Construction of Heathrow Terminal 5 has been characterised by a new approach to risk management and collaborative working. Traditional boundaries between client, designers, main contractor, subcontractors and suppliers have deliberately been broken down and replaced by loyalty to an integrated team.

From the outset BAA recognised that the risk associated with such a huge and complex infrastructure project required a fresh approach to construction management. Research into major construction projects highlighted two key areas that seemed to undermine progress; cultural confusion and the reluctance to acknowledge risk.

In a move to prevent this and guarantee that Terminal 5 did not suffer from costly delays and budget over-runs, BAA developed a unique and bespoke commercial partnering agreement with contractors and suppliers called The T5 Agreement. A contract based on relations and behaviours, it was designed to expose risk rather than transfer it to other parties.

Considered essential by BAA to deliver a project of this size and complexity on time and budget, the T5 Agreement underpinned the whole development. The idea behind the agreement was that no single contractor could be expected to bear £4.3 billion of risk, so BAA bore all the financial risk and in return the main companies involved committed to the team and moved into the same offices. Suppliers were to be up-front in their identification of risk and accept best practice as minimum.

To make sure it was successful BAA put together a huge in-house team to supervise and control the integrated team. BAA tirelessly and successfully promoted the philosophy that, if a problem occurred, no blame should be apportioned. Instead, all parties should work together to sort the problem out and to learn the lessons for the future. This philosophy was born of BAA’s view that resort to litigation would divert management, delay project completion and leave BAA out-of-pocket.

The agreement, which is aimed at mega projects, was fundamental to solving many of the challenges of the project. Forcing people to co-locate meant they worked together and it made people really understand and appreciate the technical challenges. An incentive scheme encouraged teams to work together in order to ensure key milestones were met on time, on cost and to high quality and safety standards.

The project was delivered on time and on budget so the agreement did what it was set out to achieve.

For ground works, the integrated team consisted of BAA, Mott MacDonald, civils contractor Laing O’Rourke, tunnelling contractor Morgan Est, principal subcontractors and suppliers, London Underground and Heathrow Express.