Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Construction Management 3 > Contract Strategies and Procurement > Flashcards

Contract Strategies and Procurement Flashcards

(76 cards)

Start Studying
1
Q

What is tendering?

A

Tendering is the industry name for obtaining an offer from a contractor, which can then be accepted by the employer to form a binding contract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Outline the tender process.

A

1)Design project - prepare tender docs
2) Choose tendering option -Tender documents ‘go out for tender’
3)Tender period - pricing the tender - tenders returned
4)Assess returned tenders
5) Select successful tender - sign contract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Who prepares tender documents?

A

Designers will prepare the tender documentation on behalf of the client

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is included in tender documentation?

A
  • Invitation to tender and detailed tender instructions
  • Conditions of contract and contract data
  • The payment mechanism
  • Works information - drawings, specifications, health and safety information.
  • Site information
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What are the three main types of tender option?

A

Single Bid, Two-bid options, Framework Agreements

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What is open tendering?

A

Any interested party can bid, work advertised in relevant publications

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What is selective tendering?

A

Invitation sent to pre-selected firms for option to apply

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What is pre-qualification tendering?

A

Assessing capabilities/suitability of a contractor before inviting them to submit tenders

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Advantages of open tendering?

A

Competitive
Transparent (no favourites)
Cost savings - people under bidding each other
New firms can enter market

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Disadvantages of open tendering?

A

Time consuming
Price over quality
Unqualified candidates
Limits to long-term relationships

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Advantages of slective tendering?

A

Quality assurance
Competitive pricing
Client has more control
Improved contractor client relations

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Disadvantages of selective tendering?

A

Time consuing
Not transparent (potential bias)
Limits for new comapnies
Only suitable for larger projects

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Advantages of pre-qualification tendering?

A

-Combination of open and selective
-Client can ensure only the most qualified are invited to tender
-Reduced risk
-Streamlines tender process
-Great transparency with no bias- assessed objectively

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Disadvantages of pre-qualification tendering?

A

Lengthy process
Cost of resources for selction process
Limited competition, reduced amount of bidders

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is negotiatied procurement?

A

Client goes directly to preferred supplier and negotiaties instead of formal tendering process

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Advantges of negotiatied procurement?

A

Contractor is known so client has more control and certainty
Time-saving
Opportunity for innovation
Improved client/contractor relationship

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Disadvantages of negotiated procurement?

A

Non competitive
Bias
Disagreements on scope due to lack of tendering process

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What is two-bid tendering process?

A

Involves pre-qualification followed by bid for tender

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Advantages of two-bid tendering process?

A

Contractor has full understanding of process
Greater cost certainty
Reduced risk of delays

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Disadvantages of two-bid tendering process?

A

Might not price as competitively as one-bid
Time consuming
Costly additional pre-qualificaiton

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What are framework agreements?

A

Long term agreements between client & contractor/s to procure goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Advantages of framework agreements?

A

Consitent pricing
Better client contractor relations
Better colaboration due to long term
Reduced procurement times

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Disadvantages of framework agreements?

A

No variety/chance of lowering price
Reduced motivation from contractor
Client is committed to using same contractors even if better options become available

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

How long is the tender process?

A

4-8 weeks. Designers and clients answer any queries

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
How is a tender chosen?
Tender report compiled by desinger, client tries to balance quality,time and price
26
What happend when a tender is accepted?
Letter of acceptance to winner Unsucceful tenders get notified - list of tenders names and prices sent out. Tender document becomes ocntract document.
27
What is a contract strategy?
Determines the contract links between the employer, the designer(s), the contractor and sub-contractors (works contractors)
28
What is a contract link?
Rights and obligations under contract terms.
29
What are adminstrative links?
Administration of contracts
30
What are the factors affecting contract strategy choice for a client?
Timescale Knowledge Funding Risk acceptance
31
What are the factors affecting contract strategy choice for a designer?
Experience (team) Benefit of contractor involvement Clients improvement
32
What are the factors affecting contract strategy choice for a contractor?
Availibility of work Future work Payment and risk
33
What is a traditional contract?
Seperate design and construction Design appointed first Design complete by contrator appointment Designer acts are contractors admin during construction
34
What is a design and build contract?
Project requirements clearly states in contractors brief Could include prelim design Throurough checks at tendering process Good for simple Good for complex - lots of intricate construction techniques
35
What are the advantages of traditional contracts?
Clients design requirements fully understood by designers Early design work can be approved Changes/pausing of project are cheaper as design is seperate from construction Client has more price certainity
36
What are the disadvantages of traditional contracts?
Strategy is slower overall No teamwork More misunderstanding of tender docs Can't tell if defects are due to design or construction Delays are clients fault
37
What are the advantages of D&B contracts?
"Buildability" can be incorporated into design Clients only buy services from one organisation Client not responsible for design delays Quicker to contract completion Quicker site start -design parallel w construction Less misunderstandings between designers and constructors
38
What is novation?
Legal mechanism where one contract is trasnferred for another. Rights and obligations passed from one party under contract to a third party
39
What are the benefits of novation?
No loss of knowledge from preliminary designer Helps client achieve well devloped design Possible mismatches in designer/contractor can be rectified
40
What are 'managament' contract strategies?
Contractor is appointed early to a contract with the employer. The 'management contractor' or 'Construction manager' does not undertake any actual construction work. The management contractor or construction manager works on management, liaison and coordination of construction work and 'partnering' with the employer and design team during the design stage.
41
What are the advantages of 'management' contract strategies?
Contractor can input to design stage with construction expertise Good for large/complex projects Work packages for subcontractors can be phased Management contractor takes responsibility of sub-contractors 5-10% fee of construction cost
42
What are the disadvantages of managemnt contract strategies?
Contrator carries interface risk Late payments to sub-contracotrs
43
What is interface risk?
Problem with one contract often has affect on contracts that interface it, delays can add up
44
What are contruction management strategies?
Construction manager manages & coordinates contractors Normally QS or proj managers Not contractually liable for contractors performance
45
What are the advantages of construction management strategies?
Works contractors are direct contractors to the employer and the employer has input into their selection. Work packages are awarded as the project progresses so some changes can be accommodated. Good for early start on site (often with incomplete design) Construction manager is paid a fee.
46
What are the dsiadvantages of construction management strategies?
Client carries interface risk EU regs on every contract, must be advertised as such
47
What is a partnering stratergy?
Collaborative management - client and contractor Share risks and rewards Non-binding Each retains own identitity
48
Two types of partnering strategy?
Strategic - more than one project Project - One off
49
3 elements of partnering?
Agreed mutual objectives Problem solving mechanism Commitment to continuous improvement
50
How is partnering set up?
Contract awarded to successful tenderer Tenders invited to partnering workshop Partnering charter is created
51
What are the advantages of partnering?
Reducing tendering times and costs Anticipating and avoiding disputes Securing contractors best staff Reducing duplication of management and supervision Achieving quicker start to construction
52
What is an alliance?
Groups of companies who agree to cooperate and to share gains and losses in some way Alliances can be between contractors or designer and contractor(s) Do not form an actual company, CONTRACTURALLY BINDING
53
What is a joint venture?
Participants form an actual company as a LEGAL entity
54
What is a consortium?
International joint venture company owned by at least 3 organisations
55
What are the advantages of alliances and joint ventures?
Increased oppurtunity for large projects/framework agreements Knowledge sharing and new skills Share resources and expertise Specialist equipment Reduced admin - greater efficiency Shared risks
56
What are the disadvantgaes of alliances and joint ventures?
Difficult to combine the culture of different organisations. *Organisations will have different systems and processes. Potential 'power struggle' (especially if not equal shares) and leadership issues. Potential restructuring of the original business. Concerns about confidentiality and intellectual propertY
57
What is a consortium?
Internation joint venture - at least 3 organisations
58
What is a private finance initiative?
Private public partnership funding schools and hospitals etc
59
What is a framework agreement in terms of contracts?
'Serial strategy' for setting up a number of similar contracts over a period of time.
60
What are the advantages of a framework contract?
Long term agreement improving teamwork and communication Reduce misunderstandings Improved efficientcy with joint admin, IT, payments Economics of scale for all participants Joint purchasing agreements Long term incentive arangements Simplified contract conditions
61
What are some client specific advantages of framework contracts?
Process of advertising and awarding work (EU Regs) only needs done once Selection and awarding completed before full details of project known Individual contracts can be set up quickly once framework in place
62
What are some contractor specific advantages of framework contracts?
Long term - understand clients AND designers needs Be involved in early planning, development Predictability of work flow Contractor can set up longer term relationships with suppliers and sub-contractors Possibility of local office set up
63
What are some disadvantages of framework contracts?
Initial tendering can be costly Unsuccesful contractors lose touch with client Difficult to plan for unexpected market changes Difficult to break unsuccessful framework agreement, if broken costly and time consuming to set up a new one
64
What is BREEAM assessment?
BRE Environmental Assessment Method
65
What and how does BREEAM assess a project?
Awards points or credits and groups environmental impacts: * Energy: * Management: * Health and Wellbeing * Transport * Water consumption and efficiency * Materials: * Waste * Pollution * Land Use * Ecology. Total number of points in each section multiplied by environmental weighting factor (relative importance)
66
What is a compensation event?
Unexpected event that occurs out of the contractors control and may result in additional costs, time delays or changes to plan
67
Name some examples of compensation events
Changes in laws or regulations Unforeseeable physical conditions (injury) Delay caused by client (site access) Adverse weather Unpredicted ground conditions
68
Who do 'EU Regs apply' to?
Utilities Contracts Regulations (Water, Leccy, Royal Mail) Public Contracts Regulation (Government, Police, Fire)
69
What are the three type of 'EU regs' contracts?
Works contract Services contract Supply contract
70
What are the 'EU Regs' for the tendering process?
Utility/public sector must send out PIN (periodic indicative notice) Utility/public sector employer must 'call for competition' Utility/ public sector must tell tenders how tender will be assessed
71
What are some technical specifications of 'EU Regs'?
Cannot specify items using suppliers name Tech specs must state charecteristics, quality and performance instead Cannot specify item so that only one manufacturer makes it
72
How may a designer be appointed under 'EU Regs'?
Reccomendation Research and interview Open competition Selective competition Exisiting framework agreement
73
What do invitation documents include when appointing designers?
Clients aspirations, budget, progamme Management structure of project Assumptions about procurement method Scope of services provided Collateral warranties Request references Request details and CVs of staff Seek hourly rates for work outside proposed scope
74
What is the difference between Tender and Appointment
Tender = Client - Contractor Appointment = Client - Designer
75
How do clients establish a framework agreement?
Client decides number and extent of frameworks Type of work decided over 5 year period Group similar work into categories Each group advertised in OJEU Tender and contract awarded Appoint contractor for each category
76
What is OJEU?
Official Journal of the European Union Used to publish public sector procurement notices E.g. tenders, contract awards etc. Important for transparency

Construction Management 3 (4 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions