Hi Erik - personally I don't think that you are the last one to figure it out, and if I might observe, I believe that there are many others around the world trying to work out what it means for them.
There's two things I'd contribute to your thinking, which are caveated in the usual way (i.e. my views and not necessarily those of my employer) :
1. I think that there is a financial cost to the organisation in seeking to embed these. It's a discussion that I've found has meant that it's hard to get real traction - as whilst the requests for these initiatives come in, there has not been the additional funding provided to many Government organisations to get his going. Sure, it's argued that there are other benefits - often more widely outside of the organisation - but many organisations aren't winning the battle with their finance teams that could see this progress.
2. I have been impressed with the approach of the IRD team in New Zealand. From the presentations that I've seen from Karen Whitehouse and the team, they picked one of the UN goals that was most relevant to them, and looked to focus on that. I think this will be more effective than those who try to achieve too much by looking to incorporate too many of these goals into their procurement activities.
We've looked to take that thinking on board into our operations. Given our contracts are split into portfolios, the challenge for my team in 2020 is to get the business agreeing to an area of focus and measurements for each of these portfolios. These might be the same, or they might be different, but we're using that approach to get the business owners, as well as the leadership team to buy into it, so it's not us going it alone.
Like you, I would love to hear how others are approaching it - it's brave of you to start a topic by making yourself vulnerable, but I think that you're in good company.
• NXB AB
Hi Darren, thanks for your contribution. I will add, in terms of motivation, that the Swedish government yesterday announced their long-term strategy towards a sustainable society in general and climate activities in particular. As always, there were many (130) activities, more or less concrete, but a very firm statement by the minister was that they will demand from all public procurement to embed the Agenda and thereby drive the change process.
Obviously, there are a zillion question marks on how to do it (sounds a bit like "how to eat an elephant") and I believe that selecting the goal(-s) that are most relevant would be a decent strategy with a good chance to succeed. I looked at the IRD homepage but could not see a whole lot. Is there a write-up of some kind that I could get access to.
Btw, I am glad to see NZ being active, Tim mentioned it to me and I really believe that us smaller countries are quicker to decide and get going rather than just talking. Denmark is also, as I understand it, acting in the same direction and I honestly believe that we together could put together an IACCM statement of some kind, given that we find more material.
• Ngamuru Advisory
You've hit on a really good topic. As I sit here in Australia in the areas affected by fire and storms the need for broader outcome as part of public spending is not lost on me. So much so I recently wrote an article on my blog (www.performancebasedcontracting.com) on this topic. I also mentioned that this is being used, or trying to be used. I'd be happy to provide more details directly if you need. Key thing is that it is possible, just not typical. And I hope we can all change that!
Dr Andrew Jacopino, IACCM Fellow
• NXB AB
Hi Andrew and thanks for your encouraging article. We seem to have things bubbling here and there in the world and I understand that Tim Cummins is taking a lead from an IACCM perspective, that you are involved and that I will try to contribute to the best of my capability.
Meanwhile, I continue to make myself present in the public domain, an interesting effort after 44 years in the private sector. There is no doubt in my mind that the "public muscle" is a major enabler to introduce a more targeted, ambitious and future-focused trading practice.
In addition, I hear more and more that having a common purpose and an encouraging, visible leadership is more engaging and motivating to coming generations entering the labour market than career paths, personal benefits and generic power and status symbols. Without a clear purpose and professional leadership "the good ones" are gone. Yesterday, the CEO of Scania, producer of heavy trucks, buses and other machinery, said exactly this in a TV interview. My contacts with leaders in the public sector say the same.
Tomorrow, I will meet with a few like-minded people in Copenhagen and look forward to continues communicating with you and others in IACCM on the subject. A "viral approach" will be very important, I believe!! There are big and well funded opponents to a change in the current activities.
Dear Carrie, I have experience from pricing changes both during the negotiation process and during the contract lifecycle. Our clients have especially found this as an effective tool during negotiations to demonstrate risk/work-impact if the other party is requesting terms transferring an extensive part of the risk/work to them. By showing the cost-impact, the incentive for price increase becomes rather obvious which strengthens your negotiation position. Kind regards, Madeleine Willyams - Advokatfirmaet Negota AS, Norway.
Personally, I would say the 10 are still applicable today (Jan 2020). I also think the point about how fast the world is moving - particularly technology wise - is true and it has only sped up even more in the past 5 years.
This is definitely something that should have greater consideration in my organisation, I have been quite vocal in pushing it. I have worked in teams where particular members have found the lack of bounds extremely stressful as they feel they are crowded out or put upon by the more vocal members, who are equally frustrated it takes so long to get things done. Clarity in defining the roles and responsibilities can often be an enabler.
• Airbus Defence and Space Limited
Agreed, this is a great article and really gets you thinking about the behaviours instilled within your own immediate team. If we cannot get the behaviours and roles clearly specified for our own team members first we are setting ourselves up to fail in the wider team and externally.
Agree - this was quite an insightful article. I've always believed that it should work in reverse - that you should set the objective and then leave it up to individuals to work out how to get there, which is what the article says except for specifying that their roles need to be clear. I believed that if roles were less clearly defined then it gave people scope to expand their remit, however I can see why this can cause confusion.
Ive had a lot of experience of very dominant Clients who are never willing to negotiate any give on their side, only improvements for them. I have found you need to identify this type of individual very early on in the process and realise that this behaviour will not change through the lifecycle. Decisions need to be made as to whether the deal that you are being faced with is worth it or not - is it good business for you or are they asking for too much. Id love to hear any specific approaches of how to deal with this type of client as its not easy.
• Contract Manager Canada Inc.
If the project is delayed by the Employer... first make sure that there were no delay causes by the Contractor on the previous agreed milestones, for you to be fully eligible for a compensation. Now the tricky part to kick in, is the delay resulting to only warranty extension, which means that all construction, installation and pre-commissioning done? Just ensure that you've all signed-off documents that it's pre-commissioned. if so, your service team will provide an additional cost for extra-warranty coverage and you can lever it as a scope-creep. This is not an issue, if all of your works are completed and no more to come back to do additional works, then you need to add remob to commissioning cost plus the extended warranty cost and get a CO prior to agreement of extension. Don't forget to have your insurance company informed on this extension, as they were notified of previous warranty commitment, not the new one. Hope this serves.
• Seiersen Enterprises
It strikes me that the actual costs of extending the warrantee might be considered.
These may be nil if the delay in the project delays the in service date, and thus the risk of fault.
The onus might be put on the supplier to prove the materiality of additional warrantee costs whatever they might be.
• Capgemini India
As warranty effort is provisioned to fix bugs of contractor's defects, since the delay is caused by the Employer, the Contractor is entitiled to claim additional cost. Not only is this instance 'due to failure of the employer (customer)', which is not due to cause by the contractor, there could also be a delay in the service start date, which means the plans for service could be impacted. Therefore, I believe the additional cost is justified.
Our service department has actually been able to provide a number for us by unit of what an additional year of warranty costs us. Do you know how much the first year costs you? You could always just submit that as an estimate for year two.
It´s a pleasure to share the information with you and the colleagues of the forum.
So, in Brazil many companies has been implanting CM in their structures but still have many doubts about this area. Sometimes managers asking me about the difference about contract management and project management.
Nowaday I work for a steel company in Brazil and has been implanting with a team a contract management area to help the company to reach their strategic results.
Rio de Janeiro - Brazil
• New Zealand Defence Industry Association (NZDIA)
Public sector all over the globe. IT and Infrastructure. When mining and Oil and gas pick up would expect more there.
In Australia there is a lot of interest in CM to assist with commercial excellence endeavours.