PROCUREMENT AND SUPPLY CHAIN
– that they’re either ‘in the game’ or aren’t. Obviously they want to win, but they’d prefer to know now.”
McLoughlin said good, competent suppliers will not just be ‘losers’, but will alter their business models, or consider bidding as a tier 2 instead of tier 1 supplier. “The work’s still there,” he said. “We’re working with fewer suppliers, but the volume is still there, and in fact there will be more.”
“There will still be opportunities.”
Kirby added: “The market…is competitive, where even tier 1s may joint venture on one bid, and compete on others.
“We’re seeing consolidation in terms of plant hire suppliers, piling contractors, and we’re looking for higher standards. I expect there to be some consolidation in that space, it’s almost certain.”
McLoughlin spoke of “national strategies but local implementation”, noting that different regions had different priorities and spend profiles. He contrasted the south east’s huge amount of smaller projects, like platform extensions, with the major enhancements on the Western route, including the Reading upgrade, electrification and resignalling.
What’s good for the goose… But longer-term commitments for
only that they will invest in training and in R&D, but that they will treat their own tier 2 suppliers and other contractors in a similar way.
McLoughlin said: “If it’s good for them in their relationship with us, it must be good for them to establish those same kinds of working relationships and that long-term commitment with their sub-contractors as well. We’re increasingly seeing that kind
of discussion,
through the CDF and the supplier forum, and getting tier 1s and 2s together in conferences.
“On the agenda at every single one of our supplier account meetings with major suppliers is ‘how are you developing strategic relationships with tier 2s’.”
He suggested that collaboration has become embedded in a remarkably short amount of time – though said he didn’t want it just to become a buzzword, and said true integration of the supply chain was the next step. Of course, tier 2 suppliers will want to remain free to work with different tier 1s on different projects, and to keep a distinctive presence in the industry – but improving those relationships helps everyone, McLoughlin said.
Safety major suppliers comes with expectations too – not
Kirby and McLoughlin were insistent that safety lies at the core of the changes –
safer, better delivery of major projects is the ambition. They said it would not be compromised to satisfy efficiency savings requirements or to keep costs down, and that there was “no negotiation” on safety.
There is a target in the ORR’s CP5 determination for Network Rail to reach the end of the control period with no major RIDDORs (incidents reportable under the regulations on injuries, diseases and dangerous occurrences), but Kirby said there is also now a much greater focus on close calls.
“We’re looking ‘further down the safety pyramid’ in terms of what’s driving potentially serious incidents, rather than looking at the RIDDORs themselves.
“Our standards of passenger safety are very good, we could easily say our workforce safety is as good or better than most sectors of UK construction, but it’s nowhere near, say, oil and gas. So we know there’s an opportunity to improve.”
As detailed in the October/November 2013 edition of RTM, Network Rail is in the process of overhauling its site safety procedures, streamlining and clarifying safety roles and responsibilities.
One aspect of the change, Steve Hooker explained, was that it wants to ensure only Network Rail employees or those from tier 1 contractors have overall responsibility for site safety.
“If we don’t invest in training people, we’ll end up where we were seven or eight years ago, where because of a lack of investment in people, costs go up because people become scarcer.”
48 | rail technology magazine Dec/Jan 14
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