AIM Success Guide
Success Guide Successfully Managing Capital Projects Written by Bill Ferris OBE DL, with thanks to Artelia Based on the experience of the AIM Biffa Award National Heritage Landmark Partnership Scheme Projects Success Guide Successfully Managing Capital Projects
Written by Bill Ferris OBE DL, with thanks to Artelia Based on the experience of the AIM Biffa Award National Heritage Landmark Partnership Scheme Projects
Front cover image: Repointing at Newman Brothers Coffin Works, Birmingham 3 AIM Biffa Award National Heritage Landmark Partnership Scheme Awarded 2012 - 2015 This guide has been written to share learning from the AIM Biffa Award National Heritage Landmark Partnership Scheme. This scheme provided £1.5million to rescue, restore or bring into use, nationally significant industrial heritage.
Capital projects that involve money donated by Biffa Group Ltd heritage sites and buildings, through the Landfill Communities frequently face unexpected Fund. challenges and more uncertainty than normal projects. Managing The Royal Society of Wildlife these, alongside all the ‘normal’ Trusts has more than 20 years of challenges of a capital project is a experience in managing social and significant undertaking. environmental grant programmes totalling over £250 million and The organisations supported by proven successes working with AIM Biffa Award learnt a great and empowering people to make deal about project management in significant environmental and the course of their work and this societal impacts across the UK. guide shares some of that learning. In 1997 Biffa Group Ltd decided to donate landfill tax credits to RSWT About Biffa Award to administer under the fund name Biffa Award. To date, Biffa Award Since 1997, Biffa Award has has awarded grants totalling more awarded grants totalling more than than £156 million to thousands of £156 million to thousands of worthwhile projects across the worthwhile community and country. environmental projects across the UK. The programme administers
Picture courtesy of Newman Brothers Coffin Works Site Team meeting, AIM Biffa Award funded project at the Coffin Works AIM Biffa Award National Heritage Landmark Partnership Scheme In 2011, AIM entered into a 3-year funding partnership with Biffa Award which provided a £1.5m investment into independent museums and industrial heritage sites across the UK. The Scheme focused on landmark industrial heritage sites, relating to key industries including mining, textile manufacture, shipbuilding, metal processing, chemical industries, defence, farming and technologies such as power generation and communication. The heritage projects that the funding supported were:
Newman Brothers Coffin Brooklands Museum Works Stratospheric Chamber Coffin Works Learning and Restoration & Interpretation Interpretation Project £120,000 £44,676
Ironbridge Gorge National Mining Museum Museums of Scotland Bedlam Furnaces - Icon of The National Mining Industry Memorial £30,099 £120,000
The Historic Dockyard Underfall Yard Chatham Revealing the story of Chatham Dockyard World Hydraulic Power Heritage Discovery Centre £120,000 £ 117,500
London Museum of Brunel Museum Water and Steam Opening up Brunel's Shaft Project Aquarius – £120,000 Babcock Room £80,364 Cromford Mills Bursledon Brickworks Arkwright: Father of the The Museum of Bricks & Factory System Brickmaking £112,500 Reinstating the Second Steam Engine £82,000
ss Great Britain The Postal Museum The Restoration of the Mail Rail: The Birth of the Grade II* listed 'Brunel's' Underground Postal Drawing Office Railway £117,180 £69,075
National Waterways Woodhorn Museum Museum Ellesmere Port Colliery Winding House From Port to Powerhouse New Visitor Access & A Window on the World Interpretation £119,718 £35,000
Middleport Pottery Bringing the William Boulton Steam Engine at Middleport Pottery Back to Life £120,000 AIM Success Guide 6
Successfully Managing Capital Projects
Contents
1. Introduction 2. Getting Ready for Your Project 3. Planning Your Project 4. Appointing the External Project Team 5. Delivering Your Project
Appendix – Service Briefs, Procurement, Due Diligence and Contracts
1. Introduction is as important as every other part of the work of the organisation. The Guide can only ever be So, you’ve raised the money, you an overview and an outline Capital projects are exhilarating, for Trustees and know what you want to do; now you’ve just got to do it! exhausting, exciting, demanding management boards. You and all consuming! For most might want to read this organisations the project is a before embarking on a Obvious, but potentially daunting and a critical moment in means to an end not an end in capital projects, in order to itself. be prepared for the breadth determining the successful of considerations and again outcome of a project. In reality this delivery part of the process should Alongside delivering the capital when you know your project project you will be researching and is going to go ahead. have been well thought through long before the funding is in place. preparing your collections for new exhibitions, fundraising, developing Delivering successful projects is a new marketing materials, planning serious business and one that, new ways of delivering your unsurprisingly, most museum and operations etc. so that when the heritage organisations are not contractors move out, the “home really set up to deal with, despite team” is ready to make a success the probably relevant and wide of the finished project. ranging knowledge held within trustees, staff or volunteers. Doing all of this, and possibly keeping your museum open Why would they be? Such throughout, is extremely organisations deliver museum demanding - make sure you will services as “the day job” and have the people and budgets you capital projects are one off events, need to make a success of your so planning how the organisation completed project. will resource and deliver a project 7 AIM Success Guide
2. Getting Ready for Your know why the dog is barking and Project how to respond as its leader!
Being a Good Client Fundamental attributes of a ‘a good client’: You are the client for your capital project and it is your project, not ▪ Leadership and vision the funder’s, the project manager’s, architect’s or any other of the ▪ Clarity of project purposes and consistency of your success cri- designers’ or consultants’ who you TIP employ. teria ▪ Clear lines of responsibility and Planning and resourcing You employ professionals to help authority for post capital project provide services beyond your operations should be a experience or capacity and you ▪ Engagement and Availability primary focus for delegate such services to them organisations and is often but…you must understand the ▪ Approachable and able to ac- under resourced as boundary between delegation and cept advice for consideration projects take over abrogation of responsibility. ▪ Decisiveness and clear decision As client you should build an making protocols excellent relationship with all the project consultants, contractors ▪ Good systems especially for rap- and your own directly involved id decision making team members. It should be honest, transparent, creative, ▪ Commitment to excellent com- communicative and quick - munications recognising that your organisation is the lead. ▪ Enthusiasm to build a sense of team and common goal The old adage of “not buying a dog and barking yourself” is true ▪ Plans for what will happen after but most successful dog owners the project is finished will tell you that the dog knows who the boss is and will do anything for them. So no need to bark but plenty of need to
Picture courtesy of Chatham Historic Dockyard Trust AIM Success Guide 8
The Journey back to them to ensure you are delivering what you set out to You’re now about to set off on a deliver. linear journey and the first three steps of that journey are critical to ▪ Have a map - Plan your journey success, in that you: and think about what could get in the way of reaching your des- ▪ Know where you want to go – tination Your Vision
▪ Why you are going to your new The rest will fall in to place… destination -- Determine your success criteria so you and the project team can keep referring
PROCURE PROCURE Procure the ProcureTHE the OPERATE Success Operate & Vision SUCCESS Plan ProfessionalTHE Design Works and HandoverHAND Evaluate VISION Criteria PLAN DESIGN WORKS Maintain& EVALUATE CRITERIA PROTeam BuildAND it OVER MAINTAIN TEAM BUILD IT
Remember that your vision must Usually an organisation will appoint be about what you want to achieve, a key person to lead the project. which will only be possible through They might be called the Project the capital project you are going to Director or Internal/Client Project undertake. The vision should not Manager, to distinguish them from be to have a building for a a consultant project manager. building’s sake, but about the difference that space will make to They may be someone who was how effectively you can deliver already employed by the your purpose. organisation and who may not have led a major project before Client Project Team Structure (possibly continuing their normal role alongside the project manager Early on in the project you need to role, though how demanding this set up a client project team (the can be should not be under- “home team” of staff, trustees and estimated). volunteer’s directly engaged in the projects planning and delivery) so Sometimes a new member of staff that the roles and responsibilities of is recruited. those within your organisation who are working on your project are During the project there will be lots clear. of key decisions to be made - whether they are about signing off A degree of formality to this is the brief, design, appointment of necessary for a large capital consultants and contractors, project, as there are potentially spending money or making both emotive and high-risk changes. decisions to be made as the project develops. 9 AIM Success Guide
It is important to be clear on how much decision-making is delegated and what needs to be decided by Case Study the trustees or other senior members of the organisation. Staying Open During The building in which it is located In all cases it is necessary to have Building Works is arguably the most important on a process that ensures decision- the site - and the one that making is informed, speedy and Cromford Mills, The everybody wants to go in - so decisive! restricting entry whilst the work Arkwright Experience, was done meant that we The risks and impacts on funded by AIM Biffa Award potentially had disappointed organisational operations dictate customers. that it is vital that the board of Communication is always key trustees is engaged and informed when dealing with a capital works We managed the situation by about key aspects of project programme - especially when your making sure that visitors were delivery however big or small the site remains open to visitors. informed about the work as soon organisation. as they arrived on site: they At Cromford, we found that the understood what we were doing In smaller, volunteer organisations best way to deal with the and why and that they were invited it will often be the board or a disruption was to embrace it and to to come back as soon as the new subset of it that delivers the project tell the world what was happening, experience opened so that they with appropriate professional and rather than just putting up big could be some of the first to see it even volunteer support. In larger unfriendly NO ENTRY signs in action. Generally, people are as organisations the staff will often be everywhere. interested in the new delegated responsibility to deliver developments as they are the projects but this should only be It took us around 8 months in all to history – but they need to be kept within clearly defined parameters introduce a viewing platform and informed and allowed to feel part and with explicit and defined CGI equipment to create ‘The of the changes. reporting and authority limits. Arkwright Experience’ and we Larger organisations might were hampered by difficult consider a sub group of trustees environmental conditions. with specialist knowledge to have oversight of project delivery, considering greater detail than can be achieved by the board.
Such a group has delegated authority to a clearly defined extent and reports to the main board to an Trustee Board agreed programme and extent.
Trustee Project A project governance structure Sub Group might look like this: * Client Project Organisational Senior Director Role Management Role
Organisational Project Team Client and Project Client Project Management Professional Team & Teams Team Works Contractors Functions
* This person will usually have permanent responsibilities within the organisation but if the project is very large it might be a specific appointment AIM Success Guide 10
The Project Brief There is no definitive list to work to because every organisation will As a good client with a clear vision, have different priorities and you will have written a project brief different funding strategies. before engaging consultants or placing contracts. This is the The list demonstrates how document that sets out exactly important it is to consider the actual what it is you are trying to achieve operation of the finished project as with your project and what are the much as the project delivery absolute essentials of the finished process itself. project. The brief is critical, as the project You will need to think about what is develops, in helping you manage really important to your inevitable change. If a change is organisation. Such things might suggested or emerges always include: check the consequence against the brief to be sure that there are no ▪ Brilliant contemporary design “unforeseen” impacts of the using specific design references change. like local materials or design features All organisations should have the project brief signed off by the board ▪ Sympathetic design to of trustees and chair, to avoid emphasise an historic building’s change later. In smaller quality and listed status organisations the trustees and chair might actually define the brief. ▪ Low carbon impact in development or operation Soliciting the comments of staff and volunteers through structured ▪ Funds available and budget consultation is always a good idea limits to be applied to the capital because their “operational” eye is and activity elements of the likely to spot things you have project, remembering to missed. consider “client” needs* Many museums that have ▪ Future operational efficiency and undertaken capital project will be visitor comfort willing to share their brief with you ▪ Accessibility issues if you ask. It’s always a good idea to ask what they would do ▪ Collections care and differently if they were writing a environmental controls brief again.
▪ Security
▪ Interpretational styles and approaches to work with the architecture and collections
▪ Minimisation of future operating costs (staff, utilities, maintenance etc)
▪ Visitor and staff operational needs (eg staff/volunteer rooms and lockers are surprisingly often overlooked) 11 AIM Success Guide
Budget for ‘Client’ Needs ▪ Artist’s impressions or architectural models – very Your organisation will need a useful for fundraising and budget for delivering the project consultations with stakeholders beyond the costs of design fees and building works. Many of these ▪ Stakeholder consultations and items are not included in budgets events including the launch party drawn up by cost consultants (or and donor recognition quantity surveyors), for instance: ▪ An internal client contingency ▪ Costs of fundraising and internal usually not shared with the project management design team, for the organisation’s own requirements ▪ Legal fees and property issues to successfully deliver the project and plan for operations Early investigations, reports or after completion surveys (e.g. trail pits, asbestos surveys, highways reports)
▪ Irrecoverable VAT (and professional advice relating to this)
▪ Furniture and fittings, signage
Image courtesy of The Historic Dockyard Chatham AIM Success Guide 12
3. Planning Your Project Risks can also be costed to inform decisions about contingency (see Project Programme is simply You know your business better below). the title given to the time taken than anyone, with your in-house to complete individual elements team start to build your project The risk register is a “live” of your project and how each of delivery plan. A good place to start document and it is very important those elements relate to the is thinking about the obstacles you to review it with the team regularly others combining them to may or may not have to negotiate and especially before embarking provide the fastest, most to stay on track. on specific phases of the project’s efficient, least risky route to delivery, making sure that new meeting all of the outcomes of Programme - A simple timeline for team members and disciplines are your brief your project helps your team fully engaged in the process from visualise how the project will be the start. Gantt Charts - the bar charts delivered and how it may impact on that plot the time taken to their day to day business. More Contingency - All projects should complete the elements of your detailed programmes will be have sufficient contingency project ordered and linked to developed as you move through incorporated into costings and time maximise efficiency and the life of the project, usually by contingency (or ‘slack’) into illustrate issues such as order your project manager, and they are programmes, to cover the lead times, elements that rely essential to the success of the consequence of foreseeable risk. on the completion of other project. These are often shown as things before they can start etc. Gantt Charts. Analysing these This can be as simple as a charts identifies where time-related percentage of budget, the scale of Critical Path - the time line that risks exist, interdependency of which depends on the potential joins all of the significant stages and the “critical path”. risks foreseeable, the amount of elements of a project that pre project investigations dictate progress, delay in Risk Management - There are undertaken and the client’s own completing a critical path item many risks associated with propensity to make late changes. delays the whole project. delivering capital programmes. Understanding these and rating There can be no prescriptive Risk management - the their likelihood, and significance if percentage but, because it process of identifying what crystallised, is essential. increases the fundraising targets, things are likely to negatively most clients underestimate impact on the delivery of your The process is often seen as a contingency. project with time and cost “necessary evil”: it is far from an implications, how likely these evil but it is totally necessary! Too big a contingency can imply a events are to happen and what If appointed, a project manager will lack of planning too. On large you can do to prevent or normally lead this process through projects it can be useful to break mitigate the risks. a workshop that involves the client project contingency down in more and professional team, so defined ways such as: Contingency - a cash or time everyone understands what the reserve that is set aside risks are and which are most ▪ Client contingency to facilitate specifically to cover changes, significant. Risks range from design enhancement and project unexpected events or design financial and programme related, development in the early development as a project to legal, damage to historic fabric, phases. develops. archaeology or collections, organisational and many more. ▪ Ground works contingency An experienced project team will where new build works are quickly identify universal risks but involved. Ground works can be you are best placed to consider the most risky elements. specific risks. Once identified, ▪ Activity based contingency mitigation (measures that limit or which is probably more reduce the impact or likelihood of a controllable. risk materialising and adversely affecting project outcomes) and ▪ General project contingency. monitoring strategies can be quickly identified. 13 AIM Success Guide
▪ Post opening contingency to fix ▪ funding patterns and absolute things that don’t work as cashflow imperatives expected when you start using the completed building or ▪ internal resources for content exhibition. development and design review (your own curators, historians, One important way of managing designers) risk is having a strong change management process to deal with ▪ conservation times for key changes during the design and content construction stages of the project. ▪ internal time needed to provide detailed information about They might be changes that have collections and history to to be made, or that people within exhibition designers the client team wish to make. See the Project Delivery section for ▪ local knowledge about planning more information. and other consents
The Project Programme ▪ consultation requirements
The Project Manager (PM) has Major programme risk areas overall responsibility for agreeing include: and managing the project programme (time line). It is a ▪ Unforeseen ground work delays fundamental tool of successful – archaeology, obstructions, project management. The client services has an absolute responsibility to review this regularly and ▪ Uncontrolled change understand the implications of making changes to it. ▪ Unrecognised procurement lead times – especially for software Understanding how the different development and hardware parts of the programme relate to procurement each other, what elements are contingent on delivery of other ▪ Lack of ongoing project related parts and therefore what the fundraising success taking place “critical path” is represents during delivery. A grant for new essential client knowledge. This display cabinets gets turned should ensure that unintended down, the fundraising lunch client led delays are avoided. doesn’t reach its target
The programme must be realistic, ▪ Loss of key personnel at critical include lead times for procurement points and reflect the decision making process and time implications that ▪ Financial failure of a contractor are contingent on it. If things take or consultant longer or are delayed, they almost ▪ Poor programme management always cost more, especially after not recognising likely future building works have started. delays or errors Client input into the development of the programme is vital. Key milestones you might want to ensure are included are:
▪ essential opening dates (perhaps an anniversary) AIM Success Guide 14
4. Appointing the External ▪ Business Planner Project Team The briefs you prepare for these team members (see appendix for There are more detail about more information) and the successful procurement in the decisions you make in appointing Appendix, covering: them, will have significant impacts on how well the process of project ▪ Development of Service Briefs delivery actually happens, what ▪ Procurement and Procurement outcomes you get and how much Rules strain the process puts on the client organisation or conversely ▪ Legal Contracts how much enjoyment and satisfaction is derived from it. ▪ Due Diligence Happy teams make happy projects, ▪ Guarantees that are generally successful.
▪ Types of Building Contract Capital projects are demanding and resource heavy with many Appointing the Design Team technical components. If you have (also called Professional Team an organisation to run or to get or Consultants) ready to operate a new facility post-project completion, it is most One of the client’s key jobs is to unlikely that the client team will appoint the design team and, have capacity to deliver a TIP usually later in the process, the significant capital project without contractor(s) who will do the support. Resist making a public building/fitout works. statement about when you Even if it thinks it will have the will open your project for The professional services team are professional skills and knowledge! as long as possible, as usually appointed first and might Sometimes clients may resent the capital projects are include some or all of the following: seemingly high cost of professional delayed more often than fees, but you generally get what not, sometimes by many ▪ Project Manager (PM) you pay for and value comes from months. how you use the investment in ▪ Quantity Surveyor (QS) – them by managing them well. sometimes called Cost Consultant Build the realistic costs into your fundraising strategy and build the ▪ Architect management time into your ▪ Exhibition Designer (best resource schedules, to ensure you appointed at the same time as get the best from the team. the rest of the design team)
▪ Structural Engineer
▪ Mechanical and Electrical Engineer (M&E) (with potential additions of acoustic and lighting)
▪ Access Consultant
▪ Activity Planner (for HLF funded projects where an Activity Plan is required) 15 AIM Success Guide
There is more information about A very personable “business contracts for professional team development manager” will never members and procurement be the one who leads your design processes and rules in the process – be warned! appendix. Be very careful about the Choosing the Right Team substance that lies behind tender pitches! Find out how much work Cost is only one factor. Lowest these specific team members have cost is not always best value, be committed to other projects over sure to weight this factor the duration of your project. Busy appropriately. people and teams tend to be attractive but can be over- You will work with this team for a stretched! considerable time and it’s important, therefore, that its It is essential to undertake constituent members “fit” the appropriate due diligence. Not organisation that they work for and only things like financial stability, that you are comfortable with their but make sure that the current operating ethos and approach. workforce has actually worked on Your consultant team should show your type of project, take the a commitment to your vision and to trouble to visit projects that they listening to you and understanding have worked on and find out how your needs, so that the final project the relationship worked or at least is not just an architectural marvel, speak to others that have used the but will be fit for purpose when you services, not always the ones come to use it. suggested by the consultant!
That doesn’t mean that they just do (See the appendix for more on due what you tell them - what’s the diligence.) point of employing creative professionals if all they do is Be sure about the actual scope of implement your thinking? works that it is being offered within the contract. As an example, The balance is right when the team client’s often believe that lighting or “buys into” the ethos of the client acoustic services are provided in organisation and then adds M&E contracts because the professional value to it. “company” has those services within its organisation and might The client needs to show real even have mentioned them. If they leadership, recognising the are not specified as included in the separation of that and detailed services they will be an additional management, which is for the team cost! to do. The client must be prepared to be challenged and accept Often a group of consultants will different thinking, but this is always pitch together as a team. This can best done if there is excellent two- be very positive if they have really way respect and understanding. worked together, that there is a good dynamic with complementary Be very firm in insisting that no skills but if it is a team stitched appointment is made without together for a specific purpose – to meeting those that will actually look good to win your project – work on your project and how the take care. effort divides between team members. AIM Success Guide 16
More focus on team testing and individual members do not share a compatibility is required. Try to common ethos to such projects. identify whether such groupings are true marriages with chemistry Professionals are used to working and additionality, or “marriages of in new teams on a day to day basis convenience” to meet the brief, but the client and Project with no track record of working Managers (PM) approach and style together. of managing the team has a big part to play on the efficiency and The latter can work but it is buy-in of the team. obviously more risky, if the
TIP ▪ Do you know who will really work on your project? If not Tips on appointing the design find out! team: ▪ Cost is only one factor. ▪ Investment by tenderers in Lowest cost is not always pitches isn’t always backed best value - be sure to up by similar investment or weight this factor commitment to your project appropriately – do your due diligence! ▪ The track record of the Lead ▪ Is there real chemistry within Consultant within a team the pitch team dynamic? that is pitching together, is vital information
Picture courtesy of Cromford Mills 17 AIM Success Guide
Appointing the Contractor A Contract Administrator is only usually required on large and Later on in the project development complex projects. process you will appoint a TIP Contractor. The same approach to It is a costly service that is there to selection that you used with the safeguard the client from future Tips on Tendering for the design team, applies to the contractual disputes and costs. Main Contractor: contractors and service providers There are no hard and fast rules who will physically deliver your about the need but good PMs and ▪ Remove as many of the project, but by this stage you have QSs will advise. The services are risks associated with a professional team to assist. not usually recommended on small capital project delivery by projects. doing as much "de- Good selection decisions rely on risking" through surveys identifying the critical elements of The Architect or the PM are often and careful development work packages and getting the nominated as the Contract of your plan, before best team to deliver that. Administrator (CA) or in NEC defining the scope of Contracts PM. works. A few Construction teams often come as archaeological trial pits or teams of unrelated specialist areas This is an important role in an asbestos survey, at such as: managing the delivery of all the client's cost, before contracts. It is worth seeking contracts are specified specialist advice on where this might save huge delays ▪ Principal contractor (the responsibility best sits based on and costs later. builder) your specific project and your experience. ▪ Time spent defining the ▪ Subcontractors including: scope of specification of The CA/PM, although employed by services and works in ▪ Carpentry the client/employer, have a neutral advance of contracts role to play between the being let is rarely wasted ▪ Roofing client/employer and the contracted and will save delay and cost later ▪ Electrical and mechanical supplier, so don’t expect your Plumbing, heating, lights Contact Administrator to take your side if things become contractual. ▪ Design and Build and power construction contracts are often cost effective, as ▪ Painting and decorating are Construction Management approaches ▪ Specialist equipment but both come with risks suppliers and resource ▪ Etc. implications. Don't be seduced by "low" cost, if See the appendix for more quality or other measures information on appointing a are key success factors. contractor including types of building contract, guarantees ▪ Be prepared to delay and due diligence. going out to tender if the information is not Contract Administrator? sufficiently developed as it will potentially give The technical administration of the greater cost and building contract(s) is not to be programme certainty. taken lightly as get it wrong and you could inadvertently find yourself in a legal challenge or accepting costs that you didn’t approve. AIM Success Guide 18
5. Delivering the Project team will be with you through both stages, and in addition, during the Example of topics to cover in a Building and Leading a Great construction stage you will be Pre-Start Workshop Team working with the Contractor (and Contract Administrator, if Ethos of the project So, you’ve appointed the appointed). You should also be professional project team or design aware that during the Construction Things that might be covered by team and the work really begins. Stage you will also be needing to the client include: gear up your own organisation in All successful projects start with a preparation for the opening and ▪ Introductions to your team and well facilitated pre-start workshop. this may include time consuming their roles within the project The PM will usually organise this activities such as recruitment, and provide the agenda. Whilst training and much more. ▪ Purpose of the organisation much of this will be technical and and the significance of this beginning to look at detail, there Your need to fundraise will project to that purpose. This is are things that the client must show probably continue throughout. a big opportunity to inspire the leadership on, so it is a good idea In both the design and construction team and build real empathy to ensure an early session on the stages, the usual approach to and interest that leads to the agenda to establish this. If the project management is a series of team going the extra mile project team doesn’t understand scheduled meetings with different the ethos of the organisation and purposes and outcomes. ▪ How you like to work with how that relates to the capital teams; embedded “one team” project and therefore “what Make it clear, as client, that you approach or distant, separate success looks like” how can they expect to be kept informed of all but professional, deliver what you expect? significant matters in a timely way, ▪ Critical Success Factors for meaning that waiting for formal the project, e.g. You need to define this closely and meetings, where there is a make sure that the whole team significant potential of delay or cost ▪ Quality understand it and adhere to it. increase as a result of emerging issues, is unacceptable. ▪ Listed building/other statutory This will hopefully set the tone of constraints and the relationship, inspire the new The principles of transparency, team, help make it gel as a body availability and great ▪ Budget and where the priority and leave no doubt about whose communications are central to spend must be focussed if project it is and what is expected. success. changes are required. It is In setting this out you must often a good idea to ring-fence remember your role in achieving interpretation and fit-out success. Slow decision making, budgets to stop them being uncertainty about budgets, plundered to pay for constant change etc will all impact “emergent works”, on critical outcomes. Don’t set a architectural design standard you can’t meet yourself. development or services requirements. Managing the Various “Delivery Phases” of a Project ▪ Time/programme- are there critical longstop dates? Once all the teams are in place, the roles and responsibilities are ▪ Design freeze imperative established and the communications protocols are ▪ Optimising running costs agreed all that’s left to do is implement the works! ▪ Funder requirements The design stage and construction ▪ Client Communications stage of the project are quite requirements and protocol – distinct and need different input informal / formal reporting from the client team. The design 19 AIM Success Guide
Meeting Schedules there are always more risks, greater uncertainty, greater need The PM will be keen to agree a for information and change. number of meeting schedules. It’s important that a client understands It is essential that clients recognise what each meeting entails and how this, allow diary time and have involved they need to be and at decision-making processes in what level. Standard meetings place. include: At certain points in the design ▪ Design Team Meetings. These process the client will be asked to start during the design stage and formally sign off the design to that continue in the construction point. Before each sign off a cost stage. They are regular estimate should be prepared based meetings where the necessary on the designs. If this is over elements of the design team get budget the client can expect the together to develop designs, project manager to work with the resolve issues and coordinate design team to bring the costs work. It is always worth within budget again. appropriate client representation at these at a senior level, This is often done through a Value capable of making decisions and Engineering workshop, where the providing sound information, as design team (and contractor if well as to control “project appointed) get together to look at expansion” etc! how costs can be reduced, with minimum impact on the required ▪ Client progress meetings. It is outcomes. Most projects require useful for the client to meet with this at some point during the the PM, QS and lead designers design stage. between formal meeting to help prepare for them and resolve any issues or conflicts in a less formal environment.
▪ Trustee reporting – main board or sub-committee Picture courtesy of National ▪ Funder monitoring meetings, Waterways Museum Ellesmere Port especially HLF
▪ Progress meetings (construction phase). These are formal and usually monthly and relate to the contractor reporting progress against programme. They are also used to confirm changes and deal with formal Requests For Information (RFI’s). They are minuted and contractual, requiring careful preparation and detailed analysis of reports. Words matter at such meetings.
The regularity of meetings will vary as the project progresses based on the needs. It is best to meet more often early in the project when AIM Success Guide 20
Client Team Meetings ▪ Additional design costs as a How the client team interacts as a consequence (these have to be unit will depend on the scale of the met by the client) organisation and the management ethos. ▪ Programme delays which always have a cost impact or What matters most is that it is a programme impact whether in cohesive and communicative team. terms of fees, contract prolongation and potential Where there is executive and delays to opening dates and trustee separation it is essential revenue streams that trustees are fully engaged and informed. Capital projects often ▪ Missed procurement deadlines dwarf the scale of annual operations so trustees have a ▪ Increased build or fit-out costs responsibility to be fully engaged, etc. but not necessarily managing. Budgets are always limited, Any This is especially important should change that results in more costs a crisis occur that requires rapid will need to be funded from: decision making if costs and time are not to be lost. This will require ▪ Contingency, the use of which flexibility and accessibility outside early in a project is very risky usual meeting protocols. and should only be contemplated subject to review As discussed earlier (see Client of future risks and funder Project Team Structure), within the obligations client team it is essential that delegated powers, authority levels ▪ Additional fundraising and responsibilities are clearly defined and monitored. ▪ Savings made from elsewhere, which can have significant Change and Change impact on whether the project Management achieves what you need and intend As projects develop there will always be changes. Change is The process of managing often a very good thing -improving change is therefore one of the project outcomes and outputs. But most important elements in these changes need to be creating successful projects. If managed or they can become very you employ a project manager costly. The implications of the they will assist with this. change on the budget, other areas of the project delivery and on the There needs to be a clearly defined overall outcome of the project, process and very clear authority need to be considered before any protocols, both within the client change is agreed. organisation and with the design The reason for a change may be a team and contractor. discretionary issue - you chose to make a change, or it may be an Dithering about proposed change enforced change, created by can be very costly. The onus is on unexpected factors such as the the client and professional team to discovery of asbestos, archaeology manage the change process or even legislative developments. efficiently and quickly, which relies on good, accurate information and Change rarely comes without a client availability. cost, which might arise from a variety of sources including: 21 AIM Success Guide
As the client you are best placed to fully consider the impact of proposed changes on the overall Tips for successfully managing change within your outcomes of the project. In order project: to ensure you can respond promptly to requests for change, ▪ Having a formal process for change management particularly during the construction agreed with all members of the team. As a minimum stage, ensure someone else from this must: your organisation can made decisions, if the person who ▪ Identify where the final responsibility lies for normally authorises changes is agreeing change. Best practice is that this is the not available. client (you) on every occasion, however large or small, meaning personnel availability is critical. Some clients delegate powers to sign off changes up to a certain ▪ Insist that any request for change is supported by financial limit to their consultant a rationale and indicative (net) costs and likely Project Manager. If you do this, it programme consequences is essential to define exactly what those powers are. These might ▪ Proposals for potential savings to compensate include maximum cost of change potential programme or cost impacts arising from limits or specific areas where the proposed change, which should mean that delegated change is acceptable the team works collectively and collaboratively to and where it is not. manage change recognising programme and Even if there is some delegation to budget constraints the PM, the client might want control over all change related to ▪ Provide a regular design and client team meeting materials used, space planning schedule to agree and discuss proposed changes where there might be unforeseen ▪ Provide a process to deal with urgent change operational implications, requests that fall outside the normal meeting collections or interpretation programme matters. For instance, a seemingly simple move of a door ▪ Agreeing a “design fix/freeze” (a point in time when no location at construction phase to design changes can occur without going through the facilitate an easier location for a formal change management process) as early as radiator might actually prevent a possible in the project development both for building key operational feature like a and fit-out works. Later changes based on “buildability” display case going where it needs etc are still likely but should be manageable from to in order to fit the narrative. The contingency. client will understand this but perhaps the PM might not! ▪ Making it very clear to contractors (within contracts) that unauthorised change will not be paid for. The best way to manage change is to try to think through all the ▪ Beware the risk of substantial cost implications of a project needs when writing the number of seemingly small changes, that together have project brief. If all those with an a major impact. interest in the project, both during delivery and post delivery, have been involved in designing the brief and are consulted if change is proposed, problems should be averted. To achieve this effective- ly people must be available and engaged. AIM Success Guide 22
Crisis Management are involved and all relevant contracts etc must be readily You’ve done your due diligence, available you’ve chosen a great team, the client team is engaged, the briefs ▪ Trustees and other key were good, the procurement stakeholders must be informed strategy is appropriate, there is and engaged programme and cash contingency ▪ Key imperatives for recovery based on risk analysis - what could must be identified quickly. possibly go wrong? These might include:
The answer is many things. ▪ Time Capital projects introduce huge amounts of uncontrollable factors ▪ Budget into an organisation that is probably used to having all the ▪ Potential compromises on control. Things like a national quality and scope financial crisis might put seemingly sound contractors at risk of ▪ An early assessment of likely financial collapse, the loss of a key costs and programme colleague through ill health at a implications critical moment, the loss of a funding partner and much more, It is essential that clients can put outcomes in jeopardy. understand that they have most to lose in a crisis. The professional All good projects plan to minimise team might lose reputation if they these risks but it is impossible to are implicated and might have mitigate them all. What is possible, legal penalties to face, but if this however, is to have a crisis isn’t the case they will actually management approach in place receive additional fees to manage and thought through that is capable the process and as such the client of dealing with most situations. If pays ultimately. the worst happens, speed of action, open communication lines, No one wants a crisis but some careful planning, professional lose more than others! standards and total commitment will be essential. It requires the engagement of senior people and decision makers.
There are some important steps involved:
▪ The external PM and the client project lead must react immediately
▪ Arrangements for trustee communication must be in place before the crisis happens
▪ If the project is halted the site must be secured to prevent theft or damage
▪ Legal advice must be sought immediately if contractual issues 23 AIM Success Guide
Case Study When it all goes wrong! one week and shaped the plan going forward. We identified Crisis Management at The that delaying opening by more Historic Dockyard Chatham’s than 3 months would result in £9.2m Command of the the key visitor season being Oceans (COTO) Project missed and the impact of £9.2m spend negated. Chatham Historic Dockyard Trust (CHDT) is very So…. speed of action was experienced in delivering capital essential. Minimising the time projects but even despite lost is a good way to save appropriate due diligence, money but it can result in costly employing experienced teams procurement. and applying all the principles of good project management, Finding an acceptable, value things can still go wrong. based procurement approach was critical in limiting delay and Just months into the delivery cost….so creative thinking was phase of the COTO project, the required. Matching all the Main Contractor was placed into original outcomes in terms of Administration, with no quality and services provided warning. It is at these within the constrained budgets moments that a high quality was impossible….so, even after team earns its fees. It is not a consideration of the moment to hesitate but to act. performance bond more The site was secured to prevent fundraising was required. theft or damage. Stakeholders and funders were informed. Having informed funders and stakeholders of the situation Once the basics were done the immediately, we also set a next critical phase was to plan series of meetings up over the the recovery, prioritising against next 3 months to ensure that as the original project brief. Critical our plans progressed we could success factors were identified get sign off rapidly, with our own and agreed by trustees within Board as well as with funders.
Crisis point! Contractor goes into administration leaving Scheduled Ancient Monument suspended in mid-air! AIM Success Guide 24
Case Study continued With a great deal of hard work Bond Covered approximately the team managed to secure £300K of this. approval to proceed with a new contractor within 7 weeks Our funders were patient and and works commenced again understanding. They 12 weeks from the site welcomed our engagement closing. The project opened with them and our in May 2016, just, 12 weeks professional approach to behind the original schedule. recovery and insurance. The consequence being that we The overall cost was some were able to close our funding £700K higher than originally gap very rapidly and complete planned due to a range of the project with all its planned reasons associated with outputs secured. CHDT thank prolongation of professional them profoundly for their contracts, additional work support. necessary to transfer from one contractor to another, The project has delivered a remedial works that were major step change in our required to correct deficient visitor engagement and standards left by others and service strategy meeting all of other matters. The 10% of the desired outputs. contract value Performance
Mutual respect between client and professional team played a huge part in getting the project recovery plan in place so quickly. From left to right Bill Ferris (CEO, CHDT), Steve Prowse (Project Manager, Artelia), Alan Mitchell (Architect, Baines and Mitchell), Brendan Higgins (Architect, Baines and Mitchell), Bob Dollin (QS, Bob Dollin), Nigel Howard (Estate Manager, CHDT). 25 AIM Success Guide
Case Study
Underfall Yard discrete portions have their own lives and issues to contend with Restoration of the Grade II* and are not necessarily living Pump House and and breathing your project the way you are. machinery - AIM/ Biffa Award £120,000 Make sure that consultation carries on throughout our Taking on a project at HLF project – update not only the Round Two (RIBA Stage 4) can new people adding their names be a challenge: everything is in to your growing e-bulletin list place and it’s easy to assume but keep all your stakeholders that the hard work has been in the loop – even if you feel done and it’s just a matter of there is not much to tell! running with it. But projects are always evolving – be ready for “Always tell the truth and you it! won’t have to remember anything…” base your Consultation: whilst consultation relationship with your funders takes place during the HLF on this Mark Twain quote. Round One (development stage) and is an essential part They want your project to of devising any project, it is succeed and they have seen it important to not make all before – so keep talking to assumptions about them, trust their experience and stakeholder’s awareness of input and let them know about your plans. Tenants, funders, the lows as well as the highs! neighbours and consultants on
Stakeholder Management an end for the client, not a means in Image courtesy of Underfall Yard itself. This can be one of the most important aspects of the project. If It is exhilarating, time consuming you don’t manage communications and exhausting - yet the day after and keep your stakeholders completion the day job starts again, informed then there is a strong often in a wholly new operating likelihood that your project will be environment. misunderstood or be publicly criticised for disruption caused or The project team isn’t there to help simply for lack of communications. you with that! And you thought The success of a project can be you’d book a well deserved badly affected if the support of holiday…. think again! stakeholders and communities is So, the key is to plan appropriately, lost. programme all the organisational actions necessary and ensure that Resourcing the Post time and capacity exists, Opening Phase remembering that after the elation of completion there can be team deflation! Delivering capital projects can be all encompassing, especially for small And then relax in the knowledge organisations. But it is a means to of a job well done!!!!!!! AIM Success Guide 26
Appendix Procurement
Index Procurement practices relate to all TIPS services whether professional Service Briefs teams, individual service providers Procurement equipment, construction, fit-out or ▪ A well thought through Legal Contracts other project needs. service brief leads to Due Diligence good tender outcomes Guarantees Agreed procurement policies are ▪ Learn from the Types of Building Contract an essential part of all successful experiences of others project management. Service Briefs ▪ Engage your Project The organisation commissioning Manager early to assist Key to delivering excellent capital works and services may have a projects is to have spent time, procurement policy of its own and ▪ Consider the often with the Project Manager if this must be tailored to incorporate advantages, against appointed early in the process, in the requirements of funders where the costs, of developing detailed briefs for all public money is involved. procurement of services (e.g. architectural, separate PM and QS structural engineering, Mechanical The latter can be onerous and time services, with both & Electrical engineering etc) to be consuming. Procurement lead separate from procured. times are often longer than architectural services, expected and are not necessarily all reporting direct to Some elements of these are consistent over time as market the client (greater standard and formulaic, but in part conditions change. independence and they will be specific to how you allegiance to the client work as a commissioning client Procurement Rules can result). and the actual works required for your project. Early engagement of professional services such as Quantity Because they inform the tender Surveyors and Project Managers process, they provide the earliest can be helpful in getting the indication of how good a client you procurement process right and can will be, what standards you expect, help to avoid mistakes and what the project ethos and programme delays. outcomes are and how professional the existing team is. The rules for procurement on projects are covered by Much can be learned from the procurement regulations and experience of others in your protocols. networks that have delivered successful projects. People are Within the public sector and often happy to share their publicly funded projects, if services knowledge. such as an Architect or works are above certain value thresholds It is likely that the first brief to write then they are required to be is for the services of the PM who, advertised via the Official Journal once appointed, will go on to of The European Union (OJEU). develop the other briefs with you. These relate to competitive Getting this first one right is advertising, rules for the provision fundamental to success with the of information and tendering scope of their role and standards. responsibility critical. 27 AIM Success Guide
Too detailed to cover here and It might be perfectly acceptable to potentially something that might simply take a contract as written change after Brexit, although the and not waste money on legal fees principles are unlikely to change but it is never acceptable not to Procurement Lead Time much as they are good practice. read the contract and look for risk Tips areas. There are ways of procuring some ▪ Proper competitive ten- things more simply: small works A good example is the cost related dering to meet “public packages (small elements of a to weather delays. Contractors will funding” requirements project best carried out by known often try to pass weather related is time consuming and trusted contractors directly delays to the client but the client ▪ Consider your procure- employed e.g. traditional doesn’t need to accept these. It ment options early and (signwriting) let without doesn’t take much experience to if necessary take ad- competition, exceptional single realise that such delays can be vice as it can save time tender actions (the work is so very costly. and costs, but more specialist that only one contractor importantly improve exists) where specialist (“unique”) The same applies to risks related quality and de-risk your services are required or the use of to ground obstructions when project “approved supplier frameworks” a excavations are needed. These list of suppliers/contractors that can sometimes be passed to the ▪ Spend time to make have agreed acceptable rates for contractor within the contract. sure the scope you’re certain works agreed as part of asking for meets your previous competitive tendering) As with all purchasing the old requirements and no can be valuable and acceptable adage of “buyer beware” will set more but this should always be tested you in good stead. against policy, competitiveness, ▪ In your plan, build in other contractor coordination and contingency for the pro- funder needs, before committing. curement phases
Legal Contracts ▪ Understand and plan for long lead-in items Contracts for such services come such as lifts and display in a fairly standard format but cases require careful scrutiny and adaptation to specific needs. ▪ Due diligence is time consuming but essen- It is important to spend time tial. developing the “schedule of services” which defines exactly ▪ Decision making proc- what you will receive. This is a esses often compound client responsibility, don’t expect a lead time problems lawyer to know what you expect, even if you need one to negotiate for you and to cover the real “legalities”. If you just accept what the consultant suggests, you’ll get what they suggest and not much more in most cases!
First draft Service contracts often favour the supplier. Clearly, the risks associated with entering non favourable contract agreements will depend on the scale and complexity of a project. AIM Success Guide 28
Due Diligence Go and look at jobs they have done and talk to clients. (Due Diligence is the term used to describe the exercise of the duty of ▪ Is the team before you the one care necessary in checking the you will actually work with and is credentials of all those employed in at a team that relates to the planning, managing and delivering references given? New teams a project – quite simply are can be difficult to work with. individuals and companies as good as they say, have they done the ▪ How much other work have they things they claim, do they have the got on and do the resources human resources and time available meet those they say required and are they financially will be there to work on your sound, now and for the duration of project? Over-stretched teams the project?) don’t deliver well.
Most clients understand the need ▪ Do they understand the for due diligence but don’t specialist working environment necessarily think through what is that museums and heritage sites required. There are some basics provide? Listed buildings, to consider: collections care, archaeological sensitivity and empathy ▪ Financial resilience of the Your due diligence will depend on constituent elements of teams. scale of project, type of project The Principal must be robust but organisational approach to risk and so must significant sub- many other factors, but always contractors. Always check that think about what’s needed well in the latest accounts are up to advance of tenders and make date enough to reflect the arrangements accordingly if delay current situation. Seemingly is to be avoided or short-cuts successful, fast growing taken. contractors are often vulnerable to cash flow issues but seem attractive because they are successful
▪ Do they pay their sub- contractors on time?
▪ Do they have a reputation for being contractually minded in an attempt to increase income at the client’s expense? Talk to other clients and be sure their tender meets the work specification fully.
▪ Do they have a good reputation for completing on time?
▪ Do they have a good reputation for working with other disciplines?
▪ Have they actually done what they say they have? Don’t just rely on their preferred referees. 29 AIM Success Guide
Guarantees - Parent Company Administration leaving little for the Guarantee and / or Performance contractor’s creditors to claw back. Bonds A performance bond is insurance TIP At the time of procurement, taken out at the beginning of a particularly of significant works project to assist recovery of costs Once you have your contracts, it is advisable to in the event of a crisis. signed Parent Company stipulate that the tenderer is to Guarantee and or confirm that they are willing to They traditionally cover up to 10% Performance Bond LOCK provide a Parent Company of the main contract cost. it in the safe! If you have Guarantee (PCG) and or a to draw on them it’s as Performance Bond (PB) within a Such insurance might seem good as a cheque certain number of days of excessively expensive and appointment. unnecessary if you have recruited a great team and planned carefully, In simplistic terms; If a contractor but things do go wrong because of has a parent company and the the many external factors contractor gets into difficulty and discussed and the bond can has to go into Administration or represent the difference between Liquidation then if you have a PCG completing a successful project the parent company remains liable and not doing so. to complete your project. If things go wrong it is absolutely If the Contractor does not have a essential that all costs resulting Parent Company then a from the problem are collated and Performance Bond will provide you evidenced. with an insurance. The bond will only pay out on proof Getting a PCG and a PB is good of legitimate additional costs which thing because, if a contractor has a can be significant. Parent Company and you only have a PB, the parent company Great project and financial could strip assets from the management of the minutiae contractor before it announces that remains essential when all around the contractor has gone into you seems to be crumbling!
Image courtesy of Brunel Museum AIM Success Guide 30
Types of Building Contract especially in relation to quality standards, materials used and Contracts for the delivery of the consistency of design details capital project itself come in a because the contractor has variety of forms. Professional more control over how the advice should always be sought capital works are designed and before entering into contracts. delivered. Unless very For example four options that may carefully defined such be considered are: standards might not be those desired because the contractor 1. Construction Management. might seek to maximise profit Here the client effectively through minimising cost rather assumes the responsibility of than delivering a better “Principal Contractor” working outcome defined in ways other with a number of individual than cost. small contract packages. This can be highly cost effective but 4. Hybrid of the above. the role of “Principal Contractor” is an onerous one that should not be taken lightly with risks such as; health and safety responsibility, contractor coordination, delay etc resting with the client.
2. Traditional Principal Contractor based contracts where a contractor tenders to deliver a carefully defined package of works, covering several professional disciplines, for a given price. There are different contract forms that can be used, some more favourable to the client than others. The client can specify the form of contract which can be of benefit. The key with these contracts is to define the work content as closely as possible to prevent the need for later changes, additions or delays through omissions. Your professional team must be managed carefully to achieve this.
3. Design and Build Contracts (D&B). Such contracts tender for an overall programme of works and capital outcomes to be delivered by the contractor in the way that they see most effective for a given price. These contracts are often very competitive and good value for money but there are risks AIM Success Guide
Image courtesy of The Historic Dockyard Chatham AIM Success Guide
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