Unit 3: Traditional Project Delivery Using IT …...iii. Any delay in a construction project can have serious repercussions to both developer and contractor alike: •Contractors who

Unit 3:

Traditional Project

Delivery Using IT

Applications

i. In a typical construction project, the major key to its success hinges on how well the project process flow is planned.

ii. Because buildings are designed and built in such a way that time constraint and costing must be kept under control, the various steps involved, from the design phase all the way to the handing over phase, must be carefully planned to avoid exceeding the deadline and costs from spiraling out of control.

iii. Any delay in a construction project can have serious repercussions to both developer and contractor alike:

• Contractors who do not complete the work on time without sufficient grounds may be sued for liability damages (LD);

• Developers or owners may also lose out due to various commercial reasons, e.g late completion of condominiums, resulting in less units sold.

3.1 Construction Project Process Flow

Schematic Illustrating Project Phases (1 & 2 is Design Phase, 3 to 4 is

Construction Phase, 4 to 5 is commissioning and handing over phase)

i. It is imperative to develop a systematic, thought-out process when

planning for a nascent/new project so that the original objectives can

be referred to from time to time to avoid any unnecessary deviation

from the original goals.

i. Unnecessary deviation leads to:

Unnecessary delays;

Monetary loss (Due to delay in turnkey for developer, Liability

damages for contractor).

ii. Due to complexity, most developers will incorporate building

consultants to assist in the project setup process.

3.2 Project Initiation

iii. A project setup should include the following processes:

a) Setting up the work process using a Gantt Chart.

b) Develop Project Brief.

c) Write Issue Statement.

d) Define Mission & Key Objectives.

e) Specify Outputs & Timings.

f) Set Scope & Limits.

g) Clarify Roles.

h) Develop Personal Contacts.

i) Develop Project Contract.

1. SETTING UP THE PROCESS: A PRELIMINARY GUIDE FOR THE ENTIRE SETTING UP PROCESS IS DRAFTED AS A GUIDE TO PROVIDE A TEMPLATE FOR SETTING OUT THE DIRECTION FOR THE ENTIRE PROJECT.

a) Setting out the basic rules:

• Project Mission;

• Objectives;

• Schedule of works (output and timing) using Gantt Charts.

b) Identify and engage with various stakeholders (E.g Consultants, customers, government authorities, etc).

c) Ascertain communication flow between various departments and project groups.

d) Work out the resources required to complete project and assign responsibilities to various groups.

e) Select and appoint team members for various teams and departments.

f) Arrange training to ensure common approach and understanding.

g) Set up contract specifications, open tender and award suitable contracts to various contractors once design stage has been completed.

Illustration of Construction Gantt Chart Depicting Various

Overlapping Works in a Project Proper

2. Develop Project Brief

a) Once a project team has been appointed, a project brief is drafted to assign various tasks to various team members.

b) Aspects of project brief can be used as a point of reference for other future, important documents, such as operation manuals and contract specifications.

4. DEFINE VISION, MISSION AND OBJECTIVES

Vision provides the overall goal or purpose of the

project. It defines how it will look like when we get

there. It clarifies where the project is trying to get to.

Mission is what should be successfully completed in

order to attain the vision.

Objectives are the means by which mission will be

achieved.

Vision

Mission

Objectives

3. Issue Statements

• It is a clear description of what the problem is and what needs to be

improved;

• Allows project team to understand the issues at hand and provides

a guide to effective problem solving.

5. SPECIFYING REQUIRED OUTPUTS AND TIMING

i. When measurable progress and schedules are laid out for monitoring purposes, misunderstandings between the various stakeholders, such as contractors and developers, can be minimized.

ii. Project details which represents output and timing can include:

• Milestones of Gantt charts (Progress vs planned);

• Interim progress reports;

• Various interim evaluations, such as: Audit report, UC, Evaluation study, documentation (video), etc.

6. Set scope & limits: For legal and practical reasons, limits are set which must be adhered to by Project Administrators.

i. Government Regulations: In construction projects, various regulations, such as

Workplace Safety and Health Regulations, must be adhered to.

ii. Budgetary Issues: Budgets set by the management will determine the scope and

extent of works to be carried out.

iii. Territorial limits: This would be the plot of land allocated for the project. Any external

projection out of the territorial limits should be discussed with local authorities, in

order not to be on the wrong side of the law.

7. Clarify roles of Various Stakeholders

Getting suitable personnel involved in clearly defined roles ensures the necessary experience, skills and personal qualities are inherent in the stakeholders. Without these traits the project is unlikely to succeed.

Owner/Developer

Support:

Sponsor &

Facilitator

Team (Contractor Teams) : Leader &

Members

9. DEVELOP PROJECT CONTACT

The basic idea is to inculcate a feeling of a common goal towards completing the project proper, through:

Encouraging the various stakeholders to participate in various decision making roles within the project proper so that they can have ownership of the project;

Consulting various stake holders during the initial setup stage.

Generates ownership of their various roles of the stake holders.

i. Over the course of the project, it is imperative to maintain personal contacts with all stakeholders to ensure that the work is carried out smoothly and efficiently.

ii. Roles should be well-defined to ensure there are no conflict of interests and that each stakeholder knows exactly his or her own role in the project proper. E.g A project manager should not be taking the role of a sub contractor as there may be conflict of interest over the duration of the project.

8. DEVELOP PERSONAL CONTACTS

3.3 Procurement and Contract, & Contract Administration

i. After the initial project initiation and design stages have been completed, the next step is to prepare a tendering process.

ii. The Quantity Surveyor will have to draft the full list of items, which is known as the “Bills of Quantities”. These items are basically an accurate estimate of the items which will be vectored in during the cost of construction. The contractors will then have to put in the pricing.

iii. The Bills of Quantities (BQ) is incorporated within the tender documents, which is a legal document containing the various contractual rules which the awarded contractor must comply during the work duration.

iv. Contractors will put in their various bids for the completed tender document, and the contract will be awarded to the chosen external contracting party.

v. The entire tendering process is known as procurement and Contract.

vi. Procurement and Contract: To obtain goods and services within the budgeted cost in accordance with the project schedule and the contract performance requirements and/or specifications.

Sample of Bill of Quantity (BQ)

v. Contract Administration: After the tender has been awarded, the next

phase of contract administration kicks in.

During the entire duration of a project, the contract document becomes

the standard legal document which must be adhered to, since it is signed

and agreed upon by both contractor and developer/user.

Contract administration will involve monthly progress claims, inspection

of works to ensure that the standards are as prescribed in the tender

documents, any additional works carried out in terms of new works or

extra quantities (Which is subjected to variation orders), and so on.

In the event of a dispute, the case may be brought forward to an

arbitrator, whose role is to mitigate and find a solution to the dispute;

If all else fails, the dispute will have to be settled in the court of law.

vi. Contract Administrator: Often appointed by Main Contractor or Developer (Usually full time on site) to assist in administrating the contract. Roles and Responsibilities include:

• Review the contract award package upon receipt.

• Retain a file copy of contract.

• Distribute contract copy to Contract Monitor.

• Coordinate delivery of goods and services in accordance with contract.

• Verify receipt and condition of goods and services immediately.

• Contact Contract Officer for ANY changes or modifications to contract.

• Report contractor’s persistent/serious service delivery failures to Contract Officer.

• Review invoices for accuracy, approve partial or full payments, & pay promptly.

• Track payments against contract progress.

• Ensure expenditures do not exceed the total contract cost.

• Maintain an open line of communication with the Contract officer and the Contractor.

• Communicate need for contract renewal to Contract officer. Provide input in development of future solicitations.

Procurement and Contract, and Contract

Administration Process

3.4 TYPES OF INFORMATION FLOW WITHIN THE

PROJECT WORKFLOW

i. During the cause of the project, information flow between the various stakeholders can be numerous and overwhelming.

ii. Such information may be sent through emails, hard copy transmissions or even letters. These information may include the following:

• Design drawings from consultants;

• As-built drawings from contractors for submission purposes;

• Minutes of meetings;

• Emails between various parties;

• Online and hard copy submissions to various authorities.

iii. As the information can be messy and complicated, it is important to keep soft and hard copies of all the transmissions, which are typically submitted to end user or developer after project completion.

iv. Such information will be useful should there be any disputes during or after the construction process.

3.5 Problems with Information Flow in Construction Projects

i. As in most construction projects, information flow is often a problem due to complicated nature of construction.

ii. Many types of works, often taking place simultaneously, must be planned within a specific time period in a construction project.

iii. As a result, information being relayed between management and ground staff can lead to problems if they are poorly managed.

iv. Deficiencies in project information flow include:

Missing pieces or incomplete information;

Late arrival of information;

Insufficient details, particularly in as-built drawings;

Unclear information;

Poorly arranged work schedules or incorrect work processes in schedules;

Conflicting job scopes;

Poorly coordinated work processes.

v. Poor information flow may lead to the following

Delays in project completion due to work disruptions;

Poor quality of construction/workmanship primarily due to the speeding up of work to compensate for time loss;

Management has to waste too much time rectifying mistakes caused by information, causing further delays and affecting construction quality (Less time for checking work quality by engineers/management staff);

Technical defects resulting from poor coordination and lack of checking due to the need to speed up works.

3.6 The Importance of a Quality Information System i. As information system is an extremely important feature in relaying

information between various levels of site and management staffs in a project proper, it is important that a proper system is implemented to promote a smooth expedition of works.

ii. A well-implemented information system in any construction project should

be able to facilitate the following:

a) Assist project managers in: Planning; Budgeting; Resource allocation.

b) Analysis of: Variance; Performance; Forecasting.

c) Facilitate control of changes.

d) Quick review of project progress.

e) Periodic updating of progress.

iii. The Benefits include: a) Speed: Completion of project on time; b) Ease of future maintenance (In the form of operations manual). c) Economic benefits resulting from less rectification/remedial works and

early completion of works.

Process Steps with Information System

3.7 Introduction to Project Cost Management

i. Cost: Defined as a resource sacrificed or foregone to achieve a specific objective, or something given up in exchange. Costs are usually measured in monetary units, such as dollars.

ii. Managing the costs of a project is very important, as money is a valuable resource and should not be needlessly wasted due to unwanted situations, such as poor budget control or poor information flow.

iii. Project cost management: Ensures that the project is completed within an approved budget.

iv. Project Cost Management Processes includes:

a) Resource Planning: Involves determining:-

Physical Resources(people, equipment, materials etc) required:

Quantities of highlighted resources required.

b) Cost estimating: Developing an approximation or estimate of the costs of the resources needed to complete a project.

c) Cost budgeting: Allocating the overall cost estimate to individual work items to establish a baseline for measuring performance.

d) Cost control: Controlling changes to the project budget.

3.8 TOOLS AND TECHNIQUES FOR COST

ESTIMATING

By utilizing the software in Microsoft Excel and other types of statistical software, cost estimates can be derived to provide an accurate cost estimate for various projects.

i. Analogous Estimating / Top-down Estimating: Using the actual cost of a previous, similar project as the basis for estimating the cost of the current project. It is less costly but less accurate. (Rough-cost Estimate)

ii. Parametric Modeling: Using project characteristics (parameters) in a mathematical model to predict project costs.

iii. Bottom-up Estimating: Estimating the cost of individual work items, then summarizing or rolling up the individual estimates to get a project title.

iv. Computerized Tools: Use of computerized tools such as project management software and spreadsheets to assist with cost estimating.

v. Benefits from Cost Estimating

Allows for Revised Cost Estimates;

Allows for Budget Updates;

Allows for control of budgeting;

Lessons Learned can be implemented on future projects.

3.9 UTILIZING THE GANTT CHART FOR PROJECT

MANAGEMENT

i. Gantt charts are basically bar charts used to illustrate project schedules.

ii. In any project, it is a requirement to present Gantt charts for:

• Keeping track of project progress;

• To provide all stakeholders with a precise idea the scope of works to be

carried out, and the rough schedule for completion of works.

iii. Microsoft Projects is often utilized by most organizations to draft out

project Gantt Charts. For simple Gantt Charts involving minimal work,

Microsoft excel may sometimes be used as a simple substitute.

iv. How the Gantt Chart Works:

With reference to the Gantt Chart drawn using Microsoft Project:

• Red bars indicate the critical path method of the project. Critical path method, as the name implies, refers to the timing of the project which cannot be delayed: Any delays to the red coloured bars will mean the delay of the entire project proper.

• Blue bars indicate non-critical activities. These activities can be delayed for a certain duration without jeopardizing the entire project schedule.

• Black lines indicate floats. Floats are indicators of the amount of delayed time which can be afforded for blue bars without jeopardizing project schedule.

3.10 Tracking the Schedule Using Critical Path Method i. The Critical Path method is a form of algorithm used for scheduling

projects. ii. It is similar to the Gantt chart, but presents itself in a more detailed

manner. Typically used to manage a specific set of activities within the entire project proper.

iii. The Critical Path Method (CPM) helps the project management team with

the following:

a) Sets out all individual activities which makes up the entire project. b) Gives sequential order to these activities. c) Shows the dependency between activities, i.e if one activity is not

completed the other one cannot proceed. d) Shows which activities can take place simultaneously, which is crucial

to reducing overall project completion time.

ii. How it Works:

• Node No: Indicates particular milestones;

• Latest Finish Time – Earliest Start Time = Float. In this example, there is a float of 2 days.

• Activity “D” is indicated, with an elapsed time of activity indicated below. In this case the elapsed time of activity is 6 days.

iii. Example:

Observations:

a) Task D has a float of 63 mins: As long as activity D is no later than the 63 min elapsed time, Nodes 1 to 4 will not be delayed.

b) Task E has a float of 71 mins: As long as activity E is no later than the 71 min elapsed time, Nodes 1 to 6 will not be delayed.

c) Tasks D and E are not the “Critical Paths”.

d) Critical Paths from Activities A to H.

e) All critical paths must have same EST and LFT.

TUTORIAL QUESTIONS

1) Project process flow is integral to the success of any project.

i. List down the consequences or consequences of a delay in the project

(2 marks).

ii. Explain why the project vision, mission and objectives must be stated

clearly for the project team (6 marks).

iii. Explain the need for progress reports to be measured or quantified

during the progress of the project, and list down the measured

parameters which can be monitored (5 marks).

iv. Briefly explain why scopes and limits must be sets, and the type of

boundary markers which must be observed when setting these limits (7

marks).

2) Tendering is part and parcel of the procurement and contract process.

i. Define procurement and contract (2 marks).

ii. Explain how the tendering process works (6 marks).

iii. Contract administration will commence after tender is awarded. Explain, in detail, how contract administration works in tandem with the contract document (8 marks).

iv. List down any 4 responsibilities of a Contract Administrator (4 marks).

3) During the project progress, information flow is vital to the work progress.

i. List down five examples of information flow between stakeholders, and briefly explain why such information should be kept in both soft and hard copies (6 marks).

ii. Explain why problems with information flow occur during the course of the project (6 marks).

iii. List down the consequences of poor information flow within the project proper (8 marks).

4) Project Cost Management is used to keep project expenditure under control.

i. Define “Cost” with the project cost management concept (2 marks).

ii. Define project cost management, and briefly explain the importance

of budget control (2 marks)

iii. List down the processes for project cost management and briefly

explain how these processes work (8 marks).

iv. List down the tools used for cost estimation and give brief

descriptions of each tool (8 marks).