25.06.2020

Supply Chain Resilience during COVID-19

We spoke to some of our Framework Partners to see just what measures have been put in place to maximise supply chain resilience during these trying times.

John Graham Construction

Measures to retain supply chain resilience

Throughout the current crisis Graham have maintained close dialogue with our material suppliers and subcontractors ensuring we understand the impact across their business and their ability to support our delivery of critical NHS projects and other projects.

We have engaged with them to understand:

•             Impacts on the labour force through illness and / or the requirement to self-isolate

•             Furlough numbers and timing

•             Financial aspects including impact on their cash flow

•             Materials and goods availability as a result of impacts on their suppliers

We have implemented the Supplier Relief principle of Cabinet Office PPN 02/20 with our supply chain members (SCMs) to support them. This ensures that they remain in a position to support our sites as we return to the new normality.

We have kept a focus on the needs of SME and Micro SME businesses we work with, ensuring impacts on them are reduced to a minimum through financial and risk sharing measures. COVID 19 has a significant impact on the project risk profiles, impacting our SCMs. As part of our dialogue with current and prospective SCMs, we review risk and accountability associated with their supply element and agree collaborative and shared ownership so that not all risk is passed down. SCMs financial standing may have been impacted and we continue to do in depth checks to understand their stability and capability to deliver, ensuring we understand any that are at risk, and importantly identifies those that may need support from us.

Where SCMs have furloughed key staff, we work with them to provide support from our own management or by ensuring enough continuity of work to allow for staff to return to work. Tests will be carried out to ensure ability of services are not compromised with reduced staff numbers. GRAHAM have engaged in open dialogue with our SCMs to discuss impacts and agree pragmatic solutions to either party’s contractual obligations. Doing this has ensured continuity of delivery by our SCMs, maintained their cashflow, and continued delivery for our clients. We adopted this approach to provide certainty to our suppliers and retain strong future relationships.

On our NHS projects, we worked with other Tier 1 constructors to enable merchants and some other key suppliers to reopen. This also included dedicated NHS Construction Hot Lines set up for priority deliveries.  Members of the GRAHAM team were part of the Procure 22 Programme Management Office that supported NHSI/E in delivery of the Nightingale Hospitals. Specifically, Finlay Murray from GRAHAM, led the Procurement and Supply Chain Task Group. As a result, we have an extensive and detailed understanding of current supplier capability across the UK. Many of our suppliers were part of this exercise, providing valuable further insight and knowledge which will support delivery of projects for Clients.

The Procurement Team gathered valuable information on market source, quantity, availability, and future productivity outputs across industry suppliers enabling a thorough knowledge of capacity and capability of suppliers to support our projects.

The above demonstrates the robust nature of the GRAHAM response to COVID-19 and our commitment to maintaining the health and wellbeing of our workforce and SCMs. The robust measures taken support and ensure our capability to bid and deliver projects for our Clients in a productive and safe way.

ISG

During the COVID-19 crisis we have maintained payments to our supply chain partners in line with agreed payment terms and the fair payment charter. In some instances we have improved payment terms to support our partners and also maintain production and progress where necessary. This has been achieved through regular and ongoing dialogue with our partners to identify, and understand, pressures and constraints they may have and areas where we could make improvements together. By way of example:

M&E Contractor on one project – Have had to source materials from a wider range of wholesalers due to shortages of stock with their normal suppliers and have been asked to pay for materials up front due to no credit facilities at the alternative providers. ISG have stepped in and purchased materials on their behalf to maintain programme and assist with cashflow.

Partitioning Contractor on one project – an opportunity to catch some time up (due to COVID-19 ) was identified but required an increase in labour onsite whilst still maintaining social distancing measures. This created a problem for the contractor in question in so far as their labour is paid weekly and the increase in labour meant that they were paying out far more than anticipated, creating problems with their cash flow. We agreed to reduce their payment terms to 14 days, with fortnightly valuations to manage this issue with them.

In addition to this, we have also more recently supported our partitioning contractors across the region by bringing them together to understand the overall demand for plasterboards and bagged plaster finish etc . We were made aware of a potential issue with a major supplier, British Gypsum, suspending production so our supply chain team has worked with British Gypsum to maximise the allocation of materials across our sites and minimise disruption to the partitioning partners and the projects.

Coronavirus Project Action Plans

COVID 19 ISG Approach

Our Objectives

1. Comply with Gov & industry guidelines for social distancing

2. Ensure we keep people healthy and safe

3. Maximise productivity and minimise impact

4. Lead the industry in shaping the ‘new normal’

Challenges

Optimising safety, welfare and logistic on our projects

Avoid an over-reliance on PPE

Optimise travel arrangements for the workforce

Making the journey to the ‘new normal’ together with all stakeholders

Finding improvement, innovation and efficiencies

Supply chain solvency

Availability and flow of materials to site

Reducing / re-balancing the density of labour on site through more efficient working

Creating an environment where the workforce is motivated

ISG Business as usual

What we have learnt so far…..from our Supply Chain

Held supply chain forums with over 100 subcontractors

Listened to 25 in detail about their views, concerns and taken action

Used questionnaires to collect data focussed on trade specific challenges

Run ‘Teams’ workshops to review & share info and experiences

What we have learnt so far…..from our Own Business

Capturing programmes & resource data from our sites

Benchmarking pre & post COVID-19 site set-ups

Sharing learning across all UK construction regions

Supply chain data

Difficulty to achieve social distancing for main activities

Measures to be taken to meet guidelines

Pre & Post COVID-19 labour and production rates for key activities

Utilising off-site manufacture and DfMA

Fast construction that reduces site labour or material shortages and drives quality

Defects are minimised and quality control is high

Manufactured in factory controlled environment and tested

Assembled on-site to produce final outcome quickly reducing programme

Early testing and commissioning

How and to what extent will BIM help

Digital surveying validation of existing structure and site conditions using laser scanning (point cloud)

Collaboration platform shared information, clarity and informed decision making

Minimise waste through good design and modelling optimised component based approach and DfMA

Building services – MEP

Opportunities and Challenges

Incorporating sustainable energy solutions to provide a ‘green energy’ micro-grid solution

Ensuring that the scheme can be delivered safely. In a timely manner and within budget

Constructing a safe, welcoming space in a post Covid-19 world

Project Requirements

Early engagement with designers, specialists and stakeholders

Coordinators design and integration of sustainable energy technologies

Plan for testing and commissioning of the development from the outset

Ongoing management and maintenance requirements

Sustainability Opportunities – Lean, Clean & Green

(Post Covid-19 Design Considerations)

Tender Period

Time for dialogue

Programme method & logistics analysis and buy-in

Optimum design and specification / collective understanding

Protect the programme & reduce the risk

Pre-construction

Client, team and stakeholder interface

Summary

Site logistics & the size of welfare areas has become a key driver to the overall pace of construction

Logic, sequencing and greater efficiency will have a significant impact on programme and productivity levels

Our supply chain have reacted well & engaged positively & intelligently

Currently we are achieving 80-85% of planned resource across our UK projects with productivity close to 80%

Coordination & forward planning for all parties has become more important than ever – we must all find time to ensure this is done properly

Supply Chain COVID Survey produced

ISG Supply Chain Virtual Forum

SAFETY MOMENT – BEHAVIOURAL SAFETY IN THE WORLD OF SOCIAL DISTANCING Covid-19 Coronavirus

WE’RE SOCIALLY DISTANCING. ARE YOU?

Here are the four things we are doing on this site to protect from COVID-19:

Only coming to site if we can travel safely, avoiding highly populated public transport and maintaining a two-metre distance throughout our journeys

Not coming to site if we have a high temperature or dry cough, and self-isolating for 14 days

Remembering to keep a two-metre distance from others working on site

Washing our hands frequently for 20 seconds, covering coughs and sneezes and avoiding touching our faces

LOOKING BACK PHASE ONE FORUMS

Good feedback from you

Value to ISG and Supply Chain

Themes: moral issue / confidence, force majeure, payment / solvency, travel, pipeline / opportunities, health & safety (2mSD)

HOW WE HAVE MOVED IN TWO MONTHS…

20th March * UK prepares for lockdown, pubs, gyms, restaurants and other social venues to close

23rd March Lockdown begins * ISG pauses sites * Risk Assessment undertaken to ensure projects are safe to continue * Social distancing measures put in place on all projects

24th March CLC Version 1 issued * no non-essential work within 2m * ISG produce guidance to all projects to comply with CLC

31st March * Letter from The Rt Hon Alok Sharma MP thanking the industry for their efforts during this period

2nd April CLC Version 2 issued * SOP issued reinforcing no non-essential work within 2m (subsequently withdrawn within hours) * ISG commenced work on our COVID-19 Best Practice App to address issues

8th April * PHE guidance introduced the concept of hierarchy which permitted work within 2. * ISG updated guidance and introduced justification process

14th April CLC SOP Version 3 issued * Reinforced PHE guidance issued on 8th April

27th April * ISG produce and share COVID-19 Best Practice App Covid-19 Health & Safety App

11th May CLC Version 2 Issued * Public Health England guidance updated to reflect RPE, travel, face coverings etc

18th May CLC Version 4 issued * Reinforces the PHE Guidance * removes the additional requirement for face to face working 15 mins RPE clarified * ISG updated guidance and published on the COVID-19 Best Practice

SITE SAFE AND OPERATIONAL – NOW

Justification process ISG implemented a justification process to permit work within the 2m social distance zone.

Face covering v RPE.

Covid-19 app Real time Covid-19 information App which can be viewed on phones, ipads and laptops.

The forthcoming challenges HSE are receiving thousands of complaints a week that are being investigated. Testing regimes for those displaying symptoms.

Infrastructure and lesson learnt Created an environment where it is safe for those required to work on site. There have been some valuable lessons during this period! Visitors, RAMS, meetings, less is more.

PIPELINE AND OPPORTUNITIES

Secured work – Preferred – In tender – Target opportunity – Any risk of cancellation

HOW CAN YOU HELP AT TENDER STAGE?

Any other blockers – let us know?

Help us influence design and specification

Let us know where there may be trade / skills shortages

Keep us informed around price increase ?

Keep us informed around product availability

PROGRAMME AND PRODUCTIVITY

We asked you… What have you found? How else can we increase productivity and efficiency?

Importance of data capture

As-built analysis

Look back to pre-con / work winning

Manufacture / order / delivery delays

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