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Consulting Matters
CONTENTS
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12 Delivering a customer collaborative culture
14 Know thyself – looking inward then growing outward
SMEC Case Study:
U2 on Waymouth, Adelaide
Industry updates Industry updates
Protecting your business 2
What’s happening in Consult Australia
Run off cover and retirement strategies for professionals
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Business essentials
From the President
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From the CEO
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Consult Australia appointments
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Introducing ConsultHR
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State Division updates
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Economic Forecast September quarter
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Project case studies U2 on Waymouth, Adelaide
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Industry comment
Features Delivering a customer collaborative culture
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Know thyself – looking inward then growing outward
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The real value is in the relationship
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Introducing Arcadis
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Registration the answer to winning new business
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Not a member of Consult Australia? To find out more about how your firm can benefit from membership contact Consult Australia’s Business Development Manager, Jennifer Kelly on (02) 8252 6712 or email membership@consultaustralia.com.au www.consultaustralia.com.au
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Consulting Matters
Industry updates
Industry updates Almost a year after being acquired by global consulting firm Arcadis, Hyder Consulting has rebranded as Arcadis with effect from 21 September. Other additions to the Arcadis stable over the past few years such as EC Harris, RTKL, Callison and Langdon Seah will also be making the change.
Golder Associates has recently undergone a global restructure which has seen the appointment of Hannah Hamling as President Asia Pacific and Africa. Hannah is based in Auckland and was previously Managing Director of Golder New Zealand. The restructure follows the appointment of Dr Hisham Mahmoud as President and CEO of Golder in April this year.
Calibre Consulting has expanded its capability and services in South East Queensland with the acquisition of engineering and transport consulting firm, Newell Pty Ltd (“Newell”). Newell is a Gold Coast based consultancy specialising in the delivery of public infrastructure projects with a focus on the planning and design of road infrastructure. The consultancy also provides public utility services planning and design; road safety services and traffic analysis and transport planning. Newell will transition to the Calibre Consulting brand over the coming months.
Calibre Group has announced the appointment of Max Bomben (left) as Managing Director of its consulting business, Calibre Consulting. Prior to his appointment Max was the Executive General Manager of the NSW and ACT businesses where he has contributed significantly to the planning and strategic growth of the company since 1993. The decision to appoint Max came after a broad internal and market search.
Patrick Hill has been appointed Group VicePresident of Jacobs’ Australian and New Zealand Infrastructure and Environment business. Previously Mr Hill headed Jacobs’ North American Telecommunications division based in Chicago. He joined Jacobs through the acquisition of Sinclair Knight Merz (SKM)
where he headed SKM’s global Power and Energy Business Unit.
SMEC has recently appointed Peter Rundle (left) to the role of Director of OperationsInternational. In this new role, Peter will be responsible for driving SMEC’s compliance and governance program and reducing the Company’s working capital. Peter joined SMEC in July 2014 as Chief Operating Officer South Asia Middle East (SAME), and has been instrumental in realigning the SAME business and positioning the division for future growth. Peter’s 35 years’ experience in infrastructure, transportation, mining and building project management, coupled with commercial acumen and postgraduate business qualifications, make him the ideal candidate for this challenging role. Peter will continue to remain a member of SMEC’s Executive Committee (EC).
pitt&sherry’s longserving Managing Director, John Pitt (left), will retire in September. John has over the past 30 years grown pitt&sherry from a small northern Tasmanian civil engineering consultancy to a multi-facetted group operating across the eastern States of Australia and internationally. Paul Hardy, who was recently appointed as NonExecutive Director, will become Chairman of the Board, while Dan O’Toole will take over the reins as CEO. In these appointments the Board of pitt&sherry is confident that it has two high-calibre leaders ready to take forward the outstanding contribution made by John, and ensure the ongoing development and growth of the company. We wish John all the best in retirement.
George Lasek (left) has been appointed to the role of Chief Operating Officer South Asia Middle East (SAME) for SMEC. George has held the role of Regional Manager India
and Bhutan, as well as Managing Director SMEC India, for the last two and a half years. George has over 30 years’ experience in the private and public sectors, and has a proven ability to operate effectively at both an operational and strategic level within large, complex business environments.
SMEC has appointed Karen Atkinson (left) to the role of Regional Manager North Asia-Philippines (NAP). Karen offers key skills in: business unit leadership and management; strategic planning and marketing; client service management; and project and design management. Based in SMEC’s Hong Kong office, Karen will be responsible for business performance across all sectors in the NAP region (currently comprised of Hong Kong, Mongolia, Macau and the Philippines). This will include providing leadership, coordination and strategic direction for activities throughout the region, and collaboration with the wider SMEC business.
In a move to reshape the company to better serve its clients to compete in the digital age, Giam Swiegers, Chief Executive Officer, is making some strategic changes at Aurecon with the appointment of John McGuire (left) as Chief Innovation Officer. Reporting directly to Swiegers, McGuire will drive the change to embed a global culture of innovation within Aurecon. He will also lead the organisation to achieve its goal of partnering with clients to design their future, determine their reactions to a variety of different competitive situations, and discover innovative pathways to thrive in the age of digital transformation.
Dr Kourosh Kayvani has been appointed Global Director, Excellence and Expertise at Aurecon. Reporting directly to CEO Giam Swiegers, Dr Kayvani will play a pivotal role in mobilising Aurecon’s global pool of leading experts to focus their cultivated skills, deep insight and professional passion squarely towards solving the critical and complex problems the clients need solved.
Industry updates
He a Laureate of the IABSE Prize awarded by the International Association for Bridge and Structural Engineering and a Fellow of Institution of Engineers, Australia, an Honorary Professor at the University of Sydney, a Visiting Professorial Fellow at UNSW, and a Director of Australian Steel Institute.
Phil Kajewski (right) has been appointed as the new Managing Director for Infrastructure for Arcadis Australia Pacific. Phil was previously the Chief Operating Officer for the firm and has 30 years' experience in the delivery of major infrastructure projects, including design management, project management and contract administration.
WSP | Parsons Brinkerhoff congratulate Building Services specialist Dan Cunningham on his recent appointment as Regional Director for the Australian Capital Territory. An internal appointee, Dan has been with the firm since 2001 and has been Canberra-based since 2009. Managing Director for Property, Environment and Resources, Andrew Mather, said the company’s growth in the ACT required a senior leader on the ground in Canberra to manage sustained and strategic growth.
Rowan Peck, formerly with NDY, has started new firm Mission Critical Systems where he will focus on engineering practical, reliable power systems for clients in sectors including data centres, hospitals, quality buildings, and industrial. Rowan remains based in Canberra. See www.mission-critical.com.au for more information and contact details.
Kevin Harney (left) has been appointed to the position of Regional Functional ManagerResources for Northern and Central Australia at SMEC. Kevin has over 37 years’ project experience in general management, production management, business development and metallurgical consulting including operational and commissioning support services.
The Australian Institute of Architects has announced that David Parken has decided to step down as CEO of the Institute. In making this announcement National President Jon Clements acknowledged the significant contribution Mr Parken has made to the organisation, the profession and the broader construction industry during his ten year tenure. ‘National Council is very appreciative of the tireless efforts and support David has given to Council, staff and members through his service to the Institute,’ Mr Clements said. Mr Parken will continue in his current role at the Institute supporting the National Council while they develop a transitional plan for the appointment of a new CEO.
Consulting Matters
Editor Kisanne Dulin
President Matthew Harris
Chief Executive Officer Megan Motto
WSP | Parsons Brinckerhoff has announced the appointment of Charlie Jewkes to the role of Director of Transport for Australia and New Zealand. Jewkes joined the firm as Section Executive for Geotechnical and Tunnelling in 2006 and has been appointed to several key management roles since then and has held leadership roles on some of Australia and New Zealand’s largest infrastructure projects.
Director – Policy & Government Relations Jonathan Cartledge
Director – Marketing & Membership Kisanne Dulin
Senior Advisor, Policy & Government Relations Robin Schuck
Business Development Manager
Tony Barry (left) of Aurecon has been elected as a Director to the Board of FIDIC (International Federation of Consulting Engineers). In a close contest, the General Assembly Meeting elected him to one of only two open Board positions.
Richard Kelly (left) has recently been appointed to the role of Chief Technical Principal (CTP) Geotechnics at SMEC. Richard has previously held positions as a consulting geotechnical and structural engineer, as well as a research academic in geotechnical engineering. Richard will be based in SMEC’s Brisbane office, and will be responsible for providing expert geotechnics advice and support across the business.
Jennifer Kelly
Manager – Events & Education Dio Connelly
Corporate Designer Voltaire Corpuz
Editorial submissions kisanne@consultaustralia.com.au
Advertising enquiries info@consultaustralia.com.au Consulting Matters is produced by Consult Australia. Phone: (02) 9922 4711. Website: www.consultaustralia.com.au
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Consulting Matters
What’s happening at Consult Australia
From the President country and that our policy setting therefore needs to support innovation and prosperity. To that end, it is to be hoped that Prime Minister Turnbull’s appointment of a Minister for Cities and the Built Environment signals the start of a fresh new vision that will deliver great outcomes for our country and its people. Consult Australia has taken the lead in its support for the creation of this key Ministry through ongoing lobbying of Government for the establishment of a portfolio that not only supports collaboration across states and territories, but also identifies the critical role our cities play in driving productivity and business growth. This has been one of our key priorities and advocacy strategies for a number of years and is a clearly demonstrates the relevance of Consult Australia to our sector.
Given recent events, I consider myself very lucky to be the President of Consult Australia— there have been no boardroom coups, there have been no votes of noconfidence, there have been no spills, no leadership ballots and I have been able to serve my full term as both your President and Chair of our organisation. Who would be a politician? We are in a time when just doing business in Australia, let alone building new business, can be a fragile exercise. With business confidence having dropped recently, particularly across a number of our very own sectors (mining, transport and engineering), political stability across our nation is crucial for growth. Stability means a predictable environment, which in turn attracts investment both internally and externally, job creation, increased state revenues and poverty reduction. A case in point is the current stability being felt across New South Wales, with a reelected government, a Premier who is not only supported by his Party but also by the people, both inside and outside of his State, we are seeing the current level of business confidence outpace other States— in fact it has leapt to its highest level in over a year. Whilst we have every reason to be positive, it is important to acknowledge the role that our leaders play in shaping the vision for our
This initiative is one of many that I have been proud to be associated with during my time as President and clearly defines the true strength of our organisation in its ability to lobby and produce an outcome that will clearly benefit our profession as a whole. As I end my term as President, there have been many occasions when I have thought how lucky we are to have an industry body that truly represents all of our interests, across the broad spectrum of industries that our companies represent. Yes, there are many organisations that represent our personal interests, offer us professional development opportunities or certification, but to me, the Consult Australia difference is best demonstrated through its ability to reach into Government, whether Federal, State or Territory, and effect change; it has been the ability of Consult Australia to represent our professions on an international stage, whether in Japan, Brazil, UAE or the UK where we are considered leaders; and it has been the leadership we have shown on social matters, including championing diversity and inclusion. It is of course only with your ongoing support that we are able to continue to address these issues, they affect us all and as a united voice we have a greater opportunity to continue to affect change. I continue to be impressed by the impact that our Champions of Change is having, and whilst our Charter has been re-drafted, honest conversations about each of our company’s performance continue. In the two years I have been your President I am pleased to say that there has been some real action in this area, with each of the
signatories using the Champions of Change platform as a unique opportunity to bring about change within their own organisations. This was highlighted at the recent Male Champions of Change Leadership Forum, hosted by Elizabeth Broderick, where our program was acknowledged in front of over 800 attendees, including CEOs from the most influential companies across Australia. Our very own Consult Australia Champions of Change were also recognised, along with the founding Champions, as one of only six (6) other groups recognised across Australia as a Sector Specific MCC Group. For Consult Australia, there is still much work to be done, whether in our advocacy or in our ability to influence change across our industry. Whilst our industry confidence may have hit a small bump in the road we must continue to monitor, strategise and govern for all of our future prosperity. As President of our Association I have met many of you, travelled far and had the great opportunity to discuss the amazing projects we as an industry are able to work on— from the tallest building in the world to providing the precious resource of water in Africa, we are an industry that can truly make a difference, yet what we need is to continue to focus on where our next generation of visionary professionals will come from, and the technically qualified roles that we require. Let us not lose sight of the need to lobby government to get the basic education needs of our children right. Finally, I would like to thank my Board for providing the continuity and support that I and the organisation have enjoyed over the past two years and of course to Megan and her team who continue to give their dedication and support to our organisation and, perhaps more importantly to me, their patience. The studies have been done the statistics are in, the benefits identified, we have set the bold and disruptive initiatives—now all we need is the courageous leadership to implement change.
Matthew Harris President
What’s happening at Consult Australia
Consulting Matters
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From the CEO The greatest sales people will tell you they do more asking than telling. Why? Because the sweet spot of sales is finding the fit, and the more you can learn about the buyer the more likely you are to find it.
Of course, communication is the key.
Business success is really a pretty straightforward proposition…the science of matching a product or service to a consumer need. But matching services to needs is actually quite a tricky business. This is even more acute in the professional services sector where both the deliverable and the need are not immediately apparent or well defined. Of course our natural inclination is to rattle off our never-ending list of attributes of excellence and expertise, but success is always ultimately predicated on understanding the client’s needs, both stated and unstated. In pitching new ideas we often get caught up in our own brilliance rather than going back to basics…what does our client really want (sometimes as opposed to what they say they want), what are their drivers and what are their parameters for success. Then there is the need no-one knows they have until the product or service on offer highlights it. Steve Jobs often rejected traditional market research, and once told Business Week “A lot of times, people don’t know what they want until you show it to them.” Whilst his intuition ultimately paid off, this is rare in the business world. The more common approach is to test the market, and it is this approach that usually pays the biggest dividends.
The greatest sales people will tell you they do more asking than telling. Why? Because the sweet spot of sales is finding the fit, and the more you can learn about the buyer the more likely you are to find it. Unfortunately, however, in business we tend to rush this process, focused on getting the deal signed (often before getting the scope right)! This leads us to understand the “fit” only on a superficial level, and this often leaves the delivery of service wanting in the end. In the great words of Atticus Finch (still my first literary crush) from Harper Lee’s To Kill a Mockingbird, “You never really understand a person until you consider things from his point of view... Until you climb inside of his skin and walk around in it.” This is a great skill, and one that is honed by being well rounded, externally focused, and willing to listen and learn. Consult Australia tries to provide opportunities for our members to do just that. Whether it is through networking events with clients or politicians, producing our thought leadership or Economic Forecast reports, or providing forums for members to ponder the upcoming trends of the market, it is the external focus that being involved creates that tends to put members at a competitive advantage. But of course Consult Australia needs to listen too, in order to ensure that the products and services we provide to our members and sector are fit for purpose. We are always listening, and value member input to help us refine our offering in a continually changing and challenging business environment. Over the next few months, Consult Australia will be delivering even more value to
members through a range of new service offerings. One of these is ConsultHR, which gives members real-time, legally compliant, online access to a range of 28 specially selected HR contracts, policies and templates to help them run their business. We have introduced this service following extensive consultation with members (both large and small), who indicated that having access to a suite of HR/IR documents would assist them with both the time associated with dealing with these matters, as well as the regulatory burden and uncertainty that they created. Whether it is compliant employment or consultant contracts, or WHS policies and checklists you are after, ConsultHR is designed to make members’ lives easier at a fraction of the cost of developing these documents in-house or through regular third party suppliers. I look forward to letting members know more about this and other important upcoming services over the weeks and months ahead.
Megan Motto Consult Australia
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Consulting Matters
What’s happening at Consult Australia
Consult Australia appointments Steve Coghlan, State Manager WA Steve Coghlan has hit the ground running as our newest State Manager for Western Australia. As a graduate of both the Australian Defence Force Academy and Royal Military College – Duntroon, Steve started his career as an Army Officer before then transitioning to the corporate sector where he ran the WA operations for an engineering firm in the telecommunications sector. Up until recently Steve worked for the Department of Premier and Cabinet in WA before taking up the opportunity to join Consult Australia. He holds both a Bachelors degree in Politics and a Masters degree in International Relations. As State Manager for WA, Steve will take the lead on the local advocacy, events and professional development programmes. Contact Steve on 08 9281 6885 or at steve@consultaustralia.com.au.
Matthew Trigg, State Manager NSW With a background in architecture, Matthew has held a number of key positions relating to the built environment including with Uber, the Facilities Management Association, City of Port Phillip, the Australian Conservation Foundation, as well as with the City of Westminster in London. Holding degrees in architecture, sustainable development and public policy, Matthew has also been involved in numerous committees and boards, and brings to the role a wealth of existing industry connections. As State Manager for NSW, Matthew will take the lead on the local advocacy, events and professional development programmes, including the FutureNet young professionals program and the business leaders course. Contact Matthew on 02 82526708 or at matthew@consultaustralia. com.au.
Dio Connelly, Manager-Events & Education Dio has recently joined the team in the Consult Australia national office. Her most recent position was within the events department of a French multi-national investment bank in London and Paris. As part of these roles, she was responsible for organising corporate events, negotiating sponsorship contracts and supervising the bank’s involvement in financial conferences at a global scale. Prior to joining the bank, Dio worked as an event manager for European and African cultural not-for profit organisations. She holds Masters degrees in Economics and Communication. As Manager – Events & Education she will take on the management of Consult Australia’s signature national events and professional development courses. Contact Dio on 02 8252 6717 or at dio@consultaustralia.com.au.
Introducing ConsultHR! Consult Australia is excited to introduce our new service— ConsultHR. ConsultHR is an industry tailored version of the multi-award winning HR Advance, and is an online web-based subscription tool that enables businesses to comply with current Australian industrial relations laws and demonstrate best practice in their human resources, industrial relations and work health and safety management. It has been designed specifically to meet the needs of consultants working in the built and natural environment and contains a comprehensive library of customisable documents that are legally sound and which have been specifically selected to help you manage your people resources as effectively and efficiently as possible. Regardless of whether human resources is something you view as a distracting necessity in your consulting day or if it is the sole focus of your professional life – ConsultHR has something to offer you! Through your subscription to ConsultHR you will receive: •A ccess to 28 compliant documents including a range of policies, forms, checklists, correspondence and other resources that are customisable to your business. All documents are reviewed and endorsed by Australian Business Lawyers & Advisors and are centrally updated as required to reflect changes in law or policy. •B i-monthly email alerts keeping you informed of any changes to legislation and highlighting any subsequent changes in document templates to help you efficiently and effectively manage the impact of those changes on your business and ensure that your documentation is always up to date. •A ccess to online guides and guidance with information preceding each document to explain its use and application in your business and a contract wizard to help you select the right document for the right purpose. The HR Explainer is also available to provide explanations and definitions for over 300 employment-related topics. •S ecure online document storage making it easy for you to manage your human resource, industrial relations and work health and safety needs through a single safe, secure and readily accessible central location where you can also edit and manage your documents. • Ongoing educational opportunities through invitations to practical webinars that will provide useful tips and tricks. ConsultHR is a subscription service which operates on an annual licence. The annual subscription fees are $700 (incl GST) for Members and $950 (incl GST) for Non-members. Click here to learn more about the benefits of subscribing to ConsultHR or contact Kisanne Dulin, Director-Marketing & Membership via Kisanne@consultaustralia.com.au or on (02) 8252 6718.
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ConsultHR
Consult Australia introduces ConsultHR
ConsultHR is an online web-based subscription tool that enables businesses to comply with current Australian industrial relations laws and demonstrate best practice in their human resources, industrial relations and work health and safety management. Tailored specifically for our industry ConsultHR provides subscribers with easy access to 28 specially selected HR contracts, policies and templates that will enable everyone, including those whose main focus is on other areas of the business, to manage their people resources as effectively and efficiently as possible. You can view ConsultHR here or get more information by clicking here.
Consulting Matters
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Consulting Matters
What’s happening at Consult Australia
STATE DIVISION UPDATES QLD UPDATE July saw the release of the Queensland budget, but with asset sales off the table there was little to report that would provide major benefits across our membership. Creating a steady pipeline of work (breaking the boom/bust cycle) and better procurement remain our two key areas of focus. We have set up working groups for each of these areas and continue to welcome the feedback that members provide that supports the efforts of these groups. We were also pleased to have participated in a stakeholder workshop to input into the State Infrastructure Plan. The draft is due for release later this year for final comments before a final version is bedded down in early 2016. Following our submission in response to the Building Queensland Bill establishing Building Queensland as an independent agency to advise on the State’s infrastructure priorities, we were pleased to see many of our recommendations adopted in the Infrastructure, Planning and Natural Resources Committee’s examination of the Bill. These recommendations serve to strengthen the independence and transparency of Building Queensland and will support increased accountability for the Government and a better informed public debate regarding Queensland’s infrastructure
priorities. We continue to grow our stakeholder relationships and were pleased to have recently held meetings with: • Dave Stewart, Director-General, Office of the Premier to discuss the issues facing our industry and how we can work collaboratively with government; and • Queensland Rail to discuss setting up a regular forum with Consult Australia Following the release of the ‘Value Capture Roadmap’ (co-published by Consult Australia & AECOM), we were pleased to hold our Queensland launch in September with author Joe Langley and a great panel including David Quinn, CEO, Building Queensland; Chris Mountford, Executive Director, Property Council of Queensland and facilitated by Jonathan Cartledge, Director of Policy & Government Relations, Consult Australia. A number of discussions with client organisations have followed, including:
• Breakfast – Valuing Engagement •P rofessional Development – How to build trust and grow sales •C ocktail party – FutureNet and Consult Australia end of year celebration National Strategic Partner
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• Member only Boardroom lunch with Leader of the Opposition •B reakfast – Greg Chemello, General Manager, Economic Development Queensland • Breakfast – Implementing BIM in Australia: A commercial perspective
Communications Partner
What’s happening at Consult Australia
Consulting Matters
STATE DIVISION UPDATES VIC UPDATE The Division continues to build strong relationships with the new Government. The final passage through Parliament of Infrastructure Victoria (IV) was welcomed by Consult Australia in September. Consult Australia was a leading advocate for the establishment of IV, and worked closely with the then opposition to develop their policy. We look forward to working with the Government to ensure that Infrastructure Victoria is established in a way that fulfills its intended objectives. IV will play a crucial role in ensuring that important decisions around infrastructure are based on expert advice rather than political considerations, and avoid repeating the mistakes of the East-West Link motorway project. We were pleased to continue our advocacy for more innovative financing supporting new infrastructure in Victoria with the launch of our Value Capture Roadmap with AECOM.
NSW UPDATE New South Wales is gearing up for an unprecedented pipeline of projects with the tender process of some such as the Pacific Highway well underway and many more to open in coming months. This includes projects that have already been announced such as WestConnex and the expanded SydneyMetro, and even more on the books of Infrastructure NSW and the minds of policy makers from across the political spectrum. Funded by the revenue from the lease of electricity assets, this boom cycle is presenting its fair set of challenges along with some fantastic opportunities for consultants to work on once-in-a-lifetime projects. However, with this boom cycle comes concerns of an eventual bust. Many in the industry who remember tougher times too well, while optimistic, remain cautious and are keen to ensure the longevity of this newfound local prosperity, and it is in this area in particular
In a panel discussion with Kate Roffey, CEO of the Committee for Melbourne, and Jennifer Cunich, Executive Director of the Property Council in Victoria, there was widespread enthusiasm for governments to implement value capture and deliver better value for money for taxpayers in infrastructure delivery.
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The launch paved the way for our sold out Boardroom lunch with the Minister for Public Transport, the Hon Jacinta Allen MP in October, and followed our successful lunch earlier this year with the Chief Executive of VicRoads John Merritt. FutureNet Melbourne continues a strong program of events towards the end of the year. Taller, Greener, Modular will consider how innovative design and construction techniques are changing the skyline of Melbourne, and on the 2 December our not-to-be-missed end-of-year event at the Melbourne Town Hall will see former Premier the Hon Ted Baillieu keynote.
that New South Wales Division is set to focus in coming months. Two key areas of focus are in the areas of funding and talent. Funding insofar as what happens after the current cash splash, and while it happens the extent to which the government delivers better value for money through improved procurement and more innovative financing models like Value Capture. The need to gain and retain the right quantity and quality of talent to successfully tender for, win and deliver on this coming wave of projects is also important. Feedback from some in the industry includes concerns of the adverse effects of inflated salaries and the inability of firms to provide assurances of tenure for their staff in the longer term. For many it is akin to the recent mining boom, and presents an opportunity to learn those lessons and moderate the extremes of the boom/bust cycle in the years ahead.
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Consulting Matters What’s happening at Consult Australia
STATE DIVISION UPDATES WA UPDATE After 13 years of dedicated and unsurpassed service to the WA Division, the group has sadly said farewell to Josephine Howlett as WA State Manager whilst welcoming Steve Coghlan in her place. The enthusiasm Jo brought to the role was infectious, with her well known events management prowess and affable nature. She will be sorely missed by the Division having contributed greatly throughout her time in shaping both local WA and National member and event marketing initiatives over her time as State Manager. Amongst many of the legacies to her name, the FutureNet young leaders group is one of the key initiatives that she started first in WA before then being adopted by the other Divisions in other States. We wish her all the best in ‘retirement’ knowing full well that her contribution over the past 13 years has left the WA Division, and Consult Australia, in a very good place!
NT UPDATE The Division’s focus remains on procurement reform, in line with work being undertaken by the Northern Territory Government. Outcomes from our round of meetings in June to discuss the Economic Benefits of Better Procurement Practices report include: The commencement of a Consult Australia and Department of Business forum to provide ongoing engagement between industry and government. Actions arising and information received from these meeting is distributed to members via email updates. We have had a positive response from the Department of Infrastructure to recommendations regarding: • The adoption Australian Standard AS41222010: General Conditions of Contract for Consultants as the preferred form of engagement for consultants providing services to the department • The scope for change in the current tender process to alleviate high bidding costs. We
In advocacy news, off the back of recent successful launches of the More for Less campaign and the Deloitte Access Economics Report in to The Economic Benefits of Better Procurement Practices, Steve Coghlan is busily putting together the WA Division’s Policy Target Packages which he will use to help prosecute the WA Divisions push for fairer contract engagement. The emphasis on the push for change in the contracts area is based on achieving a win-win for both the industry and their customers alike. There will be more to come in the advocacy space in WA off the backend of some key up and coming initiatives in the months ahead. On the events side, there is an upcoming Building Information Modelling (BIM) session, sponsored by AutoDesk, to be held in mid-October followed by our annual Sponsors Lunch which will be occurring in mid to late November.
Mobility, and the End of Year Function on the 27th of November set to be an inspirational end to the year with Dr Ric Charlesworth AM as speaker. National Strategic Partner
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FutureNet, have already locked in their final two event speakers for the year, with Dr Ryan Falconer speaking on the 16th of October on The Future of Our Cities - MegaTrends and its Effects on Transport and
believe the removal of proof of compliance requirements against specific assessment criteria such as WHS, capability, local content and risk should not be required by all bids at the time of tendering, but should only be provided by the winning tender. This would be a simple and positive move towards alleviating some of the cost of tendering currently borne by firms – or indeed being passed on to the client. Recent events in the NT included a breakfast with the Land Development Corporation. Consult Australia members attended the breakfast to develop a better understanding of The Corporation’s vision for the next 12 months and beyond. Attendees were given an update and overview of expected upcoming land development projects, and discussed how their business might contribute to the future growth of the Territory and enhance local business and industry capability. Our member only Boardroom Breakfast in August was with Territory Generation (formerly an operational business unit of the Power and Water Corporation (PWC)). As
part of reforms announced by the Northern Territory Government in December 2013, Territory Generation underwent structural separation from PWC, forming a separate Government Owned Corporation. Consult Australia members gained an overview of the future for Territory Generation and the rollout transition from PWC together with an update on current and future tender and procurement processes.
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What’s happening at Consult Australia Consulting Matters
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STATE DIVISION UPDATES SA UPDATE The Division continues to build on relationships established or strengthened following the publication of the Economic Benefits of Better Procurement report, which realised a strong platform for our ongoing campaign for better procurement in this state. Key activities include: Consult Australia participating in an Office of Industry Advocate (OIA)/ State Procurement Board (SPB) – Advisory Panels special meeting to discuss changes to simple procurement held 3 July. SPB presented, with key observations from the meeting being: • SPB finding challenges in obtaining value for money outcomes within current guidelines • Discussion on possible measures/methods to turn this around • Consult Australia enjoyed the opportunity to advocate AS4122-2010, limited liability and other procurement reforms to assist SPB in moving forward Following this meeting the OIA came back to Consult Australia for feedback on the South Australian appetite for reforms recommended in the Economic Benefits of Better Procurement report given our
ACT UPDATE There has been a great deal of change in the ACT over the last few months. The local committee is now the Canberra Regional Committee, covering South NSW / ACT, and is chaired by Tim Chapman [SMEC], with Therese Flapper [GHD] and Joel Stevenson [Calibre Consulting] as deputy chairs. Recent advocacy included a strongly-worded criticism of the Canberra Liberals for an ‘anti investment letter’ threatening to tear up any contracts signed between the ACT Government and those bidding to deliver the Capital Metro Light Rail scheme. ABC and local radio stations covered the piece, with the issue being escalated to former Deputy Minister for Infrastructure Jamie Briggs. Meetings have also taken place with the ACT Chief Minister advocating for improved
recent procurement reform discussions with government departments and agencies. The Boardroom Lunch with Michael Deegan, CEO of the Department of Planning, Transport and Infrastructure delivered a meeting with department leaders to discuss an ongoing working group/forum with the aim of strong engagement between industry and government. The Boardroom Lunch with Mr Kevin Scarce AC, CSC, RANR - Royal Commission into the Nuclear Fuel Cycle included discussion on the Terms of Reference for the Commission, expected level of bipartisanship and community support to progress recommendations through Parliament, and what a nuclear industry could mean for the consulting industry. Follow up engagement provided information on upcoming packages of works to members.
Industry Breakfasts: Value Capture Roadmap - with a facilitated panel discussion on this alternative infrastructure funding and decision making tool. Valuing Better Engagement – quantifying the value of stakeholder engagement for infrastructure delivery. Architects and Engineers Roundtable – an invitation only roundtable lunch National Strategic Partner
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We will continue our focus on working with stakeholders for practical outcomes for our members. Other division events included our Industry Breakfast Series on Urban Infill: Delivering the Future and a presentation from Mr Raymond Spencer: Chair, Economic Development Board
Silver Sponsors:
Upcoming SA events include: Member only Boardroom Lunch Series: The Hon Stephen Mullighan Minister for Transport and Infrastructure
procurement practices, the ACT Deputy Chief Minister, advocating for best practice in cities, members of ACT Government’s Procurement and Capital Works Department, and the Director General of Capital Metro. At a Federal level, almost 60 people attended ‘The Urgency of Now’ at Old Parliament House discussing diversity in context of a rapidly changing world with speakers including: Julie McKay, Gender Advisor to the UN Defence Force and ED of UN Women; Lyn O’Connell, Assistant Secretary to the Dept. Infrastructure and Regional Development [soon to move to Dept. Agriculture]; Jill Bruning, Executive Vice President of AECOM; Lara Poloni, CEO of Aus & NZ; and Megan Motto, CEO of Consult Australia. FutureNet continues to go from strength to strength, with the last event ‘YOU’ attracting almost 100 people to hear from
the Editor of Her Canberra, Amanda Whitley, and a Director from Molonglo Group, Phill Rushby. FutureNet has also delivered two ‘Casual Sessions’, an informal, relaxed networking event put together in partnership with the National Association of Women in Construction, ACT Emerging Architects, Planning Institute of Australia, and the Act Young Builders Alliance. National Strategic Partner
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12
Consulting Matters Features
Delivering a customer collaborative culture JOHN CLAY, PRINCIPAL | HEAD OF MARKETING AND COMMUNICATIONS AT ARUP AUSTRALASIA – DRAWS ON ARUP’S SUCCESS TO SHARE SOME OF HIS INSIGHTS INTO HOW YOU CAN SUCCESSFULLY CREATE A CLIENT CENTRIC CULTURE THAT IS BALANCED WITH A FOCUS ON PROJECT DELIVERY .
‘Client centric’ is a term as overused as Shane Warne’s tweeting fingers. While Warne’s tweets are popular for their surface level entertainment value, in the case of ‘client centricity’, the origins of its popularity stem from a deeper place…that being its vital importance in a successful business development process. Having a client centric approach is vital for business. When you have a close relationship with clients, and provide multiple services to them, both parties benefit—cost of delivering services decreases and time in acquiring services is shortened. Customer centricity is about understanding what the clients business drivers are; to then enable you to evaluate the best mix of solutions you have within your capability, in order to help meet those business needs. Sometimes it may even mean suggesting other organisations that are better suited to meet those needs. It’s about looking at wider relationships with the client. Not just the narrow relationships that reside within one specific project. Balancing a project delivery focus and a client relationship management approach is tricky at times. It’s a juggling act between strategy and structure, culture, systems and programs such as skills training, client feedback, account management and client communication. A true client centric approach can’t just be added on. It must be embedded from the top down, the bottom up and the middle outwards! It requires alignment with your culture, core values and philosophy. You can’t drive programmes within the marketplace if you aren’t true to your values as a company. If values are at odds to your culture then it will be challenging to succeed. At Arup for example, we ensure that all employees receive a copy of the ‘Key Speech’ given by our founder Ove Arup, and his philosophy still resonates throughout our firm. Having a strong focus on living these values and making people more accountable for their behaviour often helps shift the firm’s overall mindset and approach. In order to improve our client centric approach to the marketplace, a number of
key items have been put in place over the past few years to drive our ship to port; but there is always still more to do. Buy-in. The first key element is recognition across the leadership of the firm, board and the CEO that it’s not good enough to deliver a project on a project by project basis, you need to have an overarching relationship management approach to clients as well. An issue on one project may impact upon other projects across the client. Support. A supporting strategy and structure is essential in order to be able to implement it. Make sure there are appropriate professional marketing, business development and communications teams to drive this approach and take it forward. Key programmes. Ensure employees can cope with the change of mindset required by implementing a whole range of activities to drive a client centric approach. Consider implementing a range of programs around four main areas: • U nderstanding your clients better—how do you understand client insights and key activities for the client? Effective client feedback at a project level and across the wider client relationship is key. • I mproved client handling skills—put staff through a client relationship management skills training program (Arup used one run by RogenSi) to provide new skills to some and sharpen the existing skills of others. This type of training complements an increased focus on specific markets and clients. Selecting, recruiting and developing the right Relationship Managers is also key as they are often the champions and catalysts of this change. They create the early wins and successes necessary to prove the benefit of this approach. • E ffective systems and networks—to enable the support of these programs, e.g. CRM systems, intranet and extranet platforms, skills networks and information systems to support your approach. Support these systems with a range of awareness workshops, trained ‘super-users’ within each office and by running key programs to demonstrate how they can be used within
each location. It’s always challenging, but systems are there to enhance your engagement delivery, they are not there to over-complicate your approach. • C ommunications—have a focus of client activity and communicate to staff with complete transparency. Also key is increased and ongoing communications with staff about your brand and on the topic of client collaboration and how it impacts the business. Creating a successful client centric culture can only be achieved if the map (strategy / systems / programs) is reviewed, evaluated, changed and questioned on an on-going basis. Board level focus is needed to review and critique performance across the marketplace and identify areas for continued improvement; while engagement with office and sector leaders will allow you to assess their structures and strategies to ensure the right ones are in place to drive their local operations forward. Introduce key performance indicators around clients or relationships to focus peoples’ attention—as the old adage says ‘what gets measured, gets managed’. Remember, making this change takes time these key items and the programs we use at Arup haven’t popped up overnight. Does it work? For Arup, we are proud to say that applying these principles has led to an increased standing in the annual AFR Client Choice Awards, winning the 2015 award; with recognition as being one of the leading engineering firms when it comes to innovation, design and client relationship engagement. It’s good to remember though that customer centricity may have a natural limit. In all areas of business there needs to be a balance between parties if it’s going to work. There has to be a win-win focus ensuring you steer clear of each end of the spectrum for a truly collaborative approach to work. John Clay Principal | Head of Marketing and Communications Arup Australasia
Features Consulting Matters
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14
Consulting Matters Features
Know thyself – looking inward then growing outward In keeping with this, we went ahead and created some new roles and structures to give our top people support to be better at what they’re good at. Giving our people the latitude, the structure and the permission to go out there and do what they’re good at has been really important for us, and I now credit this action as key to our business’s recent growth. ‘Nurturing’ Also around this time we had some great conversations about building positive client relationships. We arrived at a concept we now call ‘nurturing’. Nurturing is a pretty different way of thinking about relationships. It’s building up trust over a period of time, and caring for a relationship as it grows. Most of all it’s about giving our clients value. A Northrop business development ‘buckethead’ meeting. Photo by Luc Szczepanski.
STRUCTURAL ENGINEER STEPHEN MAHER ON THE STEPS HIS COMPANY NORTHROP HAS TAKEN TO REFOCUS ON RELATIONSHIPS; WHICH IN THE PAST FOUR YEARS HAS SEEN ITS SYDNEY PRACTICE MORE THAN DOUBLE IN SIZE AND CEMENT NEW, LONG-LASTING PARTNERSHIPS.
I’ve been an engineer for a while now, and a big chunk of my career – 15 years this year – has been at Northrop. My role at Northrop sees me being a structural engineer a lot of the time, and working closely with our client stakeholders and business development team to grow our business and our relationships the rest of the time. In this article I would like to share the journey Northrop’s been on to focus on relationships as the key to growth. The result of our efforts has been new clients; new, more valuable work from existing clients; and an engineering team that has more than doubled in numbers. UNDERSTANDING PERSONALITIES AND PLAYING TO OUR STRENGTHS Northrop has traditionally had great client relationships. And long term ones. Lucky for us, it seems to have been something we have been naturally good at. But a few years ago now, we also realised that while we had these great successful relationships
and some very smart business development minded people, there was nothing strategic or organised about what we were doing – no method to the madness. In the past there had been an implicit assumption that our owners needed to be all things to all people. But what we realised was that there are some quite different types of people at Northrop with distinctly different strengths in business development. We have talented people who are brilliant at finding new work and making new connections; you might call them hunters. And we also have farmers; people who are naturally good at being close to their contacts, nurturing those relationships and helping them grow. A big thing we pride ourselves on at Northrop is having a high performance culture that helps our people play to their strengths.
We look for regular contact with the client outside of the project work. We feel that’s an important part of nurturing the relationship. And we try and add value that’s outside the project scope. Over a 12 month period we try and be in contact with the client outside of the project on a fairly regular basis - every couple of months usually. That could be a beer and cheese event here in the office, maybe a lunch where we bring other Northrop people along, sometimes industry events which we might invite clients along to. In any business development activity we do now, the filter is, “is this of real value to the client?” If it doesn’t easily fit through that filter, we won’t do it. GETTING TO KNOW OURSELVES Another fundamental thing for us has been understanding better who our clients were and why they liked us. It sounds easy but it’s not quite always in a multi-disciplinary organisation like Northrop.
A big thing we pride ourselves on at Northrop is having a high performance culture that helps our people play to their strengths. In keeping with this, we went ahead and created some new roles and structures to give our top people support to be better at what they’re good at.
Features Consulting Matters
Another fundamental thing for us has been understanding better who our clients were and why they liked us. It sounds easy but it’s not quite always in a multi-disciplinary organisation like Northrop.
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We didn’t necessarily think this was such a big deal at the start. It wasn’t until we spent some time thinking about our point of difference – what was it about Northrop that clients loved and kept them coming back – that we realised that we actually had something quite valuable, and something that certain types of client would connect with more than others.
and make targeted approaches to the right organisations. We also improved our existing client relationships, because we now had a better sense of what was important and valuable to our clients – and we had people whose specific role it was to nurture.
We worked at it until we could define those clients clearly. This was a big breakthrough.
For us, growing the business and winning new work came about by getting to know ourselves better, and by playing to our strengths.
Suddenly, strategic business development was much simpler. We would set targets – say, five client organisations that we weren’t working with but wanted to, who fit the description we had of clients who gelled with us. And we would work purposefully to meet those clients and nurture those relationships into jobs. We were able to go out into the market with a confidence in ourselves
There were stops and starts, and lessons along the way. But mostly, it worked!
Being true to who we are and focusing on clients who bought into that has made us a better business. And I believe we have a happier team and happier clients too! Stephen Maher Principal and Senior Structural Engineer Northrop www.northrop.com.au
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16
Consulting Matters Features
The real value is in the relationship Exploring ways to deliver greater value and more efficiency on projects and in the workplace Winning new business is challenging in a competitive market and offering clients greater value for money and more efficiency on delivering their projects is a necessity. Having a track record of delivering projects on time and on budget helps to win the next project but being able to offer value and efficiency at every stage of a project from the bid to delivery and to demonstrate how that value will improve the outcomes of a project, can not only win you the next job but help you cement relationships with clients that will win you repeat business. Clients not only want great value and efficiency but they want their projects delivered without delays, without major issues and with their reputations intact. Adding a communication and stakeholder engagement team is the (not so secret) weapon to cementing client relationships, delivering greater value and efficiency and consequently, winning repeat business. By having an effective communication and stakeholder engagement strategy and an experienced and competent team integrated into your project from bidding through to delivery gives a consultancy the competitive advantage. Enhancing client relationships, offering strategic advice to the project team, knowing how to engage with stakeholders and the community, as well as writing and editing project documents is just the beginning of how communication and stakeholder engagement adds value to a project. At Aurecon, many of the projects we work on involve substantial changes for communities from new roads to new rail lines and new buildings to revitalising whole regions. Having
Senior Aurecon Communication and Stakeholder Engagement consultant, Laura Stewart speaking at a community reference group meeting. Photo courtesy of Aurecon
communication and stakeholder engagement built into a project from the beginning means we can better understand stakeholder and communities’ needs and issues early, we can build relationships and regularly communicate with stakeholders and the community through the project lifecycle. The role of the communication and stakeholder engagement team is to communicate
Clients not only want great value and efficiency but they want their projects delivered without delays, without major issues and with their reputations intact. Adding a communication and stakeholder engagement team is the (not so secret) weapon to cementing client relationships, delivering greater value and efficiency and consequently, winning repeat business.
project information to the community, build relationships, listen to their feedback, issues and interests and provide this input to the project, delivering better results for the community, the project and our clients. Building relationships with communities can often deliver surprising client and project benefits. On a recent road project, the ‘lived’ flooding experiences of residents were incorporated into the flood modelling and their experience helped inform a road being built to better withstand the regular flooding experienced in that area. Communication and stakeholder engagement is a standard element of most public infrastructure projects today. This reflects the change in expectation that stakeholders and the community have of government at all levels but it is also a reflection of the value that effective engagement can add to any project. When communication and engagement is lacking early in a project lifecycle there can be significant issues that impact a project’s program and cost money to resolve.
Features Consulting Matters
Uninformed communities and stakeholders can become hostile and resolving issues so projects can continue can take significant time and money. If communities reach the point of ‘moral outrage’, entire projects (or parts of them) can be significantly delayed or even cancelled. A good example of this, is the pressure from the community on Coal Seam Gas exploration that has led to exploration licenses being cancelled.
others might not and to see projects from the point of view of the stakeholder and the community. This could range from looking at alternate design options to go around a property rather than through it, to minimising construction impacts by suggesting alternatives like working community friendly hours or suggesting work stops on the weekend of the annual community fair or fundraiser.
If consultancies bid for a new project with a team that understands the client, the project and the stakeholders, they are providing a level of reassurance that communication will happen early and the risk of project delays and increased costs due to community issues is significantly reduced. Identifying risks and potential issues early and minimising their impact or avoiding them altogether, protects and enhances a client’s reputation.
The value that effective communication and stakeholder engagement can add to any project will contribute significantly to the success of a project at every stage, build a long term relationship with clients and help you win repeat business.
Part of our role as communication and stakeholder engagement professionals is to look at a project from a different point of view. We are relationship experts, understanding people, political landscapes and media, we are trained to listen and to ask questions that
Winning new business should be about looking at how to deliver the best possible outcomes for a client and the stakeholders and communities they interact with and greater value and efficiencies will follow, not to mention great relationships. Kelsey Nash and Lucy Beytagh Aurecon
For consulting firms in the built and natural environment by Phil Ruthven
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18
Consulting Matters Protecting your business
Run off cover and retirement strategies for professionals Professionals accumulate liabilities from services provided throughout their career; these liabilities often carry forward into retirement and it is therefore important to have an appreciation of both the nature of these liabilities as well as strategies to insure or otherwise manage the risk that these liabilities may give rise to a claim. The traditional approach to managing these risks involves the purchase of professional indemnity (PI) insurance 'run off' cover, however for firms no longer generating an income this can end up being a relatively expensive exercise.
The cost of run off varies significantly across insurers; a useful rule of thumb is 80-90% of the previous year’s premium on a reducing balance basis, meaning that in your first year of run off you can expect a premium of 80-90% of your previous year’s premium. Over a 6-10 year period premiums can cumulatively become significant.
WHAT IS RUN-OFF COVER? Run off cover is a restricted form of PI Insurance that limits cover to claims arising out of historical services provided prior to a firm’s cessation. Run off cover is typically purchased yearly, the same as policies covering an active business, however some insurers now provide multiyear run off policies covering firms for fixed periods of up to seven years. To fully appreciate the operation of run-off cover it is important to first understand the ‘claims made’ nature of PI insurance. PI insurance belongs to a class of insurance that operates on a ‘claims made’ basis which means it is the policy that is in effect at the time a claim is made that will respond to the claim (rather than the policy in effect when the relevant service giving rise to the claim was provided). This ‘claims made’ basis requires that firms maintain a current policy as long as they require insurance protection because cover ceases immediately upon policy expiry. The ‘claims made’ basis is not of particular concern to firms that continue to trade because they are able to fund a new policy each year from operating cash flow, covering any claims that may arise out of their present or past work. Issues arise when a firm no longer generates cash flow but requires ongoing insurance in order to protect itself against claims that may arise out of past activities. The cost of run off varies significantly across insurers; a useful rule of thumb is 80-90% of the previous year’s premium on a reducing balance basis, meaning that in your first year of run off you can expect a premium of 8090% of your previous year’s premium. Over a 6-10 year period premiums can cumulatively become significant.
CORPORATE VERSUS PERSONAL LIABILITIES
issues to consider when deciding how long to maintain run off cover include:
Business structure can significantly influence the liabilities accumulated by individuals and the extent to which these liabilities follow into retirement.
•S tatutory obligations: Most regimes that impose an obligation upon professionals to be covered by professional indemnity insurance only require insurance for the period of accreditation/registration; therefore once accreditation/registration ceases the (statutory) obligation to maintain insurance usually ceases also.
Businesses operating as sole traders or partnerships will accumulate liabilities that continue to attach to the natural person(s) into retirement because the “business” is not a separate entity to the owners. Incorporation can provide a significant level of protection for directors and employees making it difficult to claim against the natural person. However for some professionals, particularly those providing services as a natural person under building legislation (such as Building Practitioners under The Building Act 1993 (VIC) and Accredited Certifiers under the Environmental Planning and Assessment Act 1979 (NSW)) liability attaches to the natural person with the corporate veil being effectively ignored. It is also important to consider the liability implications of performing different functions such as sign off or certification versus simply providing support services as part of a team. Employment by a large firm provides a certain level of protection in that it is likely the firm will continue to trade and purchase ongoing insurance. FOR HOW LONG SHOULD I MAINTAIN RUN OFF? For most professions, the question of how long to maintain run off insurance is a choice rather than an imposition. Some of the key
• Liability periods: A statute of limitation period of six years is often mentioned, however liability periods vary significantly across professions and industries. There is a ten year cap on building matters under the Building Act 1992 (VIC) however it is important to note that this applies to building matters and may not apply to a personal injury matter arising out of a building project. •C lient/contractual obligations: whether you have assumed under contract an obligation to maintain insurance for a period beyond the completion date of a particular contract Consultants should therefore obtain advice specific to their business/activities when considering the liability period that applies to them. OTHER RETIREMENT OPTIONS There are a limited number of alternatives to the purchase of run off cover; One option is to divest assets and wind up the business without purchasing ongoing insurance. Having no assets (i.e. a man of straw) is a deterrent for potential litigants. However this still leaves you exposed to
Protecting your business Consulting Matters
the risk of significant legal costs in defending a claim. By choosing not to purchase run-off cover (or some other form of replacement policy), you will lose any benefit of having had any insurance in the past, leaving you uninsured for any claims that may arise out of your past work. Having new owners take over the responsibilities for the on-going liabilities of the business through succession or sale is often the most cost effective option of maintaining cover: • A common approach is to formulate an internal succession plan with existing staff or family members. This requires a level of forward planning with key staff with a time horizon of at least five to ten years prior to your planned retirement. The expectation is that those who succeed the business acquire an interest in maintaining insurance for the business which should also continue to protect you. • Selling the business to a third party upon retirement is another option; if doing so it would be prudent to build into the sale contract an obligation of the new owners to continue to maintain insurance. If succession/sale of your business is not an option and the thought of being uninsured is not appealing; there are number ways for a business to reduce the cost of purchasing run-off Insurance; these depend upon particular circumstances and involve taking a strategic approach to the winding down of operations. Please contact the author for further information in this regard. The most important point to note is that implementation of strategies for sale/succession and/or to minimise the cost of run off all required significant lead time therefore it is critical to obtain good advice from a specialist professional indemnity insurance broker well in advance.
Professional Indemnity question? Consult Australia believes that it is important to support members in all aspects of their business. We also recognise the impact that the insurance market has on Consult Australia member firms in terms of availability, affordability and quality of Professional Indemnity insurance. Post your latest Professional Indemnity insurance cases on the Consult Australia Linkedin group and our PI Insurance Pathway will advise you on the best steps to tackle these issues.
Rudolph Gouws Bovill Risk & Insurance Consultants To the extent that any of the above content constitutes advice, it is general advice without reference to your needs or objectives and therefore cannot be relied upon. Before acting on the above information you should obtain advice specific to your needs. Rudolph Gouws is an insurance consultant with Bovill Risk & Insurance Consultants Pty Ltd (BRIC). BRIC are specialist professional indemnity Insurance Brokers and part of the Consult Australia PI Pathway.
BRIC
Bovill Risk & Insurance Consultants
If you would like further information on this topic you can contact Rudolph at RudolphG@bric.com.au or phone 1800 077 933 Protecting Professionals
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September quarter 2015 Overview In the July update of key projections in World Economic Outlook, the International Monetary Fund (IMF) lowered its April forecast of world growth in 2015 from 3.5 to 3.3 per cent. Weaker than expected first quarter growth, mainly in North America, was the main reason. Growth of 3.8 per cent was still forecast for 2016. This looks too rapid; we expect only a slight acceleration to 3.4 per cent. Growth in China was unchanged from 7.4 per cent in 2014, 6.8 per cent this year and 6.3 per cent in 2016. With an economy the IMF estimates to be slightly larger than that of the United States, China’s forecast growth nevertheless remains impressively rapid.
World Economic Growth: 2014, 2015 & 2016 China India ASEAN-5* Developing economies United States World Advanced economies
2014 2015 2016
Euro area Japan
* Indonesia, Malaysia, Philippines, Singapore & Vietnam
-1
0
1
2
3
4
5
Source: IMF, July 2015
The Australian economy grew by a relatively slow 2.4 per cent in 2014/15. The seasonally-adjusted annual rate of growth in the last quarter of 2014/15 was only 0.8 per cent, generated mainly by increased government spending, not on infrastructure but on current goods and services. With commodity prices down and no sign of effective economic policy-making in Canberra, growth is expected to remain well below its long-term average of 3.2 per cent for the next two years. The Reserve Bank’s latest forecast (August) is for growth of 2–3 per cent in 2015/16 and 2.5–3.5 per cent in 2016/17. Preliminary estimates of work done in the June quarter of 2015 show that new housing activity, which had been growing strongly, fell by 4 per cent to a seasonally-adjusted annual rate of $51.3 billion. Work on housing renovations, however, which has shown little growth over the past three years, increased by 2 per cent to an annual rate of $29.5 billion. Non-residential building activity fell by 2 per cent to an annual rate of $34.7 billion: a bit below the rate that has been achieved nearly every quarter for the past two years. Rather surprisingly, engineering construction activity, which had been falling for six quarters, increased by 6 per cent to an annual rate of $106 billion. Detail about types of construction will be published on 30 September. In the meantime, as there was a big rise in activity in Western Australia, it is safe to assume that mining, oil and gas contributed most of the increase.
6 7 8 % change on previous year
Australian Economic Growth Percentage increase in real GDP
% 4.0
3.7%
forecast
3.5 3.0 2.5
2.5%
2.5%
2.4%
2.5%
'12-13
'13-14
'14-15
'15-16
2.7%
2.0 1.5 1.0 0.5 0.0 '06-07
'07-08
'08-09
'09-10
'10-11
'11-12
16/17
Source: ABS 5206.0, author's forecast
Selected Construction Activity, Australia $ billion 80
Seasonally-adjusted annual rates, in constant 2012/13 prices
Other engineering construction 70 Mining, oil & gas
60
estimates
50 New housing 40
Non-residential building Housing renovations
30
Source: ABS 5206.0, 8755.0
20 Sep '12
Dec
Mar '13
Jun
Sep
Dec
Mar '14
Jun
Sep
Dec
Mar '15
Jun
Work Done on Non-residential Building, Selected States
Non-residential Building
Chain volume measures, base 2012/13 seasonally-adjusted annual rates
$ billion
12
Preliminary estimates suggest that national activity fell by two per cent in the June quarter of 2015 to a seasonally-adjusted annual rate of $34.7 billion and was also two per cent lower than a year earlier. Activity steadied in New South Wales and increased in Western Australia but was down in the other three large states. Forward indicators weakened in the March quarter (the latest available) and were negative. Work commenced in Australia in the year to March was 13 per cent less than work done; and at the end of March there was less than eight months work in the pipeline: down from nearly nine a year earlier. The indicators were positive in Tasmania and neutral in New South Wales but negative in all other states and territories.
NSW
10
Vic
8 6
Qld WA
4 2
SA Source: ABS 8755.0
0 Sep '12
Dec
Total work approved in 2014/15, at $28.5 billion, was 21 per cent less than work approved in the previous year. As the chart opposite shows, approvals picked up recently in Queensland and South Australia but continued to fall in the other large states. Business confidence improved in the June quarter, although it weakened again in July and August. From recently depressed levels, we expect national approvals to trend slightly higher in the year ahead. Measured in 2012/13 prices, activity eased slightly to $35.1 billion in 2014/15. With recent approvals so low, we expect a fall of nearly 6 per cent in 2015/16 with only a modest recovery in 2016/17.
Jun
Sep
Dec
Mar '14
Jun
Sep
Dec
Mar '15
Jun
Non-residential Building Approved, Australia: by type $ billion
Seasonally-adjusted annual rate, in constant 2012/13 prices
45
In the June quarter, national approvals fell by 16 per cent to a seasonallyadjusted annual rate of $25.1 billion and were 22 per cent lower than a year earlier. Increases in commercial approvals – both offices and shops – were more than offset by falls in all other types, but especially in health and aged care buildings which fell by 42 per cent. Public sector approvals increased in the June quarter, their market share rising from a depressed 13 per cent to 18 per cent.
Mar '13
40 35 30 25
Other
20
Health & aged care Education
15
Industrial
10
Commercial
5
Source: ABS 8731.0
0 Sep '12
Dec
Mar '13
Jun
Sep
Dec
Mar '14
Jun
Sep
Dec
Mar '15
Jun
Non-residential Building Approved, Selected States $ billion
Trend values at annual rate, in constant 2012/13 prices
12 10 8 6 4 2 0 Sep '12
Dec
Mar '13
Jun
Sep NSW
Non-residential Building Forecast: by State & Territory
Dec Vic
Mar '14 Qld
Jun SA
Sep
Dec
WA
value of work done, $ million, constant 2012/13 prices
VIC
QLD
SA
WA
TAS
NT
ACT
Australia
2012/13 (a)
8,036
8,294
6,761
2,242
5,616
419
1,046
991
33,406
2013/14 (a)
9,391
8,829
7,064
2,294
5,416
457
1,054
700
35,205
2014/15 (a)
9,967
9,506
6,342
2,157
5,178
468
708
725
35,051
2015/16
9,200
8,700
6,370
2,140
4,700
480
690
720
33,000
2016/17
9,450
8,800
6,500
2,150
4,980
520
700
800
33,900
16.9
6.5
4.5
2.3
-3.6
8.9
0.8
-29.4
5.4
% change 2014/15
6.1
7.7
-10.2
-6.0
-4.4
2.5
-32.9
3.6
0.4
2015/16
-7.7
-8.5
0.4
-0.8
-9.2
2.6
-2.5
-0.7
-5.9
2016/17
2.7
1.1
2.0
0.5
6.0
8.3
1.4
11.1
2.7
a = Actual
Jun
Source: ABS 8731.0
NSW
2013/14
Mar '15
Work Done on Engineering Construction, Main States
Engineering Construction
Chain volume measures, base 2012/13, seasonally-adjusted annual rates
$ billion 50 45
Recent activity
40
Preliminary estimates suggest that the volume of work done increased by 6 per cent in the June quarter to an annual rate of $106 billion, 9 per cent less than a year earlier.
35 30 25 20 15
Activity continued to fall sharply in Queensland and to ease in most other states. The exception was Western Australia, where the volume of work done rose by more than a third to an annual rate of $45.3 billion. Work on the Roy Hill iron ore mine and on the Gorgon, Wheatstone and Prelude LNG projects was the likely cause of the big increase. Forward indicators continued to weaken in the March quarter as no large projects started to replace those completed and about to finish. Nevertheless, at the end of March there was still more than nine months work yet to be done: the bulk of it in Western Australian mining, oil and gas projects. Commencements fell sharply in the March quarter and in the year to March, at $55.4 billion, they were 26 per cent lower than in the year to March 2014. They have been holding up quite well in New South Wales and Victoria but are continuing to ease elsewhere. The volume of work yet to be done fell by 8 per cent to $83.4 billion in March and was 26 per cent less than a year earlier. Seventy per cent of this work ahead is on mining and heavy industry.
10 5 0 Sep '12
Dec
Mar '13
Jun
Sep
Dec
NSW
Vic
Mar '14
Qld
Jun
SA
Sep
Dec
Mar '15
Jun
Source: ABS 8755.0
WA
Engineering Construction Commenced, Selected States $ billion 60
Moving annual totals, in constant 2012/13 prices
50 40 30 20 10 0 Jun '12
Sep
Dec
Mar '13
Jun
NSW
Sep
Vic
Dec
Qld
Mar '14
SA
Jun
Sep
Dec
Mar '15
Source: ABS 8762.0
WA
Engineering Construction Work Ahead, Australia $ billion
Value of work yet to be done, in constant 2012/13 prices
160
Recreation & other
140 Telecommunications
Measured in 2012/13 prices, activity fell by 14.8 per cent to $105.7 billion last year. It is forecast to fall by some 18 per cent this year to $87 billion and by 11 per cent to around $77 billion in 2016/17.
120 Water & sewerage
100 80
Electricity & pipelines
60
Bridges, railways, harbours
40
Roads
20
Source: ABS 8762.0
0 Jun '12
Engineering Construction Forecast: by State & Territory
Sep
Dec
Mar '13
Jun
Sep
Dec
Mar '14
Jun
Sep
Dec
Mining & heavy industry
Mar '15
value of work done, $ million, constant 2012/13 prices
NSW
VIC
QLD
SA
WA
TAS
NT
ACT
Australia
2012/13 (a)
23,105
10,861
40,571
5,751
43,673
1,154
3,076
856
129,047
2013/14 (a)
19,299
10,295
42,331
5,287
42,010
1,166
3,047
871
124,025
2014/15 (a)
16,685
9,633
27,978
3,854
37,743
1,179
7,963
680
105,715
2015/16
19,200
9,200
18,300
4,850
30,200
930
3,600
730
87,000
2016/17
20,500
8,900
15,100
5,110
23,700
970
2,100
720
77,100
2013/14
-16.5
-7.8
4.3
-8.1
-3.8
1.1
-1.0
1.8
-3.9
2014/15
-13.5
-3.8
-33.9
-27.1
-10.2
1.1
161.4
-21.9
-14.8
2015/16
15.1
-4.5
-34.6
25.6
-20.0
-21.1
-54.8
7.4
-17.7
2016/17
6.8
-3.3
-17.5
5.6
-21.5
4.3
-41.7
-1.4
-11.4
% change
a = Actual
Population Growth, Australian States
New Housing
'000
110
Population growth is slowing. In the year to December 2014, Australia’s population increased by 330,200: 11 per cent less than the increase of 374,600 in calendar 2013. Natural increase of 146,100 was 8 per lower and net overseas immigration of 184,100 was down by 15 per cent. Growth was little changed in South Australia and Tasmania and weakened only slightly in New South Wales and Victoria. But there were big falls of 35 per cent in Western Australia and 17 per cent in Queensland. The trend in national dwelling approvals eased in both the June and September quarters and the fall was common to most of the larger states. Only in New South Wales did dwelling approvals continue to rise. That is understandable: New South Wales is the only one of the large states in which there is any pent-up demand. Residential property prices have increased substantially over the past year. In August 2015 dwelling prices in the main capitals were 10.5 per cent higher than a year earlier. They were up 17.6 per cent in Sydney, 10.6 per cent in Melbourne, 3.9 per cent in Brisbane and 1.8 per cent in Adelaide. But prices were down 1.8 per cent in Perth. In the June quarter of 2015, interest rates fell again and the affordability of housing increased in all states and territories except New South Wales. The biggest increase, of 11.4 per cent, was in South Australia. Nationally, affordability rose by 1.9 per cent and was also 1.9 per cent greater than a year ago. Over the past three years national affordability has increased by 9 per cent and, over the past decade, by 7 per cent. But there is now an over-supply of housing in Australia, and consumer confidence remains weak. Work done on new housing will edge only slightly higher this year and is forecast to fall in 2016/17.
100 90 80 70 60 50 40 30 20 10 0 NSW
Vic
Years ended December
Qld
WA 2012
Tas
2013
NT
Trend values, at annual rate
70 60 50 40 30 20 10 0 Dec '12
Mar '13
Jun
Sep
Dec
NSW
Mar '14
Vic
Jun
Qld
Sep
SA
Dec
Mar '15
Jun
Sep
Source: ABS 8731.0
WA
Housing Affordability, Selected Australian States Ratio 4.4
Ratio of median family pre-tax income to average loan repayment More affordable Less affordable
4.0 3.6 3.2 2.8 2.4
Jun '12
Sep
Dec
Mar '13
Jun
Sep Vic
Qld
Dec SA
Mar '14 WA
Jun
Sep
Dec
Mar '15
Jun
Source: Adelaide Bank/REIA
value of work done, $ million, constant 2012/13 prices
NSW
VIC
QLD
SA
WA
TAS
NT
ACT
Australia
2012/13 (a)
10,651
13,906
7,347
1,837
5,906
468
542
1,280
41,937
2013/14 (a)
11,691
13,547
7,854
2,108
7,177
426
723
1,170
44,696
2014/15
13,359
15,088
8,903
2,396
7,798
586
627
1,219
49,997
2015/16
13,900
15,200
9,100
2,400
7,600
560
450
1,090
50,300
2016/17
14,100
13,980
8,500
2,350
7,200
550
440
1,050
48,170
2013/14
9.8
-2.6
6.9
14.7
21.5
-9.1
33.4
-8.6
6.6
2014/15
14.3
11.4
13.4
13.7
8.6
37.6
-13.3
4.2
11.9
2015/16
4.0
0.7
2.2
0.2
-2.5
-4.4
-28.2
-10.6
0.6
2016/17
1.4
-8.0
-6.6
-2.1
-5.3
-1.8
-2.2
-3.7
-4.2
% change
a = Actual
ACT
Source: ABS 3101.0
2014
Dwellings Approved, Selected Australian States
'000 80
NSW
New Housing Forecast: by State & Territory
SA
Average 2003-13
24
Consulting Matters Project case study
SMEC Case Study:
U2 on Waymouth, Adelaide U2 on Waymouth is a 25-storey mixed-use development which includes 255 residential apartments (ranging from one-bedroom studios to three bedroom penthouses), a rooftop resident’s area as well as commercial areas and parking spaces. At 78.6m high, U2 on Waymouth will be a dominant part of the Adelaide skyline, standing as one of the city’s tallest buildings. SMEC and the project team (JPE and BESTEC) was engaged by Runtong, a subsidiary of Datong Development and Investment Group to undertake the design of this project. The project team was split into three components; structural (SMEC), mechanical (BESTEC) and architectural (JPE) with additional consultants required for traffic and noise components. The detailed design was commissioned in October 2014, and delivered to deadline on 5 December 2014. As some elements of the structural design (including column layouts in the parking area and apartments and services vertical stacks) could not be completed without input from architects and services engineers, each component had to be simultaneously designed and coordinated. Throughout the design process, the project team collaborated to ensure each of their designs formed an integrated part of the overall design delivery, adhered to the building rules consent and produced a fit for purpose and cost effective solution for the client. The team utilised TEDDS, a structural design software, to enhance and speed up the design process. This software assisted with analysis, design and calculations which proved to be a major timesaver in preparing for building rules consent submission. The U2 on Waymouth project faced a unique structural challenge. As the residential apartments were housed on upper floors, parking garages on lower floors and commercial precincts on the ground floor, the column spacing had to be carefully considered. In order to reduce cost and construction timelines a structural system was selected to ensure no transfer slabs or beams were needed within the development. The structural system comprised a post tensioned flat slab system with rectangular columns and blade walls. An appropriate slab thickness and blade wall size was selected to ensure that punching design was optimised. This structural system also supported the north and south sides of the building,
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Consulting Matters Project case study
reducing deflections as the slabs are successfully used as horizontal cantilevering beams from the central staircase and lift cores. The flat slabs were optimised to the lowest possible height, allowing the interior fit-out to have flat bottom and top supports to further reduce costs. The successful implementation of this structural system ensured that the structural stability of the building was not compromised and all loads could be directly transferred into the soil structure. The project’s short program of a 39 day timeline was successfully met with a total of 84 drawings completed for the design of the landmark 25 storey building.
The team utilised TEDDS, a structural design software, to enhance and speed up the design process. This software assisted with analysis, design and calculations which proved to be a major timesaver in preparing for building rules consent submission.
Discussing the project, the Client commented “The team was very supportive of the client’s requirements and direction, the timely turn around for design and documentation was extremely pleasing from commencement up until Development Consent” Willem Van Metzinger SMEC
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Consulting Matters Industry comment
Introducing Arcadis We’ve recently announced that Hyder Consulting will now be known as Arcadis. It’s been almost a year since we were acquired by Arcadis and during that time we have been familiarizing ourselves with the larger Arcadis team and talking to our clients about what the change might mean to them. Although it’s a big change, it’s been coming for some time.
according to ENR ranked third in the world for engineering—we have maintained our local independence and local management team. Importantly, this allows us to make quick decisions for clients on the ground. Many of our clients say they appreciate this aspect about working with us, so it was great to be part of a bigger company but still have this ability.
Over the last few years Arcadis has added well known firms such as EC Harris, RTKL, Callison and Langdon Seah to its global stable- so it made sense to create one global brand. Together we can offer clients expertise across the world including engineering and design, cost management, project and program management, business advisory, architecture and water and environmental solutions.
The theme for Consulting Matters is ‘winning new business’. So, will a bigger global team necessarily equal winning more work?
The good thing for me is that although Hyder is now part of a much bigger organisation—
The big difference perhaps now will be that in being part of Arcadis we can now call upon
In my opinion winning work with clients is about delivering on your promise to them and exceeding their expectations. That’s always been our approach in Australia for over 70 years, and that focus will not be changing any time soon.
a larger group of global colleagues to call on to help solve client problems. Whether the flood defenses in New York and New Orleans can be applied to the Brisbane and Sydney coastlines, or the specialist tunneling skills of the Metro de Santiago in Chile can be adapted to the likes of the Forest field Airport Link in Perth - we can tap into a wider network and share that knowledge with our clients to meet their needs. Greg Steele CEO Arcadis Australia Pacific
Registration the answer to winning new business Times are tough for engineers. Mining is slowing down and potential new projects have stalled, meanwhile major infrastructure projects are few and far between, particularly in Queensland. Winning new business has therefore become highly competitive amongst individuals and engineering firms. Being registered as an engineer (RPEQ) is a legal requirement in Queensland or when providing an engineering service for Queensland; the alternative is for an unregistered engineer to be supervised by an RPEQ. Far from simply being a legal requirement, I’ve often argued that gaining RPEQ status is highly beneficial for career development, building one’s reputation and creating employment opportunities. Several RPEQs with major engineering, construction or mining companies tell us that having that status has allowed them to progress in their chosen field; taking on
supervisory or management roles. RPEQ status also allows greater flexibility in that RPEQs themselves do not need supervision, they can focus on private consultancy, and they can be designated to other projects or operations as necessary. When it comes to winning new business reputation can be everything. To earn RPEQ status an engineer must undertake years of vigorous study, and work professionally for a number of years to gain the right experience; then satisfy the Board and professional assessment entities of their qualification, competency and experience; all the while building themselves a reputation. The Board currently registers approximately 3,000 interstate or overseas engineers. Not all of these engineers regularly carry out engineering services in Queensland or for Queensland, yet they choose to maintain their RPEQ status for the professional credibility it affords.
A quick search for engineering vacancies on SEEK will reveal the vast majority of Queensland employers specify the need for applicants to be ‘an RPEQ’, ‘registered’ or ‘professionally accredited’ in order to meet job requirements. Immediately, an engineer who is registered will have a leg up on other potential applicants. Even some interstate employers are mentioning RPEQ status as being beneficial when advertising vacancies. Despite the difficulties there are simple steps we can take to benefit ourselves in the job market, particularly, becoming an RPEQ. This ensures you are fulfilling your legal requirements and puts you in the best position to win new business. Dawson Wilkie Chairman - The Board of Professional Engineers of Queensland
What do you think is the most pressing issue our industry is facing? Submit an industry comment to Consulting Matters today. Send your comment to our Editor (max 200 words) at kisanne@consultaustralia.com.au.
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CONSULT AUSTRALIA IS ON YOUR SIDE
Consult Australia believes that it is important to support members in all aspects of their business. We also recognise the impact that the insurance market has on Consult Australia member firms in terms of availability, affordability and quality of Professional Indemnity insurance.
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Consult Australia’s PI Insurance Pathway gives Consult Australia members access to the PI market through a Panel of Brokers selected by Consult Australia. Consult Australia is providing a referral service only and is not providing any form of financial advice or offering a financial product. Consult Australia does not guarantee the value, price and terms of cover that may be received from any member of the Panel of Brokers. Any agreement entered into through use of the PI Insurance Pathway will be expressly between the Panel Broker and the Consult Australia member firm.
March 2015
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Open courses and in-house training available!
Thinking about professional development? Consult Australia offers a number of intensive training programs to provide consultants with invaluable skills, knowledge and advice. This powerful training puts you in control and allows you to better protect your business. Please see the website for dates and further information.
Learn vital information about:
2015 dates: QLD: 19-20 Nov WA: 19-20 Oct
Contracts for Consultants Learn vital information about:
• Designer duties under current legislation
• Contract formulation & terms
• Hazard identification tools
• Contractual relationships
• Risk assessment, control, and management
• Liability & Insurance
• Safety in design procedures and documentation
• Professional indemnity insurance
• Onerous contract terms • Dispute resolution
• Best practice examples
Facilitated by Tony Horan - one of the most knowledgeable and experienced barristers working in the construction industry in Australia.
• Includes the Safety in Design Tool Kit
Member Price: $1,800 Non-Member Price: $2,680
The Role of the Superintendent Topics include: • Scope of duties
Member Price: $2,900 Non-Member Price: $3,200
2015 dates: VIC: 28 Oct QLD: 11 Nov WA: 25 Nov
• The dual roles of the Superintendent • Decision making and conveying information • Liability of the Superintendent • Insurance issues Facilitated by Tony Horan - one of the most knowledgeable and experienced barristers working in the construction industry in Australia.
Member Price: $1,300 Non-Member Price: $1,550
2015 dates: QLD: 12-14 Nov VIC: 19-21 Nov WA: 26-28 Nov
ALL courses are now available in-house! All courses are also available in-house. For more information, visit www.consultaustralia.com.au or contact Consult Australia on 02 9922 4711 or education@consultaustralia.com.au http://bit.ly/caeducation Sept 2015
Safety in Design