Wherever a project or service involves high risks or unknowns there is a need for supplier(s) to be well aligned with Client’s/Owner’s needs, and this defines the field of ‘relationship’ contracting.
Regardless of the terminology, all contracts involve the following ingredients:
Commercial arrangements – including payment mechanisms, risk allocation, and potential variations to cost or scope – the details of which can act to align (or misalign) the parties’ interests.
People – with their capacity to perform well or poorly, in particular as a result of the commercial and cultural ‘rules’ established by the contractual relationship and the dynamics of the contract team.
When engaged by owners to establish a relationship contract we:
- Help owners make fully informed choices about the procurement strategy based on our deep understanding of the commercial and cultural issues common to most complex major projects and service arrangements.
- Design and establish frameworks and selection processes for alliances and other forms of relationship contracts (e.g. ECI). This includes the preparation of expression of interest (EOI), request for proposal (RFP) and proposed compensation framework (PCF) documentation as well as selected parts of the contract agreements.
- Facilitate all aspects of selection processes for relationship-based procurements, including processes aimed at securing genuine alignment on all commercial aspects.
- Help prepare the Owner’s team & evaluation panel to participate effectively in the selection process and eventual contract.
- Value for Money (VfM) analysis – prospective, current, and retrospective.
Our recent experience covers a range of contract models including Alliances, ECI, Managing Contractor, Collaborative D&C, Competitive Dialogue/Delivery Partner, and Incentivised Performance Contracts across an array of sectors. View our client case studies here…