Performance Improvement in the Private Sector
Arup supported Heathrow Airport in translating regulatory requirements into a robust, digitally enabled capital control framework, embedding governance, reporting and assurance across the end-to-end lifecycle of capital projects and programmes.
When the Civil Aviation Authority introduced new regulations requiring Heathrow Airport to change how it manages and reports on its capital portfolio during the H7 regulatory period, the result was that capital projects must now define scope, quality, cost and duration through Delivery Obligations (DOs), agreed with airlines before business cases are approved. Project outturns face a penalty of up to 25% of the project’s value for non‑compliance, significantly increasing Heathrow’s financial risk.
With approximately £1 billion spent annually on capital investments, the airport required a comprehensive review of end‑to‑end systems, processes and people to ensure governance remained robust under the new regulatory model.
Arup supported Heathrow in managing end‑to‑end governance and embedded processes for DOs and ex‑ante, working with project managers to integrate and implement the new approach.
Ensuring risks could be identified early and delays to airline approvals avoided, Arup covered almost 300 capital project engagements and secured airline agreements on DOs covering nearly £1 billion in investment. Over 92% of live projects above £1 million now have DOs in place, and Heathrow now operates a self‑sustaining, digitally enabled, regulator‑ready, capital control framework.
A global aviation hub handling over 84 million passengers a year, Heathrow continually invests in capital projects to maximise efficiency, resilience and enhance the passenger experience. Arup, leveraging four decades of partnership with Heathrow, mobilised a team of 11 consultants to embed DOs across the lifecycle of capital projects through three integrated workstreams: DO production and change control; performance reporting and digitisation; and transition to a Heathrow‑led team.
Arup established strong foundations including robust document management, clear internal ways of working, centralised delivery functions and strong reporting that created a single source of truth for all projects. A Method Guidance document captured key processes and best practices. Arup oversaw outline, final and change DOs and embedded targeted improvements including revised change control, enhanced data analysis, digital standardisation and strengthened project close‑out assurance.
Engaged two months before going live, Arup rapidly mobilised a new team to build a process that could be standardised and scaled across six capital programmes. Through comprehensive monthly reporting, we provided a consistent view of performance and allowed early identification of risks to DO achievement. The work protected over £200 million in value across Heathrow’s £4 billion+ capital plan.
Arup transitioned Heathrow from a trial Excel‑based DO process to a fully digitalised, automated system integrated with the project management system. A phased handover to Heathrow included recruitment, training and capability building across senior leaders, project teams and partners and engagement with airlines ensured DOs were prepared, reviewed and signed off efficiently.
Heathrow now operates a regulator‑ready control framework applied to all capital projects, with strengthened governance, assurance and confidence for future investment.
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