Constructing Excellence in Wales

Size of project: £700m
Type of project: Infrastructure improvement
Demonstration themes: Customer needs, providing the business case for health and safety, integrated teams
Contract: NEC Option C

Team:

• Client: Dwr Cymru Welsh Water (DCWW)
• Main contractor: Alliance members                          

The Demonstration

Since the mid 1990s DCWW has followed a collaborative procurement approach for its investment programme, which arose largely out of European Directives requiring major improvements to clean, waste and bathing water quality. Initially a number of individual projects adopted a partnered approach and their success helped to build a multi-partner alliance in 2000 to deliver a large part of the investment programme. Over five years, this alliance delivered significant cost reductions when compared to the Regulatory Allowance. The ‘alliancing’ approach aligns with the way in which the water industry operates, requiring an integrated response to the customer.

The Delivery

The creation of a multi-partner Alliance provided the opportunity to share common processes and systems and disseminate best practice via a number of working groups. A key element was the development of a close working relationship with the regulator in order to achieve best-value solutions, and with the operators to ensure end-user and customer needs were being fully met. As part of a programme of continuous improvement, the alliance has subsequently implemented further initiatives to strengthen the effectiveness of collaborative working – most notably integrating the supply chain.

The vision is not to deliver fixed objectives but to improve performance year on year in line with DCWW’s vision (‘The Banner’), and so minimise the cost to the customer while at the same time improving the overall quality of the product and the assets to deliver them. This is achieved through an integrated leadership team representing 14 companies, a focus on ‘doing everything from a customer perspective’, and a belief that collaborative working is more effective than traditional procurement.

The benefits of this approach are already bearing fruit. Costs are continuing to fall as integrated team working combined with clear ownership deliver better-value solutions. Minimised bureaucracy and duplication of effort further aid this process, and this in turn leads to a more positive working environment and open sharing of new ideas focused on solutions rather than organisational barriers.

Health and safety is the top priority, with directors taking the lead in the inspection programme. Industry-leading statistics on health and safety are being achieved with year on year improvement targets being met. Joint audits are carried out across the alliance with support given to the whole supply chain where improvement is required. The proactive approach includes investing in training and safety-led improvements in plant and equipment.

Data is carefully analysed to reduce the risk.

Customers are central to everything that is done in the business. A number of barriers to improvement were identified, such as too many different systems for dealing with customers, poor relationships with customers on projects, and no proper means of ‘capturing’ good practice. Several initiatives were taken to tackle these issues. For example, there is now a single complaints procedure applied across all the partners working on construction in the AMA; liaison groups have been set up to deal with the difficult schemes; and a single identity has been developed so that AMA officers always introduce themselves as DCWW.

Guaranteed standards of service have been introduced to compensate  customers if required standards for answering letters, meeting appointments and so on are not met. Customer reps in the teams ensure that the needs of the customer are kept at the centre of the activities of the site teams.

Integrated teams not only provide a more satisfying and inspiring environment to work in, they are more cost effective and efficient than the traditional approach which separated client, designer and constructors. An aligned incentivisation scheme with fixed fees and combined target costs helps by ensuring that if one wins, all win. This also encourages best practice to be shared across the alliance, and that risk is properly apportioned.

Success is recognised and celebrated, whether at the AMA awards nights or on a day to day basis by senior managers taking time to personally thank individuals and teams. This is only possible through the fully integrated approach that this unique form of ‘Alliancing’ creates. Visible evidence of this is seen in, for example, the sharing of offices and shared and visible governance. Most of all though, the results speak for themselves.