Procurement in Construction

[edit] Introduction

Construction projects are highly complex, with buyers and sellers often filling multiple roles as project stakeholders. Construction projects have a complex web of different stakeholders: buyers and sellers, owners, clients, contractors or developers - plus an array of specialised vendors like architects engineers and suppliers. Relationships between owners, general contractors, subcontractors and suppliers all exist on varying levels of contractual agreement in order to bring the entire endeavour to a successful completion.

Procurement in construction is conducted to better delegate the performance risk amongst these players who specialise in various fields. The procurement process might be repeated hundreds of times on big scale builds for one organisation alone! Procurement in construction carries with it a substantial financial burden - any missteps can have disastrous implications not just for the project owner, but throughout related hierarchies. To avoid this pitfall, even experienced professionals should ensure their contract management and scope knowledge is up-to-date and compliant with relevant legal standards.

[edit] Contractor’s Perspective

For contractors hoping to land the perfect job, bidding can be an extensive and costly exercise. When a successful bid is placed, contract clauses dictate that both buyers and sellers enter into agreement with one another.

Making sure scope, risk factors cost and time are managed properly during this competitive procurement process requires careful consideration of what products or services should be obtained internally versus externally by subcontractors or tradesmen.

As construction practices evolve there are more opportunities than ever before for contractors to show their mettle; by directing subcontractor activities effectively you can prove yourself capable of tackling even the most ambitious projects!

[edit] Owner’s Perspective

With every new construction project comes a number of factors that can heavily influence the cost, timeline and process. From specialised or hybrid contracting methods to fast-tracking projects for quicker outcomes - there are plenty of opportunities present to make decisions that will ultimately determine success.

Fast tracking is one technique to compress schedules which involves concurrently running design and construction stages- sometimes with design decisions made onsite.

See also: Procurement route.

[edit] Reference

Author(s) : Project Management Institute, Inc. (2016)

Name of publication : Construction Extension to the PMBOK® Guide

Place of publication : Newtown Square, Pennsylvania 19073-3299 USA

Name of publisher : Project Management Institute, Inc.

--Smitha. P. S

[edit] Related articles on Designing Buildings

• Chain of custody in design and construction.
• How to measure sustainable procurement.
• Procurement route.
• Sustainable procurement.
• Sustainable public procurement.
• Wood and sustainable procurement

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