Over the past few years the APM Governance SIG (specific interest group) has run a series of events showcasing real examples of governance and sharing good practice. We were delighted, on 10th June 2015, to welcome Helen Gamlin, Head of the Programme Management Office from Heathrow to present and share insights. GovSIG welcomed members and guests to hear from LHR Airports (Heathrow) on lessons learned and the development of their governance of programmes. Some delegates present may well have heard Chris Elliot present in May 2012 as Heathrow introduced a new governance model – it was certainly intriguing to see how things have moved on since then! Heathrow is the busiest airport in the United Kingdom, the busiest airport in Europe by passenger traffic and the third busiest airport in the world by total passenger traffic. In 2014, it handled a record 73.4 million passengers and 470,695 transport movements. Helen outlined the key developments that Heathrow has taken over the last few years to improve their flexibility to the governance of projects and project management and increase business accountability for realisation of programme benefits. As at previous events, colleagues will had ample opportunity to discuss the analysis and trends with each other (and with Helen). All present were encouraged to offer their views on the extent to which these correlate to their own experiences. The event also provided opportunities for attendees to: Ask questions about the governance landscape at Heathrow Feed thoughts, observations or challenges back to the Helen Enjoy refreshments and join others for networking both before and after the event

1. APM Governance SIG, Wednesday 10th June 2015
Governance at Heathrow
Helen Gamlin

2. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Our Vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

3. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Our vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

4. Heathrow is the UK’s only hub airport
36% Transfer
Passengers
(26.3m)
93%
International
7% Domestic
73.4 million
passengers and
471,000 flights
a year
Flights to
185
destinations
in 84
countries
30% - business
70% - leisure
Employs
76,000
people-
110,000
indirect
jobs

5. We have a new vision

6. Where we are now compared towhen we last presented in May 2015

7. The next 5years show achange in scope for Development at Heathrow
• Bigger spend on Asset Management Projects than
Passenger Experience projects
• Lower capital investment than in previous
Quinquenniums
• Multiple small projects rather than “Big New Build”

8. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Change in Heathrow vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

9. But not everything has changed….we are still building on the principles of
Strategic Programmes that were set up in Q5
Deliver a noticeably better,
‘hub of choice’ passenger
experience
An ASQ rating of >4.0 and leading amongst
European hub airports with 80% of passengers
rating Heathrow as excellent or very good
Deliver improved resilience
and sufficient hub capacity
At least 80% of departing and arriving flights are
punctual to within 15mins of scheduled time;
with an aspiration to approach 90% punctuality
Ensure a competitive total
cost of operation
To be at the frontier of efficiency for major
European hub airports, by reducing our
underlying operating costs over Q6 by 9.4%
Strategic programmes
Terminal 2 (£282m)
Q6 Realisation (£29m)
Hub Capacity
Passenger Experience (£401m)
Airport Resilience (£526m)
Baggage (£593m)
Asset Management (£957m)

10. Better level of understanding of what lower levels of investment will give
c£2bn Investment
Sustain a passenger
experience consistent with
an improving European
average
An ASQ rating > 3.9
Protect existing levels of
resilience and hub capacity
70 – 80% of departing and arriving flights
are punctual to within 15mins of schedules
time
Ensure a competitive total
cost of airport operation
To be at the frontier of efficiency for major
European hub airports, by reducing our
underlying operating costs over Q6 by 9.4%
Deliver a noticeably better,
‘hub of choice’ passenger
experience
An ASQ rating of >4.0 and leading amongst
European hub airports with 80% of passengers
rating Heathrow as excellent or very good
Deliver improved resilience
and sufficient hub capacity
At least 80% of departing and arriving flights are
punctual to within 15mins of scheduled time;
with an aspiration to approach 90% punctuality
Ensure a competitive total
cost of operation
To be at the frontier of efficiency for major
European hub airports, by reducing our
underlying operating costs over Q6 by 9.4%
c£3bn Investment

11. We have a clear link from our Heathrow objectives through to Director
personal objectives
Deliver improved
resilience and sufficient
hub capacity
The Airport Resilience
Programme vision is to provide a
resilient airport with capability to
meet demand and recover quickly.
This will be achieved through a
series of objectives whose
cumulative effects will mean an
improved headroom for the
operation and improved punctuality

12. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Change in Heathrow vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

13. 2006
2003
2000 2nd Generation Frameworks
T5 Agreement
3rd Generation (Value in
Partnership) Frameworks
Heathrow Development’s Journey
1st Generation Frameworks1994
2009
Start of Open Competition
(movement away from frameworks)
“Integrating Construction” Client
“Partnering” Client
“Project Management” Client
“Intelligent” Client
2010
Launch of Capital Re-Engineering,
18 month change programme.
2013
“Programme Management” Client
2015 Professional Collaboration The Q6 Model

14. Changes to Heathrow Development Model
Arups Arups AtkinsJacobs
Airport Resilience
Passenger
Experience
Baggage Asset Mngt
Turner & Townsend Wilson James
Programme Management Office
Balfour Beatty MACE
Ferrovial
Agroman Morgan Sindall
A/S & L/S
North
A/S & L/S
South
T1 & T2 T4 T3 T5
Delivery Teams

15. Amodel based on Professional Collaboration
Keeping Everyone Safe Uncompromising
commitment by all parties to Health and
Safety
Treating Everyone
with Respect
Encourage
everyone to put
their views forward
constructively,
listen to each other
and respond
respectfully
Giving Excellent
Service
Provide the basics
of delivery brilliantly,
constructively
challenge, bring the
best market
innovation to us
Working Together
Work collaboratively and keep all relevant
parties involved and informed
Improving Every Day
Continually improving what you deliver
and how you deliver it
Doing the Right Thing
Focus on the right things that make the
biggest difference
Sub- contractor
2nd Tier
Design
Heathrow
Cost &
Commercial
Consultant
Designer
Logistics
Integrator
Delivery
Integrator
Collaboration
Business relationships formed by committed
organisations to maximise performance for the
achievement of aligned objectives and creation of
additional value
Professional
Competent or skilled in a particular activity

16. The role of Sponsors……or Business Case Owners
• Provide guidance and
recommendations to the
Programme Lead to ensure
the requirements of the
executive sponsor (i.e.
benefits realisation) are
actively managed
Executive Sponsor
• Owns the vision
• Shapes, champions & advocates the programme
• Owns the Business Case
• Accountable for the benefits and outcomes
• Manages interfaces with key stakeholders
• Works with the Programme
and Delivery Directors to
ensure the requirements are
clear and the scope and
solution is agreed
• With Development, jointly
presents the business cases
for approval
Business Case Owner
• Act on behalf of the executive
programme sponsor to own the business
case and ensure benefits are realised
• Unblocks issues and owns internal business
change activities
Sponsor’s Agent
• Act on behalf of the executive programme
sponsor to test and challenge the aims,
business case, benefit realisation and
progress of the strategic programme
• Focus the Exec sponsor, and sponsoring
group on the relevant decisions and
issues to ensure success

17. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Our Vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

18. Anumber of stakeholders think they “Govern” Development Business
Cases
PMO
Shareholders
Heathrow
Engineering
Heathrow
Operation
Airlines
Independent
Organisations
Airline
Operations
Heathrow
Finance
Independent
Fund
Surveyor

19. What do our shareholders say?

20. What do theAirlines say?
Introducing the Independent
Funds Surveyor
Service and
standards
Technology

21. What do Operations say?
Increase CAPEX to reduce OPEX
Don’t disrupt the operation!

22. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Our Vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

23. Heathrow Portfolio, Programmes &Projects
Identify
Programmes
Defining a
Programme
P1
P2
Programme
Brief
Programme
Sanction Benefits
Realised
Closing
P4P3
Managing the Tranche
Delivering the Capability
Realising Benefits
Manage Functional Portfolio:
Scan environment & change Briefs Manage Portfolio efficiency
Benefit
Cost
Risk
G1 G2 G3 G4 G5 G6 G7 D8G0
Initiate Options
Solution
Development
Implement Transition Operation
Close
down
Definition
G1 G2 G3 G4 G5 G6 G7 D8G0
Initiate Options
Solution
Development
Implement Transition Operation
Close
down
Definition
Cost
QualityTime
Portfolio
Definition
Portfolio
Strategy
Portfolio
Delivery
Portfolio
Re-Definition
Strategic
Benefit
Resource
Investment
Business
Risk

24. • Industry best practise identifies the following are need for successful transformation or
investment programmes
– Strong Sponsorship
– Clear vision for success to generate alignment
– Strong ownership of the benefits
Good Governance –where we were..
• The Strategic Programme Sponsoring Groups will drive Heathrow governance
– The governance groups of the business at Heathrow
– Formal committees of the Executive
– Responsible for managing budgets
– Cross-functional
• Terms of reference for the Sponsoring Groups
– Define the authority of a sponsoring group and the delegation from the Executive including financial
authority
– Define responsibilities – what’s within scope, cross-functional engagement
• Good governance is vital for our business
– Clear lines of delegated authority with limits on approval of financial expenditure
– Defined approval processes – who is responsible for what

25. • Industry best practise identifies the following are need for successful transformation or
investment programmes
– Strong Sponsorship
– Clear vision for success to generate alignment
– Strong ownership of the benefits
Good Governance –where we were..
• The Strategic Programme Sponsoring Groups will drive Heathrow governance
– The governance groups of the business at Heathrow
– Formal committees of the Executive
– Responsible for managing budgets
– Cross-functional
• Terms of reference for the Sponsoring Groups
– Define the authority of a sponsoring group and the delegation from the Executive including financial
authority
– Define responsibilities – what’s within scope, cross-functional engagement
• Good governance is vital for our business
– Clear lines of delegated authority with limits on approval of financial expenditure
– Defined approval processes – who is responsible for what

26. • Industry best practise identifies the following are need for successful transformation or
investment programmes
– Strong Sponsorship
– Clear vision for success to generate alignment
– Strong ownership of the benefits
Good Governance –..and where we are now
• Matrix determines Governance route for each business case
• Delegated Authority to Business Case Owner, Programme Director
• Delegated Authority to Business Case Steering Group
• Large, complex Business Cases require Governance Service
Transformation Team and Sub Group of Executive
• Further Governance required at HAHL Board for some financial
approvals
• Consultation with Airline Community throughout and engagement with
the Independent Funds Surveyor (IFS) if required
• Good governance is vital for our business
– Clear lines of delegated authority with limits on approval of financial expenditure
– Defined approval processes – who is responsible for what

27. Good Governance –Projects are categorised
Does the investment … Low Medium Significant
Reduce the expected benefits from the
overall Business Case
None / Minor Moderate Significant
Negatively impact EBITDA
(requires budget holder sign-off)
<£0.5k pa <£1m pa >£1m pa
Negatively impact passenger experience
or resilience?
Minimal short term;
No long term
Significant short term
Or minimal long term
Significant long term
Negatively impact airport capacity? None / Minor Moderate
Reduce / significantly
increase published
capacity declaration
Impact an airline’s efficiency or
competitiveness?
No No Yes
Qualify as a Key Project or have triggers No Yes – Key Project Yes – Trigger Project
Have capex value of £0 - £1m £1 - £5m >£5m
Governance route for Investment
Decisions (Gateway 3)
Business Case Owner
Programme Director
Investment Finance
Executive Sponsor
Business Case Owner
Programme Director
Investment Finance
STT
Q6 Realisation Sponsor
Group (Q6RSG)

28. Our Governance is based on the project classification
Reflected in Heathrow Gateway
Management Plan

29. Today’s session
• Who on earth is Helen Gamlin?
• Heathrow Development Journey May 2012 – June 2015
– Our Vision
– Our Strategic Programmes
– Our Organisation and Supplier framework
– Our Stakeholders
– Our Governance
• What next for Heathrow Development?
• How does this compare?

30. What next for Governance at Heathrow
• Remain with flexible
Governance approach
determined by size of
investment, complexity of
project and business change
• Continuous Improvement will
remain (e.g. integrating
Gateway Management Plans
and Project Management
Plans)
• Strong sponsorship and
benefits driven decision making
• Sponsor Groups?
• Organisation change to
accommodate “big build”
again?
• A consolidation of the best of
Q5 and Q6 Governance

32. This presentation was delivered at an
APM event
To find out more about upcoming
events please visit our website
www.apm.org.uk/events