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Delivering Estate Solutions to Defence Needs

Building Collaboration A toolkit based on experience Decision Making Community & Environment Shared Values

Customer & Stakeholder Management Innovation

Managing Change Problem Solving Team Working

Continuous Improvement Industrial & Employee Relations & HR Approach Factor

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Contents This report is a case study of contractor selection using ‘soft issues’ and developing collaborative working across public and private sector teams.

Acknowledgments: Editorial Board Martin Chambers Vice President Chartered Institute of Building John Doyle Collaboration Project Leader ITS John Forster Project Manager Interservefm Jayne Mallon Principal Consultant ITS John McMillan Principal Consultant ITS Richard Peart Commercial Policy Defence Estates Barry Sheahan Account Manager, MoD, North Schneider Electric Gary Ward Deputy Director, Estate Management, East Defence Estates

Foreword Tim Banfield, Director, NAO

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Executive Summary Pat Kenrick, Managing Director, ITS

2

Key Players ITS Development Consultancy Defence Estates The Participating Companies

3 4 4

Prime Contracting

5

Soft Issues Assessments Assessing Soft Issues The Assessment Centres The Assessment Approach and Scoring

6 7 8,9

Results & Analysis

10,11,12,13

Learning & Insight Participants Reactions Areas for Future Development

14 15

Key Steps

16,17,18,19

Post Award: Embedding Collaborative Working Building Collaboration Collaboration: Benefits Collaboration: Enablers Collaboration: Systems, Processes and Structures Collaboration: Measuring Effectiveness Collaboration: The Improvement Process Conclusions

20 21 21 22 22 23 23

MoD Commercial View Mike Pengelly DE Prime Contract Initiative

24

Bibliography

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(c) Crown Copyright/ITS 2006

Special thanks to: Designer Nagila Hussain Graphic Designer Interservefm

Research Ian Shepherd Senior Consultant ITS

The views expressed in this publication are not necessarily those of Defence Estates, ITS or the companies and organisations involved. Everycareistakentoensuretheaccuracyoftheeditorialmaterial,butneithertheEditorialteamnorthe copyrightowners can be held responsible for any inaccuracies therein. All Crown Copyrights are reserved. Individuals are authorised to reproduce textfortheirownindividualuse. Any other proposed reproduction requires theassentofITSorDefenceEstateswhere applicable. New ITSresearchonSoftIssuesAssessmentandworkinprogressonCollaboration issimilarlyprotected. Further information on this work can be obtained by contacting ITS via our website, through the collaboration email address below or by contacting an ITS office: www.itsconsult.com itscollaboration@itsconsult.com To contact Defence Estates: Kingston Road, Sutton Coldfield, West Midlands, B75 7RL Further information is available from www.intellectual-property.gov.uk.


Foreword The National Audit Office scrutinises public spending on behalf of Parliament. We certify the accounts of all Government departments and report to Parliament on the economy, efficiency and effectiveness with which departments have used their resources. We are totally independent of Government.

Drawing on evidence from overseas defence and commercial organisations and the best defence projects, we developed Gold Standard good practice criteria for Project Control which are illustrated by the pyramid opposite.

Traditionally most activity in managing major projects has focused on the top 3 levels. The strongest message emerging from our analysis is that it is the ‘softer’ factors about building and sustaining relationships upon which success is predicated.

In May 2005 we published the first in a series of reports examining the factors driving the successful delivery of major defence projects. The report covered Project Control and the conclusions are relevant to all public organisations where they work alongside industry on delivering major projects.

All four levels of the pyramid must function as a coherent whole if projects are to progress towards successful conclusions. However, the strongest message emerging from our analysis was that it is the ‘softer’ factors about building and sustaining relationships (the bottom level of the pyramid) upon which success is predicated. Without this strong foundation even projects which apply all of the right project management processes are unlikely to succeed.

NAO 2005

The case study presented in this report by Defence Estates and its partners is valuable on two counts; first it shows how ‘soft issues’ should be a key part of the partner procurement process and, second, how developing a collaborative working relationship can be an integral part of a systematic process. Our 2005 report (1) concluded that ‘establishing and sustaining the right cultural environment’ is the foundation of success. We commend the approaches being taken by Defence Estates and its partners and will look with interest to see how these translate into results in the future. Tim Banfield, Director, NAO

Reporting to enable strategic decisions Measuring progress and making decisions focussed on successful project delivery

Creating clear structures and boundaries

Establishing and sustaining the right cultural environment

Four Levels of Successful Project Control NAO 2005

Successful working relationships are characterised by soft factors such as team working, trust and honesty. When the department and its' industry partners on a project display these behaviours, they are more likely to develop a common understanding of the task, the progress being made and some early warning of problems.

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Executive Summary ‘Smart partnerships are built by design’ Effective collaborative working is an essential ingredient in successful long term contracts. Our research highlights the value of identifying the potential for effective collaboration during the procurement process and investing in its continuing development during the lifetime of a contract. This publication provides a practical guide for those involved in procuring or seeking long term contracts including PFI and PPP contracts and maximising effectiveness post contract award.

ITS has been working with DE since 2001 to develop a methodology for Soft Issues Assessment (SIA) as part of the selection process for Prime Contracts. This involved defining the areas for assessment, researching the competence descriptions and designing the assessment methodology. The assessment methodology reflects best practice from both competence assessment and assessment centres. The eleven SIA areas and the assessment methodology, tested in all of the DE Regional Prime Contracts (RPCs), are detailed in the report. The ITS Building Collaboration Conference in July 2005 confirmed the validity and usefulness of SIA as part of the selection process for Prime Contractors. It also highlighted the importance of collaborative working and the need for awareness and commitment to improvement on ‘soft issues’ from all involved in the contract-client, service user, prime contractor and their supply chain. It was recognised that ‘organisations create alliances but it is people who make partnerships’ . SIA provides a starting point, but the long term pay offs come from ensuring effective collaborative working throughout the life of the contract. ITS, in collaboration with its partners, is continuing to undertake research to create a framework for collaborative working linking enablers, benefits and business results, and an update on thisworkisincludedin the report. Pat Kenrick, Managing Director, ITS

The research highlights the value of identifying the potential for effective collaboration during the procurement process and investing in its continuing development during the lifetime of a contract.

Effective collaborative working is an essential ingredient in successful long term contracts.

Since the Strategic Defence Review in 1998, Defence Estates (DE) has been developing the concept of Prime Contracting as a strategic response to the challenge of providing effective management of construction and maintenance services. At the heart of Prime Contracting is the combination of a single point of responsibility and incentivisation with integrated and collaborative working along the supply chain. This requires significant capabilities to deal with the Soft Issues that deliver effective collaborative working.

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Key Players ITS Development Consultancy ITS is an independent consultancy specialising in ‘the development of people and organisations’. We work across the public and private sectors in the UK and internationally, focusing on the learning and performance issues involved in major structural, operational and cultural change. Our work on collaboration recognises that whilst businesses form alliances in order to achieve shared objectives, it is the people involved in these businesses who actually deliver the business gain. Given the growing pressure on partners to deliver integrated working practices at the start of a contract, collaborative working needs to be planned and developed systematically. It cannot be left to evolve in today's tough business environment. ITS, working with the private sector since 1959, has now worked with most central government departments on change and development priorities. Most of our government projects, whether in Defence, Health, Trade and Industry, Education and Skills, Communications, and Work and Pensions involve ITS working in partnership with internal change teams. ITS has worked with the Ministry of Defence and its agencies since the early 1990s, including working with Defence Estates to establish their organisational and management development programmes. Since 2001 ITS has assisted DE in the selection of their Prime Contract companies using ‘soft issues’ competences to assess potential cultural fit. We are now working with DE and industry in developing effective collaborative working relationships. We recognise that collaborative working is a core competence across the public and private sectors.

Since 2001 ITS has assisted DE in the selection of their Prime Contract companies using ‘soft issues’ competences to assess potential cultural fit. ITS is now working to develop collaboration post contract award. ITS work includes:-

Organisational development and renewal - helping clients develop the capability to meet the changing demands of their people, customers, suppliers, shareholders and society

Collaborative & Partnership working helping companies and government agencies to build effective delivery relationships, integrated project working and ensure effective partnerships and collaboration

Building performance cultures identifying and developing the culture and performance skills to provide an edge that customers value and competitors find difficult to copy

Management and leadership development - growing the management capability to lead organisations through change and ensure their on-going success

HRD infrastructure - designing the

ITS is one of very few organisations that combines the talent for designing and facilitating learning with the talent for identifying business problems and seeing what needs to be different.

organisational processes required to embed and sustain effective people development linked to business needs

ITS identifies the business issues AND gets the learning to happen that will resolve them.

ITS Client Survey, 2005

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Change management - designing and facilitating change programmes that engage people and ensure the smoothest possible implementation for restructuring, re-locations and mergers


Key Players Defence Estates (DE) Vision and Mission statements Our Vision "To provide an estate of the right size and quality, which is managed and developed effectively in line with acknowledged best practice, and is sensitive to social and environmental considerations". Our Mission "To deliver estate solutions to defence needs." To enable DE to meet its commitments it has put in place a series of Prime Contracts. There are 5 Regional Prime Contracts (RPCs) and 2 Functional Primes to act as ‘one-stop-shops’ for all estate services.

The Ministry of Defence (MoD) is one of the largest landowners in the UK with a diverse estate of some 240,000 hectares (1% of the UK mainland or similar in size to Staffordshire) more than any other Government department. The Defence Estates covers over 4000 sites, 1611 listed buildings and scheduled monuments and 179 Sites of Special Scientific Interest. The MoD's built estate occupies around 80,000 hectares. It comprises: • • • •

Naval bases Airfields Communications facilities Town centre careers offices

• Barracks/camps • Storage & Supply Depots • Family quarters • Research & Development Installations

Since 2005 DE is the Agency within MoD that is responsible for delivery of all estate services ranging from; new construction, refurbishment, repair & maintenance and land management. From April 2006 ‘ownership’ of the MoD estate will transfer to DE giving it full responsibility for the management of the estate as a corporate asset. The role of DE is to support and enhance military capability by providing and maintaining the estate and its infrastructure, including service family housing. The agency also provides specialist support to the MoD on issues such as estate policy and the agenda for Sustainable Development in Government.

The Participating Companies

ITS Building Collaboration Conference Warwick, July 2005

The companies contributing to this research have considerable experience in delivering a range of facilities management and construction services. They operate in both the private and public sectors in the United Kingdom and overseas. Collectively they employ some 115,000 people and have a cumulative annual turnover in the region of £7 billion. All the companies have been involved in tendering for one or more of the Defence Estates Regional or Functional Prime Contracts. Strategic and operational teams of their staff participated in the Soft Issues Assessments as part of the evaluation process for the contracts. As part of this research the companies provided feedback on the Soft Issues Assessment process. They have collaborated with ITS and Defence Estates in the production of this publication and have provided case studies to illustrate aspects of their 'soft issues' working. The range of services they deliver include: • • • • • • •

Building Maintenance Cleaning Design Estate Management Hospital Services Mechanical & Electrical Installation Project Management

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• • • • • • •

Security Services Catering Construction Energy Services Facilities Management Plant Maintenance Professional Advice


Prime Contracting Overview of Prime Contracting Background

Key challenges for DEwereovercoming a legacy of under-investment in the estate by addressing wastage; imprecise allocation of risk; vulnerability to fraud and malpractice; and lack of a single point of delivery. From this, Prime Contracting on the MoD estate was born.

Features of Prime Contracting Long Term Contracts - the Prime Contracts cover construction and maintenance and are generally let for a 7 year period with an option to extend by a further 3 years. This allows the Prime Contractor the opportunity to plan ahead sufficiently to manage scarce resources to best effect, produce a maintenance regime based on asset condition and select and integrate a robust supply chain. Significantly, it also reduces both the burden of tendering for a range of individual contracts and reduces the time to start new projects as principally only a target cost and delivery time has to be agreed. ‘Soft Issues’ - at the tender stage each bidder has to address the soft issues of the relationship and their contribution to the behaviour and values for collaborative working. These are tested in workshops and scored as part of the overall bid evaluation and marking. Efficiency & Value For Money (VFM) Targets - potential efficiencies and savings identified in industry studies by Latham and Egan in the 1990s were recognised by MoD and adopted into the Prime Contracting initiative along with internal objectives to improve overall VFM. Collaborative working and supply chain integration are the principal enablers to achieving these efficiency and value for money targets. Incentive Pricing - all Prime Contracts are based on a Maximum Price Target Cost incentive pricing mechanism. This provides a target cost for each project and if the Prime Contractors actual costs better this there is a share arrangement for the savings. However, there is an opposite arrangement should the Prime Contractor exceed the target cost with excess cost shared between both parties up to an agreed maximum. Additional costs beyond this maximum are entirely borne by the Prime Contractor.

Key contributors to successful delivery are also the behaviour and values adopted by those involved in the project, creating an environment that encourages collaborative working as a single team with a common objective.

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A Prime Contractor is one having single point of responsibility for the management and delivery of a project using a system of incentivisation and collaborative working to integrate the activities of its Supply Chain members to achieve a project that is on time, within budget and is in accordance with the specified outputs and is fit for purpose.

In the Strategic Defence Review (1998) Ministers recognised the importance of effective management of construction and maintenance services on its estate and charged DE with finding an improved procurement model. DE set out to develop a long-term response building upon experience gained fromMoD's equipment procurement programmes.

To achieve this vision how the Prime Contractor selects, manages and integrates his supply chain has a major impact on successful delivery. Similarly, the manner in which DE interacts with the End User (to define requirements) and translates this for the Prime Contractor is also critical. For UK-wide requirements 2 functional Prime Contracts have also been awarded covering Single Living Accommodation Modernisation (SLAM) and Service Families Housing.


Soft Issues Assessments Imagine you are a client with a major project or programme to deliver. You need a partner organisation to work alongside your team and bring complementary expertise or resource.

Once contractor selection is achieved, your partner may work with you over an extended period in a long-term contract or within a short and highly focussed period. Your partners' contribution will be essential and will make the difference between success and failure. The combined team will have diverse skills, perspectives, work backgrounds and often a very different type of organisational culture. The interplay between roles will often be complex. Nonetheless the combined team will need to work together as one effective team, striving for a single purpose, rather than a range of self-interests. Many of the future project tasks have been identified but unforeseen challenges lie ahead. The combined team will need to be decisive when encountering them, be effective at joint problem-solving and, at times, innovative in overcoming challenges when demand is high. Above all, the team will need to develop, maintain and demonstrate trust and respect for each other and share common values about work and working together. They will need to be ‘signed-up’ to a culture of collaborative working. In selecting your partner you will have assessed their technical and professional abilities, their organisational capacity to deliver and, of course, value for money! Much is hanging on this partnership and so it is inconceivable that you won't assess their ability to work effectively alongside your team and have a plan to systematically develop the collaborative relationship once the contract is formally established. Well actually it isn't that inconceivable! Despite the fact that 70% of partnerships and joint-ventures across organisations develop problems due to cultural fit and or ineffective collaboration, each year major long-term contracts are still let where partnerships are created on paper but without either effective assessment of the so-called ‘soft’ capabilities in these crucial areas or a systematic plan conceived to develop the relationship once the partnership is formally established.

Assessing ‘soft issues’ as part of the procurement process The MoD have for some time included Soft Issues Assessment within their procurement processes for contracts with long-term partners. The most common approaches to assessment in this area have been a combination of the company's written proposals, assessment via questionnaire and, of course, the interview. However, whilst valuable, these assessments do not take into account many of the competences required of an effective integrated team. Furthermore, it has long been recognised in selection practice for individuals, that the most reliable way to assess competence in these areas is to observe the competences in action. The ‘soft issues’ scored workshops used by DE focussed on observable and measurable competences, played out by real teams, working on realistic and potential future project challenges, and working alongside their potential future client team colleagues. In 2001, Defence Estates working with ITS, first introduced soft issues scored workshops as part of the selection process for the award of the Regional Prime Contract (RPC) for Scotland. Following its first use the ‘soft issues’ analysis used in Scotland underwent an ongoing process of improvement subsequently being used over the four years as a key part of each of the four remaining Regional Prime Contracts. The aim of the assessment approach was to ‘generate sufficient, reliable and valid information on the soft issues competences’ of the tendering companies and to highlight key areas for future development for the tender organisation should they be successful.

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Soft Issues Assessments The Assessment Centres Each bidding company or consortium separately participated in an assessment centre process. The assessment centres consisted of two separate workshops, each lasting a day. One workshop was for the company's senior management team associated with the project and one for an operational staff included supply chain representatives team. The workshop environment was usually ‘on site’ or had access to a site, for project for realism. Both teams drewmembers from the main prime contractor company or joint venture partnership together with representatives from their supply chain organisations. It was important that both groups included people who would have continuing and key roles in the project if successful in their bid. In each workshop the company teams were matched up with their potential future MoD teammembers at either strategic or operational levels.

Under a 25 year PFI arrangement, Interserve is working within an Estate Management Services Agreement providing a range of services to new and existing buildings associated with the redevelopment of the DSS/Inland Revenue Headquarters in Newcastle. In addition to the delivery of facilities management and construction services Interserve successfully managed to decant and move 12,000 staff as a part of the rationalisation of the Revenue's Newcastle and Washington sites; achieved with no loss of operational efficiency. Two key aspects of the contract were

Each workshop comprised a series of challenges designed to test out ‘soft issues’ competences and how the client and contractor teams worked together. The exercises involved a combination of realistic work related and non-work related challenges as well as collaboration and individual team working exercises. The challenges focussed upon how the company team performed alone in resolving problems, and how they worked alongside MoD personnel. ITS designed each workshop, bringing in MoD expertise in making the exercises realistic to reflect likely future business challenges. ITS facilitated each event to ensure a standardised approach was experienced by each company and that companies were treated consistently. In addition to the presented challenges, new ‘fast balls’ were introduced e.g. introducing last minute changes to requirements, emergency press attention etc. that needed to be resolved at the same time as the original issues. The added pressure tested the resilience of the teams, particularly in working alongside new colleagues.

Providing an Integrated Information Management System - Interserve established a responsive helpdesk facility to: •

Process reactive maintenance, emergency and general facilities management enquiries

Track the progress of maintenance enquiries and the delivery of services

Provide general advice regarding the delivery of services across the estate

Developing Integrated Delivery Solutions Working on a 24/7 basis Interserve's team of subcontracted and directly employed labour maintained continuity and avoided any disruption to the normal operation of the estate. The success in delivering the contract has been due to: •

extensive collaborative working between all stakeholders - a Joint Management Board provides a forum for achieving shared ownership and agreeing objectives.

regular open and honest communication between all parties

regular accurate information updates to all those involved with the delivery of services

ensuring that all customers, employees and supply chain partners benefitted equally

a single source of accurate data used to develop the strategy for the entire estate

The MoD teammade available the expert resources, (either face -to-face or via telephone) required by the Prime teams in resolving their challenges. Team members from MoD present on the event were available to work alongside the company team in jointly resolving problems, whilst additional personnel were available when role play characterswere needed to provide added realism and information.

Reviews by the National Audit Office and the Office of Government Commerce have both commented favourably on the contract.

The SI workshop highlighted some areas important to the IPT (client team) which were incorporated into our bid.

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Soft Issues Assessments This section describes the Soft Issues areas and approach taken.

Team Working

Managing Change

Customer & Stakeholder Management

Continuous Improvement

Problem Solving

To identify the areas for assessment, ITS undertook a literature review of best practice in effective team-working, and project working. ITS surveyed existing DE staff with experience in ‘partnership working’, to identify the attributes and skills they most valued in their partnering companies. The wider literature on procurement/selection was reviewed as well as ITS experience in working with business -to-business relationships in other sectors. Some of the ‘soft issues’ competences were highly specific to the organisational imperatives such as care for the environment. Ten main assessment areas were identified. The ten areas were prioritised and weighted according to their importance to meeting the business challenges seen to lie ahead for DE and their partners. For example team working was worth twice the amount of some competences. Factor X - An eleventh assessed area was identified mid way through the series of regional assessments - ‘Factor X’. Although only counting for a small fraction of the available marks, Factor X related to the indefinable sense of ‘fit’, i.e ‘can we work with them’ and other impressions not covered by the ten assessed areas.

The Assessment Approach and Scoring Decision Making

Industrial & Employee Relations & HR Approach

The output of the assessment was a numeric score out of a maximum of 1000, together with qualitative feedback on performance. Validity, objectivity and fairness in the assessment were critical, as was the need to provide a robust audit trail of evidence to support the final marks and comments. Each of the ten primary assessed areas contained four assessment criteria, and each of these contained indicative behaviours. See table 1.

Innovation

Each criterion was assessed using a matrix scoring approach similar to that used in the EFQM Excellence Model and performance was rated using the following scale:

Community & Environment

0 -10

marks

=

‘little or no evidence’ of the competence

11- 35

marks

=

‘some evidence’ of the competence

36- 60

marks

=

‘evidence’ of the competence

61- 85

marks

=

‘clear evidence’ of the competence

86 - 100 marks

=

‘comprehensive evidence’ of the competence

In the initial projects ITS provided the assessors, but to build internal capability, assessors were subsequently trained and drawn from MoD personnel and latterly customer organisation representatives. Each assessment centre was followed-up within 24 hours with a consensus scoring process to agree a final score for each assessed area and to record the agreed strengths and weaknesses. ITS provided the lead assessor role and facilitated the process of consensus. Assessment was made against the competences and scoring regime.

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Soft Issues Assessments The table below provides an illustration of one assessment area - ‘teamworking’. It shows one of the four assessed criteria and the linked indicative behaviours. Table 1 Area

Criteria

(A) TEAM WORKING How well do the A1) Clarity of team work objectives and together and an agreed plan demonstrate and process effective team for achieving behaviours, objectives paying attention to team, individual and task

Behaviour • Clarified and established the overall objectives • Involved all team in decision making • Agreed a plan of action • Established clear accountability for team members • Worked systematically to a/the plan • Agreed a process for achieving the task • Coordinated and integrated the work of team members • Monitored and measured progress to the plan and final results

In assessing each competence area, assessors were asked to consider 5 key features: Approach

Did the approach used by the team appear to be sound and thought through?

Behaviour

Were the indicative behaviours demonstrated by the team?

Consistency

To what extent were the practices/behaviours consistently practiced throughout the event?

Deployment

Were the behaviours deployed by all team members?

Evaluation

To what extent were the approaches reviewed and evaluated?

Improvement

Was there evidence of evaluation informing improvement in the approaches used?

The assessment centres were broken down into sessions. Each session focussed upon a number of defined assessment areas. Observations relating to the assessed areas were recorded in standardised record books against each of the competences. Each assessor marked independently. To ensure consistency each assessor had been trained in the approach, and followed a defined methodology and recording approach. This further ensured that assessment was made against the competences and scoring regime and not the comparative performance of each bidding company. At the end of the whole series of assessment centres, assessors moderated their scores across all groups. On completion of the assessment centres for all teams bidding for an RPC, assessors moderated their scores across all teams. Factor X, scored by those MoD members interacting with the company teams in the exercises, was captured separately, not divulged to the assessors, and added to the final scores at the end of the process. Each of the DE Regional Prime Contract teams chose its own combination of case studies, short exercises, role play and teamwork and various inventories to test the areas of competence. Different approaches to provide feedback to bidders have been used in each region. DE and customer organisation assessors were trained and briefed, as were role players, and ITS moderated the scoring process to reach consensus, and ensure consistency in the scoring process.

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During the procurement process for Regional Prime Contract East the Defence Estate's Integrated Project Team introduced pre-preferred bidder as an additional stage to the process. The pre-preferred bidder stage allowed Defence Estates to gain a better understanding of the bidders' proposals before selecting a preferred bidder. This was a collaborative process where Defence Estates and end-user representatives challenged the bidders' solutions through a series of workshops. These workshops focussed on areas of the proposals that were important to the Authority and required further clarity. Babcock DynCorp worked with the IPT during the workshops initially to clarify Defence Estate's understanding of our Tender Proposals and then as a joint exercise we developed scenarios to test this understanding. The technical scenarios were applied to our Technical Solution and from this all parties came to a common understanding of what was technically included in the Babcock DynCorp Proposal. Following this exercise all parties agreed who was best to manage any remaining risk. The immediate benefit of undertaking prepreferred bidder was that Defence Estates fully understood the scope of Babcock DynCorp proposals before the commencement of preferred bidder which allowed both parties to concentrate on the finer details of the contract. This early work has benefitted the contract enormously as a collaborative working environment was established at the outset. This has aided the development of areas such as mobilisation, which has been undertaken together so that the mobilisation programs of Defence Estates, the end-users, Babcock DynCorp and our Supply Chain are mutually beneficial.

Babcock DynCorp worked with the IPT during the workshops initially to clarify Defence Estate's understanding of our tender proposals...


Results & Analysis This section provides data resulting from the Soft Issues Assessments and highlights the usefulness of the approach.

In the early assessment centres, on completion of the assessment centre, feedback reports were provided to DE as the client. The eventual pattern of feedback involved three reports with different functions and DE reported these results to the participating companies in different ways: •

Client report (confidential to the client)

Company feedback (specific improvement feedback)

Client team report (improvement specific to the client team)

Report focus

Client report

Company report

Client team report

Analysis of comparative performance and detailed scoring across companies Identification of strengths and areas for improvement Specific development feedback for post contract award action

The client report provided a detailed account of each company's performance in relation to the specific competences, with scores for each competence area and an overall score. Its prime purpose was to provide an overall score for this area of assessment and contributed to the overall assessment marking system. At a basic level it provided a ‘best in class’ score overall and for the senior and operational teams separately. The provision of scores compared to a maximum available provided a marker on the extent to which a company delivered an excellent performance by the demonstration of ‘comprehensive’ or ‘clear evidence’ of exhibiting the competences in most or all areas. The chart below shows the performance of four companies/Joint Ventures in one assessment centre compared to the maximum score available. Chart 1

Final Scores for all Teams

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Results & Analysis Chart 2

Using data from the assessments we have highlighted some interesting patterns to draw attention to how data like this could be used post selection for development purposes to improve how DE and companies could work together effectively.

Company A - Performance

The scores in Chart 2 are from a company which performed in the middle range of soft issues competence and shows scope for development in most areas. The final report gave specific behavioural indications of strengths and areas for development. What is striking is the similarity between the senior team (1) and operational team scores (2). Whilst workshop 1 for the senior managers emphasised strategic challenges and workshop 2 for the operational team day-to-day issues, both workshops used the same competences. The degree of similarity could suggest a ‘true’ reading of general competence in this company. The relatively higher Factor X score (a subjective feel of ‘can we work with these people’ ), made by client personnel interacting with the company during the assessment centre, is interesting. Company B Performance

“ In Chart 3 above we can see significant differences in performance between the workshop 1 (strategic team) and workshop 2 (operational teams). In this circumstance ITS raised a question on whether the operational team would perform so well in circumstances where they were under the direct management of their senior managers when the project went live? If this company had won the bid the data suggests that there would be significant scope for development in the senior management team.

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Despite the fact that 70% of partnerships and mergers fail or develop problems due to cultural fit and teamworking breakdown, each year major contracts across the public and private sectors are let where partnerships are forged without effective assessment of capabilities in these crucial areas.

Chart 3

ITS 2004


Results & Analysis The five regional assessment centres each involved at least 2 teams from each of the bidding companies or joint ventures. Overall 15 companies took part across the five assessments. In all but one case, the company or Joint Venture scoring highest in the Soft Issues Assessments went on to win the overall contract!

Chart 4 shows a company performing strongly in all areas with similar scores across their senior and operational teams. Here the Factor X score is high, and is matched by similar scores from the assessors. This company went on to win the contract based on all the procurement assessment factors. Chart 4

Company C Performance

In May 2005 ITS re-evaluated all the data and discovered a number of clear trends.

The data in Chart 5 captures the highest scores, lowest scores and average scores across the companies' seniormanagement teams in three of the regional prime contests. The chart shows some considerable differences in performance on the day.

Chart 5

Senior Manager Scores in three Regional Prime Contests

We appreciate that the scores are never likely to reach 100% and that the assessment is a snap-shot under what could at best be described as artificial conditions. However, the margin for improvement, even in high scoring bidders, is often in the excess of 20% suggesting a need for development in the soft issues competences.

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Results & Analysis In Chart 6 below we present two winning companies. The scores achieved reflect creditable performances under assessment conditions; whilst we accept to some extent that it was an assessment environment, nevertheless we believe it can be shown that there is a gap between the actual and desired level of performance. Most of those companies taking part in these assessments left entirely happywithwhattheyhaddoneandhowtheyhadbehaved‘ontheday’.

Chart 6

Wishaw General Hospital Integrated Facilities Management - Serco's award winning partnership with Summit Healthcare and Lanarkshire Acute Hospitals NHS Trust. Effective team working as a tool for change management and quality service delivery in a health sector PFI.

Total Soft Issues Score, 2 Winning Companies

Over a period of one week in May 2001, two old hospitals closed and the new Wishaw General opened. Effective joint working made it a smooth transition, and the partnership has flourished, winning Serco the PFM Partners in PPP/PFI Award 2003. Co-operation: During the transition period Serco invested in a digital encrypted telephone system to aid communication between staff on the site, without risk of interference with hospital equipment. Both Summit and the Trust embraced the innovation, purchasing handsets on the same network.

The chart above not only shows the scope for improvement in two winning companies but where possibilities for internal benchmarking and best practice sharing could be effected across two suppliers.

Collaboration: The Trust, Summit and Serco recognise the value of collaboration, both in operational management and in strategic planning. For example, although Serco's contract is selfmonitoring, NHS staff are encouraged to feedback on standards of cleanliness during monitoring checks. The Trust also audits performance outcomes. This joint approach to performance management helps Serco to gauge customer satisfaction levels and target areas for improvement. Co-creation: Joint management arrangements at Wishaw have broken down inter-organisational barriers and created a focus on effective service delivery as a first priority. Managers plan jointly better ways to deliver the service. “The atmosphere in this impressive new PFI hospital was unlike any other hospital and demonstrated high standards of service and customer satisfaction. Serco staff work closely with the hospital providing an almost seamless service.” Judges' Notes, PFM Awards 2003

Value created from different partnership styles

Co-creating

Collaboration... An umbrella term for working together in a seamless team to common objectives that deliver benefit for all.

Collaborative Co-operative Confrontational

Compliant

Operational Partnerships

Strategic Alliances Strategic Partnerships

Mutual Trust

Constructing Excellence 2005

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Source: Model developed by the Serco Institute, based on work by Tony Lendrum, author of The Strategic Partnering Handbook


Learning & Insight

It presents the views and opinions of DE and industry on the Soft Issues Assessment process and its validity and value. It presents key areas for improvement for any future Soft Issues Assessment projects.

ITS undertook a review and evaluation of the SIA process. This involved interviewing representatives from all the participating companies, a survey of all DE team leaders involved in the assessments and the staging of a conference bringing together senior managers from the companies, DE/MoD, Government and Industry bodies.

Participants Reactions The feedback from the interviews, survey and conference endorsed the validity and usefulness of the SIA process for the main purpose of informing selection decisions. However many other benefits for clients and contractors were identified; • Providing a better understanding of each others priorities and drivers • Advanced insight into how individuals would fit into the team • Identification of potential strengths and development areas for the eventual team • Improvement in the quality of subsequent tender submissions dealing with soft issues Below are some representative comments provided by DE and Company Managers. “The findings of the workshops have been reflected and upheld by the rest of the evaluation process to date and by our (subsequent) working relationship with the company” “The process enabled both parties to assess the potential working relationship they could expect be going into and identify where strengths existed together with areas for development once contractsweresigned. It enabled relationships across the teams to be started and facilitated a better understanding of each organisations drivers and priorities. It gives a working insight into the team that is perhaps not always evident from the written tender submission.” Formanycompanies the process alerted them to the need to raise the priority of people development in the soft issues areas. In one company it kick-started the development of a management soft issues tool kit, whilst in another it informed their approach to developing relationships with the people in their supply chains. Some companies reported that the process improved their tender submission, particularly on where and how effective relationships would need to be developed if theyweresuccessful.

Feedback has been incorporated into the ongoing team development, it has also influenced the way we approach other large bids and projects, essentially putting in place more rigour into soft issues, team development etc.

This section reviews the lessons learned and the findings from the ITS follow-up of the companies and DE team members and the outcomes of a conference of all participants.

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Learning & Insight There were several key messages for the improvement or development of the approach; •

The need to evaluate the client-side contribution in the assessments

Inclusion of measures of collaborative working

Introduce the observation of teams working together during ‘real’ events e.g. in negotiation processes, industry days

Include the measurement of the results in resolving the case study challenges

Areas for Future Development The assessment areas were reviewed. Several additional areas for Soft Issues Assessment were proposed which included; •

The quality of leadership displayed in the teams

The willingness and ability to trust and engender trust

Communication skills

The quality of mutual support in problem solving

Dispute and conflict management skills and approach

Flexibility and willingness to work for a mutual ‘win-win’

Respect and recognition of others contribution and perspective

Honesty and openness

Service Channel In 2003, Service Channel, a joint venture between Carillion and Telewest Broadband was established to deliver all facilities management services to Telewest throughout the UK as part of a 5-year contract worth an estimated £90 million. The key to SC's success is the collaborative partnership environment created. The traditional client/contractor relationship has been replaced by the creation of one seamless SC team, which regularly reviews the KPIs generated from the performance management system. This single entity means that teamwork must prevail with everyone aware of problems and challenges, and involved in their resolution. This has been achieved through the following: • • • •

An equally strong view proposed is the need to extend the Soft Issues Assessment process to include the full procurement life cycle starting with Expressions of Interest and into the steady state delivery of the project. Linked to this is a proposal that the measurement, evaluation and improvement of collaborative working should be a specific performance measure within the project, regularly assessed with a linked improvement process and itself leading to evaluation on project completion and future Contract Extensions.

GCHQ In 2000 Carillion secured the £1.8bn GCHQ New Accommodation PFI Contract in Cheltenham with partners Group 4. This included a £350m new build accommodation headquarters building to house in excess of 4000 staff with state of the art IT to stringent security requirements. The key to opening the building on time and to budget was the use of a collaborative design process where the specific needs of numerous specialist users were coordinated by a joint team from Carillion and GCHQ. Design workshops under the management of the Carillion and GCHQ joint team, and attended by GCHQ specialists and Carillion's designers led to a progressive design sign off, construction followed and, prior to fit out of specialist infrastructure and furniture, collaborative unit visits led to greater visualistion of what the drawing meant leading to a high level of user satisfaction following occupation.

Structured 'matrix' management - all premises have a single point of contact for overall management of FM services. Stakeholder meetings - direct meetings with the key staff at individual building level. Forum meetings - enabling Telewest staff to provide direct feedback. Perception audits - regular studies with the end-users to gauge perceptions of SC and the services it delivers. Intranet - using both the web-based 'OneCall' service desk portal and the automated workflow notifications through Outlook.

It would be useful to have regular assessments of the relationship as it develops during the contract. (Company Manager)

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Key Steps This section summarises the Key Steps and Issues to be considered in setting up a Soft Issues Assessment Process.

Plan for appointment

5

Involves users, customers & stakeholder

Develop case studies Ensure consistency & fairness

Design assessment centre

Establish assessment areas Ensure an element of surprise

Start with the end in mind

Reports and feedback

Prepare for delivery

Train the assessors

3

2

1

4

6

Ensure those involved in SIA provide the verbal feedback

Review lessons learned

Key Steps 1. Establish the assessment areas and criteria, weightings and adjustments factors. In DE the ten primary assessment areas were informed by accepted good practice in joint working and the soft skills needed for complex, integrated-team projects. Most of the competences are likely to fit any large collaborative project. Some that were used were particular to the business priorities and issues of DE e.g. sensitivity to ‘community and environment’. To ensure fit within the specific client community the competences were cross-referenced with those considered valuable in wider MoD Departmental policies. The weightings given to each competence area reflected the particular priorities of DE, who made a judgement that 60/40 represented a sound weighting between Strategic and Operational teams contributions to the overall score. This ratio may differ in other circumstances. It is important that, when using this approach, the soft issue competences and weightings to be used are bespoke or tuned into the organisational challenges. Key stakeholders must be engaged in this process to ensure their interest and ownership. This may include customers, suppliers and client side staff.

Start with the end in mind Early on, think about how performance and feedback will be delivered and to whom. We found that it was important to ensure that those guiding and familiar with the process were involved in feedback.

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Key Steps 2. Design the assessment centre to cover the competences. The design of the assessment centre needs to provide a range of opportunities so that all the assessed areas are consistent, in proportion, and in relation to the importance/weightings given to them. The design must allow for different problem-solving styles which individuals and companies might adopt. Aquality assurance process is critical to validate each assessment session. Although the process is primarily evaluative the successful participation of people needs to be based on sound learning, development and engagement principles.

Ensure an element of surprise In this project we had many companies bid for successive contracts over the 3 years period. In some instances companies who had already experienced the process competed with some who were new to it. For fairness it is essential to vary the content and pattern of the assessed workshops so that each company comes to it unable to predict how the assessment will be carried out and gain unintended advantage.

Project SLAM is being successfully delivered by industry in true partnership with Defence Estates and the customer. Working together as Debut Services, Bovis Lend Lease Ltd. and Babcock Support Services Ltd. are delivering phase one of Defence Estates’ Single Living Accommodation Modernisation (SLAM) programme, helping Britain’s armed forces to improve their living quarters on a national scale and thereby retaining highly capable service personnel. • Integrated and co-located project team (IPT) – working collaboratively with Defence Estates and the customer • 100 Debut Services personnel – Bovis Lend Lease Ltd and Babcock Support Services Ltd • Over 1,000 supply chain members

3. Guide the development of the assessment case studies. A key feature of the assessment centres was the use of realistic case studies based on likely future project challenges. The case studies presented problems that encompassed technical as well as management challenges e.g. stakeholder and customer management. To ensure realism it is important to engage technical support in the development. ITS used customer and client staff as role players, briefing them closely, rehearsing rather than scripting them for the events. ITS prepared case studies and other team exercises to allow participants every opportunity to display their competences. Wherever possible the workshops were conducted in the clients offices to give a further aspect of realism.

Involve users, customers & stakeholder DE acts on behalf of its end user Customer - the Armed Services. Involving representation of the Customer base early on is important to build trust in the process and outcomes. In this project this involved approval of the methodology, technical input to create realistic case study challenges, active participation in the exercises and involvement in the process of assessment. Colleagues from commercial/contractual specialisations are important.

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• Integrated project delivery team – Debut project managers, Defence Estates’ project focal points and Project SLAM end user representatives

Partnering with the client. Of particular importance is the degree of partnering between Defence Estates and Debut. Inevitably each has a different culture and is driven by different business needs and imperatives. For a project of the scale and scope of SLAM, it is essential that the partners work together, understand each other and face issues as a team. This situation cannot be achieved without considerable work, commitment and willingness from each partner, requiring the eradication of old ideas and the adoption of new. That it has been achieved is a credit to all involved in developing the relationship to create a partnership which is recognised as a model for how prime contracts should work.


Key Steps

Successful working relationships are characterised by soft factors such as team working, trust and honesty. When the department and its industry partners on a project display these behaviours, they are more likely to develop a common understanding of the task, the progress being made and some early warning of problems.

NAO 2005

4. Training the assessors Assessors need to be good at observing behaviour, taking in information, writing up notes - all at one time! An interest in soft issues helps; building understanding of the competence areas and criteria was done through training and discussion. Assessors were put through some of the exercises, they discussed likely scenarios, and how to recognise reliable and useful evidence for the process - to ensure accuracy and consistency.

Ensure consistency, fairness and consensus In our model each observer scored independently. All activities need to be observed, some by more than one observer. At the end of each workshop, observers working independently write up their scores, noting supportive evidence and comments. Make sure all individual observations and initial scores are recorded and maintained for audit trail purposes. During the workshop an independent facilitator acts as coordinator and invigilator to ensure timekeeping, fairness and consistency. Variations from plan are noted, discussed and if necessary accounted for in the moderation process. Briefing the various ‘players’ and customer-team members' to ensure they play a consistent role across several assessed workshops is important.

5.

Prepare to deliver the workshops

Ensure that you brief all concerned on dates and issue joining instructions to bidding companies in good time. Stipulate the number of staff who should attend-representatives from an appropriate mix of functions and supply chain if appropriate. Sort out all the essential basics. e.g advanced preparation for bidding companies, and ensure a fit for purpose assessment environment. Remember that the initial reception and welcome arrangements can set the tone and climate for a successfulworkshop.

Involves users, customers & stakeholder

Develop case studies

Design assessment centre

Establish assessment areas

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Key Steps 6. Deliver reports and feedback Although this might look like ‘the end’, decide how you're going to do this up front. It's important to clarify how much information you need to give ‘management’, and to the companies. Be clear about the content and formats from the outset - it'll save you valuable time. How much feedback can the companies take? You'll want to be constructive, yet honest.

Plan for the eventual appointment and a successful long term relationship

Regional Prime Contract Scotland

The assessment process yields considerable information on strengths and areas for development for the company, the client team and them together. The value that this can bring to kick starting a development process for building collaboration post-award, or, if it exists, in any intermediate stage such as 'Preferred Bidder', is considerable.

Regional Prime Contract Scotland was awarded by Defence Estates (DE) to AMEC Turner as the first of five Regional Contracts to be placed across the UK to enable DE to achieve their mission of "Delivering an Estate of the right size and right quality" for the Ministry of Defence. A key to the successful delivery of this contract is an integrated team approach in working towards common goals.

Plan for an early re-consideration of the data. This should be part of a process of collaborative team development. Soft Issues Assessment for contract award is just the start of placing people at the heart of a successful project.

RPCS is managed by a Strategic Management Board comprising senior personnel from both Defence Estates and AMEC Turner. Over the past eighteen months, the team has worked together to develop a Business Delivery Model supported by integrated processes and management tools. DELIVER

ENABLE RPC(S) Step 1 Business Planning

Review lessons learned Keep a learning log as you go; and hold a formal review to share lessons learned. Be prepared to evaluate the project and process - but also include what you have learned about soft issues.

DefenceEstates Step 2 Customer & Stakeholder Management

DefenceEstates Step 3

EstatePlanning

Identification o f requirements

Mission

IndentifyAim

Vision

Clarifystructure

StrategicGoals

Clarifylead responsibilities

TargetCondition System

Communication requirements

IEMP's

Policy&Strategy Structure Culture Continuous Improvement Regime Communication

Informationrequirements ConfirmationSurvey

AMECTurner Step 4 PlanningFor Delivery Optioneering Maintenance, Inspection & TestingRegime Improve Pricing SupplyChain Development Estate Works Programme TargetImprovement

AMECTurner Step 5

Delivery

Maintain Works Programme Operations SupplyChain Management Audits&Checks

VERIFY

A significant benefit of the model is the clarification of roles and responsibilities of both organisations and individuals involved in the contract. Each step of the process is led by a senior manager from either DE or AMEC Turner with the exception of step 1 which is jointly led. This clearly illustrates that, within the partnership, DE's main responsibility is for enablement and AMEC Turner's main responsibility is for delivery. Trust in the joint underlying processes ensures that there is no duplication of effort and this results in an efficient and effective service to the customer.

Reports and feedback

Prepare for delivery

This Business Delivery Model has been recognised as best practice by DE Director General Operations and will be adopted across his sphere of responsibility with initial roll out to the other four Regional Prime Contracts.

Train the assessors

Review lessons learned

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Post Award: Embedding Collaborative Working This section describes the approach we have taken to develop and improve the quality of collaborative working post contract award.

Building Collaboration The achievement of business results demands the realisation of effective joint working, which this research defines as Collaboration Benefits. These benefits can only be realised if certain enablers are in place. Fig 1. Enablers - Benefits - Results

Enablers

Collaboration Benefits

Business Results

Learning and Continuous Improvement However the extent of investment in developing collaborative working and the effort needed in implementing the ‘enablers’ and delivering the ‘benefits’ will depend on the nature of the intended collaboration. The diagram below describes several forms of collaborative relationship starting with ‘Communication’. Typically this is where collaboration extends to information being informally shared, often in a non-systematic way. ‘Cooperation’, is a step up and involves a closer working relationship on sometimes mutually defined problems or opportunities but doesn't extend to the sharing of resources or the planned co-ordination of actions as in the ‘co-ordination’ model. The ‘Federation’ approach includes high levels of co-ordination of people and systems and the additional factor of the joint development and implementation of long term strategy. The ‘Merger’model goes beyond this to the full integration of the organisations' people and systems in pursuit of common goals. Fig 2. Hierarchy of Collaboration

High Merger Federation Co-ordination Co-operation Communication

High

Low Need for benefits of collaboration to be realised

Increasingly, the relationships between Government and their industry partners demand a bespoke arrangement - going beyond ‘Federation’ but falling short of ‘Merger’.

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Post Award: Embedding Collaborative Working When these potential benefits are recognised as critical success factors and the risks of their non-realisation deemed equally significant by all parties then a systematic process of developing and improving collaboration is needed. ‘Smart partnerships are built by design and not through evolution’ (2) In the case of DE and its Prime Contractors, long term, non-adversarial relationships are envisaged with expectations of highly integrated working between people, supported by systems and structures to facilitate collaboration that delivers business results. During 2005 ITS undertook wide ranging research into effective partnering across ITS' client base, and reviewed the lessons learned by NAO (1) and the OGC (3), as well as the UK construction industry itself (4). ITS captured the lessons learned in a collaboration conference (5). The model of ‘Enablers’ and ‘Benefits’ that has emerged is a ‘work in progress’ but early results in using the approach in one Prime Contract region is showing a positive impact.

Collaboration: Benefits We have listed the identified ‘benefits’ opposite C-BR (Collaboration Benefits Realisation). Although the identified Benefits are likely to be relevant across all situations, the criticality of each may vary across particular circumstances and projects. Obtaining the agreement of the members of the partnership to those benefits that are most important to the desired business results is a key initial step in developing the relationship (6). Those identified by ITS in its most recent work are contained in a new framework.

Collaboration: Enablers If the Benefits are seen as the outcomes of behaviours and actions already taken by people, then the ‘enablers’, are the actions that people take to bring about the Benefits. Our approach takes the view that ‘Organisations create alliances but it is people who make partnerships’ (2), therefore it is not surprising that the majority of the ‘enablers’ we have identified are rooted in behaviours and attitudes which are then supported by collaborative systems, processes and structures. At the earliest point after partner selection, the collaboration vision and the desired benefits of effective collaborative working need to be confirmed along with their key ‘enablers’. These enablers will become the essential foundations of success when built into a development plan that will lead to continuous improvement throughout the life of the project.

Measurement of client-contractor relationships.

Regular independent assessments of clientcontractor relationships as they develop.

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C-BR Collaboration Benefits Realisation

1. There is a strong and healthy trust and respect between the partners. 2. We work with each other as partners, not adversaries. 3. There is openness, honesty and sharing of information. 4. We share common objectives and purposes. 5. We focus on the common good not our specific organisational interests. 6. We are fully and appropriately involved in any decisions made. 7. Communication between partners is effective and there are no surprises. 8. All parties keep promises and arrangements. 9. The social interaction between parties adds value to the partnership. 10. Everybody fully understands their own and each others roles, responsibilities and boundaries. 11. Every individual is open to constructive feedback. 12. You receive constructive feedback from the partner. 13. There is always a 'win-win' approach when dealing with the partner. 14. Senior managers are adept at looking to the future and thinking strategically. 15. You are able to rely on your partner to work jointly with you. 16. You are able to rely on your partner to complete work separately from you, where appropriate. 17. Systems and processes in the partner organisations are adequately joined up. 18. Where conflict occurs, it is managed very effectively. 19. The partner organisations act like a single team when interacting with the customer. 20. Your partner is willing to change personal/organisational practices for the common/customer good. 21. The partner is understanding and responsive to our needs. 22. Our partners are output and delivery driven. 23. Our partners are reliable and consistent.


Post Award: Embedding Collaborative Working For each of the behavioural ‘enablers’ ITS have identified a set of specific behaviours or attitudes that need to be adopted by the members of the relationship.

What stands out amongst these behavioural ‘enablers’ is the link to TRUST. Recent international research on business behaviours* and impact on corporate effectiveness has identified ‘trust’ as crucial (7). Seven of the behaviours and attitudes opposite directly impact the sense of trust we engender in our partners.

The broad areas are summarised below:

Collaboration: Systems, Processes and Structures

• •

• •

• • • • •

Ability and willingness to trust others A win - win*, unselfish approach taken by the parties to problem solving and sharing of risk Openness and honesty* in business dealings and in giving and receiving performance feedback Delivery of promises* Valuing and respecting* others competences and difference, Consistency and reliability* in delivery An eye on the future and willingness to change long-held practices when needed Being part of the team - willingness to be dependent on others Being seen to act professionally competent and credible* Timely and relevant communication and inclusion Commitment to the collaboration Respect and empathy for others*

Behaviours are clearly indicative of organisational culture. But so too are systems, processes and structures. How far one aligns and integrates them across organisations in a partnership will depend on the type of collaboration envisaged - ‘Communication’ through to ‘Merger’. The extent of integrationmay include: • • • • • • •

Shared communication channels Integrated project, business and strategic planning Aligned management information and performance management systems Unified management arrangements Common training and development plans Co-location Jointly defined roles, responsibilities and delegation policy

Working with DE and its partners, ITS have sought to determine a range of systems and processes to underpin collaborative working and which are important for business results.

Collaboration:Measuring Effectiveness The NAO ‘Gold Standard’ (1) for effective Project Control identifies good practice drawn from their research and bench-marking. They recommend ‘regular independent assessments of client-contractor relationships as they develop during a project’. ITS are piloting such an assessment system. The basis of this is the regular measurement of ‘Benefits’ being realised, together with metrics linked to both enabling behaviours and systems. The three following charts are illustrative only and do not relate to any particular clientcontractor relationship in this project. Chart 6 illustrates the type of data being used to measure Benefits Realisation. Chart 6 Collaboration Benefits Partner gives feedback Partner accepts feedback

Understanding roles & responsibilities Social interaction adds value Promises kept Effective Communication Involved in decisions Focus on common good

Client Contractor

Common objectives Honest & open Partners not adversaries Trust & respect 0

0.5

1

1.5

2

2.5

3

3.5

Rating (1=Strongly Disagree; 6= Strongly Agree)

Chart 6 shows performance in relation to some of the ‘benefits’, detailed in the column.

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4


Post Award: Embedding Collaborative Working Chart 7 below provides feedback on some of the behavioural enablers. This chart focuses on behaviours linked to trust and how each party views the other. Performance improvement will be indicated by the meeting together of the parties in the centre of the graph. The ability to focus down at area or team level provides specific data for local action to build and improve collaboration. Chart 7 Collaboration Factors Client views Contractor 0

5

10

15 16.5

20

Contractor views Client 25

30

25

20

15

10

Trust Win - Win

15.6

Openness & honesty

14

15.4

Delivery on promises

13.8

Consistency

13

16.4

Eye on the future/ willingness to change

10.1 15.8 18.2 13.8 14

13.8

Competent & credible

Commitment

With a range of customers/stakeholders determine the key collaboration benefits for the project

Identify and agree the key enablers behavioural and systems

Baseline the current position

Identify overall Areas for Improvement and agree improvement goals/targets

Identify personal and/or team or acrossteam improvement implications

Improvement strategies (1:1 coaching, mentoring, team-building, conflict resolution, systems development etc.)

Keep on top of it - regular management review

Remeasure linked to the business planning cycle (linking to business results)

Highlight, communicate and celebrate achievements

Institutionalise the metrics as part of a balanced scorecard of performance management and improvement process

Publish agreed targets and timescale for improving scores

Publish an agreed action plan to achieve desired improvement

9.8

Be dependent on others

Communication & inclusion

0

The assessment system recently piloted by ITS follows several key stages in the development process of working towards the creation of a ‘collaborative’ environment.

11.2 14.8

11

5

Collaboration: The Improvement Process

15.1 17 15.2

Chart 8 illustrates an aggregated 360 degree feedback analysis of senior managers' preferences for collaboration. The ability to disaggregate the overall data and focus on individuals and specific relationships facilitates 1:1, and relational coaching and development designed to improve the quality of collaborative working. Chart 8 Personal Orientation to Collaboration

Conclusions Although still in the early stages the work is demonstrating that there is significant value to be gained by building and improving effective collaboration in a systematic manner. As with the Soft Issues Assessment, the use of common metrics in this area across similar projects could facilitate internal benchmarking and improvement across projects. If adopted, this approach places the measurement and improvement of collaborative working at the heart of business success. A further report will be published to describe the progress of the pilot and the results achieved.

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MoD Commercial View DE Prime Contract Initiative From the DE perspective, Prime Contracting has been the major catalyst for changing DE's role from being a mere Advisory service to becoming the premier delivery organisation for Estate outcomeswithin MoD. Through Prime Contracting we have introduced best practice from other parts of MoD, in particular the concept of collaborative working, integrated project teams and clear allocation of responsibilities. A consequence of Prime Contracting is that we have drastically reduced our supplier base and this provides us with a valuable opportunity to develop strategic relationships with our suppliers. No longer will we see the ‘fire and forget’ approach of creating teams and supply chains for each project and the historical adversarial approach of bid low and make-up the shortfall through variations. With Prime Contracting there are fewer, longer, higher value contracts which provides the opportunity to help introduce positive changes to the industry that will be mutually beneficial. The real improvements will be seen from continuity and improved relationships. The creation of Prime Contracts puts increased emphasis on Supply Chain management and its here where we see the greatest challenge. Subcontractors are the work-engine that will make Prime Contracting a success and it is fundamental that the Prime Contractor creates the right environment for this to mature. This includes getting the subcontractor to buy into what we are trying to achieve and to generate efficiencies. For this to happen the environment has to be right, he needs to be paid on time, feel part of the team and be valued. It's here where we will see the greatest test of the application of soft skills on what has been in the past a very hard interface between Main and subcontractors. Time will tell whether our approach to finding the right fit of contractor to take on the role of Prime is successful. However early indications are that the work done on building a strategic relationship at board level and by the IPTs to develop collaborative working and team spirit, and cascade this down the supply chain, are already paying dividends. This is the start of a very exciting journey, not only for DE and our Primes, but the industry at large. There is clear evidence of an energy and willingness from all involved in PrimeContracting that wemustharness and develop.

It's here where we will see the greatest test of the application of soft skills on what has been in the past a very hard interface between Main and Subcontractors.

No longer will we see the "fire and forget" approach of creating teams and supply chains for each project and the historical adversarial approach of bid low and make-up the shortfall through variations.

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Bibliography (1) National Audit Office (2005) Driving the Successful Delivery of Major Defence Projects: Effective Project Control is a Key factor in Successful Projects. Pub NAO. (2) Dent, SM & Naiman, SM (2002) Partnering Intelligence Field Book. Pub Davies - Black (3) Office for Government Commerce (OGC), (2003) Effective Partnering: An Overview for Customers and Suppliers. Pub HM Treasury. (4) Constructing Excellence. (2005) Supply Chain Partnering. (*one of a series of related reports). Pub Constructing Excellence. (5) ITS (2005) Soft Issues & Building Collaboration Conference Report. Pub International Training Service Ltd. (6) Fasel, D.K. (2000) Partnering in Action: A guide for building successful collaboration across organisational boundaries. Pub Pathways. (7) Bibb, S & Kourdi, J (2004). Trust Matters for Organisational and Personal Success. Pub Palgrave Macmillan.


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359_Building Collaboration