Problems arising on the Genesis Project

A number of problems were identified by interviewees and in a retrospective report compiled by the Production Manager, Mace Ltd (Mace, 1997). These problems were, very briefly: -

□ Failure to integrate decision-making fully; delay in obtaining Planning permission caused project progress to be interrupted.

□ Attendance at meetings by client representatives was not adequate for

decision-making and caused delay. Too many decisions subsequently

rescinded.

□ 3-D CAD modelling not successful; fell behind site progress; compatibility problems; resource hungry

□ Central project planning too time consuming, partly due to lack of user friendliness of software.

□ Procurement procedures did not lend themselves to Supply Chain Management (SCM).

□ Despite substantial time commitment to SCM by BAA, other actors felt that a full supply chain analysis had not been possible for all building elements. Mace felt that BAA needed training in SCM and that better prioritisation of these activities was necessary (Mace, 1997:64).

□ Insufficient resources were put into pre-planning of off-site activities.

□ Contractors did not understand conditions, and implications for relationships, imposed by the NEC form of contract, generally.

□ Use of standard components not possible because industry currently serving a predominantly bespoke approach. A number of elements of the building have to be bespoke (for example the structural frame).

□ IT knowledge and training within the team, together with some habitual behaviour, placed limitations on the use of a central, IT based, database for the project.

□ Simplification of construction process through the use of standard components and “Lego” style instruction sheets was not realised due to insufficient time and capacity to implement. Bar coding o f components did not provide any benefits at site level.

□ Lack of design co-ordination caused by late appointment of suppliers and lack of single point responsibility for design co-ordination (too much reliance on 3-D model to perform this function). Not all specialist suppliers had the design skills required to provide a “with design” service.

□ Safety and welfare arrangements were regarded as achieving statutory minimum requirements only (Mace, 1997:68).

□ Productivity savings not realised through monitoring on this initial scheme.

4.9

CONCLUSIONS

The Genesis project was a very bold step towards creating a new approach to construction procurement in the UK. The resulting approach approximates to a construction management system, with the client (BAA) acting as construction manager in collaboration with a core team of consultants and contractors. Each of the packages of work was let on a “with design” basis and all of the terms and roles associated with the project actors were changed, in comparison with a traditional approach.

The pilot project effectively implemented both Partnering and Supply Chain Management and reconfigured the design process so as to create work clusters. A very large and profitable client committed a huge amount of resources in order to make the experiment work. Very few other clients in the UK have the capacity to innovate, or attempt to innovate, in this way.

The Partnering aspects of the project appeared to have been broadly successful. Suppliers reported tangible benefits from the statement of intent (related to workload) given by BAA; the prospect of Terminal Five was clearly significant in creating enthusiasm for what constituted unconventional client requests. Openness, equality and the move away from traditional performance incentives, all appear to have been well received and to have contributed towards a positive attitude amongst project actors, particularly those involved in production.

Improved information flows and technology transfer appear to have been severely hampered by a lack of detailed knowledge of the attributes of the software used and a general lack of training and inclination towards this form of communication amongst the project team.

The experiment with Supply Chain Management appears to have been slightly

less successful. BAA invested considerable resources in the Supply Chain

Management aspects of the project. Notwithstanding this, all parties reported a

resource problem here. The client attempted to become involved in the

management of issues associated with activities occurring a long way down the supply chain from the position of the client. This raises the issue of whether SCM is achievable within the UK construction industry, or at least from the position of the client (this point is referred to again below). It is, however, certain that SCM is an activity that must be carried out by a central and powerful actor. It is felt to be unlikely that the necessary degree of authority and the potential financial capacity would be found outside of the client or main contractor organisation. In the case of the Genesis project, since there was no main contractor, the function of Supply Chain Manager had to be performed by the client.

The fiinctioning of construction supply chain management and the issue of the necessary centrality to fulfil this function had an important bearing on the case studies chose subsequently. Fortunately, it was possible to gain access to a project carried out by a prominent industry client, where the client performed the function of supply chain manager (Slough Estates case study - see Chapter Nine). It was also possible to identify a case study where the role of supply chain manager was allocated to the main contractor (Building Down Barriers project at Aldershot for Defence Estates - see Chapter 10).

The use of work or technology clusters for the purposes of design and co­ ordination was a bold step in 1997. The use of delivery teams (which were effectively clusters) for substructure/superstructure, car park and cores and retail constituted three rather large parcels of work in the context of a building that was not particularly complex or large.

There were relatively few problems associated directly with this initiative, although it must be recognised that design co-ordination was not considered successful by most interviewees. As a pilot for a significantly larger and more

complex project, it probably was reasonably successful. Both of the two new

procurem ent case studies (Chapters Nine and Ten), involved the use of clusters for design and site production co-ordination.

Finally

The Genesis Project was, at the time, considered extremely innovative and constituted a bold experiment in the introduction of three important new initiatives for UK construction; Partnering, Supply Chain Management and Clusters.

^ The primary research comprises four case studies. Two o f these (one each, private and public sector) were “controls”; the other two incorporated Partnering, Supply Chain management and clusters and are referred to as new procurement projects.

The radically new approach embedded within BAA’s World Class procurement that was piloted on the Genesis project was conceptually different to existing UK construction procurement in a number o f fundamental ways: -

□ The names and roles of the project actors had been changed so as to bear very little relationship to those existing at the time.

□ The new roles were a function of the new structures or team configurations within which the actors were being asked to operate. Most fundamentally, the client had cast itself in a pivotal role at the very centre of the supply chain management function.

□ Traditional construction contract relationships [including the new NEC form advocated by the Latham report (Latham, 1994)] were no longer applicable to this new form of procurement and did not describe adequately, or support these emerging new roles.

□ Traditional (financial) performance incentives were abandoned in favour of a formalised long-term relationship'".

□ Informal discussion provided an insight into the research issues arising, how best to carry out the research and how to analyse and present the results of the research.

Chapter Three outlined the concepts underpinning the responses of the UK construction industry, to pressures for reform in post Latham, post Egan Britain. This chapter describes the application of those principles to a pilot project carried out by one of the UK’s largest construction clients.

Having been prompted to formalise its partnering arrangements during the Genesis project, BAA launched its framework agreement system (BAA, 1997a); this system was a development of the Public sector list o f approved contractors, which dealt with the conditions o f partnering in some detail. Within less than a year (by December 1998) B A A ’s framework policy was receiving adverse comments from the industry after the organisation decided that 50% o f its partners would have to be dropped. (Building, 11/12/98 provides more details).

This pilot study constituted a unique configuration of firms, each with a substantially modified role, operating within the context of a project team. The next chapter (Five) develops a theoretical framework for the observation of these

emerging networks of relationships that constitute new procurement phenomena.

It is followed by a detailed methodology for the gathering of data, their and graphical presentation.

ChFIVE006R/R5/Jan2002