In selecting alliance partners, “the question was not who could produce the lowest end price, but who could bring the best skills and values,” says Keegan, formerly of eight2O.
In late 2012, Thames ran workshops at which rival teams undertook tasks while being monitored by behavioral consultants, says Keegan. “I’ve never been through anything as involved as that,” he adds.
Observed behaviors accounted for 70% of the bid score, he says. The remaining 30% covered commercial elements, such as back-office costs. Construction prices were excluded.
Since becoming preferred bidder some two years ago, eight2O began refining Thames’ proposed program, finding 8% savings in the first few months, says Keegan. This early contractor involvement also gave eight2O a running start in the investment cycle.
Each member of eight2O has its own open-book target-price contract, signed in January, in which it agrees to share any cost overruns or savings with Thames.
But all front-end thinking and planning, as well as work allocation, is handled jointly by the alliance, says Keegan.
As utility-work needs change from new capital projects to maintenance, the importance of collaboration with the supply chain rises, says Mark Enzer, global water leader at Mott MacDonald Group.
The design firm has a major supporting role on the Thames repair-and-maintenance alliance, among other investment-cycle contracts with other utilities.
In round terms, the U.K.’s annual investment in new water and wastewater infrastructure represents just 0.5% of assets already in the ground, estimates Enzer.
“When you get to the mature phase, the paradigm shifts,” he says.
Ratcliff believes that maximizing the performance of existing infrastructure requires the supply chain to develop an intimate knowledge of the assets.
That means “you have to work closely with the client," he adds.