Making it work

Is the public sector finally getting to grips with Rethinking Construction? According to recent research, it looks as though local authorities are getting the message about issues such as partnering and quality-before-price, even though they’re not always entirely successful in the delivery on the ground.

The study (carried out by BMG Research on behalf of the Local Government Task Force) included chief executive officers from 78 of the top 150 authorities and sector managers from 73 of the top 150. The aim of the study was to assess understanding of and commitment to Rethinking Construction principles at ceo level. It also tested application of the principles at manager level in a number of sectors including buildings capital, maintenance and repairs. The results of the research will provide a baseline to measure future progress.

Headline figures on the research show 85% of ceos confirm their authority’s procurement strategy explicitly states that contracts should not be let on price alone; almost 80% of sector managers say their authority has created relationships with main contractors that extend beyond the life of a single project; and over 80% of respondents regularly measure and benchmark using Key Performance Indicators.

Tim Byers, chairman of Local Government Task Force (LGTF) says that a lot has been done to educate local authority managers about Rethinking Construction over the past couple of years: “We have been targeting local government ceos and sector managers with electronic media and written materials, as well as conferences to point out the benefits they can expect from following Rethinking principles. For example, working in this way, my own authority has seen a 12% reduction in capital costs of construction – it’s not something you can argue with.”

Byers adds that other benefits can also be seen: “For example, we recently rebuilt a school and dealt with the teachers and pupils from the design stage. They felt more involved and the end product met their needs better.”

The key principles identified by the LGTF as demonstrating Rethinking Construction are:

• Quality not cost alone.
• Partnering not confrontation.
• Performance management.
• Customer focus.
• Innovation.
• Commitment to people.

Commitment to these principles is strong at the highest level, but application on the ground varies more widely – only 43% of sector managers have achieved a good degree of implementation. The two principles which cause most trouble are quality-not-cost and partnering. The price-led culture still pervades, with more than 40% of respondents letting one or two of their last three building capital projects on price alone.

The lack of a true partnering approach means that for most projects involvement with contractors is still relatively low: 20% of those surveyed don’t have long term relationships with main contractors. End-users, tenants, suppliers and sub-contractors are still not included at the design stage of most projects.

Innovation is another aspect of the Rethinking strategy which local authorities are finding it difficult to implement. While 83% said “innovation forms an explicit part of strategy to a large extent”, only half encourage contractor innovation through incentives.

One of the main challenges to making partnering and quality-led procurement work is the way money is allocated from central government. Byers explains: “Within our current system it is still easier to cut the costs of initial building, then pay more for maintenance. As national procurement champion [for the LGTF] I am working to change this and persuade government to make changes in the way payments are made.” However, he admits that making Treasury change its procedures is a struggle.

Meanwhile, the education continues, with information sharing a major part of this. “We are providing some practical toolkits. We are highlighting successful projects so that we can all learn from each other. In following the process we are still on a learning curve ourselves so we aren’t there yet.”