Procurement Routes and Strategies - Coursework Example

Case Study on Procurement Routes and Strategies Name: Course: Institution: Date: Introduction Following the plan by the government to host an international competition in 3 years, the organizers of this event have been tasked with the responsibility of using the event for the regeneration of a typical slum in the city. In addition, the organizers also have the responsibility of using the event to provide employment opportunities to the local residents while at the same time improving their businesses among other initiatives. It is important to note that through this event the government endeavours to improve on the housing sector by constructing a state of art games village and the construction of about 600 homes foe rentals after the games. One of the themes in these games is the promotion of a green image and this can only be realized by using energy products which are not only sustainable but also renewable. The main objective of this paper is to demonstrate the development a strategic approach to procurement. The report will also analyse existing procurement alternative and recommend the most suitable root for the project. A strategic approach to procurement The procurement process is often considered as a reflection on defend initiatives that an organising committee of the government must undertake to ensure that there is adequate supply of materials or services and this is inclusive of the systems that the procuring team must undertake from the conception of the project to its evaluation (Erridge et al, 2001, p. 220). It is important to note that through a strategic approach to this process the organizing team will be able to plan on how to acquire, pay and ensure effective closure of procurement contracts (Turner 2011, p. 64). A strategic approach to the procurement process involves understanding the impending challenges associated with the project and generating effective initiatives that will provide long term solutions to the challenges (Erridge et al, 2001, p. 221). It is important to note that the organization of an international games event in three years’ time requires the development of effective procedure in the management of the entire project (Turner 2011, p. 64). This is because the process of procuring materials and services for such a project involve complex inter-organisational networks of suppliers, producers of different products that are involved in the construction projects, construction and service teams, company representatives and different stakeholders such as the citizens whose involvement in the project will ensure effective ownership, provision of employment opportunities and an improvement of local businesses (Russill 2010, p. 140). A strategic approach to the process can only be realized through collaboration of the concerned parties. This includes reconnecting the purchasing points as ways of ensuring that the organizing team acquires the best materials and services art a relatively lower price (Erridge et al, 2001, p. 221). It is also one way of ensuing effective management and distribution of available resources. This is because the government has a responsibility of ensuring equitable distribution of resources. In a project such as the organization of international events, the government must involve local companies and businesses in the procurement process (Turner 2011, p. 66). It is important for the team of organizers to recognize that the need for a proper understanding on how to leverage network resources especially in sectors that are highly regulated relatively complicated public sector systems (Turner 2011, p. 65). This means that in areas such as the medical field and the construction sectors, who input is considered essential in the success of the project, the organizing team must involve the input of the governing bodies in these sectors in the creation of innovations that will bringing a network of major players together, offer facilitation of the process and help the organizing committee with indicatives on how to keep improving on its procurement strategy in relation to ensuring that it receives the best value for the money engaged in making procurement decisions and acquiring desired products and services (Erridge et al, 2001, p. 221). Through such an approach, the organizers of the committee will be able to ensure effective operations of its initiatives irrespective of the procurement method that is undertake for the project (Russill 2010, p. 155). In addition, a collaborative approach in the development of a procurement strategy will also provide avenues for the organizers to save on good s and services as they will be acquiring value for the money invested in the project (Turner 2011, p. 70). It is important to note that through a strategy approach to the procurement process the organizing team will be able to develop long-term considerations which are inclusive of effective and competitive markets, initiation of sustainability requirements. This in turn will allow the organizers of the event to be engaged in the process of selecting the most appropriate procurement procedures in the development of procurement policies (Erridge et al, 2001, p. 221). Critical analysis of alternative procurement routes/types for the proposed project Traditional procurement routes This procurement procedure is characterized by the initial appointment of the designer and consultants by the organizers of the event before calls for tender are made. This procurement process is also characterized by the appointment of the contractor after the tender (Broome 2002, p. 67). Through this process the organizers of the event are the managers. It is important to note that through the management of the organizers, there are no concurrent sequence works that must occur by following one another such as brief, design, tendering and construction (Emmitt 2007, p. 40). Design and build (D&B) procurement route D&B procurement route is often considered as an alternative to traditional procurement procedures. This process requires the organizers of the event to be engaged in the development of tender documents (Broome 2002, p. 68). The documents are sent to the contractors to enable them to provide and return their design proposals for the construction and the use of renewable energy resources are the most essential aspects that are considered outstanding while using this procurement route is that the contractors must explain the relevance of their costing techniques (Emmitt 2007, p. 40). The main intention of using the design and build procurement route id to ensure that the designs of the contractors meet the intended needs of the clients from a single point of responsibility as this is always perceived as an attempt to minimize client risk while at the same time controlling the overall costs of the project (Turner 2011, p. 24). Design and build procurement route unlike the traditional procurement method it allows the contractor to initiate procedures that could help in the reduction of project duration. Through this route the management of the event extends the responsibilities of commissioning and the fit-out of the facilities that are to be constructed for the project (Emmitt 2007, p. 44). Design and build procurement procedure can also be organized in two stages and these include the tendering a stage and the novation stage (Emmitt 2007, p. 44). These stages give the client, the organizers of the events, more control over essential factors in the realization of the project. These include control in design and cost of the project. The design of the project will dictate the ability of the project to be constructed in the available space as envisioned by the government. In addition, though this process the client will ensue that the cost of the event is in accordance with the envisioned plan (Russill 2010, p. 110). Management procurement routes This process allows the client to appoint a construction manager whose responsibility is to provide advice on the basis of an agreed fee. The decision to use this procedure requires a client to be get into contracts will different contractors at different stages of developing the proposed project (Emmitt 2007, p. 23). It is important to note that there is procedure is only applicable in situations where the client is experienced in the field but only needs contractors for their advisory role (Broome 2002, p. 69). The advisory role of the appointment contractors is to provide guidance on the buildability of the intended projects. The client through his project team is able to implement the requirement of the project according to the advice provided by the client (Bower 2003, p. 228). There are however underlying risk such as uncertainty of the costs of the costs that are to be incurred in the realization of the project and the duration that the project is expected to undertake (Bower 2003, p. 229). Examination of advance procurement practices suitable for the project For the organizers of the international games event to realize any form of success, it will be important to engage in the development is the deliberation of the steps that are considered essential in the development of effective steps of procurement (Great Britain 2006, p. 13). One the best practices that the organizers of the games event can undertake is conducting needs analysis (Emmitt 2007, p. 67). Through this practice it will be easier for the organisers to assess the procurement procedure on the basis of its ability to provide optimal solutions (Russill 2010, p. 135). The project envisions employing the use of green and renewable energy to define the main theme of the games. The highest bidder in the tendering process must demonstrate the ability to satisfy the existing need for green energy and proper housing. It is also essential for the organizers of the international games event to acquire funding approval from the government. Through this approval the organizing team will be able to determine the scope for the project and ensure the development of a business case for funding (Emmitt 2007, p. 68). In addition, it will also enable the project to work in accordance with the budget while at the same time imitating procedures that will help in acquiring the best quality of work at a favourable cost (Great Britain 2006, p. 18). Project procurement planning is also a practice that the organizers must incorporate to ensure that there are adequate mares for developing a strategy for approaching the market. This is one way through which the strategy will ensure that the objectives of the project are achieved (Russill 2010, p. 160). One of the best practices in the procurement process is to develop an effective way through which product and service providers are selected. This will include an evaluation of responses, an effective negotiation process and the decision to award contracts to successful bidders (Etats-Unis et al 2006, p. 111). It is important to note that in the process of selecting service providers, the organizing committee for the project will have the responsibility of determining the best bidder from their designs and pans in terms of the managing of the available space, and their ability to not only provide state of the art building and facilities but also the long-term plan for the project in future (Mead et al, 2013, p. 40). Contract management is also considered as part of best practices in the procurement process. This is the transition point between the contact and the management of performance (Russill 2010, p. 156). Procurement evaluation is also a process that will help the organizing team in ensuring effective assessment of the service provider and the value that the team has acquired for the money invested (Mead et al, 2013, p. 56). In addition, the organizing committee will also use the evaluation process to assess the ability of the service provide to work according to the plan and the set objectives (Abramson et al 2003, p. 420). Factors would influence the development of an appropriate procurement strategy and how it could be implemented External factors are considered to be influential in the development and implementation of the procurement process. These are considered essential due to underlying potential impact on the economy, culture and politics of the country (Svensson 2007, p. 34). The project is a government imitated project and it is susceptible to political challenges especially on matters related to the awarding of contracts to successful bidders. Politically motivated actions may not only influence the process but also the overall implementation and success of the project (Great Britain 2006, p. 34) Client characteristic are also factors that affect the development of a procurement strategy considering that the client’s knowledge and experience on the requirement of the construction process including the environment within which the project operates will have an influence on the procurement strategy that is adopted (Svensson 2007, p. 36). The objectives of the client are often influenced by the nature and culture of the environment as this influences the degree of client involvement in the entire process (Aartsengel et al 2013, p. 304). Cost issues which are inclusive of the assessment for certainty in price by the client must be undertaken considering that there is relative delay from the initial estimate to the time when the tender is received (Aartsengel et al 2013, p. 304). Cost issues are influential factors in the design and implementation of the strategy because the extent to which a design is completed will be influenced by the cost at the time of the tender. It is important to note that is certainty of price is a requirement then it will be a requirement for the design to be completed before construction begins to avoid the possibility of design changes (Great Britain 2006, p. 35). Timing is an essential factor considering that most projects are required within a specific time frame. The country is planning to host an international sports event in three years’ time. It is required for the team of organizers to execute all their responsibilities in three before the competitions begin. This means that it will be a requirement for the design to be completed before the construction process begins. It will also be important for the design team to provide assurances on the resources that will be needed to execute the project considering that earlier approval of these resources are critical in ensuring the timely completion of the project (Svensson 2007, p. 37). If the project demand early completion then it will also be important to overlap design and construction initiatives as this will be important in the evaluation of time and cost trade-offs (Aartsengel et al 2013, p. 304). Most suitable route and state the potential benefits of adopting the chosen procurement route Design and build procurement route is considered as the best method of procurement considering that it is suitable for both experienced and inexperienced clients. One of the greatest benefits of this procurement route is that the responsibility for the design and the construction is on the main contractor (Broome 2002, p. 68). The contractor has the role of employing in –house designers to execute different role s and in some instances; such the development of green energy to help in the generation of renewable sources of energy may require the employment of energy consultants to assist in strategizing (Emmitt 2007, p. 7). Inasmuch as the contractor bears the responsibility of the design and the construction, it is important to note that bulk of construction work under the build and design procurement rout e is executed by specialist or sub-contractors (Russill 2010, p. 158). The design and build approach provides clients with a single point of contact. Through this procurement route, the client, the organizers of the event and the government, commits the cost of construction and the cost of design at an earlier stage of the procurement process (Emmitt 2007, p. 7). Despite the fact that the risk is shifted to the contractor, these design liability insurance is often maintained to cover the risk involved. Inasmuch as there are underlying benefits any changes to the design can be expensive considering that such changes affect the entire design and build contact instead of the design team cost (Russill 2010, p. 159). Conclusion The intention by the government to host an international competition can only be realized through the introduction of effective procurement strategies. It is the responsibility of the team of organizer to ensure that there are adequate measures in the assessment of the best procurement routes such as the build and design procurement strategy that will not only execute responsibilities according to the desired objectives but will also deliver on its responsibilities according to the prevailing factors that determine the development and implementation of procurement plans. References Aartsengel, Aristide van, and Selahattin Kurtoglu. 2013. Handbook on continuous improvement transformation the lean Six Sigma framework and systematic methodology for implementation. Berlin: Springer. http://dx.doi.org/10.1007/978-3-642-35901-9. Abramson, Mark A., and Roland S. Harris. 2003. The procurement revolution. Lanham [Md.]: Rowman & Littlefield. Bower, Denise. 2003. Management of procurement. London: Thomas Telford. Broome, Jon. 2002. Procurement routes for partnering: a practical guide. London: Thomas Telford. Emmitt, Stephen. 2007. Aspects of building design management. London: Earthscan. Erridge, Andrew, Ruth Fee, and John McIlroy. 2001. Best practice procurement: public and private sector perspectives. Aldershot, Hampshire, England: Gower. Great Britain. 2006. Using the contract to maximise the likelihood of successful project outcomes: report. London: Stationery Office. Mead, John, and Stephen L. Gruneberg. 2013. Programme procurement in construction learning from London 2012. Chichester, West Sussex, UK: Wiley-Blackwell. http://www.123library.org/book_details/?id=93919 National Cooperative Highway Research Program (Etats-Unis), and Sidney Scott. 2006. Best- value procurement methods for highway construction projects. Russill, Richard. 2010. A short guide to procurement risk. Farnham: Gower. http://search.ebscohost.com/login.aspx?direct=true&scope=site&db=nlebk&db=nlabk&AN=389063. Svensson, Roger. 2000. Success strategies and knowledge transfer in cross-border consulting operations. Boston: Kluwer Academic. Turner, Robert W. 2011. Supply management and procurement: from the basics to best-in-class. Fort Lauderdale, FL: J. Ross Pub. Read More