Partnering for ICT Installation: National Grid for Learning, Dundee

What Was the Stimulus?

Networking schools as part of the National Grid for Learning is a major challenge, involving substantial investment in ICT and requiring high standards of project management to ensure effective installation and minimum disruption to the schools affected.

The Architectural Services Division of Dundee City Council saw an opportunity to apply "Egan thinking": an approach to modernising construction procurement which focuses on working practices and structures which deliver value to the customer by cutting out waste and improving the quality of products and services (see the Government's Rethinking Construction report). They considered using a traditional approach to competitive tender, but felt that partnering would offer a more attractive alternative - less adversarial and more attuned to quality results.

This National Grid for Learning (NGFL) project was the first partnering project undertaken by the City Council, and its success has led to the approach being applied in other areas of Council construction activity.

How Was The Need Tackled?

Introducing partnering
Architectural Services first had to succeed in convincing sceptical colleagues in the Education Department of the potential value of a partnering approach, stressing the scope for improving the end product and customer/ user satisfaction.

To identify contractors who could offer the best fit as partners, Architectural Services devised a two-stage procurement process using questionnaires, presentations and interviews. The questionnaires include weighted questions which are marked by representatives of the client department and Architectural Services consultants. The selection of contractors is based on a percentage score for cost and one for quality. (The council's long-term ambition has been to partner with a small number of contractors and suppliers, with the pilot being used to select the best potential partners.)

Four contractors were selected to take part in the pilot, three to undertake two projects each and the best performer, three. They become involved on an 'at risk' basis, committing their own resources at a very early stage in order that they can participate and contribute early to the design process. Once design was sufficiently advanced, a Guaranteed Maximum Price (GMP) was agreed for each school and formal acceptance issued to each contractor. The GMP and accounting system is based on an 'open book' framework whereby net costs are used and an allowance for the contractor's overhead and profit is added.

The Partnering Charter setting out key principles of the partnership, Key Performance Indicators (eg, for client satisfaction, cost, safety and targets for project costs and delivery) and the evaluation process were all agreed by the project team which included representatives from all partners. The Charter also provided for dispute resolution by the project team, with a formal framework for any dispute that they could not settle themselves. At this point, a dispute resolution team would meet, comprising director level nominees from the client, consultant and relevant contractor.

The benefits are measured using the industry standard Key Performance Indicators, which reflect the need for clear, measurable returns to each party. Benefit to the client includes predictability of time and cost and increased satisfaction. Benefit to the contractor includes increased profitability, reduction in tender costs, an input to the design process and continuity of work. Other benefits include reduction in accidents and increased personal satisfaction for team members.

Investment in training
Team building played an important role in the pilot and in subsequent partnering projects, in ensuring commitment and helping those involved adjust to new ways of working. The Council arranges in-house seminars (facilitated by senior managers) for all staff to raise awareness of partnering, and initially used external consultants to train staff in the basic principles of partnering. A half-day workshop is now held for all partners on any new project, to include contractors, main sub-contractors, clients, utilities and consultants (in-house and external). These give all team members team the opportunity to discuss the partnering arrangements and ask questions about procedures. Participants are developing new skills in team working, communication, risk assessment and problem solving. The Council has sometimes found a limit to what the training can provide, where individual members of staff have found it difficult to adapt. In these cases they have been replaced on project teams by others more attuned to developing partnership skills.

A few members of Council staff, with previous training and experience as project managers have been trained to act as facilitators on large projects. Their role is to ensure that partnering procedures are carried out effectively by all team members.

Electronic exchange of information
On all partnering projects the Council aims to exchange information electronically with a network between the site, contractor's head office, consultant's office and client's location. In order to protect the confidentiality of the council's main electronic information system, it was necessary to install a dedicated server through which all partnering project information is accessed. The cost of laptops purchased for use on site is allocated to the project.

What Were the Outcomes?

Implementation of the pilot was successful on a number of counts including:

• the costs for the first phase schools was 8% under budget (compared with a norm of annual increases of 10%)
• disruption to school routines was minimised, with all installations completed at least 10 days (25%) ahead of schedule

The project won the Best Team Award at the Convention of Scottish Local Authorities Excellence Awards in 2000 and the Quality in Construction Award 2001 for Best Small Project (joint winner).

Dundee City Council has extended partnering to the procurement of a wider range of projects - by March 2002, involving expenditure of over £50m across more than 20 projects (including the reinstatement of a listed school building and planned maintenance programmes).

Results and benefits include:

• monitoring of Key Performance Indicators shows that in four out of five projects there has been increased client satisfaction and overall improvement in performance
• the Council has staff equipped with new skills and has successfully adopted new working practices
• there is a pattern of increased trust, communication, teamwork and continuous improvement
  
• the dispute resolution team has never been needed

What Was Learnt?

Lessons include:

• the value of partnering as a better form of procurement than traditional competitive tendering, resulting in costs savings and better quality outcomes. Most clients, and all contractors, have been keen to participate and have expressed their satisfaction at the outcome of these projects
• the need to invest time in convincing elected members and chief officers, explaining the benefits of Egan principles and using examples of successful partnering
• the benefits of agreeing a Project Charter at the outset, including the intended benefits for each party, procedures for resolving disputes and principles (such as transparency in financial dealings)
• the value of investing in joint staff development to manage the partnering relationship, and in developing staff to act as facilitators

Contact

John Porter
City Architectural Services Officer
Dundee City Council
21 City Square
Dundee DD1 3BY

Tel: 01382 433640
john.porter@dundeecity.gov.uk

www.dundeecity.gov.uk

For more case studies of partnering projects in the construction sector, see the Movement for Innovation website: www.m4i.org.uk.

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