TOWARDS THE USE OF PROJECT ALLIANCE: JOINT DEVELOPMENT OF TEAM SELECTION PROCEDURES AS AN EXAMPLE OF STEPS TAKEN

misbe2011 Tracking Number 234

PERTTI LAHDENPERÄ VTT Technical Research Centre of Finland Finland Pertti.Lahdenpera@vtt.fi Keywords: project alliance, collaboration, selection criteria, shortlisting, competition ABSTRACT Project alliance is a relatively fresh project delivery method where the owner and service providers, the designer and the constructor, hare the risks of the project and the payment to the service providers is tied to the overall success of the project. It is based on a multi-party contract between the key actors to a project, who implement it through a joint organisation and observe the principles of information accessibility in pursuing close cooperation. The project alliance system evolved from the need to improve the implementation of demanding and risky investment projects. Experiences from the model from “down under”, where it has broken through, reached Finland some years ago. Since then, the Finnish Transport Agency, including its predecessors, has intended to introduce the system in its transport infrastructure projects. The first planned projects involve rail renovation and urban road tunnel construction that are about to start in the very near future. The procurement process for service providers has already started with one of the projects and will start later this year with the other. This paper sheds light on the present state of the preparations for applying project alliance in Finland. After reintroducing the key ideas and principles of project alliance and how they reached Finland, the presentation focuses on the initial joint development between the Finnish Transport Agency, the industry and VTT. The development of qualitative team selection process and criteria is singled out for more detailed review as an example of steps taken so far. In that work, the legal praxis concerning competitive tendering in public procurement was found a special challenge which is why it was considered that the implementer selection procedure based on competence (or quality) alone could not be introduced as such. On the other hand, there was the desire to avoid heavy competition involving design and total pricing. Another challenge was to make a clear enough distinction between reducing the number of candidates and tender evaluation as concerns suitability criteria. As a result, a procedure of competitive selection is established for the early involvement of service providers through a collaborative approach. Service provides are selected as a team; in other words, designers and builders are not selected separately and matched. According to the model, selection takes place through elimination of candidates and a subsequent two-phase tendering process: the qualitative tender precedes the workshops that are part of evaluation, followed by submission of tender price data. Then, selected service providers develop the project and its designs in cooperation with the owner before the actual target cost is set and the parties are ready to finally commit to the implementation of the project in question. Later legal consultations have, however, encouraged the owner to depart from the use of the calculated/comprehensive tender price estimate as a selection criterion for the first projects, and the price component is likely to consist only of the fee percentage. Correspondingly, the process also differs from the presented one. Therefore, the proper legal praxis concerning competitive tendering in public procurement, that was said to have been found a special challenge earlier, may still remain so. It is likely that views on the presented solutions will evolve as experiences are gained; as they have until now. Despite all the confusion, the ambience generated by the efforts so far is promising, and it seems that all the parties look forward to taking up the practical work and seizing the benefits a collaborative project delivery is likely to offer.