www.fultonhogan.com state of play: collaborative contracting nz-au 12 july 2013 peter kessler coo...
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www.fultonhogan.com
State of Play: Collaborative Contracting NZ-AU
12 July 2013
Peter KesslerCOO Construction, Fulton Hogan Australia
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Key Features Positives Negatives Future Enhancements
Limited Constructability input from Contractor
Generally poor tracking tools on varied work
Too many issues bank up to contract completion
Focus on getting the job done
Relatively short tender period
Fastest delivery start up Client retains flexibility to
change design/scope Client accepts more risk and
in return attracts lower industry margins
Cost Reimbursable Construct Only Generally referenced back
to Contract (AS or Bespoke) Typically 20% Contractor
share of TCE Underun TCE gets adjusted for
material variations to scope Typically 30% Non Price
Attributes adjustment (common)
KPI regime funded by Client + or -2% of margin
Some flexibility on KRA/KPI regime
Only lose margin
Specimen Design Design Initiative promoted Pain / Gain operates on
agreed KRA/KPI’s Non Price Attributes
adjustment (uncommon) Trend to blended
Contractor/Designer margin NOP’s can only lose their
margins Original principle that
excellent performance should return >BAU profits
Becoming expensive to bid Low TOC’s rewarded
(examples where no net R&O)
KRA Pool tends not to incentivise
Client can end up paying extra for Holden Commodore
Reduced margin by extending site overheads into corporate overheads
Occasionally short tender periods
Capable of fast delivery start up
2nd place getter stipend for release of design
Experts embedded in client team to chaperone complex projects
External R&O Adjustment, External Escalation Adjustment, KRA Pool increased, in exchange for Contractor accepting margin threshold
Mandate Start up constructability workshops
Standardise traffic management allowances
Reform wet weather provisions
State of Play: Collaborative Contracting
www.fultonhogan.com
State of Play: Collaborative Contracting
12 July 2013
Peter KesslerCOO Construction, Fulton Hogan Australia
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