OGC gateway review 2

The Office of Government Commerce (OGC) has now been absorbed into the Efficiency and Reform Group (ERG) within the Cabinet Office.

When it existed, the OGC produced a great deal of guidance about best practice in procurement and project management. This OGC guidance has now been archived, however, it is still cited in the new Government Construction Strategy and the revised Common Minimum Standards (to become the 'Construction Standards') and links are still provided from government websites such as the Major Projects Authority. The OGC gateway review process still provides one of the best and most comprehensive sets of guidance for public projects. It is for this reason that the project plan for public projects within Designing Buildings Wiki follows the OGC gateway review process. See Public project: outline work plan.

The procurement routes preferred by the Government Construction Strategy and described by the OGC gateway review process are private finance initiative (PFI), prime contracting and design and build (see OGC Achieving Excellence Guide 6:Procurement and contract strategies). The Government Construction Strategy states that traditional procurement routes that separate design from construction should not be used unless it can be demonstrated that they offer better value for money.

The three preferred routes involve appointing a single integrated supply team (including designers, contractors, suppliers and perhaps facilities managers) after the project brief has been prepared, before design commences. This means that the main decision to invest (i.e. to appoint the integrated supply team), takes place before any designs have been prepared.

The OGC Gateway Review process offers a structure for projects following these procurement routes, based around a series of independent peer reviews carried out at key stages to verify that projects should be allowed to progress to the next stage.

These peer reviews, or 'gateway reviews' are commissioned on a confidential basis by the Senior Responsible Owner:

• OGC gateway review 0: strategic assessment.
• OGC gateway review 1: business justification
• OGC gateway review 2: delivery strategy (or procurement strategy)
• OGC gateway review 3: investment decision
• OGC gateway review 4: readiness for service
• OGC gateway review 5: operations review & benefits realisation (or benefits evaluation)

There are also two additional decision points specific to building projects:

• OGC decision point 1: outline design.
• OGC decision point 2: detailed design.

In practice, some of the design work leading up to these decision points is likely to be carried out during the tender process (or bidding process on PFI projects).

OGC gateway review 2: delivery strategy (also called 'procurement strategy' (ref OGC Constructoin pocketbook)...

...investigates the Outline Business Case and the delivery strategy before any formal approaches are made to prospective suppliers or delivery partners. The Review may be repeated in long or complex procurement situations.

ref OGC introduction to procurement gateway 2.

The review should:

• Confirm the business case is fully defined.
• Confirm that the objectives and desired outputs of the project are still aligned with the programme to which it contributes
• Ensure that the delivery strategy is robust and appropriate
• Ensure that the project's plan through to completion is appropriately detailed and realistic, including any contract management strategy
• Ensure that the project controls and organisation are defined, financial controls are in place and the resources are available
• Confirm funding availability for the whole project
• Confirm that the development and delivery approach and mechanisms are still appropriate and manageable
• If appropriate, check that the supplier market capability and track record are fully understood (or existing supplier's capability and performance), and that there will be an adequate competitive response from the market to the requirement
• Confirm that the project will facilitate good client/supplier relationships in accordance with government initiatives such as Achieving Excellence in Construction
• For a procurement project, confirm that there is an appropriate procurement plan in place that will ensure compliance with legal requirements and all applicable EU rules, while meeting the project's objectives and keeping procurement timescales to a minimum
• Confirm that appropriate project performance measures and tools are being used
• Confirm that there are plans for risk management, issue management (business and technical) and that these plans will be shared with suppliers and/or delivery partners
• Confirm that quality procedures have been applied consistently since the previous review
• For IT-enabled projects, confirm compliance with IT and information security requirements, and IT standards
• For construction projects, confirm compliance with health and safety and sustainability requirements
• Confirm that internal organisational resources and capabilities will be available as required for future phases of the project
• Confirm that the stakeholders support the project and are committed to its success
• Evaluation of actions taken to implement recommendations made in any earlier assessment of deliverability.

ref OGC gateway review 2: delivery strategy.

On construction projects, specific tasks that are included in OGC gateway 2: delivery strategy are:

• PS (project sponsor) appoints project manager.
• Link the project brief to the strategic (strategic brief) and decide quality and performance levels.
• PS (project sponsor) to develop project brief with support as required from independent client advisers. PM (project manager) to develop brief for option/feasibility study.
• Carry out feasibility study. Note that advice could be given by existing integrated supply team or ICA (independent client advisor).
• Apply VM (value management) to refine and evaluate options that satisfy project brief and objectives. Assess design opportunities for each option. Identify risks for each option, cost of managing them (through avoidance, design/reduce, accept, share or transfer). Liaise with statutory authorities. Select best option. Revise risk allowance. Develop whole-life cost models.
• Identify risks for each procurement route (PFI (private finance initiative), PDS (private developer scheme), Leasehold, Crown build). Assess alternative funding options and risk allocation strategies. Select best procurement option (best suited to meeting project objectives, while providing value for money).
• Develop Outline Business Case on basis of recommended procurement strategy and budgetary estimates.
• Review of risk management approaches to assess contribution to meeting objectives. If necessary, request additional studies. Review whole-life cost model. If total estimate greater than budget, reconsider the decision to invest or revise scope of project and ensure that revision still meets the brief/stakeholders' needs. Set revised budget.
• Determine appropriate contract strategy. Recommended integrated contract strategies for a Crown build are Prime Contracting and Design & Build.
• Develop output-based specification, using VM (value management). Review and update risk register and revise base estimate and risk allowance. Appoint Planning Supervisor to ensure Health & Safety Plan is prepared.
• Check whether the requirement falls under Works, Services or Supplies Directive; whether the estimated contract value exceeds the relevant threshold for OJEU advertising (bearing in mind aggregation rules); Restricted or Negotiated procedure (limited circumstances, including PFI (private finance initiative)); prepare draft OJEU (the Official Journal of the EU) notice if required. Determine selection and evaluation criteria. Produce tender documentation if this is a new procurement.
• Review approval for project to proceed. Review acceptability of retained risks. If estimate exceeds budget, revise design or revise scope of project, while ensuring that revised design or scope still meets brief/stakeholders' needs. Reassess affordability of project. Revise budget if required. Update risk register.

ref OGC Achieving Excellence Guide 3 - Project Procurement Lifecycle P11, 12 and 13.

For a detailed description of the sequence of tasks necessary on public projects, see the work plan Public project: outline work plan. Gateway review 2 takes place at the end of the work stage: Public project: feasibility studies.

[edit] Related articles on Designing Buildings Wiki

• Design and build.
• Gateways.
• Government Construction Strategy.
• OGC.
• Output based specification.
• Private Finance Initiative.
• Prime contract.
• Public procurement.
• Major Projects Authority.

[edit] External references

• OGC Gateway Process Review 2: Delivery strategy. Introduction
• OGC Gateway Process Review 2: Delivery strategy. PDF
• OGC Achieving excellence in construction: Construction projects pocketbook.