Collaborative Procurement 1
Transcript of 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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