Teamwork, not eBay, is key to value for money
Whilst there are reports that the economy is coming out of recession and in construction some of the bigger firms are reporting that things are less gloomy, it would appear that the supply side of the built environment is still making life difficult for itself.
On the one hand, there was a report in Building magazine that eBay tendering for sub-contracted services is on the increase. It has long been the case that the suppliers of materials are threatened with the proverbial dutch auction, but actual services is taking it to another level.
At Ecobuild a conversation with a builders merchant highlighted another issue – product suppliers undercutting distributors and vendors such as merchants and going direct. It would appear that at every level the construction industry, and to an extent other related disciplines such as FM, are obsessed with short term cost savings forgetting there is nearly always a risk that the bargain is not what they envisaged.
Having worked in built environment media and PR for nearly twenty years now (Alfred McAlpine, Marshalls, Constructing Excellence etc), I have consistently been told that the cheapest price is not always best. Certainly, when it comes to the procurement of actual skills and services, you always pay for what you get. Peanuts, means monkeys (that’s not derogatory to scaffolders by the way) and shoddy work. Doing a deal correctly, discussing the job and exploring options takes time, investment, but in the longer run gets the job done effectively and everyone involved derives value from the process – especially the client. It’s called working as a team.
I’ve talked about team work on behalf of my clients far too often – it might be integrated teams, collaborative working or even partnering – but it means the same thing, working together to make sure the job is done right at a fair price. EBay tendering, dutch auctions offer no guarantees for service. On eBay you at least have the chance to send good back; you can’t do that with a built environment scheme. The only recourse is via the courts.
So, last week we had the BBC complaining about the industry not being capable of meeting its demands. I think that it harsh. If the client discusses clearly what it wants, needs and resists changing the brief, the UK construction industry is definitely able to provide dynamic and inspiring buildings. The obsession with price, blaming everyone else is a symptom of bad client practice made worse by poor advice from consultants (not me of course). I don’t know the details of the BBC contract, but it feels like they might not have embraced the team ethic.
So, eBay is OK for some consumer goods, but not for skilled services. If you’re doing something big, do it right. The way ahead is to work together. As a team.
Tags: BBC, Building, built environment, ebay, teamwork
Absolutely agree. Always tender, check tenders comply with tender documentation and tender to companies of known quality. Observe tender deadlines, make the process formal including carefully checking what is included and excluded from quotation and maybe, just maybe you’ll end up with a well run contract by a contractor who can deliver quality.
Lowest price, especially unexpectedly low, can mean something is missed (I have seen pricing which has missed a complete page of the tender documantation for example).
Check against your experience too, as you should have some idea of what the right cost level is, and underpricing can mean constant applications for variations and extra cost, never mind the additional management time.
I can’t imagine the BBC being a good client – like most civil servant run contracts where the money pot is bottomless, they will feel unconstrained by budget and will probably change the spec frequently.
Good Blog
Hi Andrew,
Thanks for writing this. The BBC story is a good example of the press being used to fight a battle which should never have been waged. The Broadcasting House project went astray and what we have been seeing the after effects – a desperate scrabble to blame someone, anyone else.
If you want a good building, you _have_ to have everyone on board. One might say that the procurement processes we commonly use today encourage an adversarial approach, but whatever we work with, it has to consider the needs of all participants. The client may need cost certainty in advance or he may want to change his mind, but he can’t have both. The contractor needs to plan his workforce and subcontractor use and make a reasonable profit, but he must deliver. Client, Contractor and Consultants all have needs and responsibilities and only good Contract Administration with everyone’s needs addressed will produce a quality building at a reasonable price.