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Trust the supply chain to bring on innovation

Mark Hansford

A delicious irony presented itself to me at the ICE last week. High Speed 2 (HS2) boss, Simon Kirby was standing on stage extolling the virtue of a new lean, mean construction industry.

What a time to receive an email hot from the rail regulator telling me that Kirby’s former charges at Network Rail had missed their five-year efficiency target by a country mile. Extraordinary!

Extraordinary, but true. For the recently completed 2009-2014 control period Network Rail’s 15.5% cost saving was eight whole percentage points shy of its target.

Whether it was sheer devilment that the regulator chose to release its assessment at the exact moment Kirby and his colleagues on the newly-named Infrastructure Client Group were talking up achievements over the past three years - and promising even more over the three years to come - we will probably never know. But the timing was ironic.

Network Rail spent £1.2bn more on operating, maintaining and renewing the network - and financing costs - than it expected to.

Why? I’m sure there are lots of reasons. But, in his speech at the ICE, Kirby gave one big clue. “Our approach to design and construction is fast becoming dated,” he said. “Technologies offer ways to change how we deliver - if we let them. In rail, new technology is always considered by people - who are probably too risk averse - to be too risky,” he said, insisting that HS2 would be very different.

But can we really believe that? On current form there is not a lot of evidence.

In highways, the view is that innovation will only ever be welcomed if it comes with a long-term guarantee. In rail standards, safety cases and complex interfaces have always stood in the way.

Only London Underground has really made progress here, its Incentivised Contractor Engagement procurement for the Bank Station upgrade yielding some genuinely innovative solutions.

And therein lies some real hope.

Kirby was launching a new three-year programme of work to improve project delivery. One key project within that will be looking at how collaborative project teams use technology. It will be led by Bank station boss, London Underground programme director for Crossrail and stations Miles Ashley. He’s clear about the need for more technology, and that procurement methods must change to allow it.

It’s pretty simple really. If clients keep asking for a supply chain to price lumps of concrete, they are going to keep getting lumps of concrete.

And if they keep asking for the cheapest possible lumps of concrete, well, they’re going to keep getting lumps of concrete marginally cheaper than the last time they asked for some. Marginal gains if they’re lucky. Uncertain project delivery if they’re not.

Instead they must find a way of procuring that allows them to put their trust in the supply chain. Trust them with what their need is - really is - and trust them to come back with a solution that genuinely solves it.

Doing that will unleash the engineering skill that is currently so disenfranchised within our industry.

It will also deliver some truly wonderful solutions and allow Network Rail to hit its numbers.

Future irony can be averted.

  • Mark Hansford is NCE’s editor

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