Coria’s hyper-automation tool Digital Cost Assurance improves National Highways’ actual cost confidence

About National Highways

National Highways is responsible for operating England’s motorways and major A roads—the backbone of the nation’s transport network. It keeps vital routes moving for millions of drivers every day, with safety as its top priority.

National Highways is also responsible for managing investment in the strategic road network through major replacements and enhancements, delivering complex projects that cost from tens of millions to billions of pounds.

As a capable infrastructure owner, and in common with many infrastructure organisations, National Highways recognised elements of the research findings in 2023 that a traditional approach to commercial assurance can contribute to 12 – 46% overspend depending on the size and complexity of schemes. Traditional approaches to project cost assurance are heavily dependent on manual activities with only basic software tools to help deliver complex tasks in severely pressured time limits. This results in assessment of costs using sampling methodology, forecasting and reconciliation, and leads to inefficient, inaccurate, incomplete, and inconsistent outcomes with overwhelming data.

So, for the infrastructure industry to adopt Construction 4.0 [1] and, more specifically, Infrastructure 4.0 [2] and the associated benefits of a shift to AI, IoT, and PA, there is demand for better use of more scarce specialist’s time, improving “should cost” accuracy, and better empowerment of innovation from the supply chain by harnessing the power of digital tools in collaboration with human talent.

The results

The introduction of an automated solution means data can be accepted as raw cost data from the construction suppliers ERP system and doesn’t require the Contractor to compile a project ledger. By pre-agreeing with the parties, the analytical rules for the system, in line with the contracted agreement, data is pre-sifted at source. This means that assurance checks on invoice data that previously took days now takes minutes. As a result, the capability now exists to assure 100% of all costs rather than a sample-based approach driven by constrained timeframes and limited resources. From the pre-sift, data that requires investigation or clarification can be identified and dealt with by human specialists, meaning available time is spent addressing potential problems, rather than identifying them in the first place. Specialists then have an elevated workload moving from sample based random checks to meaningful assessment that demands better use of their highly valuable skills, enabling them to achieve more with their time. By providing analysed data to the cost specialists in minutes we allow for data to be submitted closer to the assessment date. This reduces forecasting inaccuracies and reconciliation, makes agreement of actual cost easier and reduces the stress and pressure of the team involved. A crucial part of the work done in conjunction with the software team was to understand what impact the use of process automation has on the client and contractor’s processes, protocols, and governance. As part of the development of Coria’s’ solution such changes are done in parallel to enable the integrate community to optimise the benefits of the digital systems.

Ultimately, getting to detail faster allows more time for the assurer to correctly assess Applications for Payment. The indirect implications of this include reduced risk, certainty of cash flow, outturn forecast confidence and allows integrated project teams to identify process and material defects to enable corrective action and reduce inefficiency.

Traditional methods of cost assurance costs tens of millions of pounds a year to deliver a suboptimal outcome that is typically based on 20% sample data. This creates an opaque risk for National Highways. In the past, National Highways have considered the outsourcing of cost assurance as risk mitigation, where evidence from the market shows that this risk is not being mitigated. The realisation of this risk means it resorts to lengthy and expensive forensic audits, which don’t show up issues in real time, limiting the client’s options for resolution or avoidance of the impact on outturn costs. Coria’s Digital Cost Assurance solution enables 100% review of each assessment period and real time problem identification, creating better value for public money.

Coria continues to work to develop process automation systems supporting construction professionals that can be rolled out as a standard across the buyer organisation. Alongside Digital Cost Assurance we are evolving other solutions to be applicable across the whole of the construction sector as we consider digital transformation to be a means of achieving illusive productivity gains.