3 projek utama gagal kerana kronisme

harakahdaily

KUALA LUMPUR, 20 Okt: Ahli Parlimen Pakatan Rakyat mendakwa Perdana Menteri, Datuk Seri Najib Razak tidak melaksanakan transformasi ekonomi seperti yang diwar-warkan sebaliknya masih mengamalkan kronisme dan rasuah dalam pentadbiran.

Ini terbukti dengan pendedahan ahli Parlimen Pakatan Rakyat mengenai tiga projek yang mengalami kegagalan dalam kepada kroni Umno BN mengaut keuntungan.

Tiga projek berkenaan ialah pembinaan Hospital Shah Alam, Institut Kanser Negara dan pembinaan Lebuh Raya Pantai Timur (LPT) 2 dari Jabor ke Gemuruh, Terengganu.

Ahli Parlimen Shah Alam, Khalid Samad yang sebelum ini mendedahkan mengenai penyelewengan dalam projek berkenaan memberitahu, Umno BN masih menyerahkan pembinaan hospital itu kepada syarikat kroni walaupun subkontraktor sedia ada, GM Health Sdn Bhd bersedia memberikan diskaun RM3 juta serta menjamin hospital disiapkan dalam tempoh yang lebih awal.

"Ini adalah kontraktor Bumiputera kelas A tetapi ditamatkan kontraknya oleh kontraktor utama, Sunshine Fleet kerana pertikaian berhubung pembayaran progresif. Lalu GM Health menawarkan kepada kerajaan untuk meneruskan projek ini dengan diskaun RM3 juta dan sanggup menyiapkan projek dalam tempoh 18 bulan.

"Walaupun syarikat itu telah membayar komisen kepada Sunshine Fleet tetapi ia masih sanggup untuk meneruskan projek tersebut," kata beliau dalam satu sidang media di lobi Parlimen hari ini.

Sementara itu, Saifuddin Nasution (PKR-Machang) pula mendedahkan, kos pembinaan Institut Kanser Negara meningkat dua kali ganda daripada tawaran asal RM340 juta kepada RM690 juta.

Ini berlaku kerana Umno BN masih mengamalkan budaya kronisme dan 'untung atas angin' (rent seeking) walaupun menjanjikan kepada rakyat pendekatan tender secara terbuka akan diamalkan dalam Model Ekonomi Baru.

Menurut Saifuddin, acara pecah tanah telah dilakukan oleh Perdana Menteri, Tun Abdullah Ahmad Badawi pada 9 Januari 2007 di Putrajaya dan menjadi sebahagian daripada projek dalam Rancangan Malaysia Ke-9.

Projek tersebut yang merupakan inisiatif kerajaan untuk pesakit kanser dijangka siap dalam tempoh 30 bulan.

"Pada 10 Mac 2009, Timbalan Menteri Kesihatan pada waktu itu, Datuk Dr Latiff Ahmad menyebut kerajaan berada di tahap akhir untuk membina institut tersebut dengan kos sebanyak RM700 juta.

"Ertinya, selepas 24 bulan diumumkan, harganya sudah pun meningkat 100%," ujar beliau.

Menurut Saifuddin, pihaknya telah melakukan siasatan dan mendapati projek itu telah diberikan kepada Kiara Teratai Sdn Bhd dan dalam penyata akaun tahunan syarikat tersebut pada tahun 2009 mengesahkan ia telah memperolehi surat tawaran untuk membina institut pada Januari 2008.

Satu lagi projek yang menjadi mangsa salah laku Umno BN iaitu pembinaan Lebuh raya Pantai Timur (LPT) 2 apabila dua pakej projek pembinaan bernilai RM59.2 juta gagal disiapkan oleh sebuah syarikat yang dimiliki oleh seorang ahli jawatankuasa Umno Hulu Terengganu.

Abdul Wahid Endut (PAS-Kuala Terengganu) dalam sidang media sama berkata, syarikat kepunyaaan kroni Umno itu hanya menyiapkan 15.1 peratus sahaja Pakej 9B yang diberi dalam tempoh lebih dua tahun sejak 2007.

"Apa yang syarikat ini berminat ialah menebang semua balak di dalam kawasan pembinaan lebuh raya itu dan menjualnya untuk keuntungan mereka.

"Apabila projek terbengkalai kerajaan sekali lagi membuka tender dan serahkan kepada satu lagi syarikat kroni dengan kenaikan kos pembinaan sebanyak 20 peratus," kata Abdul Wahid

Tambah beliau, sehingga Jun LPT2 yang bermula dari Jabor di Terengganu hingga Temerloh di Pahang hanya siap 70.4 peratus berbanding 82 peratus dalam perancangan awal.

"Sebab lambat ialah kerana kerajaan memberi projek secara rundingan terus dan kemudiannya syarikat berkenaan meninggalkan projek,” ujarnya.

Katanya, LPT2 membabitkan kos yang tinggi iaitu RM3.7 bilion dan lebih 50 peratus kosnya datang daripada dana khas negeri Terengganu.

Projek itu, ujarnya mempunyai 17 pakej dan dua daripadanya diberi kepada sebuah syarikat, Arah Jitu Sdn Bhd milik AJK Umno Hulu Terengganu.

“Beliau diberi Pakej 9B dan Pakej 8. Di Terengganu, Umno selalu beri projek kepada OKU, bukan orang kurang upaya tapi 'Orang Kuat Umno'," ujar beliau.

Ulasan: Demikianlah cara UMNO mengaut duit rakyat.

http://www.harakahdaily.net/v2/index.php?option=com_content&view=article&id=29108:3-projek-utama-gagal-kerana-kronisme&catid=1:utama&Itemid=50

Measured Term Maintenance Contract

Basis

A method of contracting used where there is much repetition of work, for example in the case of regular or planned preventive maintenance work is required, e.g. Housing, Schools, etc.

Tenders are sought on the basis of a Schedule of Rates, chosen for their applicability to the proposed work. Tenderers quote either their price for each work item, or where the Schedule of rates are a standard priced document, on the basis of a ‘plus or minus’ rate in each case. Additionally the tenderer will likely be asked to quote his minimum charge, or call out rate.

Contracts are generally let on a ‘Framework’ basis, generally for a period of between 2 and 3 years, although longer periods can be agreed and the contract often incorporates a means by which the contract can be extended for a further period of time, perhaps one or two years as an incentive for the contractor to perform. In this respect clients often define KPI’s (Key Performance Indicators) as part of the contract in order to provide measurement of the performance of the contractor.

After the contract commences, the Contractor measures the works carried out and raises invoices against the Schedule of Rates for each separate job. Applications for payment are based upon a monthly schedule and application for payment. Invoices are generally payable on completion of the service and monthly in arrears.

Additionally there can also be an additional annual sum per property for reactive repairs; and a further schedule of rates for renewals rather than repairs as applicable.

Payments for the reactive repairs element can be allowed to be adjusted down for any system down time or unavailability during the contract period.

Often used for repairs, maintenance, renewals and minor works by councils and other public authorities with major estate portfolios.

Advantages

· Creates a long-term integrated multi-party partnering approach between the client’s estate management team and the chosen contractor, to provide better communication and response.

· Allows the development of more open pricing over the life of the term programme

· Allows proactive change and risk management, including use of a risk register.

· Creates a supply chain partnering environment whereby problem solving and alternative dispute resolution can thrive.

· Provides process for continuous improvement by allowing the measurement of improvement and related incentives which may be incorporated into the contract terms

· Certainty of cost for each work task and can be verified and easily audited.

· Can incorporate Design and Build and Performance Specified works if required

Disadvantages

· Some clients believe that an open book agreement with a contractor may be a more economic way to proceed.

· Minimum charges can cause a feeling of mistrust between the client and contractor, where an apparently large number of ‘small’ charge jobs are carried out.

· A change in personnel may bring conflict and when things go wrong, there can be a serious breakdown between the parties.

Suitability

Works well where there is a high degree of repetition in the works, for example the renewal of locks, painting, replacement of glazing, plant repairs, which can be reasonably foreseen.

http://www.kerncm.com/MsdTerm.aspx

Cost Reimbursable or Prime Cost

Basis

The contractor is appointed, possibly in competition, but on many occasions by negotiation, to carry out the works on the basis that he is paid his actual costs. He also receives a fixed fee or percentage for overheads and profit, which if competitive tendering is possible, can form the basis of the tender.

Some practitioners argue that this procurement method can be likened to being on a time and materials basis, or otherwise ‘Daywork’; albeit with modified terms.

Advantages

· Enables a very early start to be made on site, but at the expense of cost certainty.

Disadvantages

· Overall cost control can be difficult because the contractor does not have any great incentive to work efficiently. Although interim assessments can be made, the total cost is not known until the work is largely completed.

· There is often no means to ensure that errors and bad workmanship are borne by the contractor and sub-contracted works, particularly if all works are let on a prime cost ‘style’ basis. It is for this reason that in many cases sub-contract packages are let on a competitive lump sum basis in order to maintain a deal of cost control. Additionally it may be a term of the tender that a reduction in the costs is made to cover such abortive work. Similarly, it is normal to restrict head office staff costs such that a proportion of these are included in the fixed fee; and to agree a schedule of site staff and site establishment costs in order to create some level of cost certainty.

· The risk for unforeseen circumstances generally lies with the client.

Suitability

Probably a last resort method of procurement in view of the uncertainty of total cost inherent in the process. Really only suitable for projects where an immediate start on site is required, for example where fire damage or terrorist damage has occurred, or perhaps with difficult refurbishments where the scope of work cannot be established until the work progresses.

http://www.kerncm.com/PrimeCost.aspx

Construction Management

Basis

The original philosophy of Construction Management was that the client would organise the management of the construction activities in-house. As with Management Contracting, the actual works are divided into separate trade packages that are tendered by trade contractors. However, the major difference from management contracting is that the client employs the selected trade contractors direct.

Because of the criticism of Management Contracting that has arisen over the past few years, the Construction Management approach has become more widely applied.

Not all clients have the facility to manage their own construction work in-house and it is now normal for an outside construction manager to be appointed - either an independent consultant, or a contractor. In these cases the trade contracts are still direct with the client.

Advantages

· Enables an early start to be made on site before design is well advanced.

· Allows flexibility for change as the works are tendered progressively. There is a reduced likelihood of claims affecting other packages in the event that major changes are made.

· Lends itself well to complex construction projects as construction can commence before design work is completed.

· Direct contracts between the works contractors and the client should result in stronger relationships and potentially a less adversarial situation.

· Trade Packages can include design where specialist works are required and are let on a Design and Build basis.

· The client has a greater degree of control over the works contractors.

· Can incorporate Design and Build and Performance Specified works if required

Disadvantages

· As no contract sum is established, the client relies upon the Quantity Surveyor's estimate. This is, however, endorsed by the construction manager initially and firm costs are established progressively during the course of the works.

· Organisation costs such as site accommodation, telephones, copying etc., are likely to be paid on a prime cost basis. This gives the client less cost certainty.

· The client accepts a greater degree of risk because he has financial responsibility for the default of the works contractors.

· The client takes on the burden of dealing with additional correspondence, multiple payments and possibly adjudication on disputes and extensions of time, etc., for all individual trade contractors.

Suitability

Appropriate for large, complex projects where the client is experienced in the construction process, wishes to have a "hands on" approach and where an earlier start is required than can be made by proceeding with the full design process and tendering in a more traditional way. This is achieved by overlapping design, preparation of tender documents and construction.

http://www.kerncm.com/ConstrMgmt.aspx

Design, Manage and Construct

Basis

The Design, Manage and Construct route is a hybrid route between Design and Build and Management Contracting.

Like Management Contracting, the Design, Manage and Construct contractor is appointed to manage the construction of the project through a series of trade-contracts. It differs, in that the contractor is also given responsibility for programming and procuring the design information, so that the design consultants are employed by the ‘design and manage’ contractor, rather than the client.

The Design, Manage and Construct contractor is selected, usually in competition, early in the programme on the basis of a response to a set of tender enquiry documents which requires the contractor to tender a fee for:

· pre-commencement services;

· construction services during and after the project;

· a lump sum for site staffing and facilities, etc

As well as price, the required performance of the design and manage contractor is a major factor in the selection process.

For the actual building process, the works are divided into separate trade packages, for which tenders are sought from trade-contractors by means of a variety of tender routes, vut by preference on a lump sum basis. The selected trade-contractors are taken on by the design and manage contractor.

AAdvantages

· Gives single point responsibility.

· Enables an early start to be made on site before the design is completed.

· Creates a flexible tendering environment. Allows for ongoing change because works are tendered progressively. In turn this reduces the ongoing likelihood of claims being made by the trade-contractors, should significant changes be made.

· The ‘Design, Manage and Construct’ method lends itself well to complex or fast track construction because construction work is able to be started before the design is finished.

· Leads to a less confrontational relationship between the Design and Manage contractor and the client.

· Management of the design information production by the design and manage contractor has the potential to lead to fewer delays arising from lack of information.

· In most cases the Design and Manage contractor adopts overall financial responsibility for the default of sub-contractors.

Disadvantages

· Can lead to duplication of resources between trade-contractors and the Design and Manage contractor and therefore can also lead to a higher level of tenders.

· No contract sum is established. Therefore the client relies upon the Quantity Surveyor's estimate, endorsed by the Design and Manage contractor initially and then progressively firmed up as tendering progresses during the course of works.

· There is an ‘arms-length’ relationship between the client and the contractor’s design team, which can potentially lead to lower client satisfaction with the final design.

Suitability

Appropriate for large, complex projects or fast track projects where potentially an early start is required and where the client wishes to have a single point responsibility.

http://www.kerncm.com/DesManageandConst.aspx

Target Cost Design and Build

Basis

As with traditional Design and Build, a contractor is selected, normally in competition, to Design and Build the building. Tenders are invited on the basis of an "Employer's
Requirements" which sets out the specification of the building required and defines the planning and other restrictions. The contractor is responsible for the design team, although the client should retain the services of consultants to protect his interests and act on his behalf.

The contractor's costs are audited by the Quantity Surveyor and the contractor is paid the actual cost of the work so long as it is less than the tendered Target Cost. In addition, any saving on the Target Cost Design and Build tender sum is split, normally 50/50 (but can be varied) between the contractor and the client.

Like Design and Build a form of "Develop then Design and Build" can be adopted with Target Cost Design and Build. However because of the inherent sharing of savings the potential for such economies being made is reduced and unlikely to be as attractive to the contractor.

Advantages

• Establishes the client's maximum financial commitment (subject to client variations). If the contractor's costs exceed the Target Cost, only the Target Cost sum is paid.

• Leaves responsibility with the contractor for organising and programming the design team's activities. The client is therefore not responsible for extensions of time in the event that design information is not produced on time.

• Variations are normally pre-agreed and the client has the opportunity to instruct or otherwise knowing the consequences in terms of cost and time.

• Gives single point responsibility.

• Leads to a less adversarial attitude between contractor and client as both benefit from savings.

• Can give prior warning of future financial problems as the Quantity Surveyor has complete access to the contractor's actual costs.

• The risk for unforeseen circumstances is shared more equitably between the client and the contractor.

Disadvantages

• Provides the client with arguably a less sophisticated building in terms of design detailing then would be the case with other forms of procurement.

• Gives less control over the work in total and of the costs of any variations required.

• Can be difficult in certain instances to precisely define the standards and quality of design required.

Suitability

Appropriate for contracts where the client requires a firm lump sum price but where risks are likely to be priced by the contractor in the tender. Probably appropriate for less sophisticated buildings where the standards and quality can be easily defined.

http://www.kerncm.com/TargetDandB.aspx

Design and Build

Basis

A contractor is selected, normally in competition, to Design and Build the project. Tenders are invited on the basis of an "Employer's Requirements" document prepared normally by the client or his consultants. The Employers Requirements set out the project needs in terms specification, function and performance of the building required and if applicable will also define planning and any other restrictions.

The contractor responds with a set of “Contractor’s Proposals” upon which the tender bids are assessed. Assuming the Contractors Proposals fulfil the employer’s requirements, the lowest bid is often accepted, but this may not be the case because subjective consideration of the overall design and quality of the proposals may be important than cost alone.

Once appointed the contractor employs and is therefore responsible for the design team.

It should be noted that under a JCT form of Design and Build contract, the Employer, unless he/she appoints somebody else, becomes the “Employer’s Agent”. In the JCT contract this person is assumed to be non-technical and could be the only named party apart from the Contractor – there is normally no quantity surveyor. In most cases the client would be advised to retain the services of his own consultants including a quantity surveyor to protect his interests and act on his behalf.

In many cases nowadays and particularly where the project is of a complex nature or facing difficult town planning procedures, the client often appoints a design team to negotiate planning, prepare preliminary designs and specifications and a detailed design brief before seeking Design and Build proposals from contractors – this is referred to by clients as "Develop then Design and Build”, or by contractors colloquially as “Design and Dump”.

Develop then Design and Build ensures that the client gets a design that works for him and the risk of the final design and construction works is assumed by the contractor. the contractor. In some instances and where the employer agrees or requires it, the initial design team can be novated to the contractor.

Design and Build Advantages

· Establishes a fixed lump sum price, subject only to client's required changes

· Leaves responsibility with the contractor for organising and programming the design team's activities. The client is therefore not responsible for extensions of time in the event that design information is not produced on time.

· Variations (known as Changes) are normally pre-agreed and the client has the opportunity to instruct or otherwise, knowing the full consequences in terms of cost and time.

· The risk for unforeseen circumstances lies with the contractor.

· Gives single point responsibility.

Disadvantages

· Provides the client with arguably a less sophisticated building in terms of design detailing than would be the case with other forms of procurement.

· Gives less control over the work in total and of the costs of any variations required.

· Can be difficult in certain instances to precisely define the standards and quality of design required.

· Depending on the risks imposed on the contractor at tender stage can result in a higher contract value than would otherwise be the case.

Suitability

Appropriate where the client requires a firm lump sum price and where the required standards and quality can be easily defined before tenders are sought.
For more control over quality and cost, this procurement route can be used in a "Develop then Design and Build" form where the client's design team initially negotiates and obtains planning permission, prepares outline designs, specifications and a detailed brief for the Employer’s Requirements, particularly where more complex buildings are required under this procurement method. In some cases the employer’s design team is required to be novated to the contractor after obtaining planning permission.

http://www.kerncm.com/DandB.aspx

Management Contracting

Basis

The philosophy of Management Contracting differs from that of other more traditional procurement methods in that the management contractor is appointed to manage the construction of the project rather than build it.

The contractor is selected, normally in competition, early in the programme on the basis of a response to a tender enquiry document. This requires the contractor to tender a fee for pre-commencement services and construction services during and after the project as well as a lump sum or guaranteed maximum for site staffing and facilities, etc. As well as price, the required performance of the management contractor is a major factor in the selection process.

For the actual building process the works are divided into separate trade packages which are tendered by trade contractors. The selected trade-contractors are taken on by the management contractor who is responsible for managing them and in particular their ability to meet quality and programme targets.

Advantages

· Enables an early start to be made on site before design is well advanced.

· Allows flexibility for change as the works are tendered progressively. There is a reduced likelihood of claims affecting other packages in the event that major changes are made.

· Lends itself well to complex construction projects as construction can commence before design work is completed. It is important, however, that the design of each trade package is complete at the time of tendering that package.

· Leads to a less adversarial relationship between management contractor and client.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· Can lead to duplication of resources between trade-contractors and the management contractor and therefore higher tenders than would be the case under a more traditional route.

· As no contract sum is established, the client relies upon the Quantity Surveyor's estimate. This is, however, endorsed by the management contractor initially and subsequently firm costs are established progressively during the course of the works.

· The client accepts a greater degree of risk because he has financial responsibility for the default of sub-contractors.

Suitability

Appropriate for large, complex projects where an earlier start is required than can be made by proceeding with the full design process and tendering by a more traditional route. This is achieved by overlapping design, preparation of tender documents and construction.

http://www.kerncm.com/MgmtCont.aspx

Target Cost Contracts

Basis

A contractor is appointed, either in competition or by negotiation, on the basis of pricing of simplified Bills of Quantities or a Schedule of Works. The tender price forms the Target Cost but the contractor is paid the actual costs for executing the work, as audited by the quantity surveyor, so long as this is less than the tendered Target Cost.

The Target Cost is, in effect, a ‘Guaranteed Maximum’. Any saving on the Target Cost is split, normally 50/50 (but can be varied) between the contractor and the client.

Advantages

· Enables an early start to be made on site as the tender documents can be prepared and a contractor appointed before the full design is completed.

· Establishes the client's maximum financial commitment (subject to client variations). If the contractor's costs exceed the Target Cost, only the Target Cost sum is paid.

· Gives the opportunity for the client to benefit from any savings made by the contractor. It is particularly useful in cases where risks may be priced in the tender, as under this system if those risks do not materialise the saving is shared.

· Leads to a less adversarial attitude between contractor and client with both benefiting from savings made.

· Can give early warning of future financial problems as the auditing quantity surveyor has complete access to the contractor's actual costs.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· The contractor and design team need to fully understand the Target Cost process.

· Can prove marginally more expensive than a more traditional contract where more risk is taken by the contractor.

Suitability

Appropriate for projects where an early start is required on site, and where the client wants to establish a maximum financial commitment, together with a less adversarial relationship.

Schedules of Work

Basis

A Schedule of Works document lists all of the main sections and heads of work to be undertaken by the contractor.

A lump sum tender price based upon the priced Schedule of Works and associated documents are normally tendered in competition by a pre-selected list of between three and six contractors.

The Schedule of Works must be read in conjunction with the specification and the drawings and is required to be priced by the tenderer on a lump sum basis. Normally if given, quantities of work are for guidance only and the contractor is required to make his own measurements in order to prepare his tender bid.

Often in addition to the Schedule of Works, the contractor is requested to price a ‘unitary’ schedule of rates relating to the principal items of material, etc to be carried out. This can assist in the valuation of variations that may be later instructed.

Provisional sum items in the Schedule of Works can be included where these can be defined. Additionally and as with Bills of Quantity, Provisional allowances for undefined and defined works can be included and if required. Also allowances for works to be carried out by ‘named’ specialist sub-contractors can be included and if required can then be tendered separately – although this is relatively uncommon today and it is more likely that such work will be part of the main contractor’s tender by means of his selection from list of ‘preferred sub-contractors’ to be employed as ‘Domestic sub-contractors’.

However, it is important to note that because a Schedule of Works does not refer to a set of Measurement Rules, the documents must set out the basis (or rules) upon which Provisional Sums are included. Additionally and similarly definitions for General Attendances and Special Attendances to be included in connection with specialist sub-contractors must also be defined in the tender/contract documents.

This method of procurement became popular after the introduction of the JCT Intermediate Form of Contract in 1984. It continues to be popular today.

Advantages

· The lump sum price is firm, subject only to variations which may be instructed during the course of the contract works.

· Client risk tends to be avoided because the contractor prepares his own measurements and quantities.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· The design must be reasonably well advanced (like Bills of Quantity) in order that tender documentation can be prepared.

· When variations occur, the valuation of changes can be more difficult to agree with the contractor than if firm Bills of Quantities exist, because individual prices for items of work do not exist unless a ‘unitary’ schedule of rates has been requested as part of the Tender.

· Tenders are not as easily comparable to each other as is possible with Bills of Quantity, because the tendering contractors may interpret and price risk in the Schedule of Works document in different ways.

Suitability

Appropriate for use on small to medium sized projects. Tenderers need to carry out their own measurements and produce their own quantities.
The use of Schedules of Works is not particularly appropriate where change can be foreseen post-contract.

http://www.kerncm.com/SoW.aspx

Specification and Drawings

Basis

A contractor is selected and appointed on the basis of a lump sum bid provided in response to a detailed Specification document, which when read in conjunction with the drawings, defines the scope of work to be carried out as the contract works.

The Specification can also include provisional allowances for unforeseen or undesigned work; and also allowances can be included for specialist works yet to be tendered. Measurements and quantities are prepared by the tenderers to enable them to price the work. Like Schedules of Work, the use and meaning of these provisional sums needs to be described and defined in the documents.

Normally, tendering is in competition with a pre-selected list of approximately five contractors.

Advantages

· The lump sum price is firm, subject only to variations which may be instructed during the course of the contract works.

· Client risk tends to be avoided because the contractor prepares his own measurements and quantities.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· The design must be well advanced in order to prepare the detailed Specification documents. This procurement route can therefore mean a later site start than with alternative procurement routes.

· Give less control of cost when variations are instructed than firm Bills of quantities because of the lack of a defined system of measurement of the building elements.

· Tenders are not as easily comparable to each other as is possible with Bills of Quantities, because the tendering contractors may interpret and price risk in the Specification document in different ways.

Suitability

Specification and Drawings are Appropriate to smaller projects such as house extensions and renovations; partly because all tenderers need to produce their own quantities and partly because of the time involved in achieving a sufficiency of the designs to enable the Specification tender documents to be prepared.
Like Schedules of Work, the use this form of procurement is not particularly appropriate where it is likely that change will be required by the client after the contract has been started.

http://www.kerncm.com/SpecandDwgs.aspx

Bills of Approximate Quantities

Basis

Bills of Approximate Quantities are an alternative form of Bills of Quantities (see above) and are prepared early in the design process before a firm design is available.

The contractor is selected, normally by competition from a pre-selected list of between three and six contractors.

Contractors prepare a tender bid based on pricing a Bill of Approximate Quantities. This is essentially a traditional Bill of Quantities but with the quantities assessed from professional experience by the Quantity Surveyor rather than firmly measured, as would be the case with “Bills of Quantities” .
Advantages

· Allows early appointment of a contractor and access to experience in terms of his programming and buildability skills.

· Enables an earlier start on site to be made than with Traditional Bills of Quantities.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· Approximate Bills of Quantities do not establish a firm cost for the work at the time the contractor is appointed, thus there is less price certainty. This is because the actual cost of the works is calculated only when the design is available and detailed re-measurements have been made.

· The client proceeds to the construction stage at greater risk, despite a check being made at the tender stage by means of bids being submitted by the tendering contractors.

Suitability
Appropriate for projects for which an early start on site is required or where the design is reasonably well defined or alternatively where the work is of a repetitive nature following on from other similar projects (allowing assessments to be made of the quantity of works from previous experience), but where time is not available for full Bills of Quantities to be prepared.

http://www.kerncm.com/ABOQ.aspx

Bills of Quantities

Basis

Often referred to as “traditional Bills of Quantities”

A lump sum tender price based upon the priced Bills of Quantities is normally tendered in competition by a pre-selected list of between three and six contractors.

Selection of a contractor is made on the basis of the tenderer pricing measured Bills of Quantities, prepared to standard rules of measurement, for example:

· SMM7

· POMI – Principles of Measurement International

· ARM – Agreed Rules of Measurement (in the Republic of Ireland)

· The planned ARQ – Agreed Rules of Quantification, a simplified SMM to run alongside SMM7. This proposed new SMM is presently (as at 2007) being discussed and drafted by the RICS and has an anticipated publication date of 2008/2009

Bills of Quantities include definitive measurements of the major elements of the building.

Where design is not complete, ‘provisional’ and/or ‘approximate’ quantities can be included.

Additionally Provisional Sum allowances for undefined and defined works can also be included, together with provisional sum allowances for works to be carried out by ‘named’ specialist sub-contractors; which, if required, can be tendered separately – although this is relatively uncommon today and it is more likely that such work will be part of the main contractor’s tender by means of selection from list of ‘preferred sub-contractors’, to then be employed as ‘Domestic sub-contractors’.

This method of procurement is the oldest methodology in the UK. It not now as popular as it was in the first 85 years of the 20th century, but is still often preferred by Public clients.
Advantages

· Cost certainty is generally high but depends on the degree of completeness of design at the time when the Bills of Quantity are prepared.

· Gives excellent comparison of tender bids because all tenders are based on the same measured information.

· Creates a low risk tendering environment allowing tenderers to give their most competitive price because the risk for the contractor is well understood and defined.

· This is a procurement process which is widely understood.

· Gives a good basis for measurement and valuation of variations and for the calculation of interim valuations and the eventual final account.

· Needs the design team to have prepared and developed the building design before the Bills of Quantity can be prepared and so through reduction of design risk often leads to a much greater level of programme certainty and thus the date for completion.

· Can incorporate Design and Build and Performance Specified works if required
Disadvantages

· For the level of cost certainty promised by this procurement methodology to be delivered, the design must have evolved before preparation of the Bills of Quantity is started.

· Errors in the tender documents are normally required to be corrected at the client’s risk.

· Pre-contract phase of procurement is lengthy compared to other procurement methods and so often leads to a later start on site.
Suitability

Appropriate for projects where time is available for design work to largely be completed so that detailed measurements can be made before the tenders are sought.
Bills of Quantity can be used on any size project but can be suitable for those which are extremely large and complex and where the design time required would mean a very long lead-in period.

http://www.kerncm.com/BOQ.aspx

Construction Procurement Guide

Construction Procurement Guide - an overview of the major means of construction procurement currently in use in UK construction - written by Andrew Hudson for Laxtons 2008.

Introduction

There are numerous issues that need to be considered when deciding upon the means of procurement of a building project, and which will determine the Form of Contract to define the obligations and responsibilities between the Parties.

Procurement is the term used to enable the process of creating a contractual relationship. There are four essential elements:
1) Offer
2) Acceptance
3) Consideration (payment)
4) The intention to create a legal relationship

Factors which influence the procurement process include:
• the experience of client and the business case for the project including any particular requirements that the client may have
• the client’s desired programme for development, including the timing of the start and finish dates
• the nature, size and complexity of the project
• the state and completeness of the designs
• the degree of cost certainty, or conversely the requirement for risk aversion
• the need for competitive prices
• the apportionment of risk between client and contractor

There are eight main recognised procurement routes:

a) traditional (bills of quantities; schedules of work; specification and drawings; and the like)
b) target cost
c) design and build; and target cost design and build
d) design, manage and construct
e) management contracting
f) construction management
g) engineer, procure & construct (turnkey) - not dealt with here
h) partnering (also a process – see below)

With the exception of partnering, all of the above routes can be used with:
• a single stage process (tendered or negotiated)
• a two-stage process
• as a process to define a GMP – guaranteed maximum price

Further specialised routes used by public authorities are PFI – the private finance initiative; and PRIME contracting. In the latter case variants of PRIME contracting have been adopted by the NHS, Defence Estates and several ‘blue chip’ private sector organisations. PFI and PRIME are not dealt with here.

For the HM Treasury definition of PFI see: here

For a definition of PRIME contracting see: here

Partnering as a route and a process

Partnering is both a procurement route and a tendering process. Although now well defined and much written about, it is still misunderstood by many professionals and contractors alike, who consider that they have been partnering with their clients long before Egan, having had longstanding and ongoing relationships with clients for a considerable number of years. However, in many cases this is not partnering in the style championed in 1998 by The Egan Report, Rethinking Construction.

Partnering seeks to create relationships between members of the whole project team including the client, design team , contractor(s) and the underlying supply chain. This creates a framework to deliver demonstrable (through KPIs) and continuing economies over time from: better design and construction; lower risk; less waste (time, material, etc); and as a result avoid disputes. Partnering workshops provide for better knowledge, communication, sharing, education and team building to create a much more purposeful relationship than merely continuing to work together with a client.!

Egan's Partnering is discussed more fully later.

Single Stage as a process

The single stage process is in many cases the conventional process of procurement. Tenders are sought based upon one of the routes set out herein and bids are considered and a contractor selected and then appointed based upon chosen criteria defined to suit the project. In most cases the choice criteria involved in the contractor selection will be based upon the most economic cost, but can also be based upon programme, quality of design solution (in the case of a Design and Construct Tender) or a mixture of these criteria.

Two Stage as a process

In the case of a two-stage process, the selection of a contractor is made by means of a first-stage tender early in the project programme before the design is well advanced. With the exception of partnering this process can be used in connection with most of the routes listed above

Normally, the first-stage is by means of a competitive tender based on limited elements of the work, for example: • a schedule of unitary rates provisionally prepared from the design drawings as prepared at the time of the stage-one tender; *
• preliminaries costs (site staffing, plant, site setup, scaffolding, craneage, insurances, etc);
• the percentage required for overheads and profit;
• the percentages required on Dayworks;
• additions required on the sub-contract work which is to be sub-let;
• submission of CV’s for proposed site and head office staff; and
• method statements - so that the contractor’s understanding of the project can be assessed by the design team and the client.
*

If time and design information is available, measurements might be made of selected major work elements (for example demolitions) and Bills of Approximate Quantities (or a Schedule of Works) can then be included for fuller pricing in the first-stage documents.

At stage-one a Contractor is selected from bids made on the basis of the limited information available at the time and will often include, but is not limited to: • proposed preliminary costs
• proposed overheads and profit level(s)
• labour costs
• principle plant costs
• sub-contract works cost, where these can be defined to a level that can be priced
• interviews and assessments of the contractor’s proposed staff
• project understanding and proposed method statements
• the contractor’s willingness to enter into the second-stage negotiations
• and the like

The second-stage, a Bill of Quantities/Schedule of Work or a more fully detailed Schedule of Rates or a mixture of both, is generally prepared by the Quantity Surveyor and is priced with the chosen contractor by means of ‘open book’ negotiation in order to calculate the contract sum.

As referred to above, a two-stage tender process can overlay any of the ‘traditional’ procurement routes and can bring an additional set of advantages and disadvantages to the chosen means of tendering. Set alone, two-stage procurement can provide:
• Early appointment of contractor and access to his experience of programming and buildability.
• An earlier start on site than with a single stage process, because the works can proceed, if required, before a contract sum has been negotiated and fixed.

However two-stage procurement does not establish a firm contract sum at the time when the contractor is initially appointed as this is calculated later. It is therefore most appropriate for projects where an early start on site is required and where a project is reasonably well defined, in terms of the scope of work; and for which management or construction management are not considered appropriate.

Guaranteed Maximum Price (GMP) – as a process

A GMP can be tendered at outset, but more often a previously tendered lump sum contract (excluding Target type contracts) is converted to a GMP following a traditional single or two-stage tender process utilising:
• Bills of Quantity (either Firm or Approximate); or
• a Schedule of Works; or
• Specification and Drawings

Thus the definition of a GMP can occur, either before commencing the works or during the course of the works. The GMP is negotiated with the chosen contractor and his sub-contractor(s) on a basis that includes for the contractor’s future design development of the scheme, albeit in many cases the initial tender methodology may not have included design.

The Contractor therefore assume a larger element of risk that with other contract relationships and takes responsibility for matters that would normally cause extensions of time and potentially additional payment(s).

There are no generally available standard Forms of Contract for a GMP, it will require a bespoke contracts or a standard contract modified by a bespoke addendum agreement.

The advantages of a GMP are that it:
• Gives cost certainty similar to that of a design and build contract whilst the client employs and retains control of the design team.
• Provides the client often with a more appropriately detailed building than might be the case if let as a design and build contract, because the client’s design team retain control of detailing.
• Potentially means that the design needs to be completed to a greater degree than normal in order to let contract as a GMP, because after the GMP is agreed all variations that cause change, will attract cost and programme alterations. Therefore the design team will want to avoid such ‘change’

However, it is also important to note that a GMP contract has the potential to provide ‘rich’ grounds for disputes; particularly in respect of whether varied work has resulted from design detailing and therefore included in the GMP, or whether it is a variation caused by client change, which is an addition to the contract sum.

Very few contractors have experience of GMP contracts and those that do have had mixed experiences. Particularly because the financial and programme risk for unforeseen circumstances is entirely borne by the contractor.

The creation of a GMP creates certainty for both parties. However, a GMP can mean that the contractor can take a heavy fall if things go wrong! Examples of major GMP style contracts are those for the Cardiff Arms Park and also the new Wembley Stadium.

With the exception of a GMP, the eight routes noted are served by a plethora of standard forms of contract, sub-contract, supply agreements, warranties, etc. Such forms are widely available, with versions for use in England versions for use in England and Wales, and Scotland, where the law relating to contract differs from English law.

The success of any procurement route and process will depend largely on the ability and experience of both the chosen designers and contractor(s).

At the time of Tender, it is therefore very important that care is exercised in the selection of tendering contractors. In all cases it is to be recommended that pre-tender interviews take place with the potential tenderers to confirm their suitability for the work in advance; followed by both mid-tender review meetings and post-tender today. It is by definition not intended to cover every type of procurement route nor all the issues and therefore should be considered as a guide only. The following links describe various methods of procurement and each is discussed for: basis; advantages; disadvantages; and suitability:
- Bills of Quantities
- Bills of Approximate Quantities
- Specification and Drawings
- Schedules of Work
- Target Cost
- Management Contracting
- Design and Build
- Target Cost Design & Build
- Design, Manage and Construct
- Construction Management
- Cost Reimbursable or Prime Cost
- Measured Term Maintenance Contract

Conclusion

The choice of a procurement route and tendering process is a complex matter. This section has attempted only to set out the main features of the principal procurement routes and processes available.

It is intended as a broad guide only to assist in understanding the main issues, advantages and disadvantages. In order to make a full assessment of what can be a set of complex issues, you are strongly advised to seek professional advice.

http://www.kerncm.com/procurement.aspx

Preparing for a Successful Mediation

by Chuck Doran

A successful mediation will often conclude with both parties thanking me for my efforts and conveying their appreciation for my apparent ability to settle their case. My response to them is “No, mediators don’t settle cases, parties do. Congratulations.”

What determines whether a case will reach resolution? A key factor is whether the parties have thoroughly and systematically prepared for their mediation.

Being prepared means that the parties have thought through in advance of the mediation what they hope to achieve in mediation, including: what is important to each party; what ideas might resolve the situation and what each party might do if they do not resolve the matter with the other person.

Systematic Preparation

Parties to a mediation are like politicians. To be successful, politicians must identify their goals and, for each, articulate a rationale clearly and with conviction. They must find many ways to skin a cat: legislative battles are sometimes won by being pig-headed, but more often they are resolved by understanding and accommodating the interests of others, generating new ideas, and finding win-win solutions.

With these considerations in mind, I ask parties to think about the following questions in advance of the mediation:

1) Interests - What are you hoping to achieve in mediation? What interests, hopes and concerns do you hope to have addressed? What do you think is important to the other person? What do you think is important to both of you?

2) Options - What possible terms can you imagine both of you agreeing on? What would be considered a good outcome for both of you? (These ideas should meet the interests of the parties.)

3) External Standards - What standards of fairness apply to both of you and to your situation? What have other people done when faced with a situation like yours? What precedents, laws, and industry standards and norms apply to the situation.

4) Alternatives - What will you do if you do not reach agreement? It's important that you compare any options that you create together with what you might do if you do not reach agreement (your alternative to an agreement). Similarly, what will the other party do if there is no agreement? (It’s helpful to understand the other party’s best alternative to a negotiated agreement too.)

5) Communication - What messages do you want to send? What messages do you want to have heard? What questions do you have for the other party?

6) Relationship - Is there a relationship between you? If so, should it continue or end? On what terms should it continue or end?

7) Commitment Are you comfortable with the thought that the mediation may conclude with an agreement that works for you but is not necessarily perfect? Depending on the outcome, are you prepared to enter into an agreement? Does the agreement have to be enforceable from your point of view? Do you need to check in with anyone before committing to the agreement?

An Illustrative Example

Before I continue with other suggestions about how to prepare for mediation, it might be helpful to illustrate how some of these questions might be answered by considering a hypothetical situation. Let’s imagine that a student has come to his professor on the day his term paper is due, requesting a two-week extension.

The professor’s interests might include: ensuring fairness for other students, submitting final grades on time, avoiding disruption of her plans, avoiding the appearance of favoritism, helping the student, and respect. There might well be others.

The student’s interests might include: getting a good grade, opening up time to complete requirements for another course, avoiding failure or embarrassment.

Let's look at the connection between interests and options. Options the professor and the student might consider include: a one-week extension based on a reasonable excuse, a two-week extension with penalties such as extra work or a lower grade, and a grade of incomplete and an understanding that the paper would receive a lower grade than it would normally. The strength of an option is how well the option meets their respective interests.

Standards might be what the professor has done in the past, what is customary in the institution, and what is prescribed by a handbook.

Both the professor and the student should understand what their alternatives are if they are unable to reach agreement.

Alternatives that the student might consider include: taking his case to the dean, threatening to expose the professor on the Internet for not working with the student, doing nothing, etc. Knowing their best alternative will provide guidance to both the professor and the student as they consider how to best get their interests met, whether by entering an agreement or by walking away.

Let’s leave that hypothetical now and continue with other preparations for mediation that you might like to consider.

Beyond Preparation - Thoughts on Choosing a Mediator

Choose a mediator acceptable to both parties. Mediators have different styles, expectations about the course and outcome of mediation, and personalities. They should be free of conflicts of interest. Their qualifications – experience as a mediator, subject matter expertise and an understanding of the culture, for example - should also be considered. A case manager at a mediation firm will be able to provide you with mediator biographies to review.

Be sure the right parties are in the room. In a dispute between two faculty members, the dean may be a necessary party, and there are instances where even the president may be the appropriate party (see the interview in this newsletter with Judy Malone above). Senior figures may bring authority or options to the mediation table that others are not able to.

Make sure everyone understands that what is discussed during the mediation is confidential unless parties agree otherwise. This may come as a surprise to those who supervise the parties or who have sponsored the mediation. Confidentiality, aside from certain legal effects, aids the parties in speaking freely and thinking creatively.

Consider your opening statement. Most mediators ask parties to state why they came to mediation and what they are hoping to achieve. Thinking about what you say can help to ensure clarity, completeness, and brevity. I do not recommend reading a prepared statement, however. A party should make every effort to help the other party hear what they are saying, and a written statement, no matter how well read, is less likely to be heard than an oral statement directed to the other party.

Prepare a substantive elements of a negotiating plan using the seven questions above. Based on their interests, parties should consider what proposals they might make at the mediation, developing a principled rationale for each. In doing this, they should keep in mind that the other party's interests will have to be taken into account if an agreement is to be reached. It is therefore important that both parties come to the table having defined their own and their counterpart's interests, and an effective mediator will ask both parties to prepare in this way.

Lastly, it's helpful if both parties attend the mediation with an open mind. It is common for all of us to think of the one best solution, but what is best in one party’s mind my be anathema in another’s. If both parties assert a solution that takes account only of their interests, and stick to their guns, stalemate will almost certainly follow. That’s why it can pay for each party to consider the other’s interests as well as their own. Not only can this lead to agreement, it can sometimes offer a bigger pie to be explored by the parties.

And that brings us full circle to the questions I opened this article with. The more parties prepare in advance of the mediation, the more likely their mediation will be efficient, productive and successful for everyone involved.

Chuck Doran is a mediator, trainer and the Executive Director of Mediation Works Incorporated in Boston, MA. He can be reached at cdoran@mwi.org.

http://www.mwi.org/university/news/univol1no2.htm

FAQs about Negotiation, Mediation, Arbatration and Litigation

by James Melamed

What is Negotiation?
What is Mediation?
What Are the Benefits of Mediation?
What Are the Roles of the Mediator?
What is Arbitration?
What is Litigation?
What is Collaborative Law?
What if I want to know more about mediation?
What if I want to be a mediator?

Q: What is Negotiation?

A: There are two principle negotiation theories and strategic approaches to negotiation:

competitive or positional negotiation;
integrative or problem-solving or interest-based negotiation.

Distinguish Strategic Approach from Personality

While there may be some correlation between negotiation approaches and personality style, the two do not necessarily go together. For example, a competitive negotiator may be very "pleasant" to work with in terms of demeanor, but utilize extremely competitive tactics. In fact, a negotiator's pleasantries may themselves be part of an overall manipulative approach! A problem-solving negotiator may, on the other hand, be rather ornery in terms of their personality, yet effectively utilize interest-based, problem-solving strategies in negotiation.

The Best Negotiators Will Have Both Sets of Skills

It is also important to appreciate that the most effective negotiators will have a wide array of negotiation skills, both competitive and problem-solving, and will effectively mix and match these approaches depending upon what the negotiator believes will work best with a particular "negotiating partner" depending on the specific issue being negotiated and depending on the nature of the overall negotiating relationship (one-time transaction or continuing relations).

Strategies to Create Value and Claim Value

Another view of negotiation is that certain strategies and behaviors are intended to "create value" (integrative approaches) whereas other strategies and behaviors are intended to "claim value" (be that by competition or principle).

Dispute Negotiation and Transactional Negotiation

Also notice that negotiations may be divided into two types:
dispute negotiation, focused on resolving past facts; and
transaction negotiation, focused on reaching agreement for the future.

While it is often helpful to appreciate this difference between dispute negotiation and transaction negotiation, it is also beneficial to appreciate that many negotiation situations involve the resolution of both past issues as well as planning future relations.

The Competitive Approach

Competitive negotiation strategy is, essentially, a manipulative approach designed to intimidate the other party to lose confidence in their own case and to accept the competitor's demands. This approach is characterized by the following:
High opening demands;
Threats, Tension and Pressure;
Stretching the facts;
Sticking to positions;
Being tight lipped;
Want to outdo, outmaneuver the other side; and
Want clear victory.

When a competitive negotiator is asked how they will know that they have reached a good agreement, they may reply that the agreement is "better than fair."

Assumptions of the Competitive Approach
There are certain assumptions, a world view really, that lie behind the competitive approach to negotiation. This "distributive" world view includes the following assumptions: Negotiation is the division of limited resources;
One side's gain is the other's side's loss; and
A deal today will not materially affect choices available tomorrow.

Risks of the Competitive Approach

While competitive negotiation tactics are often effective in "claiming" already defined value, there are also certain risks to competitive negotiation. Foremost among these risks are damage to the negotiating relationship and a lessened overall likelihood of reaching agreement. Here is a list of the disadvantages of the competitive style:
Confrontation leads to rigidity;
There is limited analysis of merits of dispute and relevant criteria for resolving issues;There is limited development of solution alternatives;
It is hard to predict the outcome of the competitive approach or control the process;
Competitors are generally blind to joint gains;
Competitors threaten their future relations; and
Competitors are more likely to have impasse and increased costs.

The Integrative Approach

The integrative, collaborative or problem-solving approach to negotiation has been described as "enlightened self-interest," rather than the "egocentric variety." This approach consists of joint problem-solving, where gains are not necessarily viewed as at the expense of the other party.

Assumptions of the Integrative Approach

As one might expect, there is a different world view behind the integrative approach to negotiation. The primary assumptions of the integrative approach are the following:
Some common interests exist between parties;
Negotiation is benefited by a full discussion of each participant's perspective and interests; and
We live in an integrated and complex world and our problems can be best resolved through application of our best intelligence and creativity.

Risks of the Integrative Approach

Risks of the integrative approach are based upon the common sense observation that "it takes two to collaborate." If one party is unwilling to participate in integrative, problem solving negotiation, the more collaborative negotiator may be at risk in the following ways:
The negotiator will be forced to either "give in" or adopt a competitive stance;
The negotiator may experience a failure if they do not reach agreement; and
The negotiator is somewhat at risk in honestly disclosing information if that is not reciprocated.

Principled Negotiation

In their book, Getting to Yes, Fisher and Ury set forth their concept of "Principled Negotiation." Here is a brief summary of the main points of principled negotiation:

Separate the People from the Problem

Fisher and Ury suggest that we are all people first -- that there are always substantive and relational issues in negotiation and mediation. The authors describe means of dealing with relational issues, including considering each party's perception (for example by reversing roles); seeking to make negotiation proposals consistent with the other party's interests; making emotions explicit and legitimate; and through active listening.

Focus on Interests, Not Positions

Positions may be thought of as one dimensional points in a space of infinite possible solutions. Positions are symbolic representations of a participant's underlying interests. To find out interests, you may ask questions like: "What is motivating you here?" "What are you trying to satisfy" or "What would you like to accomplish?" You may also ask: "If you had what you are asking for (your position), what would that experientially get you - what interests would that satisfy?"

In negotiation, there are multiple, shared, compatible, and conflicting interests. Identifying shared and compatible interests as "common ground" or "points of agreement" is helpful in establishing a foundation for additional negotiation discussions. Principles can often be extrapolated from "points of agreement" to resolve other issues. Also note that focusing on interests tends to direct the discussion to the present and future, and away from the difficulties of the past. If we have learned anything about the past, it is that "we can not change it." The past may help us to identify problems needing solution, but, other than that, it does not tend to yield the best solutions for the future.

Invent Options for Mutual Gain

Before seeking to reach agreement on solutions for the future, Fisher and Ury suggest that multiple solution options be developed prior to evaluation of those options. The typical way of doing this is called brainstorming. In brainstorming, the parties, with or without the mediator's participation, generate many possible solution before deciding which of those best fulfill the parties' joint interests. In developing options, parties look for mutual gains.

Select from Among Options by Using Objective Criteria

Using objective criteria (standards independent of the will of any party) is where the label "principled negotiation" comes from. Fisher and Ury suggest that solution selection be done according to concepts, standards or principles that the parties believe in and are not under the control of any single party. Fisher and Ury recommend that selections be based upon such objective criteria as precedent, tradition, a course of dealing, outside recommendations, or the flip of a coin.

What if They are More Powerful? - Developing a BATNA

In the event that the other party has some negotiating advantage, Fisher and Ury suggest that the answer is to improve the quality of your "best alternative to a negotiated agreement" (your BATNA). For example, if you are negotiating for a job and want to make a case for a higher wage, you improve your negotiating power by having another job offer available, or at least as a possibility.

What if They Won't Play or Use Dirty Tricks?

Fisher and Ury's answer to the resistant competitive negotiator is to "insist" on principled negotiation in a way that is most acceptable to the competitor. The principled negotiator might ask about the competitor's concerns, show he or she understands these concerns, and, in return, ask the competitor to recognize all concerns. Following the exploration of all interests, Fisher and Ury suggest inducing the competitive negotiator to brainstorm options and to think in terms of objective criteria for decision-making. Another way of thinking about encouraging principled or integrative bargaining is to think in terms of matching, pacing, leading and modeling. To get a negotiator to shift orientations, it is critical that they first experience themselves as fully heard in terms of content, intensity and emotion. By so matching and pacing with a negotiator (asking a few clarifying questions), the negotiator will become more open to your lead and modeling of productive means of negotiating. Negotiation Power

Negotiation power

can be defined as "the ability of the negotiator to influence the behavior of another. Commentators have observed a variety of aspects and qualities of negotiation power. It is important for the mediator to take note of these various aspects and qualities of negotiating power as a means of assisting each negotiating party to be at his or her best in representing his or her interests in mediation. Here are a number of aspects and qualities of negotiating power that have been identified:
Negotiating power is relative between the parties;
Negotiating power changes over time;
Negotiating power is always limited;
Negotiating power can be either real or apparent;
The exercise of negotiation power has both benefits and costs;
Negotiating power relates to the ability to punish or benefit;
Negotiating power is enhanced by legal support, personal knowledge, skill, resources and hard work;
Negotiating power is increased by the ability to endure uncertainty and by commitment;
Negotiating power is enhanced by a good negotiating relationship;
Negotiating power depends on the perceived BATNA; and
Negotiating power exists to the extent that it is accepted

Overall Problem-Solving Negotiation Structure

As an overall model for effective problem-solving negotiation, please consider the following:
Informed Consent as to Process (the process is always negotiable)
Sharing Perspectives (separate relational issues from substantive issues. Discuss both, just separately.)
Remember the Common Ground (common interests, interdependence and easy points of agreement)
Establish a Problem-Solving Agenda (questions seeking solutions: "How can we best . . .?" or "What is the best way for us to . . .?")
Identify Desired Information and Documentation Clarify Desired Outcomes, Interests and Positive Intentions Develop Options (develop options based upon outcomes, interests and positive intentions)
Select from Options (Easy agreements and package deals)
Integration and Finalization (Any possible improvement? What else needs to be done?)
back to top

Q: What is mediation?

A: Facilitated Communications for Agreement or Facilitated Negotiation

Central to mediation is the concept of "informed consent." So long as participants understand the nature of a contemplated mediation process and effectively consent to participate in the described process, virtually any mediation process is possible and appropriate. In terms of generally describing the mediation process, the following concepts may be helpful.

Qualities:

Voluntary
You can end the process at any time for any reason, or no reason. If you are thinking of leaving, you are encouraged you to speak up and let the mediator know why. The reasons that you are thinking of leaving can become conditions for your continued participation. For example, if you are thinking of leaving because you do not feel heard, presumably you would continue in mediation if you felt heard.

Collaborative
You are encouraged to work together to solve your problem(s) and to reach what you perceive to be your fairest and most constructive agreement.

Controlled
You have complete decision-making power. Each of you has a veto over each and every provision of any mediated agreement. Nothing can be imposed on you.

Confidential
Mediation is confidential, to the extent you desire, be that by statute, contract, rules of evidence or privilege. Mediation discussions and all materials developed for a mediation are not admissible in any subsequent court or contested proceedings, except for a finalized and signed mediated agreement for enforcement purposes.

Informed
The mediation process offers a full opportunity to obtain and incorporate legal and other expert information and advice. Individual or mutual experts can be retained. Obtained expert information can be designated as either confidential to the mediation or, if you desire, as admissible in any subsequent contested proceeding. Expert advice is never determinative in mediation. You, as parties, always retain decision-making power. Mediators are bound to encourage parties to obtain legal counsel and to have any mediated agreement involving legal issues reviewed by independent legal counsel prior to signing. Whether legal advice is sought is, ultimately, a decision of each participant.

Impartial, Neutral, Balanced and Safe
The mediator has an equal and balanced responsibility to assist each mediating party and cannot favor the interests of any one party over another, nor should the mediator favor a particular result in the mediation. The mediator's role is to ensure that parties reach agreements in a voluntarily and informed manner, and not as a result of coercion or intimidation. If you ever feel that the mediator is favoring one party over another, or any particular result over another, or if you should ever feel intimidated or otherwise unsafe in mediation, speak up. The mediation should not continue unless you come to be satisfied in all of these regards.

Self-Responsible and Satisfying
Based upon having actively resolved your own conflict, participant satisfaction, likelihood of compliance and self-esteem are found by research to be elevated through mediation.

Q: What Are the Benefits of Mediation?

A: People in disputes who are considering using mediation as a way to resolve their differences often want to know what the process offers. While mediation can not guarantee specific results, there are trends that are characteristic of mediation. Below is a list of some of the benefits of mediation, broadly considered. Mediation generally produces or promotes:

Economical Decisions
Mediation is generally less expensive when contrasted to the expense of litigation or other forms of fighting.

Rapid Settlements
In an era when it may take as long as a year to get a court date, and multiple years if a case is appealed, the mediation alternative often provides a more timely way of resolving disputes. When parties want to get on with business or their lives, mediation may be desirable as a means of producing rapid results.

Mutually Satisfactory Outcomes
Parties are generally more satisfied with solutions that have been mutually agreed upon, as opposed to solutions that are imposed by a third party decision-maker.

High Rate of Compliance
Parties who have reached their own agreement in mediation are also generally more likely to follow through and comply with its terms than those whose resolution has been imposed by a third party decision-maker.

Comprehensive and Customized Agreements
Mediated settlements are able to address both legal and extralegal issues. Mediated agreements often cover procedural and psychological issues that are not necessarily susceptible to legal determination. The parties can tailor their settlement to their particular situation.

Greater Degree of Control and Predictability of Outcome
Parties who negotiate their own settlements have more control over the outcome of their dispute. Gains and losses are more predictable in a mediated settlement than they would be if a case is arbitrated or adjudicated.

Personal Empowerment
People who negotiate their own settlements often feel more powerful than those who use surrogate advocates, such as lawyers, to represent them. Mediation negotiations can provide a forum for learning about and exercising personal power or influence.

Preservation of an Ongoing Relationship or Termination of a Relationship in a More Amicable Way
Many disputes occur in the context of relationships that will continue over future years. A mediated settlement that addresses all parties' interests can often preserve a working relationship in ways that would not be possible in a win/lose decision-making procedure. Mediation can also make the termination of a relationship more amicable.

Workable and Implementable Decisions
Parties who mediate their differences are able to attend to the fine details of implementation. Negotiated or mediated agreements can include specially tailored procedures for how the decisions will be carried out. This fact often enhances the likelihood that parties will actually comply with the terms of the settlement.

Agreements that are Better than Simple Compromises or Win/Lose Outcomes
Interest-based mediated negotiations can result in settlements that are more satisfactory to all parties than simple compromise decisions.

Decisions that Hold Up Over Time
Mediated settlements tend to hold up over time, and if a later dispute results, the parties are more likely to utilize a cooperative forum of problem-solving to resolve their differences than to pursue an adversarial approach.

Q: What is the role of the mediator?

A: The mediator's ultimate role is to do anything and everything necessary to assist parties to reach agreement. In serving this ultimate end, the mediator may take on any or all of the following roles:

Convener
The mediator may assist in contacting the other party(ies) to arrange for an introductory meeting.

Educator
The mediator educates the parties about the mediation process, other conflict resolution alternatives, issues that are typically addressed, options and principles that may be considered, research, court standards, etc.

Communication Facilitator
The mediator seeks to ensure that each party is fully heard in the mediation process.

Translator
When necessary, the mediator can help by rephrasing or reframing communications so that they are better understood and received.

Questioner and Clarifier
The mediator probes issues and confirms understandings to ensure that the participants and the mediator have a full understanding.

Process Advisor
The mediator comes to be trusted to suggest procedures for making progress in mediation discussions, which may include caucus meetings, consultation with outside legal counsel and consultation with substantive experts.

Angel of Realities
The mediator may exercise his or her discretion to play devil's advocate with one or both parties as to the practicality of solutions they are considering or the extent to which certain options are consistent with participants' stated goals, interests and positive intentions.

Catalyst
By offering options for considerations, stimulating new perspectives and offering reference points for consideration, mediator serves as a stimulant for the parties reaching agreement.

Responsible Detail Person
The mediator manages and keeps track of all necessary information, writes up the parties' agreement, and may assist the parties to implement their agreement.

Q:What is Arbitration?

A: Arbitration is an adversarial system of justice designed to present a disputed case to a neutral and impartial third party for decision. It is very much like the adjudicatory (court) process, but a bit less formal. Arbitration is, however, even more binding than a court decision in that, in arbitration, you give up our rights to appeal in favor of getting the matter resolved.

Standard Arbitration Clauses

Parties can provide for arbitration of future disputes by inserting the following clause into their contracts:

Any controversy or claim arising out of or relating to this contract, or the breach thereof, shall be settled by arbitration administered by a mutually acceptable arbitrator, under the rules of the American Arbitration Association. The award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.

Arbitration of existing disputes may be accomplished by use of the following:

We, the undersigned parties, hereby agree to submit to arbitration administered by a mutually acceptable arbitrator, under the rules of the American Arbitration Association. We further agree that the above controversy be submitted to an(one) (three) arbitrator(s). We further agree that we will faithfully observe this agreement and the rules, that we will abide by and perform any award rendered by the arbitrator(s), and that a judgment of any court having jurisdiction may be entered on the award.

The arbitration, unless the matter otherwise first settles, will be concluded with the transmittal of the award. Although there is voluntary compliance with the majority of awards, judgment on the award can be entered in a court having appropriate jurisdiction if necessary.

Q: What is Litigation?

A: Litigation involves either hiring an attorney or prosecuting a legal case yourself in court. Litigation begins with the filing of a complaint or petition and involves discovery, motions, a possible trail and, if desired, at least two rounds of appeal.

Litigation may be a preferred alternative when nothing else seems like it will work. The problems with litigation include that it is time consuming, costly and very high stress. If one side "wins" big, then that decision may well be appealed or there may be problems with enforcement.

All of this being said, if you can afford a good attorney and if you need the clout of the court to catch the other side's attention and/or give you a meaningful chance of true relief, then litigation and the courts may be for you.

Q: What is Collaborative Law?

A: The essence of "Collaborative Law" is the shared belief of the participants that it is in the best interests of parties to commit themselves to resolving their differences with minimal conflict and no litigation. They seek to adopt a conflict resolution process that does not rely on a Court imposed resolution. The process does rely, however, on an atmosphere of honesty, cooperation, integrity and professionalism geared toward the future well being of the parties.

The Adversary System
Law school training and the real world attorney work experience combine in a well established and powerful institutionalization of the adversarial-representative model of conflict resolution. While it is not the only model for negotiating and resolving issues, it is the one which becomes ingrained in anyone who works in a litigation system. Most attorneys who regularly handle litigation work, fantasized, in the days before being admitted to practice, about standing at the bar of justice making an impassioned and eloquent argument which wins the case or surgically dissecting a hostile witness with a brilliant cross-examination. The daily grist of the litigator's mill, however, is the stress and frustration of trying to achieve the client's objectives against the impediments and opposition of the parties on the other side of the case.

The costs of this process are usually observed as being both outrageously high and inevitable. Both are true statements about the adversarial model. What is also true is that this model is ill-suited for the purposes of resolving family law conflicts. Rather than assuming the conflict must adapt to the traditional adversarial litigation model, the collaborative approach is based on the idea that the process should adapt to the actual needs of the parties in conflict in reaching agreement. In the traditional competitive approach, where the parties objectives or strategies collide, it is assumed that the only way to move past, through, around or over the opposition, is to employ the power of the law-based procedures to make something happen. In the face of opposition from the other side, a lawyer looks to the power of the process and often overlooks the reverberating impact that process will have on the daily lives of the clients and their children. Furthermore, this power-based, competitive approach nurtures continued resistance as the participants have little or no reason to view the other side as anything but a threat and something to fear.

Collaborative Negotiating
The collaborative approach is both pragmatic and grounded in its focus on the needs of the parties. Initially, those needs fall into two categories: process needs and outcome needs. The process needs are determined by accepting the party in the emotional state in which they enter the process. That person may be experiencing a wide range of emotions such as, anger, hurt, distrust, bitterness, guilt and grief. These emotions may come with a wide range of personality characteristics such as, intelligent, unsophisticated, analytical, visual, needy or codependent. A good process begins by accepting the participant as who he or she is at the outset. The outcome needs describe the desired goals and objectives of the party which will allow that person to feel the issues are resolved. As we will see, these outcome needs are developed by analyzing the interests of the party and moving beyond the stated positions which have sustained the conflict.

The core of the collaborative process is to facilitate the making of agreements. To be effective in this role, it is necessary to make a mental shift in the mindset that one brings to viewing both the nature of the conflict and the elements inherent in the personalities, characteristics and resources of the parties.

Q: What if I want to know more about Mediation?

A: Please be sure to visit the following Sections of Mediate.com:

www.mediate.com/about
www.mediate.com/resolution.cfm
www.mediate.com/articles

Q: What If I want to be a mediator?

A: Be sure to visit our Careers Section at www.mediate.com/careers

http://www.mediate.com/articles/mediationfaq.cfm

Why you need a Quantity Surveyor?

To broadly describe the work of a Quantity Surveyor, our end purpose is to minimise cost and maximise value on a given project. Either increasing value for money to a developer or end user client, or increasing profit margins for the main contractor or subcontractor, whilst still achieving the required standards specified under the agreement, within contract programme.

A good Quantity Surveyor can cover their own cost several times over on an annual basis, their influence is often the difference between a commercially succesful project, and one which is not. The natural ability of a Quantity Surveyor can vary emmensely, and should not be measured by qualifications alone when selecting for specifc tasks. Shy retiring individuals may not yield best results when faced with negotiating with a bullish self confident opponant, however such individuals may posess a first class honours degree and may also be experts in measurement or estimating.

An experienced Quantity Surveyor will acomplish their objectives in a variety of ways, largely guided by their experience, however more tangible factors also play a part such as a carefully selected procurement strategy, use of terms and conditions of contract and negotiation skills.

The four corner stones of a Quantity Surveyors skill set are often listed as follows:-
1) Estimating
2) Measurement
3) Valuation
4) Negotiation

Schedule of QUANTITY SURVEYOR Services (PQS)

PCS Solutions Ltd provides individuals or small - medium sized Construction companies with a Quantity Surveyor for one off works, or short - mid term contracts, based at client offices or working from the Quantity Surveyors home, on a full or part time basis. Our Quantity Surveyor services are primarily geared towards the following clients:-

- Small to Medium Size Contractors (MC & All trades of Sub-contractor)
- Private Clients seeking the services of a Quantity Surveyor

and to the following sectors:-
- Residential Development
- House Building
- Civil
- Commercial Construction
- Utilities
- Rail

We consider ourselves unique in that our Quantity Surveyors offer discounted rates for remote Quantity Surveyor services, with savings achieved through reduced overhead and travel costs whilst our Quantity Surveyors operate remotely.

For an informal chat on how we might provide a Quantity Surveyor for your project, please call our Commercial Manager Paul on 07800 583109 or e-mail mail@pcs-org.com.

“Over 85% of our turnover is repeat business”

Inception and feasibility

Develop initial budget estimate from feasibility proposals and identify target cost plan parameters.
Prepare overall project cost calculation and cash flow projections.
Pre-contract cost control

Prepare and develop preliminary cost plan.
Advise on cost of design team’s proposals as design develops.
Monitor cost implications during detailed design stage.
Maintain and develop cost plan, and prepare periodic reports and updated cash flow forecasts.
Value Engineer cost during design development to ensure all cost targets are maintained.
Advise Client of all Client Instructions that may alter the agreed Cost Plan.
Attend as required Design Team Meetings.
Tender and contractual documentation

Advise on tendering and contractual arrangements taking into account the Client’s priorities and information available from designers.
Prepare tender and contract documentation in conjunction with the Client and members of the design team.
Provide copies of documentation as agreed.
Advise on use and/or amendment of standard forms of contract or contribute to drafting of particular requirements in association with the Client’s legal advisers.
Prepare programme for separate demolition ontract.
Tender selection and appraisal

Advise on short-listing prospective tenderers.
Attend interviews and tenderers.
Fully evaluate negotiated submissions for accuracy, level of pricing, pricing policy etc.
Advise on errors and qualifications and, if necessary, negotiate thereon.
Prepare appropriate documentation, if required, to adjust the tender received to an acceptable contract sum.
Review financial budget in view of tenders received and prepare revised cash flow.
Prepare report on tenders with appropriate recommendations and issue Value for Money report.
Advise on letters of intent and issue in conjunction with Client’s advisers.
Interim valuations

Prepare recommendations for interim payments to contractors, subcontractors and suppliers in accordance with contract requirements.
Post-contract cost control

Value designers instructions before issue.
Prepare cost report updates in agreed format at specified intervals including any allocations of cost and/or copies as requested by third parties.
Final account

Prepare the final account.
Attendance at meetings

Attend meetings as provided for under this Agreement.
Provision of printing/reproduction/copying of documents and the like

Provide copies of documentation as provided for under this Agreement.

INTERNAL LINKS
Quantity Surveyor from Perth, Scotland - A highly dependable and honest person who is capable of adapting to any work environment. A friendly and extremely hard working person with the ability to function well as part of a team or unsupervised. Knowledgeable and experienced computer operator who is practiced on Microsoft computer packages and is eager to build on and fully utilise existing skills.

Quantity Surveyor from Bolton - Freelance QS since quitting permanent employment in 2002; specialising in the production of Bills of Quantities, Schedules of Works and Builders Quants for Main Contractors, Sub-contractors and PQS firms using the method of measurement to suit individual client's need - SMM7, POMI, CESMM, MMHW.

Quantity Surveyor from London - I have experience of over 25 years working for both employers and contractors and therefore have insight of both sides, which enables me to maximise the benefit for both. I am an excellent negotiator and can work on my own or in teams in delivering large complex projects. I have a vast range of experience in various types of sectors and have used all the major forms of contracts from inception to completion, which has made me an excellent all round QS.

Quantity Surveyor from Sheffield - I am a Senior QS with 30 yrs experience, 20 yrs freelance, and have worked in the fields of building, civils, road, and rail. I have worked for Clients, Consultants and Contractors, and am available for any UK or overseas position. I would welcome the opportunity to become involved with Petrochemical works, either UK or overseas, which I would consider to be a valuable enhancement to my CV experience.

Quantity Surveyor from Bellshill, Scotland - I am driven and self-motivated with good organisational skills. I enjoy being part of a team and promote honesty and good working professional practice at every opportunity – I believe in promoting the attitude that everyone in the team takes ownership of problems, working together with a view to reaching an efficient solution. I am committed and thrive on and enjoy challenging tasks, and I adopt enthusiasm within everything I am charged with. With my Main Contracting, Civil Engineering experience, together with my management experience, I believe I have the necessary skills to be able to offer the type of positive contribution. I am eager to continue to develop personally, and believe no matter what I am challenged with, I can adapt, perform and achieve the desired results required in any given task.

Quantity Surveyor from Kent - An experienced Managing Quantity Surveyor with a range of knowledge gained from working in the construction industry in excess of twenty years. Flexible, passionate, ambitious, self-motivated, people orientated, and technically minded.

Quantity Surveyor from Suffolk - Acquired and obtained considerable knowledge and experience in Quantity Surveying through formal education and involvement in a wide range of projects. Additional knowledge in Project Management complements Quantity Surveying skills and abilities. Computer literate with proficiency in excel spreadsheets. Commercially astute.

Quantity Surveyor from Essex - I enjoy undertaking pre and post-contract cost-management and have had vast experience on an array of prestigious projects. From pre-tender to final-account and completion, cost planning, value engineering, option analysis, procurement advice and contractor selection my desire and ambition allowed me to enjoy a Senior Managing QS role.
Quantity Surveyor from Blackburn - 12 years experience on a broad variety of Civil Engineering and Infrastructure contracts. Involved with quantity surveying, estimating and procurement; from initial stages through to final accounts.

Quantity Surveyor from Sutton - Fully qualified and widely experienced with a commercial attitude. Self motivated, well organised and able to work without supervision.

Quantity Surveyor from Bolton - I have been working as a quantity surveyor for 25 years and during this time have undertaken most QS duties, I have extensive experience. In September 2004, I became self employed working from home in Bolton and have undertaken work for a number of different Consultancy’s, Contractors and Local Authority’s, supplementing permanent staff on larger projects or undertaking work on an individual basis such as bills of quantities, builders quantities, feasibility cost plans etc.

Quantity Surveyor from Cheshire - Freelance Quantity Surveyor with clients who are Main Contractors and Sub Contractors.

Quantity Surveyor from Cumbria - Freelance Chartered Quantity Surveyor since May 2006 and specialising in the preparation of Take-Offs, Bills of Quantities and Work Schedules, for traditional, design and build and drawings and specification tenders. I also have experience in the preparation of budget costs/estimates, valuations and the preparation and agreement of final accounts.

Quantity Surveyor from Northern Ireland - Before embarking upon my quantity surveying career I had worked on a number of civil engineering projects in Northern and Southern Ireland. Such experience and practical knowledge gives me the technical knowledge that I can apply to any elements of quantity surveying, whether tendering or submitting a compensation event.

Quantity Surveyor from Northern Ireland - 11 years experience working as a Quantity Surveyor on large scale building, civil engineering, Housing and refurbishment contracts. Previous experience includes; procurement of new work through tendering for both traditional and design and build projects; commercial management of construction projects, including money recovery, cost control, financial reporting and contract administration; procuring subcontractors and suppliers including negotiating conditions of contracts, rates and payment terms; compilation and preparation of bill of quantities and liaising with existing and prospective clients within the industry to seek out new avenues of work.

Quantity Surveyor from Birmingham - having been a Chartered Surveyor for 23 years I wish to utilise my considerable experience and contribute to the successful delivery of major rail infrastructure projects.

Having worked as a rail consultant for the past eight years I am seeking a full time position in which my management skills, pro-active approach, expertise and teamwork capabilities will be instigated to optimum effect.

Quantity Surveyor from Newcastle upon Tyne - Working as a freelance Cost Consultant covering all aspectsof cost management from procurement through to final account.

http://www.pcs-org.com/