Getting to grips with infrastructure - Supply Management

Getting to grips with infrastructure

David Noble, Group CEO, Chartered Institute of Procurement & Supply
19 February 2016

The announcement of new roads or runways may be unpopular in some quarters but infrastructure – be it transport, communications, energy, water, sewage, housing – form some of the basic vital physical structures and facilities society needs.

In November, UK Chancellor George Osborne launched the National Infrastructure Commission (NIC) and announced £100bn will be spent on projects by 2020.

Osborne said then: “Infrastructure isn’t some obscure concept – it’s about people’s lives, economic security and the sort of country we want to live in.” The NIC is to provide a long-term view of the country’s needs, and lobbyists are already clamouring for portions of the cash.

Some significant advances are underway: further development of the ‘Northern powerhouse’ with improved sea freight terminals and high-speed rail links; the boosting of 4G network coverage; and, potentially, the UK’s first spaceport could be operational in Scotland by 2019.

Experts are even proposing ventures to reduce unnecessary or unwieldy infrastructure where it prevents progress. The Institute of Economic Affairs, for example, has just called for 80% of traffic lights to be ripped out to boost growth and improve road safety

It estimates the move could be costing the economy £16bn every year. Elsewhere there are concerns about a potential shortage of electricity in the UK.

The UK needs to address gaps and challenges if it is to increase GDP and compete on the global stage.

Difficulties here, however, are dwarfed by those faced by nations such as the landlocked, mountainous country of Rwanda. In terrain where building road and rail links is tricky, new drone technology could provide an answer.

And while talk of drones may conjure up images of unmanned stealth bombers or fancy gadgets for fans of Robot Wars, in Rwanda they could be used in a very practical way, to save lives and boost the economy.

A network of 40 droneports is planned, with construction of the first envisaged for later this year. Afrotech director Jonathan Ledgard has said: “Within a decade droneports will have shops where staff talk customers through shopping options on tablets and goods are shipped by drone from a distant warehouse in minutes.”

It is projected that 30 droneports could add 1% to a country’s GDP. A year ago, key figures in the Remotely Piloted Aircraft Systems industry met in Riga and broadly agreed upon the principles to guide a regulatory framework that would allow such operations in Europe from this year. In other words, it’s a work in progress. But in Rwanda, where the need is urgent and government regulation light, change is happening at a faster pace.

Infrastructure requirements are urging investment and innovation. Dubai and others are building cities of the future that consider everything from smart lighting and water to deploying jetpacks to douse fires in high-rise buildings. China is building a new trade route to change the way the world does business and in the Pacific and Atlantic oceans, expansion of the Panama Canal will double its capacity.

There is a growing requirement for these projects and it’s another opportunity for procurement and supply chain professionals to make their invaluable and indelible mark. CIPS has designed the four-day Complex Capital Projects Master Award programme specifically to assist those professionals working on such demanding schemes. Go to cips.org to find out more about getting to the heart of the commercial and strategic mindset these multi-million-pound projects demand.

☛ David Noble is group CEO, CIPS

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