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Next week the construction industry meets to debate the ideals set out in the Government's Rethinking Construction report produced by the Construction Task Force. Underlying them is a commitment to partnering - but is this the answer to construction's ills? Antony Oliver analyses the views of the industry.

NCE's Truth about Partnering survey shows that the majority of the construction industry is behind the concept of partnership arrangements. But there is widespread suspicion, mistrust and even ignorance about how partnering works.

The fact that 95% of respondents feel there will always be a place for traditional contracting indicates that partnering is un- likely to take over. It will remain one of many ways for the industry and its clients to do business.

Certainly there is strong evidence of the advantages of working in partnership. Of the 84% who said they had tried it, 82% reported cost savings for the client and 74% said there were financial benefits for the supplier.

However, these savings were relatively small. Only a third of respondents reported client savings of more than 10% on partnering projects, while a tenth had seen suppliers' margins improve by more than 10%.

For an industry looking to partnering to meet Sir John Egan's task force target of reducing the cost of construction year on year by a minimum of 10%, this is fairly timid progress.

A paper by David Brown and Mike Riley of Southampton University's business engineering group, published in this month's ICE Proceedings, highlights the problem.

'Although long term partnering is likely to produce the largest benefits, there are a considerable number of projects where this approach is not possible. This is particularly true of either one-off civil engineering contracts or where the client is a public body.'

NCE's survey echoes this sentiment. A quarter of engineers responding believe partnering is only open to large companies. The feeling is that one-off projects - which make up most the industry's civils workload - will still be won on a traditional competitively tendered basis.

One consultant makes this point on his questionnaire: 'Partnering appears to be a convenient title used by a client who intends to squeeze the other 'partners' as normal.' Another says: 'There is still a good degree of cynicism to overcome. Smaller jobs are unlikely to ever warrant partnering.'

To a degree Egan's task force report suggests that it will only be the largest operators that will be the winners in the strive towards greater efficiency.

It seems obvious that clients with huge construction programmes, such as BAA, Railtrack, Tesco or Slough Estates, should reap the benefits of partnering because they can sustain long term partnerships with their construction services suppliers.

But Brown and Riley estimate that these clients account for only 15% of the industry's workload. It is the 85% of industry working on one-off projects that need to be targeted if the Egan savings are to be achieved.

Dr Stuart Green of Reading University's construction management and engineering department goes a step further. In his paper 'Partnering: The propaganda of corporatism?' he suggests that partnering is quite often a 'crude exercise in buying power'.

He adds: 'The buying power of the industry's major clients continually discourages dissent to the partnering ideal. Construction companies which are not similarly committed risk being denied access to a substantial proportion of the UK market.'

At the moment it looks as though partnering arrangements offer better benefits to the clients than to contractors and consultants who share a relatively small proportion of the savings.

NCE's survey shows that 43% of respondents feel that clients hang on to too much of the savings made from partnering and the impression is that the industry's savings are meagre scraps in comparison.

Comments in NCE's poll include: 'Partnering is a huge propaganda exercise on behalf of commercial vested interests.' Another respondent says: 'Partnering is restrictive in that it artificially constrains what should be an 'open' marketplace.'

Green agrees: 'The achievement of the appropriate culture is almost universally held to be of vital importance to the success of partnering. Despite the seductive discourse on 'empowerment', 'working together' and 'relationships', the ultimate measure of success seems to hinge on cost improvement.'

Supporters of partnering would put this down to continued cultural problems in the industry with suppliers and clients paying lip-service to partnering arrangements while retaining their old win at all costs mentalities.

British Steel market and product development director Geoff Hooker, who was a key adviser to the Egan task force, acknowledges that smaller firms will be suspicious of radical change.

'Construction is at this early stage,' he says. 'But any new process will not have a 100% hit rate. We need to use the experience of the large companies who say it works. Trying and failing is better than not trying at all.'

Hooker says the large clients will clearly have to work with fewer firms. He likens the process to that which the manufacturing and retail industries have already gone through.

'As a client no-one can manage 40,000 suppliers, but at British Steel we used to and we had to change. The same happened with other big retail firms. The difference in construction is that even the major clients like BAA have a relatively small market share.'

While he insists that partnering is not about the 'big guys getting further ahead at the expense of the smaller', he adds: 'Life can not always move at the pace of the slowest.'

But it is also true that even some of the largest contractors are concerned about how much of the benefits achieved through partnership arrangements are being passed down the supply chain.

Contractors like Balfour Beatty and Tarmac are not getting involved in partnering arrangements out of the goodness of their hearts. They need to maintain their share of the pounds 40bn of work promised - largely under partnering arrangements - by the industry's leading clients each year.

The point is that if they are going to save clients 30% of their construction costs they expect to raise their margins above 2% - and they are not expecting that simply working under partnering arrangements alone will help boost their margins. This is why they are also looking to introduce other cost saving measures through improvements like benchmarking.

So for partnering to really be effective we must look again for the culture change first advocated by Sir Michael Latham in his 1994 review of construction. So often it is making this culture change which is the problem - even when working under so-called partnered arrangements.

As one consultant in NCE's survey says: 'Partnering is a public relations exercise. The contractor and consultant are still at one another's throats.'

Malcolm Trigg, managing director of project management consultant Vector, is convinced that partnering on its own is not the answer to the industry's ills. Until contractors and consultants make a bigger effort to focus on the needs of the client rather than their own interests and profits, they will be unable successfully to embrace partnering.

'Partnering has very often become a dirty word,' says Trigg. 'The principles can be in place but can easily be abused. When we get into partnerships we bare our souls. If you don't the arrangement just will not work.'

He says it is inevitable that most clients want to work under long term relationships with just two or three suppliers but admits that within civil engineering the concept is still 'a bit confused'.

One contractor graphically makes this point in NCE's survey: 'Partnering is in danger of becoming all things to all men. Our client talks about it but has no idea how to deliver it.'

This is hardly surprising given the industry environment of competitive tendering. Research published this week by KPMG reinforces the view. It shows that two thirds of firms still win more than 60% of their work through competitive tendering.

To suddenly abandon such traditional practices will be hard for clients andthe industry alike, and may not always be appropriate.

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