Professor Ivory (pictured), Deputy Director of the Institute for International Management Practice, has co-authored Managing Complex Projects: Networks, Knowledge and Innovation (Routledge) with Dr Roger Vaughan and Dr Neil Alderman (both Newcastle University) and Professor Ian McLoughlin (Monash University).
The book is based around three case studies covering ‘trains, cranes and drains’: Alstom Transport’s supply of the West Coast mainline tilting trains; a major Rolls-Royce materials handing project in Argentina; and a sludge processing plant built by Northumbria Water.
Until recently, manufacturers of large capital goods responded to a detailed specification from a client, handed over the finished equipment and then withdrew. However, nowadays a new breed of commercially-driven clients demand that manufacturers provide services rather than products.
These services are often complex systems and networks that require vigilant project management. And no longer does the client shoulder the risk that comes with owning and operating capital equipment – instead the manufacturer often takes on those risks, which can be considerable.
Professor Ivory said: “As demand has changed many leading manufacturers, such as Rolls-Royce and the train builder Alstom Transport, have transformed themselves into service providers. This can involve financing, maintenance arms offering guaranteed levels of reliability, facilities management and even disposal services.
“Service-led projects are also inherently contradictory. If the manufacturer has to maintain the equipment at its own cost for the length of the contract, then it’s logical for them to build reliable, easy-to-maintain equipment at a higher initial cost. This is obviously different to building equipment that is merely fit for purpose at the point of hand-over.
“It has also transformed the nature of project management. Lead contractors must hold together more complex and diverse consortiums, many of which may not be in their direct control.
“A well-planned and well-executed project may deliver a reliable profit to a manufacturer over a contract life spanning perhaps 15 years, while a poorly-planned one may just as easily constitute a stream of debt over the same period.”
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For more press information please contact:
Jon Green on t: 0845 196 4717, e: jon.green@anglia.ac.uk
Jamie Forsyth on t: 0845 196 4716, e: Jamie.forsyth@anglia.ac.uk
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The complex world of trains, cranes and drains
7 April 2014
Anglia Ruskin University's Professor Chris Ivory is shining a light on the complex world of modern big business in a new book which examines how manufacturers have shifted from providing traditional products to a more complex array of services.