Case Study: Canam and Whangarei District Council - Connecting With Communities Through Construction

This case study focusses on an innovative procurement process promoting community objectives, including the use of local companies and training opportunities for the local workforce.

The Whangarei District Council appointed Canam as the construction partner prior to selecting a site to ensure that design and construction considerations were factored into site selection, and that the procurement process included weighting – to make sure that community objectives were a key factor.

Background

The building and construction sector is New Zealand's fourth-largest employer and contributed more than $16 billion to the country's gross domestic product in the year ended June 2020. However, reports indicate that just 15% of that activity effected the regional areas of New Zealand.

This imbalance has led to an under investment in skills development and training for people in regional areas – widening the capability gap between the country's regions and main cities, and causing regional projects to be led by specialists from outside the region.

While this issue aims to be addressed through the Provincial Growth Fund, it's essential that large investments in regional areas, such as construction projects, are used as a catalyst to support local economies and develop local people.

Whangārei District is made up of urban, suburban, coastal and rural areas stretching from Bream Bay to the south of the Bay of Islands, with a population of around 100,000 people.

For the Civic Centre project, Whangarei District Council want to make sure that the building supports and benefits the local community, by ensuring that the multimillion-dollar investment provides opportunities for local companies and local workers. The community needs to benefit from the opportunities, training and knowledge that this project can bring – allowing the Council to connect with its communities through construction.

Project overview

Project goal: To derive maximum benefit from construction expenditure by actively supporting the community where a construction project is taking place.

Statistics:

Whangārei Civic Centre is a 8,010m2 project with an overall budget of $48 million and a build cost of $36 million

200 jobs created in the region during the project, with 80% of those in the local area

109 subcontractor and supplier work orders on the project, with a target of 80% of the subcontractors and suppliers sourced from Whangārei.

Applies to: Construction and infrastructure projects of all sizes in various communities.

Accord goals:

  • Raise capability
  • Improve resilience
  • Restore confidence, pride and reputation

Accord outcomes:

  • Job security
  • Career pathways and opportunities to upskill
  • Transparency
  • Workforce capacity and capability
  • A collaborative industry

Acord principles:

  • Working in a collaborative and inclusive way
  • Fostering careers to nurture the industry's future
  • Acting as a custodian for the sector's future

Project stage: Procurement elements of the community approach are partially completed, and the construction phase of the Whangārei Civic Centre is underway with piling complete.

Beacon monitoring process: The Accord Beacons team will monitor Canam's progress as the project progresses and focus on key performance indicators, such as the development of the local workforce.

Whangārei Civic Centre – a hub for the community

The Whangarei District Council's City Centre Plan identified that a new civic centre was needed to effectively support the community. The building would bring disparate staff together, creating operational efficiencies and forming a vibrant, attractive and experience-driven centre for the district.

Requirements for the building

  • Serving as a base for council operations to meet the needs of residents and ratepayers as the district continues to grow and develop
  • Creating efficiencies by consolidating the two main council sites at Forum North and Walton Plaza
  • Delivering on the Council's statutory requirements
  • Reflecting the community’s needs now and in the future.

Requirements for the project

  • Designed with sustainability and the total cost of ownership in mind
  • Providing value for money
  • Including innovative ideas
  • Achieving wider benefits and broader outcomes for the local community

The 8,010m2 Whangārei Civic Centre will house 350 council staff and all of the Northland Transport Alliance staff that are currently scattered around the city. It's also designed to cater for growth – future-proofing for the next 50 years.

Connecting with communities through construction

In 2018, Whangarei District Council took an innovative approach to procurement by appointing a construction partner before they had selected a site. The move ensured that design and construction considerations were factored into site selection and enabled a fully informed decision to deliver value for residents and ratepayers.

Canam is a New Zealand-owned construction company that started in 1955 and now operates a regional network of offices in Auckland, Northland and the Bay of Plenty.

Canam are one of the few remaining construction contractors that directly employ trades staff to complete all concrete, formwork, carpentry, partitioning and joinery on their projects. Staff often work locally on their projects and are invested in the communities that they work in.

After a rigorous procurement process, including proposals and interactive workshops with alliance partners, Canam Commercial Ltd. were appointed by Whangarei District Council as lead contractor and The Building Intelligence Group were selected as the clients' representative. The objective is to ensure that the project is a positive experience for all parties and will create opportunities that benefit the district.

The original procurement strategy was based upon a design and build approach, with Canam leading the consortia. However, the key project participants – including Canam, The Building Intelligence Group and Avery Team Architects – decided that this approach would not deliver optimal outcomes for the project. Instead, they needed to use a model that aligned to the Council's objectives around collaboration, teamwork and socially responsible procurement. The procurement strategy was revised to an Early Contractor Involvement model, featuring an open book, cost reimbursable contract. Together the project participants developed the project's Community Outcomes, focusing on a combined set of objectives.

Approach

The community-based approach adopted by the project team includes three key focus areas:

  1. Promoting the use of local companies
  2. Developing training opportunities for the local workforce
  3. Engaging with the local community to promote the construction sector.

Promoting the use of local companies

As a procurement objective, Whangarei District Council, Canam and its project partners agreed to use local consultants, subcontractors and suppliers where possible. To ensure this objective was reflected in procurement activities, a non-price attribute was established that included a scoring system related to the supplier's distance from Whangārei.

Key to making this effective is aligning non-price attributes to community-based values and goals. The weighting of the outcomes also needs to be sufficient to have a bearing on the final decision.

Developing training opportunities

The Council requires that at least 10% of each respondent's project team are trainees or apprentices. Any respondent not achieving this level wouldn't be considered for the project.

Canam monitors this target during construction with an electronic sign-in system at the main entrance to the site. Each person is required to sign in and out each day on an electronic tablet by entering their name, company, health and safety data, and whether they are a trainee or apprentice. The system also doubles as a COVID-19 contact tracing system.

The data collated at this sign-in station is automatically saved and downloaded each fortnight into an excel spreadsheet. This enables Canam to report to the Council and its project partners on the number of trainees and apprentices via an automated dashboard in the monthly contractors' report.

Engaging with the local community to promote the construction sector

A key part of Canam's work in the Whangārei District is engaging with the community to promote potential employment opportunities in the construction sector. Canam partnered with NorthTec, a tertiary education provider in Whangārei, to offer business students part-time work on the project and experience working on a construction site.

"I would like to see this as the beginning of our relationship with NorthTec. We hope to organise site visits for construction students on a monthly basis, which will help them get into the industry." - Tonchi Glamuzina, Commercial General Manager, Canam Commercial Ltd.

As part of the partnership with NorthTec, Canam invited art students to participate in a design competition for a new logo to use on its projects in Northland. The winning design was selected by a panel of judges including Canam's directors, the lead architect for the Civic Centre, Whangārei Mayor Sheryl Mai and various representatives from Whangarei District Council.

The broader community engagement strategy also included:

  • Organising tours for Dargaville High School Trade Academy at the NorthTec future trades campus, including the civil engineering and architectural technology facilities
  • Attending the Pompallier College vocational day organised by the Ministry of Education and Te Tai Tokerau Trades
  • Attending career open days at Dargaville School and Whangārei Boys High School
  • Attending orientation day for the I Have a Dream Charitable Trust in Whangārei
  • Presenting at the Whangārei Women in Industry event.

Hapū as a key partner

Local hapū were identified early as a key project partner. The project tapped into the Council's own capability, with its Māori Relationship Manager helping to identify aspects of the project important to local hapū.

Specialist consultants Landform Consulting and Matakohe Architecture & Urbanism were engaged to conduct a cultural impact assessment and incorporate Māori design into elements of the building. Cultural narratives were incorporated into the design of the building and landscape architecture, including a traditional welcome area and community garden with native medicinal herbs. Inside the building, the Council chambers are specifically designed for it to be converted into traditional marae seating – allowing meetings with hapū to follow Tikanga Māori.

In addition to engaging local consultants, primary Māori representation for the project is provided by the Roopu Kaumatua Group – a governance group comprised of leaders and representatives from various Whangārei hapū. The group was formed following several hui to advise the Council on the needs and interests of hapū, and to protect the site and surrounding water ways.

Cultural monitors were appointed by Roopu Kaumatua to monitor, assess and verify site excavations to ensure that the discovery of any archaeological material or taonga are carried out appropriately, and protocols, such as the placing of mauri stone, are carried out according to Tikanga Māori.

Department of Corrections partnership

The project encourages the Canam team to think beyond the traditional approach of employing trainees. Working with the Department of Corrections, Canam is participating in a programme to rehabilitate offenders by providing carpentry apprenticeships. The apprentices are full-time, permanent employees that are working on the project until its completion, while studying carpentry and joinery at NorthTec.

Outcomes and benefits

Project Governance

Project objectives are usually set around time, cost and quality. By developing a genuine partnership with Whangarei District Council, the Canam team were fully informed of the aspirations, risks and issues important to the Council. This allowed the project team to address these issues early in the design.

Promoting the use of local companies

The project team agreed on a target of using 80% local subcontractors and suppliers and 80% local labour. The initiative has exceeded expectations to date with 85% of successful respondents considered local companies – with a third of all subcontracts being let by the project so far.

Developing training opportunities

Canam estimated that over 200 tradespeople are needed for the project. Currently 25% of the team are trainees and apprentices – significantly exceeding the target of 10%.

Engaging with the local community to promote the construction sector

While the benefits of community engagement can be harder to quantify, Whangarei District Council Chief Financial Officer and project sponsor Alan Adcock said:

"The Civic Centre construction project offered a rare opportunity for Whangarei District Council to lift the profile of our local trades, services and apprentice and training organisations, while providing valuable experience at one of the largest construction sites in our region.

"While it is difficult to measure the benefits of this engagement in a traditional sense, partnering with NorthTec and having a local trades procurement target has helped develop a grassroots sense of pride and ownership, essential in any true community asset. Our Council is very happy with the outcome of this approach, which has helped strengthen communication channels between Council, our community and the local construction sector."

Lessons learnt

Non-price attributes

Public sector construction clients have utilised the weighted attributes approach in construction procurement for some time. However, this approach was new to Canam for subcontractor procurement, and it was also new for local subcontractors, but all parties adopted it with enthusiasm.

Canam found that the key learning in implementing a weighted attributes approach in subcontractor procurement is the process for debriefing unsuccessful bidders.

"Providing tender responses to non-price requirements in a subcontract tender process requires more of a time commitment from subcontractors to be able to submit an appropriate bid. This means that respondents have to invest more time, effort and money into tendering. As a result, unsuccessful tenderers require significantly more clarity and communication on why they were unsuccessful. This necessitates more training of our staff to ensure that there is good quality feedback to bidders, so that they can improve their performance in future tenders." - Stephen Jones, Director, Canam Commercial Ltd.