Delivery partner principles: a positive contribution to a global industry
The global construction market is set to grow by US$4.5trillion between 2020 and 2030.
Much of this demand will come in the form of major projects that support fast growing and rapidly urbanising populations across the developing world. Whether this is via urban residential schemes or improvements to transport and other critical infrastructure, our towns and cities present a considerable challenge and opportunity.
The pace of this growth, combined with less-mature in-country construction experience across the developing world, means that established international companies with a track record of delivery have a role to play.
In this article, Caroline Lassen, Mace Consult’s Global Lead for Programme, Project and Construction Management, explains how the delivery partner model can achieve the collaboration needed between home nation and overseas support to ensure growth is sustainable over the long term.
Structured for success
The challenges of rapid urbanisation are large enough in scale and complexity to warrant movement towards alliancing models. However, clients in many of these cases will be government departments, likely to be overstretched already, with other responsibilities and lacking the expertise needed to effectively manage alliancing relationships.
This is where the delivery partner model comes in. It balances existing positives, like the alliance-style incentive mechanisms, against fresh perspectives, such as placing less onus on the client team. This doesn’t mean a diminishing of client responsibility, rather it means the delivery partner freeing up bandwidth to allow for a strategic refocusing of client efforts on matters where they can add most value.
The third element of the delivery partner team structure is the supply chain. Having a delivery partner lead on procurement – to leverage international best practice, maximise competition, drive value for money and ensure transparency – means that the local supply chain will have confidence to bid within a fair and rewarding process.
We know this works. When we were called in to ensure the Lima 2019 Pan American Games venues got delivered on time, we knew we only had one shot at getting procurement right. Drawing on years of experience using NEC contracts, we worked with local people to tailor an approach and present something compelling to the market. We saw an average of 15 compliant bidders per contract, compared to just 1.6 in normal Peruvian public sector tenders.
While the above outlines some of the key aspects that differentiate the delivery partner model and contribute to its success, there are numerous other factors that make it unique and it’s important to understand these in order to implement it effectively. Mace’s COO for Consultancy, Davendra Dabasia, recently outlined in detail what the delivery partner model is in an article that called for clarity of definition across our industry.
After years of confusion, misinterpretation and modest uptake, we’re now seeing a change. With Mace leading the charge, there is a clarity of definition and a shared understanding that, while the approach isn’t one-size fits all, the central tenets of adaptability, collaboration, trust and transparency are always true. These are all immensely valuable in rapidly-growing nations, where limited experience, an overwhelming workload and risk of corruption present ongoing challenges.
A foundation for legacy
And so, in the context of sustainable global urban growth, the legacy of the delivery partner model must be a consistency of approach, grounded in internationally-recognised best practice principles.
Yet, while the delivery partner model can serve as a legacy outcome itself, it’s also an enabler for other long-term benefits. The key to ensuring this happens, irrespective of geography or market maturity, is early involvement. A delivery partner must be brought on board before delivery. The opportunity to learn about regional needs and capabilities, and influence strategy during planning phases is too great to ignore. Early engagement sets the tone, establishing an aligned culture geared towards a ‘best for project’ mentality, enabling genuine integration as a result.
Integration and a shared sense of purpose can be further emphasised through collaborative contracting and incentivised outcomes. This promotes a sharing of risk but also reward across the entire supply chain, helping to overcome traditional challenges of conflict and associated delay. In developing nations, if suppliers can feel confident they’re not on the ‘bottom rung’ and instead a core part of the team, set to be rewarded for exceeding expectations, we will see greater competition for work and more firms putting their best foot forward. Equally, the delivery partner will manage underperformance in a balanced way, avoiding pointed blame and potential ruin of smaller suppliers.
This integration of the supply chain lays the groundwork for a long-term programme of upskilling that must follow. This is crucial if the delivery partner model is to claim any sort of success in boosting the global construction industry. The opportunity is not one of domination, rather collaboration. We’ve seen the benefits of a mutual approach that gets the best out of all parties in Peru. Building on the success of the Lima 2019 Games, we’ve developed a robust and trusted supply chain that has seized the opportunities to learn from UK best practice and openly shared how ideas can be tailored to optimise results in Peru. The effects of this have been clear on the country’s ‘reconstruction with changes’ programme where, across two years and along with our partners, we have procured over US$3billion of infrastructure projects via open, fair and transparent competition, improving participation, quality of work and value for money.
Knowledge transfer is a hallmark of the delivery partner approach and is vital to delivering the £400billion of annual savings we think can be achieved within the global mega-programme market. Big global spend means big opportunities to save, but we need to learn the lessons and drive efficiencies.
Failure within the industry to collaborate and push for widescale uptake of the delivery partner model around the world puts at risk the timely construction of much needed infrastructure and homes in developing nations. And – as shown in our report – with an opportunity to export capability and capitalise on the expected $US4.5trillion of construction sector growth, it’s a win-win.
