Risk and Procurement Management

Risk and Procurement
Management BSS054-6

Table of Contents
INTRODUCTION...........................................................................................................................3
CASE STUDY.................................................................................................................................3
MAIN BODY..................................................................................................................................4
Question 1....................................................................................................................................4
Question 2....................................................................................................................................7
Question 3..................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Procurement Management (PR) is a part of company that look out and manages the way
with the help of which the raw material is being acquired from the suppliers in order to produce
finished goods. This report is based on the cased study of Balfour Beatty Construction Company
that provide designing and construction of many bridges, rails etc. services to their local and
international customers. This report will cover the three stages of bespoke procurement process
and also methods of process which helps the company in managing the challenges they face
while procuring raw material and also for managing risk. The report will also describe the
comparison of types of contractors and form of collaboration. Further, this report will develop a
prototype contract based on the case study scenario and also include terms and conditions. The
report will also discuss how the terms and condition mentioned in the contract help the Balfour
Beatty in managing the risk attach with the contracts. At last, the report will cover the types of
contract breach and ways to improve it.
CASE STUDY
Balfour Beatty is one of the UK’s leading construction companies located in London, UK
that provides services related to construction management, general contracting, cost-consulting,
design build, pre-construction services etc. The company has been considered as a top ten green
builder having 2500 employees of workforce. The project portfolio of company includes
buildings, rails, highways, bridges and water solution and innovation. The company with digital
transformation at the forefront of procurement enabled hard savings and increases efficiency. By
using automated-sources to pay solutions the company shape its procurement and business in
such a way, with the help of which they can easily operates in technological-enabled
environment. The objective of the company is to became customers best choice by concentrating
their focus towards the best performing supply chain partners. The policy of the Balfour Beatty
construction company describes their commitment to deliver sustainable outcome to the clients
through their procurement activity. In order to manage the risk in construction, the company has

hire risk management experts which are also highly trained by the company to identify and
proactively manage the risk attach with the projects and contracts. Balfour Beatty’s risk
management team committed towards adopting and managing policies and procedures which
manages the internal control framework of the company.
MAIN BODY
Question 1
Procurement Process
Procurement cycle is a set of series which every business has to follow in order to acquire
goods and services in their warehouse. The Balfour Beatty construction company in order to
construct bridges, highways, buildings etc. first need to acquire raw material such as cement,
bricks, wood bricks etc. via contracts. It is because without raw material the company are unable
to do their further task that’s why procurement process is very crucial task for procurement
management of the company along with managing the risk attach with it (Roy, 2018).
Three stages of bespoke procurement process
The following construction procurement process can be adopted by the Balfour company
in order to further proceed with their work. These three stages involve goods and service
decision, the ability to call for bids and last evaluation and selection of best and suitable
suppliers’ proposal.
 Goods and Services decision: Here, the Balfour Beatty construction company’s
procurement management need to analyse the raw material which they need to buy from
the suppliers and the raw material they produce by themselves. It is because their no
compulsory that all the goods and services must be sourced from outside. This process
plays important role in determining the cost-effective way or methods of procurement.
After selecting method, the Balfour Beatty need to analyse prices and quality of raw
material of in the market with through research (Roy, 2018).
 The Ability to call for bids/ Solicitation: After analysing the supplier available for the
construction raw material now they need to call all the suppliers for the proposal known
as bids and properly look out each proposal. It is advisable to the Balfour construction