Specialist trade contracting: a review

This book is designed to promote a positive approach to the good management of the relationships between clients, designers, contractors and specialist trade contractors. It covers the integration of specialist contractor design into the overall design; the influences of production processes on design; and management.

Risk under performance-based contracting in the UK construction sector

As a method of procuring the services of the built environment, performance-based contracting (PBC) seeks to link the building supplier to longer term commitments than has traditionally been the case in the construction sector. By rewarding the building producer according to the way that building or structure delivers the users' requirements, rather than according to a list of assembled parts, a number of additional risks are taken by contractors, including fitness for purpose, costs and briefing. The extent to which contractors recognize these risks and their methods of dealing with them vary considerably and are influenced by their attitudes towards risk. As the risks associated with PBC are seen as large, uninsurable, and vulnerable to changing client requirements, the majority of respondents would reject the use of PBC as a method of contracting. Nevertheless, PBC may be used under particular conditions, where rewards are deemed sufficient to compensate for the additional risk to the contractor of undertaking work on the basis of a stream of payments paid over the life of a structure depending on the satisfactory performance of the building or as part of a private finance initiative.

Ownership rights in performance-based contracting: A case study of English law

Clients and contractors need to be aware of the project’s legal environment because the viability of a procurement strategy can be vitiated by legal rules. This is particularly true regarding Performance-Based Contracting (PBC) whose viability may be threatened by rules of property law: while the PBC concept does not require that the contractor transfers the ownership in the building materials used to the client, the rules of property law often lead to an automatic transfer of ownership. But does the legal environment really render PBC unfeasible? In particular, is PBC unfeasible because contractors lose their materials as assets? These questions need to be answered with respect to the applicable property law. As a case study, English property law has been chosen. Under English law, the rule which governs the automatic transfer of ownership is called quicquid plantatur solo, solo credit (whatever is fixed to the soil belongs to the soil). An analysis of this rule reveals that not all materials which are affixed to land become part of the land. This fate only occurs in relation to materials which have been affixed with the intention of permanently improving the land. Five fictitious PBC cases have been considered in terms of the legal status of the materials involved, and several subsequent legal questions have been addressed. The results suggest that English law does actually threaten the feasibility of PBC in some cases. However, it is also shown that the law provides means to circumvent the unwanted results which flow from the rules of property law. In particular, contractors who are interested in keeping their materials as assets can insist on agreeing a property right in the client’s land, i.e. a contractor’s lien. Therefore, the outcome is that English property law does not render the implementation of the PBC concept unfeasible. At a broader level, the results contribute to the theoretical framework of PBC as an increasingly used procurement strategy.

Gene expression profiling of human hibernating myocardium: Increased expression of B-type natriuretic peptide and proenkephalin in hypocontractile vs normally-contracting regions of the heart

A greater understanding of the molecular basis of hibernating myocardium may assist in identifying those patients who would most benefit from revascularization. Paired heart biopsies were taken from hypocontractile and normally-contracting myocardium (identified by cardiovascular magnetic resonance) from 6 patients with chronic stable angina scheduled for bypass grafting. Gene expression profiles of hypocontractile and normally-contracting samples were compared using Affymetrix microarrays. The data for patients with confirmed hibernating myocardium were analysed separately and a different, though overlapping, set (up to 380) of genes was identified which may constitute a molecular fingerprint for hibernating myocardium. The expression of B-type natriuretic peptide (BNP) was increased in hypocontractile relative to normally-contracting myocardium. The expression of BNP correlated most closely with the expression of proenkephalin and follistatin 3, which may constitute additional heart failure markers. Our data illustrate differential gene expression in hypocontractile and/hibernating myocardium relative to normally-contracting myocardium within individual human hearts. Changes in expression of these genes, including increased relative expression of natriuretic and other factors, may constitute a molecular signature for hypocontractile and/or hibernating myocardium.

Communities of practice in UK large contracting firms: contrasting application and non-utilized merits

The idea of a community of practice (CoP) has been offered as the engine to unlock the potential of organizational resources, mainly knowledge and people, to achieve the strategic goal of sustained competitiveness. The relevance and application of CoPs in large UK contracting companies was investigated using two case studies. Contrasting variations in the understanding of the concept between the two contracting companies were observed. While a CoP was applied in one company with strategic intent, the concept was not fully understood in the other. In one company, only a third of CoP members surveyed agreed that CoPs were a vehicle for driving best practice and innovation throughout the business; this compared with more than 60% in agreement in the other contracting firm. The higher agreement and satisfaction of CoP members in the latter case study was the result of the management's understanding and commitment. CoPs require time and organizational support to mature. The strategic inception and management support of CoP application is vital for their maturation and progress. Although the construction industry change discourses portray CoPs as fostering an environment of trust, and hence serving as innovation and competiveness enablers, their potential contribution to contracting firms does not provide a compelling case and hence merits further research studies.

Performance-based contracting in the construction sector

Construction procurement is complex and there is a very wide range of options available to procurers. Inappropriate choices about how to procure may limit practical opportunities for innovation. In particular, traditional approaches to construction procurement set up many obstacles for technology suppliers to provide innovative solutions. This is because they are often employed as sub-contractors simply to provide and install equipment to specifications developed before the point at which they become involved in a project. A research team at the University of Reading has developed a procurement framework that comprehensively defines the various options open to procurers in a more fine-grained way than has been known in the past. This enables informed decisions that can establish tailor-made procurement approaches that take into account the needs of specific clients. It enables risk and reward structures to be aligned so that contracts and payment mechanisms are aligned precisely with what a client seeks to achieve. This is not a “one-size-fits-all” approach. Rather, it is an approach that enables informed decisions about how to organize individual procurements that are appropriate to particular circumstances, acknowledging that they differ for each client and for each procurement exercise. Within this context, performance-based contracting (PBC) is explored in terms of the different ways in which technology suppliers within constructed facilities might be encouraged and rewarded for the kinds of innovation sought by the ultimate clients. Examples from various industry sectors are presented, from public sector and from private sector, with a commentary about what they sought to achieve and the extent to which they were successful. The lessons from these examples are presented in terms of feasibility in relation to financial issues, governance, economics, strategic issues, contractual issues and cash flow issues for clients and for contractors. Further background documents and more detailed readings are provided in an appendix for those who wish to find out more.

Nexus between contracting and construction professional service businesses: empirical evidence from international market

he construction market around the world has witnessed the growing eminence of construction professional services (CPSs), such as urban planning, architecture, engineering, and consultancy, while the traditional contracting sector remains strong. Nowadays, it is not uncommon to see a design firm taking over the work of a traditional main contractor, or vice versa, of overseeing the delivery of a project. Although the two sectors of contracting and CPS share the same purpose of materializing the built environment, they are as different as they are interrelated. Much has been mentioned about the nexus between the two but little has been done to articulate it using empirical evidence. This study examined the nexus between contracting and CPS businesses by offering and testing lead-lag effects between the two sectors in the international market. A longitudinal panel data composed of 23 top international contractors and CPS firms was adopted. Surprisingly, results of the panel data analyses show that CPS business does not have a significant positive causal effect on contracting as a downstream business, and vice versa. CPS and contracting subsidiaries, although within the same company, do not necessarily form a consortium to undertake the same project; rather, they often collaborate with other CPS or contracting counterparts to undertake projects. This paper provides valuable insights into the sophisticated nexus between contracting and CPS in the international construction market. It will support business executives’ rational decision making for selecting proper contracting or CPS allies, or a proper mergers and acquisitions strategy in the international market. The paper also provides a fresh perspective through which researchers can better investigate the diversification strategies adopted by international contracting and CPS firms.

Ion flows and heating at a contracting polar-cap boundary: GISMOS observations indicating viscous-like interaction on the flanks of the magnetotail

This paper complements that in this issue by Clauer et al. concerning the international GISMOS campaign of 3–5 June 1987. From a detailed study of the EISCAT data, the polar-cap boundary, as defined by an almost shear east-west convection reversal, is found to contract across the EISCAT field of view between 04 and 07 MLT. An annulus of enhanced ion temperature and non-thermal plasma is observed immediately equatorward of the contracting boundary due to the lag in the response of the neutral-wind pattern to the change in ion flows. The ion flow inside the polar cap and at the boundary is shown to be relatively smooth, compared with that in the auroral oval, at 15-second resolution. The flow at the boundary is directed poleward, with velocities which exceed that of the boundary itself. The effect of velocity shears on the beamswinging technique used to derive the ion flows has been analysed in detail and it is found that spurious flows across a moving boundary can be generated. However, these are much smaller than the observed flows into the polar cap and cannot explain the 7 kV potential difference across the observed segment of the cap boundary between 04:30–06:30 UT. The ion temperature enhancements at the two observing azimuths is used to define the boundary orientation. The results are consistent with recent observations of slow anti-sunward flow of closed field lines on the flanks of the geomagnetic tail, which appears to be generated by some form of “viscous” coupling to the magnetosheath plasma.

Ion flows and heating at a contracting polar-cap boundary

Data recorded by the POLAR experiment run on the EISCAT radar during the international GISMOS campaign of 3–5 June 1987 are studied in detail. The polar-cap boundary, as denned by an almost shear East-West convection reversal, was observed to jump southward across the EISCAT field of view in two steps at 02:00 and 03:00 Magnetic Local Time and subsequently to contract back between 04:00 and 07:00 M.L.T. An annulus of enhanced ion temperature and non-thermal plasma was observed immediately equatorward of the contracting boundary due to the lag in the response of the neutral-wind pattern to the change in ion flows. The ion flow at the boundary is shown to be relatively smooth at 15 s resolution and directed northward, with velocities which exceed that of the boundary itself. The effect of velocity shears on the beamswinging technique used to derive the ion flows is analyzed in detail and it is shown that, for certain orientations of the cap boundary, spurious flows into the cap can be generated. However, these are much smaller than the observed flows into the polar cap and cannot explain the potential difference across the observed segment of the cap boundary (extending over 2 h of M.L.T.) which is roughly 7 kV. Similarly, an observed slowing of the zonal flow near the boundary cannot be explained as an error introduced by the use of the beamswinging technique. The results could be interpreted as being due to reconnection occurring on the dawn flank of the magnetopause (mapping to the polar cap at 04:30 06:30 M.L.T.). However, they are more consistent with recent observations of slow anti-sunward flow of closed field lines on the flanks of the geomagnetic tail, which appears to be generated by some form of “viscous” coupling to the magnetosheath plasma.

Identifying appropriate construction procurement strategies

The origins of the various procurement methods in construction are considered, followed by a discussion of the circumstances for which each procurement system is best suited. The likely future development sin management-based methods are discussed in the context of current research, showing that co-ordination of trade and specialist contractors , more flexible contracting, constructive conflict management and a potential polarization of views about project management in the industry are likely.

Construction subcontracts: for what we are about to receive

This paper is from a study on specialist and trade contracting in the construction industry. The research was commissioned by CIRIA and undertaken by the University of Reading in conjunction with Sir Alexander Gibb & Partners Ltd. The purpose of the work was to provide guidance for effective and equitable practice in the management of projects where much of the work is executed, and possibly designed, by specialist and trade contractors (STCs). As part of this study, a preliminary investigation into the nature and origins of specialist contracting was undertaken, in conjunction with a survey of the problems confronting STCs. This paper presents that phase of the project.

A preliminary survey of attitudes to UK construction procurement practice

Although much literature on construction procurement is based on personal experiences, there is little data available to undertake realistic comparison between regions or from one year to another. A survey was undertaken in the UK to examine the feasibility of developing a replicable survey technique that will enable longitudinal studies and international comparisons. The survey showed that a majority felt traditional procurement methods were inappropriate. However, traditional general contracting is still the most common form of procurement. There was strong agreement that economic muscle compels weaker contracting parties to accept onerous contractual terms. There is no relationship between the size of a project and its procurement method, contrary to popular belief. The findings indicate that wider surveys would generate useful data about attitudes.