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Overview of Procurement Process

Overview of Procurement Process

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Article
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In the United Kingdom, partnering was proposed by Sir Michael Latham as a means of achieving 30% cost savings in a suitable organizational climate. How this is achieved within the construction industry involves not only a mutuality of purpose between project personnel, but appropriately applied methods of process. This paper addresses the issues su...

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Context 1
... five stages of the process, mentioned above, will be described as they were developed for GBC's Millennium Bridge. A process map of this methodology showing each key stage is shown in Fig. 2. A general overview of each key stage will be explained, followed by details of the mechanisms ...

Citations

... The construction sector is mostly characterised by one-off projects involving myriad parties with different or even conflicting interests, creating difficulties in developing trust, understanding and long-term relationships (Brown et al. 2001, Beach et al. 2005. According to Brown et al. (2001) and Naoum (2003), this characteristic, along with intense rivalry in price-based bidding and contractually-enforced relationships, accounts for the deficiency of traditional construction procurement approaches, where such crucial elements as value, quality, timeliness and innovation are overlooked in the tendering process and where (sub)contractors seek opportunities to compensate for their squeezed margin, resulting in adversarial procurement relations. ...
... The construction sector is mostly characterised by one-off projects involving myriad parties with different or even conflicting interests, creating difficulties in developing trust, understanding and long-term relationships (Brown et al. 2001, Beach et al. 2005. According to Brown et al. (2001) and Naoum (2003), this characteristic, along with intense rivalry in price-based bidding and contractually-enforced relationships, accounts for the deficiency of traditional construction procurement approaches, where such crucial elements as value, quality, timeliness and innovation are overlooked in the tendering process and where (sub)contractors seek opportunities to compensate for their squeezed margin, resulting in adversarial procurement relations. Empirical insights into other drawbacks of traditional construction procurement can be found in the survey-based research of Black et al. (2000). ...
... This can cause many project management problems, e.g. difficulty in building trust, communication and long-term relationships amongst project stakeholders (Brown et al. 2001, Beach et al. 2005. Traditional procurement systems leverage price-based bidding and contractually-enforced relationships where stakeholders only focus on their own benefits at the expense of project efficiency in terms of collaboration for problem-solving and assurance of total cost reduction (Black et al. 2000, Naoum 2003). ...
Article
The last decades have seen a growing interest in construction management amongst scholars, particularly, in how to apply supply chain management (SCM) strategies to improve logistics efficiency and project performance. Nevertheless, there is a lack of systematic literature reviews (SLRs) which integrate multiple quantitative methods to synthesise the literature on construction logistics and supply chain management (CLSCM) and analyse their trends during the last two decades. In this work, we concurrently deploy the rigorous six-step SLR protocol together with co-citation analysis, factor analysis, multidimensional scaling-based fuzzy k-means clustering, and keyword extraction and co-occurrence analysis to ascertain and examine clusters of CLSCM application. The results show that there are six established research clusters in CLSCM, namely, logistics and SCM for prefabricated construction, construction procurement, construction supply chain integration, green construction SCM, reverse logistics in construction and onsite construction logistics. Amongst these clusters, construction supply chain integration plays the most integral role. Informed by this ascertained knowledge structure, we explore the research trends during the period reviewed, propose a conceptual framework for CLSCM and suggest research avenues.
... The construction sector is mostly characterised by one-off projects involving myriad parties with different or even conflicting interests, creating difficulties in developing trust, understanding and long-term relationships (Brown et al. 2001, Beach et al. 2005. According to Brown et al. (2001) and Naoum (2003), this characteristic, along with intense rivalry in price-based bidding and contractually-enforced relationships, accounts for the deficiency of traditional construction procurement approaches, where such crucial elements as value, quality, timeliness and innovation are overlooked in the tendering process and where (sub)contractors seek opportunities to compensate for their squeezed margin, resulting in adversarial procurement relations. ...
... The construction sector is mostly characterised by one-off projects involving myriad parties with different or even conflicting interests, creating difficulties in developing trust, understanding and long-term relationships (Brown et al. 2001, Beach et al. 2005. According to Brown et al. (2001) and Naoum (2003), this characteristic, along with intense rivalry in price-based bidding and contractually-enforced relationships, accounts for the deficiency of traditional construction procurement approaches, where such crucial elements as value, quality, timeliness and innovation are overlooked in the tendering process and where (sub)contractors seek opportunities to compensate for their squeezed margin, resulting in adversarial procurement relations. Empirical insights into other drawbacks of traditional construction procurement can be found in the survey-based research of Black et al. (2000). ...
... This can cause many project management problems, e.g. difficulty in building trust, communication and long-term relationships amongst project stakeholders (Brown et al. 2001, Beach et al. 2005. Traditional procurement systems leverage price-based bidding and contractually-enforced relationships where stakeholders only focus on their own benefits at the expense of project efficiency in terms of collaboration for problem-solving and assurance of total cost reduction (Black et al. 2000, Naoum 2003). ...
Article
Despite the long-recognised importance of data-driven operations and supply chain management (OSCM) scholarship and practice, and the impressive development of big data analytics (BDA), research finds that firms struggle with BDA adoption, which suggests the existence of gaps in the literature. Therefore, we conduct this systematic literature review of journal articles on data-driven OSCM from 2000 to early 2020 to ascertain established research clusters and literature lacunae. Using co-citation analysis software and double-checking the results with factor analysis and multidimensional-scaling-based k-means clustering, we find six clusters of studies on data-driven OSCM, whose primary topics are identified by keyword co-occurrence analysis. Five of these clusters relate directly to manufacturing, which, in line with the existing literature, indicates the crucial role of production in OSCM. We highlight the evolution of these research clusters and propose how the literature on data-driven OSCM can support BDA in OSCM. We synthesise what has been studied in the literature as points of reference for practitioners and researchers and identify what necessitates further exploration. In addition to the insights contributed to the literature, our study is amongst the first efforts to deploy multiple clustering techniques to undertake a rigorous data-driven systematic literature review (SLR) of data-driven OSCM.
... Construction industry projects are often characterized by a highly fragmented supply chain and a less fragmented demand side that is organized and linked via supply chain relationships (Oyegoke et al., 2009). The supply chain management concept aims to integrate the interests of all stakeholders (suppliers and customers) towards the common goal of efficiently delivering best value to the client (Brown et al., 2001;Cox and Townsend, 1998;Oyegoke et al., 2009). According to Pryke (2006), the construction project can be viewed as a network of relationships between firms that make up the project supply chain. ...
... Construction industry projects are often characterized by a highly fragmented supply chain and a less fragmented demand side that is organized and linked via supply chain relationships (Oyegoke et al., 2009). The supply chain management concept aims to integrate the interests of all stakeholders (suppliers and customers) towards the common goal of efficiently delivering best value to the client (Brown et al., 2001;Cox and Townsend, 1998;Oyegoke et al., 2009). According to Pryke (2006), the construction project can be viewed as a network of relationships between firms that make up the project supply chain. ...
... The partnership mentality has been a substantial drive-in business for the past decade. A worldwide effort to enhance the construction industry [16]: a partnership is described as a long-term commitment between two or more people or organizations to achieve specified business objectives by maximizing the effectiveness of each participant's resources. Regardless of the structure at the border, this necessitates a shift in traditional cultural ties. ...
... The analysis of the results revealed that all the three parties involved in this survey agreed that the performance of contractor and quality of work is the most significant performance measures with overall percentages of 87.5 and 86.3, respectively. These results are consistent with other research works like Egan (1998), Brown et al. (2001), Construction Industry Task Force (1998), Arditi andGunaydin (1998), andConstruction Industry Development Board Malaysia (CIDB, 2000). ...
Article
Full-text available
Construction industry has complexity in its nature because it contains a large number of participants as clients, consultants, contractors, stakeholders, shareholders, regulators and others. The topic of performance measurement becomes very crucial to construction projects to determine their success. Previous studies show the development of specific indicators for performance is among the most significant mechanisms for the measurement of performance. The main objective of this study is to examine and evaluate the systems for performance measurement adopted in the Iraqi construction projects during the implementation phase. This aim was achieved through structured interviews and a survey that was carried out among the different parties involved in the construction process. A total of 97 participants contributed to this survey representing public and private clients, consultants, and contractors. The analysis of the survey revealed that the most significant factors relating to the types of measurement systems in use are satisfaction of the client, the profitability of the project, viability and feasibility of the project, satisfaction of the project’s users, and quality of the project. The study revealed that all of the 20 indicators suggested in the survey might be utilized to shape the performance framework measurement of Iraqi construction projects at the implementation phase.
... Dulaimi et al. (2010) documented various factors contributing to the failure of public-private partnership projects in the UAE using three case studies; the factors were the lack of appropriate skills in the consortium, high project values, high risk, high participation costs, lack of credibility and contacts, poor communication between private partners, demands on management time, and long procurement and negotiation processes. Brown et al. (2001) considered two problems leading to partnering failure. The first matter was partners maintaining their adversarial stance. ...
Article
Construction mega-projects are typically associated with cost overruns and time delays due to conflicts of interest between diverse stakeholders. This research investigates the influence of the partnering approach and the adoption of Design and Build (D&B), also known as Design-Build (DB), contracts on the behavior of stakeholders on mega-projects in Qatar. Through a case study, the significant factors that influence stakeholder management are appraised, such as cooperation, developing trust and lack of communication. The research concluded that mutual trust, transparency, leadership, well-defined scope of work, a clear definition of responsibilities, collaboration, and training are the main success factors of partnering projects. The research also concluded that the State of Qatar is a leader in the implementation of partnering approaches and the adoption of D&B contracts, with a proven record of successful delivery using this procurement method. '''Trust' and '''collaboration' among stakeholders have been found to be the critical success factors of partnering projects in Qatar.
... Chan et al. 2004;Chan et al. 2003a;Miller et al., 2000;Bayliss et al., 2004) -related studies in Hong Kong -indicated that the five frequent CSFs were (1) conflict resolution; (2) establishment; (3) obvious definition of responsibilities; (4) regular monitoring of partnering processes; and (5) readiness to share resources among project stakeholders. Brown et al. (2001) introduced additional factors such as (1) training and preparation; (2) equity; (3) defining of stakeholder's expectations and limitations; (4) development of mutual goals; (5); and (6) leadership. While Hawke (1994) examined factors (reasons) leading to partnering failure in Australia. ...
... The second matter was partners preserving their adversarial position. To achieve optimal performance, trust, and "long-term" relations between the stakeholders are essential, (Brown et al., 2001;Mashali et al., 2019;Wong et al., 2008). Wolstenholme (2009) found that "distrust" is chronic and longstanding in the construction projects and that trust is hard to set-up between stakeholders, mostly because of adversarial relations and disputes between stakeholders . ...
Article
Full-text available
Construction mega-projects are typically associated with cost overruns and time delays due to conflicts of interest between diverse stakeholders. This research investigates the influence of the partnering approach and the adoption of Design and Build (D-B) contractual agreement on the behaviour of stakeholders on mega-projects. Through a case study, the significant factors that influence stakeholder management are appraised, such as cooperation, developing trust, and a dearth of communication. The research concluded that mutual trust, transparency, leadership, the well-defined scope of work, a clear definition of responsibilities, collaboration, and training are the main success factors of partnering projects. The research also emphasised that Building Information Modelling (BIM) plays a vital role to secure the mentioned key successful factors for partnering. Furthermore, BIM facilitates achieving project objectives with the adoption of D-B contracts. This research contributes to the developing body of knowledge addressing the application of partnering in construction. The outcomes of this research will be beneficial for clients, contractors, project managers, and contract managers when taking into account future execution plans for D-B projects. Forthcoming studies can develop a framework to combine various stakeholders to obtain optimum satisfaction.
... Chan et al. 2004;Chan et al. 2003a;Miller et al., 2000;Bayliss et al., 2004) -related studies in Hong Kong -indicated that the five frequent CSFs were (1) conflict resolution; (2) establishment; (3) obvious definition of responsibilities; (4) regular monitoring of partnering processes; and (5) readiness to share resources among project stakeholders. Brown et al. (2001) introduced additional factors such as (1) training and preparation; (2) equity; (3) defining of stakeholder's expectations and limitations; (4) development of mutual goals; (5); and (6) leadership. While Hawke (1994) examined factors (reasons) leading to partnering failure in Australia. ...
... The second matter was partners preserving their adversarial position. To achieve optimal performance, trust, and "long-term" relations between the stakeholders are essential, (Brown et al., 2001;Mashali et al., 2019;Wong et al., 2008). Wolstenholme (2009) found that "distrust" is chronic and longstanding in the construction projects and that trust is hard to set-up between stakeholders, mostly because of adversarial relations and disputes between stakeholders . ...
... There is also a big difference between the value and the price, though both are defined through the perceptions of the tenderer and potential supplier or vendor (Brown, Ashleigh, Riley, & Shaw, 2001). The most important distinction between price and value is the fact that price is arbitrary, and value is fundamental. ...
Thesis
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Large scale software-centric information system projects on public sector are often based on public tenders, in which the established request for quotation (RFQ) process is utilized in various forms. The way the information systems in these cases are procured is typically a long and energy consuming process. In this process, after the initial realization that there is a need for which the system is required for, the procuring organization, i.e., the future customer or an organization acting in behalf of the customer, first tries its best to determine, detail and document the need and then, based on received proposals, tries to evaluate the best candidate to fulfill the need with an proposed solution. In the past, these RFQ-based procuring processes aimed at and mostly also resulted in waterfall-type development processes, where again a considerable time was spent in specifying, implementing, testing and tuning the constructed information system before it finally was ready and accepted to be deployed for the operative use. The approach utilizing well-documented needs, the tendering phase, and waterfallish development process after the awarding phase has numerous shortcomings. One of the most important problems is the strong dependency on the upfront designs and the implicit assumption that the need and the solutions to that need can be communicated effectively with tendering documents and solution descriptions. Another major problem is the implicit assumption that the original needs do not significantly change during the process. Many development projects that are run in this way fail, either by exceeding their budgets, by experiencing considerable delays or just by being unable to provide a satisfactory solution to the actual need. As we have entered the era of agility during the last 10-15 years, backed up by the agile values and principles, the incremental, iterative and customerinvolving approaches have found their way into the RFQ-based tenders. This has certainly happened for a reason, the most likely reason being the hope the agility is the silver bullet that can cure the problematic RFQ process. The introduction of agility has certainly potential to solve some of the problems encountered in the RFQ processes, but at the same time, new challenges surface. Furthermore, recently many organizations, also on the public sector, have reassessed their position as both the information system user and the system’s maintainer and have realized that it might be a good idea to let the software or IT companies to provide the needed systems as a service, thereby also transferring the risks and costs of running the system to external parties, and potentially to a party who has developed the system. This software-as-a-service (SaaS) paradigm opens up a whole new set of possibilities to develop information systems, get feedback and enable co-operation between the system owners or users and the system developers on improving the system. This thesis studied the challenges encountered in mission critical information system projects in industrial setting, based on public tendering processes. The reasons for the challenges and why the challenges are difficult to tackle were analyzed from various points of view by the publications. The format of the study is that of the multiple-case study investigating and analyzing the causal links in the real-life projects. As a result, it seems that the traditional RFQ-based process, even when amended with some requirements calling for agile ways of working, does not provide us appropriate means to deliver high quality mission critical systems in an effective way and alternatives are needed. Based on the experiences gained from the system provision domain, it is evident that the SaaS model is able to save us from many of the short-comings of the RFQ process, by enabling agility and helping us, at least partly, to tackle the encountered challenges in the traditional RFQ process. Providing something as a service is, however, far different from traditional information system development and deployment and thus new, user and customer-facing skills are required from the organization providing the service. In addition, several other improvements, like changes in the way the RFQ process is used, or even to the law governing the public tenders, would also be required to allow us to achieve the best possible outcomes and best achievable return-of-investment (ROI) for the information system projects in the future.