Time for project management to look to the past

3rd January 2009

The economic uncertainty faced by the UK construction industry means it is time to consider moving away from the Design and Build method of procurement and use the more traditional Bill of Quantities method on projects, according to quantity surveyors at Robinson Low Francis (RLF).  

In recent years, during what has been a prosperous time in the construction industry, clients shunned BoQ and began using D&B,” said David Meghen, associate partner at RLF. “This was because D&B allowed them to gain planning permission and begin a project’s build phase quickly. And, if used properly on simple projects or those with a tight timescale, D&B can still be a good option.

However, when a client enters stage two of D&B, things can become complicated – as the design is still being developed, packages may be higher than the target cost plan and some works may not be included within a particular package. This, ultimately, puts financial pressure on the client and with banks becoming increasingly reluctant to lend, this is a situation most clients would want to avoid. Yet many contractors prefer D&B because it gives them a greater opportunity to keep contingency in risk rather than placing it in a lump sum situation where risk is better defined.

While Bill of Quantities involves more input – both financially and time-wise – at the beginning of a scheme, the result is that the project is less likely to incur unforeseen costs or fall foul of unexpected risks. That is why we advise our clients on the best option for their scheme, and why many are now considering and opting for BoQ.”

Richard Lloyd, project manager at GraceMark, said: “We use Bill of Quantities wherever possible because it means we have a more accurate basis for comparing tender returns and there is less chance contractors will pursue cost claims. Essentially Bill of Quantities is a lower-risk option and one I believe many firms would benefit from using.” 

Steven Surridge, Director of Facilities at The Institute of Cancer Research, added: “We have preferred to use Bill of Quantities for our significant projects for some time now, and in some cases we also require that the mechanical and electrical services are measured. This method provides us with a more comprehensive design, and consequently a more secure procurement process with greater cost certainty.”

According to RLF, one of the benefits of BoQ is that a full design must be provided by the design team in order for a BoQ to be produced. This ensures that the design has been fully considered, detailed and coordinated and any exploration work has been undertaken before work commences. As a result, the quantity surveyor can review the cost plan for the project with a greater degree of certainty.

Further, in the D&B tender process it is necessary to analyse contractors’ proposals, which may differ widely from the Employer’s Requirements. “We often find that BoQ tenders are more competitive than D&B,” added David. “With D&B contractors have to produce their own bills of quantities during the tender period, and the quality and accuracy can sometimes be suspect.

When the project is on site, the client is not held to ransom as the bills of quantities will provide a basis of the valuation of any variations. Given that finance for projects is now more difficult to achieve, it is extremely worthwhile for the client to invest more time at the design development stage to get the design correct rather than designing whilst the work is in progress which does not allow a closer control of cost and can lead to cost claims from the contractor.

Bill of Quantities was once the norm. Now, it is sometimes perceived as being a more time intensive process. However, this is a misconception because by investing time and money at the pre-planning stage, clients will reap the benefits in the long run with projects that stay on-cost and on-time.”

 

Ends

Media Contact, RLF:
Kate Jones
Mandate
Tel: +44 (0) 20 3128 8130
Email:      kate.jones@yourmandate.com

Notes to Editors:

About RLF
Robinson Low Francis (RLF) is a UK firm of construction and property consultants, with over 100 years of experience in the industry.  The company provides services to public and private sector clients and is currently involved in projects with a total value well in excess of £1billion.

RLF has 170 staff spread across seven offices in the UK (Birmingham, Brighton, Edinburgh, Glasgow, London, Manchester and Stevenage) and one in Malta and was recently voted one of the UK’s top professional services firms in the “MPF100 Best Professional Firms to Work For” survey and ranked in the top 75 firms featured in the Building Good Employer Guide 2008.

Key areas of work are quantity surveying, project management, engineering services, building surveying, management consulting, health and safety services and more recently specialist sustainability advice to meet the major environmental changes in the industry.

RLF works across the commercial, education, government & defence, healthcare, industrial, office, residential, retail and sport & leisure sectors, to provide clients with innovative solutions to their construction and property needs. Clients include Royal Mail, John Lewis, Grosvenor, Pfizer and Barclays. For more information visit www.rlf.co.uk