Professional Documents
Culture Documents
0 PROCUREMENT METHODS
ATGB3663 BUILDING ACTS AND CONTRACTS
Tunku Abdul Rahman University College
Faculty of Engineering and Built Environment
Department of Quantity Surveying and Real Estate
Procurement Process
Initiation / Inception / Feasibility Studies
Funding
Pre-contract
stage
Tendering
Construction
Post-contract
stage
Procurement Selection
Factors to consider in selection an appropriate procurement
methods:
Size
Design
Accountability
..
Organization
Risk
Finance
TRADITIONAL
PROCUREMENT METHODS
SEQUENTIAL
ACCELERATED
Traditional Methods
Sequential
Competitive
tender
Accelerated
Negotiated
tender
Traditional
Traditional Methods
The contract requires the contractor to carry out the
construction according to the drawings and specification
drawn up by the design team.
All work is supervised on behalf of the client by the design
team leader, which is normally the architect or on civil
engineering projects, the Consultant Civil Engineer.
Traditional Methods
Responsibility
Employer
Contractual Link
Professional Team
Main Contractor
Sub-contractor / Supplier
Nominated Sub-contractor
Traditional Methods
A Fixed Price Contract involves the contractor agreeing to
construct the building as specified in the drawings and Bills of
Quantities (BQ) for the client for an agreed sum, by an agreed
date.
Although it is called a fixed price contract it does allow for the
contractor to claim additional costs for any variations to the
specification.
Allowance can also be claimed by the contractor for an
extension of time if there is a delay which is beyond his
control.
Traditional Methods
When constructing new buildings it is possible to assess the
cost of the work to be done, in which case a fixed price can be
the basis for the contract.
A fixed price can, however, be on the whole contract, a section
of work or can apply to a unit rate. The price is fixed although
the amount of work is not known.
Inception &
Feasibility
Study
Design
Tendering
Construction
Handover &
Maintenance
Inception &
Feasibility
Study
Design
Tendering
Construction
Handover &
Maintenance
..
Minimizes professional conflict
PACKAGE DEAL/INTEGRATED
PROCUREMENT METHODS
DESIGN & BUILD
TURNKEY
DEVELOP & CONSTRUCT
Package Deal
Commonly called the all in contracting.
A contractor is given the responsibility for everything that is
required and necessary for the design, construction and
delivery of the project.
The services of the contractor will include the preparation of
project brief, sketch and final working drawings, getting all the
approval from authorities, project financing, construction,
furnishing and commissioning of all equipment and accessories
and handing over the project to the client.
Package Deal
Inception &
Feasibility
Study
Design
Tendering
Construction
Handover &
Maintenance
Package Deal
Employer
Responsibility
Professional Advisor
Contractual Link
Main Contractor
Professional Team
Sub-contractors/
Suppliers
Sub-contractors/
Suppliers
Turnkey
Turnkey contract is an American term for all in or package
contract. Under this arrangement, a contractor is
commissioned to undertake the responsibilities for everything
necessary and required for the construction, completion,
commissioning and hand over the project.
The word turnkey means that, upon completion, the client is
given the key and he can then enter the project by turning
the key. The contractor will have to do everything from
preparing project brief, getting approval, designing, financing,
construction, furnishing and decorating to commissioning and
handing over completed, cleaned and ready for use project.
MANAGEMENT ORIENTED
PROCUREMENT METHODS
MANAGEMENT CONTRACTING
CONSTRUCTION MANAGEMENT
DESIGN & MANAGE
Management Contracting
Fast-tracking procurement approach. A contractor is
contracted and paid a fee to manage, procure and supervise
the construction of a project rather than to build the project.
Management Contracting
Inception &
Feasibility
Study
Design
Tendering
Construction
Handover &
Maintenance
Management Contracting
Work / Trade Contractors
Work / Trade contractors enter into a contract with the management
contractor to carry out construction work.
It is the management contractor who has a contractual relationship
with the subcontractors who carry out the work, not the client.
If any problems arise it is the management contractor who must
pursue the subcontractor for a remedy.
Management Contracting
Employer
Responsibility
Contractual Link
Professional
Team
Work Contractor
Management
Contractor
Work Contractor
Work Contractor
Management Contracting
To Contractor
To Developer
Construction Management
Construction management is similar in most respects to
management contracting except that whereas with
management contracting the contract is between the client
and the contractor (the subcontractors are engaged through
the main contractor) in construction management the
contracts for the work packages are with the client.
The construction manager is employed to manage the
construction work. This system tends to be used only on large,
specialist technical projects such as power stations.
Construction Management
Inception &
Feasibility
Study
Design
Tendering
Construction
Handover &
Maintenance
Construction Management
Project Manager
May be an organisation or an individual.
Guides the client in the selection of a suitable procurement
system, appoint all members of the construction team and
control and organise the project.
Appointed on a fee basis, which is not dependent on the cost
of the contract. This tends to ensure that the project manager
works solely for the client's interest, as he earns no
commission.
Construction Management
EMPLOYER
PROFESSIONAL
TEAM
Responsibility
Contractual Link
MANAGEMENT
CONTRACTOR
WORK
CONTRACTOR
WORK
CONTRACTOR
WORK
CONTRACTOR
Responsibility
Contractual Link
PROFESSIONAL
TEAM
DESIGN AND
MANAGEMENT
CONTRACTOR
DESIGN TEAM
CONSTRUCTION
CONTRACTOR
Management
Contracting
Package Deal
Management
The client is
committed to start
building on a cost
plan, project
drawings and
specifications only.
Package Deal
Management
THE END