Southern Water AMP67
In February 2018, Arcadis was engaged by Southern Water (SW) to deliver a commercial and procurement transformation for its construction and maintenance supply-chain. The remit was to work collaboratively with SW to secure >20% efficiencies against a £multi-bn programme, and remedy legacy supply chain relationship and ways of working issues. The expectation was to bring cross-sector insights, best practice, and innovation to resolve challenges being experienced, and implement the solution before 2020.
We segmented capital and operational investment programmes by work type, complexity, and geography, enabling us to align sub-programmes with the best supply–chain arrangements to deliver efficiently. We developed and implemented the procurement strategy for these work packages and created a new commercial operating–model and incentivisation mechanism to run new contracts. To embed new ways of working, behavioural change, and continuous improvement, we underpinned this with a new Supplier Relationship Management (SRM) framework, co-created through supplier participation to meet both client and supplier needs.
We secured contractual commitment with 6 industry leading contractors (3 Design and Build and 3 Repair and Maintenance JV’s). This combined with other efficiency enablers we developed will deliver the savings required, as signed off by the Board. An innovative change leadership technique we introduced was creating a board game, the “Southern Water Way” which articulates how the new model works, including behaviours desired.
This transformation is key to realising SW’s vision to ‘create a resilient water future for customers in the South East’, with cost savings also preventing an increase to customer bills.