BT's Gary Wingrove: Your call is important to us

Gary Wingrove never wanted to be an astronaut or a fighter pilot when he was growing up. For him, there was never any doubt that he would work in construction. The son of a tiler, his experience of life on site started early: “As far back as I can remember, the building trade was part of my life,” he says. “I used to jump in the van on a Saturday and go down on site and play around. I hope I won’t get shot by the health and safety police for that,” he laughs. “But I always knew this was the career I wanted.”

Wingrove spent his early career working as a QS for “contractors of various sizes”. He made the leap to the client side of the industry ten years ago, becoming head of construction programme management at BT.

He plays a major role in cutting BT’s £900m annual property spend by about 12% a year - something he knows he can achieve only by toughening up its procurement system and demanding greater value for money from the supply chain. This means BT is to become the latest major client to emulate BAA by moving away from frameworks. This, Wingrove points out, will offer opportunities for anyone not already on one of its frameworks or pre-approved lists.

Change in procurement

Since joining BT full-time in April 2009, Wingrove’s hardest task has been to oversee the delivery and management of the firm’s development pipeline across 170 countries - while simultaneously cutting annual construction spend. “Property spend is around £900m a year,” he says. “There is pressure on us to reduce costs by 10-12% each year. With a property spend of about £1bn, that’s a significant amount of money.” To achieve this saving, Wingrove is joining BAA, the ministries of defence and justice, the Highways Agency and others by rethinking procurement.

“Historically, BT has had a set-up where the supply chain is tied up on frameworks and [there is] another national panel of other firms who have all been pre-approved - so there is still limited competition,” he says.

“Now we are trying to move away from using the frameworks. They were set up at a time when there was quite a lot of work around and they worked in that context. But in the current market, they don’t give us best value.”

Over the next 12 months, Wingrove will be bringing in new firms to “widen BT’s field of vision”. He hopes the move away from frameworks will be seen by the industry as a positive development, but there will be no formal change to the system à la BAA. At the airports operator, all projects worth more than £25m are sent out to tender. BT’s strategy will be more subtle.

“This won’t be a wholesale back to the market, open season,” he says. “But there will certainly be opportunities. We are taking a long, hard look at our supply chain and we want to fill some gaps.

“So it will be a case of looking at things on a project-by-project basis and saying:

‘We don’t have enough London fit-out contractors. We want some on there to get some better value so let’s stick two or three on the list who don’t currently work for us.’”

No more Mr Nice Guy

Wingrove insists the industry at large and BT’s existing supply chain should not see the move away from frameworks as adversarial. But he does think the time has come to toughen up. “We like to create long-term relationships with a supply chain, but you need to freshen things up,” he says. “BT are considered nice people to work for. Some people might say we have been too nice, particularly in the current market. I think we are being harder now by planning to review our tender list on a project-by-project basis, rather than assuming we’re going to use the pre-approved contractors and consultants.”

What about the reaction from the current incumbents? Wingrove has a short, sharp answer: “Under their current contracts, they have no right to any work whatsoever and we have every right to bring in whoever we like. I hope our incumbent supply chain will rise to the challenge.”

Even if the companies do this, winning work with BT will not be a walk in the park. Quite apart from the fact that, like any good client, Wingrove is looking for the best of the best, the work available will be limited over the next year or two at least, and competition will be fierce.

“We had hoped the budget reins would be let off slightly since last year as BT’s results were good but, probably quite rightly, the pressure has been kept on us to reduce costs further. As a result, work will be driven by necessity. We are looking to rationalise in the UK and there is a programme rationalising office space in the US, Far East and China. The other piece of work we have running at the moment involves rationalising our data centre portfolio.”

Budgets won’t always be so tight, however, and Wingrove is keen to get new firms on board in time for a period of increased spend: “We have a large property portfolio and the time will come when we have to spend more money as the buildings will start to let us down. We’re making them work harder at the moment - putting more people into fewer buildings - so we’ll have to upgrade them.”

So what does he want from potential supply chain members? Innovation and money-saving ideas are near the top of the list: “It’s not as if we’re looking for just interior designers or a particular M&E contractor,” he says. “It’s the style. We’re looking for people who have a bit of original thinking who, on top of giving us a good price for the job, can bring some extra value along because of past experience. We want people who can think on our behalf rather than just taking instructions.”

He also says he would not be averse to adopting another BAA method - incentivising money-saving ideas with a financial pay-off. “At the moment margins for contractors are very tight so I don’t see why we couldn’t say: ’We’ve done the initial design, we’ve priced it, we could do with shaving some money off and we’ve run out of ideas. If you can come up with any, there is a share in it for you.’”