Artelia’s Cost Management team is supporting a new Government endorsed model of construction procurement, known as Integrated Project Insurance (IPI), which is being trialled on the new Museum of Making at Derby Silk Mill.
IPI involves setting up an Alliance, a ‘virtual company’ of client, professional team, contractor and suppliers to deliver a project. Alliance members work together to achieve the client’s target cost. Direct costs, plus an element for overheads and profit are negotiated among the alliance members, while an insurance policy covers unforeseen cost overruns beyond each member’s agreed financial tolerance. This removes traditional mindsets about protecting each organisation’s interests and enables everyone to think freely and innovatively about creating value.
Three independent parties provide reassurance to the insurer: an Independent Facilitator (IF), the TIRA (technical independent risk assurer) and FIRA (financial independent risk assurer). Artelia is acting as the FIRA.
Our client, Derby Museums, chose IPI based on the success of a trial project at nearby Dudley College. The £17 million project involves renovating a former Grade II listed Silk Mill, part of the UNESCO-inscribed Derwent Valley Mills World Heritage Site. The new museum, due to open in September, will celebrate Derby’s rich 300-year history of making to inspire new creativity and the makers of tomorrow. Exhibits include a suspended seven-tonne jet engine manufactured by local firm, Rolls-Royce.
The Alliance way of working at the Museum of Making has delivered value through the whole team contributing to the management of design and costs within the agreed maximum investment target and overcoming programme hurdles to minimise impact on time.