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Exclusive | TfL slammed for lack of innovation in supplier report

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Transport for London (TfL) suppliers have slammed their client for failing to implement innovation, in a performance report seen by New Civil Engineer.

The operator has been criticised for having a “lack of risk appetite”, “slow decision making” and a “lack of effective engagement” in the TfL Voice of the Supplier Report 2018, compiled by State of Flux.

While the report highlights good management and contractual practices within TfL, it also highlights “frustration at […] an inconsistent and uncoordinated approach to communication” and a “long and burdensome” tendering process which is too heavily focused on cost.

Among the list of action points spanning four pages, TfL has been urged to:

  • Explore the appetite it has for change and innovation
  • Review and streamline decision making processes
  • Be more open to proposals on risk and reward sharing and joint projects
  • Rather than focusing solely on price, consider demonstrating to suppliers that factors such as performance, quality, safety and long-term commitment are being considered for supplier selection
  • Review the tendering process and tighten where necessary
  • Pay particular attention to continuing to act in a trustworthy manner; improving transparency and communication, as well as looking to work with suppliers collaboratively as a long-term partner

One supplier, quoted anonymously in the report, describes TfL’s innovation strategy as operating under a “fear of making mistakes” which prevents the operator from implementing new innovations.

Meanwhile several others bemoan TfL’s cost-focused procurement strategy, claiming that TfL “dissuades” its suppliers from presenting new ideas.

One supplier said: “We are in a market where TfL is very cost focused, lowest cost which requires us to hold back our best ideas when we tender.

“What you really want to be able to do is bring those ideas forward and share them but that can’t happen, it’s just a consequence of the way we tend to tender.”

The report adds: “Suppliers do not feel that TfL is open to different types of commercial proposals and it is those with a more direct cost impact that are better received.

“Others such as risk and reward sharing and joint projects and investments that require more thought and possibly a longer payback are not considered so readily.”

From the 36 suppliers who responded, TfL was given an overall performance score of 3.40, just below the Voice of the Supplier (VoS) industry average of 3.44. The score is worked out from a survey covering topics ranging from innovation and communication to management and procurement proceedures. 

Analysing the score, the report concludes: “An overall score of 3.40 indicates that many of your supplier relationships are likely to have challenges that are probably inhibiting performance and increasing risk.

“There will be significant room for improvement and the need to focus on both operational improvement and developing more positive behaviours.”

TfL scored particularly badly in relation to risk appetite (2.33), speed of decision making (2.36) and a timely tendering process (2.54).

The operator also scored below 3, in risk and reward sharing, adoption of new methods and planning and forecasting.

Meanwhile, TfL scored highly in relation to operational management (4.38), commercial and contractual matters (4.38) and providing health and safety information (4.19). 

The operator was also commended for payment, brand and reputation and trustworthiness. 

TfL chief procurement officer David Wylie said: “This internal report forms part of our continuing work to ensure we have a strong relationship with our supply chain, who support us in running and delivering a world class transport network. Our suppliers come from across the UK and help support economic growth both in London and across the country.

“While the report highlighted a number of positives about our relationship with suppliers, it also mentioned some areas where TfL could make improvements. We welcome all of the comments and contributions and we are already taking action where necessary to address them in the coming year.”

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