Cost Engineering Journal - February 2005

February 2005
2005
The AACE International Journal of

Cost Estimation, Cost/Schedule Control, and Project Management
Promoting the Planning and

Management of
Cost and Schedules
Cost Engineering Focus: IN

IN THIS
THIS ISSUE
ISSUE
Planning and • Technical Article -
The Effect of Early
Scheduling Freezing of Scope on
Project Schedule
• Technical Article -
The Case of US
Projects in Europe -
Knowlton Hall
Columbus, OH Guidelines to Mitigate
Schedule Delay, from
the Owner’s Viewpoint
• Technical Article -
Construction Baseline
Schedule Review and
Submittal Timeframe
• Special Series -
Surviving the Perfect
Storm
Preheater Tower Pierce Transit Tacoma Dome Station Development • Executive Article -
Florence, CO Tacoma, WA Avoiding Successful
Lawsuits by Non-
Performing Employees
• Special Feature -
Primavera Launches
New Synchronization
Software for
Contractors and
Subcontractors
Puenta de la Unidad (Bridge of Unity) Wacker Drive Replacement

Monterey, Mexico Chicago, IL
The Association for the Advancement of

Cost Engineering International
Visit our website at www.aacei.org
The AACE International Journal of
AACE International
Cost Estimation, Cost/Schedule Control, and Project Management
Board of Directors
President
Clive D. Francis, CCC ESTABLISHED 1958
Black & Veatch, MI
734-622-8543/fax: 734-622-8700
e-mail: [email protected]
Depar tments
President-Elect
Philip D. Larson, CCE PSP President’s Message ................................3 Professional Services Directory ..............37
WinEstimator, WA In Our Estimation ..................................5 AACE International Bulletin ..............38
253-395-3631/fax: 253-395-3634
Special Feature ....................................11 Article Reprints and Permissions ..........41
Special Focus ........................................19 Calendar of Events ..............................44
Past President
Ozzie F. Belcher
Executive Article ..................................20
Belstar, Inc., VA
703-645-0280/fax: 703-645-0286 Featured Ar ticles
Vice President-Finance
Surviving the Perfect Storm 8
Robert B. Brown, PE Valerie Behrendt
PMA Consultants of Illinois, LLC, IL This is the sixth in a series of monthly articles from Kildrummy, a global project cost management solution
312-920-0404/fax: 312-920-0405 provider. This white paper series, Cost Management: Roadmap to Project Success, was created especially for
e-mail: [email protected] AACE International. The articles deal with such topics as best practices, lessons learned, the benefits of in-
Vice President-Administration house cost management expertise, standardization, and selecting the right toolset for the job at hand. These
William E. Kraus, PE CCE issues and topics address AACE International's commitment to total cost management.
B & C Project Services, CO
970-206-0947/fax: 970-226-1818 The Effect of Early Freezing of Scope on Project Schedule 12
Dr. Neil N. Eldin, PE
Vice President-Regions With the objective of finding means to reduce project delivery time, a number of schedule improvement meth-
Marvin Woods, CCE ods (SIM) were examined to determine their effectiveness in schedule reduction. The researcher focused on
Project Controls Group, Inc., MO
means that lead to reduction of project delivery time without increasing project overall cost. As a result, all the
314-838-4987/fax: 314-389-8957
cost-time trade-off methods (e.g., overtime, multiple-shifts, more costly crew mix, etc.) were excluded. Among
the promising SIMs were methods used to achieve early freezing of project scope. Three case studies were
Vice President-TEC examined to determine the implementation highlights, success factors and implementation barriers.
James G. Zack Jr.,
Fluor Daniel, CA
949-349-7905/fax: 949-349-7919 The Case of US Projects in Europe — 21
Guidelines to Mitigate Schedule Delay, from the Owner’s Viewpoint
Director-Region 1
Massimoluigi Casinelli, PE CCE
Mustansir H. Raj, CCE
Bantrel, Calgary, Canada This study analyses the problem of schedule delay on US government construction projects in Italy. This analy-
403-282-6545/fax: 403-290-5050 sis was undertaken from the owner’s point of view. The purpose of this article is to identify corrective actions
e-mail: [email protected] that could be implemented by the owner.
Director-Region 2
Charles E. Bolyard Jr., PSP Construction Baseline Schedule Review and Submittal Timeframe 28
McDonough Bolyard Peck, Inc., VA Dr. Win G. Li, PE CCE PSP and David J. Carter
703-641-9088/fax: 703-641-8965 A thoroughly planned and developed baseline schedule can effectively assist management in tracking
resources. In the event that the schedule duration, logic, resource or budgeted cost requires modification, a
Director-Region 3 well developed baseline schedule will benefit greatly in the updates. In addition, the project schedule will be
Robert E. McCoy, CCC one of the most critical elements in the review and/or approval of changes.
BWXT Y-12, LLC, TN
865-482-7658
In This Issue
Director-Region 4
Jeffrey D. Kursave, CCC Board of Directors Contact List ........................1 Books Available for Review ..........................36
SAIC., MO Proposed AACEI Amendment......................18 Index to Advertisers ......................................37
636-379-9314/fax: 314-344-4349
Call for Education Board Volunteers ..........36 AACE International Bookstore ....................42
Director-Region 5
Stephen W. Warhoe, PE CCE On the Cover: The 2004 PTI Structure Awards Competition First Place Award recipients. Images courtesy of
303-740-2665 the Post-Tensioning Institute (PTI), www.post-tensioning.org
Director-Region 6 COST ENGINEERING AACE International Headquarters

Mark G. Grotefend, CCC Vol. 47, No.2/February 2005
209 Prairie Avenue, Suite 100
253-835-8081 Managing Editor - Marvin Gelhausen Morgantown, WV 26501
e-mail: [email protected] e-mail: [email protected]
ph: 800.858.COST
Interim Executive Director Graphic Designer/Editor - Noah Kinderknecht
e-mail: [email protected] fax: 304.291.5728
Andrew S. Dowd, Jr.
Policy concerning published columns, features, and articles -
Viewpoints expressed in columns, features, and articles published in Cost Engineering journal are solely those of the authors and do not represent an official position of AACE
International. AACE International is not endorsing or sponsoring the author’s work. All content is presented solely for informational purposes. Columns, features, and articles not
designated as Technical Articles are not subject to the peer-review process.
Cost Engineering (ISSN: 0274-9696) is
published monthly by AACE International,
Inc, 209 Prairie Ave., Suite 100, Morgantown,
P resident’s
P resident’s Message
WV 26501 USA. Periodicals postage paid at
Morgantown, WV, and at additional mailing
office. POSTMASTER: Send address
Clive D. Francis, CCC
changes to AACE International; 209 Prairie President
Ave., Suite 100, Morgantown, WV 26501
USA. Single copies: US$8 members/ US$12
nonmembers (both +shipping), excluding
special inserts available to AACE members
only. Subscription rates: United States, Search Narrows for New AACE
US$65/year; all other countries, US$82/year.
Overseas airmail delivery is available at
US$99. Subscriptions are accepted on an
International Executive Director
annual-year basis only. Copyright © 2005 by
AACE International, Inc. All rights reserved.
y the time this message makes it into dates. The process included each of the
B
This publication or any part thereof may not
be reproduced in any form without written
permission from the publisher. AACE
the Cost Engineering journal, the search committee members asking a series of
assumes no responsibility for statements Board of Directors will have inter- questions. On Sunday, the process was
and opinions advanced by the contributors
to its publications. Views expressed by them viewed five candidates for the position of repeated to complete the conversation with
or the editor do not necessarily represent Executive Director of AACE International. all of the candidates.
the official position of Cost Engineering, its
staff, or AACE International, Inc. Printed in The search for a new Executive Director Each member of the search com-
York, PA, USA. Cost Engineering is a started in early September 2004. That is mittee compiled their independent results
refereed journal. All technical articles are
subject to review by a minimum of three when the search committee posted a position based on the conversations with each of the
experts in the field. To submit a manuscript vacant advertisement with the American candidates over the weekend. Each of the
for peer review, please e-mail it to
[email protected]. Cost Engineering is Society of Association Executives (ASAE). members evaluated the candidates on the
indexed regularly in the Engineering Index., The position vacant advertisement responses to the questions which were asked
Cambridge Scientific Abstracts, by EBSCO
Publishing, and in the ABI/Inform database. drew over 65 applicants from all over the US. by themselves and the other members of the
Cost Engineering is available online, via the
ProQuest information service; on microform;
Based on the criteria established by the committee. Each committee member then
electronically on CD-ROM and/or magnetic search committee, the initial 65 candidates sent their individual results to the President
tape from Bell & Howell Information and
Learning, PO Box 1346, Ann Arbor, MI 48106.
were reduced to the 15 who best fit the Elect who compiled the results into a single
Photocopy permission : Authorization to expectations of the search committee. overview of the candidates. This overview
photocopy articles herein for internal or
personal use, or the internal or personal use The 15 candidates were then asked ranked each candidate and clearly identified
of specific clients, is granted by AACE to complete applications for employment the top candidates. The interesting point was
International, Inc., provided that the base
fee of US$4.00 is paid directly to Copyright and submit these for review. The next task that the search committee was nearly unani-
Clearance Center, 222 Rosewood Drive, was to check the references to determine mous in their ranking of the candidates.
Danvers, MA 01923 USA. Telephone:
978.750.8400. For those organizations that accuracy of the data presented. Of the 15 What was the next step? The top five
have been granted a photocopy license by candidates, further screening resulted in 13 candidates were invited to the Winter Board
CCC, a separate system of payment has
been arranged. The fee code for users of the candidates being considered for further meeting where they were interviewed by the
transactional reporting service is ISSN- review. full Board of Directors. The full board asked
0274-9696/02 US$4.00. This permission to
photocopy does not extend to any Cost All of the work to review the infor- a series of questions of each of the candidates
Engineers’ Notebook, AACE Recommended
Practices supplements, or membership
mation provided by the candidates was left to within the criteria established for the position
directories published in this magazine members of the headquarters staff and the of the Executive Director. This was a much
and/or special inserts. Payment should be
sent directly to CCC. Copying for other than
Interim Executive Director. They did a very longer interview of the candidate and delved
personal or internal reference use without good job of establishing the methods and into more detail than the search committee
the express permission of AACE is
prohibited. Address requests for permission
processes to work through the large amount was able to get into during the December
on bulk orders to the editor. ADVERTISING of data. interviews. Based on the Board interviews, a
COPY: Contact Network Publications Inc.,
Executive Plaza 1, 11350 McCormick Road, Suite It took several conference meetings maximum of three candidates were invited
900; Hunt Valley, MD 21031. Telephone: 410.584.1966. for the search committee, but they estab- for additional interviews at AACE
E-mail: [email protected] for
rates. Advertisers and advertising agencies assume lished a series of questions in five areas of the International headquarters in Morgantown.
liability for all content (including text, defined criteria. In early December 2004, the So what does all this lead to? The
representation, and illustrations) of
advertisements printed and also assume search committee met to prepare for the expectation is that in late Spring 2005,
responsibility for any claims arising interviews of the 13 candidates. As part of this AACE International will have a permanent
therefrom made against the publisher. The
publisher reserves the right to reject any last conference, the search committee went Executive Director who has gone through an
advertising that is not considered in keeping through a live practice with the Interim extensive screening and interview process.
with the publication’s mission and
standards. The publisher reserves the right Executive Director acting as a candidate. The process of finding an Executive Director
to place the word advertisement with copy
which, in the publisher’s opinion, resembles
This meeting was a precursor to the actual has been an intensive process but has been
editorial matter. All advertising accepted for interviews which occurred in December. carefully thought out to make sure we do find
publication in Cost Engineering is limited to
subjects that directly relate to the cost
In the middle of December, the an acceptable candidate to lead our associa-
management profession. Current rate card search committee took a weekend to inter- tion.
available on request. COST ENGINEERING
DEADLINES : Submissions for Cost view the 13 candidates. On Saturday, the It is the desire of the search commit-
Engineering must be received at least 7 committee contacted and interviewed over tee that when you come to the Annual Meeting
weeks in advance of the issue date. Send to:
Editor, 209 Prairie Ave., Suite 100, half of the candidates, spending a consider- in New Orleans you will be meeting the new
Morgantown, WV 26501 USA. Deadlines do able amount of time talking with the candi- AACE International Executive Director. ◆
not apply to technical papers.
Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 3

San Francisco Bay Area and Southern California Sections’
49th Western Winter Workshop
March 11-13, 2005
lease mark your calendars for the San Francisco Section's For information regarding the social events and the golf tourna-
P 49th anniversary of the Western Winter Workshop. The

workshop will be conducted at The Monterey Beach
Resort on March 11-13, 2005, in picturesque Monterey California.
ment contact John Haynes at 925-736-2654. Anyone wishing to
help out with this event please contact John Haynes.
The 2005 topic will be, "Tools of the Trade." Make Your Hotel Reservations Early and Save!
The Technical programs will be on Saturday and Sunday For the hotel’s special nightly group rate of $119.00 Gardenside
March 12-13. Friday, March 11, will be reserved for a certification and $169.00 Oceanside, call the resort's direct number at (800)
review seminar, as well as the second annual President Cup Golf 242-8627 prior to February 8, 2005. To get this rate you must ask
Tournament at the beautiful ocean course in Pacific Grove. for the AACE International Western Winter Workshop and reserve
For information regarding the technical program contact under the group name AACE. So take advantage of this great rate!
Samir Messiah, PE CCE, at 209-988-9937. The reserved block of rooms are being held on a first come, first
serve bases, so don’t miss out!
4 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

I Inn Our
Our Estimation
Estimation
Andrew S. Dowd, Jr, PSP
Interim Executive Director
On to New Orleans
nder the direction of our President Elect Phil Larson, The 2004 Annual Meeting was solidly profitable.
U preparations for our Annual Meeting in New Orleans,

June 26-29, 2005, are really starting to “roulez”... as in
“Laissez Les Bon Temps Roulez,” but more about that later!
Membership is climbing. All measurable performance figures
were as good or better than any point in AACE International his-
tory, with the notable exception of Annual Meeting attendance.
The AACE International staff would like to extend its grate-
A Successful 2004 ful thanks to the membership for its many acts of professionalism
2004 ended very well for AACE International. We managed and support. The Board of Directors has worked actively and pro-
to come in on budget in spite of new services and one time fessionally in direct support of the Headquarters staff to achieve
expenses, such as the Executive Director search. That search such a performance in 2004. I extend my personal thanks to the
process is on schedule and will cost the association at least Vice President-Administration and President for helping me
$50,000 less than the previous search. understand how I could contribute to the association’s great 2004.
Many of the Headquarter’s operations efficiency improve- Breaking in a rookie was tougher than they thought!
ment efforts are now being implemented. These include mailings
which are less time consuming, streamlined budget and account- About This Year’s Annual Meeting
ing practices, integration of large association databases, and The Headquarters staff is excited, as we already see signs of a
improved e-mail which includes upgraded anti-virus and spam fil- “blowout” meeting. For instance, the number of signed exhibitors
ters. We have also largely shifted all reporting to electronic, or has already exceeded the final numbers from the 2004 meeting.
“paperless”, means. This year, even Microsoft and PMI are expected to join us. Our
The AACE International Corporate Sponsorship Program site visits confirm that we have a great venue, and you will be
(CSP) continues to grow, adding three new members in the last directly receiving some of the hotel’s publicity, tailored for AACE
90 days. We initiated focused surveys and increased membership International. The technical program is set, and even the “voodoo
benefit information to CSP members. The marketing committee spirits” have been consulted and agree that “the occasion promis-
has been completing the high priority action items which were es to be most rewarding, especially for those looking for fun at the
identified in the strategic plan review in September, 2004. meeting.” (Just kidding.) Don’t wait to join up. The $100 rebate
2004 revenues for publication sales, the Distance Learning is a “best buy.”
Program, Cost Engineering journal advertising, and AACE
International website employment ads all increased by more than The 2005 AACE International Elections
60 percent from 2003. Of special importance, the technical divi- We have an outstanding slate of candidates for this year’s
sion product sales increased to 689 titles. This is a 98 percent elections. Some offices have three or more strong candidates.
increase. The amount of certified members has reached all time While the election process is underway, please remember that
highs in total certified members, 1041, and percentage of mem- any form of “campaigning” is contrary to our Canon of Ethics. ◆
bership certified, 24 percent. This is a one year increase of over
seven percent!
A Note About Dues

AACE International membership dues were due on January 1, 2005.
In the past AACE International has extended “courtesy” benefits to some members who were up to 60
days in arrears. We can no longer afford to continue this practice.
Do not risk a gap in membership services, including delivery of the Cost Engineering journal.
If you have not yet paid membership dues for 2005, and would like to take this opportunity, you may do
so online at AACE International’s website, https://www.aacei.org/join/renew.shtml, or by calling the
AACE International Headquarters at 1-800-858-COST.

KEEP UP TO DATE ON AACE INTERN
NEW ORLEANS, JUNE 26-29, 2005
AACE's Headquarters Hotel:
Sheraton New Orleans
Reservations (504) 525-2500
www.sheratonneworleans.com
Use the code "AACE Annual

Meeting" to get our special rates;
rooms cannot be guaranteed at the dis-
counted rate after Friday, June 3, 2005.
NEED A REASON TO ATTEND

THE ANNUAL MEETING?
Try one of AACE's Top 10 Reasons!
10 - Alligators usually don't eat people
9 - It's the perfect excuse to tell your boss

that you're doing something useful
8 - Suck the head off a crawfish -- earn

your CCE (certified crawfish engi-
neer)
7 - Peer pressure...everyone else will be

there.
6 - You can eat an entire year's worth of

fried seafood in just 3 days!
5 - It's the perfect opportunity to stock up

on your bead-necklace inventory
4 - Take up a second language -- Cajun!
3 - You can audition for AACE Members

Gone Wild video
2 - Sheraton hotel soaps make nice gifts
1 - Come see the Voodoo that we do so

well!

ATIONAL'S 49TH ANNUAL MEETING
5 - DETAILS AT WWW.AACEI.ORG!
THIS SPACE
RESERVED FOR
YOU!

Image courtesy of the New Orleans Metropolitan Convention and Visitors Bureau, photo by Richard Nowitz
SSpecial Series
pecial Series
Valerie Behrendt
Surviving the Perfect Storm

Editor’s Note: This is the sixth in a series of monthly articles from Kildrummy, a global project cost management solution provider.
This white paper series, Cost Management: Roadmap to Project Success, was created especially for AACE International. The arti-
cles deal with such topics as best practices, lessons learned, the benefits of in-house cost management expertise, standardization,
and selecting the right toolset for the job at hand. These issues and topics address AACE International's commitment to total cost
management.
ABOUT THIS ARTICLE

Jack Hartung, formerly with the Independent Project Downsizing and Outsourcing: The First Storm System Builds
Analysis (IPA), and now the manager of cost engineering and With the constant downsizing during the past decade in the
benchmarking for ChevronTexaco, shared a presentation oil and gas industries, owner resources have been reduced con-
called, “The Perfect Storm,” at the recent Oil and Gas Industry siderably. Cost engineers in particular have seen their ranks thin
breakfast in Houston. within some owner organizations such that as few as five cost
This article represents the topic covered in that presenta- engineers may be overseeing billions in capital spending.
tion, as well as the subsequent interview with Hartung, and is Rebuilding these capabilities has also been neglected.
the last in a series of six white papers created by Kildrummy for During the past decade there has been a prevailing belief that
Cost Engineering journal and AACE International. many functions associated with a project can simply be out-
Kildrummy's mission is to add value through software, services sourced. Although owners are now realizing that this belief is
and knowledge sharing; the entire cost stewardship white paper largely in error, it may be too late.
series is available for download at www.kildrummy.com. We For example, with the shift in the owner/contractor relation-
at Kildrummy are proud to share AACE International's com- ship—owners have often neglected the value of cost engineering
mitment to total cost management. and have subsequently failed to maintain adequate cost engi-
neering capabilities such as detailed cost databases and calibrat-
Valerie Behrendt ed estimating tools in house. So what's the problem?
Marketing Manager In principle there is nothing wrong with outsourcing; the
Kildrummy critical element is which responsibilities you shift. Research
[email protected] shows that when owners recognize the respective roles and
responsibilities and do a good job determining where contractors
urrently the process industries in the US are confronted fit, outcomes are good. Think of the owner as the head and the
C with a challenging combination of factors that could

seriously degrade the quality of capital investment in the
next five to 10 years.
contractor as the body—the owner has to think carefully about
how to use a contractor effectively. It is the owner's responsibility
to define scope and objectives and manage the contractors. The
These challenges are not the typical market-driven variety: contractors' job is to execute effectively within parameters
instead they are in many ways self-imposed. Three of the most defined by owners.
pressing challenges include the following. Obviously, when it comes to project cost management, there
is a natural disconnect between the owner and contractor.
• an increase in capital spending to recuperate from several Owners and contractors are driven by fundamentally different,
years of retrenchment; but not necessarily mutually exclusive business objectives.
• 2) an aging workforce with a dearth of more experienced per- Owners are driven by a need for predictability and competi-
sonnel to backfill imminent retirements; and tiveness in outcomes. Contractors are driven at least in part by the
• 3) the continued absence both of available company process- size of their contract. Because of these differences in objectives,
es and the discipline to follow them. the roles for the owner and contractor on a project are necessari-
ly different. For example, contractors shouldn't be asked to devel-
Although not at a crisis level yet, the combination of these op an owner's business objectives. Unfortunately, they often are,
three challenges could lead to a significant erosion of capital proj- because an owner doesn't always fulfill his obligations during
ect quality in the near future if not addressed. To ensure that project development, and because of this the project and the
these converging and synergistic forces do not result in a "Perfect owner suffer. Clearly, with a better understanding of roles,
Storm" it is essential that companies begin standardizing (within responsibilities and expectations by both parties, the likelihood of
an acceptable bandwidth) and enforcing processes and proce- successful projects is enhanced.
dures for capital project development and execution. In the end, maintaining a credible cost engineering capabil-

ity is one of the critical functions that an interpretations from project to project. its time has come.
owner needs to maintain in house. "Improvement on a project level doesn't Only recently have companies begun
Unfortunately, in many organizations, this always add up to improvement on a sys- to investigate standards with a serious eye
has not been the case. tems level," claims Hartung. The lack of a toward how best to implement them. To
system wide set of enforceable standards be workable, standards must also make
The Graying of the Work Force: can result in "death by a thousand cuts." sense, support good behavior, and have a
Another Storm Gathers at the Horizon The result? "This is knowledge that has certain amount of flexibility.
Outsourcing key functions to contrac- been bought very expensively—and com- Standardization has been resisted not only
tors is but one piece of the puzzle. panies are just letting it go." because it requires change and because
Demographics also plays a part —the enforcement is difficult—but because a
median age of a cost engineer is 48 years. Capturing Cost Data is Clearly a Key project team has enough heartburn. They
The problem is magnified when you con- Piece for Project Owners are looking for tools to make their lives eas-
sider the distribution—a large gulf exists "Capturing data delivers the most ier, not another hoop to jump through.
between those approaching retirement benefit when it is based on shared prac- Naturally, all other things being
and those just beginning their careers. tices and a standard WBS so that it is rela- equal, tools that make your life easier are
The consequences of that distribution tively straightforward to understand the more readily adopted than those that need-
are manifold and are largely negative. progress and compare it in a single data- lessly complicate matters and remove cre-
Within 10 years many owners will have base—so that project professionals ativity and flexibility from the project
lost not only a significant amount of expe- become well versed in the mechanics of team. Still, the question remains: Why pay
rience, but also the opportunity to capture it," says Hartung. Today, however, few for the knowledge and experience of a sea-
it. Moreover, without seasoned profes- companies are set up in any simple fashion soned cost engineer, then force him to
sionals to take up the reins, those remain- to capture project information in a consis- work in a certain way? Is a best practices
ing could potentially be left to fend for tent manner. "Companies that are regard- solution meant only for those at the lower
themselves without experience to guide ed as leaders in capital project perform- end of the age and experience demo-
them. ance tend to be heavily process driven. graphic?
Staff reduction and outsourcing has Ability to follow processes is a competitive Not at all. More experienced cost
clearly led to the depletion of vast quanti- advantage…There is plenty of evidence, engineers are happy to not reinvent the
ties or experience and knowledge for not only anecdotal but IPA research to wheel. Having a standard WBS, a solid
owner companies within our industry, support the notion that in house cost capa- cost database, and a set of reporting tem-
which some experts put even closer than bility and an in house cost database are a plates as a place to start, adds value in that
2014—in fact, within the next four years. best practice." it allows engineers to hit the ground run-
The challenge lies in attempting to back- Taken together, the lack of owner ning. A seasoned cost expert brings much
fill those vacated positions by hiring expe- resources, increased capital spending, and more to the party in terms of what to do,
rience, while capturing the knowledge of a lack of standard process to capture data rather than how, specifically, to do it.
people who are leaving and encapsulating are gathering at the edge of a ten year hori- Bottom line? Cost engineers should be
it in such a way that it can be easily shared. zon, or less. How can the process indus- doing more than just creating a WBS.
tries prepare for what could lead to a sig- Moreover, a standard WBS need not
The Third Storm System: Inconsistent nificant erosion of capital project quality? be a rigid roadmap that treats every project
Processes alike. A standard WBS may go only three
Looking back at lessons learned, how- Surviving the Perfect Storm levels down, with an additional three or
ever, may fall short of what is required. One thing that is critical to preparing four levels wherein the individual project
"There frequently is no standard approach for and ultimately surviving the "perfect has the flexibility they need to support
when it comes to things associated with storm" is a standard approach. IPA their unique requirements. In a project-
cost engineering," maintains Hartung. research indicates that standardizing on friendly best practices software toolset,
"Even when the processes are available, best practices solutions can drive cost over- there is room for locking in standards at
having standard processes is not the same runs down by as much as 15 percent. For certain key points and leaving flexibility at
as having the discipline to use them and companies with capital programs of bil- the lower levels, while rolling up to a stan-
efforts to capture lessons learned are not lions of dollars, the financial benefits of dard, high level summary that allows cor-
uniform in what they cover. standardization would seem to outweigh porations and agencies to attain the bene-
Industry benchmarks show that most the challenges faced in creating and fits of standardization.
companies' lessons learned efforts are not enforcing standard solutions.
producing benefits because companies Up until recently, however, standardi- Best Practice Solutions—A Way Forward
don't know how to create a usable lessons zation has been the Siberia of value: every- Best practice solutions for project cost
learned process. They are either specific to one knows where it is, but nobody wants to management can enable standardization
a single project—or the process is insuffi- go there. One manager of global project on those practices that deliver value, not
ciently facile to allow anything to be controls has put it this way: "Everyone only on a project level but for a business
learned from it." likes the idea of standardizing - as long as unit, division, or enterprise as well.
Even in companies that have a project we use my standards." Getting buy in can A secondary, though far from insignif-
process, it may be subject to fairly liberal be a long and painful political process, yet icant benefit of a common best practices

solution, is that it offers an early warning. worked in providing cost and program
This type of information, when available management solutions on large projects in
real time, affords the capability of diagnos- transportation, infrastructure, energy and
tic, rather than forensic evaluation, while facilities construction. Behrendt leads the
there is still time to affect outcomes. US sales and marketing team from
Third, software solutions with owner's Kildrummy’s international headquarters
processes built in can encourage and pro- in Houston’s “Oil and Gas Corridor,” and
mote healthy practices in cost manage- holds a BS from the University of
ment by both seasoned and green engi- California at Berkeley. She belongs to AACE International’s
neers. When projects are your business, National Association of Female
standardizing on a proven cost manage- Executives, and is a member of AACE
Publications Department
ment solution can help make the differ- International. has a new e-mail address
ence between failure and success. ◆ for all of your AACE
Jack Hartung is manager of cost engi-
ABOUT THE AUTHORS neering and benchmarking with Publication needs.
ChevronTexaco. Mr. Hartung graduated
As Sales and Marketing from Grinnell College and UC Berkeley
Manager for Kildrummy with degrees in chemistry. He left the aca- Just send your e-mail to:
Inc., Valerie Behrendt demic world to join Independent Project
brings 20 years of expe- Analysis (IPA) and spent 13 years at IPA [email protected]
rience in sales and helping to build its US and European
marketing manage- offices, and established the Australasian
ment with high tech- office in Melbourne, Australia. His experi-
nology leaders in ence includes reviewing more than 450
California’s Silicon Valley, beginning as projects and project systems executed by a
marketing coordinator with Novell in long list of owner companies in a broad
1983. A principal at SMA, Behrendt mar- variety of industries.
keted sales management training to clients
including HP, Network Associates, and
Semantec. Since 1996, Behrendt has

SSpecial Feature
pecial Feature
Katie Lee
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T ECHNICAL A RTICLE
early identification of project requirements
and decisions that would significantly
The Effect of Early Freezing of affect the project delivery time. Such
methods would direct the attention to
Scope on Project Schedule selected issues and details that could be
postponed to be addressed at later dates.
Early identification and proper
Dr. Neil N. Eldin, PE handling of such tasks under normal
practice could favorably impact the project
ABSTRACT: With the objective of finding means to reduce project delivery time, a number of delivery time.
schedule improvement methods (SIM) were examined to determine their effectiveness in sched- MEFS can be viewed as a means to get
ule reduction. The researcher focused on means that lead to reduction of project delivery time all parties involved in the scoping of a
without increasing project overall cost. As a result, all the cost-time trade-off methods (e.g., over-
project to identify time-sensitive issues in
time, multiple-shifts, more costly crew mix, etc.) were excluded. Among the promising SIMs
were methods used to achieve early freezing of project scope. Three case studies were examined
the early development phases. It is a means
to determine the implementation highlights, success factors and implementation barriers. The by which input from key stakeholders (i.e.,
case studies verified that measurable schedule reduction could be realized by early freezing of engineering disciplines, operation /
project scope. The data suggested that reduction up to 20 percent of the project delivery time maintenance staff, owners, etc.) is obtained
compared to historical data could be realized. In addition, implementation of methods for early in the conceptual phase and monitored in
freezing of project scope resulted in net cost savings for the documented projects. Success fac- the detailed design phase to ensure
tors, implementation barriers, and lessons learned were grouped under management, employ- compliance with the approved scope and
ees, and process issues. These issues were further ranked according to their apparent frequency the identified decision points' deadlines.
in the case studies. Although the limited number of case studies did not allow the determina-
Designers should obtain input from
tion of statistical significance, such ranking provides a framework to which future data could be
added for more comprehensive conclusions.
owners, suppliers, constructors, and
operation and maintenance personnel
KEY WORDS: Project, schedule, scope prior to finalizing their designs. It is crucial
that all involved parties prioritize their key
requirements and identify their critical
he identification of methods implementation highlights, challenges,
T capable of reducing project delivery

time has been the goal of many
researchers and American companies [2, 3,
and success factors observed in three case
studies. Although the number of cases was
not enough for determining statistical
interfaces with others.
A comprehensive examination of the
prioritized requirements would result in
distinguishing critical design parameters
4, 5, 7, 8, 9, 10, 11]. significance, a process for the assessment of
that must be finalized early from those that
Researchers identified a number of the critical issues is presented just as a
can be postponed without adversely
techniques that seemed to have the highest framework to which data could be added in
impacting progress.
payoff potential [1]. These included the future for more comprehensive
Decisions must be finalized early on
methods that are used for early conclusions.
the critical ones. Deadlines for obtaining
identification of key design parameters to
final decisions on the identified critical
achieve early freezing of project scope. METHODS FOR EARLY
issues and parameters must be established
The objective of early freezing of FREEZING OF SCOPE
early with the concurrence of all affected
scope is to eliminate the uncertainties
parties. In other words, MEFS contrasts
associated with design and procurement of Continuing modifications to project
the traditional design process in which
major items so that various engineering scope beyond the final authorization of
decisions made by a discipline are
disciplines are able to proceed with funds would inevitably result in prolonging
controlled only by that discipline. In
detailed design and material procurement the project duration and hence increasing
MEFS approach, priorities and schedules
as soon as funding approval is obtained. final project costs. Freezing of scope at the
are developed by all disciplines,
Items viewed as having measurable earliest appropriate time is essential to
concurrently.
influence on project costs and duration allow efficient completion of detailed
In the investigated case studies, the
should be identified prior to enforcing a design and material procurement and
approaches to MEFS varied between
scope freeze. As an example from the eliminate inefficiencies inherent in
formal and informal procedures. On the
process industry, a major pump is defined redesign and rework.
formal side, one company's practice was to
by type, performance, material, and As a schedule reduction approach,
use preprinted forms and scheduled
operating parameters. Once the scope was methods of early freezing of scope (MEFS)
sessions to identify the critical issues and
frozen for the pump, detail design of its are defined as any systematic approach to
foundation, connecting piping, power/fuel
system, and other auxiliary systems could
start. Case Study # Specialty Type
This article describes some of the •1 Eng.-Construction Designer
methods used for achieving early freezing •2 Pulp and Paper Contractor
of project scope. The article presents the •3 Utility Owner
Table 1—Nature of Business of Companies Associated with Case Studies

interfaces early in the project development On the informal side, one company were similar in nature and short in
cycle. established a less structured procedure for duration (less than $100,000 and 3-month
Another company adopted quality identifying critical issues and their duration).
function deployment (QFD) as a formal appropriate deadlines. The procedure
procedure for identifying requirements, involved preparing a monthly milestone CASE STUDIES
translating requirements to design schedule showing critical decision points
parameters, prioritizing such parameters as identified by the project manager. The Three case studies were documented
and identifying the critical interfaces that milestone schedule was used as a reminder in which MEFS was the primary means to
needed early decisions or commitments. to all disciplines of setting deadlines for reduce project delivery time. The case
Full discussion of QFD method and their critical decision points. This studies involved:
implementation steps could be found in company advocated that a more formal
reference [6]. approach was not justified, as all its projects
Case-1 Case-2 Case-3

A pharmaceutical R&D facility with 1.1 The project involved the A number of capital improvement
million sq. ft. of usable space of office, development of a new product that projects for the power industry. Average
commercial, and industrial areas. The required new technology, new process, cost was $100 K each. These were short
facility is built on over 200 acres site. new mill, and new training operators. The projects (1-3 months) in which the focus
The project contract price was $260 project delivery time was 18 months and was on plant outage and impact on
million and involved 150 bid packages. the contract price was $100 million. related projects.
The project delivery time was 46
months, of which 20 months were the
design phase.
Table 2—Scope Summary of Case Studies

1. Over 20% reduction of project 1. The mill was completed one month 1. Early freeze of scope (up to 18
delivery time. Project was placed ahead of schedule and met planned months before construction)
online 8 months sooner than similar production during the start-up phase. resulted in early establishment of
fast track projects. 2. The mill was completed 5% under fiscal year budget and project funds.
2. The timesavings resulted in unit budget. 2. Working off a well-defined early
prices 15 % below company's 3. The time reduction resulted in early scope enhanced the utilization of
historical performance. destaffing of 4 months ahead of the limited capital resources.
3. Construction had fewer incidents of schedule, which typically starts 12 3. Reductions of up to 7 days in a 60-
rework and fewer number of change months after construction day outage (12%). Reduction of
orders. completion. outage durations due to early scope
4. Customers' satisfaction improved, 4. As a result of excellent quality records, definition, thus allowing early
which resulted in increased number 90% acceptance on lot audit was completion of engineering and
of negotiated contracts and achieved in the first month (increased long-lead materials procurement.
development of formal partnering to 99% by 7 month), which resulted in 4. Outage reduction allowed higher
with major customers. saving the cost of 12 auditing power availability (in lieu of
personnel. purchasing power).
5. Better power generation planning
due to well-defined outage scope
and duration.
Table 3—Results and Pay-off

1. Owner requested a more accurate 1. Learning the QFD process and 1. Top management demand of
project budget. realizing its benefits encouraged a improved capital utilization.
2. Project profitability was sensitive to young product developer to pursue its 2. A forced downsizing required
capital cost and hence to the scope application. reduction of project delivery time to
attempted. 2. A department manager who believed improved processes efficiency.
in empowering up-coming promising
staff and decided to support the ideas
of a young product developer.
Table 4—Drivers for Implementation

• installation of a research and RESULTS AND PAYOFFS were interested in achieving more efficient
development facility; work processes for personal job satisfaction,
• a new paper mill; and Measurable schedule reduction was individuals who were interested in
• the refurbishment of an existing utility achieved on the three case studies as a enhancing their skills by applying new
plant. result of implementing MEFS. Up to a 20 tools, and top management that was
percent reduction of project delivery time interested in shortening project delivery
The nature of the business associated compared to historical performance was time to maintain its reputable stature in
with each case study is shown in Table 1 realized. In addition, other payoffs the market. Table 4 summarizes the
and the scope of each case study is included reduction in cost of audit and MEFS implementation drivers as stated by
summarized in Table 2. Throughout this maintenance of control budget, reduction the projects' personnel.
article, data is provided in a tabular format of rework, improved customer relationship,
to facilitate presentation and comparison and improved product performance. Table SUCCESS FACTORS
among the case studies. Because of space 3 summarizes the payoffs as stated by the
limitations, only a data summary is project personnel. It was found that the use of graphic
provided. A complete listing of the raw communication/design tools such as 3-D
data including preprinted interview forms IMPLEMENTATION DRIVERS computer aided design and drafting (3-D
for each case study can be found in CADD) contributed to good
reference [1]. Details of the The implementation of MEFS was communication with the end-users. The 3-
implementation of driven in some cases by top management's D CADD gave the users the ability to see
mandates and in others by employees' and understand the project details, as they
initiatives. That included individuals who were conceived/developed by the design
Employee Related Issues Management Related Issues Process Related Issues

1. Technical skills of individuals. Success Factor 1. Use of the latest technologies (3-D
2. Interpersonal skills. 1. Visible support for achievers. CADD, walk-through computer
3. High personal commitment to team 2. Willingness to accept the results of models, operations simulation
success. risk taken by the staff. techniques, etc.
4. High trust between owner, 3. Investment in Training. 2. Involvement of end-users.
contractor and designer staff. 4. Development of high trusting 3. Process continuity.
/empowerment environment among
management and project teams.
5. Top management's visible/direct
support of project teams' decisions.
Implementation Barriers
1. Lack of continuity of project 1. Lack of budget. 1. Exploring alternatives and VE
personnel (moving staff in the efforts could turn into open-ended,
middle of the project). time-consuming exercise unless it is
controlled.
2. Misconception of the optimum
degree of end-user involvement
3. Lack of process understanding
4. Under-developed procurement
strategy and construction schedule
5. Inability to determine cost-benefit
ratio for MEFS.
Lessons Learned
1. A sponsor/ champion is a must for 1. Visible, strong support is a must 1. Proper involvement of end-users
every major task 2. Set demanding, but achievable goals 2. Early invitation of ideas from all
2. Cultivating team spirit is essential 3. Owners/proponents must drive/lead parties involved
the MEFS implementation 3. Maintaining system flexibility in
handling valid exceptional changes
4. Focusing attention on process not
participants
5. Training is the first step
Table 5—Description of Common Issues

Issue Case-1 Case-2 Case-3 Frequency Weight (%)
Employee Related
1. Technical skills of individuals YES YES 2 40%
2. Interpersonal skills YES 1 20%
3. High personal commitment to team YES 1 20%
success
4. High trust between owner, contractor YES 1 20%
and designer staff
Management Related
1. Visible support for achievers YES YES YES 3 44%
2. Willingness to accept the results of risk YES 1 14%
taken by the staff
3. Investment in Training YES 1 14%
4. Development of high trusting YES 1 14%
/empowerment environment among
management and project teams
5. Top management's visible/direct support YES 1 14%
of project teams' decisions
Process Related
1. Use of the latest technologies (3-D CAD, YES 1 33%

walk-through computer models, operations
simulation techniques, etc.
2. Involvement of end-users YES 1 33%
3. Process continuity YES 1 33%
Table 6—Significance of Common Issues in Success Factors
and execution teams. Good visual IMPLEMENTATION BARRIERS and decision points seemed to cause
communication of plans through 3-D problems.
models eliminated misunderstanding of Implementation of MEFS can be Overlooking the inclusion of
deliverables and contributed to earlier hampered by a number of issues. Although constructability reviews, project turnover
elimination of some uncertainties. In the involvement of end-users is important, plan and value engineering issues prior to
addition, the use of work breakdown they often had difficulties separating needs freezing the scope resulted in unnecessary
structures (WBS) to divide a project into its from wants. This problem added time to late design modifications and rework
smaller components seemed to contribute the process of freezing project scope and efforts.
to a quicker and more concise definition of led to a strained working environment
systems. It was also apparent to the staff in within the project team. Engagement in LESSONS LEARNED
charge of the case studies that MEFS team-building efforts early in the project
demands higher level of flexibility in seemed to help minimize this problem. The following lessons were extracted
rotating, staffing and de-staffing project Exploring alternatives while involving from the case studies:
resources to cope with the short-term needs a large multi-discipline team that included
for dedicated resources necessary to meet the designers, owner representatives, 1. It appeared that owners were the best
certain decision points' deadlines and customers, and the contractor created group to drive the efforts of early
permit certain components/systems to be open-ended, time-consuming exercises. It freezing of project scope, and the
developed concurrently in shorter than appeared that the process of assessing efforts of resisting changes after a scope
normal durations. The projects' staff also alternatives could have been made more freeze. Owners' representatives must
emphasized the criticality of close efficient by involving only a smaller group understand the benefits of early
management of interfaces between various encompassing the primary discipline(s) freezing of scope, be committed to the
components and disciplines. instead of attempting the evaluation in overall project objectives and stop
open session format. Also, the lack of pursuing minor incremental
intermediate checkpoints and absolute improvements beyond the scope
completion dates for identified milestones freeze point. Attempting a scope freeze
with no commitment from the owner

Employee Related
1. Lack of continuity of project personnel YES 1 100%
(moving staff in the middle of the
project)
Management Related
1. Lack of budget YES 1 100%
Process Related
1. Exploring alternatives and VE efforts YES YES YES 3 42%
could turn into open-ended, time-
consuming exercise unless it is
controlled.
2. Misconception of the optimum degree YES 1 14%
of end-user involvement.
3. Lack of process understanding. YES 1 14%
4. Under-developed procurement strategy YES 1 14%
and construction schedule.
5. Inability to determine cost-benefit ratio YES 1 14%
for MEFS
Table 7—Significance of Common Issues in Implementation Barriers
organization would result in disruption process must be adhered to when In other words, the weight is the ratio
of engineering, design, procurement, dealing with such exceptions. of frequency of an issue (i.e., number of
and construction activities and 7. Early freezing of scope was valid times appeared in the case studies) to the
ultimately in longer overall project regardless of projects' type or size. total frequency (i.e., the summation of the
duration. Emphasis on early, thorough planning number of issues times their frequencies).
2. Achieving buy-in from all stakeholders returned high dividends.
is essential prior to freezing scope in he case studies suggested that
order to ensure collective support of
the down stream decisions and to avoid
single-ownership attitudes. The use of
COMMON ISSUES
Examination of the detailed success

T conceptual development and
preliminary engineering needed to
be completed prior to freezing of project
a structured approach to project factors, implementation barriers and scope.
planning, involving all stakeholders, lessons learned suggested that they could Project definition should progress to
can facilitate this process. be viewed as employee, management, or the point of obtaining funds authorization
3. A formal structured process for review process related issues. Further (identification of project packages and
of key documents must be established examination of these issues suggested that preparation of semi-definitive cost
and enforced to support timely each group (employee, management, or estimates) before freezing scope.
review/approval process. process) can be summarized under more Evaluation of alternatives, value
4. It was recommended that executive generalized description such as that shown engineering, constructability input and
management must be involved in the in Table 5. Consolidation of the data in safety reviews should be completed prior to
approval of key project deliverables this manner facilitated the observation of freezing of the scope. All design concepts
prior to freezing the scope. In the common issues among the case studies. and project definition documents required
addition, management must show In an attempt to quantify the to solidify the scope of work should be
support of the project team in resisting significance (weight) of each of the reviewed and approved by representatives
changes and scope additions common issues shown in Tables 5, the of the end-user prior to development of the
advocated after the scope has been frequency of each issue was determined. authorization estimate and freezing of the
frozen. Tables 6 through 8 show the frequency scope.
5. It was recommended that the approval and weight of each issue describing success Deliverables required to be completed
of a set of agreed upon key documents factors, implementation barriers and prior to freezing of project scope vary by
would establish the baseline from lessons learned. The weight shown in industry and project type. Each company
which changes are measured. these tables is calculated as the weighted should prepare a list of typical deliverables
6. Provisions must be made for frequency of each issue. that once approved they serve as the
exceptional late changes. A structured baseline from which changes are

Employee Related
1. A sponsor/ champion is a must for every YES 1 50%
major task.
2. Cultivating team spirit is essential. YES 1 50%
Management Related
1. Visible, strong support is a must YES YES 2 40%
2. Set demanding, but achievable goals YES YES 2 40%
3. Owners/proponents must drive/lead the YES 1 20%
MEFS implementation
Process Related
1. Proper involvement of end-users YES YES YES 3 42%
2. Early invitation of ideas from all parties YES 1 14%
involved. YES 1 14%
3. Maintaining system flexibility in YES 1 14%
handling valid exceptional changes. YES 1 14%
4. Focusing attention on process not
participants.
5. Training is the first step
Table 8—Significance of Lessons Learned
measured. In addition, each company ACKNOWLEDGEMENT International Journal of Cost

should determine the specific steps in the Estimating and Project
appropriate approval cycles required to This study was funded by the Management, Vol. 41 No. 5, (April
accurately define the project and to freeze construction Industry Institute (CII), 1999): pp. 25-33.
the scope of work. Project 41-11. The author is indebted to 5. Eldin, N.N. and A. E. Senouci, A
Capital processes within individual the Schedule Reduction Reviewers' Panel Dynamic Programming Approach To
companies may not support the for their invaluable contributions to the Scheduling of Non-serial Linear
completion of these deliverables prior to success of this investigation. Projects with Single Loop Structure,
completing funding authorization. In such Journal of Advances in Engineering
cases, the scope should not be frozen until REFERENCES Software Vol. 31, No. 10, (2000): pp.
the deliverables have been completely 803-814.
determined. In addition, an effective scope 1. Eldin, N.N., An Investigation of 6. Eldin, N., A promising Planning Tool:
change control process must be in place to Schedule Reduction Techniques for the QFD, The International Journal of
handle changes beyond the scope freeze Engineering and Construction Cost Estimating and Project
point that are deemed crucial to the project Industry, Construction Industry Management, Vol. 44 No. 3, (March
success. Owners are the best group to Institute, Report 41-11, (Sept. 1996): 2002):pp. 28-37.
enforce early freezing of scope. pp. 143. 7. Karim, A. and H. Adeli. OO
The above conclusions are based on 2. Eldin, N.N., Concurrent Engineering: Information Model for Construction
the case studies examined in this study. A A Schedule Reduction Tool, American Project Management, Journal of
literature search did not result in data to Society of Civil Engineers, ASCE- Construction Engineering and
add to that presented in this article. Journal of Construction Engineering Management, ASCE, Vol. 125, No. 5,
Because of the small number of cases and Management, Vol. 123, No. 3, (1999): pp. 361-367
examined, this work should be viewed as (Sept. 1997): pp. 354-362. 8. Karim, A. and H. Adeli. CONSCOM:
an early attempt to understand the effect of 3. Eldin, N.N., Constructability Impact An OO Construction Scheduling and
early freezing of project scope on the on Project Schedule, Journal of Change Management System, Journal
project delivery time. It is hoped that more Construction Management and of Construction Engineering and
data will be added in the future to allow a Economics, Vol. 17, No. 6, (Sept. Management, ASCE, Vol. 125, No. 5,
more comprehensive conclusions. ◆ 1999): pp. 711-720. (1999): pp. 368-376.
4. Eldin, N.N., Key Issues in 9. Karim, A. and H. Adeli. A New
Implementing Cycle Time Analysis as Generation Software for Construction
A Schedule Reduction Tool, American Scheduling and Management,
Association of Cost Engineers, The Engineering, Construction and

Architectural Management, Vol. 6, Year Award in 1997, 1998, 1999, and 2002. the graduate program at Texas A&M
No. 4, (1999): pp. 380-390. He has impressive research records of over University and a faculty senator.
10. Senouci, A. E. and N.N. Eldin. A $1.5 million of funded research He can be contacted by e-mail at
Dynamic Programming Approach To documented in 50+ publications included [email protected].
Scheduling of Nonserial Linear 30+ refereed journal papers. His research
Projects, American Society of Civil interest includes cost-schedule integration, Technical Articles - Each month, Cost
Engineers, ASCE-Journal of environmental assessment of construction Engineering journal publishes one or more peer-
reviewed technical articles. These articles go
Computing in Civil Engineering, materials, solid waste as construction through a blind peer review evaluation prior to
Vol. 10, No. 2, (1996): pp. 106-114. materials, expert systems, neural networks, publication. Experts in the subject area judge the
11. Soh C.K., K.W. Phang, and W.P. and robotic applications in construction. technical accuracy of the articles. They advise the
Wong. An Integrated Intelligent System Dr. Eldin enjoyed 15 years in the authors on the strengths and weaknesses of their
submissions and what changes can be made to
for Scheduling Construction Projects, construction industry and served recently improve the article.
ICE Journal of Civil Engineering, as a project manger on power generation
97(4), papers no 10067, (1993): pp projects totaling over $250 million. His
156-162, UK. experience involved engineering design,
procurement, and construction. His years
in the industry necessitated his work in:
ABOUT THE AUTHOR North America, Europe, Asia, and Africa.
This unique exposure to multi-cultures
Dr. Neil N. Eldin, PE, has over 30 years of enriched his life at professional and
professional experience involving teaching, personal level.
research, professional service and industrial Dr. Eldin is a licensed Professional
experience in the construction engineering Engineer (PE), CPC and OSHA trainer.
and management field. During his 15 He has served actively in many professional
years in academia he taught the more organizations: ASCE, AACE International,
challenging engineering and management CII, and CSI. Dr. Eldin is the director of
courses. He received The-Teacher-of-The-
Proposed AACE International Constitution and Bylaws Amendment

Mechanics of Conducting Elections amended by letter ballot as prescribed in the Bylaws.”
• Remove the wording “shall be mailed” from ARTICLE
Recommendation II—NOMINATION AND ELECTION OF OFFICERS
The AACE International Board of Directors recommends AND DIRECTORS, Section 3, and replace it with, “Shall
a vote “for” the following changes to the Association’s be distributed”
Constitution and Bylaws. • Section 5—Amends the wording from “Election of
Officers and Directors shall be by sealed letter ballot” to
Background “Election of Officers and Directors shall be by ballot as
The current AACE International Constitution and Bylaws prescribed by the Board of Directors.”
provisions for the Election of Officers and Directors calls for • Section 7—Removes the word “unopened.” The section
the use of “sealed letter ballots.” As technology advances, more currently reads, “Three months prior to the Annual
efficient ways of conducting elections become available. Meeting, the Vice President-Administration shall deliver to
Recognizing that the continued use of sealed letter ballots the tellers, unopened, all ballots received.” If amended, it
is cumbersome, slow, and requires considerable staff time and will read: “No later than three months prior to the Annual
expense, the board is recommending adoption of an amend- Meeting, the Vice President-Administration shall deliver to
ment removing the requirement for use of “sealed letter bal- the tellers, all ballots received.”
lots” and authorizing instead for the Board of Directors to be • ARTICLE XI—PROCEDURE FOR AMENDING THE
given authority to approve alternate means of conducting CONSTITUTION AND BYLAWS,
Association elections. • Section 5—removes the words, “shall mail” and changes
these to, “shall distribute.”
Approval of This Proposed Amendment Would: • Section 6—removes the words, “are mailed” and changes
to, “are sent.”
• Remove the word “letter” from ARTICLE XI—AMEND-
MENTS, Section 1. “The Constitution and Bylaws may be

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MARCH 31, 2005

EExecutive Ar ticle
xecutive Article
Patricia Eryes
Avoiding Successful Lawsuits by Non-Performing Employees

t is a frustrating fact that even poorly performing employees often It is important to avoid overly broad statements such as, does rou-
I
•
win lawsuits for discrimination or wrongful termination. They often
make the following claims.
I didn't know what was expected of me;
tine clerical work, which may, in the case of a clerk, describe the entire
job. Statements of overall responsibility do not give enough help in
defining a job. In general, statements with words such as supervises, coor-
dinates, or directs probably describe overall responsibilities rather than
• I didn't know that I wasn't meeting job standards; or
tasks.
• I didn't know this awful thing (termination, demotion etc.) could
Overly narrow statements should also be avoided. For example,
happen to me.
"places correspondence in file folders," is only a sub-task of the major
How can an employee who is dismissed for sub-par performance task "maintains correspondence files."
win such a lawsuit? Often, it is because the supervisor failed to commu- Relatively minor tasks should be omitted. Remember that what is a
nicate in a clear manner, or at all, exactly what job standards applied and major task for one employee may be a minor task to another employee.
what the particular employee needed to do to meet those standards. For example, the maintenance of correspondence files, while a signifi-
Equality of opportunity isn't the same as equality of outcome. In the cant task for a clerk, is only a minor task for a civil engineer.
courtroom, the dismissed employee doesn't have the burden to prove he For ease in rating, most jobs should be described in terms of four to
would have succeeded; but rather, simply that he wasn't given an equal eight major tasks.
opportunity to succeed.
Standards Should Apply to Specific, Significant Tasks of the Position
Many managers and supervisors are terrified of the performance
If the employee's responsibilities are expressed in vague, general
appraisal process. It is difficult to convey bad news to an employee who
language, it will be difficult, perhaps impossible, to write clear, mean-
is likeable and trying hard, but just isn't meeting performance expecta-
ingful standards for the job. Wherever possible, tasks should be expressed
tions. It can be even more difficult to provide criticism to an employee
in
who is neither likeable nor demonstrating a positive attitude, because the
concrete terms that describe definite actions that the employee takes.
leader fears a defensive reaction. Still, the most frequent reason for inef-
Also, standards should normally not be written for temporary or unusual
fective or non-existent performance appraisals is the absence of specific,
responsibilities or minor tasks, since this would make the standards too
measurable standards with which to perform a viable evaluation. This
long and complicated, as well as difficult to communicate and adminis-
creates business inefficiencies and very real legal risks.
ter.
Appraising employee performance with reference to a set of written
standards, which mirror the job descriptions, is a valuable approach. Every Task Should Have One or More Performance Standards by
Standards-based appraisals are an especially effective way to document Which Accomplishment of the Task can be Judged
that employment decisions, such as decisions to terminate employment, Standards should specify what level of performance is expected in
withhold pay increases, or promote one employee over another, were relation to a given task, that is, what the employee is expected to do and
made fairly and without illegal prejudice. how well he or she is expected to do it. Performance standards should
Objective standards, communicated clearly and consistently to serve as benchmarks that tell the HR professional and employee when
employees, are critical. Employees should understand clearly what is and under what conditions the employee's performance of the task is sat-
expected of them. Clear standards have the following attributes: isfactory. "Satisfactory" means a "good" level of performance, reflecting
what an employee in that job can normally be expected to do.
Every Position Should Have Performance Standards
To say that written standards cannot be prepared for a position is to Standards Should Reflect a Fully Acceptable or a Satisfactory Level of
say that the supervisor does not know what to expect of an employee and Performance
that the employee's work cannot be objectively evaluated. Standards should be attainable and should reflect what is expected
of a fully trained and competent employee. Standards must be high
Standards Should Cover Specific Positions, Not Broad Classes of
enough for the work unit to accomplish its objectives and low enough for
Positions
competent employees to reach them.
Even though certain employees may have the same job title, differ-
ent standards should apply for these employees if significant differences Standards Should be Expressed Precisely
in operating practices or working conditions exist. For example, a clerk The more precisely standards are stated, the easier it will be to eval-
typist in accounting and one in public relations would perform different uate performance and give employees guidance on what is expected of
work, probably in different quantities. Only when the duties and working them. For example, "Responds to requests for estimates in accordance
conditions of positions are identical should a single set of standards apply with established deadlines" is not as precise as, "Responds to requests for
to them. estimates within two days of receiving a request." Vague or general words
or phrases, such as reasonable, seldom, or rapidly, should be replaced
Task/Responsibility Statements Need to be Written or Reviewed
with more precise terms whenever possible.
Before Standards Can Be Written So That Standards Can Be Set For
Each Task About the Author
A task is a major unit of work or significant component of the job. Patricia S. Eyres is an experienced attorney, with over 18 years defend-
The task statement should be broad enough to serve as a significant tool ing businesses in the courtroom. She is a full time professional speaker and
for evaluating an employee's performance, but not so broad that it author. Her most popular presentation is, "Leading Within Legal Limits™.
becomes burdensome or impossible to develop standards for the task. She can be reached at www.PreventLitigation.com or at 1-800-LIT-MGMT

T ECHNICAL A RTICLE
The ROICC is the sole entity manag-
The Case of US Projects in Europe ing on behalf of the owner and directly
interfacing with contractor organizations.
Guidelines to Mitigate Schedule The project environment is international,
with participants coming from different
Delay, from the Owner’s Viewpoint countries. Attention has to be given to
maintaining good relationships between
those involved as there are different cultur-
Massimoluigi Casinelli, PE CCE al, religious, and professional educational
backgrounds included in the mix.
ABSTRACT: This study analyses the problem of schedule delay on US government construction
projects in Italy. Similar problems, regarding US construction projects in Europe, have been
Structure and Role of the Contract
reported in literature [5]. This analysis was undertaken from the owner’s point of view. The pur-
pose of this article is to identify corrective actions that could be implemented by the owner. The role of the main contract is criti-
Experience shows that many projects suffer schedule delay and that this delay mostly cal, as it rules and governs the entire proj-
occurs during the "initial phase" of the projects, covering a period from five to seven months ect management process. Through coordi-
from contract award. For a typical construction project of a new facility, the "initial phase" of nation procedures, one needs to address
project start up (preliminary activities) includes the structural system erection (foundations, and regulate the communication between
structures erection, slabs). Schedule delay can also accumulate at the end of the structural the contractor and the owner. These proce-
erection. This can become a great portion of the final project schedule delay. Difficulties in dures can include the following.
maintaining the schedule from the early stages of project development create the basis for future
problems that will also cause further schedule delay. The contractor is then called upon to
• a submittals procedure for a material
prepare aggressive recovery schedules. These have a high probability to fail for a combination
of factors,that will be discussed in this article. and equipment procurement process;
This study analyzes factors causing schedule delays and suggests guidelines that, in the • quality assurance and quality control;
opinion of the author, could mitigate the problems of schedule delays and improve the control • a progress payment procedure; and
of schedules for similar US government projects in Europe. • planning and scheduling, including
The guidelines are based on a key concept of a different role for the owner who becomes schedule delay analysis and change
an agent of project management development. The owner then drives the contractor to make order management.
strategic choices at the earliest stage of project development. This is done by driving the
contractor to implement effective methodologies and techniques of project planning and The planning and scheduling contract
control. These actions require a different approach to bidding strategy. Although this article has
specifications (P&S-CS), Section 01321 of
been developed on specific cases of US government project in Europe, many considerations
have a general application for project management. the main contract, form the base on which
the project control system stands. These
KEY WORDS: Contracts, critical path, schedule delay address the entire planning and scheduling
process and project progress monitoring.
chedule delays and cost overruns The analysis presented in this article
S are a matter of concern for the

owner, as well as for the contractor.
The problems refer to project delivery
proceeds through three steps—a descrip-
tion of problems, analysis of the causes,
and a presentation of recommended
In looking at planning and scheduling
and project progress monitoring, consider
the following items.
methods, with special attention to interna- actions.
tional projects and bidding strategies.
• a baseline schedule development and
Managing projects overseas, in an interna- ANALYSIS
approval;
tional environment, requires a different
• a periodic schedule update (on a bi-
approach to tender and select the contrac- Description of the problems
weekly and monthly basis);
tor. Surely, it's necessary to break from the
• reporting;
low-bid paradigm [5] and promote instead The Projects Environment
• a schedule delay analysis procedure.
a criteria based on a best-value bid. The projects are generally assigned on
The Network Analysis System (NAS) is
This study is based on the field experi- the basis of a design-bid-build scheme
based on the critical path method
ences of the author. Since 1997, the author (DBB) [7]. The owner’s construction man-
(CPM) methodology, by using the
has worked as a project control consultant agement team is located on the project site.
predecessor diagram method (PDM)
on behalf of general contractors, on many The management role is undertaken by
technique [1]. The schedule delay is
projects regarding the construction of US residence officer in charge of construction
numerically expressed by the negative
Navy civil facilities in Italy, at the bases of (ROICC). Generally, the design firm is
total float on the current schedule
Aviano (Pordenone, Northern Italy) and located in the US and sometimes a part-
update. The schedule control and
Capodichino (Naples), Southern Italy. nering local engineering firm is engaged to
project progress monitoring is made
The author, with his group of planners provide local engineering support. This is
on the basis of current schedule versus
and schedulers, worked on over 15 build- mostly targeted to submittal analysis and/or
baseline schedule, showing current
ings, including administration buildings, technical change evaluations. Contractors
early/late dates versus target early/late
air passenger terminals, schools, and other are generally selected on the basis of a low-
dates.; and
typical civil facilities. bid process.

New Facility Project
Project Start Up
Preliminary Administrative Activities
Activity Total Activity Total
Description Float Description Float
Certificate of Insurance 0 Environmental Protection Plan: preparation 10

Issue Certificate of Insurance 0 Asbestos Hazard Abatement Plan: Approval 10
Surety Bonds 0 Temporary site facilities plan: preparation 10
Issue Surety Bonds 0 Asbestos Hazard Abatement Plan: Preparation 11
02468 - Drilled Found. Plan: Requirement 0 01321N - Network Analysis Schedule: 12
1.4.2 - Pile Installation Plan: Submit. Prep. 0 01330 - Submittal Register: approval 13
1.4.4 - Survey of Pile Locations: Submit. Prep. 0 List of Proposed Subcontractors: approval 14
2.1.1.3 - Reinforcing Steel: Submittal Prep. 0 List of Proposed Product: approval 14
02468 - Drilled Foundation Plan: approv. gover. 0 List of Proposed Subcontractors: preparation 15
02468 - Drilled Foundation Plan: 0 List of Proposed Product: preparation 15
Purchase./Delivery Process Demolition Plan: approval 15
03300 - Cast in Place Concrete: requirement 4 Demotion Plan: Preparation 16
1.6.2.1 - Formwork: sub. prep. 4 Erosion and Sediment Control Plan: approval 20
1.6.2.2 - Reinforcing Steel: Submittal Prep. 4 Erosion and Sediment Control Plan: submittal 21
1.6.4.1 - Concrete Mix Design: Subm. Prepar. 4 Pre-construction conference 30
2.1.3 - Joint Sealants: Subm. Prepar. 4 Preliminary Construction activities
2.1.11 - Welded Wire Fabric: Subm. Prep. 4 Commissioning Scope Meeting 0
2.1.12 - Polypropylene Forms: Subm. Prep. 4 Temporary External Sewerage Line 4
2.4.1.2 - Mix Design: Subm. Prep. 4 Temporary External Water Line 4
2.5.1.1 - Fly Ash: Submittal Preparation 4 Temporary Electrical Line 4
2.5.10 - Joint Sealants: Subm. Prep. 4 Temporary Grounding System 4
03300 - Cast in Place Concrete: approval 4 Notification & Communication ISPESEL 4
01330 - Submittal Register: preparation 5 Tower Crane: Excavation Foundation 4
Hazardous removal material: subcontr. 5 Tower Crane: Concrete Foundation 4
03300 - Cast in Place Concrete: Pur./Del. P. 5 Tower Crane: Assembly 4
02315 - Excavation & Fill: Requirement 5 Tower Crane: Electrical Connection 4
02315 - Excavation & Fill: Submittal 5 Tower Crane: Grounding Connection 4
02315 - Excavation & Fil: Approval by 5 Tower Crane: Notification ASL 4
01321N - Network Analysis Schedule: final 6 Pre construction completion: START 4
02315 - Excavation & Fill: Mobilization 6 Asbestos Removal 7
Excavation Plan: preparation 8 Asbestos Free Area Certification (ASL) 7
Excavation Plan: approval 8 Remove Pavement and Concrete Paver 7
Health & Safety plan: preparation 8 Remove Underground Utilities 7
Health & Safety plan: approval 8 Staking Building 8
01450 - Quality Control Plan Preparation 8 Connections with Site Office 8
01450 - Quality Control Plan Approval 8 UP TO GRADE LEVEL
01321N - Network Analysis Schedule: review 8 Structural Works
01572 - Waste Management Plan: approval 9 Installation Pilot Test Pile 0
Schedule of Value: approval 9 Excavation 4
Work Plan: approval 9 Geo-radar Investigation 8
Environmental Protection Plan: approval 9 COMMISSIONING & TEST RUN
Temporary site facilities plan: approval 9 Mechanical Works
01572 - Waste Management Plan: preparation 10 Submit TABS Agency qualification 22
Schedule of Value: preparation 10 Agency approval 22
Work Plan: preparation 10
Table 1— List of Project Start Up Activities

• a time impact analysis (TIA) proce- stage of the project. Unfortunately, these develop tentative recovery schedules based
dure for dealing with change analysis schedules are destined to failure, leading to on the overlapping of future activities.
and evaluation. a deterioration of relationships among the These include mechanical and electrical
parties. Also, tentative recovery schedules installation, and interior finishes that are
Although the P&S-CS are designed on create a basis of future schedule delays. characterized by a soft logic [3].
the owner's needs, they also can support The effect of this practice (that should
the contractor's project control and con- The Sequences of Works: Hard Versus not be encouraged by the owner) is to
tract management. Soft Logic remand to the future the solution of cur-
The critical point in developing joint Typical activities of the initial phase rent schedule delay. This creates the basis
support is the capacity of the contractor to are: for further schedule delays in the next
understand the above implications and the stages of project execution. This is because
potential advantages. In any case, the role • the preparation and issuing of key pre- of the impracticability of the developed
of P&S-CS is critical. Effective specifica- liminary documents (quality control, plans. In fact, the overlapping of future
tions, tailored to the specific project's com- safety plans, etc.) activities leads to other negative effects,
plexity, are a major issue that the owner • the preparation and issuing of critical including the following.
should address [7]. submittals affecting the start of the
works; • the works scheduled require more
Analysis of Schedule Delay and Effects • the execution of the preliminary con- labor force than what was originally
on Project Environment struction works (removing of haz- planned. The subcontractor is called
Experience gained on prior projects ardous material, site preparation, upon to increase staffing and/or plan
has shown that many of these projects suf- underground external utilities, etc.); to work overtime;
fered from serious schedule delays. In some • construction of the structural systems: • the overlapping causes congestion in
cases, difficulties in executing a project at a excavations, foundations, steel / rein- the work areas;
required rate of progress caused serious forced concrete erection, slabs (up to • a great coordination effort is demand-
financial problems and the contractor grade level or the first floor slab). ed of the project staff of the main con-
ended up in bankruptcy [5]. tractor;
In these cases, schedule delay tends to A detailed list of the project start up • litigation grows among subcontractors
extend over a period of several months. A activities is given in table1, and is ordered and between subcontractors and the
new tender process must be undertaken. by total float. main contractor;
The owner suffers double cost from re-pro- The structural system erection ends • the main contractor is pushed to devel-
curement and from costs associated with a with the building being closed up. This is op even more aggressive schedules that
late delivery of the facility. achieved when the building’s roofing work increase the problems; and
In summary, the problems observed is completed. This milestone is critical for • the above factors are detrimental to
include the following. the further development of the works as it productivity and adjustment factors
allows work inside the buildings to start. should be considered to estimate the
• Projects progress at a slow rate, espe- This work will include installation of serv- duration of activities [4].
cially during the initial phase of the ices such as, fire protection, air ventilation
first five to seven months after the proj- and conditioning (HVAC); fire alarm, The tentative recovery schedules have
ect award. power and lighting, anti-intrusion, interior a high probability to fail and there is a risk
• A schedule delay occurs and grows finishes, etc. of aggravating the situation. The project
during the initial phase. This described sequence is the ideal could remain without a realistic schedule
• The tentative recovery schedules path of the construction works, on which a and the relationships between the owner
developed by the contractor are des- typical baseline schedule is developed. The and the contractor risks ruin. Although the
tined to fail and to create the basis of activities for preliminary construction and owner has the right to ask the contractor to
further schedule delays. structural system erection are characterized prepare a recovery schedule, and the con-
• Lack of control on the projects caused by sequences of works requiring the use of tractor has the right to have this chance, it's
by the absence of a realistic schedule hard logic for the development of the CPM evident that another approach should be
describing the actual situation; poor schedule [3]. The tight sequence of the investigated by analyzing the causes of the
communication between the contrac- construction works, the fixed duration of difficulties to start up the project.
tor and the owner because of the the activities (constrained in a small range
absence of a common reference and a of well known productivity), and the need The Causes of Schedule Delay
common language. for dead-time concrete curing, make it dif- The contract demands a fast imple-
ficult to recover the schedule delay during mentation of the project management
Experience has showed that schedule this stage of project development. process, especially in regard to the submit-
delays mostly occur during the initial Experience has confirmed that the tals approval process. Many preliminary
phase, relevant to project start up and delay accumulated during the construction activities stand on the critical and sub-criti-
structural system erection. The contractor of the structural system of the building is cal path (total float value between 0-10
is called upon by the owner to prepare and destined to remain, in large portion, un- days). The typical critical and sub-critical
develop recovery schedules from the early recovered. Hard logic obligates one to paths of construction of a new facility are

limited to the first 6-8 months, and are • poor experience on similar projects; Effects on Critical Issues/Activities
shown in figure 1. • a lack of managerial skills and project • late issue of key documents (a safety
The real causes of schedule delay dur- management culture, both at the man- plan, excavation plan, and a hazardous
ing the initial phase are related to the diffi- agement level and at the project level; material removal plan);
culties of the contractors to properly set up and • late issuing of critical electrical /
an organization tailored to the contract's • inadequate financial capacity. mechanical submittals;
requirements and to implement the right The effects caused by the above factors • an absence of efforts by key subcon-
process of project management. This is will now be further described, by correlat- tractors in the planning phase; and
because of the following critical factors. ing the impacts on specific activities caus- • late issuance of a baseline control
ing delay and/or a lack of schedule control. schedule or preparation of the baseline
• poor knowledge of the project (scope, schedule without the contribution and
technical specifications, project envi- Late Mobilization of Contractor consensus of major subcontractors.
ronment); • Set up of project organization.
• poor knowledge of the contract's • Selection and mobilization of key sub-
requirements; contractors.
Figure 1— Critical and Sub Critical Path (Limited to the First Six Months)

Poor Knowledge of the Contract's niques of project scope definition and plan- • The owner should impose the use of a
Requirements ning. WBS (work break down structure) and
• Undervaluation and misunderstand- of a CBS (cost break down structure),
ings of the procurement process, and Action 2 in order to get full integration among
coordination of the communication Improve the planning and scheduling the bid's cost estimate, the project
procedures, misunderstandings of activity of the contractor during the execu- budget, and the structure of project
technical specifications. tion of the works. planning and scheduling.
• The owner should develop a basic
Effects on Critical Issues/Activities Action 3 WBS—contractual WBS (CWBS).
• a bad cost/labor estimate; Adopt two types of contracts—reim- The contractor should be asked to
• a wrong estimate on procurement of bursable for the project management staff develop further details (i.e., the further
long time items; of the contractor (indirect cost) and lump levels of WBS). This can drive the con-
• under evaluation of the needs of sub- sum, fixed-price, for construction works tactor to give evidence of an under-
contractors coordination. (direct costs). standing of the scope of work.
• Create a temporary engineering task
Poor Project Management Culture Actions 1 and 2 must be translated in force. This should be based on site, at
• Poor project planning and control: specific contract's obligations, respectively a location provided by the owner to
scope definition, estimating, planning through instruction to bidders and through facilitate the early submittal process.
and scheduling methodologies. the integration of the P&S-CS. Action 3 This will facilitate contractor mobi-
could be limited to the most critical and lization to get the earliest approval of
Effects on Critical Issues/Activities important projects. critical key documents (quality control
• wrong approach in the process of plan, submittal register, baseline
schedule control; Practical Guidelines schedule, safety plan, foundations and
• abuse and/or wrong use of CPM Action 1—Organization and Planning shop DWGs. etc.) and key submittals
scheduling methodology; and This action has two goals: (concrete mix design, underground
• wrong implementation of planning utilities, piping, etc.). The use of a
and scheduling contract specifications • forcing the prospective contractor to web-based project control system
NAS (networking analysis systems). the earliest project planning (pre-plan- would facilitate the communication
ning) [1 and 6]; and among the parties.
Inadequate Financial Capacity • giving evidence of the clear under- • The bidder should address all the
• difficulties staffing the project with the standings of scope of work and of the above issues in the project plan.
right skills; and contract's requirements [3]. Specific details regarding the content
• difficulties funding the project; a and format of this key document
financial incapacity to sustain initial Practical Guidelines should be included in the instruction
cash flow obstructs the contractor in • Project key personnel presented by the to bidders.
the early procurement of materials and contractor must include the certified
equipment. engineers/architects in charge of the Action 2—Improving Planning and
submittals preparation; even and espe- Scheduling Specifications
Recommendations Proposed / Key Concepts cially if these activities shall be under- This action has two goals:
Control of the project construction taken by the subcontractors, as this is a
phase, from the owner’s point of view, starts widespread practice. • Facilitating and driving the contractor
during the tender phase. The goal is to lead • Selection of subcontractors: key sub- to undertake effective project planning
the contractor to an early set up of the proj- contractors must be selected by the (figure 2) at an early stage and the best
ect organization and to the most effective contractor during the bid time and development of the baseline project
project planning. The solutions proposed declared in the offer. This is critical schedule; and
(in the form of guidelines) are based on because the project startup requires • Improving schedule control with
three sets of corrective actions, that can be the early mobilization of specific sub- emphasis on the process of schedule
implemented independently; all of them contractors, as well as early submittals. update.
require a more active role of the owner who • The bid's project schedule must be
becomes the real engine for the develop- tied to the baseline project schedule Practical Guidelines
ment of the project management. through the front end schedule. This • Create a contractual WBS (CWBS) in
requires that the owner imposes a bid order to facilitate a common frame-
Action 1 schedule, including a detailed front- work among different projects within
The contractor should be driven and end schedule, covering the initial an owner's portfolio. Drive the con-
supported in order to anticipate some criti- phase of 90-120 days after contract tractor to set up an effective structure
cal choices regarding the project organiza- award. This must be used as a basis to to a multilevel schedule.
tion at the time of bidding preparation and develop the project baseline schedule. • Create a multilevel schedule: master
to implement the best practices and tech- The front-end schedule must contain schedule, summary, and detail sched-
all critical preliminary activities. ule.

• Schedule control: the process should
be improved in regard to the proce-
dures for schedule updating.
Action 3—Different Contract

Arrangement
This action has the goal to guarantee
that the contractor selects skill resources
and sets up a project management team fit-
ting the project's needs.
The analysis presented in this article
has pointed out the importance of the con-
tactor's capability and competence. A dif-
ferent bid strategy, based on the scheme of
best value of the offer rather than based on
the paradigm of low-bid, should surely
Figure 2— Project Planning Process
facilitate the delivering on time of the most
important projects. A different and inter-tractor. The final goal is to drive the con- interior finishes). The paradox is that after
mediate solution to be explored, could be tractor to early project planning, providing experiencing troubles and being pushed by
based on two different arrangements of theguidance and means for the most effective the owner, the contractor finally realizes
contract for the same project. implementation of project management the need to properly staff the project team.
methodologies [6]. Regrettably, this generally happens at too
• Reimbursable for the project staff of Three sets of actions have been pro- late a stage for project success.
the contractor; and posed regarding the bid stage and the proj- The situations described may happen
• Lump-sum for the construction works. ect execution stage respectively. at different levels of awareness of the con-
tractor's top management, depending on
This solution would lead to two main • Driving and supporting the contractor the culture of the firm and its experience
advantages: on similar projects. Regardless of the grade
to do early project planning, by forcing
• To allow the owner to verify and con- management to anticipate some criti- of awareness of the contractor's top man-
trol. After the bidding stage, the staff cal choices at the bidding stage. agement—the effects of the above factors
contractor mobilizes to manage the • Improving the planning and schedul- on a project are often disastrous.
project. Letting the owner know that ing of contractual specifications. In many cases, the author has observed
the selected personnel have the right • Arranging two types of contracts for a real and honest effort by the contractor to
skills and competencies to do the major projects: reimbursable for the properly plan and organize the works.
work. contractors project staff and lump sumHowever, failure was because of a lack of
• To guarantee the early set up of project for the construction works. project management practices.
organization, this is critical to proper In other cases, the project was awarded
start up the project. The proposed guidelines require on the basis of an unrealistic cost estimate
translation into the contract's language. and the project manager was forced by top
Summary of Key Concepts The instructions to bidders and P&S-CS management to perform the work with lim-
The absence of a structured and com- are the tools to implement the recom- ited resources, inadequate to the project
prehensive project planning procedure mended actions. objectives. In this case, the contractor may
from the early stage of a project (front-end need to be terminated. In other cases, the
planning) can lead the contractor to under- Final Considerations project staff had the right skills and experi-
value both the scope of works and the con- A few wrong managerial choices may ence, but top management and project
tract requirements. A lack of project skills, generate many negative impacts (Pareto’s managers imposed the wrong strategic
poor knowledge of project management law), detrimental for the success of the choices. ◆
methodologies and practices are limits to project.
better performances. The critical factors, as described in this REFERENCES
To facilitate project start up, so critical article, lead to a general under valuation of
for success, the owner should force and project’s needs. Consequently, the organi- 1. AACE International’s Certification
drive the contractor to make some critical zation set up by the contractor may be Study Guide (2nd ed. Revised: 2002)
choices during the study and preparation of inadequate, both in terms of people and/or (chapter six: Productivity Adjustment)
the bid. skills mobilized. (chapter eleven: Planning and
The owner should integrate his role, Organizational set up requires early Scheduling)
becoming an agent of project management mobilization of key subcontractors. They 2. AACE International’s Professional
development. The can be accomplished by will be in charge of handling all submittals Practice Guide to Project Delivery
playing a more active role, targeted at pro- from their specific disciplines— (structural Methods. Douglas D. Gransberg, PE
viding methodological support to the con- system, mechanical, electrical, and civil CCE, and Keith Molenaar. (2001).

3. AACE International’s Skills and knowledge of Cost
Engineering 4th Ed. Chapter 9 Scheduling Techniques,
(2002): page 9-2 and 9-3).
4. Ballast, Leaf A., PE, and Dr. Calin M. Popescu. Selecting
Planning and Scheduling Specifications. AACE International
Transactions, 2001.
5. Gransberg, Dr. Douglas D., PE, and Michael A. Ellicott, PE.
Best Value Contracting: Breaking the Low-Bid Paradigm.
AACE International Transactions, (1996).
6. Rahbar, Dr. Faramarz Fred and Dr. James E. Rowings Jr., PE
CCE. Top-Down Back-To-Front Project Planning. AACE
International Transactions (1998).
7. Tenah, Dr. Kwaku A. Project Delivery Systems for
Construction: An Overview; Cost Engineering 43, No. 1
(January 2001).
ABOUT THE AUTHOR
Massimoluigi Casinelli is an Italian citizen living and work-

ing in Italy. He is a project management consultant with Casinelli
Associates. He can be contacted by sending e-mail to:
[email protected].

T ECHNICAL A RTICLE
plan calls for a chilling tower building, but
it is not shown in the baseline schedule.
Construction Baseline Schedule The chilling tower building is a required
major structure that should be shown in
Review and Submittal Timeframe the baseline schedule. Omissions of major
elements of work from the contract should
lead to rejection and should be identified
Dr. Win G. Li, PE CCE PSP and David J. Carter to the contractor for correction in the next
submittal.
ABSTRACT: The construction industry is typically a complex business that involves many parties,
agencies, and trades. In order to control and monitor the progress of a project, the resources and
Level of Detail
cash flow should be identified and planned well in advance of the start of construction. Project
schedules are a great tool for tracking projects in terms of resources (labor, equipment, materi-
The contract documents should
als), activity duration, and costs. A properly used project schedule can provide the necessary specify the level of detail required for the
information to help project managers act promptly for any schedule or cost overrun. baseline schedule. Usually, there is a
Consequently, adjustments to work durations, logic sequence, and resources are needed to bring section of the contract documents
the planned schedule back into compliance. A thoroughly planned and developed baseline describing schedule requirements. These
schedule can effectively assist management in tracking resources. In the event that the sched- may include activity codes, durations,
ule duration, logic, resource or budgeted cost requires modification, a well developed baseline budgets, total float, number of activities,
schedule will benefit greatly in the updates. In addition, the project schedule will be one of the and so on.
most critical elements in the review and/or approval of changes. The baseline schedule estab-
The activity code requirements should
lishes the foundation for both elements of cost and time, where by all progress is measured.
Therefore, the development and review of the baseline schedule should be carefully performed.
specify the incorporation of codes, such as
This article provides criteria and guidelines for reviewing a baseline schedule. The review cri- area, section, trade, uniform building code
teria are based on the procedures developed by a consulting firm and the authors' experience. inspector (UBCI) codes, etc., to allow the
It has been successfully applied in the construction industry. In addition, a renovated and sorting of information into usable reports.
improved baseline schedule submittal timeframe over the traditional method is introduced. Some projects set limitations on
activity duration and costs. For example,
KEY WORDS: Baseline schedule, budget, cashflow, distributed float, and calendar the maximum activity duration is required
to be less than 31 days, with the exceptions
ost construction projects require In addition, the approval of the of submittal and procurement activities.
M a baseline schedule to be
developed at the early stage of
the project for the purpose of tracking
baseline schedule is a sensitive issue which
can create turmoil among parties [1].
There are guidelines for reviewing the
The duration limitation provides a better
control and tracking of the project progress.
Also, the limitation on activity
progress and payments. baseline schedule that can be helpful to duration and cost can provide a better
Computerized project schedules are the owner and the contractor. prediction of the cash flow; especially on a
being increasingly used because they not large project where the owner needs to set
only track project progress, cost and Major Elements of Baseline Schedule aside cash for payments.
resource use, but also serve as a tool for Review The smaller the duration and budget
legal matters, such as claim analysis, and Major aspects for reviewing a baseline of an activity, the easier it is to assess its
the evaluation and defense of lawsuits. schedule include several steps. A schedule progress. Therefore, it is important for the
Baseline schedule development is review checklist is shown in table 1. The owner or owner's agents to include the
crucial to the success of any project. It procedures for reviewing a schedule are proper language and requirements in the
provides a great tool for project control. outlined in figure 1. contract documents for what is expected to
However, in cases where the project Scope of Services be included in the contractor's baseline
schedule is not used, the control of the The contract’s scope of services should schedule.
project and the ability to make timely be captured in the schedule. The scope of Although developing a more detail
corrections to maintain the schedule and work should be described in the contract schedule takes more time and effort up
cost are compromised. Most problems specifications and construction drawings. front than those with less detail, it will
regarding project schedules can be traced The schedule should be reviewed on a benefit both the owner and the contractor
to a few major areas. Some of the most summary level (major components, i.e., in the long run.
important areas include the following. bridges, stations, buildings, etc.) prior to a A detailed schedule provides a better
• the project schedule is not developed more time consuming and detailed review. forecast of the project and gives a much
by a well-trained scheduling If any major element of work is clearer picture of the work sequences. In
professional; missing, further review is not necessary. addition, if there is a dispute or a claim
• it is not collectively developed by the The owner simply rejects the schedule and during construction, the schedule will be a
parties associated with the project; and returns it to the contractor for correction great asset for resolving either issue.
• it is not thoroughly reviewed by the and re-submittal. Resolution can be based on a comparison
owner or owner's representative. It is a major deficiency if any part of of the approved baseline with the regularly
the scope is not included in the baseline updated schedules.
schedule. For example, a construction

Detailed breakdowns and activity From this statistical data, one can infer shows the overall sequence of the project,
history provide a basis of what activities are that the total rainfall depth in June is most especially the phasing.
impacted and by whom they are affected. likely 97.5 percent (two standard A detailed review of the relationship
This eliminates some of the ambiguity. deviations) higher than the monthly between predecessor and successor will
average. Therefore, calendar modification also need to be performed. However, if the
Timeline and Phasing is necessary for those activities which are project schedule has a large amount of
The baseline schedule needs to meet sensitive to weather for the month of June. activities, reviewing schedule logic in
the phasing and sequence requirements as A modified weather calendar designed detail can be time consuming.
specified in the contract documents. for task sensitive to weather which blocks In this case, after the schedule logic in
Generally, either time constraints or site out four Fridays in June, is shown in Figure the summary level is confirmed, spot
accessibility issues cause a project to be 2. checking of the detailed logic is suggested.
executed in phases. For example, a The use of calendars shall be carefully Usually, the owner or his or her
renovation project requires classrooms to planned and applied to activities to representative cannot afford to exhaustively
be renovated according to their physical minimize any mistakes which could cause review the logic for each activity because of
location. Each classroom is renovated in a scheduling error. One way of verifying budget and time limitations.
sequence and will be re-occupied upon the calendar used, is through sorting and
completion. grouping calendar activities. Constraint Use
Often one phase of a project cannot The project schedule needs to
begin until a preceding phase is Schedule Logic incorporate all the required completion
completed. This type of information The schedule logic of the activities dates specified in the contract documents.
should be clear in both the contract needs to be logical and reasonable. It can Although certain project scope work may
documents and the contractor's baseline initially be prepared in a large scale not be on the critical path, it will need to
schedule. (summary level) and then further detailed be completed by the contract due dates.
as required by the contract documents. This imposes constraints on these activities.
Schedule Calendar The overall large scale verification can All constraint dates contained in a
Calendars may be established on a be done by using the "cosmic view" of the contractor's baseline schedule should be
basis of five work days, seven work days, Primavera Project Planner. This view thoroughly reviewed for validity. Improper
monthly, quarterly, weekends, etc., in
accordance with the requirements of the
project.
Non-working days should be
identified, such as holidays and special
events. For certain types of work, such as
earthwork, a weather calendar can be used.
This will provide a better forecast of the
activity completion date than what a
traditional calendar would provide [2].
The activity duration is usually estimated
from using a historical database, similar
project, personal experience, and
judgment, or projection rates.
Because the weather situation is
unknown at the time of schedule
development, most schedules either ignore
rain issues or add a certain percentage to
duration for uncertainty.
In addition, determination of the
activity duration seldom takes into account
variances of monthly weather conditions.
For instance, the historical weather data in
Fort Lauderdale, Florida is shown in table
2.
The average precipitation in Fort
Lauderdale in June (recorded for 30 years
between 1961 to 1990) is 243.8 mm (9.6
inches), which is higher than the yearly
average of 128.1 mm (5 inches) with
standard deviation of 64.3 mm (2.5 inches)
[3].
Table 1— Schedule Review Check List

Rainfall Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
mm 56.3 71.1 68.6 83.8 167.6 243.8 167.6 172.7 193.0 160.0 99.1 53.3
Inches 2.2 2.8 2.7 3.3 6.6 9.6 6.6 6.8 7.6 6.3 3.9 2.1
Average: 128.1 mm (5 inches)
Standard Deviation: 63.4 mm (2.5 inches)
Table 2— Average Rainfall in Fort Lauderdale, Broward County, Florida
used of constraints can cause scheduling schedule to contain between 100 and 500 Especially, if it is a large project for which
errors. For instance, use of zero total float detail activities [5]. the owner needs to release some reserves to
constraint on activities can cause the fund it. If the projection is not accurate,
project schedule forecast to be unreliable. Cashflow Projection some interest will be lost.
Use of zero total float constraint may The owner needs to make cash The accuracy of the cashflow
artificially create critical paths. Figure 3 available for progress payments based on projection can be affected by the detail of
presents an example of zero total float used the cashflow. The contractor's cashflow the activity level and by the schedule
on one activity which affects the critical projection from the baseline schedule can sequence. A resource leveling and
path. impact the owner's financial plan. construction sequence adjustment can be
Referring to figure 3, activity PA02000
- demobilize at section M applies the zero
total float constraint, resulting in its
predecessor PA01140 - canopy roof - N/B
platform and other preceding activities
(such as "PA01130 - set pedestrian
overpass) becoming critical. The trace
logic for these activities is shown in figure
4. Therefore, the activities with zero total
float used should be evaluated and
analyzed for its validity.
Forecast Calculations
The project substantial completion,
project final completion, and milestones
need to be within the specified contract
due dates. Also, open-end activities need to
be identified and reviewed. Open ended
activities and activities with excessive total
float need to be tied to relevant activities or
to a proper end. This could be the last
finishing activity of a work area or to a trade
to reduce their total float.
Activity Duration and Budget Constraint

Some projects require activity duration
to be limited to certain days and the activity
budget limited to a certain amount. For
example, the maximum activity duration is
15 working days and the maximum activity
budget is $75,000 [4]. These criteria force
the schedule to be developed in greater
detail.
Certain exceptions should be allowed,
such as procurement activities and
installation of heavy equipment. Some
projects have a contract provision for a
minimum number of activities required for
the project schedule. For example, a
public school contract requires the project
Figure 1— Schedule Review Procedure

done in order to accommodate the owner's easily become critical with any delays on
financial capacity. the project.
After the contract is awarded, the
contractor needs to provide a schedule Who Owns the Floats?
within the time frame specified in the The activity float (total float) is an
contract documents. important element when dealing with legal
If the progress payment is based on the matters, such as change orders or claims.
earned value of the cost loaded schedule, When reviewing the baseline schedule,
the bid cost estimate will need to be reasonable activity floats are anticipated. If
reconciled with the schedule budget. The no float or low activity floats are planned
unit cost of each discipline/trade will need on third party work or owner's tasks (such
to be verified. Also, any appearance of a as owner's review), the intent of schedule
front-end cost loaded schedule must be preparation will need to be verified. The
looked into. ideal schedule is to have balanced floats
Mobilization costs can be claimed among the activities. Figure 2— Weather Calendar
during the early stages of a project.
Sometimes the owner will allow the
mobilization costs to be billed up front as a
benefit to the contractor's working capital.
However, the mobilization costs need to be
broken-down into as much detail as
possible in order to eliminate ambiguity
which can lead to payment disputes.
Project Critical Path

The baseline schedule needs to
identify the project critical path. A
reasonable critical path should be expected
based upon the project’s physical location
and characteristics.
The critical path needs to be distinctly
shown as the longest path in the project
schedule leading to completion.
If the construction critical path is
shown on non-construction activities, such
as procurement activities or owner review
activities, the critical path is debatable and
should be thoroughly reviewed to ensure
reasonableness. The true critical path Figure 3— Subnet of a Construction Schedule with Zero Total Float Used
needs to be identified in order to monitor
the actual construction progress.
Artificial Critical Paths Must be

Prevented
The contractor can intentionally
create several artificial critical paths for
potential change orders. If one of the
critical paths is delayed by the owner or its
representative, the contractor can make a
claim for a time extension and/or cost
compensation.
An artificial critical path can be
achieved through several means, such as
lengthening activity durations,
manipulating the logic links, or altering
the construction consequence.
Near critical paths with minimal float
should also be examined during the
baseline schedule review, as these can Figure 4— Logic Trace for Zero Total Float Constraint Used on Activity Demobilize at
Section M

There have been discussions on "who
owns the float?" [6]. Basically, there are
three types of float ownership: the owner,
the project, and proportional or
distributed.
The Owner Owns the Float

Some contracts are written to protect
the interest of the owner and have a
contract provision stating that the float
belongs to the owner. However, this
method does not aid the efforts toward the
contract’s main goal which is the
completion of the project. Shifting all risks
to the contractor is not equitable and it can Figure 5— Slab Installation
result in a dispute in court [7].
An example of a construction dispute project manager must coordinate all the contractor shall reasonably plan and
scenario is the following. As shown in subcontractors to avoid disputes which may perform his or her work with a float of 13
figure 5, the activity, install a concrete slab, cause delays. days.
had 10 days of total float, according to its
current schedule. Before the concrete slab Distributed Float (Proportional) Case 3
was poured, the owner requested changes The above two methods seem to be This is a complex construction
in mechanical system and the location of subjective and do not demonstrate any situation where several activity trades are
the electrical panel. This activity had to be level of fairness. The distributed float being executed simultaneously, as shown
suspended for nine days to allow for re- method can improve the negative effect of in figure 8. The distributed float method is
design and re-routing of electrical wires. these two methods and is defined as [4]: unrealistic in dealing with such a
The owner used the owner owns the DF = (AD/PD) x TF complicated work sequence. A local
float provision to defend his case. Where DF = Distributed Float analysis (predecessor and successor) should
However, the contractor contested that the for activity be done instead.
masonry subcontractor could not come AD = Activity Duration Based on the previous discussion,
because of a schedule conflict when the PD = Path Duration there is no absolute method to determine
wiring was completed. The subcontractor TF = Total Float the float entitlement for all situations.
resumed work five days after completion of Float entitlement depends on the
the wiring. The contractor was seeking a This method appears to be a fair complexity of the activity inter-
four day time extension and cost method. However, it may not be applicable relationships.
compensation. To many, it seems that the in a complex schedule. For this discussion, The following sequence should be
contractor's claim to is justifiable. consider the following examples. used.
Float Belongs to the Project Case 1 • Apply a distributed float method where
The second method declares that float As shown in figure 6, the total float for possible;
belongs to the project. This method could activities is as follows. Complete 70 percent • Use float as belonging to the project as
imply that whoever gets it first, has it. It design, owner review 30 percent design, the second option
can lead to the abuse of available float by 3rd party review 30 percent design, and • The owner owns the float method
way of under using of workers. One bridge inspections are 25, 33, 33, and 50 should be avoided.
scenario could be that a drywall percent respectively. These four activities
subcontractor starts work for one week and will be executed by four different parties. Baseline Schedule Submittal
then the electrical subcontractor comes in By using the distributed float method, the Usually the contract requires a
to do the wiring. The drywall float distributions are shown in figure 6. baseline schedule to be submitted 30 days
subcontractor postpones his work because This method demonstrates a fairly after the notice to proceed (NTP). The
of a tremendous workload from other jobs. reasonable float sharing among activities. owner will review the submitted baseline.
Since the drywall subcontractor has not It usually takes at least two weeks for
finished his job, the electrical Case 2 review. It may take more than one month
subcontractor is delayed. The project If the activity execution is in sequence, to attain a mutually acceptable schedule
manager presses the drywall subcontractor (i.e., finish to start relationship), the float between the contractor and the owner.
to complete his work because the electrical sharing is relatively easy to calculate. As The contractor expects to receive payment
subcontractor's work has been delayed by indicated in figure 7, case 2 shows the on the insurance, bond, mobilization, and
the unfinished drywall work. The drywall distributed floats for three activities. It work performed during the NTP within the
subcontractor uses an argument of shows that activity complete 70 percent baseline approval period. However, the
available schedule floats as an excuse. The design has an adjusted float of 13 days that contract documents usually specify that no

payment shall be released until the • A cost loaded schedule is required in Historical Data for Baseline Schedule
baseline schedule is approved by the the contract. The initial schedule Review
owner. shall be cost loaded. There are no specific statistics
Therefore, if the baseline schedule is regarding the approval of baseline
not approved, the reviewer, the project An example of an initial schedule is schedules, according to the authors'
manager, and the contractor will find presented in figure 10. The activities in research. However, based on the records of
themselves in a very stressful situation. For figure 10 for the first six months show their a construction consulting firm, normally
this reason, the baseline schedule may not activity durations to be less than one month 99 percent of the baseline schedules do not
be reviewed thoroughly and/or the review as required by the contract. The activities fully comply with contract documents in
comments may not be incorporated scheduled after the first six months, have the first submittal.
completely. At this point, all parties agree durations exceeding one month (22 In the second submittal,
to get the baseline schedule complete in workdays). Based on the project size and approximately 30 percent to 40 percent are
order to move forward with the project. project duration, the timeframe (six still rejected. In the third submittal, about
This is especially true, if the contractor has months) for the first zone of work and the five percent to 10 percent are rejected [8].
financial constraints. In order to eliminate maximum activity duration (30 days) in the One of the main factors affecting the
this glitch, a modified submittal time frame second zone can be adjusted. likelihood of getting an approved schedule
should be considered. is the use of an external scheduling
Figure 9 shows a schematic of the
schedule submittal. This method has the
following advantages for large complex
projects.
• The contractor has more time to

develop the baseline schedule and
does not need to be rushed to finish it.
• It will give a general idea of how the
schedule structure will be, so both
parties can agree upon up front.
• It provides general time frames and
the project milestone dates in the
initial submittal. The second
submittal only adds additional detailed
activities to meet the same milestone
dates.
• It will not hinder the contractor's
working capital because of payment
constraints from the baseline schedule
approval.
• It will provide a better working
relationship between the owner and
Figure 6— Distributed Float - Case 1
the contractor from the beginning of
the project.
The following are initial schedule
requirements used by a $300 million
construction project [4].
• The contractor shall prepare an initial

schedule within 30 days after contract
award.
• The initial schedule shall contain the
first six months of work in detail (first
zone).
• The work from the seventh month
forward can contain less detail;
however, the maximum activity
duration constraint is 90 days (second
zone).

consultant as opposed to in-house he importance of reviewing the been practiced in the construction
scheduling staff. Based on the authors' past
experience, contractors using external T baseline schedule has been
discussed. The major review steps
scheduling consultants will get schedule covered in this article may be of assistance
industry. It is the responsibility of all
parties involved to ensure that the progress
of construction toward the common goal of
approval faster than companies using in- and can serve as a guideline for future use. completing the project, within the allowed
house resources. This is because The ownership of total float is a time, is accomplished with a good faith
scheduling consultants (who do this type of debatable issue and several methods have attitude.
work on a full time basis) are specialized in
this field. They generally provide a better
quality schedule to meet the contract
requirements than in-house staff.
Baseline Schedule Acceptance

Based on the previous discussion, the
baseline schedule needs to be reviewed
completely by the owner within a
reasonable time frame.
Meetings among parties are
anticipated to be conducted to resolve
pending issues and disagreements.
Constant dialogs between the parties is
encouraged because the common goal is to
develop a comprehensive baseline.
Once all the contract requirements
and comments have been incorporated
into the baseline schedule, the owner can
accept it. It is important to mention that
some contracts require all the
subcontractors on the project to sign off on
the baseline schedule to ensure their
commitment to the scheduled dates.
Figure 9— Baseline Schedule Submittal Timeframe

Figure 10— Initial Schedule
The baseline schedule submittal time Document, Book II, Section 5.5, 31-32 information technology for construction.
frame is usually tight and stressful for all (2002). The major projects he has been involved
the parties involved. A two-step alternative 5. Miami Dade County Public School, are in the TRI-RAIL Double Tracking
baseline schedule submittal, initial Florida, (2004). Project, Miami-Dade Water Sewer
schedule and baseline schedule, has been 6. Fisk, E. R. Construction Project Improvement Program, and School Board
introduced in this article. This method Administration. Sixth Edition, (2000): projects in Broward and Miami-Dade
provides a more flexible time frame for 322-323. counties of Florida. He received his Ph.D.
submitting the final baseline schedule, 7. Householder, J. L., and H.E. Rutland. in civil engineering from the University of
without impeding the submittal of Who Owns Float? J. Constr. Engrg. Florida. He can be reached at
payment applications from the contractor and Mgmt.,ASCE, 116, 1, (1990):130- [email protected].
which can impact the contractor's cash 133.
flow. ◆ 8. PBS&J Construction Services. David J. Carter is a vice president of
Baseline Schedule Review Records. PBS&J, an employee-owned, US, multi-
REFERENCES (2001). service engineering firm with headquarters
in Miami, Florida. He currently serves as
1. Zafar, Z. Q., and Rasmussen, D. ABOUT THE AUTHORS the division manager for the South Florida
Baseline Schedule Approval. Cost Construction Services. During his 20 years
Engineering, 43, 8, (2001):41-43. Dr. Win G. Li, PE CCE PSP, is a sen- in the construction industry, he has served
2. McDonald, D. F., Jr. Weather and ior scheduling/cost engineer of PBS&J. He 12 years with PBS&J and eight years with
Impacts. Cost Engineering, 42, 5, has extensive experience in the project Bechtel. The majority of his experience has
(2000): 34-39. controls area, mainly on project planning been in the project controls arena, focusing
3. World Climate. Website at and scheduling, cost control, estimating, on project cost control, scheduling, project
http://www.worldclimate.com/ (2002). risk analysis, simulation and modeling, management, construction claims reviews
4. South Florida Rail Transit Authority, database development, document controls, and analysis, as well as serving as an expert
Segment 5 Project. Contract project management, and computer added for construction litigation support. In addi-

tion to the TRI-RAIL Double Tracking
Project, he has worked on multiple major
projects with PBS&J, including the
Call for Education Board Volunteers
Metromover Project and the Palmetto
Invest in your Organization's Future and help maintain your certification.
Expressway Improvement Program in
Miami, General Consultant to the Contribute your time and knowledge to a committee:
Florida's Turnpike, support to the con-
struction programs for Miami-Dade and
Broward County Public School systems, The Education Board need volunteers to assists in their programs.
and multiple other projects of varied sizes.
With Bechtel he worked on the Colstrip Globalization of Educational Materials:
Power Plant in Montana, and the Limerick As an International Organization - AACE International is trying to
Units 1 and 2 in Pennsylvania. He has an
meet the commitments of its members and recruiting of new mem-
architectural engineering degree from the
University of Colorado, and first received bers.
his CCE in 1994. He has also served in
various positions in the local AACE Five languages have been recommended for expansion and sharing of
International Section in Miami. He can educational resources.
be reached at [email protected].
If you would like the challenge of recommendations of text, profes-
sional manuals for the AACE International Bookstore and to assist in
arrangement of translation of programs for certification and addition-
al education materials:
Please contact Dr. Sean T. Regan, CCE at [email protected]
BOOKS AVAILABLE FOR REVIEW -

19th Annual Seminar
The following books are available for review. The first reader
to request a book will get to write a review about it for the
RISK ANALYSIS —
Cost Engineering journal. If you are interested, send an e- DECISIONS INVOLVING
mail to [email protected]. UNCERTAINTY
The Project Management Question and Answer Book,
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ISBN 0-8144-7164-2-1 S.A.I.T. Calgary, Alberta
Agile Project Management: How to Succeed in the The Chinook Calgary Section brings to you a “hands on”
Face of Changing Project Requirements, workshop on Risk Analysis. Participants will be introduced to
by Gary Chin, published published 2004, 230 pages. probability distributions and Monte-Carlo simulation and
With Chin’s detailed strategy, project professionals in any shown the application of these techniques to business risk
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ISBN 0-8144-7176-5

P rofessional S er vices D irector y

Index to AACE
Adver tisers International
Corporate
ARES Corporation, back cover
Sponsorship
Computer Guidance Corp., page 2
Program
Missing McDonough Bolyard Peck, page 10
out? PMA Consultants, page 4

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Call 410.584.1966 today Primavera Systems, Inc., inside cover
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These courses are available to start any time – These 10-week courses start on April 4, 2005:
An Applied Framework for Project Management • Leadership and Motivation for Construction Supervisors
Fundamental Skills and Knowledge of Cost Engineering • Problem Solving and Decision Making
Writing for Results
Handling Personal Interactions
• Construction Cost Awareness and Production Control
Working in Teams • Estimating and Bidding 1
Communicating on the Job
Presenting Ideas Learn more about these courses at:
Being an Effective Leader www.aacei.org/education/distancelearning
Finding the First Job
Finding the Next Job
Entrepreneurial Cost Engineer
Introduction to Construction Estimating Complete information on all courses can be accessed
at: w w w.aacei.org/education/distancelearning

TThe Bulletin
he AACE International Bulletin
Atlanta Section
Atlanta Section Vice-President Gary Odivilas, CCE, pre-
sented Georgia Tech graduate student Adam Fleming with the
2004 Atlanta Section Scholarship Award at the Georgia
Engineering Foundation (GEF) awards dinner in November
2004. Jan Hunt, GEF Resource Director, sent Albert Kwong
CCE, Atlanta Section President, a thank you letter thanking
Odivilas for his presentation of the award at the dinner and the
Atlanta Section for its continued interest and support of engi-
neering education. Also being recognized by GEF for their
involvement with the Scholarship Program are Atlanta Section
members Dave Cowan, CCC, and Michael Horwitz, CCE.
Submitted photo
Attendees at the Cascade Section’s December dinner meeting are shown
above observing the presentation of the speaker’s plaque by Cascade
President Rob Edgerton, at left, to Steve Watt, of Best (Timberline)
Software Corporation, at right.
Catawba Valley
The Catawba Valley Section is having a great year! The new
Board of Directors includes the following. President, Henri
LeGendre; Vice President, Don Johnson; Treasurer, Vince Pratt;
Secretary, Bob McCully; Director of Scholarships, Connley St.
Laurent; Director of Membership, Kenny Miller; and Director of
Certification, Chris Swanson. With Henri LeGendre leading the
way and with the support of the Board of Directors, the Section
has been educating its members and preparing them for certifi-
cation. Meetings for the year are planned on the following top-
Submitted photo ics: estimating, scheduling, life cycle cost, engineering cost man-
Atlanta Section Scholarship winner Adam Fleming is shown above left agement, value engineering, project management, cost analysis,
receiving his scholarship from Atlanta Section Vice-President Gary and earned value. Meetings are the second Tuesday of each
Odivilas, CCE, at right. month at the Lockwood Greene Building in Charlotte, NC. The
section is planning a fall fundraiser for its scholarship program.
Cascade Section
The December dinner meeting of the Cascade Section fea-
tured a presentation titled, "Are You Ready for the New CSI
Masterformat 2004?" The speaker was Steve Watt. Estimating
product director for Best (Timberline) Software Corporation. He
explained how MASTERFORMAT 2004 differs from the current
16 division format. Mr. Watt discussed how Timberline is plan-
ning to deal with industry concerns about making the transition,
and still maintain historic cost and productivity data. His pres-
entation was rated superbly by those present at this well attended
meeting.
The Cascade Section conducts its regularly scheduled din-
ner meetings on the second Thursday of the month through June
at the University Place in downtown Portland. The January meet-
ing featured a presentation on Portland's St. John's Suspension
Bridge Rehabilitation. The February meeting will be on Seattle's
Brightwater Tunnel Project. For further information, refer to our Submitted photo
Members of the Catawba Valley Section are shown above as they meet for
web site at www.aacei-cascade.org or contact our President, Rob
the Section’s December 2004 meeting at which Kenny Miller presented a
Edgerton at 503-423-3998 x 22119. program on engineering cost management.

The Section will be leading continuing education seminars in
order to raise the funds. Ken Humphreys has agreed to donate
his time for the seminar and the section is trying to partner with
a local university on this effort. Mr. Humphreys also donated a
copy of his new book and it was raffled off at the December meet-
ing.
Chinook-Calgary
January’s meeting of the Chinook-Calgary Section was yet
another successful presentation with 56 attendees. Jim Arnold,
vice president, development and project director, OPTI Canada,
presented an overview of the Long Lake Upgrader Project. The Submitted photo
Long Lake Project, a joint venture with Nexen, will be Canada’s Five members of the Houston Gulf Coast Section enjoy lunch after a morn-
first project to integrate in-situ bitumen recovery with the use of ing of participating in training in preparation for taking the CCC/CCE
the OrcrudeTM process. The Long lake Project is designed to pro- certification exam.
duce 72,000 bpd of bitumen and process it into 38° – 42° premi-
Submitted photo
um synthetic crude oil. The patented OrcrudeTM process that
OPTI Canada is using will allow the plant to operate self suffi- Dan Joyce, far left, one of the
ciently. The plant will produce its own fuel, hydrogen, electrici- Houston Gulf Coast Section’s
ty, etc., which will dramatically lower its operating costs. The newest CCC members, is
$3.5 billion dollar project is expected to be completed in 2007. employed with Mustang
Chinook-Calgary Section President Peter Ripley presented Engineering and provided space
Pal Bhathia with a certificate honoring his 25 years as a member for a fall 2004 certification
and thanked him for his service as Section President, Region 1 training and exam site for
Representative and V-P of Regions. Les Smith was also thanked Houston Gulf Coast members.
for his many years of service to Chinook-Calgary, including serv- At his right is Curt Springmeier
ing as President of the Section. of OTB Solutions, one of the
training instructors and exam
proctors. Both received certifi-
cates of appreciation from the
section.
Solutions conducted and proctored the certification exam. Five

section members participated in the teach/test training exam.
Activities were conducted at the Mustang Engineering confer-
ence room. The section provided breakfast snacks and lunches.
In 2004, the Houston Gulf Coast Section added nine certified
members, six qualified for CCC/CCE certification and three for
PSP certification. The five HGCS members found this training
and exam to be a positive experience. The training included real
life, hands-on, project management/controls scenarios. The con-
cepts, formulas, definitions, etc., came from the Skills &
Submitted photo
Knowledge Edition 5 and the Certification Study Guide, the
Jim Arnold, vice president, development and project director, OPTI two reference books that AACE International recommends as
Canada, is shown above left talking with Peter Ripley, Chinook-Calgary study guides for the certification exams.
Section President.
New Jersey Section
Genesee Valley Section
The Genesee Valley Section board unanimously approved a
recent motion to donate $1,000 to the tsunami relief effort. In his
motion to the board, Member Doug Leo said, “The engineering
and cost effort that is being considered to aid the affected nations
is going to be unprecedented. Aside from the obvious moral rea-
sons to donate, we as members of the largest cost engineering
professional society should be part of this humanitarian effort.”
The Section now puts out a challenge to all AACE International
sections to be generous with regards to the tsunami relief effort.
Submitted photo
Houston Gulf Coast Section
Iftikhar Madni, CCE, New Jersey Section President, above left, presents a
From Nov. 18-21, 2004, a four day certification training class certificate of recognition to Carlos Sison, above right, for his 25 years of
was offered for Houston Gulf Coast Section members. OTB service to AACE International.

The December meeting of the New Jersey Section was Dec.
13, 2004, at Cervantes of Spain Restaurant in Cranford, NJ. The
meeting was the annual guest night and holiday celebration for
the section, hosted by Alex Krokowski. The turnout was good,
with 20 attendees including friends and spouses of guests. Ifti Don’t Have a Local Section of
Madni, CCE, New Jersey Section President, presented a certifi-
cate of recognition to Carlos Sison for his 25 years of dedicated AACE International?
service to AACE International. Linda Mock, of Merrill Lynch,
was the presenter for the evening, speaking on the topic of finan-
cial planning.
Don’t Worry!
Visit AACE International’s
AACE International’s
Submitted photo
CyberSection provides
Debbie Dempsey, New Jersey Section Vice President, above left, presents a a meeting forum for
certificate of appreciation to Linda Mock, above right, for her presentation
on financial reporting. members without a
local section.
St. Louis Section
The St. Louis Section conducted its 2004 holiday celebra-
tion on Dec. 7, at Dave and Busters. Games, door prizes, good
food and great company made the celebration fun and it was
This internet-based
enjoyed by all who attended. ◆ section can be reached
by going to “Groups”
HOW TO SUBMIT SECTION NEWS TO THE
COST ENGINEERING JOURNAL at SBC Yahoo. Signing
All submissions should be e-mailed to [email protected]. up to the CyberSection involves getting a Yahoo
Information may be included in the body of the e-mail or as an
attachment. Microsoft Word files are the preferred format. ID, and then joining the group.
All photos should be sent as PC tiff or jpg files at 300 dpi. If
submitting at only 72 dpi, please send the photo as large as possible as
conversion will reduce its size. Include the names and titles of each
person shown in any photos. The SBC Yahoo service is free and allows AACE
Note on Section identification in submissions:
In the write ups submitted to AACE International for the Bulletin International to take advantage of current and
section of Cost Engineering journal, as well as in Section newsletters
and website articles, many times AACE International Sections are advancing online meeting technology.
referred to as chapters. The correct reference should always be to a
Section. AACE International does not have chapters. Please do not
Members may also view presentations from the
refer to Sections as chapters. group site and post messages. Be sure to stop by
Note on the listing of dates:
If an event is during the month of publication, it will be listed as the CyberSection and say hello!
an upcoming event even if members will not receive their journal in
the mail until after the listed event. The journal goes to press about a
month in advance of delivery, the issue date is always the first of each
month, and the electronic version should be posted by that date.
AACE International reserves the right to edit all submissions and aaceicybersection -
to refuse to publish any submissions determined by the editor or
executive director to not meet the standards of the journal. [email protected]
Anyone with questions on submitting copy or photos may contact
Managing Editor Marvin Gelhausen at [email protected], or
Graphic Designer/Editor Noah Kinderknecht at
[email protected].

A r ticle Reprints and Per missions
Cost Engineering Journal, Volume 47/Number 1, January 2005
Pages 8-10 Pages 21-36

Surviving the Perfect Storm The Case of US Projects in
Valerie Behrendt Europe — Guidelines to
This is the sixth in a series of monthly arti-
cles from Kildrummy, a global project cost Mitigate Schedule Delay, from
management solution provider. This white the Owner’s Viewpoint
paper series, Cost Management: Roadmap to Massimoluigi Casinelli, PE CCE
Project Success, was created especially for
Readers of the Cost Engineering With the objective of finding means to
AACE International. The articles deal with
journal can purchase copies of selected such topics as best practices, lessons learned, reduce project delivery time, a number of
articles that are published with an the benefits of in-house cost management schedule improvement methods (SIM) were
AACE International reference number expertise, standardization, and selecting the examined to determine their effectiveness in
at the end of the article. Articles can be right toolset for the job at hand. These issues schedule reduction. The researcher focused
and topics address AACE International's com- on means that lead to reduction of project
delivered in print form or in Adobe delivery time without increasing project overall
mitment to total cost management.
Acrobat (PDF) format. cost. As a result, all the cost-time trade-off
Please refer to the AACE Reprint 20958 methods (e.g., overtime, multiple-shifts, more
International reference number when costly crew mix, etc.) were excluded. Among
contacting our Publications Sales Pages 12-18 the promising SIMs were methods used to
department. The Effect of Early Freezing of achieve early freezing of project scope. Three
case studies were examined to determine the
Scope on Project Schedule implementation highlights, success factors and
To Order Dr. Neil N. Eldin, PE implementation barriers. The case studies
Contact: Nancy Merrifield, Administrator, With the objective of finding means to verified that measurable schedule reduction
Publications Sales at [email protected] reduce project delivery time, a number of could be realized by early freezing of project
schedule improvement methods (SIM) were scope.
Reprint Prices: examined to determine their effectiveness in Reprint 20960
Quantity Member/Non-Member schedule reduction. The researcher focused
1-9 copies $5.00/$7.50 on means that lead to reduction of project Pages 28-36
delivery time without increasing project overall
10-49 $4.50/$7.00
cost. As a result, all the cost-time trade-off
Construction Baseline
50-79 $4.00/$6.50 methods (e.g., overtime, multiple-shifts, more Schedule Review and
80-99 $3.50/$6.00 costly crew mix, etc.) were excluded. Among Submittal Timeframe
100-499 $3.00/$5.50 the promising SIMs were methods used to
Dr. Win G. Li, PE CCE PSP and David J.
achieve early freezing of project scope. Three
Carter
To Contact Us case studies were examined to determine the
implementation highlights, success factors and The construction industry is typically a
AACE International
implementation barriers. complex business that involves many parties,
209 Prairie Avenue, Suite 100 agencies, and trades. In order to control and
Reprint 20959
Morgantown, WV 26501 monitor the progress of a project, the resources
USA and cash flow should be identified and planned
Phone: 304.296.8444 well in advance of the start of construction.
Fax: 304.291.5728 Project schedules are a great tool for tracking
projects in terms of resources (labor,
equipment, materials), activity duration, and
For Information On Other Reuse costs. A properly used project schedule can
Requests provide the necessary information to help
If you are seeking permission to project managers act promptly for any schedule
copy, quote, or translate into another or cost overrun. Consequently, adjustments to
language any material from any issue of work durations, logic sequence, and resources
the Cost Engineering journal, please are needed to bring the planned schedule back
into compliance. A thoroughly planned and
contact our Managing Editor, Marvin
developed baseline schedule can effectively
Gelhausen at [email protected] assist management in tracking resources.
Reprint 20961

AACE I nternational B ookstore
w w w . a a c e i . o r g
Skills and Knowledge of Cost Engineering, 5th Ed scheduling, project management, and economic analysis and business
(available in paper or CD-ROM format) planning.
Scott J. Amos, Editor, 2004 4060-01CD-ROM
This updated and expanded guide for fundamentals is an excellent choice US$75.00member/US$115.00 nonmember
for anyone interested in a concise reference to all aspects of the profession.
The new 4th edition includes 27 chapters on estimating, manufacturing
AACE International Recommended Practices
and operating costs, scheduling, planning progress and cost control, and
much more. This is a very useful book for those studying for the Standard Cost Engineering Terminology; Cost Estimate
certification exam. 450 pages Classification System; Estimate Preparation Costs in the Process
Industries; Project Code of Accounts; Required Skills and
1545-01 paper version US$54.50 member/US$72.50 nonmember
Knowledge of a Cost Engineer; Roles and Duties of a Planning and
1545-02 CD-ROM US$54.50 member/US$72.50 nonmember Scheduling Engineer; Profitability Methods; plus many more.
4060-03 3-ring binder version
AACE International’s Certification Study Guide, 2nd Ed-Revised US$65.00 member/US$155.00 nonmember
(also available in CD-ROM format) 4060-05 CD-ROM
The AACE International Certification Study Guide provides an all- US$65.00 member/US$105.00 nonmember
encompassing reference text to prepare for the exam. The Certification
Study Guide provides background information on how to become certified;
gives those studying for the certification exam a single reference text that
includes theory, worked problems with answers, references, and a full
discussion of key topics; allows students to maximize their study time; and
provides a concise overview of the fundamentals of cost and project AACE International Transactions
management.
1820-32 paper version US$49.50 member/US$64.50 nonmember
2004
1820-33 CD-ROM US$49.50 member/US$64.50 nonmember
Transactions
5220-04 CD-ROM
Advanced Skills and Knowledge of Cost Engineering
US$74.95 member
1541-07 CD-ROM US$22.50 member/US$32.50 nonmember US$99.95 nonmember
3-ring binder version
Control and Management of Capital Projects, 2nd Ed US$165 member
John W. Hackney; Kenneth K. Humphreys, Editor, 1997 US$190 nonmember
AACE is pleased to sponsor this special soft-cover edition of this classic
reference for capital project management by the late John Hackney, as edited by
K.K. Humphreys. This second edition has 56 chapters that range from applied
theory such as Labor Productivity Analysis to practical concerns such as Selection This must-have reference contains presentations featured at the
and Management of Contracts and Contractor. 533 pages 2004 Annual Meeting in Washington D.C. The CD-ROM is
5185-01 paper version US$35.00 member/US$50.00 nonmember fully searchable.
5185-02 CD-ROM US$35.00 member/US$50.00 nonmember
2003 Transactions CD-ROM
AACE Salary and Demographic Survey of Project and Cost 5220-03 US$74.95 member/US$99.95 nonmember
Professionals 3-ring binder version US$165 member US$190 nonmember
1085-01 US$12.00 member/ US$18.00 nonmember
2002 Transactions CD-ROM
Cost Engineering 5220-02 US$74.95 member/US$99.95 nonmember
The international journal of cost estimation, cost/schedule 3-ring binder version US$165 member US$190 nonmember
control, project management, and total cost management. Issued
on a monthly basis, Cost Engineering has been published since 2001 Transactions CD-ROM
1958. Subscriptions are accepted on an annual basis. An 5220-01 US$74.95 member/US$99.95 nonmember
automatic benefit of AACE International membership, also 3-ring binder version US$165 member US$190 nonmember
available to nonmembers.
5060-07 US$65.00 (US)/US$82.00 (other countries)
1999-2000 Transactions (paper or CD-ROM)
Please add US$99.00 for airmail
US$64.95 member/US$89.95 nonmember - each
US$55 electronic subscription - see website for details
Cost Engineering CD-ROMs (1996,1997, 1998, 1999, 2000, 2001, 2002) 1998 Transactions
Each CD has a year’s worth of Cost Engineering and is fully searchable. 5220-98 US$59.95 member/US$84.95 nonmember
5060-02 US$38.50 member/US$48.50 nonmember
1993-1997 Transactions - special price!
Cost Engineers’ Notebook US$19.95 member/US$19.95 nonmember - each
This CD-ROM is an important reference for any project or cost professional. It includes data and
procedures related to basic skills and knowledge that all cost engineers should possess, extensive material
on capital and operating cost estimation, and papers in four subject areas: cost control, planning and
The AACE International Professional Practice Guides (PPGs)
PPG#1: Contracts and Claims, 3rd Ed. (PPGs) are a series of reference CDs that should be in every
James G. Zack Jr., Editor, 2004
Covers: Contract Administration; Management of project/cost management professional’s library. Each consists of
Construction Schedules; Schedule Control; selected Cost Engineering articles, AACE International
Schedule Float Ownership; Cost Control; Transaction papers, and other previously published documents
Management of Change; Cost Impacts; to which AACE has rights.
Productivity Impacts; Management and Analysis
of Delay; Concurrent Delay Issues; Pricing of
Delay; Mitigation of Claims; Documentation and and Quantity Surveying; Labor Costs; Equipment Management; International Project Delivery;
Claims Management; Claim Recognition and Costs; Subcontracting Costs; Overhead and Constructability; and Partnering.
Analysis; Claims Management; Negotiation Indirect Costs; Profit, Contingencies, and Mark- 4060-15 US$38.50 member
Process; Litigation and the Cost Engineer; and Ups; International Construction Costs; US$58.50 nonmember
Project Audits. Heavy/Highway; Specialty Projects; Scheduling
4060-06 US$53.50 member Input to the Estimate and Change Orders; PPG #11: Environmental Remediation
US$73.50 nonmember Bidding Decisions; and Computer Applications to Richard A. Selg, CCE, Editor, 2002
Construction Cost Estimating. Covers: Environmental Remediation; Planning
PPG#2: Risk and Scheduling Methodology; Cost Estimating;
Michael W. Curran, Editor, 1998 4060-11 US$38.50 member
US$58.50 nonmember Project Controls; Cost Modeling; Reporting;
Covers: Dictionary; Capital Investments; Cash Contingency Management; Risk Analysis
Flow; Competitive Bidding; Contingency PPG#7: Cost Engineering in the Utility Environmental Regulations; Benchmarking;
Analysis; Contracts; Cost Engineering; Currency Industries Economics of Environmental Waste Remediation
Rates; Decision Trees; Economic Analysis; David E. Hayes, Editor, 2000 and Waste Management; Cost-effective Waste
Escalation; Human Factors; Manufacturing; Covers: Auditing; Cost Estimating; Cost Minimization and Pollution Prevention; and
Marketing; Research & Development; Safety & Modeling; Cost/Schedule Control; Generation Construction Practices
Health; Schedule; Technological Risk; and Value Power Plant; Natural Gas Industry; Nuclear 4060-16 US$38.50 member
Engineering. Power Plant; Other Energy Related Topics; US$58.50 nonmember
4060-07 US$53.50 member Planning and Scheduling; Project Management;
US$73.50 nonmember Utility Rates; and Utility Property Valuation. PPG #12: Construction Project Controls
4060-12 US$38.50 member Douglas D. Gransberg, PE CCE, and James E.
PPG#3: Cost Engineering in Aerospace and Koch, Editors, 2002
Aviation US$58.50 nonmember
Covers: Introduction to Construction project
Sarwar A. Samad, Editor, 1998 PPG#8: Contingency Controls; Cost Control; Schedule Control;
Covers: Aerospace and Aviation. Kul B. Uppal, PE, Editor, 2001 Quality Control; Document Control; Computer
4060-08 US$38.50 member Covers: General Topics On Contingency; Applications; and International Project Controls
US$58.50 nonmember Cost Estimating and Contingency; Risk Analysis 4060-17 US$38.50 member
PPG#4: Planning and Scheduling and Contingency; and Other Related Topics. US$58.50 nonmember
Sarwar A. Samad, Editor, 1999 4060-13 US$38.50 member
US$58.50 nonmember PPG #13: Parametric and Conceptual
Covers: Planning; Scheduling Concepts and Estimating, 2nd Ed.
Techniques; Project Scheduling; Linear PPG#9: Decommissioning Costs Douglas W. Leo, CCC, Larry R. Dysert, CCC,
Scheduling; Probabilistic Scheduling; Resource Kin Chao, PE CCE, Editor, 2001 and Bruce Elliott, CCC, Editor, 2004
Scheduling; Delay Claims; Cost Scheduling; and Covers: Standardized Approach to Estimating Covers: Parametric/Conceptual Estimating;
Management Information Systems. Decommissioning Cost; Decontamination and Classification; Methodology; Capacity Factoring;
4060-09 US$38.50 member Decommissioning Estimating Approaches; Process and Non-Process Industries; and Systems
US$58.50 nonmember Development of Decontamination and 4060-18 US$38.50 member
PPG#5: Earned Value Decommissioning Cost Estimating Models; and US$58.50 nonmember
George R. Stumpf, Editor, 1999 Decontamination and Decommissioning
Estimating Issues and Challenges. PG #14: Business and Program Planning
Covers: Why Use Earned Value?; Basics of Randy R. Rapp, PE CCE, Editor, 2002
Earned Value; Cost/Schedule Control System 4060-14 US$38.50 member
US$58.50 nonmember Covers: Enterprise Management: General
Criteria; Actual Physical Percent Complete; Imperatives and Concerns; Strategic
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US$58.50 nonmember Covers: Design-Bid-Build (DBB) – DBB 4060-19 US$38.50 member
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Douglas D. Gransberg, Editor, 2000 Management; Construction Management (CM)
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C alendar of
C alendar of Events Events
February 2005 March 2005 20-23 The 49th Annual
CSI Show & Convention,
1-2 Measuring Customer Satisfaction - 6-10 18th Annual TUGIS 2005 The Construction
Best Practices for Developing and Conference, The Center for Geographic Specifications Institute, McCormick
Managing Essential Customer Information Sciences at Towson Place, Chicago, IL
Measurement Tools, California Institute University, Towson University’s
of Technology Industrial Relations Center, Department of Geography and Contact: www.thecsishow.com
California Institute of Technology Environmental Planning, Towson
Industrial Relations Center, Pasadena, University Campus, Towson, MD June 2005
CA
Contact: phone 410-704-3887 20-23 Ecobuild America the
Contact: phone 626-395-4045 fax 410-704-3888 Environmental Systems Technology
[email protected] Conference & Exhibition, Ecobuild
www.irc.caltech.edu 17-18 Deep Foundations: Design, America, Disney’s Coronado Springs
Construction, & Quality Control, The Resort, Orlando, FL
3-4 A/E/C Project Management American Society of Civil Engineers,
Bootcamp, PSMJ Resources, Inc., Sheraton Commander Hotel, Boston, MA Contact: www.ecobuildamerica.com
Sheraton Seattle Hotel and Towers,
Contact: www.asce.org 26-29 AACE International’s 49th
Seattle, WA
Annual Meeting, AACE International,
Contact: phone 800-537-PSMJ New Orleans, LA
fax 617-965-5152 23-24 GlobalCon, Energy, Power, and Contact: [email protected]
[email protected] Facility Management Strategies and www.aacei.org
www.psmj.com Technologies, The Association of Energy
Engineers (AEE), Atlantic City Convention
16-18 International Roofing Expo September 2005
Center, Atlantic City, NJ
2005, Hanley Wood Exhibitions and the 20-23 ISEC-03 - Third International
Contact: www.globalconevent.com
National Roofing Contractors’ Structural Engineering and Construction
Association (NRCA), Orange County Conference, Tokuyama College of
Convention Center, Orlando, FL
28-April 1 SPIE Defense & Security
Symposium, The International Society for Technology and ISEC, Tokuyama College
Contact: phone 800-684-5761 Optical Engineering, Gaylord Palms of Technology, Shunan, Japan
[email protected] Resort and Convention Center, Orlando Contact:www.tokuyama.ac.jp/english/ind
www.TheRoofingExpo.com (Kissimmee), FL ex.html
Contact: spie.org/events/dss
24-25 Energy Auditing 101: Identifying Editor’s Note: Please submit items for
Cost Saving Opportunities in Plants & future calendar listings at lease 60 days
Buildings, The Association of Energy April 2005
in advance of desired publication.
Engineers (AEE), Tropicana Resort, 3-7 Corrosion/2005 - NACE
Las Vegas, NV International’s 60th Annual Conference,
Contact: phone 770-925-9633 NACE International, George R. Brown
fax 770-381-9865 Convention Center, Houston, TX
www.aeecenter.org/seminars Contact: www.nace.org/c2005
20-26 Engineers Week, The National 5-7 7th Annual Conference & Exhibition
Engineers Week Foundation Electric Power 2005, The ELECTRIC
Contact: phone 703-684-2852 POWER Management and Program
www.eweek.org Committee, McCormick Place,
Chicago, IL
Contact: www.electricpowerexpo.com
AACE International, 209 Prairie Avenue, Suite 100, Morgantown, WV 26501 USA phone: 304-296-8444
fax: 304-291-5728 e-mail: [email protected] or [email protected] website: www.aacei.org

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February 2005

The AACE International Journal of

Promoting the Planning and

Cost Engineering Focus: IN

Puenta de la Unidad (Bridge of Unity) Wacker Drive Replacement

The Association for the Advancement of

Director-Region 6 COST ENGINEERING AACE International Headquarters

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 3

P 49th anniversary of the Western Winter Workshop. The

4 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

U preparations for our Annual Meeting in New Orleans,

A Note About Dues

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 5

Use the code "AACE Annual

NEED A REASON TO ATTEND

Try one of AACE's Top 10 Reasons!

10 - Alligators usually don't eat people

9 - It's the perfect excuse to tell your boss

8 - Suck the head off a crawfish -- earn

7 - Peer pressure...everyone else will be

6 - You can eat an entire year's worth of

5 - It's the perfect opportunity to stock up

4 - Take up a second language -- Cajun!

3 - You can audition for AACE Members

2 - Sheraton hotel soaps make nice gifts

1 - Come see the Voodoo that we do so

Surviving the Perfect Storm

ABOUT THIS ARTICLE

C with a challenging combination of factors that could

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Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 9

10 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

Primavera Launches New Synchronization Software for

I announced the release of Primavera® Contractor—the only

Easy Schedule Exchange

Fast, Professional Reporting

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 11

T capable of reducing project delivery

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Case-1 Case-2 Case-3

Table 2—Scope Summary of Case Studies

Case-1 Case-2 Case-3

Case-1 Case-2 Case-3

Table 4—Drivers for Implementation

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Employee Related Issues Management Related Issues Process Related Issues

Table 5—Description of Common Issues

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Issue Case-1 Case-2 Case-3 Frequency Weight (%)

1. Use of the latest technologies (3-D CAD, YES 1 33%

Table 6—Significance of Common Issues in Success Factors

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Table 7—Significance of Common Issues in Implementation Barriers

Examination of the detailed success

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Table 8—Significance of Lessons Learned

measured. In addition, each company ACKNOWLEDGEMENT International Journal of Cost

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 17

Proposed AACE International Constitution and Bylaws Amendment

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