Five pilots of a new partnering contract were launched this week. Will they spread the use of open, trusting relationships among project teams?

Partnering has been heralded as the panacea for construction’s adversarial culture. A key recommendation of Sir Michael Latham’s report in 1994 and Sir John Egan’s in 1998, it was meant to create a brave new culture of teamworking, trust and mutual co-operation between clients, contractors and subcontractors. The idea is that all parties collaborate from day one to cut costs and build times.

Few can argue with the principles of partnering – they are common sense, and most firms say they have been doing it for years. It also has the backing of major clients and government. The Construction Clients Forum, whose members commission 80% of UK projects by value, said in its 1998 manifesto that adherence to the language of partnering was a prerequisite to qualifying for the £40bn of work that its members let every year. The principles of partnering are also enshrined in Treasury guidance for public sector procurement through its best-value regime.

The Movement for Innovation, the body set up to implement the Egan reforms, has also got in on the act. It announced a partnering contract called Trust and Money last year and unveiled five pilots projects that will use it at this week’s Egan conference. Trust and Money is a multiparty contract with the client in which key people from the project team are seconded to a virtual company to design, build, maintain or operate a building in partnership with the client’s representatives. It will be followed in June by guidance on partnering from the Construction Industry Council.

But is the mantra filtering down from the top and producing real benefits for clients and contractors on the ground? And are firms doing it properly or merely paying lip-service?

Many clients and contractors bandy around partnering buzzwords, but fewer are committing resources to it. Paul Morrell, senior partner of QS Davis Langdon & Everest, says partnering firms have to prove that they are adding value: “If you are going to come to the table early, you represent a cost, so you have to have a way of repaying it by adding value preconstruction, through input to design and understanding of the client’s purpose.“

There is a feeling that many contractors adopt the term to win work and then fail to offer any real benefits. “Some contractors see partnering as an escape from the chill wind of competition. They don’t have to compete so fiercely, and put in worse and worse people who are not accumulating the skills to operate in the new environment,” says Morrell.

Colin Harding, chairman of Bournemouth-based contractor George & Harding, says this problem runs down the supply chain. “Our problem is finding subcontractors to partner with. They want jobs on a plate and to add 10%. But they don’t want to talk about serious open-book accounting and real partnering,” he says.

The relatively secure nature of partnering arrangements can discourage firms from striving towards continuous improvement, says architect Michael Manser, chairman of Manser Associates. “Setting up long-term agreements means the client may get the B team while the A team is being deployed on more interesting projects. A captive customer is not necessarily a well-served one.”

Another concern about partnering is the uncompromising, evangelistic language of official guidance, which implies that not using it is unprogressive. Morrell says: “What is wrong with a client simply making up its mind what it wants and putting a clear statement out to the construction marketplace? The only problem with it in the past arose when the client changed its mind.”

Many believe that partnering is unsuitable for small clients. Richard Steer, senior partner in Gleeds, says: “Partnering involves a huge throughput of work to keep the same teams together for the duration of framework contracts, and hardly any clients can generate it or pay the fees. Also, you only achieve savings if you have enough work to push through to all the subcontractors.”

Manser highlights one of the fears that consultants have of partnering relationships. He says they downgrade consultants’ services because the ethos of value engineering the supply chain does not distinguish between the provision of intellectual services and the subcontracting of products.

Despite these fears about partnering, there is overwhelming support for it when practised properly. “When it is implemented by good people, it achieves good results,“ says Stuart Green, professor of construction management at Reading University. He adds: “Partnering that is used in a cynical and exploitative way by people rooted in the old adversarial culture of construction does not achieve these results. A fool with a tool is still a fool.”

The key to successful partnering seems to be largely in the execution. Architect John Wright, chair of the CIC’s partnering taskforce, says it is not being practised properly because of “massive confusion” about what is involved. It is this that provided the impetus for its guidance on project team partnering to be published in June. Wright says: “Partnering contracts should be tendered on a commitment to understanding the integrated design and construction process, having the training for it and being able to demonstrate that. Hardly anyone is doing it properly yet.”

The evidence is that he is right. Richard Saxon, chairman of multidisciplinary firm Building Design Partnership, says: “Both main and specialist contractors need to rev up their abilities via recruitment and training. And good facilitators are needed to coax inarticulate and inexperienced people.”

Contractors that have taken the plunge and embraced partnering, such as Kier, Mansell, Bovis and Balfour Beatty, have seen it pay off. Their investment in recruitment, researching integrated design, IT for supply-chain management, and management training have led to partnering contracts that have dramatically increased turnover.

These firms have achieved strategic partnering, working on sequential projects for the same client. This is what MEPC director Kevin Monaghan calls “partnering for improvement” as distinct from project-specific “partnering for comfort”, which too much of the industry is limiting its efforts to. But, says Monaghan, partnering alone was never a panacea. “The targets for savings set by Egan were real – certainly 20%, possibly 30%, is achievable. But partnering isn’t going to deliver it. Partnering is only part of the equation. Only when it comes together with investment in IT and a greater level of skill across all areas of the industry from the bottom to the top will those targets be widely met.”

Partnering: The nine commandments

1 Share objectives between client and project team 2 Set down individuals’ responsibilities at the outset and make them known to the rest of the team 3Commit to continuous improvement and monitor progress using key performance indicators 4 Have common procedures for resolving problems and allocate dispute mediator role 5 Allocate risk clearly among the team 6 Set out incentive/penalty arrangements 7 Try to solve disputes through senior management before resorting to a dispute resolution procedure 8 Use open-book accounting 9 Streamline supply-chain management

What do the experts say?

Contractors are in favour of partnering, but professionals are sceptical. They think it is a threat to their livelihood Colin Busby, chairman and chief executive, Kier There are very few contractors that have a real capability to transfer knowledge from one job to another Peter Rogers, director, Stanhope The message gets diluted as you get more work and the team expands. You have to work really hard to speak with one voice Kevin Monaghan, director, MEPC The real gain is in not having to relearn the attitudes, qualities, focus and direction in which a client is going. They have us without a learning curve every time, so they get cost savings every time: improvements in their bottom line Martin Scarth, director, Kier Group We are passing on savings to clients through better design, life-cycle costings and a 12-year maintenance period. And clients are being more open with us Pete Harris, business development manager, Russell Construction Despite the rhetoric of trust and teamworking, there is inequality in partnering agreements Stuart Green, professor of construction management, Reading University