The Importance of Contracting Approach

Question: Discuss about the Importance of Contracting Approach ? Answer : The contracting approach is a term used for the various methods for the betterments of properties of risk appetites, contracting parties and decisions (Power-eng.com, 2017). The significance of the contracting approach is exaggerated. Most approaches of contracting have been successful. However, it is not guaranteed from the past. So it has emerged as a subject of debate. The factuality of the above allegation has been discussed in the answer. It has been shown that the approaches actually exert little impact on project outcomes. As any project undergoes production, authentic initial cases are to be delivered. Merrow has calculated the success of projects according to the degrees up to which the forecasts accomplish its prediction on these cases. He has claimed that the megaprojects of the industries are just bad investments. Apart from few projects, most of them have an abrupt distribution of success. The consequences are either extreme good or very poor (Merrow 2011). Merrow has criticized these industries for applying their technical skills to a position from where they have been unable to perform effectively. The organizations have become too much dependent on the consultants. Moreover, the companies were too much in hurry to perform projects before testing their business care robustly. As a result, the contracting approach has minute impacts on the results of megaprojects. The most important factor lies here, is the quality of people along with the efficacy of project organization. So, contracting approach is a secondary concern (Merrow 2011). Thus the fact that contracting approaches bring success but cannot guarantee it is proved. Merrow was simple about the drawbacks in applying the contracting approach. Merrows observations are highly applicable to governments and huge infrastructure projects throughout the world. References: Merrow, E.W., 2011.Industrial megaprojects: concepts, strategies, and practices for success(Vol. 8). Hoboken, NJ: Wiley. Power-eng.com. (2017). Project Contracting Strategies: Evaluating Costs,Risks and Staffing Requirements. [online] Available at: https://www.power-eng.com/articles/print/volume-115/issue-3/features/project-contracting-strategies-evaluating-costsrisks-and-staffing-requirements.html [Accessed 14 Mar. 2017].