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Procurement: Dedication to collaboration

Despite the majority of large contracts on the Olympic Park being awarded, there is still £2bn of smaller jobs and subcontracts up for grabs. ODA construction director Howard Shiplee says he's looking for firms that are committed to collaborative working.

With the Aquatics Centre, main stadium, Velopark and many other contracts now awarded, one could be forgiven for thinking that the gold rush for London 2012 contracts is over.

Not so. Unlike many clients, the ODA is taking an active role in the procurement of its main contractors' supply chains.

"We've agreed with all our contractors that we want to be involved in the tier two process for two reasons," says ODA construction director Howard Shiplee. "First, to understand which contractors are being proposed and decide whether we are comfortable with them. Second to ascertain whether they fit the profile that we want to establish for the way we do business here."

In some cases this interaction may mean the ODA talking to and assessing a contractor's existing supply chain. However, in many cases it will take the form of contractors advertising their opportunities on the ODA's supply chain brokerage service CompeteFor.

"We've got about 23,000 companies registered," says Shiplee. "Among those, roughly 18,000 are small and medium sized enterprises over 7,000 are from London and 6,000 are from black and ethnic minorities, disabled or are women-owned. This shows we're getting where we want to be in terms of the 2012 Construction Commitments."

The 2012 Construction Commitments cover six areas: client leadership; procurement and integration; design; sustainability; commitment to people; and health and safety. The commitments include promises to ensure effective and equitable cash flow for all those involved, informal and non-confrontational mechanisms to manage disputes and the training of local people to work on the Games.

Above all, the ODA and its main contractors are committed to working collaboratively with the whole supply chain. Shiplee is therefore justifiably pleased with the number of SMEs already working on the Olympic Park, particularly local businesses. "About 70% of the companies doing work for us are SMEs," he says. "Half of our suppliers are from London and about 12% are SMEs from the five Olympic boroughs Đ Newham, Hackney, Waltham Forest, Tower Hamlets and Greenwich.

"10% of the current Olympic Park workforce was registered unemployed before they came to work on the Olympic Park and about 20% are from the five boroughs. The contractors are working wholeheartedly with us on this."

Many of the construction firms working with the ODA have been signed up on contracts from the NEC engineering and construction suite of contracts, designed to embrace the concept of partnership.

"It's a highly collaborative form of contract that drives out bad news very early Đ often on major projects bad news travels upwards very slowly," adds Shiplee.

The main mechanism the ODA has introduced to drive out "bad news" has been its Independent Dispute Avoidance Panel (IDAP) - chaired by president of the Association for Project Management, Martin Barnes - and an adjudication panel.

"Disputes are highly disruptive both in terms of time and cost, but the other thing about disputes is they are highly disruptive in terms of relationship," says Shiplee. "People can be working together for a long time, a dispute occurs, everyone backs off into the trenches and the collaboration stops. I don't believe anyone on this programme can afford that sort of thing - we can't, the contractors can't, because if you do that you then risk our main objective.

"Equally, it's no good saying 'don't worry about the dispute, let's all work together and we'll sort it out at the end'. This is public money in a serious Goldfish bowl of interest with a massive amount of public scrutiny so you can't leave things unresolved for later."

IDAP is available to help the client and its construction contractors to avoid any potential disputes that could impact on the delivery of the Olympic Park and other London 2012 venues.

The panel will focus on finding pragmatic solutions to problems before they become disputes.

"The avoidance panel is a bit of a journey of discovery because nobody's really done this before in this particular way," says Shiplee.

If the approach fails, the dispute then moves to the adjudication panel, chaired by founder of the
Adjudication Society, Peter Chapman, and made up of experienced adjudicators appointed by the Institution of Civil Engineers.

If either party decides to challenge an adjudicator's decision, the final tribunal is the Technology and Construction Court. "However, the plan is always to find a solution," concludes Shiplee.

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