Professional Documents
Culture Documents
Pekka Petjniemi, Finnish Transport Agency Lauri Merikallio, Vison Alliance Partners ltd
Short bios
M.S. (eng.) Pekka Petjniemi, Finnish Transport Agency Director, Investment Projects over 25 years experience in infrastructure industry in Finland and Germany
Partner, M.S (eng.) Lauri Merikallio, Vison Alliance Partners ltd Consultant and researcher 2008 Executive and project tasks for over 20 years in infrastructure industry Visitor scholar in UC Berkeley 2006/2007
19/9/2013
www.liikennevirasto.fi
www.liikennevirasto.fi
www.liikennevirasto.fi
www.liikennevirasto.fi
Some History
Research project of the Project Alliance 2007/2008, no piloting
LCI comes to Finland 2008 Lean principles, Integrated project deliveries and Lean Construction tools and methods started to achieve understanding
LIPS in Karlsruhe Germany 2009, Jim Ross introduced the Project Alliance EU-legislation challenge in the public sector LIPS in Washington DC 2010 We might be able to challenge the EU-legislation LIPPI in Brisbane Australia 2011 First Project Alliance has been established, several others coming LIPS in Tampere Finland 2012 We have four alliance projects LIPS in Nottingham 2013 We have six alliance projects and some hybrids, more coming LCI-Finland has 4,5 M R&D project 2013-2015
www.liikennevirasto.fi
www.liikennevirasto.fi
www.liikennevirasto.fi
Two possible selection criteria: The lowest price or the most economically advantageous tender (so-called quality and price) In our case, we are going to use limb 2 as a price element. Contracting entities should write out justifications for every comparison criteria
www.liikennevirasto.fi
11/25/2010
www.liikennevirasto.fi
www.liikennevirasto.fi
The Finnish Transport Agency is responsible for maintaining and developing the level of service in the transport infrastructure administered by the government. The Agency is accountable for an infrastructure property of nearly 19 billion euro.
The aim of the Agency is to promote the functioning of the transport system as a whole, to improve transport safety and to contribute to a balanced and sustainable development of the regions. Of the Agencys approximately 700 employees about 150 are stationed in the regions (20 %).
The Agency procures transport infrastructure services from the market. Yearly procurement budget is 1,5 billion euro
9 www.liikennevirasto.fi
Procurement capability
52
61
Network skills
64 67
Partnership skills
61 62
61 FTA
FTAs strategic targets for using procurement models which improve productivity
Background:
To improve productivity of the entire industry To change the culture into a more open and trusting way of working To improve the customer satisfaction for end products faster, better quality
and cheaper To develop innovativeness and knowledge
www.liikennevirasto.fi
Competitive negotiation Request for Proposals process phase 3-stage selection process
RFP response stage Stage 2 Stage 3 Stage 4
PDA
Proponents prepare and submit RFP responses and prepare their teams for the selection process and eventual alliance.
Selection to stage 3
proponents
Commercial discussions with Development each Proponent Workshops workshop with with 2 Proponents each Proponent proponents tender their The Fee proponent
selected
Final scoring of the RFP responses and selection of the two best proponents Establishment Audits
Estimate Systems Audits
12
Final evaluation of RFP responses Selection of and scoring preferred Proponent www.liikennevirasto.fi
Selection criteria
Weight Evaluation criterion A. A1. A2. Capability Project implementation plan and organsation A1.1 Project implementation plan and organisation Track Record A2.1 Track record in Key Result Areas A2.2 Learning from mistakes Value for Money A3.1 Setting the target outturn cost A3.2 The budjet critique Alliance ability and leadership A5.1 Alliance understanding and demonstrated leadership capabilities Price Fee % A+B Total Stage2 total 100 % 25 % 35 % 25,00 % 10,00 % 40 % 25,00 % 15,00 % 0%
no eva l ua tion
sub
25,00 %
A3.
A4.
B B1
25,00 % 100,00 %
100,00 %
www.liikennevirasto.fi
13
www.liikennevirasto.fi
Challenges
Contract tendering takes time and resources maybe more than other procurement models Very hectic 6 months period for competitive bidding Many participants to coordinate
No chance to modify the time table So far the Alliance model is new to everyone
Liikennevirasto
14
www.liikennevirasto.fi
After announcing that Rantatunneli will be an Alliance project NOPs began to seek partners one year prior RFP Consortiums started coaching and training process
New resources and commitment required during selection process Construction and consultant companies Owner
Common information and development workshops are very important for the owners and NOPs Better understanding of each others business
New roles
The feedback of NOPs has been mainly positive Consortiums are waiting for the next projects
www.liikennevirasto.fi
Yli-Villamo 11.9.2012
www.liikennevirasto.fi
Besides the renovation there are needs for improvements, such as: Removal of railway level crossings. Reinforce surface and bench structures of the railway track so that it is possible to operate on 250 kN in 80 km/h.
17
www.liikennevirasto.fi
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
Close collaboration in safety issues. Everyone works together with jointly agreed goals and common rules. Collaboration in work coordination, management of change and innovative problem solving create efficiency. Training and guiding play a key role New way of collaboration requires constant learning during the project Continues improving (plus and delta)
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
18
www.liikennevirasto.fi
Project Implementation Phase, Key Performance Indicators status are tangible and easily measurable (KRA) ESTIMATE 60/30% PTU
Key Performance Indicators
LielahtiKokemki alliance, project implementation phase Key Result Area Performance Indicator Performance levels 2012 performance 99,493 99,974
Poor Usability and interference Passenger traffic precision (%) Freight traffic precision (%) Schedule Project completed (including commisioning and all necessary documendation) Traffic and work safety Railway traffic safety defects Work safety indicator (%) Accident frequency 25 75 100 31.5.2016 70 70
Excellent 98 98
31.5.2015
28.2.2015
31.5.2015
6-10 93 18
0 100 0
1 95,1 12,7
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
19
www.liikennevirasto.fi
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
20
www.liikennevirasto.fi
Achievements, schedule
Alliance Schedule
Railway planning Construction planning Construction
Traditional project
2011 2012 2013 2014 2015 2016 2017 2018
Commissioning
Alliance model enables more efficient lead times by overlapping project phases (goal is to complete three years in advance compared to traditional models) In particular, managing administrative procedures and doing actual construction works simultaneously has been efficient
27.5.2013 mikko.heiskanen@fta.fi 21 www.liikennevirasto.fi
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
22
www.liikennevirasto.fi
WE
27.5.2013 www.liikennevirasto.fi/lielahtikokemaki 23 www.liikennevirasto.fi
20.9.2013
KI
24
www.liikennevirasto.fi
27.9.2012
27.5.2013
www.liikennevirasto.fi/lielahtikokemaki
25
www.liikennevirasto.fi
Liikennevirasto
26
www.liikennevirasto.fi
2 pieces of one-way 2,3 km road tunnels in Tampere city center Interchange in both ends and provision for one in the middle Daily traffic volume now > 40 000 In the future 2030: 54 000 The estimated costs 185 M Development period July 2012 autumn 2013
Liikennevirasto
27
www.liikennevirasto.fi
11/25/2010
www.liikennevirasto.fi
28
www.liikennevirasto.fi
Lean tools and methods used in the Tunnel Project developing phase
Early involvement Depency Structure Matrix, DSM Target Value Design process Last Planner System Modularization in Tunnel construction and Tunnel Systems (safety and control)
Continues Improvement
Liikennevirasto
29
www.liikennevirasto.fi
Challenges
Adopting the working culture when people are working also in other projects, turning the alliance mode on Finding good incentive elements for subcontractors Key employees possibilities to focus enough, because the working in alliance is very effective things do not wait they go on Find the right and important experiences from the Pilot project
Liikennevirasto
30
www.liikennevirasto.fi
Idea
Lessons learnt
APPROVED
Clear evidence of innovation promotion Explode the ideas and innovations systematically Direct costs and fees will always be paid for the service providers We can plan and prepare right things in the right time
ROAD
BRIDGE
TUNNEL
TECNICAL SYSTEMS
Liikennevirasto
31
Liikennevirasto
32
www.liikennevirasto.fi
Compensation Model
Everyone's financial result
depends on the result of the Alliance, not just on their own performance
Profit
Corporation overheads Project-specific overheads Fee Limb 2
Compensation model
Direct costs are reimbursable (project costs) Corporation overheads and the profit (Fee) are maximum risk for the proponents Gainshare / Painshare regime is common and will be shared in rations that are agreed in advance
2.9.2011
33
www.liikennevirasto.fi
Bonus pool 2,0 % of TOC Positive/negative modifier -10+20 p Traffic arrangements during execution + Lifecycle costs + Damages + Black market Rail Highway 12 -
Final gain/pain
34 www.liikennevirasto.fi
- Work in progress
- Coaching teams what value for money means and how everyone can add value
35
www.liikennevirasto.fi
Summary
Flexibility, innovations, culture change, commitments can be achieved by using alliance model Implementing Lean in Alliance projects is useful and powerful Project alliance is useful in very complex environments (political, social, technical, etc) Price-component development has to be continued
Liikennevirasto
37
www.liikennevirasto.fi
Jrvenp Hospital 2013-15 Establish the alliance 05-08/2013 Project developing phase 09/2013 Target estimate cost 50 million
Terveyden ja hyvinvoinnin laitos 2012-14 Senaatti Properties, NCC Developing phase 2012-2013 TOC 18 million hybrid Helsinki-Vantaa Airport pavement services 2012-14 Finavia ja Lemminkinen Infra Oy TCE 20 million Hybrid Lielahti-Kokemki rail 6/2012-15 FTA & VR Track Oy TOC 106 million
Tampere Tunnel 2012-17 City of Tampere, FTA NOP: Lemminkinen Infra Oy, A-insinrit Oy ja Saanio & Riekkola Oy Project developing phase 08/2012-09/2013 Target Outcome Cost 180,3 million
Strategy decision
Implementation Phase
www.liikennevirasto.fi
THANK YOU
Questions!
pekka.petajaniemi@liikennevirasto.fi lauri.merikallio@vison.fi
www.liikennevirasto.fi