© graham m winch iii : mobilising the resource base1 iii : mobilising the resource base mobilising...

III : Mobilising The Resource Base

1© Graham M Winch

III : Mobilising the Resource Base

• mobilising the resources required to deliver the project mission

• forming the project coalition• motivating the project coalition• the dynamics of the supply chain• appropriate transaction governance

– flows across a technologically separable interface


2© Graham M Winch

Appropriate Transaction Governance

asset specificity

frequency

unc

ert

ain

ty

opp

ortun

ism

bounded rationality

learning

appropriategovernancemode


3© Graham M Winch

5 : Forming the Project Coalition

When people seldom deal with each other, we find that they are somewhat disposed to cheat, because they can gain more by a

smart trick than they can lose by the injury which it does to their character

Adam Smith


4© Graham M Winch

Forming the Project Coalition

• the principal/agent problem in construction– adverse selection– moral hazard

• procuring construction services• the formation of project coalitions• selecting resource bases• improving procurement practice


5© Graham M Winch

Procuring Construction Services

• four selection options– in-house capability– appointment– concours (competition)– competitive tendering

• supplier selection methods– level of uncertainty at selection– point in project life-cycle

6© Graham M Winch

Supplier Selection Methods

level of dynamic uncertainty

level of mission

uncertaintyat supplier

selection

high

low

designservices

executionservices

in-housecapability

in-housecapability

appointment

concours

competitivetender

competitivetender

appointment

early late

concours


7© Graham M Winch

Formation of Project Coalitions

• three options– separated routes : trades and general contracting– integrated routes : turnkey– mediated routes : construction management

• the formation of firm contract– a life-cycle perspective

• procurement route risks– from a client perspective


8© Graham M Winch

Separated Project Coalition 1: Traditional Trades Contracting

client

roofersmasons carpenters

architect / surveyor

other traders

9© Graham M Winch

Separated Coalition 2: General Contracting

client

consultantquantity surveyor

main contractor

domestic sub-

contractor

operative workforce

architect

nominated sub-

contractor


10© Graham M Winch

client

operative workforce

turnkey contractor

sub- contractors

Integrated Coalition: Turnkey

in-house professionals


11© Graham M Winch

Mediated Coalition: Construction Management

construction manager

client

trade contractors

architect consultantquantity surveyor

12© Graham M Winch

Client’s Risks Associated with Different Project Coalitions

min

max

max

max

min

min

low

high

mission uncertainty

client’s realisation risk

client’s conception risk

client’s specification risk

integ

rate

d

sepa

rate

d

med

iated


13© Graham M Winch

Criteria for Selecting Resource Bases

• in-house– no choice

• appointment– certification and reputation

• concours– open or invited

• competitive tendering– tendering code of practice


14© Graham M Winch

The Formation of Firm Contract

• when risk passed to the supplier• early contracts

– low value contracts– high value decisions

• late contracts– much higher value contracts– lower value decisions


15© Graham M Winch

The Formation of Firm Contract

early latedynamic uncertainty

integrated general contracting management contractingdesign and manageconstruction managementtrades contracting


16© Graham M Winch

Improving Procurement Practice

• e-procurement • partnering

– raising transaction frequency and enabling learning

• best value – appropriate price/quality ratios

17© Graham M Winch

Appropriate Price / Quality Ratios in Competitive Tendering

min

max

max

high

low

uncertainty

importance of price

importance of quality

quality / price ratio

© graham m winch iii : mobilising the resource base1 iii : mobilising the resource base mobilising...

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