The legal landscape serves all facets and interests within the built-environment. The first Contractual Innovation Workshop took place in London during September 2016 to consider the topic of innovation the legal and commercial aspects of the built-environment.
2017 will see the Process Innovation Forum (PIF) exploring the key outcomes from this event.
The first workshop addressed two issues:
How digitally empowered processes can facilitate legal and contractual processes?
How to facilitate digitally empowered processes through legal and contractual mechanisms?
PIF explored whether innovation within the current legal and contractual frameworks can introduce stability, transparency, efficiency and proactive risk negotiation/management in order to add value rather than waste within the built-environment which it serves. The workshop boasted a list of invitees from some of the most innovative corners from within the built environment sector and included some influential disruptors from outside the industry. The group considered the role of digital technologies supporting contracts during design, construction and operation. We also investigated how the digital technologies can improve or reshape the contractual and legal processes and whether using current forms of contracts on digitally empowered projects is sufficient or, in reality, a new generation of contracts will be required.
Pre-workshop declarations
The workshop participants have declared the willingness to share openly the successes and failures within the small group environment and exchange ideas. All were invited to present clear point of view and listen actively, challenge and be challenged, participate with passion, contribute constructively and collaboratively, with humility and without hubris.
"open-innovation spirit"
In an open-innovation spirit be interactive, honest, transparent and share their energy amongst the peers.
Workshop Expectations
Before the workshop the participants had expressed their will to clearly identify the contractual challenges and inefficiencies (the “process pains”), but also to gain and agree a holistic picture of the current innovation happenings across the legal landscape (the “solutions”).
"identifying process pains and process innovations"
Others left with an appetite to dive a level deeper and begin agreement on a better and more comprehensive understanding of the innovation surrounding contractual solutions as well as the contractual aspects associated with digital innovation
The participants aimed to look at the opportunities for the contractual changes and how we can work together to better demonstrate how “BIM” and “digital” can assist with the likelihood and severity of construction disputes.
It was all about networking with people that are committed to solve the associated industry challenges and creating the action oriented intellectual space within the industry for the debate and the appetite for innovation.
For the PIF team the goals were:
[if !supportLists] [endif]Generating awareness
[if !supportLists] [endif]Creation of the work-groups and follow ups
[if !supportLists] [endif]Learn an obtain insight
[if !supportLists] [endif]Defining the “pains”
[if !supportLists] [endif]Identify the existing innovations
[if !supportLists] [endif]Define new innovations
Pain Points Discussed
Of course the group had to go through the cathartic process of denial and intellectual combat in order to identify the common areas which cause all pain from a process perspective – this process culminated in the following identifiable list of issues:
Inconsistency of the current contractual frameworks
Lack of legal frameworks for rapid data collaboration&exchange
Obscurity of Purpose
Disconnect between procedure and execution
Disconnect between construction, operation and asset quality/performance
Disconnect between commercial interests and project commercial stability client satisfaction
... but also:
Gap between those who write contract clauses-conditions and those that have to implement them
Absence of contractual provisions in most Standard Forms of Contracts that support BIM and digital adoption
Define methods and procedures that must be followed by all the stakeholders
Lawyers themselves do not utilise the technology available to them to assist with dispute resolution
Different level of involvement for the stakeholders
Lack of collaborative procurement methods
Lack of early supply chain involvement
Suppliers are not engaged with process
Value of forward-thinking legal assistants is not recognise
Discussions
At the Workshop the participants were divided into four teams to discuss the key issues (the Awesome, Amazing, Marvellous and Stupendous Team). The key findings of the teams were as follows:
1. Awesome Team (Led by Sarah Schutte)
Pains - There is a lack of clear goals and the environment is not a collaborative one. Processes are not transparent.
Vision/Ideas – Start with the end in mind, focus on collaborative environments. There is a need for flexibility and continuous improvement to extract best value.
2. Amazing Team (Led by Henry Fenby - Tailor)
Pains - Business models are not aligned. Contracts do not reflect the approach on the ground. Clients are not clearly defining wat they want.
Vision/Ideas – Integrated project teams need to be explored further, with project teams united. Align technical and commercial teams. Construction needs to look at other industries e.g. manufacturing and learn.
[if !supportLists]3. Marvellous Team (Led by Shaun Farrell)
Pains – Contracts are too adversarial and do not incentivize innovation – one party gains at the other’s benefit. There is also too much duplication across projects at key interfaces.
Visions/Ideas – Need contracts to encourage mutual pain/gain and incentivise innovation.
4. Stupendous Team (Led by Rob Driscoll)
Pains – Social factors are not given sufficient weight so are often ignored.
[if !supportLists] Visions/Ideas –The social context of construction needs to be better appreciated and value under a contract linked to social benefits and performance output.
Synopsis
Current contractual systems advance silos and two dimensional relationship records which fail to be implemented within the project structure.
Existing contracts and relevant insurance provisions are also unfit for advanced digital project delivery and do not support the benefits the digital technologies offer. This means that we are solving new problems using old tools maintaining a division between design, construction and operation.
Andrew Croft summarizing the workshop:
David Savage with his comments:
Next Steps
The next step is a set of opportunity labs to allow us to better understand the actual specific and measurable steps to be taken in order to introduce some of the ideas and turn them to opportunities. These will consider the following key areas:
[if !supportLists] [endif]ROBUST TENDERING INFO CHECKING AND VALIDATION; AND
[if !supportLists] [endif]PROCUREMENT TO BE: OBJECTIVE, TRANSPARENT, TRANSACTION MANAGEMENT;
[if !supportLists] [endif]RIGHT TIME SUPPLY CHAIN ENGAGEMENT (EARLY ENGAGEMENT);
[if !supportLists] [endif]COLLABORATIVE CONTRACTING;
[if !supportLists] [endif]INCENTIVISING INNOVATION (USE OF KPIS);
[if !supportLists] [endif]MUTUAL PAIN/GAIN;
[if !supportLists] [endif]RETHINKING BUSINESS MODELS AND APPROACH TO VALUE;
[if !supportLists] [endif]SOFTWARE INTEROPERABILITY;
[if !supportLists] [endif]LEARNING FROM OTHER INDUSTRIES;
[if !supportLists] [endif]OPTIMISE PROJECT OUTCOMES NOT ENTITY OUTCOMES.
Please let us know if you would like to be involved in taking these points forward.
Comments from Paul Wilkinson:
Workshop Attendees
Process Innovation Forum thanks the following attendees of the contractual and legal innovation workshop for their contributions: Rob Driscoll (Legal & Commercial Director at BESAGroup, @RobDriscoll_Law); Sarah Shutte (Solicitor-Advocate, MPD, Managing Director at Schutte Consulting Limited,@sarahschutte1); Andrew Croft (Associate at Beale & Company Solicitors LLP, @andrewiancroft); David Savage (Head of Construction & Infrastructure at Charles Russell Speechlys LLP); Paul Wilkinson (Technology, PR and Marketing Consultant at EEPaul, @EEPaul); Maggie Brown (Innovation Manager at EDF Energy NNB); John Lohan (Partner at Integrated Project Delivery LLP, @Jflohan); Henry Fenby-Taylor (BIM Implementation Manager at WYG Group, @spudule); Shaun Farrell (Associate Director at Turner & Townsend, @ShaunF1969); DJ Gibbs (BIM Advisory and Dispute Resolution, Hill International); Franco Pittoni (Director at FP Opera); Alain Waha (Global Head of BIM & Digital at Buro Happold, @AlainWanderings); Chris Newman (Project Manager and Business Operations Consultant at Digital Technology Start-up); Mike Moseley ( Knowledge Transfer Manager at Knowledge Transfer Network, @KTNUK_BuiltEnv, @mike_moseley); Bruce Mclelland (Urban Living Specialist at Knowledge Transfer Network, @KTNUK_BuiltEnv, @Bruce_McLelland); Jakub Wachocki (Digital Strategies Advisor at Bentley Systems, @JakubWachocki); Thomas Linder (BIM Consultant at PCSG); and Lukasz Adamik (Solution Specialist at Microdesk, @_LukaszAdamik.)
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Authors of the post: Rob Driscoll, Andrew Croft, Lukasz Adamik
Organised by Thomas Lindner, Jakub Wachocki
Chaired by Lukasz Adamik
Facilitated by Mike Moseley (KTN/Innovate UK)
Hosted by KTN/Innovate UK