Introduction
In this essay I will compare and contrast the key factors that would influence the procurement of your project if it was procured publically using the design and build method or privately using the traditional RIAI method. The term procurement means the process of obtaining goods and services from someone for some consideration.
Traditional Procurement
Traditional procurement usually involves a client that will appoint some consultants to produce a design as well as select a trusted contractor and supervise the work through the different stages until its completion. The contractor that is appointed usually selected through competition and is solely responsible for the facility delivery and quality of the work that is done and the materials used, this also includes the subcontractors. This process has been used several times over the last while and continues to be a very popular method. Procurement is traditionally is used in a vast range of projects including ones that have great risks attached to them, which in advance the contractors would not be able to establish, they are often used on such projects as refurbishment, heritage and alteration. The approach that is taken to this is probably not being suited to these complex projects that require advanced management systems, skill and structure. The developers as well as the employers can take advantage of the in-house design and management services or they can also choose to repeat an existing standard design may favour the approach to this.
The approach that is traditionally taken towards procurement can be linked with projects where the employer put the aesthetic and quality of the project above all else, it allows them to continue having control over the qualit...
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... This should result in fewer complications arising from variations and late information delay claims during the construction stage.
The success of this method is mainly dependent on the ability of the employers to produce a project brief. This process usually takes a good deal of time and concentration to get correct. If the project brief is wrong then the project ill turn out to be a failure and cause the employer to lose a lot of money. It takes time and money to fix these problems if they arise. In Ireland the design and build contractors have tended to use different drafted contract documents or even the RIAI form of contract. The Society of Chartered Surveyors has issuer the guidance to get ready the design and build contracts. The public sector design and build projects are now under different control as the GCCC have taken the design and build contracts.
Based on the textbook and my understanding, whenever there are negotiations between a procurer and a supplier regarding a competitive bidding, the first thing that might be favored is the scope of the project, meaning both will sit down and discuss the entire project prior the work begins. Meanwhile, during the negotiations, evaluation criteria should be clear, and stated and defined. As the evaluation is based on the criteria stated and the procurer can request or ask the supplier’s opinions on certain specifications and where things can be improved.
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.
The construction of a building or buildings is a complex process which includes numerous parties and various different activities. Large projects need the cooperation of many organizations including clients, architects, engineers, financiers, builders and subcontractors while even small projects are beyond the extent of a single organization to complete in isolation. The domain knowledge of involved parties are different and effective completion of the project requires intense cooperation during design, manufacture and maintenance/management of the system.
Tendering method: • Opening tendering - The employer advertises his proposed project, and permits as many contractors as are interested to apply for tender documents. Open tendering has been criticised for attracting tenders / expressions of interest from large numbers of suppliers, some of whom may be entirely unsuitable for the contract and as a result it can waste a great deal of time, effort and money.
Tender documentation usually includes the Bill of Quantities, a works schedule and plan and any drawings made up by the consultants. At this stage tenders can be submitted by contractors. These tenders are submitted on a single-stage, competitive basis in order to determine a main contractor for the project. The main contractors are not responsible for the design in this case instead the client will keep the design consultants during the construction of the project as they are required to solve any design flaws that arise during the building
A project is a temporary endeavour undertaken to create a unique product or service. They are goal oriented, have a definite start and finish time, must be done within cost, schedule and quality parameters. Projects involve the coordinated undertaking of interrelated activities (Project Management: Achieving Competitive Advantage). According to Tom Peters, “Projects, rather than repetitive tasks, are now the basis for most value-added in business”. Based on this, it is clear that projects are of utmost importance to businesses in both the service and the manufacturing industries.
Wideman, M., (1993). Project Management Case Study The Custom Woodworking Company - Woody 2000 Project. [ONLINE] Available at: http://www.maxwideman.com/papers/woody2000/intro.htm. [Last Accessed 24 April 2014].
If the contractor is entirely responsible for design a great deal of time can potentially be saved as the design and building elements will run concurrently. For developers the main benefit is that, once the contract is agreed the contractor takes on much of the financial risk inherent in a project; that 's increasingly attractive when prices of both labour and materials are looking likely to rise. When various political parties claim that an upswing in construction is just around the corner, it 's worth remembering that it 's not just the taxpayer who will be expected to contribute. The Conservative government will also need to rely on private
Vrijhoef, R. and Koskela, L. (2004) ‘The four roles of supply chain management in construction’, European Journal of Purchasing & Supply Management, 6(3-4), pp. 169-178 ScienceDirect [Online]. Available at: http://www.sciencedirect.com/ (Accessed: 6 February 2010).
Previous researchers have shown that there is a positive relationship between cooperation and satisfaction (e.g. Mallen, 1963; Dwyer, 1980; Schmitz Whipple and Gentry, 2000). The cooperative efforts of channel members should results in greater trust, commitment, channel efficiency and the achievement goals, thus leading to higher levels of satisfaction. (Jonsson and Zineldin, 2003).
In the world of fierce competition between businesses, some of the utmost important decisions that organizational leaders face are decisions related to the projects they agree to undertake. Every organization has to determine how to make their product or service stand out, this typically leads to project proposals. The majority of organizations have a process, some formal and some informal, to select and prioritize projects. Once a project proposal has been submitted to the organization, there are various factors that need to be considered before the project is to officially begin. The selection process is a process that assesses each project idea and ultimately helps leaders select projects that further meet the organizational goals.
The key performance drivers of Supply Chain Management (SCM) are - facility effectiveness, inventory effectiveness, transportation effectiveness, information effectiveness, sourcing effectiveness, pricing effectiveness, delivery effectiveness, quality effectiveness and service effectiveness. These drivers include various performance markers that may be measured quantitatively by gathering information and applying them in SPSS. The works here may principally be quantitative with spellbinding measurable investigation. In the current world, practical supply chain management to help the triple primary concern, (nature, domain, and economy) is likewise included in the extent of supply chain performance drivers. This is relatively a quite new research region.
(2014) deduced that procurement performance can be assessed by focusing ondelivery,flexibility, quality, cost and technology. Optimal performance attainment is dependent onhow current suppliers`relationships aremanaged so asto ensure constant availability of needed quality supplies at the organization. This will ensure that sourced materials are indeed procured at the right costand atthe right time. Procurement performancestrives toenable improvements in the procurement process at the organizationso as to improve on qualitydelivery of firm products and servicesatleast possible time and
In general, there are different types of procurement type for various situations due to no one method can be suitable under the all different construction project. In this case, there are four procurement paths, which are traditional, design and build, management and design and manage, will be advised to use. However, each method has different aspects of advantages and disadvantages.
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.