Procurement in the Greater Manchester Construction Sector

Assignment Brief

Module title Procurement

You should prepare a report for the Mayor of Greater Manchester that

• describes and critically reviews the current approaches to procurement in the construction sector.
• includes an outline Procurement Strategy for a public or a private sector client (or another key stakeholder) in the region of concern to the mayor; this is a draft but should identify and describe the necessary key elements to drive social, environmental as well as economic outcomes.

Scenario Details

You are employed by the PLACE Group – whose core services in consultancy are project and programme management; and procurement and cost consultancy. PLACE have secured a prestigious appointment to provide advice to the Mayor of the Greater Manchester City Region who is seeking to develop a deal with the construction sector in the GM City Region as part of his re-election campaign for 2020.

The new Mayoral mission is pinning its hopes on encouraging public and private sector clients to use their procurement leverage to “procure for value”. The ambition is to embed a more strategic approach to procurement amongst both public and private sectors.

The belief is that the construction and infrastructure sectors can help “to drive improved (social as well as economic) value, improved productivity, more job creation and economic growth in the region; in turn this would support the building of sustainable supply chains and open opportunities for local firms. Such a sector would demonstrate circular economy principles and procurement and contractual models would be versatile enough to accommodate preconstruction, modularisation, offsite manufacturing, BIM and other evolutionary changes within the sector”.

Module Aims

1. Explore the role of various procurement systems in various types of construction projects.
2. Critically examine strategic procurement approaches for effective and efficient design and construction solutions.

Knowledge and understanding

Upon successful completion of the module, you will be able to:

1. Critically evaluate client objectives and determine the appropriate selection of procurement systems for design and construction services.
2. Critically evaluate supply chain relationships and partnering schemes and develop strategies for various stakeholders in the construction industry.
3. Advise the client on the selection of the appropriate procurement routes.
4. Advise relevant parties on the rationale regarding early strategic procurement decisions.
5. Determine the appropriate procurement system based on client objectives.
6. Develop communication skills to plan the management of supply chains.
7. Provide advice on developing strategies for partnering.

Sample Answer

Procurement in the Greater Manchester Construction Sector: A Strategic Review

Introduction

Procurement plays a central role in shaping the performance of the construction industry. It determines not only how projects are delivered but also how value, efficiency and wider social benefits are achieved. In Greater Manchester, the Mayor is keen to use procurement as a tool to drive economic growth, improve productivity and deliver social and environmental outcomes. This report, prepared on behalf of the PLACE Group, examines current approaches to procurement in the UK construction sector and outlines a draft procurement strategy that could support the Mayor’s vision for “procuring for value”.

Current Approaches to Procurement in Construction

Procurement in the construction sector has traditionally been driven by cost, with competitive tendering and lump-sum contracts often prioritised. While these approaches can create price competition, they often result in adversarial relationships, fragmented supply chains and limited collaboration. Such models can also lead to cost overruns and quality issues, as contractors seek to recover margins.

In recent decades, alternative procurement systems have emerged. Design and Build contracts integrate design and construction under one supplier, which reduces client risk but can limit design innovation. Management contracting and Construction Management approaches provide flexibility but require clients to accept higher risk and close involvement. Partnering arrangements and framework agreements have gained traction, especially within the public sector, as they encourage long-term collaboration and repeat business.

Public procurement in particular has been influenced by government initiatives such as the Public Contracts Regulations and the Construction Playbook, which emphasise transparency, early contractor involvement, and value for money beyond simple cost measures. Increasingly, sustainability, social value and innovation are being incorporated into procurement evaluation criteria. However, there remains a challenge in embedding these practices consistently across the industry, especially among smaller firms.

Procurement Challenges in Greater Manchester

The Greater Manchester construction sector faces several challenges. Productivity remains below that of other industries, and supply chains are often fragmented. Many firms rely on subcontracting models that do not support skills development or long-term investment. There is also the challenge of meeting environmental targets, including reducing carbon emissions in line with the city-region’s climate commitments.

Social value is another pressing issue. While larger contractors may have frameworks for local employment and training, smaller firms can struggle to meet requirements due to limited resources. This risks excluding local businesses from opportunities. There is therefore a need for procurement strategies that balance the goals of inclusivity, efficiency and innovation.

Continued...