How best to balance value and risk in procurement

摘要

As an industry, we talk a lot about value and risk, but not always in the context of procurement. The way a construction project is set up and the manner in which it is bought are undeniably critical to its success. The general objectives of the procurement process are to select a competent and committed full project team; to introduce each team member at the appropriate time; to secure value for money (the optimum balance between the highest standards of materials and workmanship, the shortest possible programme and the lowest possible cost) and to create incentives for the achievement of the client's declared objectives. However, above all of this, value and risk are the principal focus of procurement arrangements - how value is secured and risk is disposed of. If there is a general rule, it is that the client should carry risk for no longer than they can create value by doing so. This value might be secured by getting a better building (however that may be defined) or by avoiding paying too much to offload the risk (as risk is not shed free of charge).