The Scottish Water Solutions Model

Scottish Water Solutions is a unique organisation. As one of the biggest partnering agreements of its kind, it brings together eight companies with considerable experience in delivering efficiencies on large Capital Programmes, within similarly challenging timescales.

The business model - a limited company within a publicly owned utility - is bringing global best practices from each partner to the Scottish water industry, particularly in the fields of asset management, engineering, programme management and construction.

Solutions has no employees, and is operated by staff seconded from Scottish Water and each of the partner companies.

Joint Incentivisation

The partnership model adopted by Solutions is the first of its kind in the water industry where client, consultants and contractors collaborate together on a jointly incentivised basis.

It is based on the principles of achieving mutual goals, shared risk and reward, continuous improvement in relationships with active and practical involvement of all interested parties in joint decision making.

Financial rewards come to all partners on the delivery of the programme, each partner being incentivised to work for the good of the programme as a whole rather than individually on a project basis. Fees are earned by the partners for work completed and incentives have been built into the payment mechanism. These fees are significantly at risk for underperformance.

Further incentivisation is delivered through a pain-gain share mechanism which requires Solutions to out perform against the expected investment delivery cost and future operating cost of these assets.

This collective incentivisation eliminates costly claims, a common feature of the UK construction industry, creating a win/win, lose/lose situation for all partners.