Collaborative Business Relationships Case Study
Security and Estate Group
Point Wilson Wharf Infrastructure Remediation Project
A greenfield journey into capability development using principles of high performing relationships
A Report Authored by Dr Robert Holmes
Introduction
On 23 October 2023 the Acting Prime Minister and Minister for Defence Richard Marles reopened the Point Wilson Pier. The Pier, or jetty was constructed in 1961 and is 2.4km long, making it the second longest in the Southern hemisphere. Landside, the pier is joined to 168 metre wharf capable of accommodating explosive ordnance vessels. This wharf is a centrally important piece of infrastructure for the country because it has been dedicated to both the import and export of explosive ordnance and dangerous goods, much of which is manufactured or stored in regional Victoria and beyond.
Between 2008 and 2019 the pier was closed because it needed to be remediated – rebuilt and restructured. During those years an alternate facility was used through Port Alma at Rockhampton. This created significant logistical issues and cost overburden. The works took four years and is a story of collaboration, not only between the three industry partners tasked with restoring the wharf and its environs but also between them and Defence. Once operational it also has the potential to be a dual use facility for Defence and other import/export agents requiring access from Geelong to Melbourne.
This is also a story of future resourcing and supply and enhancing sovereign capability. According to Marles, “The [reopening] is really important in terms of the guided weapons and explosive ordnance enterprise that the government has put in place as one of the key priorities, which comes out of the Defence Strategic Review. We need to be manufacturing our own guided weapons in Australia, and that is a very important part of Defence Strategic Review, a very important part of the government’s response to it.”
Project background
The Department of Defence put in place a plan to upgrade the Point Wilson Facility near Geelong in 2009 under the then Federal Labor Government. They put the remediation of the wharf to tender, and the winning joint venture (Aurecon-Thales-CBP) set about planning the reconstruction of this important facility.
In the intervening ten year period, as a result of changing government priorities and misalignment of State and Federal objectives, the delivery team that won the contract were set to disband. Priorities and budgets had changed, and the delivery team were not prepared for Parliamentary Standing Committee on Public Works (PWC) approval or start up. Defence was sceptical based on past performance of some alliance partners, and there were rumours of legal, contractual negotiations getting underway.
The project team needed to be regathered, re-energised and put onto the task. All talk of legal action needed to be set aside and deep agreement between parties was required rapidly in order to get the newly funded project underway. Defence asked a team well versed in collaborative business relationships, and the international standard (ISO 44001) to restart the delivery alliance. This would mean bringing together the disparate layers of organisation (Aurecon, Thales, CBP and Defence) to establish a project charter. This charter would bring the project team up to date with developments and prepare them for when the PWC approved the project.
The approach
The collaboration team started with wide reaching and high level stakeholder engagement. It was important to hear where each company and each leader stood, what their grievances were and how they might work together to resolve them. 20+ leaders across the four parties involved were interviewed, genuinely listened to and asked for their input in designing a series of workshops to enable agreement to be reached.
The main issues raised and agreed by all were:
- Erosion of trust (because of delay),
- Contractual changes (because of the shifting budget and new governments),
- Communication (which had become missive and aggressive),
- Lack of agreement around strategic intent.
In addition, the facilities management team (Thales) had a variety of practical site access and safety issues. These involved not only the logistics of loading and unloading, but restricting site access, nearby commercial warehousing facilities and industrial action with unions. The delivery team (CBR) and project management (Aurecon) needed to realign with Defence priorities and re-establish trust with the Commonwealth.
The collaboration team then set about writing the executive briefing, designing the team building and alignment to restore trust and synthesised disparate information so that each party could agree on it. The first and most important activity would be a large, in person, co-facilitated all day workshop with senior executives and stakeholders from nationwide.
This workshop resulted in all parties agreeing on:
- The strategic vision for the wharf,
- The values the four organisations shared on the project,
- The behaviours they expected from one another,
- How decisions would be made during the project.
The result was creating a Foundational Charter, signed by all key decision makers, and those who attended the one day offsite. This document was an important, public commitment to principles of collaboration, building trust and how the teams would work together. It was referred to whenever difficulties arose, and when agreement could not be reached. According to social science and neurology research, making public commitments increases follow through by between 74 and 92%.[1] This case study certainly shows that to be true.
Measuring success
After the foundations charter workshop, the team agreed to pursue the deployment of the contract. The three companies got back on track and worked collaboratively to deliver the result. As you saw from the introduction, they came through and the Point Wilson Wharf has now been reopened. It was delayed by the onset of COVID, which disrupted business, construction and commercial operations in Victoria. Between the end of March 2020 and October 2021, Victoria was in lockdown for 262 working days – or effectively one year. Despite this, the project was delivered only 9 months late, so effectively the delivery team gained 3 months against available working days.
It is also a story of commercial savings being gained through collaboration. The original PWC budget was $330M. When reworked in 2019 the budget was set back to $203M. According to LTGEN JJ Frewen on the day of its reopening, the wharf project came in on time, delayed only by 9 months (due to COVID) and $10M under budget.[2]
Gains extended beyond time and cost. The quality of the remediation, “Brought the wharf back to pristine condition” said CDRE James Nash at the opening in October 2023. This work proceeded without becoming ensnared in environmental action because of extensive collaboration with National Parks and Wildlife, the Environmental Protection Agency, VIC and the Australian Maritime Safety Authority, all of whom had vested interests in the marine life and impact of public works in the harbour.
Lessons learned
During this four-year development project, it was clear to the key leaders that the original contract language was part of what got them into trouble in the first place. A “contractor” view of doing work resulted in each party working for their own gain, their own outcomes and the avoidance of recrimination from the Defence Security and Estate Group. It cannot support the intent of a relationship, and friction occurs whenever one partner “gains” at the other partner’s expense.
This misalignment can be felt, even when the project team itself collaborates, and shows up in other parts of the supply chain, in the risk management team or in procurement (contract management). This misalignment creates a risk that the contract could be used to the detriment of the whole enterprise.
The Project Control Group, the governing body represented by all four parties, followed the existing contractual guidelines, but not in an adversarial manner. They realised that “You don’t need a contract when you have a relationship.” While adopting relational contracting practices can yield tremendous results, the results are only as strong as the leaders and their willingness to follow the behaviours outlined in the Foundational Charter.
About the author
Dr Robert Holmes is the Senior Director of Consulting at Providence. He is an expert in human behaviour, transformational consulting and change management. His career spans work with federal and state government, large public firms and for purpose entities. His focus is on strategic advice, delivered through practical solutions that solve complex problems. He is an active member of the communities of practice for behavioural insights, neurodiversity, coaching and change management.
[1] Cioffi, D., & Garner, R. (1996). On Doing the Decision: Effects of Active versus Passive Choice on Commitment and Self-Perception. Personality and Social Psychology Bulletin, 22(2), 133-147.
