Procurement Flashcards
Definition of procurement
the act of getting possession of something
Two reports that prompted change in procurement
Lathan 1994 and Egan 1998
What did Lathan and Egan prompt?
Change in roles and responsibilities
focus on client, team building and relationships
What did Lathan and Egan prompt?
Change in roles and responsibilities
focus on client, team building and relationships
7 client considerations for procurement
Financing
Speed
Cost/value
Asset ownership
Specific project constraints
Quality
Risk
5 types of procurement
Traditional
Design and Build
Management Contracting
PPP/PFI
Prime Contract
Most common form of procurement
Traditional
(Design and Build)
What is the designer/consultant responsible for in traditional procurement
Design and quality
valuation and payment
why is traditional procurement produce a high standard?
Designer retains control of design and quality
Why is traditional procurement slow?
Need adequate time before tenders are invited
Advantages of traditional procurement
High standard, designer retains control of the design
Disadvantage of traditional procurement
Slow, need adequate time before tenders are invited
Can traditional procurement be used with approximate quantities?
Yes
What does the promotor do in design and build procurement
Financing
maintenance over specific period
client not necessarily the owner of the property
Why might d&b procurement be used (3)
Need an early start on site - design and construction phases overlap
Minimise risk as client is not responsible for design
benefit from contractors expertise
What is the role of the project manager in management contracting?
Pre planning
procurement
coordination of design and contracting
What is management contracting?
Individual organisation responsible to management on behalf of a client - project manager
Why use management contracting?
No in house capability
Client no experience with capital development
Example of a bad PPP
Oxgangs Primary School Edinburgh
Collapse of external facade
Advantages of PPP
Takes risk away from client as privatises services from government
Long term commitment from contractor
Reduced rents as a result of penalties
What is PPP/PFI
Projects commissioned by a public client
Disadvantages of PPP
lack of accountability as the public client has very little involvement in the construction and design phase.
Who uses prime contract?
large client and supply chains
Advantages of prime contract
clear lines of accountability
improved supply chain management
economics of scale
saves time
long term improvement and partneships
Disadvantages of prime contract
excludes small companies
layering of overheads and profit
difficult to detect fraud
best procurement method for projects up to £5m
Traditional
D&B
Best procurement method for between £5 - £50m
D&B
Traditional
Best procurement method for over £50m
D&B
Most significant problems arising during the procurement process
Alterations of client requirements
Lack of communication
Issues over responsibility
