Supply Chain Management, Construction Contracts and Contract variations

Assignment Requirements

Project Management in Construction

 

Assignment 3: SCM, Construction Contracts and Contract variations

“Variation is almost an inevitable part of any construction claim. Given the competitive environment that the construction industry is usually in, many contractors probably rely on the proprietor’s variations to make a reasonable return for their contracts. These variations inevitably compromise quality since a trade off between price and performance is the norm.  Consequently ‘agility’ of the construction process is virtually impossible to achieve as a result of the culture of variation claims within the construction industry”

Consequently:-

  • Using examples that you are familiar with, and literary evidence that you discover, analyse this statement for its validity;
  • Analyse the features of current design, tendering and supply chain practice in construction that are likely to make variation more likely than in other industries that you may be familiar with;
  • Develop a framework to define how the role of the project manager can be used to expedite the delivery of a project and reduce the likelihood of variation claims within a standard construction contract such as NZS3910 or FIDIC;
  • Hence determine how you believe a project manager’s role can be redefined, either by responsibilities or by the terms of engagement so as to reduce the impact of variations on construction projects and increase the capability of the construction industry to be ‘agile’.
  • To what degree do you believe that variations in contract affect the risk profile of a construction project, and thus what measures would you employ pre- and post variation to ensure effective delivery?

 

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