CRITICAL ANALYSIS OF JOURNAL AND THE COMPARISON BETWEEN TWO CONTRACTS Assignment Sample
1.0 Critical analysis of an academic journal paper focusing on Challenges of construction procurement: A developing nation’s perspective
A critical review has been established based on an academic journal paper focusing on the challenges of construction procurement from the perspective of a developing nation. The construction industry in a developing nation is facing global challenges for the procurement of any infrastructure project. For supplying good shelters, schools, hospitals, roads, etc. procurement is necessary for construction that has been discussed in this journal. The researchers Ogunsanya, et al. developed their research paper in the year 2016 regarding the challenges during the construction procurement in a developing nation. In this part, a critical review will be developed including the aim and objectives of the researchers. The methodology that they used during their research will be discussed here. There are also some strengths and weaknesses among the researchers and the challenges they have faced will also be described in this critical analysis part. The factors affecting the construction procurement in Japan and the challenges faced during the development of procurement have been discussed by the researchers and the effect of improper implementation of a legal framework have been critically reviewed in this paper. This paper has also provided a procurement strategy adopted by Nigeria, a developing nation. In the construction industry, there are many approaches to the procurement of the country that are not only for the required cost, quality, and time required for the project but also tools that are associated with the economic conditions and social development of that developing country. CIB in the UK, CIDB in South Africa, and CIDB in Malaysia have been established to achieve a procurement strategy for construction. But the construction industries are facing many problems regarding cost, time, lack of professionalism, lack of work opportunities, etc. It has been stated from this journal that not only the above challenges faced by the construction industries but also there are additional stress of economy, insufficient resources, and weaknesses in many cases. Construction procurement is considered a key factor that the construction industries that can provide satisfaction to the clients and the project will become successful. Procurement can be defined as a system developed in a construction industry that helps to provide specific responsibilities for the construction project. As a developing country, Nigeria is needed to implement such types of procurements that help to develop the strategies to meet up the demands of the clients in different circumstances. Depending upon the client’s involvement, arrangements of fundings, types of contracts used in the construction, management of risks the requirement varies. From this journal it has been seen that there are many procurement methods like management of construction, traditional, direct labour, etc. that the Nigerian construction industry adopts to make construction functions. It is very important to know the procurement methods to face the challenges during the adoption of procurement in the construction industry. As stated in this journal the challenges of procurement in construction are defined from the views of a different perspective. From an economist’s view, the challenge of construction procurement is started from the view of the transaction. Depending on the type of construction contracts the price related to each construction project is different. From a traditional engineering and construction management view, the factors that are connected with the challenges faced by the construction industry for the procurement of construction are such as the topographic condition of that country, weather, logistics, and technologies available for the construction, availability of the services, and labours. All the factors are related to the procurement process. In this journal, the researchers discussed the transformation, flow, and value generation theories from the perspective of a lean construction industry that provides value to the construction industry. But according to other researchers maintaining these theories is not easy for the lean construction industry. The construction industry in Japan as a developed nation is facing challenges. With the help of this journal, it became easy to get an idea about the factors affecting the construction procurement such as the role of the construction industry at local levels, improvement of quality of work, a public procurement used as a tool for change in the society, etc. In Nigeria and Zimbabwe, the factors are different for the construction procurement that are such as deficiency in design, shortage of materials, increase rate of materials, dissatisfaction of clients, etc.
The researchers used a qualitative research approach that has the strength to provide significance and a deep understanding of the procurement of construction. In the Nigerian construction industry, it is important to identify the key stakeholders that are very important to provide construction procurement to the construction industry. The researchers have developed an interview session depending on the type of stakeholders who were involved with this project. From this process, it has been seen that all the stakeholders agreed with the infrastructure that is connected with the construction procurement. Due to improper implementation of a legislative framework the development of the construction industry is not possible that can be understood from the journal. The Public Procurement Act is responsible for the infrastructural projects that the budget performance in Nigeria was 71% over the past five years. The researchers have also discussed many factors that are identified as a factor affecting construction procurement in Nigeria. Unstable condition of the economic environment, lack of knowledge about the procurement methods, corruption, standardization of construction materials, lack of knowledge of clients about the procurement process, and at last but not least political influence are the factors that have an influence on the adoption of procurement in the construction industry. After analyzing this journal it can be said that as a developing nation Nigeria has to implement a different construction procurement that helps to make a strong infrastructure. This journal is very useful to know the factors that affect the development of the construction industry. By identifying the challenges and factors the construction industry in Nigeria can provide strength to their business.
2.0 Essay about the key construction contracts NEC4 ECC and FIDIC 2017
2.1 Introduction
This essay consists of the two key construction contracts as NEC4 ECC and FIDIC 2017 that are considered as a mutual agreement between two parties that decides a date and participants who are connected with the construction process. The construction contract is executed between the contractor and the owner of the construction project. It is very important for a construction project since it provides an outline of the scope of the construction project, risks, duties, etc. for both the participants. There are various types of construction contracts in the construction industry but among all the contracts in this essay two types of contracts have been discussed that are NEC4 ECC and FIDIC 2017. For these two contracts, the conditions of guiding payment are different from that are discussed. The guiding of project programming and the resolution methods are also different for the two contracts that can be executed from this essay.
2.2 Comparison of conditions guiding payment
Contractors need to maintain constant payments. In NEC 4 ECC construction contract, the project manager is associated with the payment process. The contractor must be aware of the constraints during the submission of the payment application before the assessment date. When the contractor fails to submit the payment application then the mount will be less than the given assessment. In that case, the employer has to pay the amount within three weeks (Swift, 2019). This contract is directly connected with the payment date. In the NEC 4 ECC construction contract, the contractor cannot suspend the work or reduce the rate of productivity. In this contract, if the payment is delayed due to any reason then the contractor has to give two scenarios to recover the situation.
In the FIDIC 2017 construction contract, the contractor has to submit an original paper of statement and an electronic copy each month to the engineer who is in charge during the construction. It is the duty of the engineer to issue the IPC in 28 days to the employer and 56 days are there to pay the amount. These 56 days are counted from the date when the engineer gets the application of payment. In this contract, three scenarios have been provided to the contractor to use.
2.3 Comparison of conditions guiding project programming
In the NEC4 ECC construction contract, Accepted Programme is used to evaluate the results about the compensation and it is extensively used in this contract. When there is no such Accepted Programme then the extension of time is dependent on the assessment of the project manager depending upon the balanced work.
In the case of the FIDIC 2017 construction contract, it is the responsibility of the contractor to submit the paper according to the program when the progress is required by the engineer in charge. Not like the NEC 4 ECC contract, the FIDIC 2017 contract requires more programs to complete the project (Mante, 2018). The programs have to be submitted in electronic format in this contract. All the details regarding the construction project like all the activities related to the project are provided. Not only the activities but also the start and finish dates of each activity, critical path, and all the supporting documents connected with the project have to be submitted when this type of contract is chosen.
2.4 Comparison of dispute resolution methods
There is also a comparison of dispute resolution methods between these two contracts that are described below. For the NEC 4 ECC contract, a parallel step has been followed by the contractors. In this contract, the methods for resolving the disputes are based on provisional. There are many countries where it is mandatory to adopt this contract as per the function of dispute boards. In this contract, it is necessary to use the dispute avoidance board by the parties who are connected with the construction project. From many aspects, it is almost similar to FIDIC DAAB from the perspective of avoidance of dispute boards. The dispute resolution methods are decided by the dispute board that is considered as a standing board between one and the three representatives who visit the site by maintaining a particular time. After choosing this type of contract, it is the responsibility of the dispute board to solve the conflicts in the construction sites (Hai, et al. 2020). The dispute avoidance board has the ability to provide suggestions if there are any disputes in the construction site when they work based on this contract. Otherwise, to solve the disputes the parties have to go to the dispute avoidance board. The parties if unenthusiastic to solve the disputes then they have to be suggested an alternative technique.
By adopting FIDIC 2017 contract, there are mainly two clauses to avoid disputes. It is different from the NEC 4 ECC contract. In the first clauses, it has been stated that the two parties engaged with the construction process must be consulted by the engineer in charge to resolve the problems. In this contract, the engineer has 42 days to solve the disputes but if it is not possible for the engineer then a determination has been adopted by the dispute resolution board that is very depressive for the engineer. In the other clause, the disputes can be avoided by giving more attention to DAABs in this contract. In the FIDIC 2017 contract, the dispute avoidance board provides more attention for resolving disputes. The dispute board has to adopt a formal dispute avoidance process before the expansion of the disputes.
2.5 Conclusion
From the above essay, it can be concluded that an adjustable risk management system must be implemented in every construction contract. From the above comparison, it can be stated that NEC 4 ECC provides more facilities to cooperate the project whereas the FIDIC 2017 contract depends on the distribution of disputes as a traditional contract. In the case of the FIDIC 2017 contract, it is needed to be more intensified on the management. It can be concluded that the FIDIC 2017 contract is considered the standard international contract for a long time whereas the NEC 4 ECC contract has been launched in 1991.
Reference list
Journals
Hai, D.T., Trung, N.N. and Huyen, K.D., 2020, June. Contract Form for Building Information Modelling (BIM) Projects Applied on Construction Industry in Vietnam. In IOP Conference Series: Materials Science and Engineering (Vol. 869, No. 6, p. 062005). IOP Publishing.
Mante, J., 2018. Dispute resolution under the FIDIC and NEC Conditions: paradox of philosophies and procedures?. International construction law review, 35(2).
Simon, N., 2020. Entwicklung eines Prämiensystems zur Berücksichtigung der Bauprozessqualität in Bauverträgen.
Swift, A.R.J., 2019. Conflict of Interest: The Dual-Role Superintendent/Lead Designer in Construct Only Contracts.
Zea, A.M. and Ramírez, C., 2017. La implementación del sistema de alertas tempranas para el cambio de paradigma hacia la gestión eficiente y colaborativa del proyecto. Derecho & Sociedad, (49), pp.145-161.
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