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Alliance model was the key to success in building the Lakeside Road Tunnel in Tampere
Published on 09 March 2020
Finland
Länsi-Suomi
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About this good practice
The construction site of the Lakeside Tunnel is crucially sited in the middle of the industrial city, underneath old buildings, roads, a railway and a river link. The central section dives into a large tunnel over 2. km and there are partially underground interchanges and ramps excavated at each end.
The alliance was created and set up with a chosen contractor before the target price for the job was agreed. In the beginning there was a competitive process with the contractors with assessment on a series of criteria according to technical ability, the nature of the resources and the team they will bring to the project. In the Lakeside Road tunnel this started with a five-way competitive process, narrowed down to two and eventually the final consortium was selected.
In the project the contractor and designers worked together in an "alliancing" scheme, a system imported from Australia and one of the first major uses of the method in Europe.
The alliance team worked through the detail design process for several months before the project began on the ground, particularly to pin down all the risk elements rather than oblige the contractor to price them into the contract with all the possibilities for claims and conflicts. The alliance shared the risks of the project using agreed pain-gain formulas. In practice, this meant that cost overruns or schedule and cost savings produced a penalty or benefit for both the client and the contractor.
The alliance was created and set up with a chosen contractor before the target price for the job was agreed. In the beginning there was a competitive process with the contractors with assessment on a series of criteria according to technical ability, the nature of the resources and the team they will bring to the project. In the Lakeside Road tunnel this started with a five-way competitive process, narrowed down to two and eventually the final consortium was selected.
In the project the contractor and designers worked together in an "alliancing" scheme, a system imported from Australia and one of the first major uses of the method in Europe.
The alliance team worked through the detail design process for several months before the project began on the ground, particularly to pin down all the risk elements rather than oblige the contractor to price them into the contract with all the possibilities for claims and conflicts. The alliance shared the risks of the project using agreed pain-gain formulas. In practice, this meant that cost overruns or schedule and cost savings produced a penalty or benefit for both the client and the contractor.
Resources needed
- the total target cost estimation was 185 M€
- approximately 1000 man-years needed
- 5 partners in the alliance
The core team of the alliance represented high-level skills and know-how and the needed competencies were acquired throughout the project.
- approximately 1000 man-years needed
- 5 partners in the alliance
The core team of the alliance represented high-level skills and know-how and the needed competencies were acquired throughout the project.
Evidence of success
During the project and due to the alliance model, over 140 innovations were created during the process. The innovations were related e.g. to safety and construction solutions. The innovations caused major savings, approx. 20 M€, throughout the project. The project was finished six months earlier than it was estimated in the beginning.
The project received The Best Project Award at IPMA Global Awards (-18), Finnish Association of Civil Engineers RIL Award (-16) and IPMA Finland Award (-17).
The project received The Best Project Award at IPMA Global Awards (-18), Finnish Association of Civil Engineers RIL Award (-16) and IPMA Finland Award (-17).
Potential for learning or transfer
Due to the great experiences of alliance model, the City of Tampere has utilized the model also in other projects, e.g. in tramway construction. Also Tesoma Welfare Centre was built by using the alliance model. The Lakeside Tunnel alliance has shown how the alliances can be created by following the national procurement rules. The experiences of alliance model has been spread actively inside the city organisation. The greatest learning is related to different operation models such as Big Room method, Target Value Design and fostering open management and organisation culture. The Lakeside Tunnel project has encouraged several public sector organisations to test the model in their own projects.
Further information
Website
Good practice owner
You can contact the good practice owner below for more detailed information.
Organisation
City of Tampere
Finland
Länsi-Suomi
Contact
Senior Specialist, International Projects and Financing