This case study illustrates our experience of working with the NDA and Sellafield Ltd and our ability to enter a complex contractual environment at pace and with sensitivity, understand the issues and develop a few, straightforward recommendations that people could buy into.
The Infrastructure Strategic Alliance contract has major commercial and practical significance to the NDA and to SL. It is an innovative form of enduring collaborative management contract – a true alliance that demands a different approach compared with traditional “procure and deliver” process – based around trust, openness and shared incentives. At the time of its introduction neither the NDA nor SL were familiar with this approach.
All parties found this environment challenging. It was hard to change the previous culture and ways of working. The project ran into difficulties in its early years, in particular with defining a suitable baseline against which to measure a planned 40% schedule improvement and a 25% cost reduction.
Concerto led a mid-term assurance review of the ISA contract, with a view to assessing progress approaching the next contract renewal decision point. We were appointed as Review Team Leader for this work, with the remaining two members of the team drawn from the NDA and SL. Our terms of appointment were to follow the IPA assurance review techniques.
A major issue that we encountered was a polarisation of views that had built up over the years about the conduct of the contract. The NDA’s perceptions were different from the ISA’s which were in turn different from SL’s. We tackled this by interviewing a wide range of people – those closely associated with the project, those with oversight roles, suppliers within the alliance, those with corporate management responsibilities and those holding internal assurance roles. By interviewing widely, we were able to see varying perspectives and establish a rounded, balanced picture.
We found that the contract’s schedule and cost metrics had become less relevant as time had passed in relation to the original baselines. All parties realised this and the “elephant in the room” was the metrics’ gradual obsolescence. That being the case, the written reports that we received were less useful as a source of determining true progress than we had at first imagined. To overcome this, we ran “deep dives” to obtain live examples of current progress and to gain an understanding of possible replacement solutions for the metrics.
A fundamental challenge that we encountered was that at first glance the ISA appeared not to be performing that robustly. Several areas would normally be classed as “red” under the IPA’s categorisation. By the end of the fieldwork, however, we had reached the conclusion that the metrics were painting an irrelevant and potentially misleading adverse picture and that, actually, the ISA was close to performing as intended, after its initial difficulties. The metrics were not revealing the true position and we were able to convince the senior management, from the NDA, to SL, to the ISA, to the IPA, that this was the case and graded the contract as Amber-Green.
One might imagine on a contract of this size and complexity that a review of this nature would lead to numerous recommendations. One of our strengths is in distilling matters down to just a few, key, telling recommendations; in this instance we made six “critical” and three other recommendations. All parties accepted these, evidenced by the positive close-out meeting with the SRO, accompanied by key NDA and ISA management team members.
