A new guide from The Housing Forum offers practical guidance for housing associations and councils on procurement which can be applied to offsite construction. The key is to start with a clear vision and then hold on to it, says its author Matthew Goulcher, Managing Director of Levitt Bernstein.
While the housing sector has much to be proud of, all of us who’ve been involved in the design and construction of new homes know what a frustrating business it can be. The all-too-common approach has been to opt for the cheapest bid and then transfer as much risk as possible to the contractor. As sure as night follows day, corners get cut and quality invariably suffers. Many well-meaning initiatives intended to rectify this flaw have not proved lasting, for a variety of reasons.
This time it may be different. The quality failures that have come to light across many housing schemes, and tragically in the Grenfell Tower disaster, have galvanised unprecedented determination from industry and government to overhaul quality and safety. At the heart of the new mindset is an acceptance that an improved procurement process is essential to the reforms. Government has made valueled procurement a policy imperative in its procurement green paper and an important strand in its ‘Construction Playbook’ – a blueprint for the development of the construction industry.
The Housing Forum, whose members span the housing spectrum – from clients to contractors, to manufacturers and designers – has been using its expertise to capture good practice. For the past 18 months I’ve been chairing a working group which has been examining procurement processes over the last 25 years and reflecting on what has worked, and what hasn't. It’s a complex picture. There has been a great deal of blame for failure channelled at design and build contracts, for example. But what has become apparent from our workshops is that even with design and build, good teams working well together with a supportive client, and an excellent contractor team that really wants to engage, can produce excellent projects. However, in the current environment this is achieved more by luck than any sort of planned process, so The Housing Forum has set out the key ingredients for success.
The result is ‘Better Procurement for Better Homes’ a very practical guide for local authorities and housing associations, to help them get the developments they aspire to and build the sustainable communities that they and their residents want. The guide is about establishing and maintaining good relationships, having a clear vision and holding on to it. And managing project costs and risks equitably. We are also advocating bringing in the supply chain early – which will help for adopting homes built offsite too.
It’s split into six chapters and covers all the various steps from design considerations, through to achieving quality on site and the contracts underpinning the collaborative approach we recommend. We are not being prescriptive – but rather, setting out a methodology to help clients articulate a vision and show them how to work with the best people to deliver that, including harnessing modern methods of construction (MMC). The guide makes the point that long-term construction quality can be improved within a controlled factory setting. Here are some of our key recommendations:
Create a vision – we're recommending all projects should have a formally documented project vision plan – and we’ve developed a template for clients tailored for this. The areas that this should encompass are broad: how you intend to maintain the vision with good project governance and monitoring? What are your cost and programme parameters? How do you intend to form the team – and deliver design quality? What is the social value you want to lever from the project and how do you draw in the voice of the residents? These are just some of the considerations to work through at this early stage.
Appoint the right leader – our second non-negotiable for success is about getting the leadership, right and getting the project setup set up properly in relation to governance, advocacy and client ownership. We're talking here about holding on to a concept vision through its life. And that needs high-level leadership from inside the client organisation.
This is often how it works in the higher education sector where we also do a lot of work. For example, the estate’s development department deliver a project. But there will also be a steering group of academics and other end users. If they see they're not getting the lab that they wanted, or the reception they wanted, they shout, and there's not enough of that that goes on in housing.
Foster collaboration and procure on shared values – be clear about your vision and objectives, including defining ‘quality’, and procure the team based on a shared understanding and alignment of values. Have clear selection criteria, including a price evaluation model that does not promote a ‘race to the bottom’. It’s important too that these shared values should be embodied throughout the supply chain and not stop at first tier contractors.
Drive quality of design with a clear design brief – procuring good design on projects must start with a clear and realistic design vision setting the degree of aspiration, which is endorsed at senior level, and setting out how you intend to provide continuity of the team to provide design integrity and the golden thread.
Appoint the consultants and contractors early – early appointment of the consultant team and contractor and early engagement with key suppliers is crucial to drive quality, innovation and collaboration and greater cost certainty. It is important to select a form of contract which allows for early appointment and a process for developing design and price collaboratively.
Put in place a clear inspection regime – it needs to be clear on-site who's doing what. Our view is that the design team needs to be involved more – they are in the best position to know whether what was designed has been built. Good procurement can never be about signing a design and build contract and just turning up at a monthly meeting: it’s not about selecting contractors on the lowest bid and nor is it anything to do with finding as many ways as possible to offload risks on to the supply chain. All those things are a recipe for cost overruns, disputes and defects, as many housing providers have learnt the hard way. The values and behaviours set out in our guide founded on collaboration between client, consultants and contractors will result in safer, higherquality homes and better places to live.
To read the full article, go to Offsite Magazine
