NZRA National Conference 2010, Wellington 18-20 October 2010

Cameron Parr General Manager Recreational Services

Warwick Sisson Senior Manager - Sports Fields Recreational Services

Dr Richard Gibbs Senior Manager Sports Surface Design & Management

Lowest price conforming tendering: value for money or the perfect way to stifle innovation, research and development?

Overview

• Different contract types

• Contractor insights in making a decision to tender

• Where lowest price conforming tendering works

• Where lowest price conforming tendering doesn’t work

• Pricing for risk

• The value of relationship management

Quality of

relationship

ROI, rate of

change,

value adding,

competitive

advantage

Relationship forms

Conflictual

Extent of trust

Lowest price conforming - different expectations

The devil is in the detail

Quality of

relationship

ROI, rate of

change,

value adding,

competitive

advantage

Relationship forms

Conflictual

Compliance

Extent of trust

Follow the instructions

Quality of

relationship

ROI, rate of

change,

value adding,

competitive

advantage

Relationship forms

Conflictual

Compliance

Co-operative

Extent of trust

No pain, no gain – share some risk

Innovation

Quality of

relationship

ROI, rate of

change,

value adding,

competitive

advantage

Relationship forms

Conflictual

Compliance

Co-operative

Collaborative

Extent of trust

June 1988 July 1989

Collaboration

Summary

• Number of different contracts and relationships

• Industry has matured

• Contract type needs to be matched to project type

• Lowest conforming often not being used in the right situation

• Can a relationship be adequately defined by price?