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Using construction procurement strategy to achieve socioeconomic development objectives.
Samuel Laryea1, Ron Watermeyer1
1School of Construction Economics and Management, University of the Witwatersrand, Johannesburg, South Africa.
Heliyon
|July 23, 2024
Summary
A South African construction procurement strategy successfully integrated socio-economic development goals like local employment and skills development. This case study shows procurement can drive social value and development objectives in infrastructure projects.
Area of Science:
- Construction Management
- Public Policy
- Socio-economic Development
Background:
- Construction procurement strategies often overlook socio-economic development objectives.
- There is a need to integrate secondary procurement goals into project frameworks.
- Limited theoretical and practical attention has been given to this integration.
Purpose of the Study:
- To present a case study of an innovative targeting strategy for socio-economic development in South African construction.
- To examine the contractual integration of key socio-economic development indicators.
- To demonstrate the role of procurement strategy in achieving social value.
Main Methods:
- Document analysis of main works contracts.
- Examination of four socio-economic development targets: local employment, skills development, local expenditure, and Broad-Based Black Economic Empowerment (B-BBEE).
- Case study of a New Universities Project in South Africa.
Main Results:
- Four out of five framework contractors successfully achieved the specified socio-economic development targets.
- Performance-based specifications and monitoring systems were effectively integrated.
- Low-performance damages were applied in one instance of non-compliance.
Conclusions:
- Appropriate construction procurement strategies are essential for realizing socio-economic development objectives.
- Effective integration of packaging, targeting, and contracting strategies drives social value.
- Infrastructure projects can be leveraged to promote local employment, skills development, and local expenditure.
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