we currently have a staff of eight field managers and engineers undertaking this role of regular and random inspec- tions as the situation requires.

It should be noted that for the Terminal Building work, the designers have no responsibility for any supervisory role apart from currently geotechnical inspection of the bored piling on the forecourt retaining wall. However, designers’ representatives are resident on site to attend to design queries and to ensure that all parties on site understand the design intent.

QAQC procedures pertaining to BS5750 are required on the principal work packages. It is not considered appropriate for smaller trade packages where the normal control procedures are con- sidered perfectly adequate.

When QAQC procedures are applicable, our own specialists audit the records being kept by the contractors.

For the Terminal Building structural steelwork, an external quality monitoring authority was ap- pointed by British Airports Services Ltd to check compliance of the off-site fabrication in accordance with the agreed quality plan.

The infrastructure works are supervised by BAS Ltd’s resident engineers who ensure that quality standards are being met by the usual quality control checks and testing. As to the effectiveness of the control procedures on site - they are working. However, it is evident that continued pressure is required to ensure that an acceptable standard is maintained by the con- tractors.

Different forms of contract motivate people differ- ently to achieve their part of the total project. Please explain why the form of contract for your contractors1 subcontractors was chosen and how it is actually working in motivating people to pursue the client’s objectives.

Careful consideration has been given to the forms of contract on Stansted to ensure that unqualified tenders are received and that the contractors subsequently direct their energies in pursuing their construction works - not in pursuing claims.

To this end British Airports Services Ltd are basing the contracts on the usual standard forms well known to the Construction Industry.

For the major Civil Works the 1973 (5th Edition) ICE Conditions of Contract is used with any changes from the usual form being clearly identified in the Contract Documents.

The various revisions to the JCT Contract for the building works has led to BAS Ltd generally staying with JCT ‘63 as being the latest proven contract, the only diversion to this policy being previously detailed.

‘Special’ forms of contract are not used. The only exception is BAS Ltd’s own form of Contract - 516B - a contract used for low-value building and civil packages on a lump sum basis.

To date the use of these forms of contract have generally resulted in competitive tenders being received with only minor qualifications. They have not, how-

Vol 6 No 3 August 1988 137

ever, persuaded some contractors from pursuing the almost inevitable fictitious claims.

I1 Keeping contractors working to the overall pro- gramme when one or more has missed dates causing problems for the others, is often difficult. Are you able to do it? If so, what is the method? The easier question to answer is how do you keep contractors on programme to ensure there is no problem with following contractors. If, however, con- tractors are late and appropriate action is being implemented to mitigate this delay - what to do with following contractors needs to be addressed. The answer depends on the particular circumstances and can encompass any of the following actions:

(a)

(b)

(c)

(4

Directing the resources of the initial, delayed contractor to the areas most critical to the follow- ing contractors. Delaying the start of the second contractor until such time as practical access is available. Allow a limited start on site by the following contractor to reduce the initial learning curve. Resequence/accelerate the following contractors’ works to offset the late start by a reduced period on site.

The conclusion must be that it is always more beneficial from a practical and financial aspect to ensure that the appropriate steps are taken at an early date with the initial contractor to ensure that subsequent delays to other following contractors do not occur or are at least minimized.

12 The rate of spending on projects during construction is now much greater than would have been thought possible a few years ago. What are the practical measures you take to achieve this? The rate of spending is dependent on the availability of design, resources, sufficient areas to sustain the re- sources and the financial requirements of the client’s pocket.

At Stansted the areas are readily available (ap- proximately 2 350 acres) and the resources are also currently available despite a considerable upsurge of construction activities in the South East. Our rate of spending, although considerable, is dictated, naturally enough, by the availability of design and the client’s annual spend provision for the development.

What is more important to our client is not maximiz- ation of rate of spending but controlled spending to ensure his budgets are matched each financial year. Therefore, our joint responsibility with the client’s cost planner is to monitor and manipulate the construction programme and cost liability forecast to match the client’s annual budget.

13 Some contractors have been offering a contribution to the design process called ‘buildability' for some time. How real is it for you? How and when do you bring in the contributions? Laing’s agreement with Stansted Airport Limited calls for a positive input with regard to advice on ‘build- ability’. The client therefore requests that to ensure a

practical and economical design solution is achieved we advise and comment on the following:

(a) alternative design solutions, (b) alternative material options, (c) construction feasibility, (d) construction options -with regard to time and cost, (e) cost savings.

A few examples of our input to date includes:

(a)

(b)

cc>

(4

(4

(0

An erection feasibility report for the Terminal structural steelwork. Advice on practical construction methods for con- crete works to assist finalization of details. Technical report on alternative single-membrane roofing materials together with construction experience. Advice during the external cladding design development with regard to weathering details and material options. Hydraulic checks on the innovative UV rainwater system for the Terminal Building. Programme and cost options regarding many aspects of the infrastructure works etc.

It is important that the ‘buildability’ contribution is made at a sufficiently early stage to allow the design to be influenced. The requirement for input usually is diagnosed either by the client, designers or ourselves at the pre-construction packages meetings when the design development is discussed.

It is noted that we are fortunate on this development that the designers and client welcome a constructive positive input into the design process.

14 The days when a project was thought complete when the contractor handed over a complete but empty and inactive building are over. Nowadays, client’s commis- sioning can be a significant project in its own right. Have you got it right? Does it meet costltimelqualityl performance targets? Is there a special way of managing the commissioning project? It is assumed for this particular contract that the definition of commissioning encompasses all aspects of the Client’s activities to complete the building/ development ready for use.

The commissioning of Stansted is still very much in the future; however certain aspects are being considered now, n8mely:

l Progressive handover of the completed infrastructure works from the development team to the client for subsequent running and maintaining for use prior to and at opening day of the development.

l Programming the fitting out works of the tenants for such areas as retail outlets, restaurants etc. to ensure that negotiations are left as late as possible. Pro- gramming and packaging of the services works to the ‘cabin’ areas is underway to ensure they do not affect the warranties and maintenance agreements on the main service systems.

Since the client has considerable experience in com- missioning other airport developments, one cannot

138 Project Management

foresee any particular problems. Whether one gets it right remains to be seen.

15 Teamwork is said to make projects go well, anta- gonism to be a cause of certain failure. What positive steps do you take to minimize the risk of cooperation falling apart and being replaced by disputes? I have addressed the question of maintaining teamwork under two separate categories - however, both are not dissimilar.

The following actions have been implemented at Stansted to maintain a reasonable ‘team spirit’ with contractors.

(a)

(b)

Cc)

(4

The client arranges informal lunches on a regular basis with all contractors involved on the develop- ment including ourselves to chat about progress, problem areas and general items of interest. Maintenance of a regular dialogue with the con- tractors’ directors to ensure their continued involvement and both parties keep their fingers on the pulse. Social activities are encouraged and convened with client/contractor/Laing on a fairly regular basis. Antagonistic correspondence is discouraged and vetted. Telephone calls are encouraged to air grievances.

The items concerning social activities and vetting of correspondence also apply to steps taken with the designers to encourage teamwork. In addition:

(a) Laing chair all pre-construction and construction meetings with the designers, therefore gauging the depth of teamwork prevailing.

(b) Maintenance of a regular dialogue with the design team’s directors to highlight problem areas before letters start to be typed.

As a concluding comment on the subject of teamwork, it should be pointed out that successful projects depend

on the project team having a strong leader. That leader is usually, but not always, the client.

16 Finally, all good managers think ahead. Give us two things which you want to do differently or to be different on your next project. Since the client is progressive and welcomes constructive suggestions any items thought worthy of implementa- tion are actioned. There is therefore to date nothing that one would wish to do differently on the next project.

However, Stansted Airport is a fairly long project, currently in its relatively initial stages, with some three years yet to go to completion. There is little doubt that a few items will be identified by the end of the develop- ment.

APPENDIX: BASIC DATA Name of project: Stansted Airport Development Location: Stansted, Essex Client: Stansted Airport Limited Use of development: London’s third airport Construction cost at current prices approximately f3OOM (including fees) Date detail design started: Terminal Building (November 1985), Infrastructure (June 1985) Date construction started: April 1986 Date construction will finish: Autumn 1990 Average spent per month during construction: f5.2M Peak spent per month during construction: &12.4M

Paul Weller is currently Associate Director of Laing Management Contracting and is responsible for Laing’s involvemeni on the Stansted Airport Development. His last two projects have been No I Finshury Avenue - the first building in the Aroadgate area development in London. Prior to this, Mr Weller was involved in a development at the lnmos Factory in Newport South Wales where the architect wsas Richard Rogers. He has been involved in managing contracting for the last IS years.

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