Last month I attended the 19th Annual Future of Utilities Conference in London and was part of a panel discussion looking at the topic of effective project management, along with representatives from UK Power Networks and Northern Ireland Water.
The question was asked of the panel – ‘do you think you’re managing capital projects as well as you could do?’ With various reports of late illustrating that anywhere between 30-40 percent of all capital projects are not delivered within time or budget, the general consensus was that improvements certainly need to be made here.
Following the session, we also heard from Terry Morgan, the man tasked with managing undoubtedly the biggest infrastructure project in Europe through his role as Chairman of Crossrail. He gave us his thoughts about working in partnership to deliver major infrastructure projects.
What fascinated me about Terry’s keynote is that he’s introduced some very interesting best-practice methodologies into the Crossrail project, such as cost performance index (CPI) and scheduled performance index (SPI), which are typically associated with the Aerospace & Defence sector, in order to measure the performance of contractors.
And given Terry’s extensive background in the A&D and automotive sectors, having held roles at BAE and Rover Group, it’s clear why he’s taken this approach.
From my perspective, this certainly makes sense for a project of this magnitude. First and foremost, if the contractors don’t perform well enough on the Crossrail development, there’s a risk they won’t win the next big project on the horizon.
This led me to think how the construction sector can learn from other industries to ensure best-practice is ensured. Crossrail, and other projects in this sector, typically haven’t used these types of methodologies, but this cross-pollination of best practice from A&D may be a sign of the future.
As I mentioned in my own presentation – embedded below and available on Slideshare – the construction sector needs to think about introducing an integrated approach to project management to ensure the project runs within timescales and doesn’t impact the UK tax payer. At the moment, this integrated approach tends to be an afterthought within the construction sector and I think we’re a long way off this approach. But the fact that Terry Morgan is implementing them on such a huge long-term project, is certainly a step in the right direction.
A couple of examples of our customers that are leading the way with an integrated approach to project management include the Norwegian power grid operator Statnett and European electricity transmission system operator Tennet, who are both using asset management and project management, integrated with finance systems.
While Babcock Marine is also taking an integrated approach as part of its role in the Aircraft Carrier Alliance (ACA) to build two Queen Elizabeth Class (QEC) aircraft carriers for the Royal Navy, we’re not seeing so much of this in the UK.
This then begs the question – what can the UK learn from other countries here as well?
Here’s my presentation deck, complete with my speaker’s notes, that also offers some thoughts on that question.