The Impact of Integrated Procurement Contexts on Project Management Practice in the Construction Sector
Start Date: Apr 2003
End Date: Mar 2005
Project Status: Complete
The research will investigate the impact of integrated procurement contexts (e.g. PFI, PPP, Prime Contracting, Procure 21) on project management practice in the construction sector. Such integrated approaches to procurement have already impacted on project management practice and will have an increasing impact in the future. The implications for firms are huge in terms of the additional skills necessary for ensuring competitive advantage. There will also be a significant impact on the structure of the construction industry. It is likely that a continued commitment to integrated procurement contexts by major clients will create market niches with high barriers to entry that approximate towards high-trust economies. Participants are likely to secure long-term competitive advantage provided they can respond with more integrated ways of working. The danger is that previous mindsets will continue to dominate, despite the lack of structural barriers to innovation implicit within traditional procurement routes.
The absence of the process discontinuities of traditional contracting provides the incentive for contractors to develop their skills in collaborative working. To be successful contractors will need to compete on the basis of knowledge and expertise rather than lowest cost. Within the context of an integrated high-trust economy, continuous improvement can become a reality rather than rhetorical aspiration. Unfortunately, to date there is little evidence to suggest that contractors have significantly deviated from established ways of working. Whilst the notion of ‘integrated project teams’ received a significant boost in Accelerating Change report (Strategic Forum, 2002), there is no current consensus on what it means in practice. The research will bring clarity to this important area by investigating the meanings and practices ascribed to integrated project teams within the context of integrated procurement. Particular emphasis will be given to innovation and the need for supporting human resource management (HRM) policies. The research will use a combination of quantitative and qualitative methods to investigate the way in which advocated management techniques reflect and reinforce structural change in construction procurement.