PPMP20011 Contract and Procurement Management Case Study Sample

PPMP20011 Contract and Procurement Management

Part A - Written Assessment (Report)

You need to submit a business report in Word format into Moodle in Week 7. You are to complete the following tasks using the case study provided on Moodle website (Refer Case Study document):

• Critically analyse the case study and propose the most suitable procurement route(s) for the case study (sub-projects). The characteristics of the client, constraints, conditions, and available resources for each sub-project will be given.

• Justify the proposed procurement route for each sub-project and explain why this route is   the most suitable to make the project successful

• Propose the most suitable contract type for each sub-project for parties involved to    complement the procurement options.

• Discuss the associated risks and the key components which must be covered in the selected contracts.    

• Develop a project budget and an expenditure forecast as control mechanisms and link time, cost, and resources to the project framework.

• Your report should include a thorough analysis along with discussion and supporting evidence.

Case Study

Introduction

The Parramatta Light Rail is one of the NSW Government’s latest major infrastructure projects being delivered to serve a growing Sydney. Light rail will create new communities, connect great places and help both locals and visitors move around and explore what the region has to offer.
The stage 1 rail route will connect Westmead to Carlingford via the Parramatta CBD and Camellia with a two-way track spanning 12 kilometres. The route will link Parramatta’s CBD and train station to the Westmead Health Precinct, Cumberland Hospital Precinct, the Bankwest Stadium, the Camellia Town Centre, the new science, technology and innovation museum Powerhouse Parramatta, the private and social housing redevelopment at Telopea, Rosehill Gardens Racecourse and 3 Western Sydney University campuses.

Transport for NSW is responsible for improving the customer experience of transport services, transport policy and regulation, planning and program administration, procuring transport services, and infrastructure and freight.

Major construction of the light rail track started in 2018, and light rail services expected to begin operations by 2023.

Key Benefits

• Sixteen (16) stops in all from Westmead to Carlingford via Parramatta CBD.

• High-frequency ‘turn-up-and-go’ light rail services seven days a week, departing approximately every 7.5 minutes in peak periods.

• Modern and comfortable air-conditioned vehicles, 45 metres long, driver-operated and integrated with the Opal card network.

• Two (2) new light rail and pedestrian zones along Church and Macquarie Streets in the Parramatta CBD.

• The Parramatta Light Rail will replace the train line between Camellia and Carlingford, which will provide more frequent services and better connections to town centres, including Parramatta and Sydney CBD.

• A new Active Transport Link (shared walking and bike riding path) between Carlingford and Parramatta.
Project Requirements:

• Twelve (12) kilometres of light rail dual track.

• Sixteen (16) light rail stops and associated infrastructure (such as platforms, shelters,and lighting).

• A light rail stabling and maintenance facility at Rosehill Gardens.

• Ancillary infrastructure, including two new substations, power supply, wiring and utilities.

• Changes to existing bus stops.

• Changes to intersections and the configuration of traffic lanes at several locations.

• Acquisition of thirteen (13) light rail vehicle fleet.

• Light rail vehicles will be driven electrically with power being drawn from an overhead electric line.

Solution

Introduction

The report aims to develop appropriate procurement strategy or plan for Parramatta Light Rail project. This is basically a railway construction project that creates 12 kilometers long two-way tract. It connects Westmead and Carlingford. This project can create different benefits to the transportation industry and overall area development. It includes community development, and other business benefits. As per the MBA Assignment Experts, The local businesses and citizens will also be benefitted through the access of technology Cumberland Hospital Precinct, the Bankwest Stadium, the Camellia Town Centre, the new science, technology and innovation museum Powerhouse Parramatta, etc. In this report, different project development components and features are discussed in terms of effective implementation. The report will evaluate potential project risks, budget and other development and managerial aspects. This will finally lead to appropriate procurement management strategy and implementation for Parramatta Light Rail project.

The whole project is divided into different sub-projects that define the overall structure and process in this case. The sub-projects are, construction of railway, construction of maintenance facility and acquisition of light rail vehicles fleet. In the first phase, $2 billion were invested to prepare the whole railway and associated features that will influence the current community and infrastructure of the local area. It incudes, active transport link, increased patronage, public transport alteration, etc. In that case, it will be beneficial for overall economic growth and infrastructure improvement in local area and surroundings as well. In the next phase of maintenance facility, $0.3 billion will be invested. The area already requires different property removals such as old bus stop. Appropriate maintenance is required to maintain the quality of construction and overall consumer experience. Finally, the third phase with $0.1 billion, will be beneficial in terms of area management and resource distribution. In this report, all of these phases or sub-projects are assessed for constructive analysis and preparation of procurement management plan.

Procurement Strategy

The construction project of Parramatta Light Rail project must follow appropriate strategy and planning. The strategic planning first requires appropriate and efficient contractor. The project can be given to a single contractor or it may include different bidders for every sub-project. Both of these strategies have different advantages and disadvantages that become the determining factors. by evaluating all project factors, it can be established that the project requires single contractor. 

Justification

More than one contractor will be effective in active and appropriate project execution. In spite of that, giving the Parramatta Light Rail project to a single contractor will be most appropriate as it doesn’t include any specific time frame or urgency. In that case, the phases will be more compatible with each other. That improves the quality and success factor of the project. On the other hand, the overall analysis and project management will also be efficient. The project manager and other stakeholders will be able to manage the construction with active communication and planning with single contractor.

The project also consists fixed costing and resources. In that case, the Parramatta Light Rail project must follow fixed plan of action with management. Moreover, the strategic planning and development frameworks must be fixed as well. Overall, single contractor will be most effective in successful project implementation.

Responsible Person for Coordination

The responsible person to coordinate between the sub-projects will be project manager and senior contractor. The project manager will also be responsible to coordinate with different key stakeholders such as finance manager, resource manager, data management team, database management team, supply management team, etc. On the other hand, the senior contractor in Parramatta Light Rail project, will also be responsible for managing different construction teams, visual models of planning, over and data analysis, risk analysis and other essential project development factors.

Organizational Recommendation

The primary objective of the consultation organisation is to guide and manage different operational and organizational component. In this case of Parramatta Light Rail project, the consultancy organisation can you play a significant role in terms of project management and execution as well.  The consultation agency will be able to structure the project management and overall operational management into the project. It includes, appropriate implementation strategy and future project scope management as well.

The agency can also help in overall data analysis or resource management analysis. In that case, the overall database management and research team will start to evaluate different secondary and primary resources that will include previous case studies, personal interviews of the stakeholders, etc. This is the responsibility of the data mining or management team to collect these resources. It is the responsibility of the consultancy organisation to evaluate further and to prepare appropriate plan of execution through constructive guidance to the development team.

Procurement Routes

Procurements routs are some specific strategies to implement into the project development phases (Laryea, 2019). It makes the Parramatta Light Rail project, more effective in real-life scenario. In this case, the project is divided int three phases or sub-projects. The primary sub-project of construction of main railway and infrastructure, may follow two procurement routs such as, standardizing the development and supply chain. The research and analytical evaluation will be conducted to establish appropriate supply chain and development methodology. In that way, the whole development of Parramatta Light Rail project, becomes efficient and effective in nature. 

The second phase of building maintenance infrastructure, will follow, predictive analysis as a route of procurement. In that case, the data analysis and development team will evaluate particular consumers needs that will help to prepare effective project plan (Mena et al., 2018). On the other hand, the last phase of building vehicle fleet will require, centralization of supply database. In that case, all the supply data evaluation will be implemented into the project. This will be effective in acquiring efficient vehicles fleet into the project with fixed cost and time frame.

Risk Identification

Risk identification into a project leads to appropriate mitigation plan for the project (Dziadosz & Rejment, 2015). In this development project, three specific procurement routs are applied, that can also cause different project constraints and risks.

Table 1: Procurement: Risk Identification
(Source: Developed by Author)

The primary risk while centralizing the whole supply or development chain, will be management and resource efficiency. It may require sudden requirements of resources. In that case, the senior project manager and senior contractor need to develop appropriate planning, that can implement this procedure from the beginning.

The second phase of Parramatta Light Rail project development, will follow predictive analytical approach that presents the idea of collected secondary resources and market reports. In some case, the data implementation can show complexity as it consists secondary resources only as the project budget and planning include a large range of stakeholders, and project features (Harrison et al., 2019). The project manager needs to develop appropriate research methodology and procedure that can create effective analysis.

The final risk will be cost efficiency. The project already has fixed costing. In that case, the final phase requires strategic evaluation of consumers needs in terms of availability and supply. Moreover, it must maintain the quality of service as well. The project manager must distribute the cost with appropriate supply chain. In that way, this risk can be resolved in terms of effective influence into the project. 

Contract Types

Contracts are some legal documentations that consist different project agreement and regulations (Shash & Habash, 2020). Both of the contracting parties must maintain these rules and conditions, mentioned into the contract. Appropriate contracts are essential in any business or development project, especially when a huge number of stakeholders and components are associated. In this project, contract types are determined from the requirements and potential impact.

Table 2: Contract Types
(Source: Developed by Author)

Risk Analysis

Particular risks are associated with this overall development. The contracts, mentioned here will also cause potentialities into the project that must be resolved with appropriate strategic approach. This risk analysis of Parramatta Light Rail project, also follows different from work or visual tools that can provide structured overview of the risk and appropriate mitigation plan. It also includes the primary response of the stakeholders and overall project development and management team. In this case of construction management of Parramatta Light Rail project, the potential risks must be evaluated and resolved accordingly. In this phase of the report two types of Potential project risks are evaluated or discussed. Initially different contracts that are associated with the overall project, are critically discussed in terms of risk and appropriate mitigation. On the other hand, particular list in transportation of different project phases will also explain appropriate risk response to the management team.

Contract Risks

In the first case of Railway construction, the fixed price and a resource contract will be applied. In that case, the appropriate methodology and reasonable cost and time distribution will be achieved. In spite of that, this can cause different complication into the project. A huge project like Parramatta Light Rail development, can cause different resource requirements while the development into the project. In that case, it is the responsibility of project manager, resource manager and finance manager to evaluate the current scenario and requirements. Overall, the fixed price contract will not allow the stakeholders and business leaders to implement certain requirements with appropriate approach. Even, the approval procedure will be more complex in terms of effectiveness and application.

The second contract of time and material will also be applicable in the second phase where the maintenance preparation will be conducted for the construction site. In that case, the materials and the time frame must be pre-defined and documented before the overall development execution. In spite of that, the second phase requires different other considerations such as ethical consideration, stakeholder analysis, feedback analysis and other project management and development component. Overall, the project execution must follow different visual tools and structured methods of implementation. In that way, the certain requirements and project list will be simplified and resolved accordingly. Though, it is the responsibility of the project manager to conduct the overall risk analysis and to implement them accordingly.

In the final phase, the development will follow unit pricing contract. In that case, the overall development team will consider the unit price of different vehicles before the acquisition procedure. This is also beneficial for the project as the cost and overall time frame is already fixed. In spite of that, this can cause some limitations while choosing the appropriate vehicle fleet. On the other hand, the management procedure of creating the overall supply chain or transport system will also be affected by this contact. In that case, the project manager and other senior organizational stakeholders must evaluate the current requirements and development as pets for further analysis. This will help in planning for the appropriate vehicle seat with effective application in real life scenario.

Risks in Transport

The overall transportation system into the project requires appropriate risk analysis to develop effective mitigation plan. In this section, potential transportation risks of Parramatta Light Rail project, are discussed with appropriate risk response that can be applied through efficient development and management methodology.

Table 3: Risks in Transport
(Source: Developed by Author)

Budget Breakdown

Budget breakdown is a structured framework for process that can evaluate or distribute the whole budget into different project phases. It can also include different operational faces and construction components in this case. The overall case study can show the cost distribution in two different Sab project phases. In spite of that, detailed budget breakdown of Parramatta Light Rail project, will help in better evaluation and maintenance of cost efficiency. On the other hand, the project manager and other essential stakeholders will be able to execute the project phases in an efficient and effective way. This will not affect the budget or overall resource management of the project.

Table 4: Budget Breakdown
(Source: Developed by Author)

Assumptions

• The supply management must include efficient equipment and supplies for the project.
• This overall budget can be increased for different content types and potential risk into the project.
• Efficient system will also be beneficial in overall supply management.
• Appropriate system policies and development policies will be required to execute the development project.
• The system development must go through regular moderation.
• Appropriate technical team must be prepared for further support and maintenance.
• The development may cause inefficient time distribution as the phase will be finalized after the primary phases.
• The development may cause poor team management as it includes different development component.
• The system database must use cloud technology as the database management will be inefficient and cost-inefficient with physical data warehouses.
• The project requires flexible methodology and development execution for appropriate project results.
• The overall project development must implement visual tools and methodologies for better and effective implementation.

Minor Sub-Project Requirements

Project requirements include different project results and objectives that any particular resources or supplies. In this case, the major requirements or operational aspects in the first phase or sub-project is already discussed with budget breakdown. In spite of that, some of the minor requirements for operational supplies must be considered for better implementation and understanding of the overall project process. It includes,

• System devices management and supplies
• Development of appropriate system policies
• Development with environmental consideration
• Waste and power management
• Regular moderation
• Physical and digital Security equipment

The remaining budget of the project will be applied to develop and maintain this secondly or minus a project operational adequate means. This will eventually be beneficial for the project in terms of practical effectiveness and application in real life scenario. It also requires active communication and appropriate to check the management to achieve efficient project results.

Conclusion

In this first phase of the report, the overall case study on Parramatta Light Rail project, is critically analysed and evaluated in terms of project planning and execution. Moreover, it includes appropriate analysis of the project component that can be beneficial in determining appropriate procurement strategy and approach for the project. In the first phase of the research, the Sub project parts are analysed to evaluate appropriate requirements and procurement strategy. After that, different procurement rules are identified to apply into different phases. It includes procedure, implementation methodology, etc. Some of the risks are also identified in this phase that can be beneficial for the project manager to evaluate the current project situation and procurement strategic application.

In the next phase, different contact types are mentioned for different project faces. All of this are different in terms of practical application and implementation in real life scenario. This will help the project manager to determine appropriate contract strategy for the overall development. In the next phase of risk analysis, the concept types and different transportation risks are evaluated. In that way, the risk analysis will be more effective in successful construction project. On the other hand, the project concepts face pricing and other resources. In that case, the budget analysis or cost distribution analysis will help the project to implement the strategic planning. Overall, the Report will help different organizational leaders to plan and execute the overall construction in an effective way.

References

Dziadosz, A. and Rejment, M., 2015. Risk analysis in construction project-chosen methods. Procedia Engineering, 122, pp.258-265.
Harrison, B., Foley, C., Edwards, D. and Donaghy, G., 2019. Outcomes and challenges of an international convention centre's local procurement strategy. Tourism Management, 75, pp.328-339.

Laryea, S., 2019. Procurement strategy and outcomes of a new universities project in South Africa. Engineering, construction and architectural management.
Mena, C., Van Hoek, R. and Christopher, M., 2018. Leading procurement strategy: driving value through the supply chain. Kogan Page Publishers.
Paté‐Cornell, M.E., Kuypers, M., Smith, M. and Keller, P., 2018. Cyber risk management for critical infrastructure: a risk analysis model and three case studies. Risk Analysis, 38(2), pp.226-241.

Shash, A.A. and Habash, S.I., 2020. Construction Contract Conversion: An Approach to Resolve Disputes. Journal of Engineering, Project & Production Management, 10(3).