Otago Polytechnic

David Finnie considers how contractor involvement at the design stage can improve construction industry productivity.

New Zealand's building industry suffers from labour shortages, poor productivity issues and lack of effective project delivery. Off-site manufacturing, for example of building panels or modules, can help resolve these issues but it requires the design to be finalised earlier in the process. A conservative market approach and client mindset are also constraints to greater adoption of off-site manufacturing.

Lecturer David Finnie, together with Dr Naseem Ameer Ali from Massey University and Dr Kenneth Park from Aston University, have identified that early contractor involvement can enhance the use of off-site manufacturing. "Early" contractor involvement means involving the contractor during the design phase. This harnesses the contractor's understanding of buildability to inform the design development, and can be done effectively as the first of a two stage procurement process.

From three case studies the research team developed a set of key variables which need to be addressed in a contract for early contractor involvement. These include timing of contractor involvement, the pre-construction services offered, whether or how the contractor is paid for their early involvement, the grounds under which the project may be terminated without proceeding to construction, and what happens in that eventuality. Payment options include the contractor not charging for contributing in the design phase unless the project does not proceed to construction, or the contractor discounting that charge if the project does proceed to construction. 

It is hoped that these key variables will help with preparation of appropriate contract documentation for early contractor involvement, and in turn facilitate the uptake of off-site manufacturing in New Zealand. 

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BUSINESS & MANAGEMENT

February 2018

Image credit: Dan Klar, licensed under CC BY-NC-ND 2.0