Hello and welcome to the APM podcast.
APM is a childhood body for the project profession.
My name is Mike Heinen, online, editor for apm's, project
journal, and your host. And our topic today is contracts
and collaboration contracts. Create legally binding,
obligations between the parties involved in a project, they
describe the nature of those obligations and the actions that
can be taken, if they are not met as such, the contract is a
foundational document, whose content will come to define the
project and how the work unfolds.
It is there to provide certainty and protection to the parties,
but there may be an opportunity for contracts to be used to
create ongoing collaborative relationships, rather than
simply defining strict requirements, and being regarded
as a tool to give parties leverage, in the event of
acrimonious circumstances to find out a bit more about how
project professionals can enhance their knowledge of
contracts and get more from their relationships.
With contractors, I sought the input of a couple of experts.
First up, I interviewed Sarah shooter, Sarah is an independent
solicitor Advocate consultant and trainer whose company
shooter Consulting limited as a niche practice in project,
management and law. She's also running a webinar
series for apm's contracts and procurements Sig entitled basic
contract law for project managers.
You can find a link to the first installment in the episode
description. Hi Sarah.
Thanks for joining us to begin with, please.
Could you introduce yourself and give a bit of background to your
role and your experience with contracts.
Yes, of course. Thanks my gets really, really
exciting to be here on this, AP and podcast, thank you for the
invitation. So I'm an independent solicitor
Advocate. I work for myself.
My little company, choose, a Consulting limited.
We've been going for about seven and a half years.
Now, I specialize in construction, engineering and
infrastructure, projects, including technology projects,
and I'm working on projects of All Sorts, but mostly Within
those sectors at the moment. If I look around my desk, I've
got a couple of any C3, contracts and subcontracts.
I've got a Professional Services engagement for project manager
and a supervisor to look at for one of my clients I've got my
collaborative workspace, open for a webinar that I'm sort of
emceeing in September, on alternative dispute, resolution
and I've got a nondisclosure agreement for Consulting.
Engineer who I want to help him to get through and to nail a
deal down. So there's lots going on.
For sure, at the moment and summer season is no excuse.
I've also got a pile of accounts in front of me because at this
time of year, when my kids are off holiday and work, come
naturally quietens down and deadlines elongates a little bit
through projects, then I try and get some of the infrastructure
as I call it to my own company done as well.
And that includes things like the accounts, updating our
template. It's getting some new training
workshops ready for September. So yeah, we've got quite a lot
on. We're juggling lot, but never
complain. And always keep trucking.
We're talking today about contracts for project
professionals. So I want to start off with a
very simple question, what are contracts?
And why are they important in a project context?
That's a really great place to start.
A contract, is really an arrangement, a deal.
It is the means by which you Regulate, an arrangement between
two or more parties, generally speaking contracts, all over the
world are what we call bilateral.
So there between two people or two organizations, or one of
each you can of course get multi-party contracts as well as
the partnering variety of the alliance in variety and
contracts come in all different shapes and sizes.
So right at the very basic end you've got what we call a simple
contract which is works and services for money.
Me and right at the other end of the spectrum, you've got super
complicated network of project contracts, which might have side
agreements, which might have third party involvement, which
might have all sorts of stuff to do with stakeholders and funding
agencies and local public bodies and that sort of thing, but
whatever size and shape of contact you've got, however,
complex or simple. It is the hugely important in a
project context because they regulate the relationship
between the Teas. And therefore the parties
understand what it is that is being done or delivered or
procured whatever the correct verb is that hat, that attaches
to, that contract for an amount of money. you've described how
contracts appear on a spectrum from simple to complex, but are
their components that are to be found in all contracts
irrespective of their level of complexity, Yeah, there are
actually and in order to have a contract in law, you have to
have these components. So it's not that their
components of a typical contract of such, but actually that if
you want to have a contract in the eyes of the law, then you
need to have these components. Now anybody who has listened to
the APM, webinar series that I'm doing for the second time, we'll
have heard in episode 1, what those components are now.
If you haven't heard that, let me Let me in let you in on that
on that secret. You need to have five components
of a contract. The first is that you need to
have an offer so that is an offer from one party to the
other. To either do work.
If it's coming from the seller or to go out to the market and
ask for work. If you're the buyer of works or
Services then you need to have the opposite, which is what we
call acceptance. So it's an acceptance by the
buyer of the sellers works or services.
Or it's an acceptance by the seller to what the buyer is
wanting to to buy. Now, in order to mesh that
together you need something called consideration which is
normally money when we're talking projects but it maybe
money's worth, it doesn't have to be cash as such but it must
be something which is unidentifiable swap between the
parties. For those works and services
that are being done. We also need an intention.
We call it an intention to to create legal relations.
And in essence, if you have a written contract, that will be
taken for granted because you will have signatures to the
contract. If you've got an exchange of
emails that can perform a similar function with much more
informal oral contracts, that's a bit more tricky because you
haven't got any written evidence to show what that is.
But if the parties agree it, and they can exchange a note on it,
then again, that will more or less servers as the correct
component for that and then we need something called Acity now
capacity in commercial contracts is all about an authorized
signatory. A person who has the authority
on behalf of the organization to enter into the contract and if
you are an individual, then you have authority on behalf of
yourself so capacity, tends not to be too difficult in
commercial contracts either. So there you have it.
Five elements for a contract in law.
Why is it important for project professionals to have a good
grasp of contracts and not to regard them as just something
for the legal department to deal with?
Yeah, that's a really good question and it is so important
for project professionals to have a good grasp.
The first is that for themselves and for their organization to
understand what are the works. All the services that they
themselves are delivering for their client.
What are those promises that they have made or probably have
been made on their behalf? And then they are delivering
Going for their organization. So you've got to understand that
in order to deliver firstly, what you're supposed to be
delivering but also to then, think about how to do it.
Effectively efficiently. And of course profitably the
other angle for project professionals, depends on the
role and for certain project professionals you're going to
need to have a better understanding of other contracts
in the network of the project. For example, if you are
appointed as a contract 200 JCT contract or your appointed as
the NEC capitalized project manager, you're going to need to
understand what it is that the contractors delivering for the
client because you're there as the contract administrator,
you're there as the person who is going to be looking at the
work that's been done, that's going to be certifying what
money is going to be paid over and perhaps making judgment
calls and decisions about Works which haven't been done very
well. All services which haven't been
completely Added and therefore you don't want to certify that
money ought to be paid. So you know, the commercial
details of those other contracts can be blacked out can be
redacted, but you do as a project professional who is
dealing with being if you like an agent between the parties,
you're going to need to understand what the scope of
that other contract is and perhaps other contracts around
the outside as well. What details within a contract
should project professionals? Pay special attention to Okay,
so the first thing that they need to pay attention to is the
scope that's going to be the scope of Works themselves or the
scope of services that are going to be delivered.
And again, both within their own contract.
But also with any contracts, which they are helping to
administer through their Professional Services, they're
going to need to also look at payment terms, because if you're
a certify, you need to know what payment to be certifying.
When, to be doing it, how frequently to be doing it and
perhaps, Might even be details in the contract such as the
format to use or template documents or a system that you
need to have access to in order to be able to do that
certification process for other project professionals as well.
In particular for project managers, it's a really good
idea to have a special look at the contract processes.
Now there'll be tons of different processes but you can
focus in on things like problem solving.
Ooh, okay. What happens if a dispute
arises? What is the process that the
parties are going to use? How long is it going to take
should any third parties be involved other important
processes for project managers or things like a completion
process? What does completion mean?
How is it certified who needs to come and inspect?
Are there any commissioning tests should videos and
photographs be kept excetera, Etc.
So the contract will have lots of detail in it.
About various processes that project.
Smells need to pay attention to and project managers in
particular need to pay attention to those ones.
And I suppose, if I think about it that the other process to pay
attention to would be the dealing of any risk, which
arises those are quite well established in many forms of
standard contract. But again, there's something to
pay attention to, there will be time scales to work to.
There will be paperwork that needs to be exchanged and go
backwards and forwards and then maybe assessments that need to
be done as well by the project manager.
So, I mean, you know, you could say could project professional,
good pay attention to every contract term but but one never
has time to do all of those things.
So, for a project manager, those would be the three.
I would concentrate on risk management, completion and
money. And I suppose the fourth one
which is a good one to have up your sleeve would be problem,
solving and dispute resolution. Can you tell us a bit about
Express and implied terms in the contract and what to watch out
for? Yes, of course.
It's pretty simple, actually Express.
Terms are those which are expressed which have been
written down, which have been agreed between the parties,
whether orally or in writing. So an Express term is something
that you can see and an implied term is the opposite.
An implied term is silent. It's invisible.
It may be something which are the parties have agreed but
haven't written down. It may be something which they
haven't. Gust at all, in which case there
are scenarios where the law and this is done through a court or
through an adjudicator, will step in and literally imply a
term into a contract such that the contract will be interpreted
using that employed term. So implied, terms can be quite
useful. They can also be a bit scary
because, of course, they are invisible, and that makes them
in certain so people like Xpress terms, because you can see them
in front of you. And because there, You can
understand the regulation of the relationship between the
parties. But implied terms, they can be
positive, they can be negative. So, positive, implied term would
be act reasonably and - implied term would be, don't commit
fraud in your application for payment, you know, things like
that, which people say, yeah. Okay, fair enough.
I understand those, I don't need to write them down.
They sound perfectly sensible and, you know, and that's
absolutely fine. But there are other employed
term. Terms which always come back to
the threshold of reasonableness in law.
So if you want to do something, which isn't going to be measured
or benchmarked against the test of reasonableness, then you want
to make it Xpress. For example, the work must be
completed within three months, okay?
In the absence of giving that Express term in the contract
written down or agreed orally, the court would imply, or the
law would imply an implied term which would be the works.
Must be finished within a Reasonable time.
And the reasonable time would be considered of all the
circumstances in which that work is being done.
Including resource availability, time of year, whether there are
any subcontractors involved have complicated, etc, etc.
So if you want to do something and have the certainty about it,
the best way to do that is to include the statement as an
Express term. What are some of the risks
associated with poor practice around contracts?
Now what could happen? Example, if a project
professional doesn't give due care and attention to the terms
of a contract. That's it.
That's a great question. It's something that I often come
across through, lack of Education, really and training
of project managers. And this is what I something
like this podcast is such a great opportunity to get that
message out there for project managers.
There's lots of risks and they and it comes back to to actually
the question about having a good grasp of contracts.
The first is that you need to project managers need to be
aware of Their Own. Tracked.
So if you don't deliver your own Services properly that can put
you in breach of your own contract or your organization's
contract more likely and that could be also professional
negligence and that's, you know, hideous for all sorts of
reasons, you know, on a wider sort of project level.
If a project manager isn't playing their part then that the
the agency role. If you like the certifier role,
the independent assessor role that they Play that they broke a
between that the client and the contractor is is is poorly
regulated and is liable to be very fragile or able to be
vulnerable to disputes. And basically, nobody really
knows what they're doing. So then everybody is doing what
they always do and they and they know solidly within their own
technical expertise what they're doing, but they miss the nuances
and the subtleties of the contract which are the bits that
regulate where money flows? How time works?
Who needs to do what when What is, you know, what is triggered
by one party when somebody else does does a particular action?
So the risks are that the project unravels not in a
technical sense because technical people know their
stuff and they will get to the end of the project, but it
unravels in a governance side it unravels in a in a maturity side
and it unravels in the sense of a relationship side because we
don't have that tightness that regulator contract process which
will Here and guide people step-by-step to the end.
How can project professionals take a more active or proactive
role in the Contracting process to help mitigate some potential
risks? Yeah.
I absolutely Advocate all of that and trying to give my
project manager. Clients, a voice and encouraging
those in-house project managers within Contracting functions to
try and be a bit more vocal pre-contract in procurement in.
In stage because they are the ones and this is literal.
In some cases, get handed the contract and told to go off and
get on with it. You know, our job is done and
hands are washed and pre contract and procurement folks,
get on with their next. Prospect the project manager.
Meanwhile, is given something which they've never seen before.
They haven't had any input into let alone be able to perhaps
even influence how the terms of the the of the contractor put
together. I was actually looking at one
last week. This is a really good example.
Actually, a project manager for an NEC subcontract.
The sub contract was negotiated and the standard term reads that
a particular action has to happen within 3 weeks.
Now, the subcontractor has had that term reduced from three
weeks down to two weeks and the Tractor, which is the
subcontractors client has had that term increased from three
weeks to four weeks. So suddenly people who before
have to do in the vanilla form, do something within 3 weeks have
either got less time than they thought.
Or as a bonus, I got more time than they thought and the
project manager on dealing with that, the subcontractor has only
very recently been alerted to the fact that they now have two
weeks to do something rather than three weeks.
And it's those kind of things where project Jurors could
really useful e, both be informed but also be consulted
on, you know, you have to apply the real life to this stuff.
What does it mean for that project manager to have only 2
weeks to complete? Whatever the action is rather
than three weeks is it possible? Is it okay, great?
If it is but if it isn't always puts the organization at risk,
or with more resource has to be pulled together in order to have
the completion. Evidently in capably, within a
two-week period rather than a three-week period, Then the
project manager is going to have to be very agile.
Is going to have to book to Pivot themselves in order to be
able to do that. And of course, if they don't
know that exist, how can they possibly plan to deliver the
services that they that they need to deliver?
In your experience to contracts. Tend to be viewed negatively.
I is something that's only referred to, in an adversarial
situation. Where are they regarded
positively as the foundation for a good business relationship?
Well, that of course is exactly how they should be saying.
I mean the contract is it is what it is, in the sense that it
is, the the document, hopefully, it's a document that makes life
a lot easier. The document, by which the
relationship is regulated, and I come back to this all the time
because I think that is how it should be viewed.
And certainly views differ, as to the usefulness of contracts
and whether they are viewed positively or negatively and I
guess, depending on any given situation depending on which
side if you like, and there's a, there's an issue with sides as
well. You could say that, you know,
one term is positive for one party and negative for another
or one process is helpful to one party.
But, you know, unhelpful and burdensome to another so it does
largely depend on the pair of eyes that is At it.
But I try to get my clients to look at contracts as the
regulating mechanism as the set of processes and tools that they
have that have been agreed. And in some cases that their
organizations have paid a lot of money for to have negotiated on
their behalf. Not always, of course, a lot of
it's done in house, but but you know, sometimes there is an
investment piece. So what's the point of having
made that investment whether it's time?
Money, external. Internal people have needed to
come together to put into shape this contract into being, to
sign it, to send it through various gateways and governance
and legal and everything else only for everybody to ignore it
and do what they always do. So, in that sense, when you talk
about the, the risks, about poor practice, and why it's useful,
and helpful to project managers to really kind of stand up and
say, look, I need to see this contract, I want to have a part
in the negotiation of it. I want to be consulted.
Because I'm going to be the one who's delivering there.
Sits my neck on the Block. Then all of those things come
together to say, well, we should be viewing contracts in a
positive way. They aren't, they aren't there
just to be dusted off when things go wrong.
Because if, when things have gone wrong it's too late was
actually the contract is there to help you and to steer you
through all of the tools and processes and to help you to
anticipate and have foresight about things, which could go
wrong or which might go Go on or which look like they might be
going wrong in which case there's stuff in the contract
that's going to help you to bring it back on track, whether
it's by risk management, or early warning, processes or
flagging up notices and you know, pulling it, pulling an a
an Emergency meeting together, that sort of thing.
The contract will have that kind of thing in it.
Within projects decisions often have to be made very rapidly.
What is the implication when a quick decision creates working
Arrangements that aren't covered by an existing contract?
I think this happens very often and I think it's all credit to
project managers micro decision-making and ability to
Pivot that they can do these things confidently.
And in most cases, fairly capably, there are risks, of
course attached to creating working Arrangements outside of
the On track, not least that you might do a heap of work and not
get paid for it, which I suppose is that another sort of big dose
of the real life bit of delivering contracts.
The question around project manager, Authority is an
interesting one because if the project manager is given
sufficient authority to create these kind of working
arrangements and we get the term of payment Etc sorted then
actually, that can work very, very well and it can, it can
push through things. He's speedily that might
otherwise be slowed down by some, you know, torturous
governance process or have to go through a bunch of stakeholders
or whatever it happens to be, of course, depending on the size of
the contract, and the amount of stakeholders that one has to
talk to you about this stuff but those informal arrangements are
in some cases necessary. And so the project manager being
both capable in a contract fashion but also technically
capable in terms of his or her. These can often work through
those kind of working Arrangements in a very in a very
sort of agile and practical fashion.
The worry of course is the bit that you've done work that you
don't get paid for and there's no easy way around that
sometimes decisions have to be done.
Sometimes that has to be the priority in the moment and the
other stuff, the commercial side, if you like the financial
side has to be dealt with after the event.
It is a risk. But depending on the the, you
know, the project at stake and what the pivotal decision that
needs to be made is that might be the right decision in the
moment and of course project managers need to be supported if
they've been given you no authority to to move the project
along as they see fit. So just to end with that like to
ask you to tell us a bit more about the upcoming installments
in the webinar series, you're running for the APM contracts
and procurement Sig. I will, I'm really excited about
this because we first ran this on Teen.
I was I've known John broom for many years.
John Bruno has is very well known in the APM and has been
the chair of contracts and procurement Sig fought for many
years. And John invited me.
I think back in 2016 or 2017 to be thinking about this, this
contract and project manager space.
And it's been, it's an area that I've worked on, for many, many
years. So I was really interested to
help out. We first ran the serial He's in
2018, we had a bit of a break and then Corona has happened and
everybody's been in a bit of a tailspin, of course, but we're
back for 20 21 and it's new and refreshed.
It's a three parter where we already had part number one in
June. And that can be picked up by APM
members. It's stored in the, in the apm's
Library, part two is September and part three is in November in
part 2. We're going to Focusing on how
you build a contract and what project managers can use freely,
add to that process. It's going to pick up on things
like those examples of the the time scales for actions that I
talked about earlier and part three is going to be some stuff
on problem solving. And what happens?
How can project managers help out when when things go wrong or
they're threatening to go wrong? So we're talking about nipping
problems in the bud and, and really getting the project
manager to use all the abilities and, and all the contract
knowledge that they will have by the end of the series, to put
them in a good position to then, you know, go off them
confidently and capably into the contract.
Sunset. To find out a bit more about
contracts in action. I spoke with Richard Cairns
director of Korean Browns London project and program management.
Team working in the Pharmaceuticals and Life
Sciences sector. Richard is a fellow of a p.m.
and a Committee Member of the program management Sig.
We spoke about contracts including any C4 and how the
pandemic might be influencing best practice around contracts.
Thanks for joining us, Richard. So begin with please.
Could you introduce yourself and give a bit of background to your
current role? Yeah, hello everyone.
So I'm Richard Cairns I'm a director at Korean Brown and I'm
responsible for the London and Southeast pharmaceutical and
life science project management team.
So I've got nearly 40 members of Staff in my team and we provide
projects program design Management Services as well as
projects and planning schedule management a bit of Bim
Management Services as well. And then document management
projects happen and supports it's a various public and
private sector clients The team were working with some quite
large and complex and interesting projects at the
moment and one of them even had a visit from Boris Johnson last
year although we do lots of Not. So Glamorous, work for our
clients as well. I've specialized in in
pharmaceutical and life science program and project delivery
open last kind of five years. But I haven't always worked in
that sector. I've also worked in education,
Healthcare government, and a bit of new build residential and
regeneration as well. The last kind of 20 years and
each of these sectors has their preferred unusual contract
choices and project delivery preferences as well.
You mentioned there are a couple of different sectors you've
worked across. So like to ask you with in
Farmer and Life Sciences, what Contracting disciplines does
that sector use that perhaps distinguishes it from for
example the public sector work that you've done in the past.
Yeah really really good question.
I suppose. Especially the team currently,
you know, they're delivering pharmaceutical and life science,
construction projects, and they vary in size and complexities.
They work on lots of different types of projects, kind of 200
million, plus new, build vaccine, manufacturing, and
pandemic response, facilities, right down to konev refurbishing
containment, Laboratories upgrading, or replacing kind of
a Statewide infrastructure Building Services projects as
well. I supposed, you know, most
professional bodies Produce their own kind of standard forms
of construction, contracts, and Engineering contracts as well.
The most popular kind of standard forms are going to be
the joint contrast tribunal the J, CT, which publishes Suite of
Standard, Building contracts, and related contracts as well,
such as collateral warranties, sub contracts as well.
Another really popular ones new engineering contract any see
which was originally kind of published in the early 90s after
the landfill, Of construction Excellence report and the latest
edition of our sin e C4 which was published quite recently
more, you know, 2017. There's others as well.
So, it's also the association for consultant Architects, quite
often abbreviated to Aca and that's got the project partner
in contract which is PPC 2000, which is kind of first,
published it in the 2000 year, but it's been revised in 2008.
And again in 2013 and the ACA statement was it was the
original one, the first standard partment contract as well.
So the types of contracts used in the team vary from.
Come on. Sighs type scale, procurement
and complexity of each of the projects that they're working
on. And also, if they're in a public
sector, private sector as well. You know, generally, we use cone
of je, CT design, and build or Standard Building contracts
without quantities there. They're more used in the private
sector and then any see any C3 and any C4 and more used in the
in the public sector. But it, you know, isn't a hard
and fast Rule and both sectors and we can and do them.
Do you? Both forms of contractors.
Well, we've also got a few projects being delivered under
the institution of chemical engineer so I can be contracts
as well. What are some of these strengths
or unique characteristics of the ik me contracts?
I can be so that this this type of contrast.
Drafted as a performance-based contract for the design and
construction process plan really the other outputs, you know, and
and output based projects. So it specifically addresses
liabilities and And testing regimes appropriate for
performance of plant. Really good example of that.
We're using an ARCA me contract to deliver a new building
simulator project. One of our, one of our clients
are the moment is working wellness.
It's exactly right for that type of project.
Really, you know, I'd probably say, you know, generally most
common use for my Contracting, the team at the moment, it's the
only see for engineering and Construction contract which is
abbreviated to ECC. And that's really The, the
contracted choice for the public sector but that's kind of
focused on the type of work that we're doing with a lot of
government bodies of moment as far as specifics go.
So kind of the NEC for PCC contract is got nine core
Clauses. You know, these are split
between like one is General to contractors responsibility three
time for Quality Management. Five payment goes down, you
know, six compensation events, 7 title 8.
Listen Insurance streets at 29, termination.
You've also got kind of options with NEC as well.
And it goes from option, A down to option.
F. These option A is kind of the
price contract, activity schedule.
Option b is price contract with bills of quantities, see Target
contract with activity, schedules, and d-type contract
with bills of quantities, a cost-reimbursable contrast and F
management contract. You know, you choose the right
option based on a client's kind of time, cost quality, and
procure and Route objectives. Their project really.
So would you say that customizability and flexibility
are some of the key strengths of any C4?
Yeah, you're definitely. Yeah, I mean, most of the, but I
suppose the most commonly used options that are in the team use
that, hey, which is kind of price contract, activity,
schedule and Andy, which is kind of cost-reimbursable.
So, they're kind of opposite opposite ends of the spectrum,
really, for kind of fully designed or not, and you're
doing a Time reimbursable type Arrangement.
The NEC is split into three different types of Clauses.
So, X Clauses, a kind of used for Can be optional clause in
the contract that kind of standard Clauses in the contract
W Clause is the use for dispute resolution.
And I supposed to know your point on flexibility.
You know, any see gives you the option to use said causes for
additional Clauses in the contract and we can talk a bit
later about how they can be used to kind of achieve client
specific objectives in certain areas as well.
You've plugged recently for a p.m. about the construction play
book. Published by the government,
tells us a bit about what the Playbook is, and why?
It's valuable for the project profession.
Yeah, that's right. Yeah we wrote A Blog for the APM
in June this year. It was the construction Playbook
and how sustainable Contracting is guiding the government's
recovery plans. So I'm a Committee Member for
the APM program management sick and I try to provide kind of
thought leadership on appropriate subject, matter
topics. And, you know, encourage
collaboration a bit of knowledge, sharing transfer.
And I really enjoy that part of my role for the a p.m.
So I get involved in a in webinars and writing thought
leadership. Schools.
I've got a follow-up block it in August, on the construction
Playbook as well and it's going to focus on Modern methods of
construction. So or MMC so I've got a busy few
weeks ahead but specifically answering your question the
construction Playbook as opposed as part of the government's
strategy to build our way to a better economy.
You know, they've committed to delivering construction
engineering projects and programs.
You know what you build schools, hospitals prisons and major
instrument. Infrastructure Works to support
the economic recovery from the pandemic and delivering
excellent public sets of works. We are crucial part, the
government's recovery plan. I think they've committed
something like 37 billion pounds worth of public sector contracts
to go to the market over the next year.
So, you know, we're talking big numbers really to help to help
me that aim that the cabinet office is produced the
construction Playbook. You know it's abbreviated down
to the Playbook is what is commonly known?
Apps and that provides kind of government guidance on sourcing
and Contracting Public Works projects and programs really The
Playbook supports the government's Ambitions and plans
to transform the public sector estate and infrastructure
networks. Kind of going through over the
next decade and Beyond really supporting their aims to kind of
build build back better faster. And Greener, you know,
sustainability is a real key key to it as well.
It focuses on kind of The process of programs and managed
correctly with the optimum, kind of purple best contractual
strategy and solution from the outset of really whether the
scope is delivery of a school, a hospital and major
infrastructure project, the principles of the Playbook of
really the same state detail the approach for assessing kind of
procuring and managing Public Public Works, and projects and
programs, really. So it's really about best
practice and how it applies across the board.
Yeah, yeah definitely. Yeah.
I mean one of the one of the key principles is creating an
effective kind of Contracting environment.
So, you know, that's one of the one of the 14 key policies of
the Playbook and its aim to ensure that contrast is
structured to support an exchange of data.
No Drive collaboration is a really big theme.
Improved value manage risk with a drive for kind of continuous
Improvement as well. But as if there's another real
Theme coming from the Playbook which the government wants to
still focus on outcomes to create long-term value kind of
all through successful project delivery.
So they want this to create a contrasting landscape that
delivers Converse a sustainable resilient and effective
relationship between Contracting parties and a supply chain.
They just they don't want one off contrasted with long-term.
Collaborative, relationships, being Bill going forward, which
is great. I think for the industry
thinking a bit more about collaboration.
How can contracts be? Used to foster a more
collaborative way of doing projects.
Yeah, cut contracts. And there are spoke wording
causes and requirements can be used to implement kind of many
specific clients or project requirements including kind of
promoting and encouraging collaborative working and
practices kept going back. You know the 1994 constructing
the team commonly known as the lamp from reports.
That the starting point for most, you know, most recent
change changing agenda in the UK construction industry.
The why? Fred growth of partnering and
subsequent kind of collaborative working, can all be kind of
traced back, right? You know, right away back to
that 1994. All Anthem report, really the
NEC particularly, you know, approaches and the way
approaches the management managing of contracts.
It was really endorsed him in the lamp and Report, you know?
And which was kind of the government's review of
procurement and contractual arrangements and UK construction
industry at that time. So going back nearly kind of
What 20 years, but the use of any she contrast with Play-Doh a
key key in helping part in the industry to kind of do things
differently and better with collaboration kind of right at
the heart of this, you know, in my view as well.
The four pillars of success are all kind of embodied in the NEC
contract and those are kind of you know, one working together
to stack together, you know, 3 adding value.
And then for Innovation they're all the key principles of I'm
fully embodied into the NEC country.
I really and they should all be embodied into kind of most
contracts in contracted approaches and processes really
in my view. How do you think the change in
working conditions brought about because of the pandemic has
impacted the way we need to think about Contracting
practices? Yeah, another another really
good question, really, so I'm very currents as well.
So one of the one of the changes in working condition of
practices that I've personally experienced in a pandemic is
obviously remote working and remote.
Idiot delivery. You know, we're all kind of
working from home, a lot of use of kind of virtual kind of
meeting software, you know, Ms. Teams is a great example,
really? I don't think I'm unique here
and probably the whole country of you saying something similar,
but I suppose there's a working example.
Last year I was working on a, on a project, using a development
management agreements, which stated a requirement for
contractual notice under under that kind of contract or
agreement. It's be shoed in hard copy
recorded correspondence, delivery with wet signatures and
you know obviously working remotely in a pandemic and kind
of mitigating spread and kind of this.
The spread of the virus that just wasn't practical or
appropriate for those type of working conditions in the
pandemic, really? I suppose it's worth noting as
well. That NEC for the new the new
contract or newish contract. That came out in 2017.
Mmm. Braces.
All these kind of digital changes that are happening in
the construction industry especially around communication
and, and been really, which are essential in this ever-changing
world. Particularly the moment, you
know, in the pandemic or, or coming out of the pandemic, I
think we've changed over the last 18 months and and
certainly, for the better really another highly current topic.
Of course, is sustainability. What are some of the ways in
your experience of addressing sustainability concerns through
contracts? Yeah, especially if a client has
a particular sustainability ambition or Target that they
want to achieve through a project on way to do this.
It could be through the use of, I'll use any see again as a
specific example, but you know, could use a specific Z Clause,
we talked a bit about that earlier, didn't we?
You know, as an additional Clause to the contract under the
NEC engineering and Construction contract?
You know, it could be worded to include A specific
sustainability or carbon reduction Target as a key
performance indicator or or kpi as a contract requirement.
And, you know, there's a number of reasons that could drive
this. You know, a local Authority
planning condition of building regulation part L requirements
or a Brie am Target or aspiration.
There's also carbon reduction kind of aspirations aimed a
supposed minimizing environmental environmental
impact of your business cutting Waist and acts extravagance as
well and kind of generate just minimizing your carbon
footprint, really? It's very, very current and
topical at the moment. The UK government recently
stated it is NetZero strategy targets set by the climate
change Act of 2008 and at least expose 100 percent reduction in
UK greenhouse gas emissions by 2050 compared to those two kind
of 1990 levels. So contracts, then requirements
play Key Parts in Meeting those requirements really, you know,
as well as sustainability they could be used in other areas as
well and, you know, we're seeing this a lot, you know, myself and
the team. You know, this is coming through
a lot in after areas, where kind of public static clients using
said Clause is to implement social value or corporate and
social responsibility aspirations through the
procurement effect construction projects.
And this this is all filtering down into the supply chain.
Are there any specific or unique?
Meek considerations around sustainability for building
projects within farmer and life sciences.
Yeah, I think I think I wouldn't say there's anything
particularly unique about farmer and Life Sciences very much like
for like a cross construction industry.
But farmer and life science unit, depending on what the
project is, it could be Rd, you know, research and development
facility or kind of a cgmp Time. Manufacturing facility.
Everybody controlled environments and complex kind of
complex buildings and places really and sometimes achieving
those those The sustainability targets can be more complicated
than a than a say a new-build block of flats which is
obviously less complex, you know.
But but I wouldn't say there's anything particularly specific
about the farmer and laughs insectary only that it's a much
more complicated environment, so Implement highly serviced as
well. So you know, it's a bit more
complicated I suppose in summary in your view how can contracts
help drive a culture on a Act, for example, and agile culture.
Yeah. Yeah.
I mean contrast can certainly help Drive project culture and I
suppose it all comes back to to ensuring that you select the
right procurement and contrast strategy that meets your own
specific requirements. Really, you know what meeting
the clients objectives and business case and user
requirements brief are essential really.
We've talked a lot about any see in this podcast and I think it's
a fantastic sweetie of contracts, but it does have its
crew. Systems which are mainly focused
around those being heavily administrative, you know, with
with inflexible kind of process-driven contractual
requirements, I don't think there's any one size fits all
type of protein in the construction playbook.
For example, states, that the standard contract should be
should be chosen and the following sweets and it
specifically mentions any c 3 or 4 JC 2016 in and PPC 2000.
So it gives you a range of Stood options contractual Arrangements
can be can be usually added to in some kind of model contracts
to help deal with projects and clients specific requirements or
risk so which are not covered in the main contract term.
So, if you've got a kind of actual working requirement,
these can be easily inserted and dealt with through a contract
Amendment wording. Or a said clause, for example,
under any c, so you can easily Implement those if needed
finally reflecting on the headline-grabbing vaccine
rollout program from the Okay, government, which is broadly
been deemed a huge success. Are there any lessons on the
contracts and procurement side that we can take from that
program and use going forwards? Yeah, I mean first of all kind
of in answer to that I think you know I think I think the
government has done a fantastic job in the vaccine rollout
program, it's something that country can really be proud of
over the last Connor, 12 months. I think, you know, when compared
to other nations we've really excelled in what we've done on
that program. So, you know how soft to
everyone that was involved in it.
Really, I personally wasn't involved in the government's
vaccine rollout program, but I did did have some pre-contract
involvement in the design and construction of the new build
vaccine manufacturing and pandemic response facility.
It was a really great project to work on but I think looking back
you did need to be very thick-skinned the times whilst
working on it, but I'm really proud of the role that I played
or small part that I played in it.
The frames, you know, it's an absolutely great project to be
involved in one of the lessons that I've learned and took for
my involvement in the project is ironically for this podcast is
that there's definitely a time and a place not to be overly
contractual and there's definitely a need to be a bit
pragmatic, you know, particularly, you know, when
working with such an important projects, you definitely need to
make sure that you take the time to select the right procurement
and contract strategy as part of a project initiation, you know,
right at the beginning. Of a project if you don't get
that right. You know, it could really the
wheels could really come off on a project really special.
What other Lessons Learned can we take from the last 18 months?
Really? I think flexibility and
innovation in Project delivery. And contrast strategy has proved
to be really crucial, you know, in the response to kind of these
exceptional kind of nature of the pandemic and the challenges
that we faced over the last kind of year or 18 months for A
rapidly evolving kind of projects and contract
requirements, iets complex changing stakeholder groups, you
know, fluid Financial control, will you know, maybe there isn't
so much driver to on cost, you know, you just need to get it
done. Just to kind of save lives,
really high levels of kind of external public scrutiny, as
well, with kind of made it necessary to kind of innovate
and adapt through every aspect of the kind of contract strategy
process, really? It's been achieved in a number
of ways, doesn't it throughout kind of the project and program
life cycle over the kind of lost 80 mums?
You know, flexible procurements key design and construction
Solutions need to be highly kind of strategic in your sourcing as
well. You know, aimed at maximizing
buying advantage in responding quickly to risks in supply
chain, disruption, brexit certainly hasn't helped That
regard, but, you know, we've got through it.
I think moving forward, you know, stakeholders should
continue to kind of employee flexible kind of innovative
procurement solution approach really.
And that will allow us to adjust.
And, and flex to me, you know, growing needs going forward as
part of the pandemic response or kind of, if needed in a
telephone, a second or third wave now, but, you know, if we
need to upscale vaccine manufacturer, we will need to be
flexible. Really What my personal
reflection of working through the pandemic really is, you
know, I think we've learned a lot and enormous amount over the
last 18 months. No against enormous odds.
You know we could we can still deliver from a contractual
perspective and you know what we have seen this really you know,
impossible or unattainable in 2019, we've shown throughout
kind of 2020 and through into 2021, you know, it's now
possible. So, you know, just keep
collaborating be flexible and apply.
And if it's you've approached I think we can step up and meet
any new challenge that 2021 and Beyond throws.
It's just really. Thanks to Sarah and Richard for
their contributions to this episode.
I'd like to wrap up by summarizing some of the things
that we've learned firstly contracts.
A hugely important in a project context because they regulate
the relationship between the parties and enable them to
understand what work is being done to live it up cured.
They set out in clear terms the scope timescales and processes
for disputes and risk mitigation as Sara explained.
And awareness of contract is important for project managers
because if they don't deliver Services properly, it could be
in breach of contract. And relationships and governance
could begin to unravel. Richard meanwhile explained how
contracts can help Drive project culture during you select the
right procurement and strategy to meet your own specific
requirements, along with the clients objectives and business
case, it's also worth remembering.
The contracts aren't just there to be dusted off when things go
wrong because of the huge Investments of time and money
that go into contracts. They should instead be viewed in
a positive way, there is an opportunity for project
professionals to stand up and make their voices heard.
They need to see the contract, have a part in its negotiation
or at least be consulted. They are the ones who have to
deliver and take ultimate responsibility for the outcomes.
We also heard about the role of contracts in sustainability.
Now inserting specific Clauses, can Implement social value or
corporate social responsibility aspirations through, for
example, procurement of a construction project.
And finally have the pandemic has taught us collaboration,
flexibility and Innovation and project.
Delivery and contract strategy are crucial and faced with
rapidly evolving situations. With complex changing,
stakeholder groups, check the episode description for links to
Sarah's webinar series and Richards latest blogs for a p.m.
Em. Get in touch with your feedback
and suggestions at a p.m. podcast at think publishing
.co.uk. This podcast has been brought to
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Get in touch with your feedback and suggestions at a p.m.
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This podcast has been brought to you by APM the charts body for
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