Summary
Intro
What is early contractor procurement?
Early Contractor Procurement is a way to get the contractor involved before the construction phase begins, (Mosey, 2011). The idea of this is to make use of the contractor and their knowledge and understanding of the construction industry. This means fewer disputes over design issues.
When the client has invested time and money into design, and the contractor isn’t involved, and then is expected to complete all the work, it is likely for there to be disputes but the client would be missing out on the contractor’s ideas on how to save on costs. So is partnering up early on and getting to know the job, the client and its goals the right way to go?
When this is done it is called partnering. Construction partnering is when the owner, consulting engineer and the contractor, get together to improve communications and avoid disputes by working together towards shared and common goals and objectives on a project (Broome, 2002).
Partnering in the recession
As we all know the construction industry is going through an unstable period, this means that there is a lot of cynicism and suspicion, where contractors will put in hazardously low bids in tenders, and the clients are often tempted to accept them.
But really the contractor just wants to get their foot in the door then exploit the client by picking holes in their design work, and then having to ‘re-evaluate’ their offer once the contract is signed.
There was a recession in the 1990’s due to claims and insolvencies that led to the 1994 Latham report, Latham’s work improved construction practices, from new contract forms to encouragement towards partnering as a means to deliver good value (Latham, 1994), cited in (Mosey, 2011). Yet a...
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As the United States economy struggles through a sluggish time with the stock market dropping and unemployment rising, being competitive in the job market has become extremely important among professionals. Engineers are no exception. For most engineering firms, being competitive and successful requires obtaining design projects offered by companies in other fields. These projects can range from designing heating and ventilation systems for office buildings to water systems for cities to computer networks for businesses—the list of possibilities and disciplines is extensive. To get these jobs, engineers must make a bid proposal for the project. Bidding involves estimating the entire cost of the project, including the designing and building processes, as well as the materials and labor. Usually, the company with the lowest bid and the best plan gets the job. The ethical issue in this process is determining the cheapest building materials and construction procedures possible without compromising public safety.
Currently, XYZ Construction Inc. receives a majority of their contracts from the state government. The purpose of this essay is to analyze and discuss ethical and social issues, along with cultural diversity when expanding
When we see an economic downturn many of the different industries are affected in different ways depending upon their demand. The industry which always seems to be affected first and the last to recover is the construction industry. The construction industry is one of the largest sectors of the UK’s economy. It contributes around £90billion which is 6.7% of the total and 2.9 million people are employed within the construction sector. (HM Government, 2013) (Barawas and Fleetwood et al., 2013) This contribution is measured by the Gross Value Added (GVA), here below is a table to represent the contribution the construction industries GVA (for 2012 prices) and its % of economy.
...hing that was not ever the easiest type of contract to navigate but over the years the requirements have continued to get more complicated and require a lot of additional effort on the contract and the contracting officer. A contracting officer does not just accept the data supplied by the supplier as acceptable. A contract officer will have to perform due diligence and verify the information submitted. This means that the contracting officer will have to verify the material costs, the labor costs, the travel costs, and any of the data supplied.
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Martin, M.W. and Schinzinger, R. (2005) Ethics in Engineering. 4th ed. New York: McGraw Hill.
A few sailors in the Navy were builders, but the sole Military Occupational Specialty held by those men was Construction, which did not provide enough diversity in skills to make them very effective. Although contractors were the better option at the time, the contracting system was ridden with problems. Every contractor was required to reach a government-set qualification level before beginning work. Congress had to authorize every contract, and the payment type was decided on a case-by-case basis. Some contracts were unit-price payment, others were lump-sum, others were paid on a loan, and still other prices were calculated at the end of the project based upon man-hours, materials cost and similar factors (known as an informal contract, and was the most expensive of all contract types) (Bingham 77-80) Furthermore, every project was carried out using a predetermined amount of supplies, again negotiated with Congress. If more supplies were needed, the contracting business went through Congress to re-negotiate the contract for more supply
With a variety of procurement routes to choose from, how can one facilitate the selection of the most appropriate construction contract and avoid situations where the owner insists on using a less appropriate one? How do we begin to focus the conversation on training, and updating efforts to create a reduced number of documents (Construction Canada, 2014)? In the next chapter this dissertation will further analyse the trends and investigate how different procurement routes naturally align themselves in certain asset classes in
The history of construction management was not a shock, but it was a little bit of a reality check. It is common knowledge that the human race has been building things since the beginning of time, but what is extraordinary is to think about how far the world has come over the thousands of years. Men and women started living in small huts. Now there are skyscrapers that reach thousands of feet into the air.That is a drastic change in the way construction has developed. As I researched
Disputes are almost unavoidable between people when there are disagreements or misunderstandings. In the construction industry, contractual relationships could lead to dispute. To resolve disputes, construction disputes are most likely encouraged to use Alternative Dispute Resolutions such as arbitration, mediation, and mini-trials to resolve their disputes faster and keep the dispute confidential and at lower cost (Ray, 2000). The construction case presented in this paper first resorted to negotiation; however, it could not give the parties a resolution which led to a mini-trial.
..., 2013). As these contractors are risk-averse, they will drop out in the first phase leaving only the most efficient contractors to compete against each other. Furthermore the inclusion of a premium, offers less incentive for collusion as contractors are more inclined to deviate from a cartel to receive a higher payoff. Although theoretically feasible in a controlled environment, in real life there are laws and regulations that protect firms against collusive practices. In the case where the client may suspect collusion is a real possibility, AMSA offers the most effective collusion deterrence. However administratively it may be difficult to implement phase 1, where the price sequentially drops as the tender process takes several months with contractors rarely interacting with each other compared to an auction where the bidders are together and bid in one sitting.
This paper explores what it takes to be a construction manager and the responsibilities of being a construction manager and the skills that a construction manager should have. It also explores what good construction managers do to have success on their construction projects and the steps that a construction manager must follow to end a project and meet their deadlines at the same
Furthermore, there is good price certainty at the award of the contract because of full set information. However, there are some disadvantages to the process. First, it is very consume time in the pre-contract process due to the strategy is sequential and construction cannot be started before the completion of design. Also, the contractor is not appointed at the design stage, so the contractor and supply chain have no input into the design or planning of the project. Moreover, there are divided responsibility of design and construction, so it is easy to cause disputes in the post-contract processes.
Scott Jardine, 2007, “Managing risk in construction projects – how to achieve a successful outcome – an article”, PricewaterhouseCoopers.
This paper examines the legal aspects of procurement management and specifically how procurement management can be used as an effective tool for the overall management of a project. This paper focuses on the basics of common contract laws, the basics of agency law, the Uniform Commercial Code (UCC), and some aspects of that pertaining to the Federal Acquisition Regulations (FAR). A summation of the company’s position in relation to a given supplier (provided the company decides not to procure all of the material in a contract) will be examined along with how that position is strengthened by understanding the legal aspects of procurement management. Finally, the paper will analyze how the project manager is supported by the contract management function. Fleming (2003) posited that there is a clear and important distinction that should be made that delineates the work of the project from the inside work of the company.