The aspirations held by Babcock’s Australian management team follow the award of the company’s first fleet contract in Australia – a five-year contract to deliver fleet management services to MSP Group, the fast growing diversified construction and building products company owned by South Australian businessman Mark Pickard.
{{image2-a:r-w:300}}Babcock Pty – local arm of Babcock International Group and based in Adelaide – secured the contract after a competitive tender for fleet management, repairs and maintenance services of heavy mobile equipment (HME) and concrete agitators for an initial five-year period.
MSP Group has been operating for 35 years, producing and selling quarry products, concrete and building products.
Babcock Pty chief executive Craig Lockhart said the MSP contract was the “first but very important commercial contract win” for the company’s fleet management business unit in Australia. With the MSP agreement, Babcock’s first Australian workshop and fleet of mobile maintenance units is now fully operational.
“This will certainly assist to deliver further opportunities for growth both within MSP and with other Australian companies,” Lockhart said.
Babcock will expand to other Australian locations in the near future. The company’s growth path in Australia is destined to replicate growth it has enjoyed in the northern hemisphere where Babcock is a major player in fleet management for construction assets.
A key factor in this growth trajectory is ALCAMiE, a management approach that combines a range of customised systems that deliver services and manage costs over the whole life of an asset – from procurement through to disposal.
Babcock introduced ALCAMiE across the operations of Lafarge (now LafargeHolcim), a global leader in building and construction materials, after the company declared it wanted to reduce its costs and increase fleet and equipment availability by transforming the way it manages its fleet of HME across the UK, US and Canada.
The 10-year $280 million fleet management contract that commenced in 2011 sees Babcock managing over 1000 HME assets across 300 sites.
Babcock’s approach to implementation included setting up local management teams and control centres that were familiar with the local cultures and locations, and, wherever possible, local people with the right blend of technical knowledge and experience were recruited to the team. Extensive training and support was provided to both existing and new employees on an ongoing basis.
The partnership was further strengthened in 2014, when Lafarge awarded Babcock a $110 million contract to manage and
maintain its ready-mix concrete fleet in western Canada.
THE CHALLENGES
{{image3-a:r-w:300}}Babcock faced a series of challenges in delivering the Lafarge contract which included:
- Delivering efficiencies across a highly complex fleet spanning a diverse range of manufacturers and specialised equipment.
- Gathering data on the whole life costs and performance of a fleet spread across hundreds of geographically diverse locations.
- Inspecting and assessing each HME asset individually across all territories for complete fleet visibility.
- Staged mobilisations within tight timeframes across diverse territories whilst providing training and support for Lafarge personnel undergoing the change to a centralised asset management system.
- Centralising and optimising the commercial supply chain to gain maximum value from Lafarge’s global buying power.
By implementing ALCAMiE, its proven fleet management approach, Babcock helped Lafarge optimise fleet availability, streamline administration and reduce costs. This customised set of systems and processes captures fleet performance data and maintenance costs over the whole life of an asset to provide Lafarge with accurate asset information for strategic decision-making.
Following mobilisation, Babcock worked with the existing supply chain to find ways of delivering a more efficient process.
In addition to establishing relationships with the local in-territory service providers and dealer networks, Babcock also put in place transparent costing models and a streamlined procurement process that explained to the market how the new partnership between Babcock and Lafarge would operate.
The partnership between Babcock and Lafarge was cemented through regular structured progress reviews and communications. Continuous improvement teams have been established and continue to work on identifying, evaluating and implementing new efficiency ideas across Lafarge operations. The benefits of the partnership are as follows:
- 27,000 jobs managed since 2011.
- Over $120 million invested in new assets across all territories.
- 253 rebuilds across territories.
- A 15 per cent reduction in Lafarge’s North American fleet, saving around $45 million in unnecessary replacement costs.
- Increasing supplier efficiencies for Lafarge, through transparent costing models, a compliant procurement process and continuing to challenge the status quo.
- A Ready-mix Western Canada 10-year contract awarded to Babcock to manage 800 assets across 45 sites and which transferred 30 Lafarge technical staff to Babcock.
In Australia, fleet management is just one arm of the Babcock business. The company is one of the fastest growing engineering support services companies in the Australian market, having recently added Australian Helicopters and Bond Helicopters Australia to its portfolio in 2014. The company has more than 700 skilled staff working within Australia and New Zealand who design, build, manage, operate and maintain assets that are essential to Babcock customers and
their operations.
Source: Babcock Pty (Australia)