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Management Assignment: New Campus Project Of CQU

Question

Task:

  1. Critically analyse and advise on the most suitable procurement route on the case study. The case study contains different sub-projects. You will be also developing project budgets based on the data given. You will be given the characteristics of the client, project limitations and conditions and available resources for each sub project.
  2. You need to justify your procurement route and explain why it is suitable to make the projects successful to better achieve the quality, time and cost of this project. You may need to explain why not other routes were selected.
  3. Advise on the best suitable contractual agreements for parties involved to compliment the procurement option.
  4. If you were to propose a contract type, discuss the risks associated and the key components that must be covered in selected contract
  5. Estimate the required budget (s) the sub- projects
  6. As a procurement manager and in light of this case, you need to highlight your main concessions to perform purchase process of the assigned resources
  7. Your report should include thorough analysis with supporting evidences and discussion.

Answer

Introduction
One of the most important aspects that one notices before investing in any business or project is whether the outcomes are worthy and profitable or not. The procurement plans and the styles that the contemporary world is aware of are highly significant in understanding the right and most suitable styles that large projects need to pursue for better and positive outcomes. it must be noted that the procurement plans are being modified and channeled according to demands and wishes that come from various stakeholders and market researchers.

The Central Queensland University (CQU) decided to construct a large project that is becoming their new campus in Melbourne. This Management Assignment requires proper suggestions and advice in terms of bringing the most profitable outcomes. This particular Management Assignment, in the content hereafter, is going to suggest a few procurement plans that will benefit the new campus project of Central Queensland University (CQU). This Management Assignment aims to select the best plan and suggest the best practices based on the same,

Discussion
Report to address different routes and comparing them
Explaining each route in details (how does it work): According to scholars, there are a few procurement routes and strategies that can help in developing a project without any risks and issues. However, it is also true that every procurement plan does not define success and it is the duty of the project manager to attain proper knowledge in understanding the best and most suitable procurement plan for any project. There are primarily four main procurement routes that are suggested by project developers or consultants for successful completion of any project. These are – the traditional procurement plan, the Design and Build procurement plan, the management construction or the construction management procurement plan, and the procurement route of collaborative working. The following section in this Management Assignment is going to examine each of the four routes and understand the best route that has to be suggested to the Central Queensland University (CQU) project at Melbourne.

  • The traditional procurement plan/ Design–bid–build – Popularly known as the Design–bid–build method, this is a traditional procurement plan where the actions are taken in phases and the entire project goes through a series of three particular strands or phases ("Design and build procurement route - Designing Buildings Wiki", 2019). These phases are termed as- the design phase, the bidding phase and the construction phase. The project is first handed to the designer by the contractor. The designer can be the engineer or any technician that will develop an understanding on the best type of the designs to suit the needs of the project. Then bidders or the various contractors who take part in the bid collect the necessary documents and pass them on to sub contractors that look after the supply chain etc. This is the phase when it is decided that who is going to do what in the project.
  • The Design and Build procurement plan- In this type of the procurement style, the same contractor builds and designs the construction, unlike the traditional way of doing the project that is discussed in the previous section ("Procurement routes in the contemporary system", 2019). The design and build procurement style is done by often paying the whole amount of money to the prime contractor and the contractor is responsible in all kinds of risks and managing the supply chain.
  • The procurement route of the management construction- In this type of procurement style the management contractor is responsible for managing the works and other contractors while the owner of the whole project has some control over them as well.
  • The procurement route of collaborative working- These types of procurement plans are suggested in large scale project cases where a long term relationship is there in framework agreements and partnerships ("What are the main types of procurement in the construction industry?", 2019). These kinds of procurement plans are not preferred to complete single or small projects. They are primarily given to the projects that are large scale and require a very long time to complete.

Critically examining on what are its advantages/disadvantages of each
The traditional procurement plan/ Design–bid–build
Advantages

  • This particular procurement plans ensures great quality of outcomes
  • It is also good in its flexible approach and brings variations
  • The designs are controlled by architects and contract administrative teams
  • It also brings cost profits if carefully put into practice

Disadvantages

  • There may arise a large amount of expenses if careful and strategic methods are not being pursued
  • A lot of time can be taken as the whole project passes through three phases and require a lot of stakeholders to commit time.

It can be stated that in relation to CQU this particular route can be unpredictable strategy that can either be profitable or bring massive loss. As the organization has no experience of opting for procurement plans or such constructions, this plan may also bring risks in the sphere of bidders’ selection; it can take time, and also create issues in the monetary transactions. Hence, a high level of risk prevails.

The Design and Build procurement plan
Advantages

  • it provides sharp and fast construction processes
  • it saves time
  • it is beneficial in terms of costing and financial expenses
  • there is a single point of responsibility- the design and the constructor responsibility- hence less fuss and hassle ("Procurement route options pros and cons - Designing Buildings Wiki", 2019)
  • it is very easy to bring changes in the plan of this procurement route
  • the client stays in low risks
  • the variations are mostly valued and the quality is also up to the mark due to swift work from design to construction in the shortest period of time

Disadvantages

  • there can be compromises in the build quality as the route takes the shortest and fastest procedure of completing the project ("Procurement route options pros and cons - Designing Buildings Wiki", 2019)
  • the contractor often creates risks for the construction
  • the design flexibility is not much strong and easy to pursue

It must be noted that the campus project has a stipulated amount of money that is to be spent. Also the authority has no prior experience of channeling such a work. In relation to that it can be stated that there are certainly some risks in opting for this route. However, these risks can easily be combated and eradicated by construction strategies and best practices at work. It must be noted that this particular route is fast and also offers good quality. These are necessary for the campus project. Hence, this route is more preferred than the previous route of traditional procurement and is less risky.

The procurement route of the management construction
Advantages

  • the sub contractors are good stakeholders to look after the best supplies and other departments
  • the process of competitive tender promises good results
  • there are specialists who are appointed to add quality to the whole project and each operation
  • there is design flexibility

Disadvantages

  • this route is highly dangerous for inexperienced clients
  • costs in this route during construction are highly tight and may fall short
  • there be many issues that can come through this route
  • a lot of times there is a lack of specialists and advisors for successful completion of the project

The procurement route of collaborative working
Advantages

  • it is very much possible to overlap designs during the construction process
  • It is really good for big projects that are dine in groups
  • There are specialists who look after the designs and other departments of the construction
  • It is a very good for inexperienced clients
  • It is great to promote and make all types of buildings
  • The risks are low for all time/ first time users

Disadvantages

  • Sometimes the relationships between the stakeholders can become too comfortable and there are lack of motivation and development opportunities that can arrive ("Procurement route options pros and cons - Designing Buildings Wiki", 2019)
  • This is not a suitable route for small constructions
  • Most of the companies and contractors are restricted in using this route as it is best for large scale constructions

Critically understanding the reason for choosing the best route
After examining the current situation of the Central Queensland University (CQU) and their plan to make the construction in the forty acres of land in Melbourne, it is suggested that the university must opt for the Design and Build procurement plan. Also commonly known as the DB route of construction procurement, this particular plan will suit the requirements of the Central Queensland University (CQU) the most.

  • Time- in terms of time, this particular plan will finish the work within the stipulated time limit of 2020.
  • Cost- money is important and this particular plan will involve contractors and the designers who are going to set the right prices for the quality based products
  • Quality (level of service)- maintaining the best quality is one of the pros of this route. It must be noted that the designers or the architects will assure best design quality and also the contractors will also look after the process that will also involve specialists and experts.
  • Changing orders- flexibility is one of the merits of this particular route. Hence it is most suitable
  • Claims- claims from stakeholders can arise, but they can be negotiated in time and the contractor will be responsible for that.
  • Risk- low risk is another merit of this route. It is preferred to those who value time and want to avoid risks.
  • Management capacity and ability/experience- the contractor and other designers, architects and everyone will be highly skilled and experienced. They are thus experienced in managing and problem solving at the sites.
  • Responsibility and other issues- the contractor will be appointed at the very initial stage of the project and most of the responsibility will be carried out by him.

Understanding the advantages of this route over other routes (traditional/non-traditional)
Explaining the advantages and disadvantages of the recommended route: The route selected for the Central Queensland University (CQU) project is the build design procurement route.

  • Advantages – it is very suitable for first time procurement planners and also has low risks of losing on money. The best part is that this particular route takes shortest amount of time in finishing the work ("Design and Build vs.Traditional Procurement | Analysis & Comparison", 2019). It also has designers and the contractors who are very experienced in understanding the work and sharing responsibilities.
  • Disadvantages – One significant con for this route is that the fast time and the quack work often compromises on the design quality and specifications. However, proper measures can mitigate this issue.

This route is the best for the Central Queensland University (CQU) because it will finish the work in time. It will be less risky in losing on money. Also the experienced architects and designers will help in making the quality of the design and buildings perfect.

Understanding the potential risks associated with this selected route for both the owner and the contractor
As discussed earlier in the Management Assignment, the only risk that is related to this procurement plan is the risk of compromising on the design quality. It must be noted that risk only occurs if the designers and the contractors are not fully equipped with all resources to finish the project in time. In order to reach the deadlines and finish the project in time- which is a great part of this plan and is also wanted by the Central Queensland University (CQU) - this project can take strategies and take time initially to allocate the job requirements and proceeds with ease and best quality design outputs. The owner’s risk would be to lose n the quality ("Route 3 - Develop Strategy - Procurement Route - Innovation Partnership | Procurement Journey", 2019). The contractor’s risk will be related to the same as it will not be able to satisfy the stakeholder or the designer’s designers.

How does this route will satisfy the main points (Cost, time, and Quality).
A simple methodology has to be followed that will allow the particular chosen route to work with its full potential and bring out the best practices in order to successfully complete the project of Central Queensland University (CQU). It must be noted that the contractor has to be appointed alongside the best architect and designer who are going to look carefully into the project first. After a few meetings the contractor can start appointed other stakeholders and the designer will start working on eth building designs and specifications. Both the contractor and designer needs to work hand in hand and suit the requirements of the Central Queensland University (CQU). The client who is the Central Queensland University (CQU) here can also hire other experts and designers who can work collectively with the prime contractor and plan. A lot of work has to be done by the contractor in recruiting the best employees and mist skilled workers for which the client needs to give support and liberty to the contractor.

  • Cost – In terms of cost, the client is going to pay a fixed and lump sum amount to the contractor and the designer. This amount will be sufficient for the whole task and the costs will not increase and that risk is low in this plan of procurement. The Central Queensland University (CQU) will not pay anything extra once the plan is fixed and the work starts to proceed to completion.
  • Time – Finishing the work within time is one of the requirements of the client, hence this procurement route is going to do that. Finishing the project at quicker rates is one of the specialties of this procurement routes.
  • Quality – the designers who will be hired to work and make designs are all the experienced and skilled architects. They are going to consult the client, also the contractor in designing and fixing specifications for all buildings. Hence the quality of the project will be up to the mark.

Select the best contract type for this project
In relation to the project the client is required to pay the lump sum amount as the deal or the contract to the contractor. It is needed to note that the client Central Queensland University (CQU) wants to finish the whole project by the starting of the next year, 2020, hence the project needs to be started and finished at the shortest amount of time. In order to do this, the lump sum contract will enable to the contractor and the designer to get the money and start working on the project. It is thus recommended in this Management Assignment that the client must go for the lump sum contract. However, there is a risk that might take place if the contractor runs short of money and needs extra payments to fulfill the objectives of the project. In that case the client needs to provide more money and violate the contract.

Considering this risk, it can be stated as the disadvantage of the project and it surely needs to get analyzed well before starting the project. Also, the advantage of this particular contract is that the stakeholders will be able to understand the money is being allocated and that they will surely receive the money. Less chances of trust issues or fraud is there in the lump sum contract deals ("Lump Sum Construction Contract - Advantages and Disadvantages", 2019). The process of the lump sum contract will allow the contractor to take full responsibility of finishing the work at the highest quality as the prices are fixed and taken already. Moreover, in relation to the case of the Central Queensland University (CQU) it is very flexible to bring changes and supervise a lump sum contract and thus it will be perfect for this project. It must be noted that payments are done in fixed amounts after each objective of the project is fulfilled. This enables the contractor in maintaining the best possible quality to satisfy the client’s preferences and thus it will be the best quality work within the shortest amount of time.

Conclusion
This Management Assignment has been highly educational in looking at the various procurement plans and processes. the report has focused on the case study of the Central Queensland University (CQU) and has develop a solid understanding on the best use of the procurement plans to finish a project with the best outcomes. Good knowledge on types of project procurement routes has also been achieved through this project. Management assignments are being prepared by our management homework help experts from top universities which let us to provide you a reliable online assignment help service.

Reference / bibliography list
Ashworth, A., & Perera, S. (2018). Contractual procedures in the construction industry. Routledge.

Brook, M. (2016). Estimating and tendering for construction work. Routledge.

Challender, J., Farrell, P., & McDermott, P. (2019). Building Collaborative Trust in Construction Procurement Strategies. John Wiley & Sons.

Design and build procurement route - Designing Buildings Wiki. (2019). Retrieved from https://www.designingbuildings.co.uk/wiki/Design_and_build_procurement_route

Design and Build vs.Traditional Procurement | Analysis & Comparison. (2019). Retrieved from https://www.oktra.co.uk/insights/design-and-build-vs-traditional/

Lump Sum Construction Contract - Advantages and Disadvantages. (2019). Retrieved from https://theconstructor.org/construction/lump-sum-construction-contract-advantages-disadvantages/14956/

Marsh, P. (2017). Contracting for engineering and construction projects. Routledge.

Naoum, S. G., & Egbu, C. (2016). Modern selection criteria for procurement methods in construction: A state-of-the-art literature review and a survey. International Journal of Managing Projects in Business, 9(2), 309-336.

Procurement route options pros and cons - Designing Buildings Wiki. (2019). Retrieved from https://www.designingbuildings.co.uk/wiki/Procurement_route_options_pros_and_cons#Traditional_contract

Procurement Routes in Public Building and Construction Projects | Journal of Construction Engineering and Management | Vol 132, No 7. (2019). Retrieved from https://ascelibrary.org/doi/abs/10.1061/%28ASCE%290733-9364%282006%29132%3A7%28689%29

Procurement routes in the contemporary system. (2019). Retrieved from http://www.chantier.net/europe/europe/fasc2/a11_07.htm

Rahmani, F., Maqsood, T., & Khalfan, M. (2017). An overview of construction procurement methods in Australia. Engineering, Construction and Architectural Management, 24(4), 593-609.

Route 3 - Develop Strategy - Procurement Route - Innovation Partnership | Procurement Journey. (2019). Retrieved from https://www.procurementjourney.scot/route-3/route-3-develop-strategy-procurement-route-innovation-partnership

Route 3 - Develop Strategy - Procurement Route - Innovation Partnership | Procurement Journey. (2019). Retrieved from https://www.procurementjourney.scot/route-3/route-3-develop-strategy-procurement-route-innovation-partnership

Route 3 - Develop Strategy - Procurement Route - Innovation Partnership | Procurement Journey. (2019). Retrieved from https://www.procurementjourney.scot/route-3/route-3-develop-strategy-procurement-route-innovation-partnership

What are the main types of procurement in the construction industry?. (2019). Retrieved from http://www.buildup.eu/en/learn/ask-the-experts/what-are-main-types-procurement-construction-industry

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