Level: Intermediate
TCM Section(s):
7.7. Procurement Planning
8.1. Project Control Plan Implementation
Venue: 2023 AACE International Conference & Expo
Abstract: In the last 3 years, the global construction industry landscape underwent a dramatic change. Impacts such as COVID-19, the war in Ukraine, economic pressures and focus on social value added additional challenges to procurement in an industry already dealing with several fundamental problems.
The additional impact of a booming construction market for major and mega programs across many sectors in the US, has created an unprecedented challenge in securing supply chain. The competition for scarce resources: materials, services and work, has put an increased emphasis on procurement methodologies and brought procurement planning forward in the project lifecycle.
The wide range of contract and commercial models available today, from traditional design-bid-build, through the progressive design build or CM-GC to various creative hybrid models, offer a wide range of options and opportunities for procurement to ensure project success. However, the selection of a suboptimal procurement strategy can have significant implications on project deliverability within assumed parameters, which may not be felt even for 24 months post contract award, at which time it generally cannot be changed or adjusted.
To ensure creation of a sound procurement strategy, the development of procurement options that aligns with the Total Cost Management Framework offers promising results. The proposed process, in which clients can work through in a structured and methodical way, to identify the criteria, prioritize them and then systematically assess them against a range of contract and commercial options, offers a robust method of arriving at the optimal procurement strategy for the major project today.
TCM Section(s):
7.7. Procurement Planning
8.1. Project Control Plan Implementation
Venue: 2023 AACE International Conference & Expo
Abstract: In the last 3 years, the global construction industry landscape underwent a dramatic change. Impacts such as COVID-19, the war in Ukraine, economic pressures and focus on social value added additional challenges to procurement in an industry already dealing with several fundamental problems.
The additional impact of a booming construction market for major and mega programs across many sectors in the US, has created an unprecedented challenge in securing supply chain. The competition for scarce resources: materials, services and work, has put an increased emphasis on procurement methodologies and brought procurement planning forward in the project lifecycle.
The wide range of contract and commercial models available today, from traditional design-bid-build, through the progressive design build or CM-GC to various creative hybrid models, offer a wide range of options and opportunities for procurement to ensure project success. However, the selection of a suboptimal procurement strategy can have significant implications on project deliverability within assumed parameters, which may not be felt even for 24 months post contract award, at which time it generally cannot be changed or adjusted.
To ensure creation of a sound procurement strategy, the development of procurement options that aligns with the Total Cost Management Framework offers promising results. The proposed process, in which clients can work through in a structured and methodical way, to identify the criteria, prioritize them and then systematically assess them against a range of contract and commercial options, offers a robust method of arriving at the optimal procurement strategy for the major project today.