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- Herausgeber: John Wiley & Sons
- Kategorie: Wissenschaft und neue Technologien
- Sprache: Englisch
The guide that explores how procurement and contracts can create an integrated team while improving value, economy, quality and client satisfaction
Collaborative Construction Procurement and Improved Value provides an important guide for project managers, lawyers, designers, constructors and operators, showing step by step how proven collaborative models and processes can move from the margins to the mainstream. It covers all stages of the project lifecycle and offers new ways to embed learning from one project to the next.
Collaborative Construction Procurement and Improved Value explores how strategic thinking, intelligent team selection, contract integration and the use of digital technology can enhance the value of construction projects and programmes of work. With 50 UK case studies, plus chapters from specialists in 6 other jurisdictions, it describes in detail the legal and procedural route maps for successful collaborative teams.
Collaborative Construction Procurement and Improved Value:
- Examines the ways to create an effective contract that will spell success throughout the procurement process
- Contains helpful case studies from real-world projects and programmes
- Explores the benefits of the collaborative construction process and how to overcome common obstacles
- Bridges the gaps between contract law, collaborative working and project management
- Includes the first analysis of the NEC4 Alliance Contract, the FAC-1 Framework Alliance Contract and the TAC-1 Term Alliance Contract
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Table of Contents
Cover
Reviews
Preface
Acknowledgements
About the Authors
1 What Is Collaborative Construction Procurement?
1.1 Overview
1.2 What Is Collaborative Construction Procurement?
1.3 Why Is Collaborative Procurement Important?
1.4 What Research Has Examined Collaborative Construction Procurement?
1.5 What Case Studies Support Collaborative Procurement?
1.6 How Is Collaborative Procurement Connected to Digital Technology?
1.7 How Is Collaborative Procurement Connected to Contracts?
1.8 Who Was Sir Michael Latham?
1.9 How Can Collaborative Procurement Reflect ISO 44001?
1.10 What Should Collaborative Procurement Provide?
2 What Are the Foundations for Collaborative Construction Procurement?
2.1 Overview
2.2 What Is Different About Collaborative Construction Procurement?
2.3 How Are Construction Contracts Formed?
2.4 What Is Different About a Collaborative Construction Contract?
2.5 What Is an Alliance?
2.6 How Does BIM Affect Collaborative Procurement?
2.7 What Is Early Contractor Involvement?
2.8 What Are Two Stage Open Book, Cost Led Procurement and Integrated Project Insurance?
2.9 What Is Supply Chain Collaboration?
2.10 What Are the Supply Chain Collaboration Activities?
3 How Does a Project Alliance Operate?
3.1 Overview
3.2 What Is a Collaborative Project Team?
3.3 How Can a Collaborative Team Form a Project Alliance?
3.4 How Does a Project Alliance Operate?
3.5 How Can a Project Alliance Use Early Contractor Involvement?
3.6 How Can a Project Alliance Use Supply Chain Collaboration?
3.7 How Can a Project Alliance Measure and Reward Performance?
3.8 How Can a Project Alliance Improve Value and Outcomes?
3.9 How Can a Project Alliance Deal with Problems?
3.10 Project Alliance Case Studies
4 How Does a Framework Alliance Operate?
4.1 Overview
4.2 What Is a Framework?
4.3 How Does a Framework Contract Operate?
4.4 What Is a Framework Alliance?
4.5 How Does a Framework Alliance Award Work?
4.6 How Can a Framework Alliance Use Supply Chain Collaboration?
4.7 How Can a Framework Alliance Measure and Reward Performance?
4.8 How Can a Framework Alliance Improve Value?
4.9 How Can a Framework Alliance Deal with Problems?
4.10 Framework Alliance Case Studies
5 How Does a Term Alliance Operate?
5.1 Overview
5.2 How Does a Term Contract Operate?
5.3 What Are the Term Contract Forms?
5.4 What Is a Term Alliance?
5.5 How Does a Term Alliance Award Work?
5.6 How Can a Term Alliance Use Supply Chain Collaboration?
5.7 How Can a Term Alliance Improve Asset Management?
5.8 How Can a Term Alliance Improve Value?
5.9 How Can a Term Alliance Deal with Problems?
5.10 Term Alliance Case Studies
6 How Are Collaborative Team Members Selected?
6.1 Overview
6.2 What Are the Problems with Single Stage Selection?
6.3 How Can Early Contractor Selection Enable Collaborative Procurement?
6.4 How Can Early Contractor Selection Create More Accurate Prices?
6.5 How Are Collaborative Team Members Selected?
6.6 How Do Framework Selection Procedures Operate?
6.7 How Can Evaluation Criteria Balance Cost and Quality?
6.8 Can Early Contractor Selection Comply with Public Procurement?
6.9 Can Collaborative Working Occur During Selection?
6.10 Collaborative Selection Case Studies
7 Does Collaborative Procurement Need a Contract?
7.1 Overview
7.2 What Is the Impact of a Non‐binding Agreement?
7.3 What Is the Impact of a Letter of Intent?
7.4 What Is the Impact of Implied Good Faith?
7.5 What Is the Impact of Express Good Faith?
7.6 What Is a Virtual Organisation?
7.7 What Is the Impact of a No Blame Clause?
7.8 What Is the Impact of a Collaborative Contract?
7.9 What Is the Impact of a Multi‐Party Contract?
7.10 Collaborative Construction Management Case Studies
8 What Types of Contract Support Collaborative Procurement?
8.1 Overview
8.2 What Is a Relational Contract?
8.3 What Is a Conditional Contract?
8.4 What Is Enterprise Planning?
8.5 What Is an Enterprise Contract?
8.6 What Are the Enterprise Features of a Project Alliance Contract?
8.7 What Are the Enterprise Features of a Framework Alliance Contract?
8.8 How Can Collaborative Procurement Support a Joint Venture or Client Consortium?
8.9 How Can Collaborative Procurement Support a Public Private Partnership?
8.10 Collaborative Joint Venture and Consortium Case Studies
9 What Standard Form Contracts Support Collaborative Procurement?
9.1 Overview
9.2 What Is the Role of Standard Form Contracts?
9.3 How Can Standard Form Contracts Support Collaborative Procurement?
9.4 How Does FIDIC 2017 Support Collaborative Procurement?
9.5 How Does ICC 2014 Support Collaborative Procurement?
9.6 How Does JCT 2016 Support Collaborative Procurement?
9.7 How Does NEC4 Support Collaborative Procurement?
9.8 How Does PPC2000 Support Collaborative Procurement?
9.9 Which Standard Form Contracts Support a Project Alliance?
9.10 How Are Collaborative Project Contracts Used in Practice?
10 How Does the FAC‐1 Framework Alliance Contract Operate?
10.1 Overview
10.2 What Are the Key Features of FAC‐1?
10.3 How Does FAC‐1 Award Work?
10.4 How Does FAC‐1 Support Supply Chain Collaboration?
10.5 How Does FAC‐1 Measure and Reward Performance?
10.6 How Does FAC‐1 Support Collaborative Risk Management?
10.7 How Can FAC‐1 Reflect Differing Requirements?
10.8 How Does FAC‐1 Reflect UK Government and Industry Recommendations?
10.9 How Is FAC‐1 Being Used in Practice?
10.10 FAC‐1 Framework Alliance Case Studies
11 How Does the TAC‐1 Term Alliance Contract Operate?
11.1 Overview
11.2 How Was TAC‐1 Developed?
11.3 What Are the Key Features of TAC‐1?
11.4 How Does TAC‐1 Award Work?
11.5 How Does TAC‐1 Support Supply Chain Collaboration?
11.6 How Does TAC‐1 Measure and Reward Performance?
11.7 How Does TAC‐1 Support Collaborative Risk Management?
11.8 How Can TAC‐1 Reflect Differing Requirements?
11.9 How Does TAC‐1 Differ from TPC2005?
11.10 How Are TPC2005 and TAC‐1 Used in Practice?
12 How Is a Collaborative Culture Created?
12.1 Overview
12.2 What Is the Role of People in a Collaborative Culture?
12.3 Who Leads a Collaborative Culture?
12.4 Who Manages a Collaborative Culture?
12.5 How Can a Collaborative Culture Include all Stakeholders?
12.6 How Can a Collaborative Culture Improve Communication?
12.7 What Is the Role of a Core Group or Alliance Board?
12.8 What Is the Value of Training and Workshops?
12.9 What Is the Role of an Independent Adviser?
12.10 Collaborative Culture Case Studies
13 How Can BIM Support Collaborative Procurement?
13.1 Overview
13.2 What Is the Impact of Digital Technology?
13.3 What Is the Impact of BIM?
13.4 How Can BIM Enable Collaborative Procurement?
13.5 How Can BIM Support Early Contractor Involvement?
13.6 How Can BIM Support Whole Life Asset Management?
13.7 How Do Collaborative Teams Use BIM in Practice?
13.8 What Is the Impact of Smart Contracts?
13.9 What Are the Limits of Smart Contracts?
13.10 BIM Research Results
14 How Does BIM Support Collaborative Contracts?
14.1 Overview
14.2 How Does BIM Affect a Duty of Care?
14.3 How Does BIM Affect Agreed Deadlines and Interfaces?
14.4 How Does BIM Affect Intellectual Property Rights?
14.5 How Does BIM Affect Reliance on Data?
14.6 Who Manages BIM Data?
14.7 How Is BIM Treated in Construction Contracts?
14.8 How Does BIM Affect Alliances?
14.9 How Can BIM Deal with Problems?
14.10 BIM Alliance Case Studies
15 How Can Collaborative Procurement Improve Economic and Social Value?
15.1 Overview
15.2 How Can Collaborative Procurement Benefit All Team Members?
15.3 How Can Collaborative Procurement Create Cost Certainty and Cost Savings?
15.4 How Can Collaborative Procurement Improve Quality?
15.5 How Can Collaborative Procurement Improve Supply Chain Relationships?
15.6 How Can Collaborative Procurement Create Local and Regional Opportunities?
15.7 How Can Collaborative Procurement Support Employment and Training?
15.8 How Can Collaborative Procurement Support Improved Safety?
15.9 How Can Collaborative Procurement Support Environmental Benefits?
15.10 Benefits of Two Stage Open Book and Supply Chain Collaboration
16 How Is Collaborative Procurement Costed and Incentivised?
16.1 Overview
16.2 What Is the Impact of Open Book Costing?
16.3 How Can Collaborative Procurement Achieve a Fixed Price?
16.4 How Do Target Costs and Cost Reimbursement Operate?
16.5 How Can Early Contractor Involvement Control Costs?
16.6 How Is a Framework Alliance Costed?
16.7 How Is a Term Alliance Costed?
16.8 How Do Shared Pain/Gain Incentives Operate?
16.9 What Other Incentives Support Collaborative Procurement?
16.10 Collaborative Costing Case Studies
17 How Does Collaborative Procurement Manage Time and Change?
17.1 Overview
17.2 Why Is Collaborative Time Management Important?
17.3 Is a Programme the Same as a Timetable?
17.4 How Are Programmes and Timetables Treated in Construction Contracts?
17.5 What Timetables Support a Collaborative Team?
17.6 What Timetables Integrate Collaborative Design?
17.7 What Timetables Support a Framework Alliance or Term Alliance?
17.8 How Can an Integrated Timetable Improve Value?
17.9 How Can a Collaborative Team Manage Change?
17.10 Collaborative Time Management Case Studies
18 How Can Collaborative Procurement Improve Risk Management?
18.1 Overview
18.2 How Are Risks Priced?
18.3 How Can Risks Be Managed Jointly?
18.4 How Do Construction Contracts Treat Risk Management?
18.5 How Can Collaborative Procurement Improve Risk Management?
18.6 How Can a Collaborative Team Manage Ground Risk?
18.7 How Can Risk Be Managed Through No Blame Clauses?
18.8 How Can Risk Be Managed Through New Insurance?
18.9 What Is the Role of Project Bank Accounts?
18.10 Collaborative Risk Management Case Studies
19 How Can Collaborative Procurement Reduce Disputes?
19.1 Overview
19.2 Are Construction Disputes a Bad Thing?
19.3 What Are the Causes of Construction Disputes?
19.4 How Can Early Contractor Involvement Reduce Disputes?
19.5 How Can a Collaborative Team Avoid Disputes?
19.6 How Can Early Warning Avoid Disputes?
19.7 How Can a Core Group or Alliance Board Resolve a Dispute?
19.8 How Can an Independent Adviser Resolve a Dispute?
19.9 Are There Other Collaborative Ways to Resolve a Dispute?
19.10 Collaborative Dispute Resolution Case Studies
20 How Does Collaborative Procurement Operate in Australia?
20.1 What Is the Approach to Alliances in Australia?
20.2 What Is the Approach to BIM in Australia?
20.3 What Is the Approach to Construction Contracts in Australia?
20.4 What Is the Potential for a Framework Alliance in Australia?
20.5 What Are the Legal Issues Affecting an Alliance in Australia?
21 How Does Collaborative Procurement Operate in Brazil?
21.1 What Is the Approach to Alliances in Brazil?
21.2 What Is the Approach to BIM in Brazil?
21.3 What Is the Approach to Construction Contracts in Brazil?
21.4 What Is the Potential for a Framework Alliance in Brazil?
21.5 What Are the Legal Issues Affecting an Alliance in Brazil?
22 How Does Collaborative Procurement Operate in Bulgaria?
22.1 What Is the Approach to Alliances in Bulgaria?
22.2 What Is the Approach to BIM in Bulgaria?
22.3 What Is the Approach to Construction Contracts in Bulgaria?
22.4 What Is the Potential for a Framework Alliance in Bulgaria?
22.5 What Are the Legal Issues Affecting an Alliance in Bulgaria?
23 How Does Collaborative Procurement Operate in Germany?
23.1 What Is the Approach to Construction Contracts in Germany?
23.2 What Is the Approach to Alliances in Germany?
23.3 What Is the Potential for a Framework Alliance in Germany?
23.4 What Is the Approach to BIM in Germany?
23.5 What Are the Legal Issues Affecting an Alliance in Germany?
Acknowledgements
24 How Does Collaborative Procurement Operate in Italy?
24.1 What Is the Approach to Alliances in Italy?
24.2 What Is the Approach to BIM in Italy?
24.3 What Is the Approach to Construction Contracts in Italy?
24.4 What Is the Potential for a Framework Alliance in Italy?
24.5 What Are the Legal Issues Affecting an Alliance in Italy?
25 How Does Collaborative Procurement Operate in the USA?
25.1 What Is the Approach to Alliances in the USA?
25.2 What Is the Approach to BIM in the USA?
25.3 What Is the Approach to Construction Contracts in the USA?
25.4 What Is the Potential for a Framework Alliance in the USA?
25.5 What Are the Legal Issues Affecting an Alliance in the USA?
Appendix A: Research Timelines
A.1 How Has Improved Value Been Delivered Using Early Contractor Involvement, Collaborative Working and BIM?
A.2 What Is the Relationship Between Procurement, Contracts and BIM?
A.3 What Are the Benefits of a Standard Form Framework Alliance Contract?
Appendix B: Trial Projects Process
Appendix C: Case Studies
Appendix D: BIM Research Projects and Interviewees
Appendix E: FAC‐1 Consultation Group Members
Appendix F: Amendments to FAC‐1 and TAC‐1 Consultation Drafts
Consultation on FAC‐1 and BS11000 (ISO 44001)
Other Consultation Feedback
Appendix G: Completing FAC‐1
Part 1 – Completing the FAC‐1 Framework Alliance Agreement
Part 2 – Completing the FAC‐1 Framework Documents
Bibliography
Chapters 1-19
Chapter 20 (Australia)
Chapter 21 (Brazil)
Chapter 22 (Bulgaria)
Chapter 23 (Germany)
Chapter 24 (Italy)
Chapter 25 (USA)
Index
End User License Agreement
List of Illustrations
Chapter 1
Diagram 1 Team members, data and issues viewed through collaborative constructi...
Chapter 2
Diagram 2 Summary of Two Stage Open Book.
Diagram 3 Two Stage Open Book, Cost Led Procurement and Integrated Project Insu...
Diagram 4 Summary of Supply Chain Collaboration.
Chapter 4
Diagram 5 Integration through a framework alliance contract.
Chapter 8
Diagram 6 Features of classical, neo‐classical, relational and enterprise contracts.
Chapter 9
Diagram 7 PPC2000 Preconstruction phase and construction phase processes.
Chapter 10
Diagram 8 Structure of FAC‐1.
Diagram 9 Award processes under FAC‐1.
Chapter 11
Diagram 10 Warranties and defects on Project Horizon.
Diagram 11 Savings on Project Horizon.
Chapter 13
Diagram 12 CDE – management during design and construction.
Diagram 13 Documents describing team member deadlines.
Diagram 14 Asset and operation and maintenance as BIM driver.
Chapter 22
Diagram 16 BIM drivers in Bulgaria in 2017.
Diagram 17 Table of the agreed amendments between the English and Bulgarian versions of...
Chapter 24
Diagram 18 Number of public procurement claim disputes, before the Regional Adm...
Diagram 19 Table of differences between the English and the Italian versions of FAC‐1.
Chapter 25
Diagram 20 Optimal IPD elements.
Diagram 21 A simple framework for IPD.
Diagram 22 Regional maturity of BIM use.
Guide
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Collaborative Construction Procurement and Improved Value
David Mosey
Centre of Construction Law & Dispute Resolution Dickson Poon School of Law King's College London
Copyright
This edition first published 2019
© 2019 John Wiley & Sons Ltd
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, except as permitted by law. Advice on how to obtain permission to reuse material from this title is available at http://www.wiley.com/go/permissions.
The right of David Mosey to be identified as the author of this work has been asserted in accordance with law.
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Library of Congress Cataloging‐in‐Publication Data
Names: Mosey, David, 1954- author.
Title: Collaborative construction procurement and improved value / David Mosey.
Description: Hoboken, NJ : Wiley-Blackwell, 2019. | Includes bibliographical
references and index. |
Identifiers: LCCN 2019000081 (print) | LCCN 2019004042 (ebook) | ISBN
9781119151920 (Adobe PDF) | ISBN 9781119151937 (ePub) | ISBN 9781119151913
(hardback)
Subjects: LCSH: Buildings–Specifications–Great Britain. | Construction
contracts–Great Britain. | Building materials–Purchasing--Great
Britain–Case studies. | Building information modeling–Great
Britain–Case studies. | Government purchasing–Great Britain. | Public
contracts–Great Britain.
Classification: LCC TH425 (ebook) | LCC TH425 .M64 2019 (print) | DDC
354.6/42530941–dc23
LC record available at https://lccn.loc.gov/2019000081
Cover Design: Wiley
Cover Image: © Association of Consultant Architects Ltd.
Reviews
Sir Rupert Jackson PC, former Lord Justice of Appeal:
‘A successful procurement exercise or construction project is one in which all participants work together collaboratively to achieve a common end. That is not easy to achieve because the participants each have their own commercial interests and reputations to protect. I have long believed that the mere inclusion of platitudes that "the parties will work together in good faith" adds little to the implied term of co‐operation, and a series of recent cases have shown that such wording seldom avails the parties when a dispute erupts.
The present book goes far beyond platitudes. It explores new ways of working and new contractual structures which can actually bring about collaborative working. It demonstrates how the use of BIM can facilitate the ready sharing of information between members of the team. It explains how the team members can benefit from the creation and development of a project alliance. The research and case studies set out in this book will offer practical guidance to all who are working in the construction sector.’
Professor Phillip Capper, Head of International Arbitration, White & Case:
‘Improvement of risk management in international construction projects is vital, and Professor Mosey’s challenging book shows how this can be achieved through team integration and early contractor involvement. The focus has to widen from the typical client/main contractor preoccupation, and this penetrative study shows how supply chain collaboration is vital.
Beginning from the lasting initiatives inspired by Sir Michael Latham in 1994, Professor Mosey explores how team selection and contractual commitments can help build a collaborative culture. We see how collaborative procurement is connected to contracts, and also to BIM and other digital technology. Empirical evidence is grounded in case studies and King's College London research led by Professor Mosey, which is enhanced by leading co‐authors' analyses from other major economies. Collaborative construction procurement demonstrably can reduce disputes, and this book enables a global readership to see which forms of contract can achieve better construction project performance.'
Ann Bentley, Construction Leadership Council Board Member, Rider Levett Bucknall Global Board Member and author of ‘Procuring for Value’:
‘As any harassed parent knows, telling restive children to “play‐nicely” is no guarantee that they will. Collaboration is much the same, and a broad expression of collaborative intent is no guarantee of collaborative behaviour: it requires knowledge, structure and commitment. With this comprehensive and far‐reaching analysis, taking us from the birth of collaborative contracts to their relevance and use around the world, David Mosey and his King's College team go a very long way to filling important knowledge gaps.
This book should be recommended reading for anyone considering undertaking a construction project, and compulsory reading for their advisers. I commend David and his team for this work and the contributions that it will make to improving the way construction is procured and delivered.'
Mark Farmer, CEO Cast Consultancy and author of ‘Modernise or Die’:
‘There is a crucial need to adopt an integrated procurement model in order to deliver projects more efficiently, for example through increasing “pre‐manufactured value” by moving processes from the final site into controlled manufacturing environments. I commend this book whose international co‐authors have collated an excellent global reference point, demonstrating how organising projects differently can create better outcomes for all parties.
The recommended procurement and contract systems are shown to achieve better aligned interests by harnessing learning and relationships from project to project and by using value‐based selection and remuneration techniques. Unless you can deliver specific value‐adding expertise through integrated working behaviours, the construction world will become an increasingly difficult place to make money and survive. Reading this publication is a vital part of future‐proofing yourself!’
Professor John Uff CBE QC:
‘This seminal work brings together the fruits of studies and writings spanning many years and encompassing many projects throughout the world under a variety of legal systems. The need for collaboration in the construction process has been a constant theme in the search for procedures and systems which can harness the expertise and energies of parties with divergent commercial interests while avoiding disputes.
Procurement is the point at which collaboration begins, with the choice of project alliancing for a single enterprise or a framework or other longer‐term arrangement bringing wider opportunities for collaboration. These extended relationships are supported by the authors’ work in developing the FAC‐1 and TAC‐1 models for which impressive case studies are described. The key to success is seen as the development of personal relationships, enhanced by digital technology including BIM, shared knowledge and appropriate motivation.'
Shelagh Grant, Chief Executive, Housing Forum:
‘David Mosey’s extensive knowledge of the construction industry, and his well thought through solutions to delivering the best possible outcomes, come over strongly in this work. Many examples are given of the collaborative links and early interactions that help achieve good quality and good value in difficult and complex situations.
The elements of successful collaboration are clearly laid out with particular emphasis on the selection of and relationships between team members. The application of digital technology is shown to work in particular alliance with this approach.'
Matthew Bell, Senior Lecturer and Co‐Director of Studies for Construction Law, Melbourne Law School:
‘For many in the construction industry, collaborative procurement is the holy grail. This new text by Professor David Mosey and leading practitioners from around the world provides a uniquely‐valuable road map in pursuit of that goal. It not only explains the benefits of collaborative ways of working, it also helps industry professionals and their lawyers navigate the potential pitfalls by compiling a critical assessment of experience to date.
The text harnesses lessons learned and the value of technological innovations such as BIM. In this way, it provides both a “how to” and “why to” manual for realising the potential of collaborative construction procurement as we enter the third decade of the 21st century.’
Nick Barrett, Editor, Construction Law:
‘Anyone viewing a typical construction project sees the impressive collaboration that brings designs, people, machinery and materials together in the one place, but they may not see the dangerous divisions that still exist in construction's procurement and contractual underpinnings.
This book's authors show how a new focus on collaborative procurement can treat many of the industry's ills. Evidence has been gathered internationally, not just from the UK, that collaborative approaches can make a major difference to outcomes.
The need for a new industry strategy has never been greater, particularly after the Grenfell Tower disaster and the Carillion collapse. Collaborative procurement approaches that can be easily adopted are detailed in these pages, with a diversity of case studies that should convince even the sceptical.’
Jason Russell, Executive Director, Highways, Transport & Environment, Surrey County Council:
‘As a Local Government Director, I am being challenged as never before to reduce costs whilst improving outcomes for our communities.
This timely book demonstrates that bringing together the wider supply chain at the right time, with clear outcomes and underpinned by effective processes, can deliver significant benefits. It provides a practical guide, built on the experience of many projects that have delivered proven results over a number of years, and it is essential reading for anyone interested in getting better value from their construction projects.’
Dr David Hancock
,
Construction Director
,
Infrastructure and Projects Authority
,
Cabinet Office:
‘Since the success of Terminal 5 Heathrow, I have been a great supporter of collaborative approaches and ECI for complex construction projects. This book recognises that collaboration may not be a universal panacea, and it sets out the arguments and opportunities that need to be debated prior to making procurement decisions. Where those opportunities outweigh the risks, it provides the foundations both contractually and behaviourally to ensure the best chance of success, with real examples from industry.
This is a book that will benefit both the novice and the expert, providing a high‐level overview and a dive into details for the practitioner to implement, without bias to a single contract type and with guidance on Alliance Contract forms for those who wish to realise their benefits.’
Kevin Murray, Deputy Director ‐ Construction & Property, Government Property Agency:
‘This book provides comprehensive evidence that lays waste to the myth that collaboration does not need contractual provisions, commitment and accountability.’
Mark Bew MBE, Chair of PCSG Consultancy and former Chair of the UK Government BIM Task Group:
‘The only moving parts in procurement are the client, the supply chain and a contract defining the relationships between them, yet surprising complexities soon emerge in aligning their different agendas, incentives and required outcomes. This is when poor information often creates the shadows, fears and misunderstandings that are the enemies of aligned goals and collaboration.
This book has drawn on the author's vast experience of creating contracts which acknowledge these challenges, and which seek to use existing data and management techniques to create clear, open processes that work effectively. Any client or supplier should read and understand the techniques described in this book, as they remove waste and friction and can be applied to all client‐supplier relationships in ways that provide significant benefits.’
Dr Kristen MacAskill, Course Director, Construction Engineering Masters Programme, Department of Engineering, University of Cambridge:
‘This book presents a wide‐ranging discussion on what underpins successful partnering in the construction industry, supported by evidence of achievements in both UK and global case studies. While recognising that the form of contract alone will not deliver project success, David Mosey demonstrates how contract arrangements can help facilitate more collaborative attitudes and behaviours.
The chapters explore the benefits of collaborative arrangements in construction contracts, potential shortfalls in the execution of those arrangements and solutions to manage risks. David outlines not just the contractual mechanisms but also the wider people and process considerations required for real benefits to be delivered. Many angles are explored and it is possible to pick up this book and start on the questions that resonate most with the reader.’
Don Ward, Chief Executive, Constructing Excellence:
‘Many people have worked to implement the recommendations of Latham and Egan for construction reform, but few can match David Mosey’s first‐hand experience and expertise in delivering the approaches which he promotes in this book with characteristic clarity and skill. He has probably worked on more collaborative projects than anyone else in the UK construction industry in the last two decades. He can literally point to billions of pounds worth of projects which he directly influenced and helped on a journey to implement better collaboration, using contracts and procurement routes as key enabling tools.
Consequently, David has had more success and gained extensive first‐hand knowledge of what works and what doesn't, and the plentiful case studies throughout this book illustrate this so very well. I have been honoured to work alongside him, including in the trial projects programme on which he draws heavily, and I hope this book will provide many more people with access to his thinking, approaches and practical advice. I hope you find David's experience and expertise as valuable as I have done, and that he convinces you to implement collaborative procurement just as energetically.’
Preface
Let's dig tunnels.
Let's build bridges.
Let's get close like clouds of midges.
What was under Mr. Brunel's hat?
His love letters
And his sandwiches.
Let us cross that big divide.
Let us go and coincide
And with space between deducted
Let us mind what's been constructed.
You provide the motion and I'll start the debate
You provide the provender and I'll supply the napkin
and the plate.
Let's combine this life of mine with your own slender
fate.
Let me elaborate.
Let's be thick as thieves can be.
Let's thicken up the ice and then entice the world to
skate.
You be narrow. I'll be straight.
You be weight and I'll be volume.
Let's make a pair of zeros
make a bigger figure of eight.
Let's collaborate.
With kind permission of John Hegley, an inspiring collaborator ‘Let us Play’, taken from ‘Peace Love and Potatoes’, Profile Books 2012
Acknowledgements
Firstly, I offer heartfelt thanks to my co‐authors Howard W. Ashcraft, Dr Wolfgang Breyer, Professor Paula Gerber, Professor Stefan Leupertz, Marko Misko, Mariana Miraglia, Matatias Parente, Dr Alexandre Aroeira Salles, Adriana Spassova and Professor Sara Valaguzza. Their contributions to this book are fascinating and their work in the field of collaborative procurement is an inspiration to anyone exploring what can be done to integrate theory and practice across different jurisdictions.
In addition, I offer my gratitude and respect to friends and colleagues at King's College London, Trowers & Hamlins and the Association of Consultant Architects, and to all the practitioners, academics, project teams and research groups who have helped me understand how collaborative construction procurement can deliver improved economic and social value. I am also very grateful to Jo Howard for her thoughtful proofreading of this book and to Dr Paul Sayer and all at Wiley for their patient support.
I owe a particular debt to my father Victor Alfred Mosey and to four other remarkable men for their wisdom and guidance whenever I embarked on new endeavours, namely Anthony Gosselin Trower, H.E. Yousuf Ahmed Al‐Shirawi, Sir Michael Latham and Professor David D. Caron.
This book is dedicated to my wife Cécile.
February 2019
David Mosey
King's College London
About the Authors
Professor David Mosey PhD is Director of the King's College London Centre of Construction Law and Dispute Resolution and is former Head of Projects and Construction at Trowers & Hamlins solicitors where he worked for over 30 years as a specialist construction lawyer. He has advised on a wide variety of construction and engineering projects in the UK and internationally, with a particular focus on collaborative construction procurement.
David has been described in the Chambers Guide to the Legal Profession as a ‘partnering guru’ who ‘gives something to the industry’. He is principal author of the PPC2000 suite of partnering contract forms, and led the research and drafting of the FAC‐1 Framework Alliance Contract and the TAC‐1 Term Alliance Contract.
David was a lead mentor for the UK Government Trial Projects programme, testing the savings and other benefits achieved through the combination of early contractor involvement, collaborative working and Building Information Modelling. He won the UK Constructing Excellence Achievers Award in 2009, and in October 2015 was awarded the Association of Consultant Architects medal for services to the architectural profession. For three years David was a Senior Visiting Fellow at Melbourne Law School, and he is currently a Fellow of the Cambridge University Engineering Masters Programme. He is also a member of the Comitato Scientifico of the Milan Centre of Construction Law & Management.
Howard W. Ashcraft has led in the development and use of Integrated Project Delivery and Building Information Modelling in the United States, Canada and abroad. Over the past decade, his team has structured over 130 pure IPD projects and worked on many highly integrated projects. He co‐authored the AIACC's Integrated Project Delivery: A Working Definition, the AIA's IPD Guide, Integrating Project Delivery (Wiley 2017) and Integrated Project Delivery: An Action Guide for Leaders (Pankow Foundation 2018), and he has chaired subcommittees for the National Building Information Modelling Standard (NBIMS).
A partner in the San Francisco law firm of Hanson Bridgett, Howard is an elected Fellow of the American College of Construction Lawyers, an Honorary Fellow of the Canadian College of Construction Lawyers, a Fellow of the American Bar Foundation and an Honorary Member of AIA California Council. In addition to his professional practice, he serves as an Adjunct Professor of Civil and Environmental Engineering at Stanford University.
Dr Wolfgang Breyer is a specialist construction lawyer advising contractors, engineers and employers on major projects such as wind parks, hydropower stations, road and rail, offshore energy and power plants in the Middle East, Asia, Africa and Europe. His areas of expertise include international and German construction contracts, construction risk management advice, and international construction arbitration, litigation, adjudication and alternative dispute resolution.
In May 2015, Dr Breyer led the creation of the International Construction Law Association, bringing together families of law from around the globe in order to inform and debate comparatively on construction law issues. He is a well‐known speaker and writer on construction law, and is also creator and Practice Director of the Masters' Programme in International Construction: Law and Practice at the University of Stuttgart.
Professor Paula Gerber has been a lawyer for over 25 years. She spent five years working as a construction lawyer in London and five years in Los Angeles, before returning to Australia where she became a partner in a leading Melbourne law firm. Paula moved from private practice to academia and is now a Professor at the Monash University Law School. She is an internationally recognised expert in construction law, in particular in the areas of dispute avoidance processes (DAPs) and dispute resolution processes, particularly ADR.
Professor Gerber is the lead author of Best Practice in Construction Disputes: Avoidance, Management and Resolution (LexisNexis 2013), which was a finalist in the prestigious Centenary Book Award. She is also the author of numerous journal articles and book chapters.
Professor Stefan Leupertz is a former Judge of the German Supreme Court and is known as one of the leading legal authorities on construction law in Germany. During his tenure as a judge, he was assigned to the Seventh Civil Division, responsible for hearing construction, contract and architectural law disputes. In 2012 Professor Leupertz resigned as a judge and commenced his own practice Leupertz Baukonfliktmanagement with the focus purely on construction law – in particular, dispute avoidance and dispute resolution – acting as an arbitrator, adjudicator and legal expert. Professor Leupertz is highly respected in academia as co‐editor of the German construction law journal, Baurecht, and as editor/author of numerous publications on German construction law. He sits on boards that include the Arbitral Tribunal Estate Law Germany, the German Baugerichtstag e.V, the Anglo‐German Construction Law Platform and the International Construction Law Association.
Mariana Miraglia is a partner of Aroeira Salles Advogados and acts for domestic and overseas clients in relation to major infrastructure projects in Brazil. Her areas of expertise include the legal management of construction contracts, procurement, civil investigations, public project auditing, compliance and regulatory law. Mariana's international experience includes advice in respect of cross‐border contracts executed in Brazil, preparing for complex arbitration proceedings in New York and advising on an infrastructure project in Africa.
Marko Misko has been involved in the delivery of major Australian infrastructure projects for almost 30 years, across a wide variety of sectors that include transport, defence, health, education, foreign aid, housing, energy and natural resources, and commercial property development.
Marko is committed to driving greater collaboration within the construction industry through procurement methods, project delivery models, risk allocation and standard form contracts. To that end, Marko has worked with all Australian forms of collaborative contracting including managing contractor, project alliancing, delivery partner model, early contractor involvement and most recently integrated project delivery (IPD). Marko has spent the past five years assisting the Australian Department of Defence in finalising its third generation suite of IPD standard form delivery models, designed to facilitate maximum collaboration among all key project contractors/stakeholders and to make optimal use of Building Information Modelling.
Matatias Parente is a lawyer at Aroeira Salles Advogados, advising clients on all aspects of the delivery of construction and engineering projects, from procurement and the drafting and negotiation of contracts, to contract administration and the avoidance and resolution of disputes. He has advised clients operating across a range of sectors including shipbuilding, oil and gas, energy and mining, also assisting them on regulatory compliance matters.
Dr Alexandre Aroeira Salles is founding partner of the Brazilian law firm Aroeira Salles Advogados and advises on large‐scale infrastructure and energy projects. His areas of expertise include construction disputes, procurement, public‐private partnerships and concession arrangements, and the legal management of construction and energy contracts. Alexandre is a founding member of the Brazil Infrastructure Institute and a director of the Brazilian Construction Law Institute. He also holds a doctorate from PUC University in São Paulo and is widely published, in particular in the area of construction law.
Alexandre's expertise is recognised internationally. He is on the board of the International Construction Law Association and regularly speaks at high‐profile international conferences, including in London, Paris, Beijing, Dubai and São Paulo. Alexandre is independently ranked as a leading lawyer in international legal directories.
Adriana Spassova is a civil engineer with more than 30 years' professional experience as a designer, construction manager and consultant. She has an MSc in Construction Law & Dispute Resolution from Kings' College London and is Vice President of the European Society of Construction Law, Chair of the Bulgarian Society of Construction Law and the only FIDIC Accredited Dispute Adjudicator & Trainer in Bulgaria.
As a partner at EQE Control, Adriana has managed consulting services for the biggest project in Bulgaria, namely the 600 MW TPP AES Galabovo (€1.5 billion), as well as for the 156 MW St. Nikola Wind Park Kavarna, the 176‐m Europe Tower Sofia, the Varna Business Park and 6 World Bank projects. In the last three years, she has been a Planning and Contracts Key Expert in the preparation of railway projects with a €1 billion budget.
Adriana has more than 20 years' experience in preparation of FIDIC tender documentation and in acting as an engineer in nuclear safety, waste management and infrastructure. She is also a claims consultant and an expert in arbitration and DAB. She has delivered FIDIC accredited training in Bulgaria, Russia, Ukraine, Kazakhstan, Uzbekistan and Belarus.
Professor Sara Valaguzza is Professor at the University of Milan, where she teaches public‐private partnerships, public contracts and environmental law. Her interests focus on strategic regulation, alliancing, construction law, sustainable development, procuring for value and legal BIM. Sara practises as an attorney for Italian and international clients. Her firm is a reputed legal ‘boutique’ in Italy, assisting public authorities and private companies in many significant construction and urban regeneration projects, such as the Blue and Lilac Line subway construction in Milan and the post‐Expo development.
Sara leads an interdisciplinary research group promoting collaborative contracts in public and private fields. Since 2016 she has been Deputy Director of the Milan Centre of Construction Law & Management, and Head of the European Association of Public‐Private Partnerships. With more than 40 publications in different languages, her latest book Procuring for Value – Governare per contratto creare valore attraverso i contratti pubblici promotes reform of the construction industry by the use of collaborative contracting and BIM to create added value in strategic public procurement.
1What Is Collaborative Construction Procurement?
1.1 Overview
Collaborative construction procurement comprises a set of processes and relationships through which teams can develop, share and apply information in ways that improve the design, construction and operation of their projects. It supports team selection and team integration, and it offers a fresh approach to legal and cultural issues that can otherwise reduce efficiency and waste valuable resources.
This book explores the delivery of economic and social value through improvements in strategic thinking, team selection, contract integration and the use of digital technology, and it considers how the processes and relationships of collaborative construction procurement can be brought more into the mainstream. It uses analysis, guidance, and case studies to illustrate how collaborative approaches can be adopted successfully by any team in any part of the construction sector. With contributions from six other countries, this book also shows how the models that comprise collaborative construction procurement can operate in a range of common law and civil law jurisdictions.
Many procurement models provide little time or opportunity for consultants, contractors, subcontractors, manufacturers and operators to integrate their work. Instead, these models attempt to fix prices without joint cost analysis and to transfer risks without joint risk management, often encouraging misunderstandings and disputes that lead to cost overruns, delays and defects. This book examines collaborative approaches that can anticipate and avoid the problems created by incomplete data, by fragmented contracts and by the neglect of team integration.
We will review the collaborative bridges that connect and integrate the work of different team members and that translate their aspirations into actions, plus a range of factors that may encourage or obstruct progress. New procurement models will not gain widespread support unless they offer benefits for all parties, and we will examine the ways in which procurement processes, digital technology and collaborative contracts can accommodate the differing aspirations and requirements of all team members.
This chapter summarises recent research and commentaries that identify the need for procurement reform, and notes the links between collaborative procurement, digital technology and contracts. Chapter 2 considers the foundations for collaborative construction procurement and Chapter 3 describes the features of collaborative working through a project alliance. Chapters 4 and 5 consider the greater potential for improved commitments and improved outcomes where team members create strategic alliances through frameworks and other long‐term contracts.
Chapters 6–8 consider how collaborative team members are selected, whether collaboration needs a contract at all and, if so, whether a new type of contract is required to fulfil this role. They explore how team selection and contractual commitments can help to build a collaborative culture, and test whether team members can integrate their work by making non‐binding declarations. The collaborative and alliance features of standard form project contracts are considered in Chapter 9, and the FAC‐1 Framework Alliance Contract and the TAC‐1 Term Alliance Contract are explained in Chapters 10 and 11.
Collaborative construction procurement needs to be sustained by personal relationships, and different ways to create and support a collaborative culture are explored in Chapter 12. The potential for digital technology to create new connections between team members, and also to integrate the capital and operational phases of a project, is examined in Chapters 13 and 14, together with the impact of Building Information Modelling (‘BIM’) on procurement and contracting practices.
The lessons learned from case studies show how economic and social value can be improved through collaborative construction procurement, and these are considered in Chapter 15. The different options available for costing, incentivising and programming a collaborative project or programme of work are considered in Chapters 16 and 17. Collaborative risk management systems are analysed in Chapter 18, and collaborative ways to avoid or resolve disputes are explored in Chapter 19.
Chapters 20–25 have been contributed by leading practitioners in Australia, Brazil, Bulgaria, Germany, Italy and the USA. They describe how new approaches to procurement, contracts, and BIM are adopted in each country, and explore the different challenges arising in common law and civil law jurisdictions.
1.2 What Is Collaborative Construction Procurement?
This book uses the terms ‘collaborative construction procurement’ and ‘collaborative procurement’ to describe how projects and programmes of work can be planned and delivered by integrated teams. It examines how collaborative procurement can be supported by early contractor involvement, by digital technology such as BIM and by new contractual structures and processes in order to improve the outputs from construction, engineering and asset management.
Construction projects should always be a team endeavour, yet despite extensive evidence as to the benefits of collaborative working, most procurement models and contracts do not support teamwork but instead focus on the transfer of risk down the supply chain. This traditional defensiveness reminds us that organisations are obliged to protect their own interests, and it is important to examine the extent to which collaborative alternatives provide equivalent or improved legal and commercial protections.
Collaboration among individuals engaged on a project or programme of work is only made possible by integrating the differing needs and commercial priorities of the organisations who employ them. Knowledge is power, and the legal and commercial tests of collaborative construction procurement should include:
Firstly, whether team members build up shared knowledge at a time when it can be used to improve project outcomes
Secondly, whether team members use that shared knowledge to improve project outcomes rather than for their individual benefit.
To pass the first test requires integrated and transparent systems, and to pass the second test requires motivation that aligns different commercial interests. The references to case law in this book illustrate how the courts treat a range of issues in the absence of contractual clarity, and why clear contracts are therefore essential to ensure that the features of collaborative procurement are commitments rather than optional extras.
For the construction industry and its clients to get the best out of collaborative working, and for them to avoid creating new barriers in place of the old ones, they should build the bridges through which:
The agreed objectives of team members are connected to the contracts that support their shared approach to agreed commitments
The people and organisations who contribute to a project are connected to emerging technology
The vision of design consultants is connected to the expertise of the contractors, subcontractors and manufacturers who bring those designs to life
The design and construction of projects are connected to their ongoing operation, repair and maintenance
The experience of the different sectors and different jurisdictions can provide examples of good practice.
In order to create and maintain commercial and legal bridges, construction clients and the teams with whom they work need to develop integrated relationships, transparent data and a clear view of the issues arising. This book considers the new lenses, as illustrated in Diagram 1, through which collaborative construction procurement can improve data transparency and can develop a clear vision of how team members can work together more efficiently.
Diagram 1 Team members, data and issues viewed through collaborative construction procurement.
We will examine the ways in which collaborative options for team selection, project planning and project delivery can:
Help a client to decide whether a construction project should be approached as a team endeavour rather than a cascade of risk transfer
Create new opportunities to ask and answer practical questions as to risk and value
Avoid making risk and value assumptions before team members are selected
Establish what involvement, roles and responsibilities it is reasonable and valuable for all team members to accept.
1.3 Why Is Collaborative Procurement Important?
The success of collaborative construction procurement depends on team members making clear what it is they will do together that they would not do alone, going beyond a general sense of joint purpose to agree in detail how they will integrate their roles and responsibilities in a way that can be compatible with their different commercial drivers. Collaborative models have already proven their value, for example in the UK, the USA and Australia, but they need to be presented and explained more clearly and consistently in order to attract wider support.
It should be possible for changes to be made incrementally rather than by demanding that team members leap across a chasm to unfamiliar territory. In addition to exploring the intellectual and legal challenges generated by no blame clauses and shared pain/gain incentives, we will also examine other collaborative procurement systems such as early contractor involvement, Supply Chain Collaboration, joint project governance, shared digital data, long‐term strategic appointments and whole life asset management.
The success of collaborative procurement models depends on the people who put them into practice and on the ways that they act, react, communicate and seek consensus. These are the features that comprise a collaborative culture, and it is important to examine the ways that they can be developed and sustained. However, we also need to look critically at assertions that a collaborative culture needs only a general declaration of good faith or that it requires the exclusion or limitation of reasonable legal rights and obligations.
Declarations of collaborative principles can create shared values among team members but do not get us very far if they are not translated into collaborative actions. General declarations are of limited value in helping a team to deal with typical risks and challenges in a new way, and failure to honour a collaborative declaration only increases cynicism. Meanwhile, if collaboration is seen as no more than a set of reluctant compromises through which the parties edge away from opposing positions, it is unlikely to create the foundations for a shared commitment to improved value but instead may create a sense of residual dissatisfaction and mutual suspicion.
The global financial crisis in 2008 placed pressure on emerging collaborative procurement models and tempted clients instead to exploit lowest price bids in a cutthroat marketplace.1 However, by 2010 the newly‐elected UK Coalition Government was concerned that artificially low prices would lead to:
Poor quality work by cutting corners
Delayed payment of subcontractors and suppliers
Claims and disputes to make up for lost profit
Increased defaults and insolvencies where unsustainable prices and payment delays become intolerable.
2
As a result, when drafting the 2011 Government Construction Strategy,3 UK Government Chief Construction Adviser Paul Morrell proposed instead the development of reliable data through early contractor involvement combined with collaborative working and BIM as the cornerstones of more efficient procurement and delivery of construction, engineering and asset management. The 2011 Government Construction Strategy recommended that these approaches should be features of three new procurement models and proposed that they should be tested through a programme of ‘Trial Projects’.4 Early supply chain engagement and collaborative working were also features of BS8534, the British Standard for construction procurement published in 2011.100
Recent years have seen a series of reports underlining the need for improved procurement and contracting practices, for example:
The 2016 Farmer report ‘Modernise or Die’
5
The 2017 McKinsey report ‘Reinventing Construction Through a Productivity Revolution’
6
‘Building a Safer Future’, the 2018 Hackitt Review of Building Regulations and Fire Safety
7
The 2018 Housing Forum report ‘Stopping Building Failures, How a Collaborative Approach can Improve Quality and Workmanship’
8
The 2018 Construction Leadership Council report ‘Procuring for Value’.
9
McKinsey recommended that poor productivity in the construction sector means that we need to ‘rewire the contractual framework’.10 In the aftermath of the 2017 Grenfell Tower disaster in London, the Hackitt Report suggested that procurement systems need a complete overhaul because ‘the primary motivation is to do things as quickly and cheaply as possible rather than to deliver quality homes which are safe for people to live in’.11 She highlighted a cultural issue in construction procurement which she described as a ‘race to the bottom’, and emphasised that the reform of current practices should ‘lead to a significant increase in productivity’.12
The UK best practice body Constructing Excellence has championed collaborative procurement for many years, and in 2011 published guidance that included the following three overriding principles:
‘Common vision and leadership: an absolute focus on the end purpose based on a clear understanding by all participants of what represents value for the client and end users. Leadership needs to establish this common vision and then constantly relate progress by the project to this vision to reinforce the team's goal’
