Learning legacyLessons learned from the London 2012 Games construction project

Figure 1: The ODA Balanced Scorecard

Sustainable procurement The Olympic Delivery Authority (ODA) used procurement to enable delivery of its policy objectives and ambitions such as sustainability, equality and inclusion, and health and safety. These were defined in a balanced scorecard against which all bidders were tested throughout the procurement process, and policy objectives and reporting regimes were built into the resulting contracts. To support this activity, specialist resources were required in each policy area, as well as an eProcurement system and methodology, particularly an evaluation system.

Sustainable procurement aims and objectives London’s successful bid to stage the Olympic and Paralympic Games in 2012 included a range of obligations including the staging of the Games themselves. Key stakeholders also attached a wide range of collateral ambitions for the ODA to achieve. Following a consultation process, including a series of board-level workshops, the set of key objectives set out in Figure 1 were adopted.

These objectives form part of the ODA’s Balanced Scorecard, which was applied to all ODA and Tier One procurements.

Balanced Scorecard In general, a balanced scorecard describes an evaluation approach where ‘hard’ criteria, such as cost, are ‘balanced’ by the evaluation of ‘soft’ criteria such as sustainability. The ODA applied its Balanced Scorecard to all its procurements, by using different elements of the Scorecard at different points in the procurement procedure, and in the process applying both traditional (for example, cost, time, quality) and progressive (for example, equality and inclusion, and legacy) criteria as shown in Figure 1.

Implementation Adapted to suit procurement stage and type The ODA’s default procurement route was the EU Restricted procedure,

which includes two stages: a Pre-Qualification Questionnaire (PQQ) which tests bidders experience and results in a shortlist of capable bidders who are invited to tender (ITT). Figure 2 shows how the balanced scorecard was applied across these two stages.

This approach was applied to all the ODA’s procurements that exceeded the Official Journal of the European Union (OJEU) threshold across the ODA’s construction and engineering, logistics and corporate procurements,

with the questions being tailored to suit the procurement concerned. For example, the ODA’s employment and skills requirements such as the percentage of the workforce to be apprentices were different on works and services contracts.

Managing the impact on the supply chainInitially, bidders who had previously experienced these types of wider objectives and related questions may have had some advantage, however this decreased over time as the market

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became used to the ODA’s requirements. Concerns that Small and Medium sized Enterprises (SMEs) would be disadvantaged and deterred from bidding were mitigated by using the CompeteFor system.

CompeteFor required bidders to demonstrate that they were ‘Business Ready’, by producing a range of corporate policies such as sustainability, and equality and inclusion, before they could access the system. Where businesses were not ready, they were referred to local business support agencies that helped them develop the required policies. This testing and support process conditioned SMEs to the ODA’s wider objectives.

Implications Resource requirementsCommitting to a range of objectives required high levels of resources to lead progress against the objectives, and in particular to assess bidder’s submissions in the policy areas and monitor contractors’ subsequent performance in these areas.

The ODA established specialist assurance teams consisting of at least five members for each policy area, such as health and safety, equality and inclusion, and sustainability. These teams were also mirrored in the ODA’s delivery partner and together this gives a view of the scale of resources required to support the delivery of progressive objectives.

Procurement process complexityThe use of multiple teams of evaluators in different locations, brought additional complexity to the procurement process. The evaluators needed to conduct their evaluations simultaneously in order to meet the time constraints of the programme. To enable this, and to provide an auditable and secure record of decision making, the ODA used a web-based eEvaluation system, which enabled simultaneous on-line evaluation. The wider implication was that to support eEvaluation, a further system was required (eProcurement) to send and receive tenders electronically,

and the procurement methodology had to be developed and implemented to support these systems.

Lessons learned The ODA demonstrated that procurement can be used to enable the delivery of policy objectives, by: – testing bidders in these policy areas

during the procurement process – building their proposals into the

subsequent contracts – monitoring contractual performance

in all of these areas

To do this, specialist resources are required to support each policy area, which may amount to a significant resource commitment over the breadth of an organisation’s objectives. Specialist procurement evaluation software is also required to enable specialists from each of these policy areas to be evaluating bidder responses simultaneously.

Selection Criteria

Meat/Vfm

Commercial Evaluation

Technical Evaluation

Price

Financial Profile and Insurance

Quality and

Functionality

Project Delivery

Experience and

Capability

Governance

PQQ ITT Balanced Scorecard

� Cost

� Cost & On Time

� Environment Quality and Functionality Legacy

� On Time Supply Chain

� � All 7 Objectives of the Balanced Scorecard

� � Safe & Secure, Equalities and Inclusion, Supply Chain, Employment

ProjectProgramme Wide Procurement

AuthorJohn Fernau – Deputy Head of Procurement, ODA

© 2011 Olympic Delivery Authority. The official Emblems of the London 2012 Games are © London Organising Committee of the Olympic Games and Paralympic Games Limited (LOCOG) 2007. All rights reserved.

The construction of the venues and infrastructure of the London 2012 Games is funded by the National Lottery through the Olympic Lottery Distributor, the Department for Culture, Media and Sport, the Mayor of London and the London Development Agency.

For more information visit: london2012.com/learninglegacy Published October 2011

Figure 2: Applying the Balanced Scorecard

ODA 2010/374