BAA

Commercial Recovery

Overview

The Orange Partnership was appointed by BAA to initiate a Commercial Recovery Plan, during the final year of construction of Terminal 5. As a result of our actions over £60m was returned back to the project.

BAA’s Terminal 5 Project has been one of the largest UK construction projects of modern times. The project was successfully delivered on time and on budget but, as with any major project, it was not without its cost pressures.

Actions

The Orange Partnership drove the commercial recovery strategy, based on a detailed review of the contract and operational/supplier performance. All was within the confines of a programme reaching £4.5bn in budgets.

We formulated a detailed risk based plan pin-pointing areas to be investigated in further detail. These investigations revolved around key audit skills (including The Orange Partnership Forensic Cost Verification) as well as commercial challenges led by BAA’s Cost Consultants.

Results

Within a 12 month schedule our work was fundamental in returning over £60m back to the project.

Commercial Recovery by its nature is a complex and sensitive issue. Through our pragmatic approach not only did we manage to recover significant funds for our client, we also retained harmony with its Supply Chain.

Following on from this success, we were further commissioned by BAA Group to conduct supplier specific Commercial Audits on its Construction Supply Chain. The remit of these audits was to assure BAA that it had obtained value for money through its supply arrangements and that post contract management activities had been properly complied with.

These subsequent Commercial Audits recovered over £3.2m for BAA. This was effectively all historical ‘cash’ back. This assignment paid for itself over 15 times.

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