Civil Engineering Reference
In-Depth Information
setting up supply chains. However, King and Pitt (2009) point out that
only a few clients have the size and repeat business to offer main con-
tractors the incentive to collaborate with their supply chain, so as to
allow their employers to determine the nature of their relationships
with their subcontractors and the supply chain.
It is therefore not surprising that Dainty, Briscoe and Millet (2001)
found mistrust and scepticism amongst subcontractors and went on to
suggest that leading clients need to take the initiative if this barrier to
improved working is to be overcome. That is precisely what occurred
on the London 2012 programme, and this topic describes the techniques
and tools that were used to obtain improvements in the supply chain.
King and Pitt (2009) state that supply chain management needs to take
into account specifi c issues surrounding the industry, the client, suppli-
ers and organisational factors. More specifi cally, they suggest developing
the supply chain through the use of meetings, seminars and internal key
performance indicators, with a view to developing trust, commitment,
integrity and fl exibility in the supply chain. They also see certain cul-
tural values as necessary elements in a supply chain. These include a
strategy for continuous improvement, health and safety standards and
the early involvement of subcontractors. If these outcomes for the tier
1 and 2 fi rms in the supply chain are to be achieved, they require a
number of detailed techniques, which are brought together by the PSE
approach described in this topic.
Simply winning at the expense of the other party (as in a zero-sum
game) is not always the most desirable outcome, even for the winner.
Depriving a supplier of profi ts may mean that the supplier drops out of
the supply chain to the detriment of the programme, and means that it
ceases to compete with other potential suppliers in the future. This
increases the market power of the remaining suppliers in future tenders
for the same client. Nevertheless, Cox (2009) argues that the majority
of transactions involve zero-sum games with risks for both sides. As a
result it is important to recognise that the management of projects is
not about ignoring differences between clients and tier 1 contractors, or
between tier 1 contractors and tier 2 contractors, but managing risks to
avoid the most severe adverse consequences for all parties. It is therefore
necessary to recognise the different interests of fi rms in the construction
process and to accommodate these differences in management proc-
esses, as described in later chapters.
Other literature focuses on project management as a purely
construction-phase, on-site activity, such as the Code of Practice for
