TECHNOLOGICAL UNVERSITY OF THE

PHILIPPINES

DEPARTMENT OF
ARCHITECTURE
COLLEGE OF ARCHITECTURE AND FINE ARTS

PROJECT INITIATION

SUBMITTED TO.

ARCH. BALBERO

SUBMITTED BY:

ABEJERO, ROVILYN MAE

DELOS REYES, DARYLL
ORILLO, JAYMAR
TUAZON, MARY DENISE
VILLAMOR, PAM

PROJECT INITIATION:
Project initiation is where all the necessary analysis is undertaken to
allow the project to be planned. Initiating a project usually involves a
considerable amount of work, and therefore expenditure.
During this period a thorough analysis must be taken and recorded of
how any business processes, that the project will affect, are
structured, staffed, and run. Measurements should be taken at this
point that will be key or critical success factors of the project e.g. if
the project aims to increase the rate of data entry of forms to a
computerized system then a comparison cannot be made at the end
of the project if initial measurements during the old business process
do not exist.

PROJECT INITIATION

PROJECT SELECTION AND CRITERIA OF CHOICE

CONCEPTUAL DESIGN AND PLANNING
PRELIMINARY DESIGN
DESIGN AND CONSTRUCTION PROCESS
PRIVATE VS. PUBLIC PROJECTS
CONTRACTUAL ARRANGEMENTS
PHASES OF A PROJECT
PROJECT STRATEGY

4.1

PROJECT SELECTION AND CRITERIA OF CHOICE

One of the biggest decisions that any organization would have to make is
related to the projects they would undertake. Once a proposal has been
received, there are numerous factors that need to be considered before an
organization decides to take it up. The most viable option needs to be
chosen, keeping in mind the goals and requirements of the organization.

Project Selection
Project Selection is a process to assess each project idea and select
the project with the highest priority. Projects are still just suggestions
at this stage, so the selection is often made based on only brief
descriptions of the project. As some projects will only be ideas, one
may need to write a brief description of each project before
conducting the selection process.

Selection of projects is based on:

Benefits: A measure of the positive outcomes of the project. These
are often described as "the reasons why you are undertaking the
project". The types of benefits of eradication projects include:
Biodiversity
Economic
Social and cultural
Fulfilling commitments made as part of national, regional or
international plans and agreements.
Feasibility: A measure of the likelihood of the project being a
success, i.e. achieving its objectives. Projects vary greatly in
complexity and risk. By considering feasibility when selecting projects

it means the easiest projects with the greatest benefits are given
priority.
Why Do Project Selection
Often one will have a number of suggested projects but not enough
resources, money or time to undertake all of the projects. The ideas
for eradication projects may have come from many sources including:
the community, funders, local and national governments and NonGovernmental Organizations (NGOs). One will therefore need a way
of deciding on a priority order and choosing a project.
If the organization in question has limited experience in conducting
eradications then it is recommended to concentrate on a small
number of projects, ideally one project at a time, until the people in
the organization have developed the skills and experience. Its
important to grow capacity and build up to undertaking multiple
projects at any one time. One should do the easy projects first and,
only then, work towards the most difficult and rewarding projects. One
should use the easy projects to help answer questions/solve issues
for the more difficult projects. Also, one should use the best
opportunities to learn.

One may have a mix of straight forward and difficult eradication

projects and does not know where to start. The Project Selection
Stage, then, will assist one by providing a process to compare the
importance of the projects and select the most suitable project to
undertake.
By following the Project Selection Stage one will follow a step by step
objective method for prioritizing projects - this can be used to explain
to stakeholders the reasoning behind why one selected a particular
project.
The benefits of completing the Project Selection are:
A transparent and documented record of why a particular project was
selected.

 A priority order for projects, that takes into account their importance
and how achievable the project is.

When to Do
Undertake a Project Selection when one has more ideas than the
number of projects one can undertake and need to select the project
that should be given priority.
Note: If one only has 1 project in hands, it may still be useful to score
the project against a set of criteria to identify the strengths and
weaknesses of the project. The results may be useful later in the
Feasibility Study Stage.

Who Should Be Involved

Agency Management:
Set selection criteria to ensure the selection process aligns with
agency strategies.
Selection processes are often run as a management initiative before
the implementing Project Manager (PM) is assigned.
Stakeholders:
Stakeholder participation at the start of a project creates strong
community ownership and support, and increases the chances of a
successful outcome.
Stakeholder input should be included at the ideas stage; one should
consult widely as one is developing the ideas for projects as the
community will be the source of many of the best project ideas.
Stakeholders must be informed of the outcome of the Project
Selection Stage.
PM:

 Involving the PM in the Project Selection process will help build

ownership in the project and support a successful project in the long
run.

Diagram Overview
Each project idea is scored against the selection criteria and a total
project score is calculated. By ranking the ideas in order of the
highest score one is able to see which idea has the highest priority.
This procedure gives one the ability to take a number of possible
projects and identify which project is most important to first move to
the Feasibility Study Stage. This Stage is not required if one only has
one project idea. A diagram overview follows below:

Defining Project Selection Criteria Examples, Advantages and

Disadvantages
1 The formation of a Steering Committee
Most organizations have a formal, or at least semiformal, process to
select and prioritize projects.
A steering committee is responsible for project review, selection, and
prioritization. It is a group of people comprised of senior managers
and sometimes midlevel managers who represent each of the
functional areas in the organization.
Below, follows how it works:
The steering committee requests project ideas from the business staff
prior to the beginning of the fiscal year.
A special steering committee meeting is called to review the projects,
and a determination is made on each project as to whether it will be
included on the upcoming list of projects for the new year. Once the
no-go projects have been weeded out, the remaining projects are
prioritized according to their importance and benefit to the
organization. The projects are documented on an official project list,
and progress is reported on the active projects at the regular monthly
steering committee meetings.

In theory, its a great idea. In practice, it works only moderately well.

Priorities can and do change throughout the year. New projects come
up that werent originally submitted during the call for projects that
must be added to the list. Reprioritization begins anew, and resource
alignment and assignments are shuffled. But again, were getting
ahead of ourselves. One should be aware that organizations usually
have a process to recognize and screen project requests, accept or
reject those requests based on some selection criteria, and prioritize
the projects based on some criteria.
Large, complex projects may be subject to further review via a
feasibility study before a decision can be made to accept the project.

Feasibility studies determine the viability of the project and help the
company determine if the product or service of the project is
marketable, profitable, safe, and doable.
Whats the criteria? Well, project selection criteria is an input to the
project Initiation process. According to the Guide to the PMBOK,
project selection criteria is concerned with the product of the project.
In other words, selection criteria is concerned with what the product
or service of the project will produce and how it will benefit the
company.

Selection criteria concerns every area of business from marketing to

finance to information technology to human resources. It can be
subjective or objective. Criteria for judging project selection could
include financial measurements. For example, the selection criteria
might dictate that projects must increase profits by a certain
percentage in order to be considered.
Equally, project selection criteria might include the criteria that an
increase in market share or an increase in the public awareness of
the company or product will be enjoyed as a result of this project.
There arent any rules for project selection as the components of
selection criteria are up to the company, steering committee, or
project review committee to determine.
Predetermined selection criteria, such as mentioned above, is one
aspect of project selection, but so is the individual opinion, and
power, of selection committee members. One mustn't underestimate
the importance of the authority, political standing, and individual
aspirations of selection committee members. Those committee
members who happen to carry a lot of weight in company circles, so
to speak, are likely to get their projects approved just on the fact that
they are who they are. This is sometimes how project selection works
in an organization.

2 Choosing one of two methods:

Constrained Optimization

Benefit Measurement

and

There are various project selection methods practiced by the modern

business organizations. These methods have different features and
characteristics. Therefore, each selection method is best for different
organizations.
Although there are many differences between these project selection
methods, usually the underlying concepts and principles are the
same.
Below is an illustration of two of such methods (Benefit
Measurement and Constrained Optimization methods):

As the value of one project would need to be compared against the

other projects, one could use the benefit measurement methods. This
could include various techniques, of which the following are the most
common:

 The PM and his/her team could come up with certain criteria that
he/she wants his/her ideal project objectives to meet. The PM could
then give each project scores based on how they rate in each of
these criteria, and then choose the project with the highest score.
When it comes to the Discounted Cash flow method, the future value
of a project is ascertained by considering the present value and the
interest earned on the money. The higher the present value of the
project, the better it would be for the organization in question.
The rate of return received from the money is what is known as the
IRR. Here again, one needs to be looking for a high rate of return
from the project.

The mathematical approach is commonly used for larger projects.

The constrained optimization methods require several calculations in
order to decide on whether or not a project should be rejected.
Cost-benefit analysis is used by several organizations to assist them
to make their selections. Going by this method, one would have to
consider all the positive aspects of the project, which is the benefits,
and then deduct the negative aspects (or the costs) from the benefits.
Based on the results one receives for different projects, one could
choose which option would be the most viable and financially
rewarding.
These benefits and costs need to be carefully considered and
quantified in order to arrive at a proper conclusion. Questions that
one may want to consider asking are in the selection process are:
1) Would this decision help me to increase organizational value in the
long run?
2) How long will the equipment last for?
3) Would I be able to cut down on costs as I go along?

 In addition to these methods, one could also consider choosing

based on opportunity cost. In other words, when choosing any
project, one would need to keep in mind the profits that one would
make if he/she does decide to go ahead with the project.
Profit optimization is therefore the ultimate goal. One needs to
consider the difference between the profits of the project one is
primarily interested in, and the next best alternative.

Regarding the implementation of the chosen method:

The methods described on the previous pages can be carried out in
various combinations. It is best that one tries out different methods,
as in this way one would be able to make the best decision for the
organization in question considering a wide range of factors rather
than concentrating on just a few. Careful consideration would
therefore need to be given to each project.

4.2

CONCEPTUAL DESIGN AND PLANNING

KDWs design/build services begin with our conceptual planning

process. During the conceptual planning process, we can guide you
through planning your project from site selection, through design, to
building and construction and through to completion. Our conceptual
planning process will lay the groundwork to ensure your satisfaction
and contribute to your project's success.
Phase 1: Site Selection
KDWs site selection specialists understand the art and science
of site selection better than any developer in our region. Taking
land characteristics, usage requirements and access issues into
account, we select a property location that is ideal for your needs
and suitable for your budget. With access to all available land in
the SE Texas region, we have developed fruitful, long-term
relationships with area property owners. Because of this, your
property is selected at the best possible price and most attractive
terms.
Phase 2: Programming
During the programming phase, KDW programmers achieve the
perfect balance of design and build. It is during this stage that we
schedule briefyet thoroughmeetings with your team. After
developing a complete understanding of your companys desires

and objectives, we refine planning concepts in order to quantify

and qualify project scope, cost and schedule. During this
programming process, we establish a design and construction
plan that maximizes your budget and suits your requirements
perfectlywithout supplying more or less than you need.
The KDW programming phase culminates in delivery of a formal
proposal with a drive-out price, so there are no hidden fees or
surprises at closing. To eliminate ambiguities and unanswered
questions, your proposal also contains site plans, color renderings, 3D computer models and detailed delivery expectations.
First and foremost, throughout every part of our conceptual planning
process, the KDW team honors your time. We communicate only as
needed, so you can get back to running your business. We look
forward to partnering with youand to achieving your goals affordably
and efficiently.
Phase 3: Budget Development
Your budget is the lifeblood of your project, and it must be
effectively managed. Unfortunately, the construction industry is
fraught with shameless overruns. How can these overages be
avoided? Its simple: dont spend more than the budget. Unlike
many design-led construction approaches, KDWs unique
design/build process keeps your budget in focus throughout Pall
project phases. Its called master budgeting or the total budget,
and it is our turnkey approach to protecting your investment.
Depending upon your needs, master budgeting takes into account
financing options, land costs, owner equipment, design, construction,
due diligence, and other soft costs requirements. Balancing aesthetics,
functionality and cost, the process includes:
Effective communication on all aspects of the budget
Establishing a firm budget and detailed scope of work during initial
meetings

 Carefully monitoring your budget during all subsequent project

phases
Immediately alerting you to cost implications if your project scope
changes
At KDW, our goal is to ensure that your project never exceeds your
budgetand that you are in control of costs from day one. We achieve
these goals by avoiding cost-prohibitive design options and accurately
estimating drive-out costs from the beginning.
Phase 4: Value Engineering
Safeguarding your initial and long-term investment, KDW
embraces value engineering: a creative, organized process that
allows us to meet your objectives while respecting your budget.
From initial consultation to final walkthrough, each phase of your
design/build project is carefully orchestrated to achieve your
scope of work at the lowest feasible cost.
While other companies wait until your project is too far along to realize
cost savings, KDWs value engineering model gives you the
opportunity to make educated, cost-saving decisions from the very
beginning. Our value engineering process includes:
Developing an in-depth understanding of your budget
Analyzing your property and building objectives
Defining key project criteria
Verifying that your budget is adequate for the requested scope of
work
Offering affordable alternatives where costs can be reduced
Honoring your time by reducing questions to the simplest degree

4.3

PRELIMINARY DESIGN

Existing Conditions
The first work on the project involves documenting the parameters
within which we will design. This typically includes assisting the owner
in obtaining a survey of the property, and a geotechnical analysis. If
the project is a renovation the initial work also includes measuring the
existing building. We also review the zoning and building codes and
regulations relevant to the project.
Schematic Design
Schematic Design: An initial design scheme that seeks to define the
general scope and conceptual design of the project including scale
and relationships between building components. At the end of
the schematic design phase the architect will present some very
rough sketches to the owner for approval.
Before beginning the actual design work, we work with our
clients to get a clear idea of their needs and desires for the project,
beginning with reviewing their answers to our Design Questionnaire.
Then, based on our clients' functional needs, aesthetic preferences,
and budget requirements, we prepare a number of sketches that
illustrate the basic design ideas. These are often hand-drawn, and
include a site plan, the floor plans, the most important elevations, and
a section or two. If we're working with an existing building for which
we've already generated an ArchiCAD 3D model during our Existing
Conditions work, we may present the Schematic Design on the
computer rather than in hand sketches. The 3D virtual model of the
exterior of the project allows us to look at the design from every angle,

and see the path of the sun across the project. Our clients find this
very helpful in understanding the design. This phase, like all of the
design process, is iterative. We create a design, and then get the
owners' feedback on it, and then refine the design, or even produce an
entirely new one, based on that feedback. The sketches provide
talking points. They bring out the issues, and help both client and
architect focus and move toward appropriate solutions. We take a first
pass at specifications for materials and assemblies to be used in the
work toward the end of this phase. Before proceeding to Construction
Documents, we recommend having a contractor or three develop "ballpark" estimates based on the Preliminary Design sketches, to make
sure we're on track with costs. If we need to, we can adjust the scope
and quality of the work to meet the owner's budget goals.

4.4

DESIGN AND CONSTRUCTION PROCESS

Anatomy of a Construction Project

THE DESIGN AND CONSTRUCTION PROCESS

In general, when a construction project is initiated, a Facilities Planning and
Construction project manager is assigned to the project, and a building
committee is formed to oversee the project development until completion.
The life cycle of a project involves the following phases:

These phases are common to all new construction and renovation projects;
however, in smaller projects, the phases often become less formal, involve
fewer individuals and may have a short schedule of only a few months.
Large projects, on the other hand, may take years from the time they are
envisioned to the time "move-in" takes place. In general, the Department of
Facilities Planning and Construction (FP&C) provides leadership and
guidance, serves as a resource, and protects the interests of the college
throughout the entire duration of the project. The following describes each
phase of a large project:
Programming (2 to 6 months)
A building committee of approximately six individuals is formed to represent
the stakeholder group(s) involved with the project. The committee will be
responsible for making the necessary design decisions based upon user
requirements. One member of the committee will be designated as the
chair to act as liaison with the FP&C project manager. FP&C also serves

as a resource, sometimes in conjunction with external consultants, to assist

committees in developing the specific requirements for the project. A
Program of Requirements (POR) is developed that details all objectives,
spaces, services (i.e. telephone, data, utilities, etc.), equipment (new and
existing), special finishes, furniture and spatial relationships. The POR
forms the basis of the college's expectations and goals for the completed
project. The building committee and various other groups from the college,
if required, will review and contribute to the development of the program
documents prior to approval. In the case of technically complex projects, an
outside consultant may be engaged to prepare the program documents.

 Selection of the Design Professionals (1 to 2 months)

Design professionals are generally firms offering both architectural design
and engineering services. However, on occasion, design firms join with
engineering firms to form a design team. FP&C will issue a Request for
Proposal (RFP) in accordance with the Local Government Professional
Services Selection Act, using the Qualifications Based Selection process
(QBS). When proposals are received from design firms, the building
committee reviews and evaluates them to create a short list of design
firms (or teams) that have the necessary qualifications and experience to
be interviewed. The interviews consist of a formal presentation by the
proposed team members, illustrating their expertise in the relevant areas,
followed by questions from the building committee members. The
committee selects the firm it deems most suitable to meet the task and
recommends its selection to the college administration and Board of
Trustees for approval. The successful design firm uses the program of
requirements, institutional standards for design and construction, the
schedule and the construction budget, as well as any other applicable
requirements, as the basis for their design.
Schematic Design (2 to 4 months)
The first step by the design team is referred to as the schematic design"
phase, in which the objective is the development of simple diagrammatic
documents delineating room sizes and relationships, single line diagrams
of all systems (i.e. water mains, electrical risers, etc), preliminary elevation
studies of the building exterior, and, if applicable, drawings of special
interior spaces. The schematic design will be reviewed during frequent
meetings with the building committee and FP&C. At the conclusion of this
design phase, the architect will submit drawings, a project narrative and an
estimate of construction cost for review and approval by the building
committee and appropriate college representatives.
Design Development (2 to 4 months)
The approved schematic design is then further developed into definitive
plans and elevations by the design team. Colors, patterns, materials,
lighting fixtures, and special equipment and building elements are selected
and reviewed with the building committee. For complex laboratory projects,

detailed laboratory plans identifying all services, casework and equipment

are also developed. Detailed floor plans, sections, elevations and an outline
specification defining materials, finishes and systems, as well as an
updated construction cost estimate, are submitted for review and approval
by the building committee and appropriate college representatives.
Construction Documents (4 to 6 months)
The approved definitive design documents are developed into
comprehensive construction drawings and specifications that are used to
secure a building permit, if required, to competitively bid the work and
ultimately as the basis for the construction of the project. The construction
documents are submitted for review and approval by the building
committee and appropriate college representatives when the documents
are 50 percent complete and 100 percent complete (just prior to bidding).
After a thorough review and evaluation of all the bids by FP&C and the
Purchasing Department, the most responsive, responsible, low bidder who
meets all the requirements of the bid documents is selected and
recommended to the college administration and the Board of Trustees for
approval.
Construction (6 to 30 months)
The FP&C project manager coordinates the work, monitors costs and
scheduling, and reviews the construction work performed by the contractor.
The project manager will also keep the designated building committee
representative informed of the progress of the project. Building tours must
be arranged in advance with the project manager due to safety and liability
requirements. No one is allowed in the construction area without prior
authorization. Unforeseen changes that arise in the field are appropriately
handled by FP&C. Any user requesting changes to the project must be
directed in writing to the FP&C project manager. The project manager will
address these requests appropriately within the guidelines established by
the college.

Pre-occupancy/Commissioning
FP&C arranges for contractors to provide training for Operations personnel
and others who will be responsible for operating and maintaining the
facility. Operations assume operational responsibility for the facility at the
time of initial occupancy. Well in advance of the projected occupancy date
(generally, at least sixty days), persons designated by the building
committee must:
Submit a comprehensive listing and schedule to the FP&C project
manager. The schedule identifies who is moving (i.e. "from where - to
where") and is used by the movers, IT and Operations.
Contact IT to arrange for the activation of select telephone and data
communications outlets.
Contact Operations to arrange for keys.
Moving
The FP&C project manager will hire professional movers, if required. The
building committee will designate the representative(s) to coordinate
specific move times with the faculty, staff and students involved. The
moving company will provide packing materials and instructions. Generally,
all packing is the responsibility of the parties being moved. The academic
unit is responsible for retaining technical, scientific, and any other special
equipment procurement and installation. Special arrangements can be
made through FP&C for equipment movers and hook-up of utilities when
needed.
Occupancy
At the time of initial occupancy, the FP&C project manager will give an
overview presentation and tour of the facility to designated
representatives. This will include an explanation of how the building is
zoned for thermal comfort, operation of appropriate building
components, the location of emergency equipment and exits, etc. The
operational and maintenance responsibility for the facility is turned
over to Operations at this time. All calls for service relating to the
building should be directed to Operations. The FP&C project manager
will be available to assist with resolution of warranty and postoccupancy construction issues.

4.5

4.6

PRIVATE VS. PUBLIC PROJECTS

CONTRACTUAL ARRANGEMENTS

Aims and Objectives

At the end of this section you should be able to:

State the options available in determining the contractual

arrangements for a project.

The contractual arrangements will depend on the type of work being carried
out, although whichever type is adopted its purpose is to formalise the
relationship between the client and the contractor and sets out the rights
and responsibilities of the parties. The actual standard contract chosen will
also depend on the type of work and the practices and preferences of the
client.

In any contract there are a number of implications resulting from that

contract. In construction a contract tends to deal with a number of specific
aspects such as:
contractual conditions
tendering arrangements
main contract implications
forms and agreements
intentions of parties
commencement and completion
control of the works
payments
insurance
determination
How these are dealt with will depend on the type of contract that has been
adopted though a good source of information relating to the contractual
procedures and their implications can be found in the Ashworth book listed
below and you should familiarise yourself with this and the areas that are
pertinent.

Standard forms of Contract

The building industry has a number of standard forms of contract which are
used to simplify the contractual process. The other advantages of using
standard forms are:

It saves time and money to use a contract which is available rather

than prepare one for each job

The contract is fair to all parties

People become familiar with the document.

The most common are the Joint Contracts Tribunal (JCT) though others are
available depending on the type of work and the country the work is being
carried out. These are prepared by the representatives of professional
institutions such as RICS, RIBA. The main types refer to the type of
employer and the form of pricing. Eg

Private with Quantities

Private with Approximate Quantities
Private without Quantities
With Contractors Design
Local Authorities with Quantities
Local Authorities with Approximate Quantities
Local Authorities without Quantities
There are also specific contracts such as:
Form of Agreement for Minor Works
The intermediate Form of Building Contract - used on less
complicated work
Prime Cost Contract - used where prior estimating is not practicable,
contractor is paid for the cost incurred plus a fixed or percentage fee.
The Management Contract - used where the contractor manages the
work.
Other contracts are available from the other Institutes i.e. Civil Engineers.
A guide to the standard forms of contract can be found at the link below.

New Engineering Contract (NEC).

In addition a contract which is often used for services contracts is the New
Engineering Contract (NEC).
The New Engineering Contract, or NEC Engineering and Construction
Contract is a formalized system created by the Institution of Civil
Engineers that guides the drafting of documents on civil
engineering and construction projects for the purpose of obtaining tenders,
awarding and administering contracts. As such they legally define the
responsibilities and duties of Employers (who commission work)
and Contractors (who carry out work) in the Works Information.
The NEC is an integrated set of contract documents that are designed to
provide Clients and their suppliers with project-focused outcomes. It aims
to ensure the achievement of Client's objectives for the projects in relation
to quality, performance, cost and time.

There are six options for the NEC, theses are:

Option A: Priced contract with activity schedule
Option B: Priced contract with bill of quantities
Option C: Target contract with activity schedule
Option D: Target contract with bill of quantities
Option E: Cost-reimbursable contract
Option F: Management contract
These options offer a framework for tender and contract clauses that differ
primarily in regard to the mechanisms by which the contractor is
reimbursed and motivated to control costs.
The core clauses (of the main option listed above) are used in conjunction
with the secondary options and the additional conditions of contract.

The clauses of these options can be adapted for low risk projects
and subcontractors by using:

The Engineering and Construction Short Contract

The Engineering and Construction Subcontract Contract

More information can be found from the Document What is the NEC or
from the Questions on NEC linked to below.
FIDIC

The Traditional FIDIC Forms of Contract

FIDIC (Federation International des Ingnieurs Conseils) is a standard
form of contract for use in the construction industry. The FIDIC suite of
contracts is generally accepted by employers and contractors as providing
a recognisable common basis of agreement for defining the conditions of
contract and is used worldwide.
There are a number of forms of contract, these include:

The Red Book - Conditions of Contract for Works of Civil Engineering

Construction
The Yellow Book - Conditions of Contract for Electrical and
Mechanical Works including Erection on Site
The Orange Book - Conditions of Contract for Design-Build and
Turnkey
The Silver Book - Conditions of Contract for EPC Turnkey Projects:
provides for the Contractor taking almost all risks
The Green Book - Short Form of Contract: deals with the wide
demand for a simpler form of contract
The New Red Book - Conditions of Contract for Construction - design
by Employer:
The New Yellow Book - Conditions of Contract for Plant and DesignBuild
The New Gold Book Conditions for Design, Build and Operate
Projects.
The New Books have improved the documents by having more consistent
wording, with improved clarity and a more user-friendly format and layout
and provides examples of particular conditions. The contract is applicable
to international and domestic use and allows the framework to be adapted
to suit local law and for the General Conditions not applicable to be
disregarded.

The Distinction between the Books is based on:

who does the design?

who bears risk for change in quantities?

The contract accepts that every project is unique though contains:

Guidelines of best practice

Part I General Conditions

Part II Conditions of Particular Application

Contents
The Contents cover:
1. Introduction
2. FIDIC - Structure of FIDIC (as an organisation); the history of the FIDIC
forms; and FIDICs relationship with other organisations
3. FIDIC Usage - Industry context of the use of the FIDIC forms;
historic/geographic use of the FIDIC forms; and specific user groups
4. A FIDIC Contract - The FIDIC suite; documents forming a FIDIC contract;
procurement and contract award; and applicable laws and permissions
5. Product - Scope of the works; variations; standards/quality issues;
testing and performance; operation service period (gold book); and defects
6. Price - Provisions for payment
7. Time - Progress; time for completion
8. Contract Administration - The role of the contract administrator; notices
and procedures; claims
9. Risk, Indemnities, Insurance and Securities
10. Remedies - The employers remedies including delay damages and
termination; Contractors remedies including extension of time, suspension
and termination; force majeure and exceptional events
11. Disputes - Dispute boards; amicable settlement; and arbitration
Assignment and Subletting
The contractual arrangements will also cover such things as assignment,
subletting and the use of subcontractors.
Assignment

This is the transferring the interests of one party to another. Neither the
employer nor the contractor may assign any part of the contract without the
written consent of the other party.
Subletting
This occurs where the contractor enters into a subcontract with another
party to carryout work whilst still maintaining the existing relationship with
the employer in all respects.
Subcontractors
The contractor cannot subcontract any part of the work without the written
consent of the architect or contract administrator. The employment of the
subcontractor is automatically terminated upon the determination of the
main contract.
A subcontractor is effectively treated the same as if they were the main
contractor, which would mean that materials or goods of a subcontractor
could not be removed from site once they were brought on without written
permission.
There are three types of subcontractor:

Domestic Subcontractors - These are subcontractors the main

contractor chooses to employ. The contract does not recognise the main
contractors own subcontractors, any work carried out by these is taken as
if it were carried out by the main contractor.

Named Subcontractors - The contract document may name a

number of persons or firms who can be used by the main contractor to
undertake certain work as a subcontractor. This gives the contractor the
option of choosing one of them.

Nominated Subcontractors - this refers to a nominated person or

firm who is to carry out certain aspect of the contract. The main contractor
has no responsibility to carry our work that is intended to be carried out by
a nominated subcontractor. These are normally nominated by the architect
on behalf of the employer. Works that are to be carried out by a nominated
subcontractor are referred to in the BofQ as a prime cost sum.

4.7

PHASES OF A PROJECT

1. Schematic Design
Well work with your program of requirements to sketch out some
initial rough drawings. Conceptual drawings without much detail,
but showing the relationship of each space to the other spaces. If
we were creating a painting, these would be very broad strokes
with a large brush. It develops the overall idea of the building,
and we begin to think about the major building systems like
structure, mechanical and electrical.
2. Design Development
Once youre satisfied with the schematic drawings well develop
them further, adjusting and refining as we go along. Well begin
to think about materials and colors as well as more specific
details about the building systems like what kind of structure,
ventilation, plumbing and electrical is best. These drawings may
be used to apply for Development Permits, present to
committees, for marketing, fundraising and other purposes.
3. Construction Documents
Now we develop enough detail so that a contractor could actually
build the design. We coordinate the work of the structural,
mechanical and electrical engineers to minimize discrepancies
between the various systems. We create written specifications
that dictate the performance and quality of each component of
the building. This phase accounts for about half the total design
fee because it takes so much time and effort.
4. Bidding and Negotiation

 We help you review the results of the bidding process and award
a construction contract to the successful bidder. During this
phase we answer any questions from bidders and clarify the
drawings so that every contractor is bidding on the same
information, ensuring the process is fair.
5. Contract Administration
Once construction begins we work to ensure that the actual
building meets the intent of the design drawings. Well meet the
contractor on site at regular intervals to address any unexpected
problems as they come up. Well deal with any proposed
changes and prepare change orders which are the formal
method of changing the construction contract with an extra cost
or a credit.

4.8

PROJECT STRATEGY

Project strategy is a direction in a project that contributes to success

of the project in its environment.
We selected the word direction to describe explicit elements of
the project strategy. It can be interpreted as either one or several
of the following: goals, plans, guidelines, means, methods, tools,
or governance systems and mechanisms including reward or
penalty schemes, measurement, and other controlling devices

Contribute refers to the assumption that the direction has an effect i.e., it
matters and makes a difference
Success refers to how well the project is able to accomplish its goals.
Environment refers to the world outside the projects boundaries with
which project as an open system must continuously interact.

Types of project strategy

 Project with obedient servant strategy considers its parent

organization as the most important stakeholder in its
environment. Project exists for its parent and the objective for the
project is to fulfill its parents will. An obedient servant strategy
may result to the projects success due to appreciation of the
parent organization, measured by how well the project
implements and supports the parents business strategy.
Project with independent innovator strategy establishes its
direction by encouraging innovative and independent behavior
for finding or maintaining the projects own business content and
purpose. Project joins with such parts of the parent organization
(e.g. sponsors) or other stakeholders that help to advance the
projects purposes, but it simultaneously competes, fights or
hedges against such parts of the parent or other stakeholders
that pose a threat to the projects purpose. The success of an
independent innovator strategy may be measured through
newness, degree of change, or impact related to the projects
outcome, or even through the projects capability to renew or
change its parents business strategy.

 Project with flexible mediator strategy finds its direction by

defining its operating environment as that among the group of
several strong stakeholders. The project adapts to its
stakeholders goals and objectives set for the project, to
stakeholders standards of practice, and potentially to the
industry practice that the stakeholders represent. The success of
a flexible mediator may be measured by the synergy that the
project could create among stakeholders participation, by the
level or number of feasible compromises among the
stakeholders, or simply by the projects survival in the complex
setting of multiple stakeholders with different and conflicting
objectives and standards of practice.
Project with strong leader strategy selects its direction by
creating a strong independent culture and feeling of the
importance of making the project successful. This means that the
project establishes and adjusts its own goals and objectives in its
stakeholder network. The project is organized from inside out by
creating a governance umbrella where stakeholders are
positioned in purposeful roles while some stakeholders may
even be deliberately excluded from the overall governance
scheme. The success of a strong leader strategy may be
measured by the projects internal capability of creating a unique
view of perceiving the world and establishing purposeful goals
and objectives for the project, capability of using specific
stakeholders as resources, and capability to change stakeholder
salience (or stakeholders power to influence the project).