1. Reducing Costs and Improving Results for Refurbishments Shaun Aldis Director of Property Services

2. Context 3 Partners £410m over 5 Year’s (currently in year 3) Circa 24,000 occupied properties Scope of works: Kitchens, bathrooms, central heating, electrical rewires, external improvements including insulation and combination of the above to high rise

3. Challenge Shortfall in delivery £47m* Local employment (highest in West Midlands) High expectations: promises made Huge mobilisation 750 employed on contract excluding supply chain Is there comparity between the three partners on the triple bottom line? What is the true cost of delivery? Management of the day to day cost activity? Would you spend your money this way?

4. KEY PHASES OF PARTNERSHIP PHASE 3 HIGH STRATEGIC VALUE PHASE 1 DELIVERY PHASE 2 ADDED VALUE TRUST TIME

5. What did we do? Efficiency Programme Strategic Overview Bottom up: Think - Plan - Do Vision for the future ~let your imagination run away Don’t focus too hard and predict the outcome Christopher Chabris and Daniel Simons (1999) perception test Avoid dramatic change Health Check Understand your base line Sweat the details ~succession/scenario planning Keep it real ~ challenge Where do you need to be?

6. Efficiency programme Health Check Findings Reasonable cost comparators Varying costs between each partner Varying costs from supply chain for the same product Component frequency replacement Inward investment Refusal rate Delivery model to accommodate PRADA

7. Courtesy of Chartered Management Institute

8. Lead from the top Developed cash flow forecasting model Shared outcome and cashable efficiencies Cost/value reconciliation for each partner: OBCM, Full supply chain integration, KPI incentivisation Review material specifications and guarantees Consistency review, frequency replacement and quality Introduced ‘lean’ Improve customer satisfaction Incentivised what matters Efficiency programme Action

9. Efficiency programme Outcomes 20% overall savings by each CP through lessons learned and best practice sharing across the partnership Adoption of target cost mechanism and KPI incentivisation on gain share, led to improvements Total TSQ’s rose from 94% to 98% Incentivised local employment (increase from 22% to 32%) Rigorous application of lean techniques to reduce time in property (properties completed in less than 25 days moving from 88% to 97% across partnership) Reduced number of days in property from 25 to 15

10. Efficiency programme Outcomes Equal vigilance in reviewing the in-house structure for managing the DH programme has resulted in WH commissioning costs running at 2.7% of total costs within top quartile performance of 3% Partnership is applying the WH ‘Refusal Protocol’ robustly and refusals are currently running at 6% Continued Director level involvement in integrating supply chain “CWC UK – keenest prices seen nationally” Some of efficiency savings have been absorbed by introduction of enhanced improvement justified on basis of reduced whole life costings e.g. rewire versus partial rewire

11. Efficiency programme Outcomes Following consistency review: improved scope of survey reliability has seen more efficient delivery being achieved with preliminaries as low as 8.8% Materials management reviews have led to cost reductions between 20% and 35% Reduced snagging Improved information to tenants Improved knowledge on stock ~no surprises

12. What next? Ice Berg Effect

13. Questions Shaun Aldis Director of Property Services Wolverhampton Homes shaun.aldis@wolverhamptonhomes.org.uk