John Rackstraw, chief executive of Pearce Group and a devotee of the Egan message, explains how he’s putting the principles of partnering and integrated supply chains into action
John Rackstraw, chief executive of Bristol-based contractor Pearce Group doesn’t like the term “partnering”.
He thinks the word is too simplistic for conveying the Egan principles of integrated teamwork – and how hard it can be to apply those principles on the ground. He should know.
As head of Pearce since 1996 Rackstraw, 58, has worked in partnering style agreements with key clients including retailer Asda. It’s a style that defines most of Pearce’s client relationships. To name just a few, the £183m turnover company is a principal contractor for leisure groups Whitbread, Rank and Cannons. Pearce is also one of five principal supply chain partners, known collectively as Medicor, for the NHS Procure21 pilot scheme in the North-west. And the company partners on public sector education projects.
Nearly two years on from its management buyout from Crest Nicholson, Rackstraw says Pearce is still consolidating its business in its new guise as a limited company. He’s trying to reduce Pearce’s supply chains even further and squeeze out waste further down the chain.
So what does partnering mean to Rackstraw? “I prefer to talk about collaboration and co-operation. It’s about choosing a supply team that can sit down, with the client, at the very start of a project and together agree on what the objective is and the route that will be taken to achieve it. You’ve then got to measure the performance of the team and constantly review its progress so that when it comes to the next project the same team has measurements to improve upon,” he says.
Faced with the uncertainty of traditional procurement, why aren’t more clients demanding a partnering approach – and why do some contractors find it hard to apply in practice? Rackstraw’s answer is simple – because it is very hard work to successfully partner. He says, “Collaborative working takes a lot of time. The approach needs careful planning and effective supply chain management at the outset.” Another factor is that when things go wrong, some companies revert to type and call in the lawyers. The key is to solve problems quickly: “With a truly integrated supply chain, a problem should be dealt with as if it’s your own, even though you may not have been responsible for creating it in the first place.”
With a truly integrated supply chain, a problem should be dealt with as if it’s your own, even if you didn't create it
On the whole, Rackstraw is positive about the industry’s prospects saying the industry manages to do a fantastic job in “ropey” conditions, namely a lack of skilled labour. He is, however, concerned that the industry is too fragmented. “Our suppliers in turn subcontract, and so on and so on, until you’re looking at the sole traders and small companies that make up most of the industry. It’s not obvious how we should tackle this problem; the industry is too easy to join.”
But Rackstraw is determined that Pearce should do its bit to make the system work better, particularly when it comes to training. For example, Pearce operates a stringent supplier audit, which is reassessed regularly:
“An integral part of this audit is their training policy and appropriate levels of investment. Visits to our suppliers’ offices are again routinely undertaken to ascertain whether they are ‘walking the talk’. We continue to second Pearce staff to relevant suppliers organisations to share best practice and have contributed on occasions to specific training costs – in particular, IT training.”
Another aspect of the company’s commitment to training involves working with CITB-ConstructionSkills: sharing its training plans and seeking support to structure and finance its training strategy. Above all, Rackstraw believes that the key to solving the skills shortage is for construction firms work together: “We believe that all players in the industry share a responsibility to promote construction as a career and highlight the rewards and opportunities that are available. We must all work to create more certainty in future workstreams to encourage the supply chain to invest in recruitment, training and development.”
Whatever the problems and challenges faced by the construction industry, Rackstraw is passionate that partnering or collaborative arrangements – call it what you will – when put into action reaps rewards.
CITB Supplement 2004
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