Access to water, sanitation and hygiene is a human right. However, the demand for water has outpaced population growth, and half the world’s population is already experiencing severe water scarcity at least one month a year. In addition, increasing global urbanisation, coupled with rapidly ageing water networks poses a major challenge for water service providers. Improving the delivery of capital works and maintenance of water networks is essential to improving access to water and to do this, we need to rethink how we deliver infrastructure.
Sydney Water has done just this with their Partnering for Success (P4S) framework, showcased in GI Hub’s Improving Delivery Models, which saw the appointment of long-term integrated planning partners in 2019 and a 10-year partnership with three regional delivery consortia from 2020 for all design, construction and maintenance works.
Mark Simister, Head of Program Delivery, Sydney Water, is responsible for implementing the framework and joins the blog today to share more about P4S and his insights on broader trends in the water sector in Australia.
Q: Why was the P4S framework created? What challenges is it trying to address?
Sydney Water recognised that we needed to adapt our delivery model to cope with future infrastructure growth and increasing demand. Greater Sydney expects 2.71 million more people by 2036 so infrastructure was going to be a very complex element to work with.
About three years ago, we started to update and adapt our infrastructure delivery program to meet these future challenges and increasing demands. We needed to determine the right response to be in a fit position to deliver the infrastructure needs of our customers going forward. P4S went live in July 2020 as a new procurement model that offers integration, consistency and value for Sydney Water's five million customers.
Q: What are the key components of P4S?
P4S covers planning, design, construction and maintenance, using the global suite of contracts called NEC4 (New Engineering Contract).
Under P4S, we signed a 10-year partnership with three regional consortia and two companies, Aurecon and Arup, as our long-term planning partners in 2019.
As part of P4S, we now have a pool of specialist suppliers that can be leveraged by Sydney Water and our regional consortia under something that we call Shared Purchasing. It’s a simplified way to procure goods and services, especially those that the regional consortia can't perform themselves. Shared Purchasing enables a quick, consistent and transparent way for us and our partners to receive the goods and services that we need for our delivery.
Q: How has the P4S framework performed on its first year? What improvements have been realised?
P4S will enable us to deliver at least AUD4 billion worth of work for the next decade and undertake our major projects. A 10-year horizon is needed to get a full picture of the benefits in terms of the desired outcomes including value for money, safety and quality improvements, community, and creating a legacy.
We have also seen the benefits of a significant improvements in the speed in delivery. As they say, time is money. Projects that traditionally take two to two and a half years are now being delivered in 12 to 18 months - a huge efficiency in terms of timeliness for delivery. In the past year we’ve awarded over 300 projects, started construction on 34 of those and delivered over 100,000 maintenance work orders. In addition, we established three regional offices and onboarded over 1,000 employees in a fully integrated environment.
Q: Compared to other projects like the Lower South Creek Treatment Program, which used a Delivery Partner Model, what criteria made the P4S framework suitable?
Lower South Creek was a one-off program covering three treatment plants. The aim was to drive collaboration, performance and innovation through a single program contract supported by clear roles, accountabilities, and commercial agreement. P4S had a longer and deeper ambition. Not only was it timely, with the majority of the existing business contracts and regulatory periods ending; but it was initiated in an environment where many existing process and frameworks globally had been seen as failing. P4S was therefore established as a 10-year framework tasked with delivering all works in both the Capital and O&M (operations and maintenance) space. This was coupled with the drive to change how the business related to its supply chain, aiming for shared benefits and improved employee and customer experience. In addition, the design was for enterprise-wide alignment in procurement and delivery processes, providing a pathway for improving the maturity of both Sydney Water and the wider supply chain.
Q: There have been several innovative delivery models implemented in the water sector in recent years that make use of longer term partnerships – e.g. Watercare Enterprise Model (New Zealand) and Team 2100 (UK). Why do you think this is and should these types of models be applied to other economic infrastructure?
I certainly do think new ideas and models need to be applied. Whilst attempts to implement new approaches have been initiated over the last 20 years or more, from early Alliance’s to Delivery Partner models, most have not targeted the enterprise level of change and challenge to traditional delivery.
Attempting one-off projects or isolated models makes it difficult for the owner and supplier to embrace change and achieve the full benefits on offer. Furthermore, many infrastructure leaders have not moved on from the adversarial and combative approaches of traditional delivery, where wider benefits related to safety, community and staff outcomes are not considered alongside financial outcomes. This often leads to a great deal of value and opportunity being left on the table.
In recent years, there have been many high-profile problems and failures with delivery of major projects and programs which demonstrate a fundamental, most often, human centered issue to address. If we keep doing what we always did, we will get what we always got. Times and the environment for delivery has changed. It is high time the frameworks and models adapted too.
Q: Turning back to the application of the P4S framework, what are some of the benefits for the parties?
The intended structure for P4S has Sydney Water working with a planning partner, three regional delivery consortia and Shared Purchasing. The framework looks to simplify the very complex network of suppliers that we used to have, and we've managed to rationalise and focus on excellence within our supply chain.
We established strategic relationships with planning partners and suppliers that would be able to deliver not only quality, but also innovation and longevity of service to work with us. We not only brought in a new delivery framework, but we also worked to understand what the best practice is around the globe. A key element of this was for us to engage in a global infrastructure movement called Project 13, making Sydney Water the only international member. As part of the integrated Project 13 community, we can share ideas, innovations and challenges with governments and other organizations.
Through P4S, we also brought in a new contract framework that is a less combative approach to working with our supply chain. We wanted a more collaborative way of working that looks at a win-win scenario — a win for our customers, a win for our suppliers and a win for us at Sydney Water. We felt that the best contract that would work with that was the New Engineering Contract series 4 suite of contracts, which have proactive project management built into them. The second clause of the contract is about working in a spirit of mutual trust and cooperation, and it's designed to identify early problems and look for early resolution of any issues, saving you the pain of getting too caught up trying to deal with things without having to get to a difficult and complicated litigation at the end. Our objective is to work upfront, be very proactive and be a very engaged owner.
The benefits we see from P4S would be better customer outcomes; better integration; resource security for us and our supply chain; greater efficiencies and savings; and increased incentive and competitiveness. We want our partners to work with us and be challenged, but also to look for opportunities to come up with new and improved solutions. We want to be able to upskill not only our own resources; but we want to see an improvement and maturity in the whole supply chain that we at Sydney Water engage and work with.
Q: What’s the future of the P4S framework for Sydney Water? Are there aspects that still need to be improved?
We built P4S to look into the future, and we would like for our partners and suppliers to come along with us on the journey and to mature with us as a framework, as an environment and as a place in which we can look to provide better service to our customers going forward.
As I’ve mentioned earlier, we'll be working to get a benefits case over the 10-year period of P4S implementation. We’re looking at maturity in terms of diversity, innovation and digital engineering and we're building a digital spine into our entire delivery framework.
We're also looking to ensure that we continue to collaborate as we mature and leave a legacy for the future. To this end, we find that it’s important to build a strong workforce, both blue and white collar, to meet the growth of infrastructure and demands. We're working with universities, schools and other educational facilities to be able to help secure this workforce for the future.
Explore GI Hub’s Improving Delivery Models initiative here.