Frameworks are a very significant part of the contracting and consulting landscape, having a widening impact on how work is secured, how capacity is allocated and how appetite for new work might vary.
As opportunities associated with frameworks grow and as many contractors and consultants secure a greater proportion of their revenue from long-term relationships, the position of both the occasional client and the smaller-scale consultant or contractor could be at a disadvantage.That said, many clients have taken steps to tailor frameworks to their workload, accessing a wider and more varied supply chain as required.
A framework can be defined in the simplest terms as a supplier agreement, under which goods and services can be obtained on the basis of pre-agreed terms and conditions, price and quality levels.While many clients and their supply chains enjoy long-term commercial relationships, the critical difference between conventional best practice and framework-based practice is that most of the terms of engagement, often including aspects of price, will have been dealt with at the outset of the programme.
Suppliers to frameworks are appointed on the basis of capability and their capacity to do the work.This can result in the much criticised “one size fits all” approach, where larger suppliers get the lion’s share of the work.The duration of the framework will be dependent on the client and sector. In the public sector, procurement rules normally limit framework periods to four years.
An important distinction in frameworks relates to the extent of the clients’ obligation. Agreements involve a contractual commitment to the purchase of a defined extent of goods or services. Framework arrangements differ in that, while the basis of appointment is known, there is usually no binding commitment from the client to purchase the services.
Credibility of the prospects for future workload is critical to an effective framework and clients must take steps to ensure quality and reliability of their own programme, which may require reorganisation of internal project planning and approval processes. Nuffield Hospitals has re-engineered its procurement process to enable the establishment of consultant and contractor frameworks, centralising their procurement process and, as a by-product, putting in place a rigorous business case and change management model, preventing abortive work and focusing capital investment on priority projects. Planning for the end of a framework is also important if the client is to maintain progress on their capital programme.
Frameworks have been used extensively in the public sector to broaden the partnering agenda from a single project to wider portfolios.While a private sector client might view their framework as a strategy to secure capacity, public sector organisations have a broader agenda related to improvement of service delivery and efficiency savings driven by Gershon Review targets.These total £6.45bn up to the end of the 2007/2008 financial year.
At their most ambitious, clients are seeking to transform the way in which work is delivered and supply chains are organised. The South East Centre for Excellence, an open-access framework for local authorities covering most of southern England and promoted by Hampshire council, illustrates how sophisticated and far-reaching in their impact frameworks have become.
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