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Crossrail restructure heralds new phase

Crossrail has completed a restructuring of its client team that will see project promoter Crossrail Limited, project delivery partner Crossrail Central and programme partner Transcend working together as one organisation led by programme director Andy Mitchell.

“Absolute clarity”

Mitchell said the move would “eliminate duplication of roles” and provide “absolute clarity on who is responsible for what”.

It has resulted in the departure of Crossrail Central project director Cliff Mumm, who has returned to the United States. Transcend director Jhan Schmidt had already left the project.

Mitchell said the new structure − which is similar to that of Olympic delivery partner CLM − will see Crossrail Central and Transcend continue to play leading roles in the delivery of the project. Crossrail Central is a joint venture between Bechtel, Halcrow and Systra. Transcend is a joint venture led by CH2M Hill, Nichols Group and Aecom.

“One of the things we have been trying to do is reduce the headcount and we have had some redundancies and redeployments but the overall ratios haven’t really changed,” said Mitchell.

Crossrail contracts

Mitchell said the 800-strong integrated team now comprises 300 staff from Crossrail Limited, 50 to 60 from Transcend and 550 from Crossrail Central.

Sources told NCE last month that Crossrail Central’s £400M contract and Transcend’s £100M contract were being scaled back because the firms had failed to contribute enough innovation to the scheme (NCE 31 March).
Mitchell explained that the change in management structure was driven largely by the project moving from design phase to construction.

“The last two years have seen a rapid ramp-up and at the time having Crossrail Central and Transcend was a good way of mobilising resources in a short space of time,” he said.

“But we are now coming off the peak of design management and moving to four years of civil engineering construction,” he said. “And we are trying to get an organisation with no duplication and absolute clarity of roles.”

Management team shifted into place

Mitchell will now lead a programme management team with directors taking charge of individual projects and specific roles such as health and safety (see box).

The new team

Bechtel’s Ailie MacAdam remains on the project as central section delivery director. Bechtel’s Bill Tucker also remains involved as area director central.

“We’re doing what was always the intent, and that’s to engage world class companies and people,” said Mitchell.

“The new structure feels right and is the way I wanted it to be. Now it is really for us to knuckle down as increasingly it is not about us but about our contractors.”

Final Treasury check complete

The restructuring was announced last week after the project passed its final Treasury check. Now Mitchell and the Crossrail board have complete control over the project.

Crossrail can now award contracts without the approval of its sponsors Transport for London and the Department for Transport.

It marked this freedom by confirming that the Thames Tunnel will be built by a joint venture of Hochtief and
J Murphy, as revealed in NCE last month. It also confirmed that the Connaught tunnel refurbishment in east London will be carried out by Vinci Construction UK.

The new integrated structure firmly places responsibility for construction progress along with the management of project risks that could affect delivery on onto contractors.

“We expect contractors to do what the contract calls for them to do”

Andy Mitchell

“We have a very unaltered form of NEC contract and we expect contractors to do what the contract calls for them to do − the safe management and coordination of the works,” said Mitchell.

But he stressed that Crossrail was still keen to work with contractors to identify further savings on top of the £1.5bn revealed in December (NCE 16 December 2010).

Contractors successful in the first round of tunnelling contract awards last December are currently in the midst of a 120 day mobilisation phase that includes a 90 day “optimised contractor involvement” stage where value engineering proposals can be put on the table.

“We went through a fairly intensive value engineering process but some of the things we identified really couldn’t be resolved until we got the contractors on board,” Mitchell said.

“Now we’ve got them on board, we have been getting value out of them.”

“Good ideas” to come

He said last month saw the last “good ideas day” and that he was now working through the results to see which will be implemented.

“Next month you will see some consolidation of these ideas and I can see already that there are some significant cost savings to come,” he said.

Mitchell said the intention was not necessarily to bring the £14.5bn target price down, but to create greater headroom within it.

He also stressed that the intention was not to squeeze contractor margins.

“What we have done is to make sure that the contractors are profitable, because a non-profitable contractor is an unhappy animal,” he said. Mitchell said that contractors would be encouraged to support the Tunnelling Academy and Crossrail’s efforts to encourage apprentices.

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