A project may be considered successful if the building is delivered at the stipulated time, to budget, as per specifications, and built in a safe environment (Lester, 2007); these criteria, and others, are, usually, carefully considered when choosing the right procurement route.
The procurement process is the method used to acquire goods and/or services, which must, carefully, be managed to ensure that good value is obtained; the correct goods or services are purchased, a high level of quality is obtained, timescales are met and good relationships are maintained between the Client and the Contractor.
The selected route should follow a strategy which fits the objectives of the client’s business plan. Considerations are likely to include:
- Speed Cost • Quality • Specific project constraints • Risk
- Asset ownership Financing
Masterman (2002) classified construction procurement into four systems: Separated, Integrated, Management Oriented and Discretionary.
1. Separated or ‘Design-Bid-Build method’
- Based on a linear and sequential process with little or no parallel working
- The design is the responsibility of the Client, and the implementation is that of the contractor.
- Client prepares the brief, followed by the appointment of a consultant/designer as project’s leader, who develops and finalises the detailed design
- Competitive tendering starts once detail desi n is co plete
- Tender is based on full detailed but approximate Bill of Quantities
- Types: Re-measurement Contract with approximate Bill of Quantities, schedule of rates or cost reimbursement
2. Integrated or Design & Build (D&B)
- known as design-and-build, design and construct or one-stop-shop .
integration of the design and construction at the same_ time
- the contractor assumes full responsibility for the design and construction under one single financial transaction
- Types: Conventional D&B, Novation D&B, Develop & Construct, package deal, and Turnkey
3. Management Oriented
- Originated in Sweden and developed in t e USA.
The Contractor is appointed on a professional basis as an equal member of the design team providing construction expertise.
- The Contractor manages and coordinates the inception, design, and construction phases of the project, through the entire project
- Reimbursement is based on Lump Sum or percentage fee for the management services plus the prime cost of construction
- Types are: Management Contracting, Construction Management and Design and
- Administrative and cultural framework
- Client imposes very specific management style or culture Any optional means of controlling the project by the Client
- A strategy that satisfies client’s development and/or operational needs
- Types are: Partnering, PPP and PFI
An in-depth into the various categories and types may be addressed in the next article.
First Edition (March/April)
Mohammed Elaida MCIOB
Mohamed holds a Master’s degree in project management; he is a chartered construction manager, a chartered commercial manager, examiner and Malta representative of the CICES.