N O . 81.

1997 Editor: Peter Harlow

E-mail: [email protected]

COMMERCIAL MANAGEMENT:
AN INVESTIGATION INTO THE
ROLE OF THE COMMERCIAL
MANAGER
by David Lowe BSc MSc PhD FRICS,

Peter Fenn BSc ARKS FClArb and

Sarah Roberts MSc

Professional Services
The Chartered Institute of Building
Englemere
Kings Ride
Ascot
Berkshire
SL5 7TB
David Lowe is a lecturer and programme A study by the Royal lnstitution of Chartered Background
tutor for the BSc (Hons) in Commercial Surveyors (RICS, 1992) has identified a The interviewees believed that in the last ten
Management and Quantity Surveying in the framework for the classification of years the construction industry hod become
Departmenf of Building Engineering at knowledge and skills that a professional more competitive, with more companies
UMIST. His PhD is in the area of experiential quantity surveyor (PQS) possesses. It tendering for business. In particular, over
learning within design cost estimating, and concluded that the identification of core the lost four or five years, due to the
he is currently involved in research into the skills and knowledge was essential in recession, the amount of money available
implications of partnering on working making any diversification sustainable and for building has declined. This hod resulted
practices within the construction industry,
maintaining a competitive advantage for the in, as one person explained, ‘… 99% of the
and research into project management as a
profession. While the study did not work going to the lowest bidder’. Further,
career. Peter Fenn is also a lecturer in
specifically address the implications of the money that is generated ‘… from
Commercial Management and Quantity
commercialism on the profession, it did, tendering is pretty breakneck, whereas
Surveying in the Department of Building
Engineering at UMlST. He is currently however, comment on the need for previously we got tenders on
involved in research info dispute resolution Chartered Surveyors to be responsive to recommendation.’ Those interviewed
within the construction industry, and is joint market demand. stressed that as a result of this situation
co-ordinator of CIB TG 15 - Construction PQSs and contractors were finding it
conflict: management and dispute Structured interviews were held with five increasingly difficult to make a profit on
resolution. Sarah Roberts is a consultant PQSs and 11 individuals holding the work obtained through competitive
with Craig, Gregg and Russell occupational position of commercial manager (in some tendering. The result of this was that the QS
psychologists. cases their job title was not that of has hod to become more commercially
commercial manager). Further opinion was aware in order to ‘maximise every
obtained from two solicitors to provide an conceivable source of income.’ One
INTRODUCTION alternative perspective. The solicitors interviewee described the situation as
In 1989 a consortium of the UK’s leading specialised in construction law and one hod follows: ‘In the good old days QSs
construction companies invited selected previously been a commercial manager. measured rates and we had arguments
universities to submit proposals for a new about those rates but nobody worried
degree programme in Quantity Surveying to Based on the interviews it was hoped to: about it because the money come in
prepare graduates for the wider aspects of l define commercial management; eventually and you always got paid more
their commercial activities. The Deportment l investigate whether commercial than you spent. These days you are
of Building Engineering at UMIST was management could be taught on o degree generally spending more than you are paid,
chosen to develop the first programme, to programme and if so in what way; the focus is absolutely acute because the
be called Commercial Management and l elicit the tasks the interviewees performed value of work in progress and the cash that
Quantity Surveying (CM&QS). as port of their job and the skills needed is needed to fund it is bringing a lot of
to perform these tasks successfully. companies to their knees. I don’t think that
Ashworth (1994) has indicated that it is will change unless competition is reduced.’
essential for programme designers to Each interviewee was asked to describe
identify what students will be expected to tasks performed in his/her role as a The general consensus was that commercial
know and understand and what skills will be commercial manager or QS. They were management is a term used within the
required of them when they enter into then asked to outline incidents where they construction industry to describe those
practice. The aim of the programme, had performed the tasks effectively or individuals within construction companies
together with Ashworth’s comments, ineffectively, that is, whether the outcome who manage the finances of large, complex
highlight the need to define commercial was successful or unsuccessful. This was contracts.
management and to identify the role of the followed by describing the behaviours
commercial manager. associated with the successful or Commercial management within
unsuccessful outcomes. This produced construction companies
As port of the review and monitoring essentials of job performance which make When asked to provide a definition of
processes associated with the programme the difference between success and failure commercial management all interviewees
development, a detailed investigation of the in a job. provided on answer that centred on the
nature and context of commercial following: ‘commercial management is
management was carried out by on The supervisors of the interviewees were looking after the profits of the company.
occupational psychologist trained in also interviewed to obtain confirmatory That is done by keeping costs to a minimum
interview and job analysis techniques. data. and maximising income.’

METHODOLOGY RESULTS When asked to describe the actual skills

A review of the literature did not unearth a The results were analysed using content and tasks required of a commercial
definitive statement of what was meant by analysis. For job analysis this involved manager, in order to fulfil the above, all
commercial management nor a description organising the incidents into various those interviewed thought that the following
of the tasks and skills associated with the categories that were then used to compile a were important: analytical skills, numerical
role of a commercial manager. Scott (1974) list of tasks, skills and competencies skills, logical thinking and the technical skills
and Gilbreath (1983) addressed some of associated with the role of commercial associated with quantity surveying.
the issue associated with commercial manager. These lists are given in Appendix
management, while Cottrell (1979) A. The information contained in the One of the primary functions of a
identified those skills needed by the building interviewees’ responses to the questions commercial manager is the management of
quantity surveyor but, again, no definition ‘What is commercial management? and ‘cash flow’. This has been described as
was found. An investigation by Cornick and ‘Should graduates be taught commercial ‘good housekeeping’ or ‘applying the same
Osbon (1994), while establishing the role of management? were analysed by identifying rules to the management of the company’s
the contractor’s quantity surveyor during the the key themes that arose in the answers money as you would use when managing
construction process, did not address the supplied. The data were then interpreted in your own money’. An analogy used to
specific issue of commercial management. the context of the research aims. illustrate the latter definition, described by
several interviewees, was not paying your

2
mortgage until your salary has been paid commercial manager could not always stick problem solving. However, one interviewee
into your bank account. Managing cash to hard and fast contractual rules. They believed that personality factors are often a
flow is complicated and involves many need to know when to be flexible. Several big influence in these situations, ‘… people
aspects, some of which are directly related interviewees even went as far as to call it either like you or they don't.
to a project’s financial position. This skulduggery.
involves setting up payment clauses within l The ability to communicate: Com-
contracts so that sub-contractors are paid l The ability to analyse risks: Managing munication skills include written and oral
after payments have been received from the cash flow was believed to begin at the communication and involve making sure that
client. It also involves the analysis of sub tender enquiry stage. All those interviewed all relevant individuals are informed of
contractor tenders to ascertain which considered that those individuals who were matters that concern them. It is also about
provides the cheapest quality service. This commercially aware would see the being proactive and about searching for
incorporates analysis of weekly or monthly importance of risk assessment at this stage of information. As one interviewee explained,
cash reports provided by the QS on site. a project. ‘A good commercial manager ‘… if you don’t have information how ore
The commercial manager attempts to will assess the risks associated with a tender you going to make a valued assessment of
balance the payments coming into the and decide whether they were acceptable or how much it’s going to cost?’ All
company or project with those going out. unpriceable’. One interviewee described interviewees stressed the importance of
This can involve such matters as checking the process as follows: ‘To determine the written communication to being
sub-contractors’ claims and forecasting, a risks I go through the tender documents and commercially aware. This was in particular
tool used to predict future financial look at the terms of the contract… are the reference to variations and disputes.
transactions and as a result the final costs mainly principal ones? I look at the Further, all interviewees considered that a
financial outcome of a project. This enables nature of the contract. The more complex commercial manager should follow all
increases in costs or variations to be the building the more areas of potential procedures ‘to the book’, so that mistakes or
accounted for and the opportunity to failures there are and the more management misinterpretations were not made that might
balance out the increases in cost by a things I have to do to make sure it does not result in loss of money at a later stage.
reduction in costs elsewhere. fail.’ The assessment of risk does not only
occur at the tender stage of the project but In order to perform all of these skills well, the
Commercial management is also considered at all subsequent stages. Almost all those interviewees stressed that the ability to work
to incorporate other aspects that are less interviewed believed that risk analysis was in a team was important. This included
directly involved with the finances but which on important part of the commercial knowing when to delegate.
are related to managing the cash flow of a manager’s role. Three stages of the risk
site or company. Examples of these are: assessment process were described: Private Quantity Surveyors’ views of
l being proactive about assessing commercial management
l The ability to take a broad perspective: situations and discovering possible The role of the QS in private practice varies
This was described as the ability to be able risks. The risk is then less likely to turn slightly from that of the commercial manager
to see the effect of one action on other parts into a problem; employed within o construction company.
of the site or company. For example, ‘… l determining the cost of the risk, then The PQSs interviewed suggested that if a QS
recognising that if a dispute with a sub- assessing whether this cost/risk is was to be successful and progress to o
contractor were to result in litigation, even if acceptable; managerial position within private practice
you win you still lose, it is not good for the if not, then they needed to be commercially aware.
image of the company… a CM needs to be l discovering ways to reduce the risk and Those who were considered to be ‘bean
able to recognise that and do everything thus the cost associated with the risk. counters’ would remain in a technical role
he/she can to resolve the dispute before it and not progress within the practice. The
gets that far’. Another interviewee gave the l The ability to convert work required on PQSs agreed that taking o broad
following example, ‘Construction generates a project into packages: A commercial perspective, thinking laterally, having good
a cash flow which is a big plus for a PLC. As manager, it was thought, needs to be able to negotiating and communication skills; being
a CM you need to understand the assess the best way of subdividing the works proactive in assessing and finding solutions
importance of that money for the rest of the into packages. This involves assessing to risks and problems were all skills and
company’. which solution provides the best service at competencies associated with commercial
the lowest price. This task relates to both management. The ability to manage cash
l The ability to think laterally: This was having a broad perspective and managing flow was not considered as important for
described as problem solving by assessing the cash flow. PQSs because their role did not require them
the problem by different or unorthodox to balance accounts or forecast figures, to
methods, whilst considering the whole Two skills that were believed to be important the same extent as a commercial manager.
picture. One interviewee provided on in relation to all of those matters mentioned However, it was considered important to be
example of this ‘… we couldn’t reach an above were those of negotiation and knowledgeable about such things as: the
agreement with a client about the payment communication. effect delays in the project would have on
of a project. They were not prepared to pay the client’s interest charges and whether
us what we had paid out… After much l The ability to negotiate: A continuous bank rates were going up or down. The
searching for a solution we came to the aspect of the commercial managers’ role is supervisors of PQSs stressed that at a higher
arrangement that the client would pay us the negotiation. This can include: the level within a private practice (managerial
amount of money they wanted to pay us six negotiation of payments with clients; or partner level) it was relevant for a QS to
weeks before we finished the job, as they negotiating disputes with sub-contractors and be more concerned about profit margins
were not earning interest on it. We were resolving the implications of design changes and cash flow, and in particular about the
then able to earn interest on it and by the with architects. All those interviewed effect certain actions could have on the
time we finished the job it hod increased to suggested that in order to successfully practice as a whole. Again, this relates to
the sum we originally asked for, Everybody manage the finances of the site or company the ability to take a broad perspective. This
was happy and the client then gave us more on individual needs to be able to negotiate. lost point was also considered important for
work after that’. Lateral thinking was often This was described as ‘knowing the rules of those employed in a similar position within
associated with being flexible. Many of negotiation’, when to put people at ease the solicitor’s practice.
those interviewed thought that a good and when not to and it often incorporates

3
There were three issues associated with definition for commercial management and that the agenda should be set by
commercial management highlighted by meant that the provision of commercial students.
PQSs that were not mentioned by management within the curriculum was
commercial managers in a contracting initially dealt with on an ad-hoc basis. Despite the fact that it was thought that these
organisation. These are: However, since the investigation formulated skills should be taught at university, it was
l an understanding of development a definition of commercial management this emphasised that it is more important for
appraisal; posed further questions for the programme students to learn the technical skills of the
l knowledge and understanding of team. Could the skills and competencies QS. ‘… When you hire a graduate you
market forces; attributed to the commercial manager be want him/her to be the back room boy/girl
l the ability to choose an appropriate acquired through the programme and who can turn out bills of quantities,
procurement strategy. should it be included within the syllabus or estimates, etc. Often graduates believe they
as a wider curriculum issue? are going to be a manage… that is
l An understanding of development something they can learn on the job… First
appraisal: a QS must manage all aspects Can and should we teach and foremost they ought to learn how to be
of the client’s financial outputs, which means commercial management? a quantity surveyor, secondly they ought to
it is important to have an understanding of The general consensus of those interviewed learn how to be a manager.’ This point
development appraisal. This was described was that the skills associated with highlights the views of Barrie (1995), who
as ‘knowing how the developer is structuring commercial manager are acquired through reports the difficulty experienced by leading
their appraisal for doing the development, ‘experience on the job’. Some even QSs in finding graduates with basic skills.
how the various costs fit together’. expressed the opinion that they would prefer
Incorporated within this is a knowledge of to hire a day release student rather than a Implications for the delivery of
rents and yields. It was also considered full-time graduate as they had gained Commercial Management themes
important to be able to determine what ‘experience on the job’. However, they did within the curriculum
aspects of the building process would be acknowledge that after a few years of The skills of the commercial manager as
critical far controlling costs. One of these experience the graduate often performs described above can be divided into two
aspects was considered to be time: if a better. main areas, d e c i s i o n m a k i n g a n d
contract over-runs the client loses possible interpersonal. However, in addressing the
earning potential. In short, an understanding This view is supported by Male & Stock most appropriate methods of fostering these
of development appraisal is concerned with (1991) who argue that within construction abilities and skills the programme team was
understanding a client’s financial and there is a heavy reliance placed upon required to consider implications that fell
design position. experience, a knowledge and high-order between their initial remit, that is, the
source of advantage. They also comment provision of a broad rigorous education
l Knowledge and understanding of the that there is a high reliance on individuals at (university) and vocational training [the
market: ‘One of the aims of a QS is to get all levels within construction organisations construction organisations).
value for money out of the building, to make and management development is held to be
sure, in conjunction with the rest of the a key source of competitive advantage. l Decision making skills
design team, that the building is attractive to Langford & Newcombe (1991) suggest that Ashworth (1994) acknowledges that there
the market. Therefore, being aware of the management development is a process that has been a discernible shift within the
market is important so that you can feed into upgrades a company’s managerial surveying profession from a reliance upon
the design process.’ resources to meet its present and future memory recall of available knowledge
needs, which can be achieved through a towards problem solving. He asserts that the
l The ability to choose the right variety of means. current emphasis is towards understanding,
procurement strategy: this was considered the development of transferable skills and
to be important in relation to the client’s Despite this view, those interviewed competent application. He also states that
development appraisal. A QS should be suggested that if it was possible to give the development of the trained mind
aware of the advantages and students a grounding in the skills mentioned, includes; critical thinking and reasoning
disadvantages associated with different then universities should seek to do so. skills; the ability to think conceptually and
procurement strategies and have the ability intellectual perspective and independence of
to advise the client on the best strategy, All interviewees expressed the view that a thought. The abilities collated under this
having considered the client’s development theoretical approach would not suffice. heading include adopting a broad
appraisal, that is, does the client consider They gave the opinion that experience of perspective, lateral thinking/problem solving
time, costs or quality as the key criterion? actual situations was needed. Simulation and flexibility/openness.
was suggested as a way to do this by l Broad perspective: A working
COMMERCIAL MANAGEMENT allowing students to experience a situation definition of this trait has been
WITHIN THE PROGRAMME where they could analyse risks, problem provided by Handy (1989) who refers
CURRICULUM solve, search for information and make a to a process of re-framing, which he
As the BSc in Commercial Management and profit on a project, etc. One interviewee defines as “… the ability to see things,
Quantity Surveying developed, the suggested computer simulation, while problems, situations or people in other
programme team designed a programme another suggested group exercises with ways, to look at them sideways, or
based around: a rigorous university students within the group taking on different upside-down; to put them in another
education; a thick sandwich course roles. The student with the role of perspective or another context; to think
involving Supervised Work Experience commercial manager would then try to find of them as opportunities not problems,
(SWE) and collaboration between the out the relevant information needed to make as hiccups rather than disasters”. He
university and the sponsoring companies the site run smoothly and make a profit. considers reframing to be important as
providing the SWE. To date this has it unlocks problems. Likewise, an
appeared to work well; feedback into Some of those interviewed suggested the awareness of the implications of an
programme development was provided by a use of visiting speakers from industry to give individual’s comparative action
series of committees and satisfaction students a flavour of what to expect. One decisions is central to the concept of
amongst the sponsoring contractors and interviewee suggested that students should decision support and decision making
graduates is high. The lack of an agreed be encouraged to question guest speakers theory.

4
 l Lateral thinking/problem solving: De The RICS (1992) suggest that the core skills centred approach occurs from interaction
Bono (1985) considers lateral thinking of the QS should be taken to mean Analysis, between group members. Further, there is
to be a neutral process, an ability to Appraisal/Evaluation, Communication, usually an emphasis on democratic decision
change perception and to keep on Documentation, Management, Quantification making and the consideration of different
changing perception, pattern-switching and Synthesis. points of view within the group, whilst the
within a patterning system. He development of the group itself is often a
suggests specific and formal methods Are these skills exclusive to the commercial focus of learning.
for generating new ideas or a new manager or QS? Eraut (1994) considers
approach (unorthodox problem solving) deliberate processes such as planning, Role-play, Simulation and Games:
- these included stepping stones - where problem solving, analysing, evaluating and Entwistle (1992) defines simulations as
an idea is employed for its movement decision making to be the essence of activities that are designed to mimic real-
value instead of just its judgement professional practice. He proposes that world experiences and provide, for
value, escape - where current these processes cannot be accomplished by example, controlled opportunities for
methods/processes are assessed in using procedural knowledge alone nor by exploring actions and their consequences in
terms of their appropriateness and adhering to a practice manual. They teaching problem-solving. Additionally, the
random stimulation - where we open require, he suggests, a unique combination opportunity to engage in role play allows
ourselves to influences other than those of: students to take on the identity of someone
we directly sought. l prepositional knowledge; else thereby gaining insight into the
l situationol knowledge; and motivation and feelings of that person,
l Flexibility/Openness: Lateral thinking l professional judgement. something that no lecture or discussion could
involves a willingness to search for ever provide. Lansley (1985) put forward
better concepts. It is to do with change, Within many professions, therefore, there is the case for a games-based simulation
especially when change necessitates an emphasis on the need for interpersonal approach within building education.
escaping from working patterns that skills, the ability to work in teams and Ndekugri and Lansley (1994) discuss the
have been satisfactory in the past. cognitive skills such as problem-solving. The benefits and advantages of simulation within
Therefore, it requires the individual to incorporation of these skills and abilities construction management: those that seem
be open to changes in the working within the CM&QS programme would pertinent to the delivery of commercialism
practices that may result. However, benefit from a review of the development within the curriculum include:
most people dislike the uncertainty and delivery of parallel professionally l a decision support system;
generated by change and as Knowles accredited degree programmes. Eraut l a vehicle for teaching theoretical concepts
(1970) acknowledges adults acquire a considers that all of the above can be in construction project management;
large number of fixed habits and developed and demonstrated outside the l a tool for training and management and
patterns of thought, and tend, therefore, working environment and that this is organisational development;
to be less open minded. sometimes a better solution. l an instrument for team building.

Decision making skills, therefore, have a l Methods of implementation Games, on the other hand, are similar to
direct impact on the commercial manager’s Traditionally universities have usually dealt simulations but introduce a competitive
ability to manage cashflow and to assess with knowledge rather than skills and element where there are rules, points are
risk by being proactive in appraising abilities. However, the implication of the awarded and there are winners and losers,
situations, determining the cost of risk and in survey is that a theoretical approach is not
discovering ways o f r e d u c i n g a n appropriate nor sufficiently helpful in Lovell (1980) is of the opinion that bath
organisation’s exposure to it. allowing students to acquire the necessary games and simulations enable students to
skills and abilities required of the learn by experiencing at first hand at least
l Interpersonal skills commercial manager. some of the elements of realistic problems.
Interpersonal skills are important to the He considers them to be ideal for illustrating
commercial manager. In the case of It is recognised that the formal lecture is not how systems work and drawing attention to
learning to work in teams within perhaps the most appropriate method of cause and effect. However, he points out
organisations, professional education was student learning. While there has generally that role-play, simulation and games need to
found to be lacking. (Eraut, 1994) been a move towards the use of tutorials, be followed by periods of discussion,
However, should the development of these seminars and student centred or project evaluation and rethinking in detail of the
skills be restricted to an individual’s based learning, it would appear that more way the exercise was approached.
immediate working environment? It has been attention is required in focusing on student Therefore, if debriefing is not incorporated
shown that people who have learnt how to learning than teaching if a student’s and students do not attempt to integrate their
work together on a course can continue to capability in commercial management is to experiences with their previous knowledge
learn from each other and provide mutual be developed. The following are ways in and understanding, then these exercises are
support when they return to work, (Eraut, which this may be achieved: a waste of time. Moreover, the closer to
1994) reality that a role play, simulation or game
Team work and Outdoor Management becomes the more successful it is likely to
l Core skills of the QS Development Courses (OMDCs): Betts and be.
Liow (1993) suggest that working in groups
The core skills of the QS as identified by on projects is more related to the real It would appear, therefore, that simulations
Ashworth (1994) ore: professional world. It is likely to be more do stimulate and develop both thinking and
l communication and the use of language; useful in employment and assists in the inter-personal skills but only when the
l numeracy and an understanding and development of communication skills. processes are explicitly discussed within the
appreciation of data; Further, they suggest that at an interpersonal group.
l problem solving; level, active participation with feedback
l teamwork and interpersonal skills; prepares students to contribute ideas and AROUSAL (A Real Organisational Unit
l information technology; develop leadership qualities appropriate to Simulated as life): A development of
l world of work. their chosen profession. Also, Boud (1989) simulations and games is the use of
suggests that much learning within a group computer simulations such as AROUSAL

5
developed by Lansley (1985) which l assessing the work experience in ways assessment systems clearly reward a surface
recreates the decision making environment that are comparable between students approach. However it would appear that it
in which construction companies are and also describe the skills developed. is possible to change students’ approaches
managed. The areas of decision making to learning as they seem capable of
modelled by the system include: Ways of overcoming these problems adopting either a surface or deep approach
l corporate strategy regarding type, size include: but it is easier to do this early in a course
and location of work to focus on; l the use of learning contracts, which than towards the end. It is necessary to
l bidding; describe in detail what the student has increase students’ intrinsic motivation
l cashflow management; agreed to do (Entwistle, 1992); without increasing extrinsic motivation and
l recruitment and termination; l the inclusion of the work based mentor in that the appropriate focus of attention in
l staffing of projects; the negotiation of the learning contract improving the quality of student learning is
l tempo of working on contracts (normal or enhances involvement with the student course design and process rather than
crashed]; (Entwistle, 1992); teaching and content.”
l salary administration etc. l recognising that the need for formal
assessment is essential to give work In summary, the implication of the
A further sub module focuses on the decision experience its appropriate status within a investigation was that a theoretical
making processes involved in the degree scheme (Entwistle, 1992); approach would not be the most
management of sub-contracted work and l the use of Personal and Academic appropriate method of helping students
sub-contractors. The application of Development Plans (PADPs). acquire the skills and abilities attributed to
computer simulations such as AROUSAL the commercial manager. It was evident,
seems to be a way in which realism and a Problems in implementing changes in therefore, that despite a general move
commercial attitude can be replicated within the method of delivery of university within higher education towards the use of
a university setting. based degree programmes tutorials, seminars and student centred or
Betts and Liow (1993) discuss the problems project based learning, to develop a
Supervised work experience: The of replacing a traditional didactic approach student’s capability in commercial
incorporation of supervised work experience to university courses with more active management more emphasis was required
in the form of ‘thick’ and ‘thin’ placements learning. They comment on the need to get on student learning rather than in providing
has been central to the philosophy of the conservative staff and students to change, teaching.
majority of QS degree programmes. The particularly as both groups perceive project
CM&QS programme incorporates the work to be a high risk activity compared to CONCLUSIONS
requirement for students to undertake 46 traditional teaching methods. In addition, Commercial management within the
weeks of supervised work experience. the assessment of project work is construction industry was defined as
Ashworth and Saxton (1992) suggest that problematic. Attempts have been made to ‘looking after the profits of the company...
placements should develop maturity; enable introduce courses that are designed to by keeping costs to a minimum and
the exploration of the theory-practice link; analyse the operation and needs of the maximising income.’ The study has shown
encourage the development of critical but construction industry by introducing o series that the following skills and competencies
pragmatic thinking; and facilitate systems of events through which students develop the are inherent to commercial management:
thinking. However, for this to take place ability to deal with uncertainty, take control logical thinking; analytical ability; numerical
placements should be treated as providing of their learning and develop an ability to skills; the technical skills and knowledge
genuine educational experiences. be ‘reflective in practice’ (Boyd and Wild, associated with quantity surveying. In
1993). However, this innovative course is addition to these skills a ‘good’ commercial
Further, they raise the following questions: at Masters level and is designed for entrants manager was thought to be competent in:
l how can such placements be managed with prior experience of the industry. managing the company or project cash
so as to give maximum benefit to the flow; taking a broad perspective and
learner? The introduction of a more experiential thinking laterally; analysing risks, which
l what is the role of the supervisor at the problem based learning environment has incorporates being proactive, assessing the
workplace? implications for academic staff. As potential cost of a risk and solving any
l how can students be encouraged to Packham et al. (1989) point out, staff are no problems associated with it; negotiating;
reflect on the situation and to develop longer seen as the sole controller of communicating and team working. In
learning opportunities themselves? learning; neither are they the sole source of addition to this PQSs believed that an
l what is the role of the visiting tutor? knowledge. The roles of staff ore: understanding of development appraisal,
understanding market forces and choosing
They suggest that typically students are l to provide support to the learner; the right procurement strategy were
unprepared to make best use of the l to provide access ta resources for important for a QS in private practice. There
placement as a learning opportunity. learning; was, for the PQS, less emphasis on cash
Further, in the past there has been much l to provide critical feedback to learners; management unless the individual was in a
criticism of work experience, derived from l to assist in student assessment. management position within the practice.
the difficulty in ensuring that all students
obtain valuable experience that relates to Boud (1989) suggests that there are major Finally, the investigation led to the
the academic or professional content of the implications for the training of experiential consideration of how these skills and
course. (Entwistle, 1992) educators and the design of courses. A abilities could be acquired through a course
CNNA funded research project into programme. Methods that focused on
Entwistle suggests that the following are the improving student learning (Gibbs, 1992) student learning, in particular experiential
three most difficult problems in providing concluded that: learning, were incorporated into the
effective work experience: … while different courses revealed different programme. These included an outdoor
l ensuring an appropriate match between patterns of learning and individual management development course, role-play
the academic content of the programme differences are extremely wide a surface and simulation, and supervised work
and placement activities; approach is common, that assessment experience. However, to maximise the
l ensuring that mentors are able to provide dominates students’ thinking to a student’s ability to learn from experience, an
the necessary support; considerable extent and that some introduction to personal and academic

6
development planning and other methods of Course BBC Books, London APPENDIX A
improving learning ‘by doing’ were
provided. Entwistle, N (1992) The Impact of Teaching TASKS
on Learning Outcomes in Higher Education:
ACKNOWLEDGEMENTS A literature Review CVCP Paperwork
The authors are pleased and grateful to Two to three hours a day tends to be spent
acknowledge the financial contribution from Eraut, M (1994) Developing Professional dealing with paperwork. This consists of:
Enterprise in Higher Education (EHE), which Knowledge and Competence The Falmer l reading all in coming mail. This is
funded this research project. The support of Press, London thought ta be necessary as it provides the
the consortium of contractors who sponsor opportunity for the commercial managers
the BSc in Commercial Management and Gibbs, G (1992) Improving the Quality of to be kept up to dote with all sites. This
Quantity Surveying is, once again, Student Learning Technical and Educational broad perspective is thought to be
recognised. The data for this research were Services, Bristol important to make sure any problems are
provided by quantity surveyors and identified as early as possible. Where
commercial managers working for the Gilbreath, R. D. (1983), Managing necessary, any actions derived from the
following organisations: Contracts: Operational Controls for mail are then delegated to other members
Commercial Risks. New York: Wiley. of the team;
Bovis Construction, Bucknall Austin PLC, l writing letters and memos. A large
Cameron Middleton and tees, Costain, Handy, C (1989) The Age of Unreason amount of these are to subcontractors to
Gardner Theobold Management Services, Arrow Books, London keep them informed of any variations, or
Laing North West, Masons Solicitors and to respond to any claims;
Privy Council Agents and Sir Alfred Knowles, M S (1970) The Modern Practice l preparing reports. This usually involves
McAlpine of Adult Education: from Pedagogy to collating financial and progress reports
Androgogy Cambridge Book Company from sites and presenting them to clients
The authors are grateful for the time and and senior members of the management
expertise which was freely given. Langford, D and Newcombe R (1991) team.
‘Management Development in Construction’
in Competitive Advantage in Construction Meetings
REFERENCES edited by S Male & R Stocks, Butterworth Meetings include:
Ashworth, A (1994) Education and Training Heinmann, London l formal and informal meetings with site
of Quantity Surveyors Construction Papers staff involving discussions about progress,
No. 37 The Chartered Institute of Building, Lansley, P (1985) ‘Putting organisational costs and potential problems. They often
Ascot research into practice’ Construction involve walking around the site to check
Management and Economics, Vol.3, pp1-14 on progress, assessing risks, identifying
Ashworth, P and Saxton, J (1992) problems and finding solutions;
Managing Work Experience Routledge, Lovell, B R (1980) Adult Learning Croom l meetings with clients to discuss progress
London Helm, London and to negotiate payments;
l formal meetings with senior management
Barrie, G. (1995), ‘The Top QSs Struggle Male, S and Stocks, R (1991) ‘Competitive to discuss financial reports;
to find Graduates’. Building. 29, 12. advantage in construction: a synthesis’ in l negotiating with sub-contractors and
Competitive Advantage in Construction solicitors in an attempt to resolve disputes.
Betts, M and Liow, S R (1993) ‘The edited by S Male &, R Stocks, Butterworth
relationship between teaching methods and Heinmann, London Managing cash flow.
educational objectives in building education’ This is predominantly about making sure that
Construction Management and Economics, Ndekugri, I and Lansley, P (1992) ‘The Role the site is making a profit. It has been
Vol. 11 pp 131 - 141 of simulation in construction management’ described as ‘good housekeeping’. It
Building Research and Information, Vol. 20, involves making sure that the sums of cash
Boud, D (1989) ‘Some Competing Traditions No. 2 coming in are higher than those going out.
in Experiential Learning’ in Making Sense of This incorporates a number of aspects:
Experiential Learning (edited by S Warner Packham, R, Roberts, R and Bawden, R l agreement of sub-contractors’ terms of
Weil and I McGill) The Society for Research (1989) ‘Our Faculty Goes Experiential’ in payment so that the sub-contractors are
into Higher Education &, Open University Making Sense of Experiential learning paid after payments hove been received
Press, Buckingham [edited by S Warner Weill and McGill) The from clients. It also involves the analysis
Society for Research into Higher Education of the site evaluations to determine what
Boyd, D and Wild, A (1993) ‘Innovation &, Open University Press, Buckingham the payments should be. Having the ability
and Learning in Construction Management’ to spot excessive claims or work not done
Proceedings of 9th ARCOM Conference, RICS (1992) The core skills and knowledge is important in relation to this area.
September 1993, Ed. R Eastham &, RM base of the quantity surveyor The Royal l assessing tenders for possible risks and
Skitmore, ISBN 0951906070 Institution of Chartered Surveyors, London attempting to minimise those risks so that
any financial cost is minimised.
Cornick, T and Osbon, K (1994) ‘A study of Scott, P. (1974), The Commercial l forecasting cashflow. This involves the
the contractor’s quantity surveying practice Management of Engineering Projects. production of weekly or monthly turnover
during the construction process’ Construction Gower Press. and profit forecasts, taking into account
Management And Economics, Vol. 12 pp any variations and anticipated increased
107-111 costs.
l negotiating payments with clients. In
Cottrell, G.P. (1979), The Builder’s Quantity some situations costs may increase. It is
Surveyor The Institute of Building. 1-7. the responsibility of the commercial
manager to obtain any money due from
De Bono, E (1985) De Bono’s Thinking the client where necessary. The

7
 commercial manager also needs to agree QS technical skills Negotiation
final accounts in relation to both the client Essentially the basis skills of a QS, which This skill incorporates persuasiveness and is
and the sub-contractor. include compiling contract documentation, a combination of both interpersonal skills
measurement and evaluation. and problem solving ability. The manager
Procurement should influence others in o way that results
This involves analysing information in the logical Thinking in acceptance and agreement. It is
tender. The works are split into packages. It was felt by all of those interviewed that to considered important to know the rules of
A scope of the works and a list of possible be a good commercial manager an negotiation, when to give away small points
sub-contractors are drawn up for each individual needs to be a logical thinker, as in order to win bigger ones. It is having the
package. The commercial manager will many of the other competencies will interact ability to know when and how to put people
research into the sub-contractor’s with this competency. (For example, to be at ease and also when not to. This can also
background to make sure that they are able to analyse risk then one needs to be involve knowing when to be flexible and
financially reliable and provide a quality able to think through all possible options move away from procedures when
service. The sub-contractors are then sent an and outcomes in a logically systematic necessary. An example given is: when
‘out to tender’ document. It is felt that a manner). The following skills are those that interviewing sub-contractors one needs to
degree of commercial awareness is needed a commercial manager needs to be able to make them feel at ease, so it is best not to
to decide how to split the packages up. perform the job well. They are in no specific have a desk in-between you and use very
order except that those that are considered open gestures. This way they will be more
Analysing Tenders more important to commercial management likely to open up.
This incorporates: come towards the top of the list.
l assessing the risk involved in tenders. Oral and Written
This involves spotting potential problems, Cash Management Communication skills
identifying the problem and managing the This is the ability to analyse and interpret This was considered important as many of
situation such that the problem does not numerical information and then forecast the problems that occur on site are due to
come up in the end product. An analysis future cash flow. It has been termed ‘good poor communication. Commercial managers
is made as to whether the risk outweighs housekeeping’. It is about applying need to document important decisions on
the profit; common sense to manage the cash flow. site to avoid the risk of misunderstandings
l establishing whether a client is financially Examples given are not paying the sub- and associated additional cost. A record,
sound; contractors before the client has paid you. It therefore, is kept of everything for future
l analysing the content of sub-contractor is the ability to save and make money disputes.
tenders to establish what aspects are outside of a framework.
included in the final figure, then Organisational Skills
establishing which will provide the Broad perspective This is the ability to organise oneself and
cheapest quality service. Commercial managers should be able to other people. It involves co-ordinating
show a broad based view of events, issues different tasks and individuals
Dealing with Disputes and activities and perceptions of the long
This involves investigating claims from sub term impact and wider implications. Ability to be proactive
contractors, usually in the form of collating Examples given of this brood perspective This skill is thought to be related to risk
information, usually from company records are: analysis and having a broad perspective. A
and analysing the information to determine l understanding the importance of the cash good commercial manager needs to be
who is right. Decisions then need to be flow that construction generates to the rest proactive about finding out information in
mode about how to progress. For example, of the company; order to acquire a broad perspective and to
to back down and pay the subcontractor, to l recognising that it is better to try to solve be informed about any possible risks or
try to negotiate a payment or to take it to a sub-contractor dispute through problems.
arbitration / litigation if no solution con be negotiation rather than litigation as there
found. are implications for the company in terms Team Working
of cost and reputation. This is the ability to work with o group of
COMPETENCIES people. This can involve delegating tasks to
Risk Assessment different members of the team.
It was assumed that a good QS will hove the This is thought to be heavily related to the
following four skills, which are therefore commercial side of the commercial
inherent in a commercial manager. These manager’s role and complements the broad
four skills are considered prerequisites to the perspective that a manager should have and
remaining skills listed. their knowledge of cash management. A
commercial manager should be able to
Analytical skills identify constantly any possible risks inherent
This is the ability to analyse information in tenders, sub-contractors and clients and
presented in numerical and written format. find ways to minimise that risk.

Numerical skills (Interpretation rather Examples given were, if there is an intricate

than calculation). brickwork design required on a job it, then
This is the ability to interpret the numbers in the commercial manager should be able to
cash reports, tenders and the like. If o assess that even though it will cost more
commercial manager is weak in numerical money a specialist should be brought in to
interpretation then the ability to interpret do the brickwork because it may save
information in tenders and evaluations and money in the long run.
the ability to forecast future cash flow will be
inadequate.