EG7036 Business Procurement and Contractual Practice
The construction industry has a significant contribution in most countries and the UK construction industry is also not an exception. The UK construction sector contributes almost 10% to its GDP and employs around 1.5 million people (Kuragu et al. 2016). Currently, the requirements regarding construction and buildings related to service are continuously changing for meeting dynamic social demands, and demographic changes as well as reducing environmental impacts (Selviaridis, 2021). The Indian construction industry is valued at INR 701.7 billion during the year 2022 and is achieved a growth of 6% from the year 2024 to 2027 (Global data, 2023). India spends 0.6% of its GDP on the procurement of the construction industry whereas in comparison the UK spends GBP 471 million on its R&D procurement in the construction industry (Theconstructionindex, 2023). Expenditure spends on R&D on procurement in the construction industry of India and the UK help in growing the overall productivity and performance of the organisation. For this reason, this study is focused on highlighting the impact of R&D investment on procurement of the UK construction sector.
Summary
The UK construction sector is perceived to have a low level of innovation and R&D expenditure in comparison to other sectors. However, in comparison with various other construction industries worldwide, the UK construction sector lags behind global leaders regarding profitability, productivity, and investment of capital in the research and development process. In 2011 the R&D expenditure within the UK construction sector was around £22 million (Service.gov.uk, 2013). The construction sector in India is perceived to be a low level of innovation and R&D which makes it difficult for the construction sector to grow their overall productivity and maintain efficiency. R&D expenditure in the UK constriction during the year 2021 was GBP 471 million in the year 2021 (Construction news, 2023). Whereas, R&D expenditure in India during the year 2021 grew up by 0.7% which is very low in comparison to that of other countries (Thehindu, 2023). Lack of investment in construction R&D and decreasing support from the management makes it difficult to maintain effectiveness and productivity.
Conclusion
The study has discussed various factors related to the impact of research and development (R&D) expenditure in response to the procurement of the construction sector in the UK and India. The study has discussed that the UK and Indian construction sector has faced significant challenges over the past decade because of research and development programmes and a lack of investment in research and development on the procurement of the UK-based construction sector. The study has defined that the UK and Indian construction sectors must Paradise for creating long-term research and development programs and increasing investment for the growth of the construction industry as it significantly contributes to the GDP and creates employment opportunities for the people. The study has also highlighted the lack of investment in the construction R&D process that has made it difficult to maintain competitiveness and contribute to the growth of the construction sector in the UK and India. Developing the R&D process also helps the constriction firms in growing their competitiveness and maintaining efficiency. Because of this low level of expenditure, the UK and Indian construction sector have gone through several challenges in the adoption of technology and driving competitive advantage.
References
Constructionnews, 2023. Construction-rd-spending-soars-during-pandemic. [Online]
Available at: https://www.constructionnews.co.uk/financial/construction-rd-spending-soars-during-pandemic-24-11-2021/ [Accessed 8 May 2023].
Globaldata,2023.Indiaconstructionmarketanalysis.[Online]Availableat:https://www.globaldata.com/store/report/india-construction-market-analysis/[Accessed 8 May 2023].
Kulatunga, U., Amaratunga, D. and Haigh, R., 2006. The role of research and development in achieving excellence in construction.
Selviaridis, K., 2021. Effects of public procurement of R&D on the innovation process: evidence from the UK small business research initiative. Journal of Public Procurement, 21(3), pp.229-259.
Theconstructionindex,2023.Construction-rd-investment-hits-new-height.[Online] Available at: https://www.theconstructionindex.co.uk/news/view/construction-rd-investment-hits-new-heights[Accessed 8 May 2023].
Thehindu,2023.Indias-rd-estimates-are-an-incomplete-picture.[Online]Availableat: https://www.thehindu.com/opinion/op-ed/indias-rd-estimates-are-an-incomplete-picture/article66545931.ece#:~:text=India’s%20research%20and%20development%20(R%26D,R%26D%20by%20the%20corporate%20sector.[Accessed 8 May 2023].
The role and methods of dispute resolution boards in the construction industry
A dispute resolution board is a form of alternative dispute resolution typically used on larger constriction projects. A DRB is proactively appointed on a project before any dispute arises. Dispute resolution boards in the construction industry of the UK are responsible and accountable towards guiding to resolving project issues along with mitigating their impact during an active construction project (Practicallaw, 2023). The dispute resolution boards in UK and Srilanka mitigate the disputes among the employees through the help of negotiation, litigation, arbitration and mediation. A discrete contract amongst the owner, contractor and board members plans the terms of the board retention (Cida, 2023). The board members are frequently nominated by two approaches that being including the mutual selection of all board members by contracting parties, each party selects one board member and those board members choose the third member (Illankoon, et al., 2022). Board members also intend to mitigate the disputes amongst the board members of the UK and Srilanka that help in setting up a strong project base and completing the project on time. The board members of the UK and Srilanka provides guidance and decisions to the employees to perform their task accordingly.
Summary
Dispute resolution board in the UK has been divided into three types dispute review board act as facilitating process, to get the parties to engage with one another without creating a conflict to work towards a resolution. Dispute advisory board issues formal reasoned decisions that are binding on both parties (Drb, 2023). Combined dispute board roles include developing conciliation and making recommendations, they also hold the power to give firm and binding decisions (Mondaq, 2023). The role of dispute boards in the UK is to create a system that helps in mitigating the dispute by resolving the situation by taking appropriate measures and steps. The decisions are not enforceable and not binding that help in resolving the issues and take up appropriate steps to complete the task. Examining the role of the dispute board in Srilank it has been identified that it is divided into four categories as admiralty act, intellectual property act, companies act and arbitration act (Lexology, 2020). The laws are being set out by the dispute resolution boards of Sri lanks that help them in mitigating the dispute and establishing better work activities.
Conclusion
The role of the dispute resolution board is to mitigate the issues that are being faced by the parties while working on the task and activities together. Different dispute resolution methods are being undertaken to mitigate the issues such as negotiation and arbitration. The negotiation process between the parties turns out to be a major process that helps in establishing a relationship between parties and encouraging them to come down to a mutual agreement that positively contributes to the development of the organisation. Moreover, the dispute resolution board of the UK is different from that of the Srilanka hence the actions to resolve the issues are also different. Dispute resolution boards in the UK and Srilanka also intend to facilitate a higher level of engagement between the parties to the contract that help in promoting communication between the parties. Dispute resolution in Srilanka is being resolved through different acts that help in mitigating the issues. Hence, the role of dispute resolution in the construction industry turns out to be significant.
References
Cida,2023.DisputeResolution.[Online]Availableat:https://www.cida.gov.lk/pages_e.php?id=53[Accessed 8 May 2023].
Drb,2023.Disputeresolutionboard.[Online]Availableat:https://www.drb.org/[Accessed 8 May 2023].
Illankoon, I., Tam, V., Le, K. & Ranadewa, K., 2022. Causes of disputes, factors affecting dispute resolution and effective alternative dispute resolution for the Sri Lankan construction industry. International Journal of Construction Management, 22(2), pp. 218-228.
Lexology,2020.DisputeresolutioninSriLanka.[Online]Availableat:https://www.lexology.com/library/detail.aspx?g=eebc86ef-3934-43f1-8fe2-ccaab3eb46cf[Accessed 8 May 2023].
Mondaq, 2023. Dispute-boards—why-are-they-used-and-why-should-you-use-them. [Online]
Available at: https://www.mondaq.com/uk/arbitration–dispute-resolution/1296184/dispute-boards—why-are-they-used-and-why-should-you-use-them[Accessed 8 May 2023].
Practicallaw,2023.DisputeResolutionBoard.[Online]Availableat:https://uk.practicallaw.thomsonreuters.com/35511886?transitionType=Default&contextData=(sc.Default)&firstPage=true#:~:text=An%20independent%20panel%20of%20impartial,describes%20its%20role%20and%20responsibilities.[Accessed 8 May 2023].
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