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Unformatted text preview: g for Procurement
• Partnering as a procurement methodology was first used in
construction in the USA with Arizona State Highways and the US
Army Corps of Engineers in the 1950s. Their partnering projects
delivered proven cost savings of 9% and improvements of 8% in
project delivery time.
• Partnering was introduced to the ____________ and the United
Kingdom (UK) construction industries in the early 1990s.
• Success with project partnering in the UK led several private sector
organizations to enter into long-term strategic partnering involving
consultants and contractors working on successive projects with
the same clients.
• The best examples produced 30% reductions in both cost and time
over a five year period. Significant improvements were also
achieved in one-off projects through partnering in infrastructure
projects for airports, railways, highways and water systems.
14 4 History of Partnering for Procurement
• The UK and Australian partnering experience was initially
‘transferred’ to Hong Kong to counter:
– Visible deterioration in project delivery performance
– Adversarial industry culture and conditions of contract
– Competitive tendering with awards made on the basis of price
rather than value
– Fragmented system of multiple subcontracting
– Low investment in training and construction management
• The first use of partnering in Hong Kong led to some notable
success on hospital projects in the mid 1990s – for example the
Northern District Hospital project in 1994.
• The subsequent success experienced by the MTRC with the
Tseung Kwan O Extension.
15 • Partnering has since been used in various forms by the MTR
Corporation Limited (MTRC), utility companies, the Hong Kong
Housing Authority (HKHA), the Airport Authority (AA), the
Development Bureau and a number of private sector projects.
• The MTRC New Extension Projects (five new lines targeted for
completion by 2015) will all be delivered using partnering.
• The _____________________________(DSD) is implementing its
first pilot project under the New Engineering Contract (NEC) form
of contract using a suitable contractual partnering arrangement.
• So far, results of partnering range from ‘exceptional’ to ‘no
• ___________________ partnering is currently fairly common in
Hong Kong. Non-contractual partnering is not legally binding. It
does not change the terms of contract or the contractual
relationships between the parties.
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- Fall '14