Babcock has achieved a score of 90% in the two year review of
the four year Warship Support Modernisation Initiative (WSMI)
partnering agreement between Babcock and the Ministry of Defence
(MoD) at Devonport. The review findings demonstrate Babcock's
ability to work successfully with the MoD not only in being on
track to deliver the £67 million savings committed to but also,
importantly, while continuing to achieve a strong performance
across a wide range of initiatives and key service areas at the
same time.
Under the latest WSMI agreement, signed in 2009, Babcock
provides engineering support to the fleet, both ships and
submarines; waterfront support services; logistics services;
transport and estate facilities management at HM Naval Base,
Devonport.
The two year review was based on ten agreed criteria, against
which Babcock was scored as either 'under-performing', 'normal
performance' or 'out-performing', with associated scores of zero,
two or four points respectively. Babcock achieved a total score of
36 points ('out-performing' on almost all fronts), equating to
90%.
The ten criteria were used to monitor performance across a broad
range of areas, five of which could be clearly measured with
numerical data, while others were more subjective. Babcock's
progress in fulfilling the criteria has been monitored via
six-monthly meetings between Babcock and the MoD, where joint
evaluations have taken place to determine progress being made.
Performance against savings targets was one of the key criteria,
and has been strong. Enduring savings of over £30 million have been
achieved, putting Babcock on target to exceed the £67 million
savings sold-forward under the WSMI agreement.
Also among the ten criteria was co-ordination with wider
maritime initiatives under the Maritime Change Programme, with a
view to ensuring full engagement and interaction with emerging
initiatives such as Class Output Management, and Flotilla Output
Management. A notable achievement under this heading has been the
introduction into the WSMI agreement of an element of the Fleet
time maintenance fee being placed at risk against the availability
targets for Trafalgar class submarines, in a 'Contracting for
Availability' approach. This, alongside the Continuous Engineering
Support (CES) arrangement for the long-term support of Landing
Craft also incorporated into the WSMI agreement a few months
previously, demonstrates the provision of flexible support to the
transformation agenda under the WSMI agreement.
Another of the criteria covered make or buy decisions, seeking
greater visibility of Babcock's supply chain activities, in
recognition of the need to demonstrate robust processes for make or
buy decisions, and effective tier 2 supplier management. This has
been successfully delivered, with a major review by Babcock of its
make or buy decisions leading to planned changes in the provision
of services for estates and logistics.
The remaining criteria included: Key Performance Indicator (KPI)
performance (looking to see strong performance across all areas of
activity, including relationship development, despite significant
cost savings being made); Key supplier performance review (looking
for continuing improvement in Babcock's annual performance review
scores); Move to co-locate in a new Naval Base headquarters (a key
element in furthering the partnering approach); Company asset
investment plans (looking for greater visibility); Energy
management targets (looking for a reduction in energy usage to aid
cost reduction and support government environmental targets);
Development of key processes and business cases (looking to drive
progress on a range of initiatives); and Introduction of a New
Works KPI for programme performance (looking to bolster new works
activities).
Commenting on the demonstrable success achieved at this 'half
way point' in the latest WSMI agreement, Babcock Managing Director
Devonport, Phil Jones, said: "We are delighted to be classed as
'out-performing' against the wide ranging review criteria. In
particular we are proud to be able to demonstrate our ability to
deliver the substantial required savings - a challenge in itself -
while still maintaining a strong performance across all areas of
the WSMI agreement. This puts us on a strong footing for working
with the MoD to develop the WSMI successor contract to take effect
from 2013.