2015 Canadian Construction Overview Graphic

Article

Procurement Perspectives: Reviewing current delivery methods

0 140 Economic

by Stephen Bauld

The approach government takes to the way construction projects are delivered will have a direct result on the success of the overall project.
Procurement Perspectives: Reviewing current delivery methods

In addition to the significant risk of government waste that can arise from building the wrong project there are also considerable risks in the selection of the wrong method of construction delivery.

When we look at construction delivery it refers to the relationships between the owner, the builder, and the designer.

Procurement and construction delivery methods are related, but different processes.

The procurement method is the process used to award a construction contract.

A construction delivery method is the allocation of responsibilities and the process used to complete construction after a contract is awarded.

The methods must be compatible, but they are separate. Historically, three primary methods have been used to construct government capital projects in North America, but recently a fourth has gained considerable popularity.

Each has advantages and disadvantages and should be used only in situations where its advantages can be beneficial.

Pivotal to each of these relationships is the extent to which the owner of the property on which an improvement is to be considered wishes to participate in or assume responsibility for individual aspects or the entirety of the work that is to be done.

This is an alternative to retaining an independent contractor or contractors, who will be responsible for the work.

The structure of the industry has an obvious relevance to the contracting practices within that industry.

It is axiomatic that the contractual alternatives that are available in a highly concentrated industry will differ markedly from those available in a competitive industry.

At the same time, the size of the construction industry (particularly its size related to other sectors of the Canadian economy) places the importance of the problems which affect the construction industry in a unique perspective.

The construction industry may be divided into two major branches, these being heavy (or engineering) construction and building construction.

As the name implies, building construction includes the construction of most types of building, including: residential and commercial highrise and lowrise structures, industrial buildings (such as factories), commercial developments (such as shopping malls), public buildings (such as schools and hospitals), single-family residential accommodation, and recreation developments.

This list is intended to provide some idea of the scope of building construction. Heavy construction, on the other hand, encompasses a wider range of types of construction than building construction.

Heavy construction includes the production of dams and canals, hydroelectric works, highways, railroads, tunnels, subways and tubes, bridges, marine construction (being the construction of both aqueous and sub-aqueous works such as piers, jetties, breakwaters, and even dredging), airports, pipelines, and pumping stations, water and sewer lines, sewage plants and anti-pollution installations, atomic and thermal electrical power plants, defence installations and structures, power transmission lines, and mines.

There tends to be more activity on the building construction side than heavy construction.

The contracting process often begins before the construction is put out for competition, in the form of a tender or a Request for Proposal. Many municipalities and other public authorities pre-qualify eligible bidders for construction and other major contracts.

I think this is the best way to attract bidders capable of completing the work with the least amount of issues related to the project.

It is very important all major construction projects are pre-qualified regardless of which method of delivery used.

Make sure you chose the correct method of procurement that applies to the specific construction project.

Stephen Bauld is a government procurement expert and can be reached at stephenbauld@bell.blackberry.net.

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