COSC 353 Exam 3

Actual performance data about the project is __________ and __________ for use on future projects (estimating and scheduling)

captured ; recorded

Forward Pass

determines early start and early finish for each activity

Backward Pass

determines late start and late finish for each activity

Government

develops and adopts statutes and regulations at the federal, state, and local level;

Slack/Float

extra time for an activity

Initial duration work period should reflect the ________________ described in the activity title

intended scope

Courts

interpret and enforce statutes and regulations and apply common law principles to resolve disputes

Examples of cases heard by a federal court include

interstate commerce, an alleged violation of a federal statute, and cases involving parties from different states

Project control is a

is a continuous cycle in which project managers identify a goal, measure results, analyze, and make adjustments as needed.

Final payment and retainage

is made to the contractor after work is complete and all contract matters have been resolved The owner will require documentation before releasing the final payment, including... - Lien waivers - As-built drawings - Punch list completion - O&M manuals - Equipment testing and commissioning - See pg. 293 in the textbook for complete list

Cost coding, using project cost codes

is the framework through which information is gathered and stored - these vary based upon the company's cost accounting system

All contracts must be consistent with a common set of ___________

legal principles

Critical path

path that connects activities with zero float

The _______ serves as the COST baseline and the _________ serves as the TIME baseline

Estimate ; Schedule

Most disputes are resolved in _______________ - federal courts have limited jurisdiction

state courts

Contract elements (continued)

• Consideration - Something of value being exchanged on both sides of transaction (usually money but it does not have to be) • Capacity - Must be of legal age (18 in most states) and of sound mind - In a corporate party, contract must be authorized by an officer or board of directors

Pareto's Law

80% of the outcomes of any project is determined by 20% of its included elements

Daily Reports

A record of the day-to-day activities and conditions on the job site. - Project name and number - Weather information - Description of work activities - Record of subcontractors on site - Record of equipment on site Note: Most CM software systems allow the user to create custom templates for project administration forms

Why Schedule?

Because scheduling is essential to the success of any project! -Anytime that people, equipment, materials, and organizations are brought together and directed toward a common goal, the schedule establishes the roadmap.

The foundation of project control consists of three components - design documents (plans/specs), a cost estimate, and a schedule. (T or F)

True

A legal contract may be written or verbal but is only formed when there is an offer, acceptance, and supported by consideration. (T or F)

True

Three Schedule types

-Bar Chart -Matrix -Network

_______ is determined from previous experience, past projects, input from trade partners.

Duration

Matrix Advantages

-Easily Understood by nontechnical people -Best when used as a coordination tool in the field

After the contract is signed, any change to the contract amount is processed as a(n):

Change Order

What is project administration?

Communicating, documenting, and keeping a permanent record of actions undertaken during the construction process. -When done with care and diligence, this processtells the whole story of the project.

Bar Charts

Graphically Represents: -Planned overall length of project -Planned duration of each major project component -Calendar start and finish dates for each project phase

Preemption

In general, federal statutes take precedence over state or local laws related to the same subject matter

Why Project Control?

It provides team members with a measure of success of past actions/decisions - an estimator can see the level of accuracy of an estimate just as the superintendent can see the actual level of productivity. -It provides an opportunity to make course corrections early if needed -The control data can be cataloged and used when bidding and scheduling future projects (Historical databases) -MONEY!!! Effective control help bring a project in on time and on or under budget (Bonus time)

What happens when there is a breach of contract?

The law seeks to make the injured party whole - Monetary damages - Equitable powers (specific performance or injunctions) * Types of damages: - Direct - Consequential - Liquidated - Punitive

Introduction to Construction Law

Think of Construction Law as "legal rules" that govern design and construction. These rules have three primary sources... -Government -Courts -Project Participants

Activities with zero float are defined as ____________________ and must be monitored closely. Any delay in the critical activities will cause a delay in the entire schedule!

"Critical" activities

The (_____________) serves as the "roadmap" and, if followed, will bring the project to a successful finish.

(Critical Path)

An effective ___________________ serves as a road map that allows the project team to make course corrections as needed

(Project control system)

Promptly addressing any variance to cost, schedule, or quality is key to an effective ______________________.

(Project control system)

Basic Control Theory

*illustrated as a repeating "Control Loop" * 1) Step one begins with the initial project plan (budget, schedule, construction costs) 2) The project plan is used to initiate field operations 3) The impact of external factors (labor strikes, bad weather, vandalism. etc) is considered 4) As work progresses, data is collected from the field operation (actuals) and compared to the initial plan (standard/target) 5) The data is analyzed (cost engineering) and recommendations are sent to management 6) Management considers the recommendations and adjusts the plan as needed

Acceptance of the Offer

- A contract is not formed unless the receiving party accepts the offer - It may be accepted verbally, in writing, or by conduct indicating acceptance

What is a lien waiver?

- A signed document that acknowledges progress payment to the subcontractor (trade partner), material supplier, equipment leasing firm, etc. for a specific amount of money - By signing a lien waiver, the trade partner gives up the right to place a lien on the project - this protects the owner by ensuring that the GC is paying the trade partners, material suppliers, equipment leasing firms, etc.

Federal Statutes and Regulations:

- Adopt and enforce laws that relate to the health, safety, or welfare of citizens or to interstate commerce - National Labor Relations Act (NLRA) - FairLaborStandardsAct(FLSA) - Occupational Safety and Health Act(OSHA) - CleanWaterAct - Americans with Disabilities Act (ADA)

Why care about project administration?

- Any successful relationship relies on effective communication - Record keeping and documentation is important to preserve a permanent record of the project - Documentation and record keeping protects all parties by keeping track of all actions on the project - Following construction, the documentation also serves the owner throughout the life of the building/facility - Many entry level positions (TAMU COSC Grads) are assigned project administration tasks!

Local Statutes and Regulations:

- Cities and counties have the power to adopt and enforce laws (often called ordinances) as authorized by their respective State * Licensing Laws (some but not all) * Building Codes (Permits and inspections) * Zoning Ordinances (controls land use) * Noise Ordinances (can impact working hours on a construction project) * Stormwater Management (watch what you put down the drain)

Types of Logic

- Sequential Logic - Concurrent Logic - Multiple Predecessor Logic - Multiple Successor Logic

State Statutes and Regulations:

- State have broad powers of regulation and lawmaking - Certain state laws are specifically designed to regulate the construction industry * Licensing Laws (some but not all states) * Hazardous Materials (asbestos testing and abatement) *Mechanics Lien Laws (Vary from state to state) * Accessibility Requirements (similar to Federal ADA) * Building Codes (adopted by the state or delegated to local level)

Who can file a mechanic's lien?

- Trade partners (electrician, plumber, HVAC contractor, etc.) - Material Suppliers - Equipment Leasing firms - Designers (ARCHs, ENGs, Land Surveyors)

The Court System in the United States is based on a strict hierarchy:

- Trial Court (disputes are initially heard here by a judge or jury) - Court of Initial Appeal (AKA "Appeals Court" or "Court of Appeals") - Court of Final Appeal (AKA the "Supreme Court")

What happens when there is an inconsistency between the actual work and the target? For example, when actual hours worked exceeded hours budgeted for the work. Determine Why!

- Worker Performance? - Reporting inconsistency - Site Conditions? - Equipment Issues? - Unrealistic standard?

Why plan?

- You cannot schedule a project without planning it first! - By analyzing each planned task/activity and its relationship to other activities, the project can be built on paper. - Planning is a powerful resource management tool - it helps determine when materials and labor need to be on the project site. - Planning and the subsequent schedule provides a base line or "target" when monitoring the project's progress. - Planning, when done correctly, sets expectations and establishes accountability.

Network Schedule Advantages

-Communicates the interrelationships among project activities -Forces a detailed discussion at the project's outset -Once developed, it helps provide very effective management of the project

Network Schedule Disadvantages

-Consumes a tremendous amount of recourses -Requires technical training and experience to develop and maintain

Planning and Scheduling -Post-Construction Phase

-In this final phase, the schedule can be used to coordinate and control when the owner begins to occupy the facility. -Most projects require testing and acceptance of equipment and training of end users. The schedule can be helpful in this regard as well. -Lastly, post construction scheduling can be part of an effective record keeping program for after action reviews so that better planning and scheduling can occur on future projects.

Liens

-Mechanic's Liens (aka, material/labor lien) are state statutes designed to apply specifically to the construction industry -Mechanic's lien laws vary from state-to-state and can be very complicated -Purpose is to permit someone who provides labor and/or materials for a project to obtain a lien on the underlying real estate for the value of the goods and/or services incorporated into the work -The mechanic's lien is valid against both the current and future owner of the property

Managing Project Finances --What are the contractors options when the payment projection reveals a shortage of cash (negative cash flow) at one or more points in the life of the project?

-Negotiating a lower rate of owner retainage -Releasing retainage earlier? -"Front -end Loading" the project with agreement from the owner? -Arranging for additional credit or longer payment terms from material suppliers? -Preparing a line of credit from the bank

What are some of the components of project administration?

-Notice to proceed -Meeting minutes -Requests for Information (RFIs) -Daily reports -Job progress photos -Monthly reports -Submittals -Application for payment -Change orders -Inspection and test results

Planning and Scheduling -Pre-Construction Phase

-Planning and Scheduling is a KEY activity during this phase -Project financing, commitments to the owner, and market projections all depend upon the scheduled start and competition date. -The initial schedule should be viewed ass an opportunity to build the project on paper and help the project team to begin making intelligent management decisions -As the project evolves, the team will continually refine the schedule to optimize the project activity durations

Activities can be divided into three categories...

-Production Activities -Procurement Activities -Administrative Activities

How is planning accomplished

-Review Historical data for similar projects. -Review "Lessons learned" from previous projects -Review the contract for milestones (notice to proceed, substantial completion, liquidated damages, bonus for finishing early, etc) -Review Plans and specifications -Define Work Tasks / Activities -Define Relationships among individuals -Define Duration of Individual Activities -Estimate Required resources

Planning and Scheduling -Construction Phase

-Schedules are essential to the successful coordination of a projects day-to-day operations (material, equipment, and labor) -As a project progresses, delays will occur! It is the CM's responsibility to effectively deal with delays -The schedule should be updated as needed (daily, weekly, monthly?) -Job Progress is closely tracked, and the schedule is often placed on the wall of the job trailer where it is clearly visible to everyone.

Bar Chart Advantages

-Simple and quick to produce -Simple to read / comprehend -Goof for executive review and public meetings

Schedule of values Example

-The GC is typically required to submit a schedule of values that identifies what each piece of the work is worth -The schedule is then used by the owner and architect as a basis when reviewing progress payment requests

Matrix Schedule

-Typically used for repetitive work, such as multi-story buildings -A good tool for communicating / controlling field activities because it can be posted in the job office and updated as work progress

Network Schedule

-Workhorse of the construction schedule - AKA Critical Path method (CPM) schedule -Requires lots of work and computer software program (Primavera or Microsoft Project) -Can take two forms (activity on narrow or activity on node) -Float or slack for each activity is also calculated

What elements are required for a legal contract?

1) An Offer (first step in forming a contract) - "I will do X for you" - An offer does not have to be in writing and it does not need to clearly state that it is in fact an offer.

The (Chronological order) Planning and Scheduling Process

1) Establish Project Objective(s) - Typically owner driven 2) Identify Project Tasks/Activities (definable work activities) 3) Determine Task/Activity Sequence (what activity must proceed and what activity must succeed?) 4) Determine Task/Activity Durations (the estimate can be very helpful here) 5) Perform Schedule Calculations (if using CPM) to determine the project's Critical Path 6) Revise and Adjust the Schedule (Could the duration be shortened to take advantage of a bonus for finishing early?) 7) Monitor and Control against the baseline or target schedule (the goal is to stay on target and finish the project on time!)

CPM - three phase process

1) Planning -What must be done? -How is it to be performed? -Sequential order in which it will be carried out? 2) Scheduling -Determines slander dates for the start and Finish of Project Components 3) Monitoring and Controlling -Comparing actual job progress to the baseline schedule

Order of Planning and Scheduling throughout the project

1) Pre Construction 2) Construction 3) Post Construction

Application of shop drawings

1) Vendor = Prepares shop drawings 2) Contractor = Reviews shop drawings 3) Designer = approves shop drawings 4) Vendor = fabricates work

Change Orders

A change on the project (money and/or time) after the contract is signed. When approved by the owner, a change order becomes part of the contract. Process Includes: - Submitting a change order form - Reviewing the form for scope and pricing - If approved, the change becomes part of the original contract Note: Change orders can be a major source of disputes on a project - it is important that everyone involved in the project have a clear understanding up front about the process and details!

Requests for Information (RFI)

A form that formalizes a request for clarification or information regarding the project. RFIs typically pass through many hands before they are answered (supplier > subcontractor > superintendent > architect) Ø A log of RFIs is kept by the contractor and design professional Ø Each RFI is sequentially numbered Ø The contractor usually requests a response by a certain date Ø RFIs are most often direct questions, however, they could be the first step in what eventually becomes a change order or dispute Ø The best RFIs start with "As we discussed" or "Per our conversation"

Multiple Predecessor Logic

Activities 1 and 2 must occur before activities 3

Multiple Successor Logic

Activities 2 and 3 can occur concurrently after activity 1 is finished

Sequential Logic

Activity 1 occurs first = Activity 2 occurs second = Activity 3 occurs third

Concurrent Logic

Activity 2 and 3 can occur at the same time

Types of Dispute Resolution (AM)

Arbitration -Parties agree to have any disputes heard by an arbitrator -The Arbitrators decision (called an "award") has the same binding effect as a judge or jury Mediation -A neutral mediator facilitates a negotiation to help the parties reach an agreement -Mediators are not typically empowered to impose a binding result or decision. -Could be included in a contract and required before moving to arbitration.

Submittals

Certain information is required to be submitted to the design professional for review. Examples include: - Shop drawings - Product literature/data - Product samples - Reports from testing agencies - O&M manuals - Product warranty information Note: Before submittals are forwarded to the design professional for review, it is the general contractor's responsibility to review each one and ensure that it meets the requirements of the plans and specifications.

Managing Project Finances

Contractors relieve income from the owner in the form of invoices - that money is then pain out to in-house labor, subcontractors, and material/equipment suppliers -Managing cash flow can be difficult because payments are made in different increments depending upon the project activity -Before construction begins, the contractor will typically prepare a payment projection - a forecast of cash needed for the company to pay labor, material, equipment, subs, and other commitments

Level of Control - How Much?

Control systems are most effective when the level of control is optimized -As the level of control increases, the cost of the control system also increases -A high level of control may be necessary on a fast-paced or highly -technical project, however, too much control may frustrate employees and/or hamper creativity and productivity. -Bottom Line = The construction professional must determine one the proper level of control that provides the feedback needed to effectively manage the project.

Every project will have at least one path through the network where all activities are critical - This is called the ___________.

Critical Path

A completed network schedule means that all work to be performed on the project has been _________ and __________

Defined ; Organized

Activity Logic Defined

Determines the sequence that activities can or will be carried out during construction - A preliminary sequence of logic that ties Predecessor and Successor activities -Logic Must Consider: 1) Safety of Personnel 2) Resources of the project 3) Preferential Relationships between activities

Bar Chart Disadvantages

Does not communicate the interrelationships among project activities

Matrix disadvantages

Does not typically consider all project activities

Application for Payment (RFP)

Each Owner will have specific progress payment requirements Many will use the form and procedure recommended by the AIA ; Form G702 -Most owners will require a detail sheet for the period and a certificate of payment, which is a summary of payments, and certification by the contractor and possibly the architect and engineer, as representative of the owner -Stored material can be included in a request for payment -The GC should carefully review the request for payment to make sure there are no errors - this could delay payment! -Request for payments must be signed by the contractor and notarized -Most owners/architects will require a schedule of values, lien waivers, off-site storage certificates, any approved changes to the contract, and a clear indication of the retainage

Hours and Minutes may be appropriate for _____________ - maintenance for plants, etc.

Fast moving Projects

Cost Engineering

Is the term used to describe the process of gathering field data and analyzing it to measure how the project is doing and what the outcome will be.

Incorrect Logic

Logic must be correct, or the network schedule will not accurately represent the way work will be executed -For example, the selection of paint color should not constrain the roof installation

Minimum Cost Scheduling

Minimum cost scheduling establishes the most efficient project duration -It involves analyzing the critical path and shortening the projects duration as long as money can be saved -Crashing an activity or multiple activities as evaluated. Crashing increases direct costs but it may be justified if indirect costs are saved or if a bonus is provided for early completion. -Bottom line = Determining the optimum duration for a project is an important step in proper planning

Retainage

Money help back by the owner until the contractor satisfactorily completes the contract (typically 5 to 10% of the amount invoiced)

When is the best time to use the scheduling and planning process as an opportunity to design and build the project on paper before actual construction begins?

Preconstruction Phase

Construction Management software

Procore

Standard/Target Versus Actuals

Project control demands a "standard" or the "Target" that defines success. For the construction project, cost, schedule, and quality are the basis of that standard. -Project control also must have a timely and effective way to measure and report actual progress. This can be complicated because information resides in a number of places (invoices, receipts, time sheets, equipment logs, etc) -The key to any reporting process is that any inconsistency is identified quickly. Good reports show variances (differences) between the standard/target and actuals.

Forecasting

Provides information on the ultimate cost and completion date of a project. Includes cost to complete, cost at completion, and projected date of completion.

Administrative Activities

Related to permits, inspections, or other government requirements

Production Activities

Related to the on-site construction of the project

Procurement Activities

Related to the purchasing and tracking of materials from the supplier to the job site

Hose BIB Submittal

Sample "Letter of Transmittal" for a submittal. -Note that this submittal satisfies the product data requirement and the product sample requirement.

Monthly Reports

Serve as an executive document intended for the owner or owner's reps. They typically include... - A narrative of the progress to date - A list of subcontractors under contract - Cash flow actuals and projected - Updated schedule with critical path - Safety report - Change order log - List of shop drawing submittals

The ___________ is typically very selective regarding the cases it will hear

Supreme Court

Progress Photographs

Taken periodically or when specific events warrant. The date and location of photos should be noted. Also useful for RFIs and punch list items. A picture is worth a thousand words!

Activity Duration Defined:

The amount of time assigned to complete a particular task/activity. -General Rule: Use only whole numbers (Days, Weeks, Months, etc.) -Hours and minutes may be appropriate for fast moving projects - maintenance for plants, etc. -duration is determined from previous experience, past projects, input from trade partners.

Preparing a Project for Construction

The construction project must be broken down into a suitable level of detail so it can be monitored/Controlled -Identify the major cost elements (20% from pareto's law) that will be closely monitored and managed. This will vary from project to project but focus on elements that will have the greatest impact on the projects costs and / or the elements with the greatest risk.

Indirect Costs

The costs (overhead) associated with the home office and general conditions. -Ex) marketing, insurance, accounting, utilities, field operations such as the job trailer, temporary fencing, and security

Direct Costs

The costs associated with the physical construction of the project such as materials, equipment, and labor

Notice to Proceed

The first formal communication under the construction contract. It is a legal document and contains two basic provisions: - it accepts the bid submitted by the contractor - it establishes a start date and completion date

Progress Evaluation and Control

The method used to measure work progress depends upon the type of work. Following are a couple of approaches... -Units completed = Floor tile example (1,500 SF of 2,000 SF installed = 75% complete) -Incremental milestone = Crane installation example -Crane received and inspected (20% complete) -Crane installed (35% complete) -Alignment completed (50% complete) -Testing completed (90% complete) -Owner accepted (100%)

Crashing

The process of accelerating an activity or multiple activities to shorten the overall duration of the project

What is Project Control

The process of documenting the projects cost, time, and quality and comparing them to the projects target baseline -It begins with identifying the owners objectives and ends when those objectives have been met -The process can also be described as a control loop (described later) that constantly repeats itself

Reporting

The process of gathering, recording, and analyzing the data needed to control the project cost, schedule, and quality. A good report should also include trends and forecasts.

Meeting Minutes

There are several types of meetings held by the contractor on the project site. Minutes should be action oriented and kept for all meetings, especially ones involving job progress (see pg. 277 in the textbook).

Shop Drawings

Translate the intent of the design documents (plans/specs) into a buildable system. They are detailed and precise so review can be time consuming! Note: Materials are not typically ordered until shop drawings are approved. Delays in approving the shop drawings are potential bottlenecks in the project schedule!

Claims and Disputes

Unresolved issues that occur during construction and remain unresolved after the job is complete -Claims can be expensive for all parties - it is in everyone's best interest to resolve issues through the change order process -The process for dispute resolution is usually outlined in the contract and could include arbitration and/or mediation. If these measures fail, litigation usually follows!

Project control in action

While a project begins with a work plan, the reality of construction is that events occur that force the plan to be altered. -When changes occur, a system must be in place to capture actual events, analyze them and make the appropriate adjustments.

CPM Calculations

Why? To answer the following questions? -What is the projects duration? -What are the start and finish dates for the project activities? -Can a project activity be delayed without impacting the overall schedule? If so, how long? How? 1) Create the network diagram from activity schedule 2) Perform forward pass (determines early start and early finish for each activity) 3) Perform backward pass (determines late start and early start for each activity) 4) Compute slack/float (extra time) for each activity 5) Determine the critical path through the network (path that connects activities with zero float)

What is a Schedule of Values?

Written list in tabular form of the value and amounts of the work, associated with appropriate monetary amounts for each activity or work element -The schedule of values is not time related, but a list of the value of the construction activities, upon which progress payments are based

Baseline

also called a "target" pr "project forecast" establishes the measuring rod or standard

A contract is

an agreement establishing rules between two or more parties, usually in written form

Performance is measured by

computing cost and schedule variances

Scheduling is the process of

listing a number of tasks or events in the sequence they will occur. -A schedule is a timetable, and it identifies the activities that must be accomplished to reach a certain goal or objective.

Trending

looking back at how the project has failed or succeeded. Trends are helpful when developing a

Project participants

make many of their own rules by entering into contracts for goods and services

The estimate and schedule establish

the cost and timing goals for the project.

The construction documents establish

the project quality

Activity on node notation

the work occurs on the nodes, which are connected by arrows

Activity on arrow notation

the work or activity is shown on the arrows which are connected by nodes

Types of Dispute Resolution (continued)

• Partnering - Relatively new technique - Attempts to proactively prevent disputes - Fosters a culture of cooperation and openness so issues are addressed before they become disputes • Litigation - Last resort! - Time consuming and expensive - Rarely results in a real "winner"