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Q U A L I T Y O F C O N S T R U C T I O N

FIDIC Policy Statement

INTERNATIONAL FEDERATION OF CONSULTING ENGINEERS

Background Longer-term costs such as increased maintenance will


also be incurred.
The FIDIC 2001 survey on the Quality of
Construction within Member Associations confirmed FIDIC wishes to take a leading role in
that the failure to achieve an appropriate Quality of working with other industry stakeholders to address the
Construction was a worldwide problem. As could be potentially serious problem of inadequate Quality of
predicted, the pressure to reduce the costs of Construction.
construction and supervision were found to have had an
adverse effect on quality. The problem was serious, and FIDIC policy
was evident in both developed and developing countries.
FIDIC believes that construction should be
Within the conventional processes for the sustainable, and to this end, it is the policy of FIDIC that
procurement of construction contracts, contractors, who each party in the construction process should be
are keen to win tenders, can do so by submitting low committed to satisfying its obligations with respect to
prices, but at the risk of not being able to a) produce achieving Quality of Construction.
construction work which fulfills specifications, or b)
The FIDIC publication Quality of
meet standards for sustainable development. Likewise,
Construction: a guide for actions, 2004, recommends a
consultants may be under pressure to reduce the initial
best-practice approach to achieving proper Quality of
cost of construction and construction supervision so that
Construction, and proposes actions to be taken by each
contractors are unable to deliver the required quality.
party concerned.
Lack of Quality of Construction has been
Actions by government
manifested in poor workmanship, unsafe structures,
delays, cost over-runs and disputes in construction
Government as client
contracts.
Governments who, as clients, want to
Consultants are often appointed by a client
achieve Quality of Construction should consider the
to only render a partial service during the construction
following:
phase. This increases the risks to the client and the
consultant with respect to the quality and safety of - Adopt a Quality Management approach towards
construction, and frequently increases the overall cost of projects and construction. Quality Management
the project when account is taken of delays and disputes. should include Quality Management Systems such as
those based on the ISO 9001 Standard for their own
The FIDIC Policy Statement Quality of Construction was departments and as a prerequisite for suppliers of
approved by the FIDIC Executive Committee in January goods and services who want to do business with a
2004. Printed copies can be obtained from the FIDIC department.
Bookshop, either individually or as inserts in the binder - Adopting Quality Management may mean a
FIDIC Policy Statements. Electronic versions are available
fundamental review of the process by which
from www.fidic.org/policies. Reproduction is permitted
provided the source is acknowledged. government procures the services of consulting
engineers and contractors (for instance, changing

Quality of Construction FIDIC o n e


from an adversarial, us versus them approach to a - Previous track record: in the context of pre-
partnership-based, we together approach). qualification, while requiring a solid track record
- Recognise that Quality Management is a prerequisite may exclude possible new entrants and make the
for sustainable development, since a lack of industry less competitive, it is essential for
adherence to appropriate quality standards will lead ensuring capability.
to waste in goods and services, whether, for example, - An appropriate combination of price and non-price
through over-design, under-design or incorrect award criteria (also known as tender evaluation
design, or through faulty construction requiring criteria).
higher maintenance costs or early replacement. This selection process has the advantage that it can
- Adopt a sustainable development approach towards be extended to include separate sections for
construction by: sustainability dimensions such as the submission of
- Taking cognisance of the need to internalise total a social plan and an environment management
project cost as is pointed out in FIDIC's Sustainable plan. Depending on the nature of the contract, for
development in the consulting engineering industry - a example, routine as opposed to complex and high
strategy paper, 2000. For example, calling for risk, price could constitute 80% of the tender with
tenders to achieve lowest price may seem like an the remaining 20% used for the non-price award
attractive option, but once all external costs such criteria.
as tender preparation costs and future costs owing - Promote the adoption of standardised
to lack of quality are internalised, the outcome may documentation by all clients, especially government
be very different. departments and government authorities, for:
- Reducing the volatility in the construction industry - procurement procedures for consulting engineers
by, for example, overcoming boom-and-bust, or - procurement procedures for contractors
feast-and-famine, cycles. These notorious cycles - client/consultant agreements
increase the construction industrys risk, with the - construction contracts
resulting loss of the most talented and highest - tender and construction documentation.
calibre staff, thus impacting negatively on Quality
of Construction and the industrys sustainability. Government as regulator
- Insist that, for the purposes of ongoing management,
operation and maintenance, local capacity must be Government often has a second, very
developed on all projects. Local may have the important function in that it can create, through laws
meaning of local areas within a country or a larger and regulations, an enabling environment in which a
geographic region. Useful guides include FIDICs construction industry can flourish and often, as a
Capacity building: building the capacity of consulting consequence, the economy in general. Such an enabling
firms, 2001, and Improving transfer of technology: guide environment should provide more appropriate Quality of
for actions, 1992. Construction since the rules of the game are known and
- Adopt a Quality Based Selection approach for the a good referee can help raise the quality of the game.
procurement of consulting services, and include in
the selection criteria the need for consultants to have Legislative and regulatory action that
the following in place: government may need to consider includes the
following:
- Quality Management System
- Business Integrity Management System - Creation and application of effective anti-corruption
- Environment Management System policies and practices.
- Risk Management System - Creation of a specific set of construction activity
- Professional indemnity insurance targets.
- Membership of a recognized body representative - Formation of a body geared towards creating a more
of the profession or industry. enabling construction environment.
- Registration of professionally qualified firms and
- Adopt a quality-oriented selection process for the persons in their respective categories.
procurement of construction contracts, including: - Recognition of equivalent foreign qualifications and
- Pre-qualification: this is no guarantee of quality, registrations.
but it at least excludes those who are obviously
less likely to execute the contract successfully.

t w o Quality of Construction
Actions by international agencies - procurement procedures for consultants
- procurement procedures for contractors
International funding agencies are often as - client/consultant agreements
powerful as government in setting the right climate for - construction contracts
what is expected from a construction project. Hence, the - tender and construction documentation.
actions for international funding agencies are similar to - Additional actions, which include:
those for government as a client. In summary, they are:
- Insisting on the implementation of effective anti-
- Adopt a Quality Management approach towards corruption policies and practices.
projects and construction. This may mean a
- Insisting on capacity building and technology
fundamental review of the process by which the
transfer, possibly using FIDIC guides for action and
agency procures the services of consulting engineers
guidelines.
and contractors.
- Taking cognisance of local economic cycles, and
- Recognise that Quality Management is a prerequisite
smoothing these cycles rather than exacerbating or
for sustainable development since the lack of
deepening them.
adherence to appropriate quality standards will lead
to waste in goods and services. - Reducing the project initiation period as continuity
of firms and their staff improves Quality of
- Adopt a sustainable development approach towards
Construction.
construction by:
- Reducing prolonged payment periods for claims
- taking cognisance of the need to internalise costs.
from consulting engineers and contractors as this
- reducing volatility in the construction industry.
reduces the incidence of unacceptable shortcuts,
- Insist that, for the purposes of ongoing management, and therefore improves the Quality of
operation and maintenance, local capacity must be Construction.
developed on all projects. Useful guides include
FIDICs Capacity building: building the capacity of Actions by industry
consulting firms, 2001, and Improving transfer of
technology: guide for actions, 1992. The various role-players in the construction
- Adopt a Quality Based selection approach for the industry, including FIDIC, FIDIC Member Associations,
procurement of consulting services, and include in member firms and contractors, are mainly on the supply
the selection criteria the need for consultants to have side of interventions intended to improve Quality of
the following in place: Construction.
- Quality Management System
- Business Integrity Management System FIDIC and FIDIC Member Associations are
- Environment Management System not direct providers of services, but have important roles
- Risk Management System to play in defining and disseminating best practice as
- Professional indemnity insurance facilitators, coordinators and providers of channels of
- Membership of a recognized body representative communication.
of the profession or industry.
FIDIC
- Adopt a quality-oriented selection process for the
procurement of construction contracts, including:
Actions for FIDIC include:
- Pre-qualification: at least excludes those who are
obviously less likely to execute the contract - Draw attention to the benefits of Quality of
successfully. Construction at all times.
- Previous track record: in the context of pre- - Continue liaison with international agencies.
qualification, a solid track record is essential for - Channel information between Member Associations.
demonstrating capability. - Facilitate the production, review and improvement of
- An appropriate combination of price and non-price appropriate documentation, including contracts.
award criteria. - Engage in education and training initiatives, and in
- Make provision on all construction projects for the production of appropriate materials for Member
adequate supervision by a consulting engineer. Associations and their member firms.
- Promote the adoption of standardised
documentation for:

Quality of Construction FIDIC t h r e e


Q U A L I T Y O F C O N S T R U C T I O N

References and resources

Quality of Construction: a guide for actions, 2004. Guide to Quality Management in the consulting
FIDIC Policy Statements, 2004. engineering industry, 2nd Ed 2001.
Engineering our future, 1998. Consulting engineers and the environment, 1st Ed 1994.
Capacity building: building the capacity of consulting firms, Sustainable development in the consulting engineering
2001. industry: a strategy paper, 2000.
Client/Consultant Model Services Agreement, 3rd Ed 1998. Quality Based Selection for procurement of consulting
Construction Contract, 1st Ed 1999. services, 1st Ed 1997.
Guidelines for Business Integrity Management in the Tendering procedures, 2nd Ed 1994.
consulting industry, Test Ed 2001.
Guidelines for the selection of consultants, 1st Ed 2003. Resources are available at www.fidic.org/policies/qoc

FIDIC Member Associations - Review the Quality of Construction after the


completion of projects for continuous improvement
Actions for Member Associations include: of the construction quality.
- Draw attention to the benefits of Quality of - Participate actively in Member Associations.
Construction at all times. - Assist with:
- Act as communication channels between FIDIC and - lobbying government
member firms, and between the firms and their - reviewing FIDIC documentation and its local
clients. equivalents
- Assist with the education and training of members. - providing feedback on systems and documents
promoted by FIDIC for future review.
- Assist with the implementation of improved quality
and quality-related systems such as Quality Based - Provide feedback to sub-consultants and contractors
Selection, Quality Management Systems, Business on performance regarding Quality of Construction.
Integrity Management Systems, Environmental Contractors
Management Systems, Risk Management and
professional indemnity schemes. Actions for contractors include:
- Lobby government for the adoption of the actions - Recognise the importance of Quality of Construction.
outlined in the section Actions by Government.
- Adopt Quality Management Systems.
- Assist in the development of standard specifications.
- Provide procedures for corrective action when quality
- Encourage the use of internationally accepted control and/or acceptance criteria are not met.
contract documents. - Provide feedback to consultants for improvement of
- Publicise examples of good and poor practice. Quality of Construction.
- Recruit, train and deploy a skilled work force.
Member firms
- Take measures to ensure that subcontractors are
qualified, and/or licensed as required.
Actions for firms include:
Further actions should be developed in
- Produce standard but comprehensive tender and
consultation with the representative bodies of the
contract documents of the highest quality using
international contractors.
established documentation.
- Include the requirement for project quality plans in FIDIC - International Federation of Consulting Engineers
bidding documents and contracts. World Trade Center 2, Geneva Airport
Box 311, CH-1215 Geneva 15, Switzerland
- Adopt Quality Management Systems, Environmental
Telephone: +41 22 799 49 00 Email: fidic@fidic.org
Management Systems, Business Integrity Telefax: +41 22 799 40 01 Web: www.fidic.org
Management Systems and Risk Management.

f o u r Quality of Construction