With 26 department stores and 138 supermarkets to look after, John Lewis' building and services division rarely rests and the team is to get busier still.
The retailer is gearing up for a major development programme, and the way the construction team does business is about to change radically. At the helm of the programme is a man who helped change British construction.
Nigel Keen, director of building and services at John Lewis, is in charge of its development programme for both its department stories and the supermarket chain Waitrose. A former member of the Construction Round Table, Keen helped Sir John Egan formulate the ideas in Rethinking Construction. He describes his role as having helped "galvanise other people's thoughts".
Keen was then construction director for supermarket giant Tesco's £400m-a-year development programme, where his task was to introduce the idea of select lists of contractors.
After a decade with Tesco, Keen moved to John Lewis, and for the past two years has been reviewing the retailer's procurement methods. Keen is determined to abandon competitive tendering in favour of long-term partnerships with two or three main contractors, which will become construction managers, one set for Waitrose and another set for the department stores.
John Lewis already has a decade-long relationship with contractor Bovis Lend Lease and has said that it is looking to work with the company as one of its main contractors for department stores. Keen is tight-lipped about which other contractors may also be appointed.
The candidates could include Sir Robert McAlpine, Wates Construction and Geoffrey Osborne, which have all worked closely with John Lewis in the past. John Lewis has already chosen its partners for Waitrose, which will be revealed soon.
Keen says candidates will have to prove that safety, training and quality workmanship are constant concerns. The company will also have to be able to look inwards, which, he says, is "something not enough contractors do".
John Lewis can cherry-pick the contractors it wants because as a client it is liked and respected. Scott Lawrie, associate director at John McAslan Architects, which designed the restoration of Peter Jones, says: "You can show them ideas and not be worried about the kind of reaction they might have." Scott praises the retailer for its open-minded approach to business and the accessibility of the decision-makers. "On the design side you work directly with John Lewis, so you can get to the board members more easily," he says.
For Bovis Lend Lease, the distinguishing feature of the retailer is that it has an understanding of the complexity of the jobs it undertakes and is realistic about how that job will be achieved. John Lewis is "a powerhouse of ideas – it may sound dramatic to say so, but it is true," says a Bovis Lend Lease spokesperson.
Keen is convinced that Rethinking Construction has already had an impact. "Egan's report has made people realise there is a different way of working. It was designed to make people stop and think and from this perspective it is a success. Our industry is starting to change," he says.
Keen is particularly curious to see how the changes in the government's administration of construction will affect the future development of the industry. "Nick Raynsford was good news for us," he reminisces.
We have established relationships with our contractors and consultants. Very few contractors look within their businesses to better collaborate with their client
Keen is optimistic about the future of the industry and continues to push for change beyond the offices of John Lewis. He sits on the board of the Design and Build Foundation, and is looking to join a body that represents clients – "one that gives the best value," he says.
Who are the key decision makers?
There are three. Luke Mayhew, director of trading, David Felwick, director of Waitrose, and myself. All major decisions have to be cleared by the central board.
What investments are planned for stores?
We are planning to refurbish 20 of our 26 department stores over the next eight years. The older stores will be brought in line with the newer ones in Bainbridge, North Yorkshire, Bluewater in Kent and Peter Jones, Sloane Square, London. The department spends £300m a year, which will increase by around £20-25m a year after 2001.
What's a typical project like?
Generally, they have to fit into an urban environment and cover around 300,000 ft2. For Peter Jones, a great deal had to be done to improve the building's infrastructure before we could begin the fit-out. The main thing is that customers must not feel a store has changed too much.
Has your procurement policy changed?
We are trying to make the business more commercial. Over the past year we have tried to map our supply chain to work out who we want to work with and how they provide value. Our main contractors will work as our construction managers but, depending on the type of project, our specialist contractors and designers will be contracted to work for us. We have started the process on Waitrose.
For the department stores, we are working strategically with Bovis Lend Lease and might look for two other contractors. There has to be a cultural fit and the supplier has to show that it is interested in constantly improving its service.
Part of our judgment will be made using key performance indicators, which we are developing with our contractors' help. We will also regularly review the companies' training and employment records.
How has John Lewis changed as a client?
The way we design and manufacture our shop fittings is changing. They used to be designed to last 30 years and were expensive to pull out. We saved 10% on the standard fit on our Waitrose stores last year, and we want to save another 10% this year. About 7% was saved on our department stores this year and we aim to save another 10% next year. We will continue with our policy of whole-life costing.
What is John Lewis' reputation as a client?
I think we are trusted, and people enjoy working with us. Perhaps we have been seen as not commercial – but that is changing.
How easy is it to get work with you?
Very difficult. We have established relationships with our contractors and consultants. Very few contractors look within their businesses to better collaborate with their client.
