Clients within the Construction Industry prefer to utilize the JCT Design & A ; Build Contract instead than other traditional procurances methods. Novation is a procedure that allows Clients to supervise the early phases of design development of a undertaking and so reassign the duty for the design to a Contractor after the contract has been awarded. By reassigning the duty to the Contractor through novation the Client takes minimal hazard contractually while retaining an influence on undertaking design from the initial phases. This procedure transfers maximal hazard to the Contractor as he becomes responsible for all future design of a undertaking and all past design completed up to the point of a contract being awarded, this includes any design mistakes.
Both Contractors and Designers must work together closely on any design and physique undertaking, but peculiarly when novation has taken topographic point. For a undertaking to be profitable and be completed on clip it is indispensable that there is a good working relationship between Contractor and Designer.
Research to set up if the procedure of novation has an inauspicious affect on the working relationship between Contractor and Designer was conducted. The purposes were to place factors that may impact the working relationship of the two parties and to understand the sentiments of both Contractors and Designers about what affect novation has on their working relationship. The aims of the research were to foreground specific jobs within the procedure of novation and urge betterments to industry. To accomplish this research in the signifier of a literature reappraisal, questionnaires and an interview with Contractors and a Designer was performed.
The study recommendations are aimed at Clients to keep more pre-contract meetings with Contractors non merely Designers, and understand the standards a Contractor follows when naming a Designer to guarantee compatibility between parties when in Design and Build contract together.
I would wish to show gratitude to the undermentioned people and administrations for their clip, cognition and support in helping the in the successful completion of this research undertaking:
- My concluding twelvemonth Supervisor Dr Ron Craig of the Civil and Building Engineering Dept of Loughborough University, for constructive unfavorable judgment and counsel throughout the procedure of developing the thesis.
- HBG UK Ltd for utilizing a batch of Commercial Managers ‘ , Design Co-ordinators ‘ , Legal Correspondents ‘ and Personnel ‘s clip in finishing the literature reappraisal and helping in the information aggregation.
- The Commercial Manager of the 2nd Contracting Company questioned
- The Architect questioned for his experience and sentiments of the procedure of novation.
- Mr Andrew Moss for cogent evidence reading the concluding bill of exchange of this study and proposing possible changes.
Chapter 1 – Introduction
1.1 Introduction to Subject
The Design and Build signifier of J.C.T contract ( delight see chapter 4.0 ) has become more popular with building Clients that employ Contractors to build new edifices and/or restitute bing constructions. The Author ‘s research has shown that the per centum of contracts tendered for under a Design and Build signifier of J.C.T has increased over the last five old ages. In concurrence with this the traditional signifier of JCT contract has decreased in popularity with Clients.
In many instances the designs which make up portion of the contract between the Client and Contractor, under JCT Design and Build, are completed by a Design Team on behalf of the Client before the contract between the Client and Contractor is made. To guarantee that the Contractor who successfully stamps for a undertaking retains the Design Consultant that the Client employed prior to the contract being made it is sometimes necessary for a Client to novate( delight see chapter 5 )the design squad across to the Contractor. The intent of this study is to look into into the jobs, if any, with the procedure of novating a design squad to a Contractor from the Client and suggest solutions. This study will besides detail the affects on the working relationship between the Contractor and the Designer, and how novation either AIDSs or hinders the working relationship
1.1.1 Aims of Chapter One
- To present the Dissertation capable country.
- The grounds behind the probe of this Dissertation.
- To sketch the work carried out and a description of the contents of the Dissertation.
- Detail a good constructed hypothesis that the probe will either turn out or confute.
- To sketch a usher to the study, and present each person chapter.
- To detail the purposes of the study and the aim that must be achieved to run into the purposes.
1.2 Rationale behind I nvestigation
The involvement into the probe of “ Are there ever jobs with novating a design squad to a contractor? ” came about after the Author ‘s industrial arrangement. While working on site for a Contractor on a J.C.T. Design and Build contract where the design squad was novated it became evident to the Writer that there were many differences of sentiments between the Designers and the Contracting Company.
The chief points of argument and dissension between the Contractor and the Design Team were the Clients demands. In the Author ‘s experience at that place was a big difference of sentiment of how design alterations and/or fluctuations should be treated between the Design Team and the Contractor.
Whilst profit-driven Contractor seemed to ever look for the cheapest and most cost effectual manner of bridging any design job ; where as the Design Team gave the feeling that they were more concerned about the aesthetics of the design and the Clients design sentiments instead than the buildability and cost.
Many design fluctuations that were requested by the Client, or those forced upon the Contractor were non ever as the Contractor had specified to the Design Team. The Contractor felt that his clip was wasted by the Consultant non planing elements as originally specified. The working relationship between the Contractor and the Designer seemed to deteriorate from the undertaking start day of the month, until beyond the design completion phase.
After the Author had asked other members within the Contracting Company about the novation of a Designer to the Contractor it became evident that the relationship between Contractor and Designer was likewise affected on other undertakings. The Author had treatments with the Client of the undertaking he was placed on. The Client stated that more edifice work was being undertaken utilizing the J.C.T. Design and Build signifier of contract as this reduces the hazard to the client and/or the individual funding the undertaking.
The Author found that under Design and Build more hazard was placed on the Contractor, and that direction techniques had to alter to suitably pull off higher hazard undertakings. He besides realised that as more contracts were being made under the Design and Build signifier of contract with the Designers being novated to work for the contractor a greater cognition of the capable country would be good to the Author in the direction of Design and Build contracts.
1.2.1 Originality of Thought
The Author had treatments with his Supervisor before get downing the research about the capable affair. A hypothesis was agreed upon that gave the Author range to research countries of the procedure of novation in design and construct undertaking that have non antecedently been discussed in an undergraduates research undertaking for the Supervisor. The procedure of novation being used in the design and physique contract has late become popular with Clients. The purpose of the research is to set up if Contractors and Interior designers have non yet to the full adapted to the alteration and betterments in the working relationship between the parties must be made to guarantee that they remain competitory and profitable.
1.3 Capable Definition
Novation is a procedure in which [ 1 ] a contract between party A and party C is turned into a new contract between party B and party C. This procedure can merely be achieved if all three parties agree that novation can take topographic point.
A Deed of Novation [ 2 ] is normally used to end a contract between parties A and B, and so make a new contract between parties A and C. There are standard legal paperss, clean workss of novation, which are available as downloads from the cyberspace, for illustration at ( www.citysolicitors.org.uk/legal_activities as of 28/03/06 ) .
A title of novation has been used for many old ages before it became popular with Clients in the building design and construct context. It is used in the sale of fabrication companies, where constituents made are used by other larger companies. For illustration, the purchase of a windscreen wiper company by a new proprietor whilst retaining the committedness to an bing client auto maker.
Novation has many other wider applications other than building ; Porsche in their latest booklet [ 3 ] offer a novated rental for their new motor autos. In this instance an Employee of a company ( the leaseholder ) marks a rental understanding with Porsche ( the lease giver ) . A Deed of Novation, so supplied by Porsche, is signed by Porsche, the Employee and the Employer. This so transfers the duty for the payment to the Employer.
Novation is used in a building context where the relationship between two parties has developed over clip and the debut of a 3rd or new party is necessary. There so needs to be proviso to contractually protect the bing parties in the relationship.
1.4 Report Intention
The purpose of this study is to look into how the working relationship between the Contractor and the Designer novated to the Contractor from the Client could be improved to their common benefit, and to the benefit of the Client. However, the study may demo that there is no betterment to be made, and that the procedure of novation as it soon stands is equal.
- To place clearly factors that may impact the relationship between the Contractor and the Designer under novation
- To detect any inauspicious features that may do a hapless working relationship between the Contractor and the Designer
- To clearly understand the sentiments of Interior designers and Contractors that has been involved with novation
- To understand the attitudes of Interior designers and Contractors towards novation
- To clearly understand the definition of novation and the context in which it is used within the building industry
- To place any differences in attitudes between Contracting Companies towards novation under a J.C.T. Design and Build contract
- To understand why Clients now prefer to utilize the Design and Build signifier of contract instead than the Traditional contracts they favoured to utilize
- To place why Clients within building novate the Design Team across to the Contractor
- To foreground specific jobs within the procedure of novation that requires bettering
- To look into how the procedure of novation may differ between contracts and/or with varying Clients
- To place differences between the Contractor ‘s and Designer ‘s sentiment of novation under the J.C.T. Design and Build Contract
- To foreground countries within building where it is necessary to utilize novation in Design and Build contracts
- To rede the Contracting Companies of the most economic manner of pull offing a Design Team that has been novated by a Client
- To place if a Contractor and Designer have a better working relationship, i.e. have a greater apprehension of each others aims and demands, under a traditional contract instead than novation under a Design and Build Contract
“ The working relationship between Contractor and Designer is adversely affected by Novation. ”
1.5 Overview of Research Methodology
The methodological analysis of the research for this undertaking will take the signifier of the followers ; please see the methodological analysis in chapter three for a elaborate treatment on the study methods used:
- A reappraisal of past and current literature refering the background of novation within the building industry.
- A reappraisal of specific literature refering the working relationship of a Contractor and Designer.
- Discuss the definition of novation within building, and where it is most normally used in the industry.
- Design a questionnaire to direct out to a selected Contractor and a Designer.
- Design an interview format and inquiries for a specific Contracting Company to reply on the topic of novation.
- Design an interview format and inquiries following the consequences of the old interview to publish a separate questionnaire to a different Contracting Company to analyze company differences.
- Analyse consequences gathered in the interview to organize a decision about the consequence of novation in building.
- Make suggestions or recommendations to the industry and Clients within the building industry.
1.6 Overview of Main Conclusions
The Author ‘s completed research shows that there are 10 factors that could adversely impact the working relationship between a Contractor and a Designer under a novation understanding. The Writer found through analyzing an interview and questionnaires completed by two Contractors and an Architect that the grounds for novation holding an inauspicious influence on the working relationship of a Contractor and Designer were that:
- The clip allowed for Contractor to Tender is non increased
- The trueness of Designer to Client remains apparent after novation to the Contractor
- There is normally a big distance between the Designers caput office and the undertaking
- Insufficient design fees are allocated at the stamp phase
- There is an increased hazard of mistake in design
- There could hold been a antecedently hapless working relationship between the parties
- The Designer may be inappropriate for the undertaking
- The public presentation of the Designer is non consistent throughout the procedure of finishing the design
- Novation is normally late or rushed from the Client
- There is an increased chance of struggle between the two parties
The Author found that many of these factors were specific jobs which could be attributed to the procedure of novation under a design and physique undertaking. Therefore, the consequences support the hypothesis of the research. However, extra research is required if the hypothesis is to be proven to be right.
1.7 Guide to the Report
- Chapter One:Introduction –This subdivision introduces the survey and outlines the hypothesis, purpose and aims of the research. It indicates the beginning of the Author ‘s involvement in the topic, why the hypothesis was chosen, and describes the methodological analysis that was followed.
- Chapter Two:Literature Review –This subdivision examines the literature research conducted by the Author. It is an probe into the definition of novation, and describes where it is used within the building industry. This subdivision inside informations the current position of the contractor in a novation understanding.
- Chapter Three:Methodology –This subdivision of the study describes the methodological analysis which was used to carry on this research. It shows how the information was collected. It besides includes the subjects covered within the interview and the design of questionnaires that were employed.
- Chapter Four:Design and Build Contracts –This subdivision describes the signifiers of J.C.T. contract used and foreground the advantages and disadvantages to the Design and Build signifier of JCT contract. It provides an debut into Design and Build and inside informations the differences between the Employers Requirements and Contractors Proposals that are a cardinal characteristic of the Design and Build contract.
- Chapter Five:Novation –This subdivision of the study describes in item the utilizations of novation within a building context. It gives a definition to the procedure of novation as used in a Design and Build state of affairs. This chapter inside informations the struggle of involvement the Contractor and the Designers tend to see due to novation. It illustrates the jobs that may originate in the design, payment of design fees and the varying degrees of the Consultant ‘s public presentation.
- Chapter Six:Analysis –This subdivision of the study is the analysis of the questionnaires sent to Clients within the edifice industry and their Undertaking Managers and the Designers. It analyses the interviews conducted with the contractors and extra information gathered.
- Chapter Seven:Conclusion –This subdivision of the study presents the Author ‘s decisions based upon the findings within the analysis chapter of the study. It suggests solutions to the purposes and aims set out in the debut, criticises the hypothesis around the study was based and high spots the possibility for farther research.
Chapter 2 – Literature Reappraisal
The literature reappraisal is a comprehensive analysis of all relevant articles, books and publications to this research undertaking.
Derek Swetnam [ 4 ] describes the literature reappraisal as a study ;
That is cardinal to the thesis and in all manners of work it has a figure of maps:
- It shows that you have read widely around your chosen subject
- It demonstrates your critical apprehension of the theory
- It acknowledges that work of others
- It informs and modifies your ain research
The Literature reappraisal in this chapter is broken down into eight sub-headings. The chapter negotiations about the description of novation, so goes on to depict where novation is used today both in and outside the building industry. The literature reappraisal describes the procedure of a Designer being novated to a Contractor. The concluding subdivision of this chapter discusses and analyses in what manner the literature which is reviewed is relevant to the Author ‘s research undertaking.
2.1.1 General Aims
- To interrupt down the causes of the job highlighted in the hypothesis into logical phases.
- To roll up and analyze old research and literature to farther look into the capable country of this undertaking.
- To research any antecedently made recommendations.
- Make recommendations which have been concluded from a elaborate literature reappraisal.
2.2 Aim of This Literature Review
- What is the description of Novation and in what context was it used before in building?
- Where is Novation used today outside of building and what is its chief intent?
- What other utilizations are at that place of Novation within building other than a Designer being novated to a Contractor?
- When did Novation of a Designer to Contractor go popular with Clients in the building industry?
- Have there been jobs with the novation of a Design squad to a Contractor in the yesteryear?
- When is Novation practical in building contracts?
- What are the hazards to the Contractor in the novation procedure?
2.3 Contentss of Literature Review
2.3.1 Description of Novation
David Janssens [ 5 ] stated that:
Occasionally, an Employer may qualify that the successful Contractor is to prosecute one or more of the Employer ‘s advisers to finish the design and particularization of the undertaking in the post-contract phase. Such advisers are employed by Contractors under ‘novation understandings ‘ , i.e. a ‘novation ‘ understanding is a new understanding in permutation of a old understanding between the Consultant and the Employer.
Novation exists when an understanding or contract between two parties is traveling to be broken and a 3rd party enters to take the topographic point the agreed or contract function of the party which is go forthing the understanding or contract.
Novation can besides be when a 3rd party enters into an understanding or contract without any other party go forthing.
Jeremy Hackett [ 6 ] stated that:
“ Novation ” is a legal construct, officially supplying for the re-employment of a Consultant by the Contractor, as portion of the contract understanding between the Employer and Contractor. Should the Contractor simply choose to re-employ the same persons who have antecedently sat the other side of the interview tabular array from himself that would non be novation, but its consequence would be really similar.
2.3.2 Uses for Novation.
Novation is non merely used within the building industry, the usage of novation in jurisprudence is much more normally used in the purchasing and merchandising of fabricating companies. In this context a novation understanding possibly drawn up by attorneies of a fabrication company which intends to sell to purchaser whilst still retaining the same concern patronage. In this case a client of the concern being sold would be novated across to the new purchaser of the concern, this ensures that the client can ever beginning what of all time item the new purchaser industries.
Ann Arbor [ 7 ] Stated that:
A infirmary in Texas is taking electronic commercialism beyond purchase orders and use studies to acceptance of digital contract direction. The Oklahoman infirmaries are able to subscribe up to take part in new contracts, the Oklahoman they are able to entree contract pricing. Using the enhanced form direction plan, stuffs directors can subject signifiers online where providers can O.K. them, besides online.
In this illustration a infirmary in Texas is utilizing the understanding of novation over the cyberspace to subscribe up for new contracts much faster than it was able to antecedently.
This has benefited stuffs directors the most as they are able to beginning cheaper or higher quality stuffs from differing providers and merely reassign the understanding they have with one provider to another utilizing novation.
2.3.3 Alternate utilizations of Novation within building.
The subdivision above discusses how different signifiers of novation are implemented in countries other than the building industry. However, within the kingdom of building there are many more utilizations for the novation understanding to be used. The usage of novation within building has merely been normally used during the past decennary or so, the chief ground for this is the debut of the JCT Design and Build Contract which made the novation of Designer to the Contractor much easier for the Client.
Before the debut of Design and Build Contract novation was present in the same format it exists today in other industries as mentioned above. If during the building procedure a Client was unable to fund any farther necessary plants and there was a willing purchaser to stand in for the Client, it may be in the involvement of the come ining party to go on to utilize the bing Contractor. The easiest and least clip devouring manner to make this would be utilizing the Novation understanding.
The 2nd manner in which novation occurred in a building context before the debut of the Design and Build Contract was if the Contractor was enduring from fiscal issues or the relationship between himself and the Client has been irreparably affected in someway. If a state of affairs like this occurred it was good for the Client to take on board a new Contractor through a novation understanding. This removed the necessity for the staying plants to be re-tendered, and the likeliness that the Client would hold to pay an surplus for the plants to be completed.
2.3.4 When did novation go popular with Clients
Jim Smith [ 8 ] stated that:
The pick of a procurance method is likely the individual most of import determination the client makes, other than the determination to construct. The assorted procurement methods can be described, as defined by Masterman ( 2002 ) , under these three distinguishable classs:
- Separated and co-operative.
- Management orientated.
In the last few old ages and peculiarly within the past decennary the procurance methods for contractors have been traveling off from the more traditional contracts as described above.
The alteration to a procurance method which uses the 2nd and 3rd classs above has mostly been Client-driven ; the chief ground for this is that the Contractor has to accept a high degree of hazard if he is to tender successfully for a undertaking. As more design development has been shifted across to the Contractor it is going easier and more cost effectual for the Client to switch higher degrees of hazard to the Contractors. The Design and Build contract and all its fluctuations have expanded well to suit a Client ‘s demands in recent times.
The Royal Institution of Chartered Surveyors ( RICS ) [ 9 ] in 2000 stated that:
Design and physique and its fluctuations have expanded well in the last decennary.It has increased dramatically in the 1990s traveling from a 10 per centum portion during the 1980s up to a 35 per centum portion of the building procurance market, with direction undertaking worsening to a 10 per centum portion.
Chan stated [ 10 ] that:
21 % of private Clients in the UK use the Design and Build system, of which 42 % normally use Design-Novate and Construct for their undertakings. Design-Novate and Construct has besides been widely adopted inAustraliaandHong Kong.
David Jaggar [ 11 ] Stated that:
The major advantages of design and physique are that all the hazards, both fiscal and period for completion, are transferred to the design and build contractor, with the client merely covering with one administration, so extinguishing the complexnesss and defeats of covering with a scope of separate administrations. The attack besides overcomes the job of the separation of design and building, so salvaging overall clip and leting the design to reflect improved buildability in the building solution.
The statement against this is that a Contractor may be taking a higher per centum of higher hazard undertakings. However, as a Client is off lading a batch more hazard than what was traditionally non possible in the yesteryear they are able to fund much more undertakings and prosecute a batch more interior decorators. The consequence of this is that the Contractor has more work to tender for and a much higher opportunity of winning undertakings as more stamps will be processed.
2.3.5 Issues originating from utilizing Novation in building.
Jim Smith [ 12 ] stated that:
There is considerable argument as to the virtues and demerits of the attack and it is just to state that many design professionals were unhappy about the attack, non least because there was a decrease in their ain influence and independency. However, a valid position put frontward, which doubtless design and construct suffered from in the 1980s, was that the quality of the concluding edifice was frequently inferior and the function of design was devalued, as the design and physique contractors “ shaped ” the design to accommodate their peculiar methods of building. More recent positions from clients noted above indicate that they were satisfied with the quality of their completed design build undertakings.
The Design Manager of a Contracting Company plays a critical function in the development of design to find a contract value for a undertaking. The function involves being able to equilibrate cost and quality and clip restraints within a model. This is an indispensable accomplishment for all Design Managers or Project Co-ordinators. The Design Manager will work closely with the Commercial Manager at the stamp phase of a Design and Build contract when novation of the Design squad is being used by the Client. It is important that both directors work together to cut down the sum of design and fiscal hazard the contractor will hold to transport through the contract period if the stamp entry is to be successful.
Allinson [ 13 ] provinces that:
The developments in the building industry, the go oning specialization of professions and the lifting application of alternate procurance methods have all contributed to the spread between design and direction, but they have besides emphasised the demand for a design professional with direction and technological accomplishments. The direction of the procedure should guarantee a successful and deliverable undertaking
When Design and Build contracts foremost became widely used by Clients in the 1990 ‘s Contractors tended to pull off the edifice works in the same manner they managed traditional contracts. Here a Undertaking Manager was responsible for the development of the building and reasoning the outstanding design issues every bit good as deciding any edifice sites daily issues. Undertaking Managers were supported by a figure of other directors such as Services Engineers, Site Management and Quantity Surveyors.
Jim Smith [ 14 ] provinces that:
However, a individual coverage beginning on all facets of design and cost has non ever benefited the client, contractor or the undertaking. Undertakings have been organised in a really “ level ” construction with legion lines of duty describing straight to the undertaking director. The larger undertakings would hold over half a twelve separate cabals straight beneath the undertaking director, including the above stated directors, construction coordinators, certification directors, tendering coordinators, contract disposal, project disposal and business wellness safety and rehabilitation ( OHS & A ; R ) . In pattern, this construction has proved to be an inefficient and uneffective signifier of direction on many undertakings…
He continues to state that:
With the laterality of design and concept contracts, the direction of the design and development of undertakings is indispensable to enable successful procurance and fast trailing. However, its failing is in the direction of design and cost during design development and the deficiency of apprehension of how to accomplish good design, to the expected quality and within budget parametric quantities. The failing is aggravated by the perceptual experience of the design cost control map holding the individual focal point on “ cost film editing ” and non on value execution.
The guidelines which a Contractor should follow before come ining into an understanding with a possible Client are discussed farther in this literature reappraisal. A Contractor will hold in house guidelines demoing how to interview and addition information from Designers to make up one’s mind if it is deserving puting the clip, attempt and disbursal in a undertaking that if won, would ensue in a greater fiscal loss.
If this procedure is non conducted right or if any high hazard points are overlooked in order to win a undertaking a Contractor may happen himself in tribunal in an effort to deliver his fiscal losingss caused by hapless design by the Advisers.
2.3.6 When is Novation Practical.
Thomas and Skitmore [ 15 ] State that:
Design, Novate and Construct contracts are more appropriate when:
- The clip for completion of the undertaking is ‘of the kernel ‘
- The budget for the undertaking is fixed and excess resources of support are really limited
- The undertaking involves particular design and proficient demands.
Procuring a building undertaking and edifice it within the clip set, to come in on budget to guarantee quality and to diminish the hazard are the premier aims of the Client. Despite increasing quality criterions and the overall complexness of new edifice undertakings, less clip and money is being allocated to the design, planning and command phases of a undertaking.
Novation of a design squad is practical when the Client is able to contract a builder into accepting more hazard than he would experience usually comfy taking. Recent market conditions, low involvement rates, ferocious competition within Contracting and the debut of the JCT Design and Build contract giving Clients the chance to novate Designers has enabled Clients to utilize novation to their advantage.
It is neither possible nor practical for Employers to enforce such a status in all assortments of Design-Build, as the tabular array, by Janssens [ 16 ] shows:
Novation of Advisers and the different assortments of Design-Build.
Assortment of Design-BuildRemark
Develop and ConstructMost common assortment where novation is applied.
Design-BuildNovation frequently suggested by Employer, but
( Single-Stage Tender )Contractors should take attention.
Design-BuildBy definition novation is non possible.
( Two-Stage Tender )
( Design completition )
Negotiated Design-BuildPossible, but in this instance it would normally be a ‘named ‘
& A ; Design & A ; Manage.Consultant, in that the employer would be improbable to
hold already entered into an understanding with the Consultant.
Prison guardNovation would non usually be applicable
2.3.7 Problems with the novation procedure.
Before a Contractor accepts the infliction of a novated design squad he should travel through a process of look intoing that both he and the Designers to be novated will be able to work together fruitfully from the tendering facet to the completion of the design and the completion of the building procedure. If the Contractor feels that the relationship between him and the Designer will non be a fruitful one so the Contractor may be better off worsening the chance for tendering.
An option to this is for the Contractor to near the Client and make an understanding to relinquish the status of novation. This may be in the involvement of the Client every bit good as the Contractor in the long tally ; some Clients approached by a Contractor who besides offer an alternate Interior designer have been awarded contracts.
Before come ining into an understanding of novation with a Client the Contractor must fulfill themselves that they will be able to hold confidential entree to the advisers to be novated during the whole tendering procedure. This may be hard for the Client as cardinal designs possibly completed to give fiscal additions to the Contractor. Normally more than one Contractor may tender for one contract and the client could happen a huge difference in monetary value and differences in the design development between Contractors tendering for one undertaking.
David Janssens [ 17 ] provinces that:
In this state of affairs the contractor should seek replies to the undermentioned points, as a lower limit:
- There will be many proposals and inside informations that the Contractor will desire his Interior designers to see, and so the Contractor must look into on what agreements have been made to let clip for such treatments.
- How will any advanced proposals be kept confidential?
- What will be the Consultant ‘s attitude to Contractor ‘s alternate proposals derived during the stamp period, and will the Consultant be prepared to work-up such thoughts?
- Will the Consultant be able to give sufficient clip with the Contractor at the decision of the stamp period for elaborate cheques for mistakes and skips, and aid with the hazard appraisal?
If a Contractor is able to fulfill himself that all the points above have been answered in sufficient item so they may experience confident that all hazard has been allowed for and that a stamp entry could be executable. If all the points are satisfied so the Contractor should be confident about come ining into a novation understanding with the Client.
2.3.8 The hazards to the Contractor in the novation procedure
When a Designer is novated to a Contractor by a Client this brings much more hazard than other procurement methods. Under novation it is non the Client that is responsible for the design of the undertaking and the Contractor has non been in control of the design from the initial phases. This increases hazard as it is the Contractor who is responsible to look into the designs of the undertaking whilst under a deadline to return a stamp command.
By utilizing novation the Client can acquire the best of both the traditional and design and physique contracts. The Client has control over the design at the initial phases of the undertaking and can develop the design as he wishes as he would in a traditional contract. But he besides transfers the hazard of design mistake and ensures better cost control with fewer fluctuations, a cardinal characteristic of the design and build manner of contract.
Thomas and Skitmore [ 18 ] describe the Contractors ‘ hazards in the novation procedure as follows:
- The novated Design Team ‘s ability to execute
- The deficiency of Design Team ‘s fees allocated to the post-novation stage
- Working relationships with the novated design squad
- The timing of the novation.
Much research has gone into the reading around the topic of novation as this literature reappraisal shows. The debut of the Design and Build Contract has benefited U.K. Clients within the edifice industry particularly in the past 10 old ages because of the usage of the novation understanding.
Recently due to the competitory building market it has been the Contractors which have had to take duty for most of the hazards which would hold traditionally been the duty of the Client.
A novation understanding between a Client and Contractor for the Design squad should in theory work ; but it is the duty of the Contractor to foremost interview the Consultants that are to be novated to him and guarantee that a fruitful working relationship for the continuance of the undertaking.
The literature reappraisal shows that jobs occur when there is a dislocation in communicating between the Contractor and Designer ensuing in designs staying incomplete or non being developed harmonizing to the Contractors budget. As the bulk of hazard is placed onto the Contractor the Client could be expected to pay a small excess on the contract value as designs are uncomplete by as up to 70 % .
The Client has to anticipate a monetary value addition because of hazard added to certain elements of the building. However, the monetary value should be lower than if the Contractor encounters an point that has non been priced right or has non had the right sum of hazard allocated, ensuing in a fiscal loss for the Contractor.
Chapter 3 – Methodology
3.1 Introduction to Methodology
Here the Author has explained how the subject was chosen for the probe. It besides shows how the literature information was collated to bring forth the literature reappraisal which makes up the old chapter. Below is the method that was used to roll up informations and conclude the research.
The first phase was to carry on a literature reappraisal ( delight see old chapter ) , this stands as the footing for all the extra research conducted in this thesis.
3.1.1 Background Studies
The extra chapters of the background surveies are an built-in portion of the Author ‘s research as they act as an extension to the literature reappraisal. This subdivision besides gives an in deepness research into the two most of import constituents of the hypothesis ( I ) Design and Build and ( two ) Novation.
3.1.2 Design and Build
In the first subdivision of the background surveies there is a description of the design and physique contract which is used by Clients within the building industry ( delight see chapter 4.0 ) . This chapter describes the differences between the design and build signifier of contract and other popular contracts used by Clients including a description of the application of the attention and accomplishment clause used in contracts. In this subdivision the Author provides the different utilizations of design and physique from the position of a Client novating a design squad to a Contractor and the when the Contractor has the pick of which adviser to utilize.
The second of the background surveies looked at the novation facet of the proposed hypothesis ( delight see chapter 5.0 ) . Here is a description of what novation is and its utilizations in a design and construct context within building. The chapter describes the possible causes for a struggle of involvement between the Contractor and the Design squad. It besides states what issues may originate because of novation ; peculiarly in footings of the undertaking design, payment of the Design Team ‘s fees and any alterations in the public presentation of the Design Team.
The Author decided to interview the Contracting Company about the topic of the thesis because this would give an penetration into the company that the Author will be working for after his degree class is complete.
The interview inquiries were constructed from built-in parts of the literature reappraisal, and enabled the Author to roll up qualitative informations to analyze the hypothesis. The interview was held with the Author ‘s sponsorship company. The Contracting Company has had several old ages experience at covering with novation of a Design Team from a Client, and they besides have maintained a high per centum of Design and Build undertakings over recent old ages, ( delight see figure 1.0 ) . The interview was held with both a Senior Commercial Manager of 25 old ages experience and a Senior Design Manager of over 30 old ages experience in the building industry. The inquiries asked in the interview were designed to give the point of position from the Contractor about the working relationship between himself and the novated Design Team.
When a Client novates a Design Team to a Contractor it is the Contractor who will hold to bear the largest bulk of hazard for the design and building of a undertaking, therefore the position of the Contractor about the state of affairs is of up most importance. Time restraints of the research undertaking meant that it was non possible to interview an Architect about the same topic so cross mention this with the Contractor.
The Author decided that the Architect ‘s sentiment of the Contractor ‘s responses to the interview would be best made on a questionnaire. As mentioned above the Author decided to obtain the sentiments of an Architect by manner of questionnaire, this decreased traveling costs for the Author and allowed him to transport on the study while the Architect completed the questionnaire. The questionnaire was sent to an Architect of over 30 old ages experience in design and one who is used on a regular basis by the Contractor interviewed for design and physique contracts. The Architect has experienced the procedure of novation both individually and with the Contractor interviewed.
The inquiries which made up the questionnaire were derived from the responses given by the interviewed Contractor. The purpose was to set up if the Architect was in understanding with certain facets of the Contractors remarks. Besides the questionnaire was designed to pick out any similar responses between the two parties, to set up a subject and a solution to any common jobs.
3.1.6 Confirmation of Consequences
The consequences found in both the questionnaire returned by the Architect and the interview with the Contracting Company were analysed to find any common characteristics and responses made by both parties. The similarities that were found were sent to a Senior Commercial Manager at a different Contracting Company for his sentiment of the consequences, and to determine whether there were similarities within a different administration. The analysis was completed by the Author to take the possibility that the consequences found from analyzing the one Contractor and Architect were specific to that Contractor and were non representative of the industry as a whole.
The Contractor was a regional rival to the Author ‘s sponsorship company and has big experience in covering with novation and utilizing the design and build signifier of contract.
The research informations collected was qualitative owing to the nature of the topic and the whole nature of whether novation under a Design and Build contract is based on sentiment of many professionals. It would be highly hard to mensurate the success or failure of novation from a quantitative facet as both Contractors and Designers may non freely portion economic informations sing the fiscal results of a contract where the design squad was novated to the Contractor.
3.2 Aims & A ; Aims of Research
- To give a clear account as to the ground why methods were used, and why others were dismissed.
- To clearly bespeak the research methods such as the literature reappraisal and methodological analysis used at each phase of the research undertaking.
3.3 Topic Choice
Derek Swetnam [ 19 ] stated that:
Research is asking into some facet of physical, natural or societal universe. It must be systematic, critical, empiricaland have academic unity.
The choice of the subject was derived from the Author ‘s industrial arrangement during the 3rd twelvemonth of his class. The Author observed whilst on site that the relationship between the Architect and Contractor was a batch less affable than other sites the Author had worked on in the yesteryear.
On probe with both the Contracting Company and Design Team it was discovered that this was both the Design and Build contract in topographic point between Client and Contractor and the Design Team had been novated across to the Contractor upon successfully tendering for the undertaking, before work had commenced on site.
It was this that led to the involvement to look into further this capable country. The Writer realised that the research undertaken had to be completed within a certain clip frame. This placed great limitations on the sum of research that was possible in the fixed clip period. Holt [ 20 ] explains that most of import that, this volume of research has to be realistically possible within the clip frame
There were many limitations which influenced the subject choice. The inquiry of if the study rubric and thought was at all possible must be asked. David Swetnam suggests that [ 21 ]many thoughts will hold to be crossed out on evidences of impracticableness.
The research undertaking has followed the undermentioned stairss taken suggested by Derek Swetnam21:
- Is the undertaking physically possible in clip, distance and volume of the work?
- Can it be afforded? ( 50 letters and stamped addressed envelopes will be around ?30 )
- Do you hold, or can you quickly develop the accomplishments needed to carry on the research?
- Will you be permitted to derive entree to the suggested sites?
- Can you happen the necessary literature?
- Are there any ethical or moral jobs to get the better of?
- Will the subject remain ‘live ‘ over the period of the research?
- Would you hold the support of your Tutor and your co-workers?
This attack to look intoing the feasibleness of the survey country is echoed by Holt. However, Holt [ 22 ] does reference that the production of a thesis is a round in nature as the infusion below shows:
3.4 Literature Review
Derek Swetnam [ 23 ] provinces that the literature reappraisal is a cardinal portion of the thesis and in all manners of work it has a figure of maps.
3.4.1 Literature Review Functions.
- It shows that you have read widely around your chosen subject.
- It demonstrates your critical apprehension of the theory.
- Acknowledges the work of others.
- It informs and modifies your ain research.
Reviewing literature is an of import portion of any research undertaking, as this enabled the Author to try old research compiled by others. This in bend aided the Author in organizing an single sentiment of the chosen capable country. The literature reappraisal is the digest and assimilation of every bit much information as can be gathered before a concise methodological analysis can be formed.
3.4.2 Literature Data Collection
Following the choice of the capable affair and after the Author had decided upon a rubric and hypothesis research into old relevant literature was necessary.
Measure 1 –The Author ab initio searched for bing relevant literature utilizing the Pilkington Library at Loughborough University. This involved utilizing the hunt engine on the catalogue OPAC which is widely available at the university library. This method farther reduced the clip taken for the research to be performed. This method was adopted over any other as the Author was able to seek for literature by the specific Author, Title or by utilizing Keywords, many irrelevant books can be eliminated in this manner.
Measure 2 –The 2nd phase of the research the Author used the Metalib system once more at the library at Loughborough University. The intent of this research was to obtain more up-to-date information from specific legal and building related diaries and articles. This method of research yielded more research and information relevant to the subject than the procedure described in measure one. The ground for this is that merely cardinal building industry literature was being searched instead than standard text books which cover a broader scope of topics.
Measure 3 –The Author concluded the literature reappraisal by a comprehensive hunt for articles, diaries and newspapers from around the universe. This was completed by usage of the cyberspace, an in depth hunt of edifice magazines, any building intelligence and the Construction Managers Journal. General cyberspace hunt engines were used such as Google ( http//www.google.co.uk ) . However, these beginnings tended to give a wide consequence.
The Author found that the positions and sentiments of old Writers on the topic and yesteryear Research workers were more prevailing in diaries and articles instead than in books and newspapers.
- The research undertaking accounted for three faculties in the concluding twelvemonth of the BSc Commercial Management and Quantity Surveying degree the Writer is analyzing. As a consequence of this the Author felt it was of import to prioritize undertakings. Efficient clip direction was required to roll up the research undertaking every bit good as finishing all other faculties to the highest standards possible.
- The Author realised that there was non much literature showing sentiments of others in big wide topic text books.
- Most of the literature reappraisal was obtained from the articles found in diaries sourced via the cyberspace or utilizing Metalib.
- There were fiscal and disbursals restrictions as merely a few traveling disbursals could be afforded by the Author. This is the chief ground why the Writer opted to direct out a questionnaire to an Architect that would hold under normal fortunes have been personally interviewed.
- Owing to the nature of the subject and capable country the Author predicted that information to back up his hypothesis may non be freely shared. This would be true of any instances that could originate between Contractors and Interior designers.
- Due to clip restrictions impose upon the Writer it was merely possible to interview his patronizing company in some item. This information was transverse mention with one other major Contracting Company to set up if there are differences in sentiment and/or direction between the two companies.
- As a consequence of the little sample of three professionals one being interviewed and the other Contractor and Architect responding by questionnaire Hypothesis specific inquiries were asked. However, it will be hard to state that the consequences found were accurate of other or all Contracting and Design Organisations.
- The findings that were made merely partly back up the hypothesis owing to clip and fiscal restrictions. Additional research must be completed to guarantee that the consequences found by the Author either turn out or confute the hypothesis.
Derek Swetnam [ 24 ] provinces that:
A ll research for thesis requires a certain sum of dialogue to derive entree to information or interviews with professional.
He advises to follow these general tips:
- All communications to be of a high criterion and quality.
- If possible cheque names and positions beforehand.
- Be friendly but formal
- Explain what you intend to make.
- Offer to do consequences available if possible.
- Work to their clip restrictions, non yours.
- Cultivate your legitimate position.
The questionnaire was aimed to be answered by:
- An Architect who has experience of working for a Contractor under novation
- Would the individual reading and finishing this be interested and co-operative in make fulling it in?
- How could the receiver be encouraged to reply all the inquiries set and give the optimal information?
The Author decided that the questionnaire would be the preferable method to obtain research information from the above beginnings instead than interviews. The chief grounds for this are the clip and cost of research, and because the Author had built up a figure of contacts and relationships during his twelvemonth in industry. It would be easier to direct out a questionnaire to a selected Architect where a return of information could be assured.
Some commercial selling administrations such as the Readers Digest offer free award draws and still acquire low responses to the inquiry asked. When building a questionnaire general consideration must be made before even the first inquiry is written.
Derek Swetnam [ 25 ] provinces that:
Remember that a low rate of return may hold research significance and has to be reported. You will be fortunate if you reach a 70 % rate of response on personally collected questionnaires, and postal 1s may be every bit small as 10 % .
An effectual questionnaire should be good structured and requires good planning and an overall design.
Robert Patterson [ 26 ] suggests that:
The Objective of building effectual questionnaires is non to assist research workers avoid abashing enquirieslike that of the supervisor. More of import, the aim is to forestall research workers from inquiring ill designed inquiries and administering faulty questionnaires.
The method employed by the Author to build the questionnaire was to seek and see the questionnaire from the receiver ‘s position.
Oppenheim [ 27 ] suggests that:
Decisions on research techniques must be summarized and fall into the five groups shown below:
- The chief type of informations aggregation, interviews, postal questionnaires, contents analysis of records and experimental techniques.
- The method of attack to respondent ( Sampling choice, sponsorship, province intent of research, length and continuance of questionnaire, confidentiality and namelessness.
- The Build up of inquiry sequence or faculties within questionnaires and the ordination of inquiries.
- For each variable, the order of inquiries within each faculty, utilizing attacks such as a funnelling
- The type of inquiry to be used ; illustrations include ‘closed ‘ inquiry with pre coded reply classs versus free response inquiries.
The Author constructed the questionnaire following the suggested format by Oppenheim [ 28 ] :
- Length – Keep inquiries short in length, no sentence should be over 20 words in length.
- Avoid double barrelled inquiries – Keep inquiries simple, directly frontward, clear and apprehensible.
- Avoid Proverbs
- Avoid dual negatives – this will do confusion.
- Do n’t Know / Not applicable – do non give options non to react
- Simple words should be used – Acronyms, abbreviations, slang and proficient footings should be avoided.
- Beware of the dangers of dual use.
- Some words are ill-famed for their ambiguity.
- All closed inquiries should get down their lives as unfastened 1s.
- Beware of taking inquiries – Do non presume anything
- Pay attending to the inside informations – i.e. font size of the authorship.
There are many advantages with directing out questionnaires in the station, the chief 1s are as follows:
- 1. Avoidance of any prejudice which could come from an interview state of affairs.
- 2. Ability to research a wider scope of people who respond.
- 3. There will be a lower cost of treating the information that is collected.
- 4. There will be no traveling costs incurred to derive the research.
However, the Author decided to keep telephone conversations with the professionals willing to finish a questionnaire and understandings were made that the questionnaire was to be emailed to them and so returned by electronic mail. This resulted in a faster return at a much smaller cost, ensuing in greater clip being available to treat the information gathered.
3.8.1 The Questionnaire to the Architect
- Would you hold or differ that the four points above are the important factors that addition hazard to the Contractor & A ; Designer when the Designer has been Novated to the Contractor?
- Does the deficiency of fees available to the Designer have such a big impact on the public presentation of the Designer for the undertaking?
- As the Designer for the undertaking pre-novation, do you believe that your chief aim is to fulfill the Client non the Contractor with your designs post-novation?
- Make you value the sentiment and pick of design elements of the Client over the Contractor even after novation?
- In your sentiment are at that place more or less struggles between the Designer and the Contractor because of novation?
- Are the purposes and demands of the Client pre-novation wholly different to the Contractor ‘s post-novation?
This inquiry is the same as inquiry one in the interview inquiries posed to the Contractor. The intent of this inquiry is to set up whether or non the Architect that completes the questionnaire agrees with the above statement, and to formalize the Author ‘s research completed in the literature reappraisal.
This inquiry is used to set up whether a deficiency of fees available to the Designer towards the terminal of the design has an impact on the Designers end product and public presentation throughout the continuance of the undertaking. This inquiry is used to traverse mention inquiry three of the interviewed Contractor.
The inquiry is designed to happen out if the Designer sees the Client as the chief beginning of information for designs to be complete, or any fluctuations that need to be made, instead than the Contractor.
The Purpose of this inquiry is to detect if the Designer would still prefer to take instructions about design and specification from the Client instead than the Contractor, even after novation has taken topographic point, and if so for what grounds.
The Purpose of this inquiry is to traverse cite the information given by the interviewed Contractor in inquiry six. It will set up the Designer ‘s point of position on the sum of difference that occurs because of novation.
The intent of this inquiry is to detect if the Designer understands to the full that there is a difference in the demands and purposes of the Client pre-novation and the Contractor post-novation. This inquiry will give the Designer ‘s sentiment of the novation state of affairs.
3.8.2 Cross Reference Questionnaire with a Rival Contracting Company
- Would you hold or differ that the four points above are the important factors that addition hazard to the Contractor & A ; Designer when the Designer has been Novated to the Contractor?
This inquiry is the same as inquiry one in the interview inquiries posed to the Contractor, and inquiry one of the questionnaire sent to the Architect. The intent of this inquiry is to set up whether or non the rival Contractor that completes the questionnaire agrees with the above statement, and to formalize the Author ‘s research completed in T