Strengthening the supply chain - collaborating to drive better value outcomes in infrastructure

Effective supply chain engagement, progressive procurement and collaborative forms of contract can bring added value in the delivery of an infrastructure project.

Stephen Blake FRICS

The Commercial Manager in infrastructure is perfectly placed to make it happen, says Stephen Blakey FRICS, Commercial Projects Director, Network Rail.

What attributes do clients look for in an infrastructure Commercial Manager?

There are two aspects which I think are particularly significant. Firstly, the capability to address four key questions; what should it cost, what will it cost, what did it cost and why. Being able to answer these questions is a key aspect of commercial stewardship in infrastructure.

Secondly I believe that in addition to meeting ethical and professional expectations, todays infrastructure commercial manager has to role model collaborative behaviours, which are increasingly relevant in our pursuit of value for money.

How important is collaboration in ensuring value for money?

In 2011 Network Rail committed to making collaboration the platform from which we would deliver our multi-billion investment programme and to lead the rail sector’s supply chain in developing its collaborative capability. We secured BS11000 accreditation in 2012 and in March 2017 became the first UK client to achieve ISO44001, the international standard for collaborative working.

In addition, we created the role of Head of Collaboration and developed effective process and systems to support the cultural change needed to establish collaboration as the norm. We also employed progressive contract forms and established alliances to deliver our major projects and national programmes, all of which are designed to create an effective collaboration between client and supply chain, bring added value and meet those key challenges.

Can you give examples where collaboration has succeeded?

We have an increasing body of successful collaborations from Reading Station, London Bridge and the Stafford Alliance through to the Wessex Capacity Alliance, our two Switches & Crossing Alliances and more recent programmes such as East West Rail.

The Stafford Alliance was interesting and when created, was seen as our first ‘pure alliance’ due to the progressive terms and conditions, where the Alliance members shared the risks and benefits and worked as a single integrated team to a principles based contract. The procurement was also progressive, placing significant emphasis on peoples’ behaviours as well as their competencies. It successfully delivered £250m of upgrades to the West Coast Main Line more quickly and sustainably that originally considered possible.

How has Network Rail’s Commercial Directors’ Forum helped to drive industry change in terms of collaborative working throughout the supply chain?

We have actively engaged across industry via a number of forums including the award winning Commercial Directors’ Forum. Comprising key supply chain and industry stakeholders, we have driven improvements in liquidity and fair payment, jointly developed and published commercial guidance and ensured aspects of best practice have been incorporated into our terms, conditions and commercial competencies. Most importantly, we have retained the advocacy of our supply chain for a forum that brings real changes to the way we do business.

Where is Network Rail’s focus for the next control period and how will collaboration feature?

In the first instance it’s meeting those key challenges, with a renewed focus on strengthening our commercial and performance culture to drive better value for money and show tangible efficiencies. In addition we will build on our experience of collaborative forms of delivery through further use of integrated frameworks and alliances.

For the rail sector and broader infrastructure industry, collaboration is now a recognised and credible approach that when properly employed can deliver real added value. For the infrastructure commercial manager, I see it as an increasingly important dimension of their professional capability and in turn, the capability of our profession.

Stephen Blakey FRICS will be speaking at the RICS Commercial Management in Infrastructure Conference on 8 March 2018 in London. Places are still available.

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RICS Commercial Management in Infrastructure Conference

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