Different Procurement Methods Edina Nagy Lajos Kiss Szabolcs Hornyák Overview 1. The Procurement 2. Traditional Procurement 3. Design and Build Procurement 4. Management Procurement systems 5. Comparing Traditional and Design and Build Procurement 6. References and further reading The Procurement Procurement describes the merging of activities undertaken by the client to obtain a building. Common types of procurement are: –Traditional Procurement –Design and Build Procurement –Management Procurement Systems Traditional Design Bid Build Traditional Design and Build Procurement Extreme A – Client-led design and build Extreme Z – Contractor-led design and build Extreme A Client-led Design and Build Extreme Z Contractor-led Design and Build Management Procurement Systems Management procurement systems are often used to speed up the procurement processes. Common types: • Management Contracting • Construction Management Management Contracting As an alternative to the traditional approach, the client may decide to appoint a management contractor to engage and manage a number of work package subcontractors. Management contracting enables the client to create a competitive situation between management contractors at the appointment stage of the project. Management Contracting Construction Management In this situation the construction management consultant or construction manager joins the design team early in the project. The construction manager’s services are based on a negotiated fee with the client simply to supervise and plan the work to be undertaken by the work package contractors. Construction Management Advantages and Disadvantages of these methods These are suitable for: – fast track projects – complex buildings – a developing brief Disadvantages: – total cost of the project is not usually known until the project – damages for delay are difficult to pin on one subcontractor – the client takes all the risk, particularly in the construction management Comparing Traditional and Design & Build Procurement Similarities between the two methods: – Suitable for all clients, including inexperienced clients – Price certainty is secured early in the project – Firm contractual date for completion Differencies between the two methods Traditional Procurement All design risk is ultimately carried by the client Design and build Procurement The major risks lie with the contractor Capable of obtaining the best The contractor assumes contract price for the full scope greater financial risk and this is of the works often reflected in the price It is not suitable for fast track projects Suitable for fast track projects Client retains control over the It is more problematic to design team and quality can be control design and quality assured References and further reading 1. What does it mean procurement? – pp. 26 2. What are the advantages and disadvantages of the traditional procurement? – pp. 29-30 3. What it means to design and build procurement? – pp. 31 4. What are the disadvantages of the management procurement systems? – pp. 38 5. What are the similarities and differences between the traditional and the design and build? – pp. 29-30/35 6. What is similar to the traditional procurement and construction management? – pp. 35-36 1Construction Planning, Programming and Control/Brian Cooke and Peter Williams. – 3rd. ed.2008 Thank you for your attention!