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Construction Procurement

Construction Procurement

ISO 10845 Construction Procurement Standard to Improve Performance

A new international standard for construction procurement was created in 2010. The standard consists of a series of standards, providing the guidelines for development of a construction procurement system that is clear, cost-effective, and fair.  We take a look at some parts of the standard.

ISO 10845-1:2010 Construction Procurement – Part 1: Processes, methods, and procedures

The standard provides the guidelines for the procurement processes around which an organisation can build its own company-relevant procurement system. The standard provides the minimum requirements for employees, board members, and agents of the company in participating in the construction procurement process. It provides the framework according to which the organisation can develop its own policy and provides the generic procedures that must be followed in procurement. Procurement entails the method and process followed in contract creation, its management, and fulfilment of the requirements. To this end, implementation of ISO 10845:2010 Part 1 is highly relevant to any company wishing to procure any type of construction-related work, services, or products.

ISO 10845-2:2011 Construction Procurement – Part 2: Formatting and compiling of procurement documentation

The standard provides the guidelines for the format for compilation of expression of interest, contract and tender documents, and construction works, engineering, services, and supply contracts. It, in essence, provides a standardised approach to the tendering process and all documents involved in it.

ISO 10845-3:2011 Construction Procurement – Part 3: Standard conditions of tender

The standard sets out the conditions of tender, how the employer and the tender submitter must behave, what is required from the tender submitter to ensure compliance, and how the evaluation criteria for tenders must be made available, as well as how the employer must proceed in receiving and processing offers. It also covers how the employer must provide feedback on the outcome of the tender process. Part 3 of the standard is relevant to procurement of goods, construction works, and services other than by auction.

Part 4 and 5 of ISO 10845 – Conditions for calling for tenders and participation of contracted companies

The series also consists of Parts 4 and 5. Part 4 deals with the standard conditions for calling for tenders or interest. It covers what the respondent must submit to ensure compliance with the required submission procedure. It also covers the evaluation criteria and the method to follow in calling for expressions of interest. Part 5 deals with the establishment of key performance indicators (KPIs) for measuring the outcomes of the engagement between the business entities. It thus provides the guidelines for establishing the minimum performance criteria for a contractor to ensure performance compliance.

Part 6: Participation of targeted partners in joint ventures in contracts

Part 6 of the construction procurement standard deals with the establishment of a KPI in terms of reaching the participation goals for the participating partners. It describes the methods for measurement of the KPIs and the verification of the performance related to targeting strategies.

Part 7: Participation of local enterprises and labour in contracts

It deals with the same principles, methods, and measures as Part 6, but relating to the performance of local enterprises and labour in fulfilling their contracts.

Part 8: Participation of targeted labour in contracts

It provides the KPI of the contract participation goal as relevant to participation of the targeted labour in the contract award for the provision of construction, services, or engineering works.

Importance of the Construction Procurement Series of Standards

Adoption of ISO 10845 by companies around the world will make it possible to standardise international tendering and procurement practices within the construction and engineering fields. In many African countries there are no procurement policies available. The standard makes it possible for companies and government agencies in such countries to follow set procedures in dealing with international tenders. The standard has been developed in such a way as to allow easy integration into the construction procurement systems of companies and countries. This will enable role players to perform better and to have KPIs against which to measure performance of procured contractors.

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