黑洞社区

Simon Vivian is very fond of Bath. He studied economics at its windswept university. And after a period of working abroad he came back, settled down, and spent the next 17 years in this world heritage site, with its beautiful parks, graceful Georgian crescents and its bitter construction disputes.

Six months ago, Vivian, 47, left a top job at Hanson to replace Sir John Gains as chief executive of Mowlem. And, alongside his responsibilities for generaling a 拢2bn turnover contractor, he took on the job of fighting the battle of Bath Spa. As even casual readers of 黑洞社区 will know, this began as a fairly unremarkable scrap over peeling paint, then turned into a restaging of the battle of Stalingrad in a swimming pool.

Onlookers have watched with growing amazement, not to mention amusement, as Mowlem and Bath council competed to launch the most vituperative public attacks on the other. Or rather, competed to put together the most 鈥渟ystematic smear campaign鈥�, as Mowlem phrased it in one memorable press release. At present, the project is more than five years late, its budget of 拢13m looks like becoming an out-turn cost somewhere north of 拢40m and Mowlem has left the building 鈥�

鈥淭he situation is just not good for anybody,鈥� says Vivian, sternly, sitting in the boardroom of Mowlem鈥檚 offices in Isleworth, Middlesex. 鈥淣obody is coming out of this very positively; it鈥檚 a very unfortunate set of circumstances.鈥�

Vivian explains that Mowlem was not legally obliged to leave the project, but felt it was the right thing to do. 鈥淭here was no point prolonging the situation. From our perspective we were in an impossible position 鈥� in a triangle between the architect and client.鈥� So, once the council ordered Mowlem to leave, it was time to cut its losses.

Although the struggle on site may be over, the one in the High Court is just beginning. Vivian says Mowlem will pursue the council for 鈥渁 not insubstantial sum in compensation 鈥� we have an extremely solid case鈥�.

Bath Spa is not the only trouble Vivian has seen since he joined Mowlem as chief operating officer last year. In fact, it has been one thing after another. In March, the firm declared a 拢7.4m loss for the year ending 2004, and finance director Gerald Brown announced his resignation shortly afterwards 鈥� but not before giving an embarrassingly emotional defence of his record to the City.

Then there was the emergence of an 鈥渁ccounting issue鈥� at an M&E subsidiary, the loss of chairman Charles Fisher and the accusations of poor workmanship on the West Coast mainline, which led to the humiliation of Network Rail banning the company from carrying out track renewals. If that weren鈥檛 enough, there have been four profits warnings this year 鈥� culminating in a statement on Tuesday that returns would be 拢20m lower than expected.

But the most frustrating thing for Vivian, personally, has been enduring the period between taking over as chief executive on 1 January and the departure of Gains in May. In effect, he has had to watch the horror show from the sidelines, with his hands tied.

鈥淚 feel like I鈥檝e only been in charge properly for the past two months,鈥� he says. In that period he has undertaken an internal review, and is about to implement its findings: the axeing of 150-200 jobs. 鈥淲e have a new management team in place and I鈥檓 trying to instill cultural change in the company. You鈥檝e got to remember that John Gains was at the company for a very long time, and there has been very little change in that time.鈥�

So, is he pointing the finger at his former boss? 鈥淚 don鈥檛 think our problems have been a direct result of Gains鈥� management,鈥� he says. 鈥淚 think it鈥檚 more about balance sheet issues. I have a more centralist approach to management and take a more prudent approach to financial issues. One example is profit recognition 鈥� I鈥檓 not prepared to take as much risk and perhaps have a different take on the value of contracts than his.鈥�

I don鈥檛 think Mowlem鈥檚 problems have been a direct result of Gains鈥� management. I think it鈥檚 more about balance sheets

To underpin this more conservative approach, Vivian has appointed Paul Mainwaring finance director and has spent much of his time recruiting more financial people, as well as creating the role of head of risk management.

What does he have to say about the tenure and departure of Mainwaring鈥檚 predecessor? 鈥淚 shouldn鈥檛 comment too much 鈥� he was holding things together until his replacement arrived; I shouldn鈥檛 comment further 鈥� I suppose that was a fairly guarded response.鈥�

And guarded is a good word to describe Vivian鈥檚 body language: as he talks he keeps the kind of eye contact that batsmen reserve for wily leg spinners, and sits much as he does in the photograph on the right: square on and pulled up tightly against the boardroom table.

鈥淕uarded鈥� is the word that former colleagues use, too. 鈥淪imon has been very guarded since he took over; it鈥檚 a natural position to take when you are instilling change and getting rid of people,鈥� says one. 鈥淵ou鈥檝e got to remember he鈥檚 taken over from somebody who spent a lifetime at Mowlem, who had an established hierarchy and management team and who spent an eternity to eventually leave.鈥�

The colleague adds that wary pragmatism is not the full story of Vivian鈥檚 personality. 鈥淵ou will begin to see the real Simon emerge as he asserts his control. He鈥檚 a friendly, straight, decent guy, who will give everybody he works with a sense of certainty so they can operate to the best of their abilities. Not only that, he鈥檚 likeable. He鈥檚 not caught up in the pretentiousness of the City, and if you鈥檝e got a problem you can have a beer and sort it out.鈥�

The next step in Vivian鈥檚 plan will be to undertake a review of the company鈥檚 business strategy. He will present his conclusions to the board in the autumn. It is likely that he will recommend disposing of some elements of the business, although he refuses to be drawn on which 鈥� except to point out that the company鈥檚 Australian arm will not be sold, despite industry speculation to the contrary.

Vivian denies that he plans to follow Amec into the support services sector and says he is committed to Mowlem鈥檚 present mix of traditional contracting and PFI work. Mowlem expects to reach financial close on the 拢5bn Allenby Connaught army accommodation PFI in the last quarter of the year.

Vivian is, however, concerned about the uncertainty of the PFI process in the short to medium term. He鈥檚 aware that leading industry figures are in a dialogue with the government over the cost of PFI bids. He says that the Treasury should address these issues before it signs off a fresh wave of deals. 鈥淭here are certain value assumptions that are being tested by the government. The PFI may not be the wholesale solution it has been over the past 15 years 鈥� it鈥檚 in the melting pot.鈥�

Vivian feels the same uncertainty about the way construction projects are managed by government at local level. As well as a certain heritage project in Bath, Mowlem recently completed the Spinnaker tower in Plymouth. This was also going wrong, but unlike Bath Spa, an amicable solution was reached. 鈥淭he council was getting the right advice,鈥� says Vivian. He adds that he may well become involved personally in the discussions to reach a settlement of Bath Spa. He claims that nobody has upbraided him in the streets of his home town, but is only too aware that the public feel the project is a 鈥渟hambles鈥�.

While that dispute simmers on the back burner, he will be meeting John Armitt, Network Rail鈥檚 chief executive, to try and save Mowlem鈥檚 rail renewals work. And if all goes to plan, the contractor should be back on the tracks by the autumn 鈥� at which point Vivian can start running a contractor.