Guidance backs procurement of whole-life value

In September 2022, the UK government published a revised version of The Construction Playbook, a document that sets out key policies and guidance for the way public works projects and programmes are assessed, procured and built.

Its stated aim was to 'create a contracting environment that delivers a sustainable, resilient and effective relationship between contracting authorities and the supply chain', resulting in long-term value for all.

In practice, this means thinking about how a building or infrastructure project will be used, allowing for different approaches to be explored while still achieving the same positive outcomes. 

This could mean, for example, specifying that desks in an office are sufficiently lit for detailed tasks, rather than detailing a set of requirements for lighting fixtures.

For those involved in contracting, the question can be how to implement this outcome-based approach. 

At BSI, our role has been to collaborate with government, industry, and stakeholders alike to enable a consensus-based, consistent approach. Our objective is to ensure that good practice is established, disseminated and observed by the built environment sector.

In 2006, following a joint initiative by Department of Trade and Industry and Constructing Excellence on the Rethinking Standards in Construction report, work began on what would become BS 8534:2011 Construction procurement policies, strategies and procedures. Code of practice.

This work aimed to change procurement practices to embed whole-life, sustainable, integrated and measurable ways of working into contractual arrangements.

Developed with the support of Constructing Excellence, the standard included recommendations on key areas such as:

• to include best value, key performance indicators (KPIs), and incentives to achieve a common agreed goal when undertaking cost management
• value management studies to establish business and stakeholder needs as well as to agree KPIs
• business cases to consider whether the investment offers value for money
• incorporating value-for-money criteria in change control procedures
• managing risk and value throughout the project.

This work was subsequently used to inform the development of guidance on strategy and tactics for construction procurement, BSI ISO 22058:2022. This was published last year, alongside the first iteration of a specification for value-based decision-making in the built environment: BSI Flex 390.

This work builds on that of the Construction Innovation Hub (CIH), in relation to its value toolkit.

For example, a building surveyor could use a value scorecard when asked to assess a project's value for money. 

Rather than identify the most cost-effective approach where an item of the same value is specified for a lower cost, they could select an option that provides higher value for the same cost. Using BSI Flex 390 and the scorecard means value can be more easily quantified and compared.

An example of one such improvement was to unify best practice in the procurement of building and infrastructure works by strengthening its relationship to existing good practice, such as the CIH value toolkit, BS ISO 22058 and the ISO 10845 construction procurement series.

It is intended for use by those who are responsible for investing or planning to invest in built assets. This includes organisations appointed to advise asset managers, such as investment managers and analysts, commercial managers, cost managers or surveyors, and design managers.

Ultimately, for the built environment sector to meet the vision for it outlined within The Construction Playbook, there must be new approaches to design, building, procurement and operations.

Organisations and their advisers that conform with the revised BSI Flex 390 will be able to improve the value of the works they procure – ultimately ensuring projects are better and completed more quickly and sustainably.