Sunny Yacht Club v Ah Seng Pte Ltd
a) i) Traditional
A traditional procurement route is the most common form of procurement for both small and medium sized projects. Since it is a widely used procurement route in the industry, implementing the traditional procurement route have several benefits such as: Procedures that is familiar and well known in the industry. Reasonable public accountability due to the competitive selection. Competitive fairness and low costs of tender preparation.
Variations are comparatively easy to organise and carried out. A traditional procurement route however is susceptible to potential risks which include: Low quality since the design is made to accommodate the fast project completion date. Prospective ineffectiveness of the construction and design due to lack of input by contractor. Risk of claims when design information and instructions from the consultants are conveyed late to the contractor. Adversarial relationships when abuse occurs.
Potential delays in the overall completion time and late start of the project.
ii) Design and Build
The Design and build procurement route involves the client appointing a single contractor to design and construct the project. This allows for several benefits such as: Reduces client’s time and resources due to single point accountability. Faster overall project duration as compared to that in traditional. Improved constructability due to contractor’s input.
Price certainty of the project.
Possible addition of fitness for purpose as an extension in the contractor’s design liability. Potential risks in the design and build procurement route includes: Poor design and quality of project since design have to be approved in the early stages. Increase in variations due to lack of adequate and comprehensive brief by Client Limitations in the design liability in the project
Cost risks as it is expensive to implement any changes.
Management contracting is a 'fast track' route. With this route, a management contractor is engaged by the client to manage the whole of the building process. Through the management procurement route the project benefits include: Competitive tendering as it allows for individual packages to be let competitively at prices that are current. Improved coordination and collaboration between designers and contractors which breaks down adversarial relationships. Facilitate clarity in the roles, risks and responsibilities for all parties in the project. Provides opportunities for a better and more improved constructability. There is potential time savings in the duration of the project. More flexibility for changes in the design as there is an easier accommodation for late changes. The main risks to the management procurement route however are: Incomplete design if Client does not provide adequate and comprehensive brief. No price certainty until the final works package has been let. Potential claims to be faced by clients.
Potential delays in the project programme due to lack of coordination and incompetent team. Loss of control by client as design quality is influenced directly by the designers and contractors.
b) The two variants to the (i) Traditional procurement, (ii) Design and Build and (iii) Management routes are: i) Sequential and Acceleration method
ii) Turnkey and Develop and construct (novation ab initio)
iii) Management contract and Construction management
In the Sequential method design risks are mitigated by having a clear accountability and better design and construction control by the client. Since the pre-contract stage of this system is longer, more time is available for the client and the project team to scrutinize and review the design before construction. Through the Acceleration method, there are two strategies that can be implemented; the Accelerated traditional...
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