A special type of private owner who often owns the project only for the duration of construction.
T/F Facility managers are the most common professional owners representative?
True
What is the Constructor?
The professional responsible for all construction activities. Either general contractor or a construction manager.
May be brought in to advice the owner before design.
work as part of a design/build team
What is a project manager?
Assigned at beginning of project
owner's primary contact
responsible for scheduling work
negotiating construction contracts
What is the construction project manager?
part of the construction company
configure the project team
schedule the job
set up a const control system
Compare Decentralized and centralized firms?
Decentralized shift more decisions to the filed. Centralized firms retain the bulk of the decision making to head office. Centralized firms allow similar project to be standardized.
What is the Work Breakdown Structure?
organization of the project work.
deliverable grouping of work elements that subdivide the work into manageable parts
Explain the three Organization charts
1. Generalist - vertical lines and horizontal lines
2. Departmental - expanding tree moving away from president
3. Matrix - formal lines of communication between departments
What is a Sole Proprietorship?
Single person ownership
High risk for the owner
What is a Partnership?
Includes at least 2 people
Percentage of ownership varies
Each partner responsible for company debt
What is a limited partnership?
investors in a business but do not contribute to the management of the firm
only liable to the extent of his or her investment
What is a Corporation?
Each owner has stock in the company
Number of shares determines the number of votes
Independent of the stock holders
only assets owned by the corporation can be used to settle debt
Must pay tax twice
What is the basic communication loop?
Source ->Symbol->receive->feedback to source
What is a project delivery method?
combination of professionals arranged to assign responsibilities and risk in a certain way
3 most common project delivery methods?
1.Design/bid/build
2.design/build
3.construction management
What causes the scope to creep?
Difficult to get a complete consensus on project scope from the beginning
critical user is left out and must be accommodated later in the process
communication among the user, designer, and constructor
What are the risks of going into construction to fast?
Design elements are not thoroughly considered
complete design documents
What are the four classifications of general risk?
1. Financial - will cost more
2. Time - will not complete within planned time
3. Design - will not perform adequately
4. Quality - incomplete work
What are the project specific risks?
Site Risks
The project itself
organizational risk
What are the three general contract types?
1. Lump sum
2. Unit price
3. cost plus a fee
What are the steps in the Design/Bid/Build arrangement?
1.Owner hires a designer to design the project
2.with the design in hand, owner retains a contractor to build the project
Advantages of D/B/B?
well known and understood
contains considerable protection for owner
allocation of construction risk is almost completely on contractor
owner knows the final cost at the beginning
cost overruns are borne by the contractor
Owner does not have to be heavily involved in construction
Disadvantages of D/B/B?
Construction professional does not have input into the design
difficult to reduce the time required for design and construction
Not able to fast track
all parties work autonomously, little chance for team building
What are the steps in a Design/Build?
1. owner hires a design/build firm to perform both the design and construction
2.this firm designs, acquires materials, and deploys the labor force
Advantages of D/B
excellent communication between design and construction teams
project is easily fast tracked
allows easier incorporation of changes due to scope and unforeseen conditions
Disadvantages of D/B
generally not a fixed firm price
owner may have to make decisions on the fly
lack of checks and balances
owner must rely on ethics of the firm
does not guarantee the best possible price
What are the steps in Construction project management
1. owner hires both a design firm and construction project management firm in the beginning
2. construction project manager oversees work directly associated with construction
Advantages of Construction project management?
good communication among owner, designer, and constructor is established early
Allows for good value engineering
allows for fast tracking
subcontractors are under contract with the owner and compete for bid packages
Owner pays designer and construction manager a fee
Disadvantages of Construction project management?
requires good communication between owner, designer, and construction manager
High owner involvement
What is single fixed price?
perform a specified amount of work for a specific sum
owner knows before the work begins what the final cost will be
used with the D/B/B method
if errors in the design the contract will need to be renegotiated
fast track is not possible
What is a unit price contract?
agreed price per unit
eliminates risk to both the owner and the bidders
allows a competitive bid and fair price for the work
work can begin before design is complete
price is not fixed and may be significantly more
actual quantities must be measured in the field
What is Cost plus a fee contract?
reimbursed by the owner for work costs plus additional agreed-upon fee
good when scope is hard to define
good to fast track project
encourages value engineering
contractor is responsible for any additional costs beyond the guaranteed maximum price GMP
What causes contract changes?
1. change in owner requirements/scope
2. unforseen conditions
3. omissions in the documents or design features
Alternate dispute resolutions?
litigation
arbitration
mediation
negotiation
What is an Addenda?
change in the documents made during the bidding phase before contract acceptance
What are the bidding procedures?
1. offer to tender
2. amendments to tender call
3. pre-tender meeting with contractors
4. receipt and opening of tenders
5. tender review
6. Contractors evaluation
7. contract award
What if lowest tender is too low?
review your estimate
review bid in relation to other bids
request bidder to review his bid
bidder cannot increase the bid price
Lowest tender is too high
re invite lower bidders
change project scope
recall tender
What is a bond?
agreement made between the principal(contractor), surety(bonding company), obligee(owner)
security becomes liable to the obligee for the default in performing obligation
What are the four types of bonds?
1. bid bonds - guarantees that the contractor will enter into a contract
2. performance bonds - guarantees the contractor will perform the work
3. Payment bond - guarantees the contractor will pay all bills
compare a bond and insurance
The total amount of the bond must be paid back to the bonding agent. where insurance only get a premium back.
What are the risks covered by insurance?
builders risk
installation floater - subcontractors
equipment insurance
auto insurance
marine cargo insurance
What is in the contract documents
1. the agreement
2. general conditions
3. supplementary conditions
4. technical specifications
5. drawings and design details
What is the role of contracts, drawings, and specifications
