Client Activity:

National Rail Network

Headline:

Savings of £10.7 million

Background:

The organisation is investing heavily in track replacement, which is largely sub – contracted to a number of engineering companies, but managed from within.

The work is known to be expensive but the internal accounting system is so disparate that an overall and accurate costing is not known until the books are closed and final accounts published some time after the event.

Effective near real time cost control has proved to be almost impossible under these circumstances with the effect that there was little, if any, accountability and no engagement from within the business.

Action:

Development of an over arching metric and getting the component parts of the operation to understand how they contribute to the metric was the key challenge.
With replacement cost per yard calculated at £197 from the recently closed accounts, it was a relatively simple task to determine the contribution to that cost, of each group.

Result:

- Individual and group accountability
- Leaders started to address actual obstacles
- Engagement from within the business to promote ‘can do’ attitude
- Opportunity to work with tangible figures improved project focus
- Individual contributions made it easier to justify streamlining work processes
- Communication improved between teams

In the last three full years, cost per yard reduced from £197 to £179 to £156.
Final year savings amounted to £10.7 million.