>> Procurement Methodologies & Processes

The selection, document design and implementation of the most appropriate procurement methodology for a client, requires ready understanding of the commercial and legal implications of all methodologies pertinent to the project type.

Following the fashion trend of the day can be a risky proposition. Identifying the right methodology for a proposed project often necessitates seeing past the “label” and a willingness to abandon what may be an entire range of assumptions – assumptions that, if incorrect, can compromise both the financial outcome and many aspects of the delivery of a major project.

Experience, intelligence and sharp analysis, along with accurate identification and calculation of risk are called for, if a client organisation is to be provided with the real-world insight into the likely functionality, or non-functionality, of a methodology in the context of their project.

Alternatively, the various processes within an overarching methodology may need to be remodelled or refined, in order to ensure the accomplishment of corporate objectives, and the avoidance, reduction or mitigation of risk, as well as to fully unlock the value inherent in a particular methodology.

>> Commercial Advisory Support in Tendering Practices

In line with the advisability, and the value, of simplicity, it is frequently the case that an unnecessarily high volume of qualifications are included in bid documentation. This is particularly so in the case of those large organisations with a detailed internal protocol for responding to tenders.

This plethora of generic conditions that are of little commercial significance not only generates little value for either side of the negotiation, it often obscures true priorities, along with eroding the attractiveness of a bid.

Accurate and savvy prioritisation of conditions, on the other hand, supports those objectives associated with timeliness, cost and profitability, and provides a sound platform for future budgetary, energetic and resource investment.

>> Support for New Entrants into the Australasian Marketplace

International companies growing their businesses away from their home jurisdiction are faced with navigating highly unfamiliar commercial, regulatory and legal terrain. Their local management is in the position of having to work within what is often a vacuum between the expectations of boards operating within the familiar contexts of their home jurisdictions, and the Australian market’s often completely different attitude towards risk.

Local executives representing these offshore-based organisations need help with the analysis of risk in the Australian environment, as well as to understand it thoroughly, such that the company’s contractual documentation can be finessed into palatability for their boards.

>> Risk Analysis and Mitigation

Dealing with risk in a savvy and agile manner requires, on the one hand, thorough identification and analysis of all risks that stand to impact a project, and – on the other hand – the prioritisation of those risks, such that the primary focus is on those eventualities that are of material concern.

Conversely, the tendency exists for historic, hypothetical responses to risk and risk mitigation, as opposed to strategies based on real-world prioritisation and sensible, targeted allocation.

Practical, prioritised risk mitigation strategies result in fewer qualifications in bid documentation, with those contractual qualifications that are tabled having a higher chance of being deemed commercially acceptable.

This approach signals the likelihood of a contracting party focusing on genuinely relevant issues throughout the duration of a project, and to placing importance on maintaining a congenial commercial relationship.

>> Contract Administration Training, Tools, Advice & Support

Most disputes do not arise because of contract flaws, they arise because a contract administrator is administering some form of “virtual contract” that has evolved in the minds of those involved in its day-to-day management.

The provision of timely, clear and commercially astute advice during the contract administration phase will minimise the prospect of administration diverging from the actual contract. This, in turn, will preserve the position of the client under the contract as it was executed, minimising the complexity of the dispute and reducing associated costs.

In addition to preventing unnecessary diversion of management focus, this assists greatly in the preservation of congenial relationships and project profitability.

Contract administration support may take the form of advisory guidance, hands-on assistance, customised training provided to the client organisation’s personnel, and/or the development of tools to assist in the administration of contracts, including annotated contracts, pro forma documents and flowcharts.

>> Dispute Management - Avoidance, Mitigation, Analysis, Reporting and Resolution

Disputes cannot always be avoided. However, through a thoughtful analytical approach to the avoidance and management of disputes the risk of long term damage to relationships, distraction of senior management and the incurring of significant cost can be reduced. Greenham brings his years of experience to the strategic management of disputes.

The very best dispute avoidance strategy is to have a contract, based on prioritised, real-world, project-specific risks, custom-designed by someone who – through having dealt with a wide variety of projects under stress – has an inherent, instinctive knowledge of what makes for contractual resilience.

The very best mitigation strategy is to identify stress points early – whilst they are still “problems” that have not matured into full-blown disputes – and to find common ground in the opposing points of view that would otherwise fuel a dispute.

And the very best resolution strategy is to seek out the guidance of someone who has designed contracts, who has seen other contracts under stress, and who has worked extensively on dispute resolution teams.

The appropriate analysis and reporting of disputes can enable senior management to make timely and considered decisions as to how an organisation responds to disputes. Project owners and contractors alike, need an advisor with the ability to identify those issues that have the potential for greatest impact on the outcome. And they need an advisor with the courage to make recommendations regarding what to focus on and what not to place focus on, in pursuing the maximumReturn on Investment (ROI) for funds channelled into the resolution of a dispute.

Greenham draws upon probability tools deployed successfully for decades by the insurance industry. These tools bring into sharp focus, those issues representing the greatest risk, those representing the greatest degree of uncertainty, and those that stand to deliver the greatest Return On Investment.

>> Transaction Advice and Management

Transaction advice should seek to place its first priority on minimisation of risk (including political), and maximisation of the prospects of a project meeting the expectations of all stakeholders.

To this end, it’s critical for a project owner to receive solid, experienced, insightful and detail-conscious advice in relation to the design, scheduling and management of transactions – including the resources required to deliver the transaction.

Many transactions lack an effective transaction plan – a plan that clearly identifies the tasks to be undertaken, the personnel who are to undertake those tasks, and the interconnection points between the personnel and the time and resources required. This absence of planning often results in discordant documents that overlap, unhelpfully, in an unco-ordinated and conflicting manner, paving the way for gaps..

Playing the role of “conductor”, an effective transaction manager ensures that the first time the ensemble of documents are put to the test, they are in legal harmony.

>> Problem Avoidance, Analysis and Resolution

A project owner’s or procurement agency’s competitiveness is maximised by the ability to attract contractors who are interested in positive relationships. This, in turn, minimises the prospects of attracting exploitative contractors.

Meanwhile, for a contractor, maximising profitability is predicated on the ability to win a consistent stream of profitable, new projects.

This requires a healthy – and delicate – balance between being overly guarded and reactionary, and – at the other extreme – commercially naïve. While it is wise to remain cognisant that the other party’s commercial interests may be different to yours and will introduce certain pressures, this does not mean the relationship has to descend into acrimony and negativity.

Beyond the development of resilient contracts in the first instance, smart problem avoidance and resolution strategies recognise that speed and agility is of the essence; in practice, the longer and more drawn-out an issue becomes, the more costly and the less optimal is the resolution arrived at.

>> Project Management Office Support

An issue all too frequently observed in the procurement of major projects, is that contract administration – being generally guided by the views of the project manager – is not driven by the contents of the contract.

Rather, it is driven by a “virtual contract” formed in the mind of the project manager, supported by the views of that project manager as to what is “right” and what is “best”. While there’s nothing inherently wrong with allowing common sense and creativity to dictate the direction and actions taken to avoid or deal with disputes, it is certainly materially disadvantageous to do this unwittingly.

This situation often arises when a particular approach to a dispute worked well for the project for which it was devised – but may not work at all well in the very different legal, commercial or relationship context of the current project.

Too often, it is discovered – at the point of a truly stressed project having to resort to legal action – that project navigation and people skills have been over-relied upon. By this time, a project owner or procurement agency finds it has diverted from the contract sufficiently to have created a situation which is discordant with the legal system. The resultant unpredictability of outcome produced by the legal system rarely – in such a scenario – delights any of the parties.

The solution is a comprehensive review of project implementation to identify and inform process refinements, along with guided project administration with a view to identifying risks and non-compliance within prescribed protocols.

>> Contract Negotiation, Claims Analysis & Negotiation

When it comes time to negotiate the final contract, many project owners and procurement agencies spend an over-abundance of time, energy and money thrashing out issues that – either individually or collectively – are far from the true priorities of a project or a procurement.

An astute negotiation advisor identifies those qualifications and conditions that are best taken off the table, in order to bring time and cost efficiency to the process, and to optimise the client’s position at negotiation end.

Ensuring both a strategic and a tactical approach to a negotiation results in the client giving away less in terms of the strength of the contract, than would have been the case with the traditional approach, in which a large number of issues are raised, many of which are ultimately abandoned.

A variety of key objectives are to be struck, in a delicate dance around the negotiating table: Maximising the client’s commercial position while transferring as much risk as is commercially realistic, and – at the same time – preserving the clarity and simplicity of the project, eliminating ambiguity and contradictory elements such that the likelihood of future disputes is minimised.

Risk Analysis and Mitigation

Conversely, the tendency exists for historic, hypothetical responses to risk and risk mitigation, as opposed to strategies based on real-world prioritisation and sensible, targeted allocation.

Services

>> Procurement Methodologies & Processes

>> Commercial Advisory Support in Tendering Practices

>> Support for New Entrants into the Australasian Marketplace