NETWORK RAIL REFORMS SET NEW STANDARDS FOR WORKING WITH INDUSTRY

Network Rail has become the first company in the rail industry – and only the thirteenth nationwide – to achieve BS11000, the new British Standard for collaborative working. The success comes in the midst of a programme of wide-ranging reforms to the company’s infrastructure business, which place greater focus on partnership with suppliers and will see a restructuring of the way the company delivers capital projects worth around £4bn a year.

Greater collaboration between organisations within the rail industry was identified by Sir Roy McNulty as one of the means of delivering greater value for passengers and taxpayers – with BS11000 one of the tools Network Rail intends to use to improve the way it works with its supply base to drive down costs.

Five pilot projects, each demonstrating a different approach to partnership between Network Rail and its suppliers, were put forward for assessment against the standard. Formal accreditation was presented to Network Rail today at an event attended by transport secretary Justine Greening and partner organisations from across the rail industry.

Simon Kirby, managing director, infrastructure projects, Network Rail, said: “Network Rail is making big changes that will bring us closer to our customers, make us more efficient and get better value for money to both passengers and taxpayers. Achieving BS11000 shows that these changes are already beginning to deliver in the right way.

“The BS11000 standard gives us the strategic framework to develop, with our key suppliers, the policies and processes, the culture and behaviours required to establish successful collaborative relations and to drive continual improvement. Maintaining collaborative business relations can only lead to benefits for Network Rail and its suppliers, for the rail industry and for Britain.”

Neill Carruthers, head of contracting strategy, infrastructure projects, Network Rail – who led Network Rail’s BS11000 accreditation process – said: “Delivering a culture change programme within a large organisation like Network Rail is a significant undertaking. Extending this to our dealings with the supply chain and customers is greater still. Our success is testament to the hard work of everyone involved, both at Network Rail and our supply partners.”

Jeremy Candfield, director-general of the Railway Industry Association representing the railway supply industry, said: “Getting supply chain relationships right is fundamental to achieving a more efficient railway. RIA has long been supportive of greater collaboration and transformed supply chain behaviours and there is a natural fit between BS11000 and our own Value Improvement Programme initiative in reaching those goals. This announcement is therefore an important step: we welcome it, and we look forward to working with Network Rail in the new framework being put in place today.”

Rob Wallis, managing director for Europe, Middle East and Asia at BSI said: “BSI congratulates Network Rail and its partners on this outstanding achievement, which demonstrates the organisation’s best practice approach to partnering. With particular relevance to the supply chain, we believe implementation of the BS 11000 standard will improve performance, stimulate innovation and deliver cost efficiencies whilst meeting mutually defined objectives for all partners.

“More importantly, we hope it will help Network Rail meet its primary objectives of cultural and behavioural change as a result of more collaborative working. By sharing knowledge, skills and resources from an early stage Network Rail will be better placed to overcome uncertainties and risks and work with its partners to develop and manage interactions for maximum benefit to all parties.”

A new approach to infrastructure project deliveryNetwork Rail is currently undertaking a series of reforms which will see fundamental change to the way the company does business. Day-to-day responsibility for the operation of the railway has been devolved to ten route managing directors, working closely with their customers in the train and freight operating companies. This summer, the company’s new national centre in Milton Keynes will be home to more than 3,000 people providing a slimmer, stronger support structure for the routes. And alongside these changes, wide-ranging reforms are being made to the way Network Rail delivers infrastructure projects, including a separate projects business working in collaboration with the supply chain.

As part of Network Rail’s partnering strategy for the new projects business, different contracting models have been developed with varying degrees of complexity – from simple outsourcing to full design, build, operate and maintain limited partnership. The main focus of Network Rail’s supply chain arrangements currently is on the use of the alliance, delivery partner and engaging models, which were each represented across the five pilot projects:

• Crossrail south east section project – Balfour Beatty Rail Ltd
• Finsbury Park to Alexandra Palace capacity improvement – Balfour Beatty Rail Ltd
• Hitchin grade separation – Hochtief UK Ltd
• Reading station civil engineering works (package IMP1&2) – BAM Nuttall Ltd
• Edinburgh to Glasgow improvement programme – procurement process to commence soon

Work has already started on the expansion of Network Rail’s BS11000 programme for the next financial year which will see other major projects added to the initial pilot portfolio of projects. The capital expenditure value of these additional projects will increase the overall value of projects working under BS11000 to almost £3bn. The next phase of the process will also see further training and development within Network Rail as the company investigates the scope for the adoption of BS11000 within other areas of the business.

Network Rail has worked with the Railway Industry Association and Partnership Sourcing Ltd to provide briefings to the company’s supply chain about BS11000 and the benefits of this approach. A number of Network Rail’s strategic partners are currently in the implementation and assessment phases for the standard, with best practice being shared throughout the industry for mutual benefit.

Notes:

In April 2012, Network Rail Infrastructure Projects will align itself with the ten devolved routes as a regionally-based delivery business. By mid-2013, the aim is to develop Infrastructure Projects into a subsidiary company which will be part of the Network Rail group. The long-term goal is for Network Rail Infrastructure Projects to be the leader in providing rail infrastructure solutions in Britain; its success will be built on strong collaborative relationships with suppliers, clients and customers.
Network Rail is the first organisation in the rail industry to achieve BS11000 and only the thirteenth overall since the standard was introduced in 2010.