PROJ6004: Analysis of Contracts and Procurement for RAH Project

This report provides a comprehensive analysis of the contract and procurement management of the New Royal Adelaide Hospital (RAH) project. The report begins with an introduction to the project, highlighting its scope, budget, and the involvement of public-private partnerships. It identifies key issues such as project delays, budget revisions, and the lack of a contract management framework for clinical equipment procurement. The report examines the risks associated with the project, including those related to delays in completing components and failure to meet contractual requirements. It evaluates the roles of the project and procurement managers and discusses factors contributing to project issues, emphasizing the importance of efficient management and project governance. The report references an audit report and discusses the procurement method and contract management processes, offering insights into the project's complexities and outcomes. The report concludes by highlighting the impact of effective procurement management on project processes and stakeholder satisfaction.

Running head: CONTRACT & PROCUREMENT MANAGEMENT
Contract & Procurement Management (Project Management)
Name of the Student
Name of the University
Author Note

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Introduction
The Royal Adelaide Hospital project is one of the largest social infrastructure projects
that are undertaken by the state. The project is to be built, maintained and financed by making
use of a public, private and partnership arrangement. The procurement contract for the New
Royal Adelaide hospital is true for designing, construction and the maintenance of services for
the new Royal Adelaide Hospital. The project works on the new royal Adelaide Hospital is now
complete and has officially opened for the patients to move in. The life cycle of the project
includes the identification of the audit approach and the scope of the project. After that the
budget and the cost of the project is evaluated in order to set a realistic project budget. The works
of designing along with construction works were under the supervision of the subcontracted
builder (Mignone et al., 2016). However, there were certain issues associated with the project
which mainly arose due to the presence of certain complexities in the project. The project was at
risk due to the delay in the completing components of the clinical equipment information and
communication technology. There were issues with the budget of the project that added to the
complexities in the project. The total nominal budget for the new RAH project is $2.3 billion
(Audit.sa.gov.au, 2018). The budget revision in the project has resulted in a project delay which
is among the key issues of the project. The new Royal Adelaide Hospital project lacked a
contract management framework and contract management plan for clinical equipment
procurement program. There was a scope of enhancing the contract management practices by
ensuring proper monitoring and control along with the documentation of certain specific clauses
of PPP project agreement. Furthermore, the new RAH project had a significant number of
complexities and risks ahead with the completion of the construction. Another significant issue
that the project faced includes failure to meet the PP contractual requirement that resulted in the

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project being exposed to incurring different financial exposures. There were a number of factors
that resulted in delay of the project, however, the construction of the hospital was well
progressed. The project was well progressed mainly because the good project monitoring,
efficient leadership and proper governance of the project. Since this project is the largest social
infrastructure project efficient management and project governance was necessary. This project
aimed at replacing the existing Royal Adelaide Hospital, which is the largest hospital of South
Australia with 640 beds. The project faced the issues of inadequate delivery of the intended
benefits and outcomes along with the misalignment with the change to the healthcare policy of
the state. The report will give an overview of the key risks and the mitigation procedure of the
identified risks. The roles of project and the procurement managers in the new royal Adelaide
Hospital project will be evaluated in the report as well. There are a number of factors that
contribute to the issues in the project which will is discussed in the report. Since this project was
the largest infrastructure project undertaken by the state, it bound to have a certain number of
complexities. The procurement method and the process of contract management for one of the
largest projects in the state are discussed in the report. Evaluation of the audit report for the
project unveils the complexities, issues and certain properties of the project that was undertaken.
The results are analyzed and discussed in this report. Effective procurement management has a
large impact on the project’s processes and further helps in managing the project’s stakeholders
and to meet the goals of the project (Masterman & Masterman, J2013). An effective procurement
management added to the successful completion of the project.

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References
Audit.sa.gov.au, (2018). Retrieved from https://www.audit.sa.gov.au/LinkClick.aspx?
fileticket=ZwZLmopMXBE
%3D&tabid=452&portalid=0&mid=1475&forcedownload=true
Masterman, J., & Masterman, J. W. (2013). An introduction to building procurement systems.
Routledge.
Mignone, G., Hosseini, M. R., Chileshe, N., & Arashpour, M. (2016). Enhancing collaboration in
BIM-based construction networks through organisational discontinuity theory: a case
study of the new Royal Adelaide Hospital. Architectural Engineering and Design
Management, 12(5), 333-352.