Managing Consultant at LogiKal Projects
Project 13 has hit the ground running: with the driving force of the ICE behind it, major industry clients on board and early adopters reporting positive signs, this new approach to infrastructure project delivery is only going to increase in profile and proliferation across the construction industry.
What does this mean for your business, and what can you do now to prepare yourself for wide scale use of the Project 13 approach? Read on for further info…
What is Project 13?
As put by the ICE on the Project 13 website; “Project 13 is an industry-led response to infrastructure delivery models that fail not just clients and their suppliers, but also the operators and users of our infrastructure systems and networks.“
This comes in the form of a new way of thinking which seeks to “boost productivity in delivery, improve whole life outcomes in operation and support a more sustainable, innovative, highly skilled industry“; representing a move away from current transactional, short-term models to more collaborative, enterprise driven practices delivering long-term benefits to all parties.
The approach has been developed between the Infrastructure Client Group (with representation by experts from a range of high profile industry clients) and the ICE in response to poor productivity levels, low profit margins and low perceived value within the industry.
At its heart Project 13 is about moving away from the delivery of scope and instead towards the delivery of value by facilitating increased collaboration between project stakeholders. This is achieved through replacing multi-tiered commercial models with integrated organisations whose partners are commercially aligned and incentivised. Thus removing the potential for competing objectives and dispute, instead encouraging all parties to pull in the same direction.
Adoption of this new way of thinking is intended to encourage new approaches in leadership and governance; rewarding stakeholders for value added to the overall project objectives, rather than individual services provided.
One approach to delivery of this new operating model can be found within the new NEC4 Alliance Contract as launched June 2018; facilitating increased collaboration by engaging multiple partners within the supply chain under a single contract (it’s important to note though that Project 13 is more of a business model than a contract).
Why it matters to you!
Project 13 has been developed with the intention of provoking a shift in the fundamental ways that we do business across the industry, as such it’s critical for businesses to understand what it’s about and its practical implications, in order to maintain their competitiveness over the coming years.
Here’s eight reasons your business needs to prepare for Project 13 now, rather than waiting for it to impact you:
- Project 13 is already out there; a number of early adopters have already been working to the guidelines of Project 13, and they’re big fish: Anglian Water, Heathrow Expansion, the Environment Agency and the National Grid, so if you’re looking to work with the likes of them you’ll need to at least understand what Project 13 is about.
- It matters to your clients; regardless of the success or failure of the early adopters, Project 13 was developed with the input of major industry clients through the ICG. This means that Project 13 represents what these top clients are looking for, so understanding the details will position you well to work with them and provide insight into their changing needs.
- Existing models won’t deliver; it’s an increasingly held conception across the industry that existing delivery models do not facilitate sustainable working practices or the delivery of long-term value. As alternative models arise in line with Project 13 offering improved value realisation and long term benefits, current delivery models will no longer be seen as capable of delivering value for money.
- Supply chain power dynamics will change; the proposed enterprise structure brings suppliers (subcontractors) much closer to the owner (client) than in current delivery models; greatly increasing their stake in delivery, their negotiating power and moving away from a traditional, transactional approach to procurement.
- How you work with project stakeholders will change; an enterprise structure will also change the way in which you engage with other project stakeholders, especially if using the new NEC4 Alliance contract. Other contractors or subcontractors who would previously have been considered stakeholders may well now be partners within a single contract; necessitating collaborative practices that were previously encouraged.
- Performance measurement and payment will change; in this same vein performance measurement will be less concerned with how you are delivering discrete packages of work and instead how you and your partners are contributing to the overall achievement of the project objectives. This represents a significant shake-up of the existing practice. Following on from this payment mechanisms will inevitably change from existing norms in order to align with project objectives.
- It’ll bring a new approach to risk; the traditional approach of risk being transferred down the supply chain will come to an end. In recognition of the fact that regardless of who within the supply chain ‘owns’ the risk, the overall impact of risk remains with the owner, this practice will be replaced thus further strengthening delivery alignment with the owner’s overall project goals.
- You’ll need to work across alternative systems and platforms; partnerships formed within the enterprise structure will require improved communication between different businesses’ systems and platforms, and to achieve the highest level of collaboration, agreement within the partnership of a single preferred platform. This will require flexibility and staff proficiency across multiple software options.
In all, changes are coming to the way in which infrastructure projects are procured and delivered in the UK (and further-afield). To ensure your business is able to meet the changing needs of clients and delivery partners it is essential to understand these changes and prepare your business to flex with them, rather than resist them.
What can you do to prepare?
Get up to speed; there is a wealth of information available through the Project 13 website (www.p13.org.uk) or via the ICE portal (https://www.ice.org.uk/news-and-insight/project-13) and don’t forget to check out the Alliance contract from the NEC (https://www.neccontract.com/NEC4-Products/NEC4-Contracts/NEC4-Alliance-Contract).
Alternatively look out for dedicated briefing sessions from the ICE in your region.
Talk about it; engage clients, partners, colleagues and friends to get their perspective on what changes this could bring to the industry and what they’re doing to prepare for it. You might learn something from them, they might learn something from you, it may even throw up some new opportunities for business.
Prepare your team; ensure that members of your team or your business are aware of the potential for change too. They may not need to know the full details, but there are elements which will apply to pretty much everyone. By leading the conversations about Project 13 you can shape it positively and as an opportunity.
Get in touch; at LogiKal we see a wealth of opportunities for businesses to re-position themselves within the industry and form exciting, innovative partnerships in delivery of the Project 13 approach. As such we’ve spent time researching the topic and forming some ideas of how this could be achieved.
To find out more about the Project 13 approach and how it can help you, please get in touch with David Eveleigh directly using the form below: