So in the Industry today we hear an awful lot about projects going over budget generally our reaction to that is uh, again
So its become commonplace for projects to run over budget but in reality is that professional?
Have we done a good job if the project is done over budget? No.
So what I’d say to people is what do you think about projects that go over budget?
Is it commonplace? – do you think? Also is it professional?
Comment below – lets have a chat
Økonomi har altid være et fokuspunkt i hvilket som helst agenda som vi støder på i vores hverdag …
Når man kigger nærmere på den dansk byggebranche, kan man tydeligt se at økonomistyring ikke er blevet fokuseret nok. Dette gælder både bemanding af ressourcer til økonomistyring, og fokus på økonomi i projektstyrings dagsorden.
F.eks. med en ’traditionel’ procentsats 2% af byggeudgifter for byggeledelse, herunder økonomistyring, regner man ca. 10% UFO for entreprenørs krav og ekstraarbejder (sum 12%). Hvis bygherre fordobler byggeledelse budget til 4%, kan UFO potentielt reduceres til 5% (sum 9%). I alt er der reduktion af 3%, samtidigt kan man potentielt forhøje projekts kvalitet og beholde projekts tidsplan, og gøre alle parter i projektet glade – bygherren, totalrådgiver, og entreprenør.
I sidste ende er økonomi et af det fokuspunkt i et projekt succeskriterier, og det fortjener mere fokus og opmærksomhed.
The discussion of Partnering Contracts is a high talking point in the Danish construction industry at the moment. Both Bygningsstyrelsen & Region H have both openly discussed there favorable view of using this type of contract on their projects in the future. While Partnering is, in our opinion, a far superior contract structure compared to any other in the industry, it takes a knowledge and a know-how from all stakeholders for it to be successful. Here are our top five needs before entering in to a partnering contract.
People will normally do what they are used to, so if the key people are coming from traditional contractual background it will be very difficulty for them to change their mindset and way of working.
Transparency generally relates to the commercial (economy) aspects of the contract. This is a vital aspect of partnering and it is important that the client gets the correct advice of how to set up the partnering contracts from experienced specialists.
Partnering work great when everything is running smoothly but when the relationship is strained the only tool that left is the contract. If the contract is poor and poorly structured it will not support the strained relationship. Vital that the contract is clear, structured and instructive.
This will give all stakeholders a clear picture of how the client wishes to deliver. Again this contract administrator needs to have experience in partnering contract.
So incentivised agreements will always be preferred by stakeholders to feel more committed.
the one weakness that partnering agreements will have in Denmark is around the commercials (economy). The understanding of good quality commercial documentation is quite poor and it leads to allot of issues between stakeholders and more often than not costs clients due to over paying. In order to have transparency in the commercials (economy) it is important to understand what is meant by transparency.
We are NOT talking about every nut and bolt but a level of detail that is sufficient to assess additional work. If you are only asking for a total price for foundations or ventilation systems you are going to be in trouble. You need the detail so that the commercials (economy) can be managed.
It is also important to have a clear picture of when to transfer elements of risk, or when you need a fixed price and a remeasure able or a cost plus element to the contract. These can be mixed, and I would advise should be mixed, depending on the project and risk profile.
If you would like to discuss this in more detail or have any questions please contact us.
Come back here for updates.
