Construction Management: Introduction To The Topic

Construction Management
Introduction to the Topic:
Construction and the ability to build things is one of the most ancient of human skills. In
prehistoric times, it was one of the talents that set Homo sapiens apart from other species.
Humans struggled to survive and sought shelter from the elements and the hostile
environment that surrounded them by building protective structures. Using natural
materials such as earth, stone, wood, and animal skins, humans were able to fabricate
housing that provided both shelter and a degree of protection.
Intended Learning Outcomes:
1. ) Discuss project development

2. ) Construction technology and construction management
3. ) Construction Industry
4. ) The bid package
Project Development
Construction projects develop in a clearly sequential or linear fashion. It generally
involves:
1. A need for a facility is identified by client

2. Initial feasibility and cost projections are developed.
3. The decision to proceed with conceptual design is made and a design professional is
retained.
4. The conceptual design and scope of work is developed to include an approximate
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estimate of cost.
5. The decision is made to proceed with the development of final design documents,
which fully define the project for purposes of construction.
6. Based on the final design documents, the project is advertised and proposals to
include quotations for construction of the work are solicited.
7. Based on proposals received, a constructor is selected and a notice to the constructor
to proceed with the work is given. The proposal and the acceptance of the proposal on
the part of the owner constitute the formation of a contract for the work.
8. The process of constructing the facility is initiated. Work is completed and the facility is
available for acceptance, occupancy and utilization.
9. In complex projects, a period of testing decides if the facility operates as designed and
planned. This period is typical of industrial projects and is referred to as project start-
up.
10. The facility operates and is maintained during a specified service life.
11. The facility is disposed of if appropriate or maintained in perpetuity.
The key players in this developmental sequence are:
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Construction Technology and Construction Management
As the name implies, construction technology relates to the methods or techniques used
to place the physical materials and elements of construction at the job site. Construction
management, in contrast, addresses how the resources available to the manager can be
best applied, we think of the four M's of construction typically when speaking of resources:
Manpower
Machines
Materials
Money
Construction management is resource driven. The job of a construction manager is to

efficiently and economically apply the required resources to realize a constructed facility of
acceptable quality within the time frame and budget.
Construction Industry
The construction industry has been one of the major factor that drives the economy.
Currently, only 34% of the present administration's flagship infrastructure projects are
being implemented, and 56% of the flagship infrastructure projects in the government's
revised list are expected to be completed by 2022.
End of Discussion.
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Reference:
Halpin, Daniel W. and Woodhead, Ronald W., Construction Management, 4th Edition,
Wiley, Hoboken, NJ, 2012.
For more references, kindly check TIP Online Resources
TIP Library (https://www.tip.edu.ph/library.html)
Proprietary Clause
Property of the Technological Institute of the Philippines (T.I.P.). No part of the

materials made and uploaded in this learning management system by T.I.P. may be
copied, photographed, printed, reproduced, shared, transmitted, translated or
reduced to any electronic medium or machine-readable form, in whole or in part,
without prior consent of T.I.P.
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Bid Package
Bids come in small and large packages; it depends on the type of service or project the
agency is looking for. The contents of the package will also depend on what needs to be
included in your proposal, based on laws and regulations. It’s important to understand all
of the details of a project in order to be sure that you can perform the work required and
comply with the contractual obligations for the life of the contract.
1. Preparing bid package
Project Concept and Need
The construction process can be best understood by examining the steps required to
realize a complete project.
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Each project has a life cycle triggered by the recognition of a need that can best be
addressed with the construction of a facility. In a complex society, the number of entities
generating needs that will shape the built environment is diverse. Private individuals seek
to construct housing that is functional and comfortable (e.g., home or residential
construction). Public entities such as city, state, and federal governments construct
buildings and required public structures to enhance the quality of life. Many public projects
relate to the development of the infrastructure. Bridges, tunnels, transportation facilities,
dikes, and dams are typical of public projects designed to meet the needs of a community
and the society in general.
Establishing Need
The first step in any project is the establishment of a need and a conceptual definition and
refinement of the facility that will meet that need. If the need has a commercial basis, it is
normally defined in terms of a market analysis that establishes the profitability of the
proposed project. Public and community-service-related projects do not typically involve
profit and, therefore, are triggered by other considerations.
Formal Need Evaluation
In deciding whether or not to proceed with preliminary and final design of a given project,
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three items should be developed during the conceptual portion of the project cycle. The
following elements provide input to the decision process:
Cost/benefit analysis
Graphical representation of the project
Cost estimate based on the conceptual-level information available.
These documents assist the key decision maker(s) in deciding whether to proceed with a
proposed project.
Conceptual Drawings and Estimates
In seeking funding for entrepreneurial projects such as hotels, apartment buildings and
complexes, shopping malls, and office structures, it is common practice to present
conceptual documentation to potential funding sources (e.g., banks and investors). In
addition to a cost/benefit analysis, graphical information to include architect’s renderings or
sketches as well as layout drawings, 3-D computer models and BIM assist the potential
investor in better understanding the project. For this reason, such concept drawings and
models are typically part of the conceptual design package. A cost estimate based on the
conceptual drawings and other design information (e.g., square footage of roof area, floor
space, and size of heating and air conditioning units) is prepared.
Preliminary and Detail Design
The production of the plans and specifications usually proceeds in two steps. The first step
is called preliminary design and offers the owner a pause in which to review construction
before detail design commences. A common time for this review to take place is at 40%
completion of the total design. The preliminary design extends the concept documentation.
In most projects, a design team leader concept is utilized. The design team leader
coordinates the efforts of architects and engineers from differing disciplines. The
disciplines normally identified are architectural, civil and structural, mechanical, and
electrical. Once the preliminary design has been approved by the owner, final or detail
design is accomplished. This is the second step in the production of the plans and
specifications.
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Notice to Bidders
The document announcing to prospective bidders that design documents are available for
consideration and that the owner is ready to receive bids is called the notice to bidders.
Because of his commitment to the owner to design a facility that can be constructed within
a given budget and at an acceptable level of quality, the A/E wants to be sure that the
lowest bid price is achieved. To ensure this, the job is advertised to those contractors who
are capable of completing the work at a reasonable price.
The notice to bidders contains information regarding the general type and size of the
project, the availability of plans and specifications for review, and the time, place, and date
of the bid opening.
Bid Package
The documents that are available to the contractor and on which he must make a decision
to bid or not to bid are those in the bid package. In addition to the plans and technical
specifications, the bid package prepared by the design professional consists of a proposal
form, general conditions that cover procedures common to all construction contracts, and
special conditions, which pertain to procedures to be used that are unique to a given
project.
The proposal form as designed and laid out by the A/E is the document that, when
completed and submitted by the contractor, indicates the contractor’s desire to perform the
work and the price at which he or she will construct the project.
General Conditions
Certain stipulations regarding how a contract is to be administered and the relationships

between the parties involved are often the same for all contracts. An organization that
enters into a large number of contracts each year normally evolves a standard set of
stipulations that establishes these procedures and applies them to all construction
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contracts. This set of provisions is normally referred to as the general conditions.
Supplementary Conditions
Those aspects of the contractual relationship that are peculiar or unique to a given project
are given in the supplementary conditions. Items, such as the duration of the project,
additional instructions regarding commencement of work, owner-procured materials,
mandatory wage rates characteristic of the local area, format required for project progress
reporting (e.g., a network schedule), and amount of liquidated damages, are typical of the
provisions included in the supplementary conditions.
Technical Specifications
A verbal description of the technical requirements is established in the technical

specifications. These provisions pertain in large part to the establishment of quality levels.
Standards of workmanship and material standards are defined in the specifications. For
materials and equipment, this is often done by citing a specific brand name and model
number as the desired item for installation. In government procurement, in which
competitive procurement must take place, a similar approach is used. Government
specifications usually cite a specific brand or model and then establish the requirement
that this or an equal item be used. The fact that equality exists must be established by the
bidder.
The Estimate and the Decision to Bid
After investigating the plans and specifications, the contractor must make a major decision
as to whether or not to bid the job. This is an important financial decision because it
implies incurring substantial cost that may not be recovered. Bidding the job requires a
commitment of man-hours by the contractor for the development of the estimate.
Estimating is the process of looking into the future and trying to predict project costs and
various resource requirements. The quantities of materials must be developed from the
drawings by an expert. The process of determining the required material quantities on a
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job is referred to as quantity takeoff or quantity surveying. Once quantities are established,
estimators who have access to pricing information use these quantities and their
knowledge of construction methods and productivities to establish estimates of the direct
costs of performing each construction task. They then add to the totaled project direct
costs those indirect costs that cannot be assigned directly to a particular physical piece of
the project but which must be distributed across the entire project (e.g., project supervising
costs). Finally, the bid price is established by adding the management and overhead costs,
allowances for contingencies, and a suitable profit margin.
End of Discussion.
Reference:
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Issues during Construction Phase
There are several issues in managing construction projects which lead to delays, poor
qualities and cost overrun.
1. Discuss issues during construction phase.
Project Rework Reduction
Rework occurs when the installed work does not comply with or meet required
specifications. According to Construction Industry Institute research, if field rework alone
can be significantly reduced, or even eliminated, as much as 10% of overall project costs
can be saved.
Field rework is not caused solely by construction site activities in isolation. For the field
rework to be reduced, a substantial effort must be made to improve the effectiveness of
the prior project phases with a view to preventing all too frequent ‘‘catch-up’’ work during
the site construction and commissioning phases.
Time Extensions
Once the formal contract has been signed, certain aspects of the contractor’s activity
during construction must be considered. Often circumstances beyond the contractor’s
control, which could not have been reasonably anticipated at the time of bidding, lead to
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delays. Claims for extension of time must be based on delays that are caused by the
owner or the owner’s agents or on delays due to Acts of God.
Change Orders
Changes that are dictated, for any reason, during construction represent an alteration of a
legal arrangement and, therefore, must be formally handled as a modification to the
contract. These modifications to the original contract, which themselves are small
augmenting contracts, are called change orders. Normally, a formal communication of the
change to include scope and supporting technical documents is sent to the contractor. The
contractor responds with a price quotation for performing the work, which constitutes his or
her offer. The owner can accept the offer or attempt to negotiate (i.e., make a
counteroffer). This is, of course, the classical contractual cycle. Usually, the contractor is
justified in increasing the price to recover costs due to disruption of the work and possible
loss of job rhythm. If the original contract documents were poorly scoped and prepared,
the project can turn into a patchwork of change orders.
Changed Conditions
Engineering designs are based on the project site conditions as they are perceived by the
architect/engineer (A/E) or design professional. For structural and finish items as well as
mechanical and electrical systems above ground, the conditions are constant and easily
determined. Variation\ in wind patterns leading to deviation from original design criteria
may pose a problem. But normally, elements of the superstructure of a facility are
constructed in a highly predictable environment.
Suspension, Delay or Interruption
Interrupting or suspending work for an extended period of time may be costly to the
contractor, since he or she must go through a demobilization remobilization cycle and may
confront inflated labor and materials at the time of restarting. In such cases, within the
provisions of the contract, the owner (i.e., the government) is required to pay an
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adjustment for ‘‘unreasonable’’ suspensions.
Liquidated Damages
In any case, the purpose and function of a project are often based on the completion of
the project by a certain point in time. To this end, a project duration is specified in the
contract document. This duration is tied to the date the project is needed for occupancy
and use. If the project is not completed on this date, the owner may incur certain damages
due to lacking the availability of the facility.
Progress Payment and Retainage
During the construction period, the contractor is reimbursed on a periodic basis. Normally,
at the end of each month, the owner’s representative (e.g., project or resident engineer)
and the contractor jointly make an estimate of the work performed during the month and
the owner agrees to pay a progress payment to cover the contractor’s expenditures and
fee or markup for the portion of the work performed.
In retainage, the owner typically retains or holds back a portion of the monies due the
contractor as an incentive for the contractor to properly complete the project. The
philosophy of retainage is that if the project is nearing completion virtually the entire bid
price has been paid out, the contractor will not be motivated to do the small closing-out
tasks that inevitably are required to complete the project.
End of Discussion.
Reference:
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Construction Management: Introduction To The Topic

Uploaded by

Construction Management: Introduction To The Topic

Uploaded by

Construction Management

Introduction to the Topic:

Intended Learning Outcomes:

1. ) Discuss project development

1. A need for a facility is identified by client

The key players in this developmental sequence are:

Construction management is resource driven. The job of a construction manager is to

For more references, kindly check TIP Online Resources

TIP Library (https://www.tip.edu.ph/library.html)

Property of the Technological Institute of the Philippines (T.I.P.). No part of the

Introduction to the Topic:

Intended Learning Outcomes:

1. Preparing bid package

Project Concept and Need

Formal Need Evaluation

Conceptual Drawings and Estimates

Preliminary and Detail Design

Certain stipulations regarding how a contract is to be administered and the relationships

A verbal description of the technical requirements is established in the technical

The Estimate and the Decision to Bid

For more references, kindly check TIP Online Resources

TIP Library (https://www.tip.edu.ph/library.html)

Property of the Technological Institute of the Philippines (T.I.P.). No part of the

Introduction to the Topic:

Intended Learning Outcomes:

1. Discuss issues during construction phase.

Project Rework Reduction

Suspension, Delay or Interruption

Progress Payment and Retainage

For more references, kindly check TIP Online Resources

TIP Library (https://www.tip.edu.ph/library.html)

Property of the Technological Institute of the Philippines (T.I.P.). No part of the

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