Olympic challenge for logisticians

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The 15 volumes contain the plans for new sporting venues, highways, bridges, river works, utilities, parks, open spaces and how they will be converted for community use after the London games. The application covers an area of more than 600 acres. It is reckoned to be one of the largest planning applications in European history.

And it promises to create one of the biggest logistics challenges ever.

The complexity of the Olympic plan is highlighted by the fact that there are three organisations letting contracts for the work.

The Olympic Delivery Authority (ODA) will let the majority of the contracts for the infrastructure, transport and construction of the Olympic Park. The London Organising Committee of the Olympic Games (LOCOG) will let most contracts for services to deliver and stage the games. The committee’s procurement will focus on the needs of the games themselves so will cover goods and services from sports equipment to catering. These contracts will be let from 2009 onward. The London 2012 Organising Committee will manage its procurement separately from the ODA. Depending upon the nature of the goods and services required, The London 2012 Organising Committee will either contact potential suppliers directly or undergo an open tender process.

In addition, the London Development Agency (LDA) will let contracts enabling work such as demolition, remediation and bulk earthworks.

Over the course of 2007 the Olympic Delivery Authority expects let five contracts to support the construction activities.

Already contracts are being let for the development. In the first, agreed last month, Australian developer Lend Lease has been selected by London & Continental Railways and the Olympic Delivery Authority as preferred development partner for Zones 2-7 of Stratford City, including the 2012 Olympic Village.

Stratford City is currently 73 hectares of former railway marshalling yards making it one of the largest and most significant urban regeneration zones in Europe.

Under the terms of the proposed agreement, Lend Lease will develop the site in two phases. Phase One, which has an estimated value of £2 billion involves the development of approximately 4,200 residential dwellings and related accommodation that will become the village for the games. It is anticipated that under the proposed agreement Phase Two will involve the Lend Lease team refurbishing the Olympic Village following the completion of the 2012 Games, and also developing up to another 500,000 square metres of space to complete the regeneration of this area of Stratford City. This phase has a potential value of around £3.5 billion assuming development over the period to 2020.

However, it is easy to get carried away by the excitement of such a large and prestigious project and simply overlook the pitfalls.

The problems faced by the logisticians involved in preparations for the 2004 Athens Olympics were highlighted by Evangelos Angeletopoulos, managing director, and Andreas Pastroumas, operations director of the Logistics 04 Consortium – the logistics operation for the 2004 Athens Olympics.

Writing in our sister magazine “Logistics Europe” in September 2005, they said: “Everybody focused on the sports department and paid less attention to operational departments and issues. Functional planning was not at the required detailed level. The result was that logistical system customers submitted their requirements without the necessary standard planning.

“Delays in material deliveries by contractors, inadequate items descriptions and coding, differentiation in physical inventory quantities and units of issue (from what was posted in the asset tracking system), lack of materials pre-allocation to venues, inadequate knowledge of FA’s personnel in logistics processes and procedure, venues re-supply with consumables during the first days of the games, were just some of the problems to be solved by the logistics.”

David Hindson, TDG’s marketing and strategy supremo, points out that research has shown that effective organisation of logistics to a construction site can cut construction time by up to 20 per cent and reduce costs by 10 to 15 per cent. He points out that getting materials to the right place at the right time is not easy on a large construction site. And even if materials are delivered to a point that is only 50 years from where they are supposed to be, the building contractor will have to waste time trying to find them before starting work. Delivering to exactly the right place can result in big savings.

Hindson favours a technique akin to the sequencing systems used in the motor industry where goods are consolidated at a purpose designed site and then delivered to the assembly line on a just-in-time basis. It is easy to see the value of such a scheme at the Olympic site where huge quantities of materials are going to be needed for different projects across the huge site.

Such a system has been used at Heathrow Terminal 5. Construction industry journal “New Civil Engineer” described the logistics of keeping the 250 contractors at the site supplied as “more challenging than the purely technical task of constructing BAA’s new £3.75m terminal complex”.

Two consolidation centres were created to provide a local buffer for raw materials, reducing the storage time for concrete materials from three weeks to three days. The Colnbrook Logistics Centre and Heathrow South Logistics Centre were used to prefabricate reinforcement cages in a safer environment, ready for use on site.

Clearly the Olympic Delivery Authority needs to think very carefully about its approach to supply chain management for the project. David Higgins, chief executive of the authority, said: “We want to learn from the best in their class, eg, the work that is happening on Heathrow Terminal 5, work that the MoD is carrying out around the country. These are world leaders in procurement and we want to tap into that was well as the major private sector organisations that use supply chain management.”

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