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The Stages of Construction Project Management

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The construction management life cycle begins at the same time as the bidding process, but once the contract has been finalized, the meat of the project can start.

Here are the stages in a construction project:

  1. Design

This is the first stage of a construction project, and once it is completed, it signals the beginning of the bidding process. In design-bid-build contracts, the owner chooses a contractor based on completed designs.

In this stage, an architect or engineer first assesses the feasibility of the design based on regulations and codes of the building, as well as the number of rooms, the size of the building, and the amount of space. Then he or she creates schematic designs or sketches, researching the type of equipment and materials needed and their cost.

  1. Pre-Construction

The bidding process is over and the owner has chosen a contractor. The contractor is then paired with the project team, including a contract administrator, project manager, field engineer, and superintendent. Then the team gets the site ready for construction. They conduct a site examination, test soil, and identify any possible unexpected situations, like environmental challenges.

  1. Procurement

The project team purchases the required equipment, materials, and labour. In other words, the procurement stage is when the team buys everything it needs to complete the project. The complexity of this stage depends on the size of the project and the company. Large national construction companies usually have procurement departments that hire labour and purchase materials for hundreds of projects at once. On the other hand, for smaller projects, the superintendent may buy limited quantities of materials from local building supplies or hire a local labourer.

  1. Construction

To kick off the construction phase, the superintendent will arrange a meeting with the subcontractors and material vendors to set the ground rules for working together. Then the team must get ready to start construction, completing activities like setting up temporary storage facilities, securing the site, developing a materials and handling plan, establishing safety programs, and more. After that, the team begins construction.

  1. Commissioning

Once construction is completed, the commissioning stage begins. There are two parts to the commissioning process. First, the project team must test the systems and equipment to make sure everything is working correctly before turning over the building to the owner. Then the team must train the owner’s personnel in the operation and maintenance of the systems in the new building.

  1. Owner Occupancy

When the owner moves into the new building, the warranty period starts. This ensures that all the materials, equipment, and building quality meet the expectations outlined in the contract. There are two types of warranties: express warranties (written and included in the contract) and implied warranties (established or required by law).

  1. Project Closeout

This final phase ties up any loose ends. The team formally completes any remaining contractual obligations to finish the project. They may create a project punch list of any tasks that didn’t get accomplished and may conduct a post-project review, document lessons learned, archive project documents, or prepare a project completion report.

Cost, Budget, and Finance in Construction Management

Project managers must always think about money. From estimating budgets before the project even starts to hiring and paying contractors, financial management is one of the most important parts of a successful project.

Here’s what you need to know about money matters in construction:

  1. Construction Pricing and Contracting

There are a number of options when paying contractors and outlining prices in contracts. In the competitive bidding process, contractors submit their bids to work on the project. These bids are either submitted on a lump-sum or unit-price basis, whichever the owner specifies. A lump-sum bid refers to the total price of work by the contractor. Unit-price bidding is used in projects where the amount of labour and materials are uncertain.

Instead of inviting competitive bidding, some private owners choose to award contracts to one or more selected contractors with negotiated contracts, which provides more flexibility in pricing. Negotiated contracts usually require reimbursement of direct project costs plus the contractor’s fee determined by one of these methods: cost plus a fixed percentage, cost plus fixed fee, cost plus a variable fee, target estimate, or guaranteed maximum price or cost.

  1. Cost Estimation and Budgeting

Cost estimation is prepared in order to submit a bid for a construction project and is used to establish a budget for the project once it is won. The process includes determining the cost estimates from building, unit prices and lump-sum estimates, job sites and general overhead, bidding procedures, and labour costs. Cost estimates are sometimes prepared by a professional, such as a building estimator or a chief estimator. Even though the project manager may not be the sole person responsible for cost estimation, it is still necessary that he or she become familiar with the process to understand the scope of the project.

  1. Cost-Control Monitoring

As the project begins, project managers need to quickly create a process to monitor project costs. The sooner the cost-control monitoring phase begins, the faster that project managers will be able to identify trouble spots. For example, if an item is significantly more expensive than the estimate, the project manager should identify the reason for the difference and see if that cost increase affects anything else in the budget.

  1. Capital Improvement Plan (CIP)

A Capital Improvement Plan (or Program) is a four- to 10-year plan that identifies capital projects and equipment purchases provide a schedule and identify options for financing the plan. The plan links a government entity, a strategic plan, and the entity’s annual budget. A CIP includes a list of all projects or equipment to be purchased, the projects ranked in order of preference, the plan for financing the projects, schedules for the construction phase of the project, justification of the project, and explanation of the expenses.

  1. Project Accounting

The project manager and/or the agency’s accounting department will have to develop the project budget for the fiscal year, record and report expenditures, review and pay contractor invoices, and manage cash flow. From materials to labor, there are many costs in construction projects. Costs are either direct (labour, material, subcontracting, and land) or indirect (indirect labour, supervision, tools, equipment, supplies, insurance, and support costs).

The project team and the accounting department may need to work closely together to manage contractor invoices. The project team reviews invoices to make sure the work has been properly completed, then the accounting department ensures that the invoices are contractually eligible and the prices are consistent with the contract.

Organizing and Scheduling a Construction Project

With RFPs, contracts, invoices, blueprints, and more, it can be hard to keep track of all the necessary documents in a construction project. Because construction projects are so large and involve complex information, the organization is key to staying on schedule.

Organization Strategies

There are several streams of information that need organization and management in any construction project. These are the most business-critical:

Records Management: Record management controls the distribution, storage, and retrieval of project records, both hard copies and electronic, in a safe, secure manner. Project managers must make sure that all incoming and outgoing documents are transmitted through the records management specialist, who uses software to track the records (this method will also create a central library of all project documents and information).

Contract Management: It is important to clearly define the roles and responsibilities of the project team members who are managing the project and the project staff responsible for managing contracts and documents. The contract management plan is designed to set expectations and procedures around this by addressing who has the authority to direct and approve the contractors to work, how the contractor’s work is monitored and reported, how they are paid and approved, how contracts are modified, which financial audits are necessary, etc.

Contract Procurement Planning: Project managers also have to ensure that procurement activities fit with the project plan. Some of the tasks they have to manage include:

  • Setting expected contract price
  • Creating the scope of work (SOW) for each contract
  • Standardizing procurement documents and any other necessary documents
  • Adding completion dates to contracts that align with the project schedule

Commissioning Plan and List: The commissioning plan and list should be started early in the design phase and continually updated as the project progresses. The commissioning plan is designed to provide direction for the commissioning process during construction; to resolve issues related to scheduling, roles, and responsibilities; and to aid in the reporting, approvals, and coordination. It is a systematic process to ensure that buildings perform according to the design and to the owner’s operational requirements.

Project Control Process: The project control process tracks and manages the scope, cost, and schedule of a construction project. The goals of this process are to establish a baseline, track performance against the baseline, forecast performance at completion and compare to the baseline, and identify changes and monitor the effects to the baseline.

Project Requirement Definition: Also known as the statement of work, this document details the project deliverables. In the project requirement definition (PRD), the project manager explains the scope of work and what the project will accomplish. It helps stakeholders, team members, and external parties all understand the goal of the project and acts as a record of initial expectations.

As-Built Drawings: Also known as record drawings, these are edited drawings submitted by a contractor at the end of a project. They reflect all the changes made in the working drawings during the construction process and show the dimensions, geometry, and location of all elements included in the contract. As-built drawings provide a quick visual into the existing design and capture deviations from the original documents.

Daily Documentation: Keeping diaries, logs, and daily reports of project activities acts as a reference guide after the work is completed and can mitigate any damages. This kind of documentation can show how questions were answered, how problems were solved, and tracks any unusual conditions on a certain day. By keeping these daily logs, you are leaving a paper trail throughout the whole project in case anything goes awry later on.

And finally, the working drawings are created. These are the project’s final specifications and illustrations that builders use for construction and that contractors add to their bids.

Scheduling Strategies

Organizing your documents helps you categorize and prioritize important project information, and once you have everything stored in a central location, you can build out your project schedule.

A well-defined schedule provides a structured approach to planning, identifies problems before they arise, forecasts cash flows, and assesses resource requirements.

Here are the fundamental and advanced scheduling techniques:

  • Gantt Charts: A Gantt chart is the easiest way to create a construction schedule. It lets you visualize your project timeline by transforming task names, dates, durations, and end dates into cascading horizontal bar charts. 
  • Critical Path Scheduling: The most widely used scheduling technique is the critical path method. This method calculates the minimum project completion time and the start and end dates for all project tasks. It identifies the critical tasks that, if delayed, will delay your entire project. The critical path method helps you reduce timelines, manage resources, and compare planned with actual.
  • Line of Balance: This scheduling technique is best suited for repetitive work and is often employed in road construction. It is a management control process for collecting, measuring, and presenting facts relating to time, all measured against a specific plan. With a Line of Balance schedule, you must allocate resources for each step, so you can make sure the next step is not delayed.
  • Q Scheduling: This form of construction scheduling addresses the sequence of activities, relationships between tasks, and the total cost of finishing the project. It includes the overall construction site and prevents two competing activities from happening at the same time at the same location. While this technique is the closest to reality, it requires special software and can take more effort from the project manager to evaluate cost analyses for the different schedule alternatives generated.

Problems, Issues, and Legal Matters in a Construction Project

Construction projects are always changing, and the constant level of uncertainty can often bring the conflict to project teams. Construction project managers are often tasked with resolving disputes, identifying and mitigating risks, and understanding legal ramifications.

Here’s what construction project managers should know:

How to Resolve Disputes

Conflicts will inevitably arise in any project. It’s the project manager’s job to resolve the disputes, so the team can stay productive and work well together. Possible conflicts in a project could include poor communication, lack of clarity, conflicts of interest, limited resources, or power struggles. While every conflict is different, there are several resolution strategies that you may employ:

  • Mediation: A third-party mediator will be hired to resolve the disputes between the two parties. This strategy is the cheapest and least time-consuming.
  • Mini-Trial: A mini-trial is held in an informal setting with an advisor or an attorney who must be paid. The agreement is nonbinding and can be broken. A mini-trial takes more time and more money than mediation.
  • Arbitration: Arbitration is the most expensive and time-consuming way to resolve a conflict. Each party is represented by an attorney while witnesses and evidence are presented. Then, the arbitrator makes a ruling and his final decision is a binding agreement.

How to Create a Risk Management Plan

By focusing on prevention, project managers can spend less time dealing with spontaneous problems and more time on reducing their impact. A risk management plan is used to manage all project risks, defines the roles of project staff in risk management, and identifies potential risks and categorizes them in terms of probability and impact.

Understand Legal Principles

When project managers have to negotiate contracts, deal with jurisdictions’ licensing requirements, purchase insurance, and manage job site safety, an understanding of legal principles can save time and money. There are several areas of liability in construction management. There could be a claim for failure to detect defective work if a bid exceeds estimates, if there is extended overhead, or if the project is delayed. Most professional liability policies don’t cover any aspect of faulty workmanship (like fabrication or installation) or economic risks, so project managers have to make sure they have the appropriate coverage and are doing everything they can to avoid liabilities and claims.

How to Prepare a Quality Control Plan

A quality control plan ensures that the building has reached a specific standard. Quality control is the last step a project goes through before it’s delivered to the owner, and it consists of a series of systems and procedures to make sure it meets the highest standards. Project managers will have to evaluate how to test quality, create a step-by-step process for auditing the project, and revise and review the plan to find new problem areas. They will also have to be knowledgeable in safety management and codes, building codes, and compliance codes, then include these aspects in the plan.

How to Anticipate and Address Environmental and Neighborhood Impacts of Construction

Construction project managers and their teams can plan for licensing, permits, and all measures of local regulations, but sometimes nature plays a part in the building process. These are a few ways flora and fauna, the land and the sea can affect your project plan — and how to deal with them.

Dust and Mud: Excessively dusty conditions can result from construction vehicles simply driving on a site, much less moving earth from spot to spot. Because the increased particulate matter can disrupt nearby businesses and homes, construction project owners would do well to control the dust count. One easy way to do so is to drive a water truck through the site and spray down the area. However, this creates mud, which can spread out to surrounding areas via construction vehicles. To counter this development, the project owners should get a street sweeper to clean the roads.

Storm Water Pollution: Construction projects can introduce foreign elements to the land. Should a storm hit, the runoff can carry those potential pollutants to nearby streams, rivers, lakes, aquifers, wetlands, or coastal waters.

Endangered Species: If an endangered species is found on the construction site, the site must cease operations for as long as it takes for authorities to assess the situation. Once a decision comes down, the contractor implements the proper course of action to not disturb the species.

Vegetation: Animals aren’t the only protected entities; trees and vegetation on a construction site could be subject to environmental safeguards too. The construction project manager could be faced with designating a safe zone for the growth, perhaps with a fence or security tape.

Wetlands: Wetlands are some of the most heavily protected areas in the United States. Contractors and builders must be especially vigilant in preventing contaminants or unregulated material from entering these restricted zones.

Historical or Cultural Artifacts: This classification can cover arrowheads, pottery shards, early tools, bones, and more. If any artefacts are found on the construction site, all work must halt until the pieces can be studied and removed.

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