2. Michael Thompson PUTTING PARTNERING INTO PRACTICE T E A M F O C U S Establishing the Team. - Is It Ever Too Early or Ever Too Late? Establishing the Team. - Is It Ever Too Early or Ever Too Late? Construction Productivity Network Granada Studios Manchester 16 September 1999 Construction Productivity Network Granada Studios Manchester 16 September 1999 www.teamfocus.org

3. CONTENTS Value Management Setting up for Disaster! “Constructing the Team” and “Rethinking Construction” Best Practice Partnering Culture Case Histories Lessons Learned The Future? Establishing the Team - Is it Ever Too Early or Ever Too Late?

4. www.teamfocus.org DESIGNMANAGEMENT CONCEPT MANAGEMENT CONSTRUCTIONMANAGEMENT OPERATIONMANAGEMENT QualityManagement ValueEngineering RiskManagement MoneyManagement TimeManagement EnvironmentManagement SafetyManagement Team Culture VALUE MANAGEMENT Project Management

5. www.teamfocus.org 2 + 2 = 3! SETTING UP FOR DISASTER! The Client sets the bidding rules He may be bound to use competitive bidding processes (public sector) Invariably he chooses the lowest bid when he should try to determine the likely lowest out-turn cost With intense competition, the lowest bid is probably under-priced DISASTER! 2 + 2 = 3!

6. www.teamfocus.org “CONSTRUCTING THE TEAM” Sir Michael Latham, at the request of the Government, reviewed the UK Construction Industry in 1994 Amongst other things, he recommended a different way of working which would be less confrontational - such as Partnering

7. www.teamfocus.org “RETHINKING CONSTRUCTION” Sir John Egan published his report in July 1998 as a sequel to Sir Michael Latham’s report Most significant to Partnering were the annual performance targets he suggested………

8. www.teamfocus.org “RETHINKING CONSTRUCTION” ANNUAL PERFORMANCE TARGETS ANNUAL PERFORMANCE TARGETS

9. www.teamfocus.org EFFECTIVE PARTNERSHIPS Set up multi-organisational project teams as a “single organisation” Make them lean and efficient! Avoid duplication of roles, and gaps between roles Introduce the Partnering culture, including effective communication, trust and common objectives

10. www.teamfocus.org BEST PRACTICE There is no single definition for Best Practice. One definition: –It is the achievement of all the goals laid down by a Project Team (including the Client) for the final product, by consideration of the best techniques of procurement, contract strategy, quality assurance and good supply management

11. www.teamfocus.org BEST PRACTICE Pre-partnering, could we have done better? Even with the Partnering culture can we do better? Should we not strive for 100% in “Excellent”? Would not then Best Practice be achieved?

12. www.teamfocus.org PARTNERING CULTURE Probably less than 10% of all projects in the UK adopting the Partnering culture in the last two or three years have had true Partnering contracts in place For many, the culture has been adopted after contract award However, to obtain maximum benefit, a Partnering “cost plus” contract is preferable.

13. www.teamfocus.org PARTNERING CULTURE Of over 120 projects that the Presenter has been involved in, all had clear objectives and the majority were successful to a degree in achieving them Less than 5% did not succeed One that did not succeed required a court judgement.

14. www.teamfocus.org PARTNERING CULTURE But when should the culture be introduced ?

15. www.teamfocus.org CASE HISTORIES Three case histories: –Sewage Treatment Works in Southern England Project Partnering from Outline Design Stage –Motorway Bridges Refurbishment Partnering culture from Bidding Stage –High School in Southern Scotland Partnering culture for last 20% of Construction Stage

16. www.teamfocus.org SEWAGE TREATMENT WORKS Four organisations, working together without walls between themFour organisations, working together without walls between them Partnering compatible contract in placePartnering compatible contract in place £12 million contract£12 million contract

17. www.teamfocus.org THE CHALLENGE Build a brand new sewage treatment works from outline design on a “green field” site within 21 months and within budgetBuild a brand new sewage treatment works from outline design on a “green field” site within 21 months and within budget Undertake the earthworks during the worst period of the year!Undertake the earthworks during the worst period of the year!

18. www.teamfocus.org A QUICK START The Project Team started work on 24 July 1995The Project Team started work on 24 July 1995 The Team Building Workshop took place on 31 July 1995 and a Charter agreed and signedThe Team Building Workshop took place on 31 July 1995 and a Charter agreed and signed The Value Management Workshop commenced on 2 August 1995The Value Management Workshop commenced on 2 August 1995 A firm, agreed, outline design was in place within 10 - 14 days.A firm, agreed, outline design was in place within 10 - 14 days.

19. www.teamfocus.org SOME SUCCESSES Rapid establishment of the design with confidence through Value Management processesRapid establishment of the design with confidence through Value Management processes Effective Risk Management relating to Planning Permission and Discharge ConsentEffective Risk Management relating to Planning Permission and Discharge Consent Design and construction taking place concurrentlyDesign and construction taking place concurrently Rapid appointment of sub- contractorsRapid appointment of sub- contractors Self supervision of construction works (TQM approach)Self supervision of construction works (TQM approach) Joint planning with Operations the testing and commissioning of the PlantJoint planning with Operations the testing and commissioning of the Plant Fast resolution of earthworks problemsFast resolution of earthworks problems

20. www.teamfocus.org CONCLUSION Completed and commissioned 2 weeks earlyCompleted and commissioned 2 weeks early Handed over the plant £700,000 within budgetHanded over the plant £700,000 within budget Self-supervised - quality excellent!Self-supervised - quality excellent! Good Health & Safety recordGood Health & Safety record Environmental constraints observedEnvironmental constraints observed

21. www.teamfocus.org MOTORWAY BRIDGES REFURBISHMENT Team approach introduced after contractor appointedTeam approach introduced after contractor appointed In their Charter, the Team undertook to promote excellent working relationship in an environment of total trust, openness, honesty and good humour.In their Charter, the Team undertook to promote excellent working relationship in an environment of total trust, openness, honesty and good humour.

22. www.teamfocus.org THE PROBLEM Relationships deteriorated on site between the Contractor and Resident Engineer staffRelationships deteriorated on site between the Contractor and Resident Engineer staff They were working in separate buildings on the same site and had set up “opposing camps”They were working in separate buildings on the same site and had set up “opposing camps” Team performance was declining rapidlyTeam performance was declining rapidly

23. www.teamfocus.org ACTION TAKEN Senior Management decided the team would not failSenior Management decided the team would not fail They insisted on a single office on site, and changed some staffThey insisted on a single office on site, and changed some staff There were significant improvements in relationships and the Project was a success!There were significant improvements in relationships and the Project was a success!

24. www.teamfocus.org HIGH SCHOOL, SCOTLAND £4 million contract£4 million contract 30 month construction schedule30 month construction schedule Due to finish August 1998Due to finish August 1998 Only 50% spent by month 24 (80% through schedule)Only 50% spent by month 24 (80% through schedule) Main problemsMain problems –inadequate information flow –quality problems

25. www.teamfocus.org ACTION TAKEN Partnering culture introduced during a Team and Management Workshop with only 5 months to goPartnering culture introduced during a Team and Management Workshop with only 5 months to go Major issues identified and actions agreedMajor issues identified and actions agreed Contractor provided the Client with assistance to progressContractor provided the Client with assistance to progress

26. www.teamfocus.org OUTCOME The School was completed on time, but with some additional costThe School was completed on time, but with some additional cost Additional cost more than compensated for cost of housing children temporarilyAdditional cost more than compensated for cost of housing children temporarily Satisfied ClientSatisfied Client Reasonable return for ContractorReasonable return for Contractor

27. www.teamfocus.org LESSONS LEARNED It is never too late…... But introduce the Partnering culture as early as possible, ideally as early as Outline Design Stage And introduce an appropriate form of contract if you can for maximum benefit, including the sharing of gain

28. www.teamfocus.org THE FUTURE? Continue the Partnering culture Apply more formal performance monitoring and measurement procedures, such as Key Performance Indicators through such processes as Project Alignment Continue to strive towards Best Practice by aiming for the best finished product every time.