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Carved out of chaos How are those companies which bought British Rail design units faring? We start with a look at CEDG - the only team not snapped up by a consultancy.

When privatisation finally came to the railway industry in 1994, observers predicted that the many parts of huge, unwieldy British Rail would dissolve in chaos, being unable to price work competitively and ignorant of the first principles of marketing.

But according to Hugh Fenwick, managing director of CEDG, the truth could not have been more different. He is enormously proud that the consultancy has met all the major targets it set itself in its 1995 business plan, including growing the business by more than the 5% it was aiming at.

CEDG was previously the York-based arm of British Rail's in-house consultancy working within the Intercity organisation. And of the five offices which were put up for sale, it was the only one not bought by a civil engineering consultancy. It was snapped up by British Steel.

'They wanted the capability to serve the railway industry,' Fenwick says, 'all the way from feasibility through to construction.' And he points to the fact that the management team in place at the sell-off is still intact - a sign of the confidence which the new parent company has in CEDG.

But, as Fenwick explains, a lot of work went into reaching this stage, and it began as far back as 1993.

Some 25 senior managers went off on a management course to discuss the possibilities of privatisation and see how they could take the company forward. 'We gave the staff a choice,' Fenwick says. 'Either we could start to run the business down and get the best deal possible for our employees, or we could take it forward as a going concern.'

A ballot showed that staff were 'almost unanimously' behind the latter option, so the company began working towards privatisation. 'We had to gear ourselves up to becoming commercially successful,' says Fenwick. 'We felt very vulnerable because we had been cocooned within BR and had not had to fight for work in the past.'

They started setting themselves up as a separate company, even to the extent of invoicing their 'customers' within BR for work they had done. 'We just wanted them to be aware of how much it was costing them and how much it cost when they changed their minds,' Fenwick says. It was good practice for pricing work, too.

CEDG is now a part of British Steel's railways division, along with rail manufacturer British Steel Track Products, switch and crossing manufacturer Grant Lyon Eagre, and track relaying and maintenance contractor GrantRail. This set-up is central to British Steel's plan to provide a one-stop shop railway capability.

Some 200 people are employed within CEDG: 80 of these are in the civil engineering division which designs bridges, stations and depots, as well as providing construction supervision and safety training. A permanent way division of 40, along with 35 electrical and mechanical engineers and 15 quantity surveyors, make up most of the remainder. Six signalling engineers have been recruited since privatisation so that CEDG can offer a full design service on track alterations, although it does not yet have the capability for major signalling project redesigns. There is also a full-time architect on the staff.

Since the sale, CEDG has taken up the challenge of expanding into new geographical regions, opening offices in London, Birmingham and Manchester and even taking on some overseas work. Until 1 April, it had been known as CEDG York, but 'York' has now been dropped.

'We have done a little overseas work,' Fenwick admits, 'but the UK market is buoyant at the moment and will be for the next three or four years.' The challenge for CEDG over this period will be to decide where and how it wants to grow.

'Obviously our strength is in railways, where we have a lot of experience,' says Fenwick, 'but relying on that is putting all our eggs in one basket, and now we need to address what we are going to do to cover that risk.'

The company has not yet decided whether it wants to expand organically or by acquisition, but accepts that it must grow one way or another. Project management and facilities management are two areas which CEDG feels it could move into.

Work at the moment includes feasibility studies for passenger and freight upgrades on the West Coast Main Line, and rationalisation of layout and signalling in Leeds city centre. The company is also consultant to Laing for station regeneration work in the North West zone.

Helena Russell

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