PhD Final Thesis April 2013.pdf - Anglia Ruskin Research Online

Thesis Keith Gale 2013of variances between the groups. Results from empirical evidence obtained thoughthese methods is matched against hypothesis H3, hypothesis H4 and hypothesis H5allowing a summary to be made at the end of this chapter.8.2 Published research regarding transaction costs of projectsA lack of published transaction cost information available to the constructionindustry was a concern voiced by Hillebrandt and Hughes (2000), who concludedthat ‘there is very little information either on the costs of different methods ofprocurement or the benefits derived from them’. Further research attempting tocalculate transaction costs between different procurement methods stated that ‘Oneof the major conclusions of the research, based on a survey of bidding costs, is thatthere is no evidence that simply the presence or absence of collaboration affectstendering costs’ (Hughes, et al, 2006, Executive Summary page x). On the supplyside, a survey from contractors reported that 49% of respondents (n = 358) founddifficulties with framework prequalification processes with an average cost of £1360being spent in pre-qualification (NFB, 2010). Concern with the high costs oftransaction and engagement of suppliers formed the predominant conclusion of theNFB report but this was voiced at public sector clients generally rather than allied toa specific procurement system.8.3 Central government views and professional practice on production costs ofprojectsCurrent views from UK government regarding production costs are provided throughthe Government Construction Strategy (Cabinet Office, 2011), with particularreference toward frameworks being highlighted by specific mention:Paragraph 1.6 states ‘…..clients and suppliers need to work together on a sharedimprovement plan, and that this means working with fewer suppliers in a moresettled supplied chain. This has generally been achieved by the creation offrameworks, tendered in accordance with the requirements of public procurementlaw – which then stay in place for a fixed period (of up to 4 years).’ Paragraph 1.7continues ‘The principles behind this remain valid, but there is a tension between thebenefits of working with fewer suppliers in long-term relationships, the desire to169