In late 2008 and early 2009, representatives from the Victorian Department of Treasury and Finance undertook a fact-finding mission on alliancing as a delivery method in Australia. Around 40 organisations were visited throughout Victoria, New South Wales, Queensland, and Western Australia, and covered:
• line agencies (Owners)
• constructors and designers (Non-Owner Participants)
• lawyers
• alliance facilitators.
The representatives from the Victorian Department of Treasury and Finance provided the Research Team with the following key themes and anecdotes collected from their mission:
• Alliancing as a procurement strategy provides a demonstrable value proposition for the private sector's commercial objectives.
• Agencies have not provided hard evidence that alliancing generally does provide demonstrable VfM for the public sector against other procurement alternatives.
• There is a possible imbalance in the value proposition for alliancing.
• It is acknowledged that generally a higher level of capability in an individual is required to deliver good to very good results within an alliance in comparison to hard dollar contracts.
• Some agencies are well resourced and work hard and plan smart to get the best result for the project, however, it is also common for alliances to either not have Owner representatives or to have representatives that are not sufficiently experienced for the role (i.e. there is an asymmetry of capability in comparison to the NOPs).
• There is a perceived resource paradox around alliancing; alliancing is often used because the agency lacks the resources to manage a non-alliance procurement strategy, yet there is also recognition that the agency needs highly capable resources for it to effectively engage in alliances.
• The DTF Alliance Practitioners' Guide is a good resource, but lacks the practicality to bridge the capability gap ("public officials are good at contract administration not necessarily at contracting").
• Further development is necessary in the selection criteria leading to the selection of alliancing as a procurement method.
• Tight timeframes and public sector resource restrictions are often cited as reasons for using the alliancing delivery method.
• If we can't understand what the project is about (scope/cost/risk/etc) then it should be an alliance (a theme).
• "I have never advised a client that a specific project should not be an alliance" (an Alliance Facilitator).
• In some sectors (e.g. water), it appears alliancing has become the default delivery mechanism.
• Alliancing is sometimes selected before the project is selected (as in program alliances)
• The role of the independent estimator is seen as problematic if they are only reviewing rates, and not scope.
The Research Team was advised that these varied and mixed views were one of the catalysts for this Study.