Case Study procuring construction. Interserve Ltd. (Contractor) are 41 weeks in on a school extension (The Project), which is to be handed over at the end of week 60. The project is on an existing occupied secondary school site for Merthyr Co

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AR50360 Assignment

Name: Mizanur Rahman

1. The Project

Interserve Ltd. (‘Contractor’) are 41 weeks in on a school extension (‘The Project’), which is to be handed over at the end of week 60.  The project is on an existing occupied secondary school site for Merthyr Council (‘Client’) in Wales.

The procurement approach is a novated Design & Build (D&B), as Capita the design team partner (‘DTP’) were the client’s representative, who conducted the feasibility studies/site tests, as well as school design up to RIBA stage C along with conducting the tenders.  It was decided to involve the successful contractor from RIBA stage D onwards in order to develop the sketch plans into detailed design and cost proposals.  This would allow the contractor to bring direct market knowledge along with buildability advice to the table

The contractor was awarded the project after a two-stage tender process, with the 1st stage based on outline specification and preliminary cost plan details for pre-construction, mobilisation, components, direct and sub-contract fees along with a quality element.  The 2nd stage was solely with the contractor to achieve a high degree of cost certainty through market testing of the works packages to provide a lump sum figure, which was to be incorporated into an NEC 2005 Option A Contract with Activity Schedule.  During the second stage full design details were developed, from which the contractor prepared bills of quantities and subsequently various priced sub-contractor packages.  This was then submitted to the client along with various cost savings to provide a market tested package totalling £3.8m, saving £200k against the budgeted target cost of £4m.

The contractor is capable of ‘Pure’ D&B but as the client has already engaged with their own DTP, the initial configuration was more representative to ‘Fragmented’ D&B, as the contractor was not at that point certain who will become the supply chain. The diagrams below illustrate the relationships pre & post RIBA stage D:

DTP PRE-NOVATION

DTP POST NOVATION

2. The Appointment

The contractor is appointed on an OJEU procured government framework, which allows any public body to call-off from the framework without repeating the lengthy process involved, this process also ensures the public client maintains compliancy with The Public Contracts Regulations 2006.  

For appointment to the framework the contractor went through a 2 stage process including a pre-qualification stage and a tender stage.  40 other contractors were involved in the 2nd stage of which a maximum of 9 (3 per region of mainland UK) could be appointed.  

The evaluation areas included:

  1. Design capability (inc. any consultants offered) & sector experience

  1. Demonstration of sector experience with references and case studies
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  1. Project partnering, supply chain management, continuous improvement, achievements, value engineering, change management, capability, development process and local training/employment

  1. Efficiency and reliability

  1. Sustainability credentials

  1. Price, agreed maximum percentages on for fees and OHP, based on project types and values

To satisfy the above and become successful, various departments within the contractor’s organisation had a role to play.

Marketing

The contractors firm firstly would have a corporate strategy identifying the market segments from which they will aim to operate effectively.  From this the business strategy will dictate the contractor’s stance/priority when ...

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