LAS AMENAZAS MEDIOAMBIENTALES A LA SEGURIDAD

The Heart of East Greenwich will deliver a major carbon neutral development on a former hospital site. This will be achieved through on-site generation of heat and power using Biomass CHP, ground source heat pumps, thermal storage and photovoltaics, supplemented during peak periods by gas boilers.

The process for selecting the developer at Heart of East Greenwich was very effective in inspiring excellent responses from all of those shortlisted. The winning bid will establish pioneering standards in environmental innovation and create a new, integrated community in a cutting edge development. The stage one brief set out the vision of creating a new heart for East Greenwich, founded on principles of sustainable, culturally diverse and socially inclusive regeneration. To ensure submissions responded to these effectively they were translated into thirteen SMART (specific, measurable, achievable, realistic and timed) objectives. Accompanying

these were a wide range of assessment criteria. The brief also outlined the likely requirements from bidders at stage two. The stage two brief pack included mandatory standards, design parameters and an illustrative masterplan. Also included was detailed feedback from previous community consultation events run by English Partnerships (now the Homes and Communities Agency) which enabled developers to appreciate social context. Developers were required to present their schemes at a public meeting and towards the end of the selection process their ideas were displayed in a public exhibition. This valuable community feedback enabled those assessing the schemes to gain a better insight into how each scheme might work for the communities living there.

This approach enabled bidders to respond effectively to an extensive range of issues, ensured all submissions clearly reflected the project vision and that community input continued throughout the decision-making process.

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Qualitative assessment

Once a bid has been deemed to comply with objective or mandatory criteria, it can be judged qualitatively. At this stage of assessment it is possible to differentiate between the approaches taken by various bids and to judge how well they will meet the project objectives. It gives bidders an opportunity to illustrate how they will deliver them. The qualitative assessment should address at least four issues:

• Site-specific design issues • Community engagement • Long-term management • Delivery and financial capability

All bids must address those areas, and pass a minimum defined threshold score for each. All bidders should have been given an opportunity in the tendering process to discuss their approach to each, and their understanding of the project objectives, with members of the stakeholder group and the assessment panel. Where possible all competitions should be assessed consistently, using established criteria and practices, and with a consistent panel or mix of individuals on the panel. The assessment panel should include representation from the local authority and key stakeholders where possible.

A minimum threshold should be set for each of the qualitative areas. No trade-offs should be permitted. For example, a scheme should not be considered if it greatly exceeds the threshold for design quality but fails on deliverability. The bid must be of a consistent quality in each area.

Flexibility between projects can be provided by adjusting the relative importance of each qualitative area through the agreed minimum threshold score. For example, in a large complex project it may be inappropriate to have detailed designs submitted. The relative importance of each bidder’s approach to deliverability and financial capacity may be greater. However, irrespective of the scale of the project, each bidder should be asked to illustrate how they would design a section of the development in order to show their understanding of the project objectives.

If the project (or this specific phase of a project) is seen to be very important and is required to act as a benchmark for future phases, it may be appropriate to set a higher overall average threshold. For example, 60 per cent may be the minimum threshold for each aspect of the qualitative assessment, but an average of 70 per cent overall may be required. This means that each bidder knows that they have to innovate in one or more areas in order to proceed to the next stage of selection. Such an approach should only be used when an exemplar scheme is envisaged and may be deemed too complex for future phases.

Table 3.5 An example of Scoring Guidance

Scoring

1-2 Substantially below expectations

3-4 Below expectations

5-6 Meets expectations

7-8 Above expectations

9-10 Substantially above expectations

It is important that bidders and assessors have a clear understanding of expectations. Proposals should not be deemed compliant if they do no more than meet expectations in each area, and do not exceed them in some way to aspire toward an optimal solution on each site. All those involved in the assessment process must have a clear understanding of the standard required by each relative threshold. Fifty per cent design quality to one person may mean something very different to another assessor, so it is essential to set clear definitions of expectations and how they relate to scoring.

Financial consideration

After the objective and subjective assessments, the third stage in the process would address the financial status of the bids. At this stage we need to balance the proposed quality of the bid with the relative financial cost or return to the project. It is important that bids are reviewed in a consistent manner and that we review like with like. The brief should clearly highlight how the financial assessment will be undertaken and what key financial targets must be met. There are a number of options one can consider when making the final section. Whichever is chosen must be defined at the beginning of the process and followed through. Changing an approach to accommodate a specific bid would undermine the fairness of the process and fail to stand up to scrutiny by either a public sector audit (such as those undertaken by the National Audit Office) or by independent auditors on behalf of private sector shareholders.

A number of possible approaches to final selection are outlined below, together with key advantages and disadvantages. In selecting an optimal approach it is important to balance the quality of proposed development with the relative cost or value to society as a whole.

Define quality, then judge purely on price

This approach involves setting objective measures of quality. Providing all of these are achieved, the successful

DELIVERING QUALITY AND ADDING VALUE 3.5

partner will be the one offering the highest return or lowest cost to the project sponsor.

This clear and simple approach is likely to achieve efficiencies for partners who bid successively for

development opportunities. The sponsor is sure of achieving a minimum quality of development delivered at an efficient cost. But it does not encourage bidders to go beyond the minimum quality specified and so may not maximise the opportunity that the project may offer. Bids may become standardised and not respond to site-specific issues. This approach is also quite inflexible. It may not allow the project sponsor to choose their ideal partner because of the procedures set out.

Define price, then judge purely on quality

If a project sponsor has a minimum financial requirement to make the project viable, they can make this figure known to prospective bidders as a minimum criterion, and then judge bids based on qualitative issues alone.

This approach encourages innovation. It can encourage bids which strive to achieve the best possible solution to the site within the cost parameters. Each bidder has an incentive to illustrate how they will achieve high quality at lowest cost. This may help make the innovations mainstream. The approach makes it easy for the project sponsor to forecast the financial returns from the project.

Within the public sector such an approach may be seen to place too sharp a focus on quality. It may not be seen to offer best value to the public purse, as sufficient quality may have been achieved with a much greater return. This approach also requires significant skills from the assessors to determine the highest quality.

Qualitative assessment weighted against relative price in a variable or fixed proportion

The relative value of quality can be balanced against the potential added value in financial terms in order to get a true representation of true value for money to the project or society as a whole. The relative importance of quality as opposed to price can be weighted equally in terms of a 50 per cent / 50 per cent ratio, or the quality aspect can be given a greater weighting, such as a 70 per cent / 30 per cent ratio for an exemplar project, or to set a benchmark

greater than the market would deliver on its own. This approach allows a project sponsor to tailor their approach to individual project needs and aspirations. It requires bidders to make a professional judgement to offer the maximum quality possible at the lowest cost within their abilities. The objective of this approach is to attempt to get the best response in terms of both quality and price.

Such an approach may be seen as very high risk by bidders, allowing too many variables and requiring the bidder to interpret the individual aspirations of the assessment panel. One person’s interpretation of quality over another’s may be very different. Convincing the assessment panel that the bidder has a full understanding of both quality and price issues may be quite costly.

Value judgement and justified recommendation by assessment panel of stakeholder group based on quality/price assessment

This approach, a variation on the other approaches, may include an assessment of objective and qualitative issues. But it relies on a value judgement by the assessment team or stakeholder group, based on information provided, but not to any fixed ratio.

It allows the assessment panel the maximum degree of flexibility to chose the bid that they feel offers the greatest value for money to the project sponsor. Such an approach gives the bidders a strong incentive to provide high-quality, efficient information in their bid in order to convince the assessment panel that their approach offers the best solution.

This approach places a heavy burden on the assessment panel to justify their decision. Some panels may see the responsibility as being too great, and may choose safe rather than innovative schemes in each case. This approach may also be difficult to justify to an audit commission.

Overall

In choosing the right solution for the project in hand, the project team should take due consideration of the skills within their team, the objectives of the project and the value for money requirements of their own organisation.

KEY MESSAGES FOR SECTION 3.5

1. The most successful procurement process will help identify the most appropriate project partner through the most effective and efficient use of resources. 2. There is a direct correlation between the quality

of the brief and the quality of bids received.

3. An optimal balance between quality and price should seek to maximise best value to the project and society as a whole.

Steering a project through its detailed stages