First Engineering and Railtrack have embarked on a maintenance contract that could set a benchmark for the rest of Britain's railways. Richard Thompson reports.
Strategic Alliance is a load of balls says First Engineering maintenance director Reg Kirton-Vaughan mischievously.
His seemingly negative attitude sounds surprising. First Engineering is involved in a ground breaking alliance with Railtrack and might be expected to be more upbeat about the deal. But Kirton-Vaughan goes on to explain that the £330M agreement to maintain Scotland's railways for the next five years had originally been presented to the network manager as a series of interlocking balls.
'We first put forward a simple diagram made up of balls to show how the Strategic Alliance might work,' he explains . 'Perhaps circles would be a better word.'
The contract, which began on 1 April, is the first of Railtrack's RT1A infrastructure maintenance contracts to be renewed since privatisation. Its form is significant. It is a quasi-partnering arrangement designed to foster openness and co-operation between client and contractor through the co-location of staff. It could reduce maintenance costs by up to 10%, the team says.
The alliance idea has been developed by First Engineering over the past three years. For the last six months it has been working on the concept with Railtrack in its Scottish zone. Several other Railtrack zones are considering adapting it for their own use.
At the top of the Alliance a Policy Board will set out the objectives. The Policy Board will include Railtrack Scotland director Janette Anderson, First Engineering chief executive Tony Smith and an independent chairman. An Alliance Board responsible for implementing policy, managing contracts issues and spotting opportunities to improve quality and reduce costs will provide direction for the Delivery Units which, on site, will see client and contractor staff sharing the same offices.
An independent facilitator will bridge the gap between the policy and Alliance boards while the key link between the Alliance board and delivery teams will be joint Strategic Alliance manager Steven Bell, who comes from First. Both jobs are co-funded.
'People say it is a soft option,' says First commercial director for rail Ian McKail. 'But it is not, it will be harder. There will be differences in expectation and understanding.'
'The key will be stickability. We can't be diverted. The biggest thing will be to catch issues early and confront them.'
Kirton-Vaughan believes that recent changes at the top of Railtrack have made the network manager more amenable to the alliancing idea.
'Two years ago Railtrack's end game was aimed more towards a facilities management role,' he says. 'But with the change of chief executive they have become more hands-on. That integrates well with our proposals. Eventually we would like to get the train operators involved but we need to get our own act together first.'
Railtrack Scotland's infrastructure contracts manager Hugh Wark agrees that the form of the contract between Railtrack and its contractor is critical.
'It is integral to what we do,' he says. 'Breaking down the barriers through co-location can drive down the costs of maintenance. We've got to get involved in open communication and give advance warning about what we do.
'It is going to require a lot of effort to realign brain cells as to how to co-operate instead of seeing it as them and us.'