Collaborative Procurement 1

8/11/2019 Collaborative Procurement 1

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6CN008CQS (Management)

Collaborative Procurement andOGC Gateways model (1)

1

Understand the term construction procurement

Explore the different options for achieving collaborativeprocurement

Examine the relevance of the Gateways approach


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Procurement concerns...

ActivitiesDesign

Demolition

Managing theproject

Leasing or managing

facilities

Financing

Commissioning

Construction

Land acquisition /selection


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Context of Construction Procurement

3

Employer

Contractor

Contract Administrator (CA)

Consulting Engineers

Quantity Surveyor

Designers

Named Specialist Sub-contractors

Sub-contractor

Suppliers

SuppliersSuppliers

Tenant

Funder

Principal

Contractor

(CDM)

CDM

Co-ordinator

Principal

Contractor(Waste)

Public Utilities (Water/gas etc)

Designer/Sub-contractors

Employers

Representative ?

[admin]

Pre-Appointed

Consultants

Purchaser


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Impact of multiple stakeholders


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Sir Michael Latham: Constructing the Team

(1994)

Aims: Concerning construction practice

Reduce conflict & litigation

Improve productivity & competitiveness

Main call was for integrationof the supply

chain and collaborative working between the

supply chain partners


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Sir Michael Latham: Constructing the Team

(1994)

Partneringrelationships are also beneficial betweenfirms. Some main contractors have developed long term

relationships with subcontractors. That is welcome.

Such arrangements should be the principle objective inimproving performance and reducing costs for clients.They should not be cosy. The construction process

exists to satisfy clients. Good relations based on mutualtrust benefit clients

This recommendation and its subsequent adoptionmarked the beginnings of collaborative procurement


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After Latham Rethinking

Construction by Sir John Egan (1998)

The Egan strategy also advocated:

Partnering

Benchmarking Supply chain management

Improved product development

Improved component Production New delivery mechanismsCBPP andM4I(Construction Best Practice Programme. Movement for Innovation)


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Rethinking Construction by Sir John

Egan

A team that does not stay together has no

learning capability, the concept of allianceis

therefore fundamental to our view of how

efficiency & quality can be improved

Reinforcing Lathams call for collaborativeprocurement


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What does collaborative

procurement mean, practically?

Partnering


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The Key To partnering!


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Partnering - A definition

a structured management approach to

facilitate teamworking across contractual

boundaries

can be used by two or more organisations to

achieve specific business objectives by

maximising the effectiveness of each

participants resources.

Bennett and Jayes (1998)

COLLABORATION is the key!


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All are involved in th e

partner ing proc ess

Main

Contractor

Specialist

Contractors &

Suppliers

ClientPartnering

Partnering

Partnering

Partnering

Partnering

Professional

Team

Partnering - Relationships (1)


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Back-to-back partner ing

agreement

Specialist

Contractors

Client

Service Provider

Partnering

Partnering

PartneringRelationships (2)


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Parties in partnering

Constructor:

single point responsibility for the design,

supply, and construction

Must complete the project on a fitness for

purpose basis.

Specialists

A Partnering Adviser


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Three Essential Features of Partnering

Partnering

Cornerstones

From Partnering in the Team, Construction Industry Board (1997)

MutualObjectives

Continuous

Improvement

Problem

Resolution

Partnering


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Keys to successful partnering

Proper planning of mutual objectives

Charter to which all adhere

Workshops so ALL value the whole project Open book throughout supply chain

Gain (or pain) share

Collective decision making Real benchmarking for improvement

Project bank account???


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The Seven Pillars of Partnering

StrategyDeveloping the

clients objectives.

How the team can

meet these on the

basis of feedback.

EquityEnsure everyone

is rewarded for

their work on the

basis of fair

prices and fair

profits.

MembershipMaking sure all

the right firms

are involved to

ensure all

necessary skills

are available.

Processes

Establishing

standards andprocedures that

embody best

practice.

IntegrationImproving the

way in which

firms work

together by using

co-operation and

building trust.

Feedback

Capturing

lessons learnedfrom experience

and others to

enable future

improvement.

Benchmarks

Setting

measurable targetsthat lead to

continuous

improvements in

performance.

Source: (Bennett and Jayes, 1998)


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Upsides of partnering

Decent margin for all

Satisfied customers and end users

Repeat business

Enhanced reputations all round Improvement in the business planning process

Enables businesses to set tough stretching targets

Continually building a more robust industry

Improved Communication

Fewer disputes

Promotes innovation

Reduced costs and better project quality


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This is more like it !


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Documents

Collaborative Procurement 1