Developing the
Commercial
Strategy in
Partnership
with Suppliers
Phil Bennett &
Rebecca Shepherd
Supplier Engagement
Working Group
DR Supplier Workshop Objectives
Pipeline Overview/ Transparency
Describe process for provision of pipeline to supply chain
Confirm Budget structure and certainty
Tender formation – to identify
Scope
Contract Model
Key Principles
ITT Process
Experience and Lessons Learned
Embed Continuous improvement
DR Supplier Workshop – Key Messages
DR adopting a new approach to supplier
collaboration
Open to innovative ideas such as JVs, partnering,
consortiums etc
Entrench new behaviours – Alliance charters
Contract will facilitate this
Moving away from penalties to incentives
Establishing methods to influence a change in behaviours
and outcomes
Reduce commercial protectionism
Behaviours and culture are paramount
Price will not be the highest weighted evaluation criteria
Innovation is key to the future of the railway
DR Supplier Workshop – Lessons Learned
Supplier’s need certainty of tendering
Sufficient tendering time is paramount to high quality
proposals
Clarity on scope and contract is critical
Innovation must be facilitated
To work effectively, innovation must flow through the
entire supply chain; Innovation occurs at all levels of the
supply chain – not just tier 1s
All parties must manage risks within their control
The current NR contracts need to be amended to
facilitate the level of collaboration required/ alternatives
such as NEC3 considered
DR Supplier Workshop - Conclusion
Demonstrative of DRs commitment to including the
supply chain
Beneficial process to ensure that suppliers are kept
informed
Allows supply chain to provide constructive first hand
feedback into DR regarding tender processes
Open forum with no inhibited conversations
Allows the supply chain to raise concerns/ needs directly
into DR
DR Supplier Workshop - Coverage
•
•
•
•
•
•
•
Lessons Learnt (positive and negative) from past tenders
Pipeline transparency
Budgeting constraints and structure
Tender Formation
Incentivisation
Innovation
Contract Structure and the KPI/Balance Score Card
approach
• Contractual Terms and Conditions
• Collaboration, Culture and Behaviours
Contract Structure, KPIs and the Balanced Scorecard
Commercial
Evaluation 15%
Safety
Evaluation 15%
Technical Evaluation 70%
Value for Money
Fit for Purpose
Sustainable Development
Cost
15%
Pricing Regime –
3%
Cost of Personnel /
Overheads – 5%
Safety
15%
Programme /
Project
Management
15%
Collaborative
Behaviours
and Resource
25%
Equality and
Inclusion
5%
Quality
Assurance
15%
Environmental
And
Sustainability
5%
Example Only
Safety by Design –
2.1%
Use of Plant in
Construction- 2.1%
Process and
Systems – 2.1%
Safety Supervision
– 2.1%
Early Involvement
in Development of
Planning – 3.75%
Best Person
for the Job – 3.75%
Right Design at
the Right Time –
5%
Long Term
Planning
Competencies
3.75%
Client / Stakeholder
Collaboration –
2.5%
People
Competencies –
5%
Legacy
5%
Environmental 2.5%
Cost In Use /
Whole Life
Reliability – 1.6%
Sustainability 2.5%
Post Delivery
Support / Aftercare
1.6%
BEHAVIOURS AND CULTURE
Efficiencies against
Unit Cost and
Target Cost – 5%
People and
Behaviours Culture
- 2.1%
Access
Optimisation and
Utilisation – 3.75%
Supply Chain
Relationship
Management –
6.25%
Equality and
Inclusion
Innovation,
Continuous
Improvement,
Construction and
On Site Production
Quality
5%
ASSURANCE
Programme and
Project Cost
Management – 2%
People
Competencies –
2.1%
Safety Assurance
(Sites – 2.1%
Quality Planning –
to avoid late
changes – 3.75%
Assessment of Key
Supply Chain
Partners – 12.5%
Equality and
Inclusion
Hand Over and
Hand Back – 1.6%
8
Phase 2 Demonstration
Norwich – Yarmouth – Lowestoft (NYL)
NYL – Delivery Strategy
SYSTEMS INTEGRATION
DR
PROGRAMME MANAGEMENT
BUSINESS CHANGE
ETCS
COMPASS
Track & LX works
GSM-R & FTNx
Collaboration & incentivisation
Traffic Management (Incl. C – DAS)
IP
NRT
Data
GBS
FiC & Freight Train Fitment
DR
OTM Fitment
NSC
Passenger Train Fitment
ToC
Existing Activity (LINX, EULYNX, DRACAS, safety case etc.
DR
Future Delivery Strategy Development
Next steps
New round of stakeholder sessions with stakeholders
and suppliers over spring 2016
Draft OBC strategy developed by late spring 2016
New round of supplier engagement groups in summer
2016 to review
Learning from NYL procurement incorporated into final
strategy proposals
Final OBC commercial strategy published autumn 2016