Just read an article in this weeks Institute of Civil Engineers magazine concerning the change by British Airways Authority (BAA) and other major clients in their approach to procurement. It can be summed up by BAA’s Capital Programmes Directors statements:
"I firmly believe that you have got to have a contract..... Contracts give you the rules"
"I want a co-operative incentivised relationship with my contractors but I don’t want to be their partner. That is important. I want to be their customer."
I’ve personally always argued, but todate without any success whatsoever, that partnering is, (quoting from the article):
"not a matter of let’s hold hands and sing kumbaya around the camp fire..".
Yes, if there’s a problem then partnering means that both parties working together to solve it and one party doesn’t just sit there and say it’s your problem, nothing to do with us. But the contract is the contract and sets out the rules, the risk allocation doesn’t change just because both parties get involved in sorting the problem out. Further, the contract isn’t put in the bottom drawer and forgot about with no one claiming anything additional because that’s "just not partnering".
Also it means neither party tries to put forward splurious claims and all legitimate entitlements are dealt with fairly - key to partnering is the impartial and proper administration of the contract. Key also is each party standing by the risks they have taken on and not trying by clever arguments to get out of those risks. That said, the contractor must be given the opportunity to identify and price those risks, something often not the case in competitive bidding, lowest price wins.
Basically partnering to me is both parties working together where ever possible but still working to what the contract says. If something happens and it’s at your risk, then you take the consequences whether that be a gain or a loss.
This appears to be the new approach that BAA and others are going to take, so are the days of longterm framework contracts and other seemingly cosy and don’t let’s upset anyone approach coming to an end? Is the honeymoon for partnering now over and we’re going to backtrack, not to the old days but something more akin to the older style contracts - say more target cost type contracts? Will this lead to more claims and disputes?
Bottom line, is this new approach good or bad for the industry?
Interestingly for planners the BAA Director also said:
"I want programme managers, not project managers." - send your CV’s in now!
"I firmly believe that you have got to have a contract..... Contracts give you the rules"
"I want a co-operative incentivised relationship with my contractors but I don’t want to be their partner. That is important. I want to be their customer."
I’ve personally always argued, but todate without any success whatsoever, that partnering is, (quoting from the article):
"not a matter of let’s hold hands and sing kumbaya around the camp fire..".
Yes, if there’s a problem then partnering means that both parties working together to solve it and one party doesn’t just sit there and say it’s your problem, nothing to do with us. But the contract is the contract and sets out the rules, the risk allocation doesn’t change just because both parties get involved in sorting the problem out. Further, the contract isn’t put in the bottom drawer and forgot about with no one claiming anything additional because that’s "just not partnering".
Also it means neither party tries to put forward splurious claims and all legitimate entitlements are dealt with fairly - key to partnering is the impartial and proper administration of the contract. Key also is each party standing by the risks they have taken on and not trying by clever arguments to get out of those risks. That said, the contractor must be given the opportunity to identify and price those risks, something often not the case in competitive bidding, lowest price wins.
Basically partnering to me is both parties working together where ever possible but still working to what the contract says. If something happens and it’s at your risk, then you take the consequences whether that be a gain or a loss.
This appears to be the new approach that BAA and others are going to take, so are the days of longterm framework contracts and other seemingly cosy and don’t let’s upset anyone approach coming to an end? Is the honeymoon for partnering now over and we’re going to backtrack, not to the old days but something more akin to the older style contracts - say more target cost type contracts? Will this lead to more claims and disputes?
Bottom line, is this new approach good or bad for the industry?
Interestingly for planners the BAA Director also said:
"I want programme managers, not project managers." - send your CV’s in now!