In its 2021 Construction Industry Survey, Civil Contractors NZ asked respondents whether sustainability practices will impact on them winning business:
- 48% of respondents said “yes”
- 11% said they “don’t know”
- 40% said “no, they won’t”
- and – 37% stated that they had won contracts based on broader outcomes!
Plan A’s experience would suggest these data show that over half of civil contractor sector businesses are in serious trouble – they just don’t know it yet.
We are seeing broader outcomes weightings as high as 30% in some tenders. Auckland Council has stated we should expect weightings of 15-20%. This isn’t on the way team – it is here now.
Discussion amongst contractors at CCNZ’s National Conference in July noted agencies around the country are clearly at different levels of maturity as regards their procurement practices in the sustainability space – but there are plenty of places you can go to see how it is playing out in areas which will affect you. There are no excuses for being in a position today where you are coming into a tender with no groundwork laid to demonstrate your commitment to and involvement with social, cultural, environmental and economic wellbeing.
But the message from tender evaluators is clear – be authentic.
Businesses that have a proven track record in these areas and/or actual plans already underway for implementation on the contract in question will score higher than those who only provide promises. For example, go into your tenders having already partnered with Amotai – don’t say you are ‘going to’. Be on top of your relationship with the local MSD office – and set out the numbers you will bring on board through them into the contract so the evaluators can see what that commitment really looks like. Have already talked to the local Polytech about site open days. Show how you manage your environmental impact and measure progress against meaningful targets.
Across the Plan A tendering team, we’ve successfully worked to develop strong and compelling responses to new tenders laden with Broader Outcomes, Sustainability and PFG fund requirements. It’s incredibly rewarding when that effort is recognised with a tender win – especially when price is no longer the determinant.
There remain real frustrations amongst contractors that procurers are placing the cost burden of these initiatives on them, but even where that is the case – if contractors want to play then these are the rules of the game.
Finally, and because this was also the subject of much ‘table talk’ at the CCNZ conference, I will leave the last words to our Plan A senior consultant Gerard Richardson, who wrote an article a year ago in which he posed the question:
“One way to rationalise the commitment by both sides is for Government agency tenders to include a schedule line item in their pricing for Broader Outcomes Commitment. Tenderers could provide their own $ commitment for that item for the contract, making it a tangible item that can be quantitively compared to other tenders. The Tenderer can then describe how they might allocate the funds…
“Will our local and central government agencies also put their money where their mouth is – and give a clear signal of their equal commitment to positive outcomes for their region?”