INTRODUCTION TO CONSTRUCTION

PROCUREMENT PROCESS

Date : 20 September 2012

Dr. Md Asrul Nasid Masrom

Universiti Tun Hussein Onn Malaysia (UTHM)Department of Construction Management

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CONTENT

1.Construction Procurement

2.Framework of Construction Procurement Process

CONSTRUCTION PROCUREMENT

SIMPLE THEORY:

Procurement- the process of obtaining goods and services from another for some consideration

For this lecture, the term ‘Procurement’ is used in the context of construction & refers to the processes of acquiring construction project.

CONSTRUCTION PROCUREMENT

Procurement Triangle:

Cost Time

Quality

Cost

Quality

TimeCost

Quality

Time

CONSTRUCTION PROCUREMENT

Definition:

A strategy to satisfy client’s development and/or operational needs with respect to the provision of constructed facilities for a discrete life cycle.

-making the contract (type of contract, conditions, terms)-selecting the contractor-establishing the contract price-economic considerations (Labour, materials, plants, capital)

Type of procurement systemsSeparated systemCo-operative system Integrated procurement system

Management-oriented procurement system

Framework of Construction Procurement Process

Can be divided into 2 categories:

1. Processes during pre-construction stage (pre-contract)

2. Processes during construction stage (post contract)

Framework of Construction Procurement Process

Pre-construction:

4 phases as follows;

1. Initiation

2. Feasibility study

3. Design

4. Tendering

Framework of Construction Procurement Process

Construction Stage:

2 phases as follows;

1. Construction

2. Commissioning & hand over

Initiation

1.It is known as promotion.

2.It is the process of recognizing the need for a facility for owner occupation, as an investment or as a speculative development.

3. Come from owner (individual, government, private sector or developer.

4. Involve 2 key element: - Preparing project brief

- Preparing the feasibility study

Initiation

5. Both elements are crucial (the future of project in terms of its potential to succeed or otherwise are depends on it).

Initiation

2. Feasibility Study

1. Project Brief

Project Brief

Definition:

A statement of the needs of the client & how the proposed facility will be used.

It should define the client’s requirement (concept of project, time, cost & functionality)

Project Brief

1.Preparing it is a very tedious & time consuming activity. - Requires great expertise & knowledge of project by the personal who prepares them.

2.Poorly prepared it: - Can be subjected to a lot of interpretation & understanding which could make the whole exercise useless & certainly not the best interest of the client.

Elements of Project Brief

The requirement of the project (area of space, type & no. of units of quarters / classrooms, no. of hospital beds etc.)Target date of completionDesign featureAmount of money allocated for the projectEmployer attitudeEnvironmentOperational factorsSiteMarketDevelopment control

Attributes of A Good Project Brief

A good project brief is the one which adequate in terms of:

1.Clarity

- Its purpose should be clear, accurate & capable of detailed development so that due consideration can be given to each aspect of the construction project.

2.Priorities

- It should establish the project priorities & define those particular items / requirements that are necessities & those that are optional wishes.

Attributes of A Good Project Brief

3. Consistency

- It should be consistent throughout & devoid of conflicting statements & frustrate the determination of construction project & cost.

4. Completeness

- It should be completed enabling production of a building that satisfies the client needs.

Attributes of A Good Project Brief

5. Relevance

- It should contain the relevant information & decisions essential to the successful realization of the client’s development objective.

6. Benefits of development

- It should establish the benefits that the client hopes to obtain from the proposed project & the means of achieving them.

Attributes of A Good Project Brief

7. Realism

- It should be realistic & hence shaped to a greater / lesser extent by resources available & the quality to be achieved.

8. Flexibility

- It should be broad & lend itself to exploration of design problems, options & uncertainties.

The Brief Functions

Once it has been developed, agreed & formalized as a document, it can serve as various functions as :

1.A channel of communications

- Conveying instruction, decisions & information between a client, & his / her project team.

2.A key working document setting out the client’s requirement;

- In term of net use floor areas (specific details of the various space functions their relationships and details of the involvement of other parties .

The Brief Functions

3. A mean of stimulating communication & discussions among project participant by facilitating the setting of priorities, analysis, problem identification & information flow.

4. Provides a collective thinking through of the project.

The Brief Functions

5. A record of decisions, instruction, information, agreement, amendment, conflict & uncertainties.

- It can be used to ensure continuity & consistency during construction process / as a reference document.

6. A contractual document accompanying a legal agreement between the client & the design team.

The Brief Functions

7. A tool for evaluation of proposed construction project aims & resources against which design contents & framework can be appraised.

8. A basic for estimating resources required giving information of general comfort standards, cost, timescale for design / production of construction product & estimated useful life.

The feasibility study

Developing the design and preliminary cost estimate will lead to a feasibility report, advising the employer whether the project is feasible functionally, technically and financially.

- Sketch scheme-Cost estimate

The feasibility study

Sketches of house

The feasibility study

Cost estimate

Next Lecture: Next Lecture:

Other phases in pre-construction & construction.Other phases in pre-construction & construction.

Universiti Tun Hussein Onn Malaysia (UTHM)Department of Construction Management

Universiti Tun Hussein Onn Malaysia (UTHM)Department of Construction Management