CIOB: Better Procurement Gives You ‘More For Less’
Choosing the right procurement method is absolutely crucial for the delivery of a project on time, on budget and to a high quality said 87% of construction professionals taking part in the Chartered Institute of Building’s (CIOB) latest piece of research.
More than 500 respondents gave their views on the current state of procurement within UK construction. The report centres on the role of the client, current methods of procurement, the effects of the spending review, the prevalence of practices such as suicide bidding, and gives an industry insight into how construction procurement can be improved to give more for less.
Michael Brown CIOB Deputy Chief Executive said, “Getting clients more bang for their buck should always be at the forefront of the industry’s mind. But to make that work clients have to listen to the advice given by industry as well. There is clearly a need to look beyond any immediate gains and towards those longer term benefits that can be achieved from the right type of procurement. If the industry is squeezed to get the cheapest tender then you’ll end up getting what you pay for.
“These are testing times but at such moments it’s a good idea to step back from what’s gone before and find new ways to create greater efficiencies. If we knew what we know now about programmes like Building Schools for the Future (BSF) then we would have approached it differently. The challenge for the industry and clients is can they adapt quick enough to take advantage of the opportunities out there.”
The findings indicate that 77% of respondents believe clients are not sufficiently knowledgeable about procurement in the construction industry, which often leads to poor advice being taken and results in a project coming in over-budget, outside of time-frames, or to a poor standard.
93% of respondents have been involved in projects that overran in terms of cost. 57% of those who had been involved in over-budget projects believed that the chosen procurement method directly contributed to the cost overruns. Similarly, 94% have been involved on projects that overran in terms of time. Of those, 49% believe the chosen procurement method directly led to the time overruns.
The CIOB supports the government’s recent announcement to simplify the pre-qualification questionnaires (PQQs) via the voluntary PAS91 standard. However, much more can be done to promote the standard in the short-term, and simplify the PQQ process further in the long term. This is particularly prominent as 55% of respondents from this survey have indicated that simplified PQQs are vital to increasing competition levels for contracts. In addition, waste from the procurement process will be reduced through simpler pre-qualification. Respondents felt that standardisation should become a priority in public sector procurement.
Not only would this decrease overall cost, but it could facilitate a more integrated supply chain and result in a decrease in waste. The BSF programme was criticised heavily for some of its bespoke designs that ultimately compromised the projects and increased cost. If standardisation was to be set out at tender stage and communicated effectively to contractors, projects could benefit immensely from set costs and less risk throughout the procurement process.
This research comes hot on the heels of Paul Morrell’s (UK Government’s Chief Construction Adviser) Innovation and Growth Team report to government which makes recommendations on procurement and supply chain management.
A summary of the report can be found at: – www.ciob.org.uk/resources/research.
*Full copies of the raw data are available upon request.
ENDS
NOTES TO EDITORS
The Chartered Institute of Building (CIOB) represents for the public benefit the most diverse set of professionals in the construction industry.
Our Mission
To contribute to the creation of a modern, progressive, and responsible construction industry; able to meet the economic, environmental and social challenges faced in the 21st century.
Our 7 Guiding Principles
. Creating extraordinary people through professional learning and continuous personal development.
. Promoting the built environment as central to the quality of life for everyone everywhere.
. Achieving a sustainable future, worldwide.
. Advocating exemplary ethical practice and behaviour, integrity and transparency.
. Pursuing excellence in management practice, and technological innovation rooted in evidence based science.
. Being socially responsible and working responsibly.
. Enabling our members to find an emotional resonance with the Institute; their success is our success.
We have over 45,000 members around the world and are considered to be the international voice of the building professional, representing an unequalled body of knowledge concerning the management of the total building process.
Chartered Member status is recognised internationally as the mark of a true, skilled professional in the construction industry and CIOB members have a common commitment to achieving and maintaining the highest possible standards within the built environment.
Further information is available by contacting Saul Townsend CIOB Press and Communications
Manager on t: 01344 630 766 or e: stownsend@ciob.org.uk.
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Kind Regards
Saul Townsend MCIPR
Press & Communications Manager
The Chartered Institute of Building (CIOB)
t: + 44 (0) 1344 630 766 f: + 44 (0) 1344 630 770
e: stownsend@ciob.org.uk Twitter: CIOBsaul
w: www.ciob.org www.artofbuilding.org
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