Risk and price in the bidding process of contractors

Formal and analytical risk models prescribe how risk should be incorporated in construction bids. However, the actual process of how contractors and their clients negotiate and agree on price is complex, and not clearly articulated in the literature. Using participant observation, the entire tender process was shadowed in two leading UK construction firms. This was compared to propositions in analytical models and significant differences were found. 670 hours of work observed in both firms revealed three stages of the bidding process. Bidding activities were categorized and their extent estimated as deskwork (32%), calculations (19%), meetings (14%), documents (13%), off-days (11%), conversations (7%), correspondence (3%) and travel (1%). Risk allowances of 1-2% were priced in some bids and three tiers of risk apportionment in bids were identified. However, priced risks may sometimes be excluded from the final bidding price to enhance competitiveness. Thus, although risk apportionment affects a contractor’s pricing strategy, other complex, microeconomic factors also affect price. Instead of pricing in contingencies, risk was priced mostly through contractual rather than price mechanisms, to reflect commercial imperatives. The findings explain why some assumptions underpinning analytical models may not be sustainable in practice and why what actually happens in practice is important for those who seek to model the pricing of construction bids.

A multicriteria lifespan energy efficiency approach to intelligent building assessment

This paper presents a multicriteria decision-making model for lifespan energy efficiency assessment of intelligent buildings (IBs). The decision-making model called IBAssessor is developed using an analytic network process (ANP) method and a set of lifespan performance indicators for IBs selected by a new quantitative approach called energy-time consumption index (ETI). In order to improve the quality of decision-making, the authors of this paper make use of previous research achievements including a lifespan sustainable business model, the Asian IB Index, and a number of relevant publications. Practitioners can use the IBAssessor ANP model at different stages of an IB lifespan for either engineering or business oriented assessments. Finally, this paper presents an experimental case study to demonstrate how to use IBAssessor ANP model to solve real-world design tasks.

Barriers and commitment of facilities management profession to the sustainability agenda

The practice of sustainable facilities management (FM) is rapidly evolving with the increasing interest in the discourse of sustainable development. This paper examines a recent survey of the experiences of facilities managers in the rapidly growing and evolving industry in regard to the barriers and their commitment to the sustainability agenda. The survey results show that time constraints, lack of knowledge and lack of senior management commitment are the main barriers for the implementation of consistent and comprehensive sustainable FM policy and practice. The paper concludes that the diversity of the FM role and the traditional undervaluation of the contribution it makes to the success of organisations are partially responsible for lack of success in achieving sustainable facilities. The overwhelming barrier for sustainable FM practice is the lack of understanding, focus and commitment of senior executives in appreciating the opportunities, threats and need for strategic leadership and direction in driving essential change, and hence further the sustainability agenda.

The influence of office location on commuting behaviour

To fully appreciate the environmental impact of an office building, the transport-related carbon dioxide (CO2) emissions resulting from its location should be considered in addition to the emissions that result from the operation of the building itself. Travel-related CO2 emissions are a function of three criteria, two of which are influenced by physical location and one of which is a function of business practice. The two spatial criteria are, first, the location of the office relative to the location of the workforce, the market, complementary business activities (and the agglomeration benefits this offers) and, second, the availability and cost of transport modes. The business criterion is the need for, and therefore frequency of, visits and this, in turn, depends on the requirement for a physically present workforce and face-to-face contact with clients. This paper examines the commuting-related CO2 emissions that result from city centre and out-of-town office locations. Using 2001 Census Special Workplace Statistics which record people’s residence, usual workplace and mode of transport between them, distance travelled and mode of travel were calculated for a sample of city centre and out-of-town office locations. The results reveal the extent of the difference between transport-related CO2 emitted by commuters to out-of-town and city centre locations. The implications that these findings have for monitoring the environmental performance of offices are discussed.

Future cities: urbanisation and the impact on the construction & property sector

The Westminster Sustainable Business Forum (WSBF) has compiled a collection of expert essays on the topic of ‘sustainable construction’ contributed to by industry, policy-makers, and specialists from academia.

Discerning policy and drivers for sustainable facilities management practice

Due to the changing nature of the facilities management (FM) profession, facilities managers are increasingly engaged with the evolving sustainability agenda in the UK and the development or uptake of sustainability policies within their organisations. This study investigates how facilities managers are engaging with the sustainability agenda and the drivers, policy issues and information they use to improve their sustainability performance management. A web based self-administered questionnaire survey of facilities managers in the UK was conducted to identify drivers and issues that influence and support good sustainable practices. A total of 268 facilities managers responded. The results indicate that legislation is the most important driver for the implementation of sustainable practices. Corporate image and Organisational ethos are also recognised. However demand for efficient monitoring, management and reporting on environmental impact is not highly rated even though the top three issues of sustainability managed by facilities managers are energy management, waste and recycling management and carbon footprint. In addition, facilities managers are expected to take ownership of activities assigned to the reduction of carbon emission. Government industries and organisation with high turnover are more likely to have a sustainability policy. Financial constraints are the main barriers while legislations are the main driver for implementing sustainability. For non-profit organisations and the charitable sector, financial constraints are no hindrance to implementing a sustainability policy. The conclusion drawn is that sustainability agendas continue to be influenced by regulated environmental issues rather than a balanced approach which takes into consideration the wider social and economic aspects of sustainability. While this scenario is far from ideal, the expectation is that the organisation will trust FM to take a vital role in delivering a comprehensive sustainability policy due to the rising tide of legislation, public scrutiny, as well as the needed business case for genuinely embracing sustainability. However, as the integration of sustainability with core business strategies is continuously evolving the emphasis on different drivers will vary from organisation to organisation as well as the responsibilities of facilities managers.

The practice of sustainable facilities management: Design sentiments and the knowledge chasm

The construction industry with its nature of project delivery is very fragmented in terms of the various processes that encompass design, construction, facilities and assets management. Facilities managers are in the forefront of delivering sustainable assets management and hence further the venture for mitigation and adaptation to climate change. A questionnaire survey was conducted to establish perceptions, level of commitment and knowledge chasm in practising sustainable facilities management (FM). This has significant implications for sustainable design management, especially in a fragmented industry. The majority of questionnaire respondents indicated the importance of sustainability for their organization. Many of them stated that they reported on sustainability as part of their organization annual reporting with energy efficiency, recycling and waste reduction as the main concern for them. The overwhelming barrier for implementing sound, sustainable FM is the lack of consensual understanding and focus of individuals and organizations about sustainability. There is a knowledge chasm regarding practical information on delivering sustainable FM. Sustainability information asymmetry in design, construction and FM processes render any sustainable design as a sentiment and mere design aspiration. Skills and training provision, traditionally offered separately to designers and facilities managers, needs to be re-evaluated. Sustainability education and training should be developed to provide effective structures and processes to apply sustainability throughout the construction and FM industries coherently and as common practice.

Sustainable land management and development: the role of the chartered surveyor

Despite the growing intensity of the debate about environmental management, it is only recently that rural practice surveyors have become aware of its significance and potential. Consequently, few surveyors are yet in a position to offer professional advice, despite evidence from the RICS's client needs survey that nearly half of all existing clients require more advice on environmental matters. As a prerequisite to becoming involved in environmental management, it is clear that chartered surveyors have to develop new skills alongside new perceptions of their work. Rather than being conterminous, however, the alignment of these attributes reflects a fundamental tension. This is focused on the dichotomy between the strategic construction of the environment as a basis for realigning corporate policy and the more limited evocation of environmentalism as potential new business. This paper seeks to explore the nature and policy context of sustainable development, in the process examining its significance for rural chartered surveyors. In doing so, the paper will seek to contrast the essentially anthropocentric utilitarianism of surveyors' current attitudes with the radical agenda inferred by a more ecocentric, sustainable development approach to professional management and advice. The paper will conclude with a discussion about how far the principles of sustainable development can be incorporated into the management of surveying businesses, and what this implies for the future of the rural practice chartered surveyor as land manager.

Is there a demand for sustainable offices? An analysis of UK business occupier moves (2006–2008)

‘Sustainable’ or ‘green’ commercial buildings are frequently seen as a growth sector in the property investment market. This research examines the emergence of sustainable commercial buildings in both the UK and overseas. The empirical part of the paper is based on a telephone survey of 50 UK corporate (private sector) occupiers taking leased and owner–occupied office space, which was carried out during the period of April to November 2008. The survey focused on actual moves made within the previous two years, or moves that were imminent during 2006–2008. The research suggests that although there is an emerging and increasing demand for sustainable offices in the UK, other factors such as location and availability of stock continue to remain more important than sustainability in determining occupiers’ final choice of office. Occupiers who moved to a Building Research Establishment Environmental Assessment Method (BREEAM)‐rated building, and were in business sectors with strong environmental and corporate responsibility policies, placed more emphasis on sustainability than other groups in the final choice of office, but location and availability remained paramount.