The Nichols Group warmly welcomes Infrastructure UK’s cost review but sees major challenges in its implementation

2 February 2011

“For this valuable reform to succeed - unlike its predecessors – it needs a clear champion to drive it through” said Mike Nichols, Chairman and Chief Executive of Nichols, a leading company in the field of programme and change management. Mr Nichols is also Chairman of the Association for Project Management."

He was speaking at the launch of IUK’s cost review at the Institution of Civil Engineers in London on 2 February 2011. The President of the ICE this year, Peter Hansford, is an Executive Director of the Nichols Group and is a member of Investigation Steering Group for the report. Mr Hansford added that “infrastructure cost reduction needs to be treated as a radical business change programme in its own right”.

Other key points from the Nichols Group’s comments on how to implement the findings of the review were:

• An underlying cost-driver is the overlaying of detailed standards and compliance-checking (an example is the asset protection agreements in the rail sector). New quantitative economic analytical tools could be used to eliminate or reduce standards that are no longer justified or are not cost-effective ways of reducing risk. Instead of central regulation, responsibility for standards could be given to engineering and project professionals (either individually or through professional bodies) to make judgements and be accountable for them, as happens in the medical sphere and in other countries.
• Most prospective Senior Responsible Owners for future infrastructure projects in Government need more training and mentoring to be able to deliver cost reductions. Priority elements are: clienting skills, management of contingency, and business case/programme scrutiny. Their staff will also need enhanced levels of professionalism in programme management.
• There are some cost-free steps that need only Government policy measures, such as completing National Policy Statements under the Planning Act 2008.
• The practice recommended in Para 3.13 of the report (of cost reduction in the earliest phases) may be more important than other steps identified – there are some innovative practices emerging in the private sector which enable a ruthless focus on essentials.
• The integration of existing approvals and assurance into a single framework would be a valuable step as long as it is simplified, for example balancing the correct new concentration on the early stages (Starting Gate and early termination) by cutting out later phases of the Major Project Review Group/Gateway process.

Background Notes

Mike Nichols contributed detailed ideas particularly on intelligent clienting to the National Audit Office booklet (Opinion Pieces on Improving Commercial Skills for Complex Government Projects). http://web.nao.org.uk/search/search.aspx?Schema=&terms=opinion+pieces

Nichols supports the development of the Thames Estuary

10 January 2011

On 4 January 2011, the GLA’s Thames Estuary Steering Committee published its reports on the future development of the Thames Estuary.

Nichols was instrumental in guiding and co-ordinating the work streams and editing both reports to ensure that they received full support from the Steering Committee and the Mayor of London. This has now provided a solid foundation for investment into future studies.

The Thames Estuary Steering Committee was convened by the Mayor of London and is chaired by Sir David King. Its remit is to independently consider the issues raised by the potential for development of the Thames Estuary.

A press release associated with the publication of the documents can be found here.

Strategic significance to the UK

The Thames Estuary is of strategic significance to the UK for a number of reasons:

• Its capacity supports the growth of the UK’s World City – London.
• It is the engine room of the Greater South East, Europe’s leading ‘super region’.
• It has the potential to transform the area and create new opportunities for many of its currently deprived communities.
• It enables the UK’s most important region to grow and holds the UK’s greatest potential to successfully adapt to and mitigate climate change.
• It contains important and protected historic assets and internationally designated habitats.

Two reports were developed, one directly and the other on behalf of the Steering Committee, by a number of consultant experts who have been actively involved in developing plans associated with the Thames Estuary.

A copy of the Steering Committee report can be found here.

The report calls for acknowledgement by HM Government of the critical importance of investing in the long term development of the Thames Estuary, from both public and private sources.

It also demonstrates the need for an integrated and holistic approach across departmental boundaries to prepare plans for:

• growth
• flood management
• transport
• energy
• water and waste.

A copy of the consultants’ report can be found here.

The report references previous studies undertaken over the last 10 years on the following topics:

• Master Planning
• Mapping
• Social and Economic Generation
• Environment, Ecology and Geology
• Flood Risk
• Power
• Water and Sewerage
• Shipping
• Transport Connectivity
• Aviation.

The report explains the importance of each topic and also how it contributes to the Thames Estuary as a whole. In addition, the report summarises the emerging outcomes from the previous studies and highlights the questions to be answered in any future study.