#339 Integrated Contracts and Innovative Delivery

Engineering Matters

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11d ago 40:41

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On two major road projects in the UK work was completed on time and under budget. But not every project can claim such success. Defects, delays and cost overruns plague projects around the world.

Projects such as those at Junction 10 on the M25 London orbital motorway, and on a stretch of the A19 near Teesside in England’s north east, are inherently complex. Every change will cause ripples throughout the supply chain, and potentially impact schedules and costs. But this, AtkinsRéalis’s Kelly Burdall argues, isn’t the root cause of the problem. Instead, she explains, we should look at the contract structures used on major projects.

Traditionally, each party to a contract—designers, lead contractors, other members of the supply chain—are paid on a time and materials basis. That means that every time a clash creates more work, or a change requires more materials, the parties are paid more. This disincentivises collaboration, and can be seen as rewarding failure and discouraging investment in more efficient ways of working.

A new type of contract encourages collaboration and innovation. Integrated contracts, like those developed under National Highways delivery integrated partnership model, set goals based on outcomes: all parties to the contract are rewarded for delivering on time, without defects, and within budget. This aligns incentives, encourages investment in innovation, and can even be adopted before a project is tendered.

Guests

Joe Chastney, head of digital transformation, Balfour Beatty

Scott Shaw, client director, AtkinsRéalis

James Butler, managing director of project & programme services (PPS), AtkinsRéalis

Kelly Burdall, Programme Lead, Consulting, Strategy and Advisory, AtkinsRéalis

References

ISO 44001 Collaborative business relationship management systems

Project13 An enterprise model for infrastructure delivery

NUAR UK National Underground Asset Register

UK National Infrastructure Pipeline

Partner

AtkinsRéalis is a world-leading professional services and project management company dedicated to engineering a better future for our planet and its people. Employing over 37,000 people across Canada, the US and Latin America, the UK and Ireland, and Asia, the Middle East, and Australia, AtkinsRéalis creates sustainable solutions that connect people, data and technology to transform the world’s infrastructure and energy systems.

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