INMA for Construction & Industrial Development

PROJECT MANAG EMENT OVERVIEW

Table of Contents

PROJECT STAGES – GENERAL OVERVIEW -------------------------------------------------------- 4

Page | 1 Stage 1: Business Planning------------------------------------------------------------------------------------------------------ 4

Stage 2: Project Development --------------------------------------------------------------------------------------------------- 4

Stage 3: Preparation for Construction --------------------------------------------------------------------------------------- 4

Stage 4: Construction -------------------------------------------------------------------------------------------------------------- 4

Stage 5: Commissioning and Completion----------------------------------------------------------------------------------- 4

Stage 6: Occupancy ---------------------------------------------------------------------------------------------------------------- 5

STAGE 1: BUSINESS PLANNING ------------------------------------------------------------------------ 6

1.1 Organizing the Start of the Project --------------------------------------------------------------------------------------- 6
1.1.1 Owner’s Senior Manager and Project Manager roles-------------------------------------------------------- 6
1.1.2 Initial part of Design Manager role --------------------------------------------------------------------------------- 6

1.2 Practices during Business Planning ------------------------------------------------------------------------------------- 6

1.2.1 Project Concept and Initiation ------------------------------------------------------------------------------------------- 7
1.2.2 Defining the Owner Organization--------------------------------------------------------------------------------------- 7
1.2.3 Business Risks and Project Alternatives---------------------------------------------------------------------------- 8
1.2.4 Regulatory Management Strategy ------------------------------------------------------------------------------------- 9
1.2.5 Business Plan (for the project) ------------------------------------------------------------------------------------------ 9
1.2.6 Pre-construction Financing -------------------------------------------------------------------------------------------- 10
1.2.7 Approval to Develop Project (or not) -------------------------------------------------------------------------------- 10
 Project Development Instruction ---------------------------------------------------------------------------------- 10

1.3 Management Problems during Business Planning ---------------------------------------------------------------- 11

STAGE 2: PROJECT DEVELOPMENT ---------------------------------------------------------------- 13

2.1 Organizing Project Development ----------------------------------------------------------------------------------------- 13
2.1.1 Owner’s Senior Manager Role during Project Development ----------------------------------------------- 13
2.1.2 Project Manager Role during Project Development ----------------------------------------------------------- 14
2.1.3 Design Manager Role during project development ------------------------------------------------------------ 14
2.1.4 Construction Manager Role during project development --------------------------------------------------- 15

2.2 Practices during Project Development --------------------------------------------------------------------------------- 15

2.2.1 Consultant Selection ------------------------------------------------------------------------------------------------------ 15
2.2.2 Project Implementation Plan ------------------------------------------------------------------------------------------- 15
2.2.3 Site and Environmental Investigations ----------------------------------------------------------------------------- 16
2.2.4 Schematic Design and Design Development -------------------------------------------------------------------- 16
 Schematic Design including Site Finalization ---------------------------------------------------------------- 16
 Design Development including Drawings for Development Approvals ---------------------------- 16
2.2.5 Quality Management Planning ---------------------------------------------------------------------------------------- 17
2.2.6 Planning for Risk and Project Delivery ----------------------------------------------------------------------------- 17
2.2.7 Master Project Plan -------------------------------------------------------------------------------------------------------- 18
2.2.8 Approvals for Development -------------------------------------------------------------------------------------------- 18

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2.2.9 Approve Project to Proceed or Cancel or Defer Project ----------------------------------------------------- 18

2.3 Management Problems during Project Development-------------------------------------------------------------- 18

 Ineffective Direction by Owner ------------------------------------------------------------------------------------- 19
 Improper Management of Design and Non-design Services ------------------------------------------- 19
 Inadequate Planning for Project Delivery ---------------------------------------------------------------------- 19
Page | 2  Flawed Management of Permits and Funding ---------------------------------------------------------------- 20
 Confusion over Expectations -------------------------------------------------------------------------------------- 20

STAGE 3: PREPARATION FOR CONSTRUCTION ------------------------------------------------ 21

3.1 Organizing Preparation for Construction ------------------------------------------------------------------------------ 21
3.1.1 Modify Design Team------------------------------------------------------------------------------------------------------- 21
3.1.2 Technical Documents for Building Permit and Construction ---------------------------------------------- 21
3.1.3 Quality Assurance Program -------------------------------------------------------------------------------------------- 22
3.1.4 Municipal Building Permits --------------------------------------------------------------------------------------------- 22
3.1.5 Financing for Project Construction ---------------------------------------------------------------------------------- 22
3.1.6 Planning for Construction ---------------------------------------------------------------------------------------------- 22
3.1.7 Procurement for Owner Supplied Materials and Equipment ----------------------------------------------- 23
3.1.8 Construction “go”, “no-go” decision ------------------------------------------------------------------------------- 23

3.2 Management Problems during Preparation for Construction -------------------------------------------------- 23

STAGE 4: CONSTRUCTION ------------------------------------------------------------------------------ 24

4.1 Organizing Construction ---------------------------------------------------------------------------------------------------- 24
4.1.1 Working Documents for Construction ----------------------------------------------------------------------------- 24
4.1.2 Regulatory and Construction Management Procedures ---------------------------------------------------- 25
 Design Coordination and Construction Reviews ----------------------------------------------------------- 25
(Agreed by Site Supervision Consultant, prime consultant and contractor) ------------------------------------- 25
 Other Contract Administration ------------------------------------------------------------------------------------- 25
(Agreed by Site Supervision Consultant, contract administrator, contractor, and subcontractor) -------- 25
 Construction (established by contractor) ------------------------------------------------------------------------- 25
4.1.3 Shop Drawing Preparation and Administration ----------------------------------------------------------------- 26
4.1.4 Construction Tracking ---------------------------------------------------------------------------------------------------- 26
4.1.5 Quality Control of Construction -------------------------------------------------------------------------------------- 26
4.1.6 Construction Safety ------------------------------------------------------------------------------------------------------- 27
4.1.7 Administration of Contract Schedules, Changes, and Payments ---------------------------------------- 27
 Administration of Construction Schedules ------------------------------------------------------------------- 28
 Contract Changes ------------------------------------------------------------------------------------------------------- 28
 Payments for Work in Progress ----------------------------------------------------------------------------------- 28
 Contractual Relations ------------------------------------------------------------------------------------------------- 28
4.1.8 Construction Reviews including Regulatory Requirements ----------------------------------------------- 29
4.1.9 Building Ready to Commission --------------------------------------------------------------------------------------- 29

4.2 Management Problems during Construction ------------------------------------------------------------------------- 29

 Schedule Management --------------------------------------------------------------------------------------------------- 30
 Responsibility for Management and Administration ---------------------------------------------------------- 30
 Dispute Management ------------------------------------------------------------------------------------------------------ 30
 Shop Drawings -------------------------------------------------------------------------------------------------------------- 31

STAGE 5: COMMISSIONING AND COMPLETION ------------------------------------------------- 32

5.1 Organizing Commissioning and Completion ------------------------------------------------------------------------- 32
5.1.1 Building Systems Start-up ---------------------------------------------------------------------------------------------- 32

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5.1.2 Substantial performance ------------------------------------------------------------------------------------------------ 32

5.1.3 Occupancy Permit --------------------------------------------------------------------------------------------------------- 32
5.1.4 Permanent Records ------------------------------------------------------------------------------------------------------- 32
5.1.5 Handover to Property Management --------------------------------------------------------------------------------- 33
5.1.6 Financial and Administrative closure ------------------------------------------------------------------------------- 33
5.1.7 Project Review for Lessons Learned ------------------------------------------------------------------------------- 33
Page | 3 5.1.8 Closure of One-year Warranties -------------------------------------------------------------------------------------- 34
5.1.9 Final Project Acceptance by Owner --------------------------------------------------------------------------------- 34

5.2 Management Problems during Commissioning and Completion --------------------------------------------- 34

STAGE 6: OCCUPANCY ----------------------------------------------------------------------------------- 36

6.1 Initial Responsibilities for Occupancy Period ----------------------------------------------------------------------- 36

6.2 Management Problems Evident during Occupancy --------------------------------------------------------------- 36

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A BACKGROUND OVERVIEW ON MANAGING THE STAGES OF A PROJECT

PROJECT STAGES – GENERAL OVERVIEW

There are five major stages leading up to the project sixth stage, building occupancy. These are
Page | 4 universal stages, applicable to all types of projects and all delivery methods:

1 2 3
Business Preparation for Construction ‘Go’ or
Development
Planning Consultant ‘No-go’ Decision

4 5 6
* Construction Commissioning &
Construction Occupancy
‘Go’ - Decision Completion

Figure 1 - Stages in the Building-Life cycle Before and After Final Construction “Go”, “No-go” Decision

Stage 1: Business Planning

This initiates the project with a stated goal. Design feasibility studies may be required to assist with
project selection and justification. Project financial planning is an essential component. In this
stage project Ownership is established. All these points are combined in a project business plan
with which the Owner decides whether or not to authorize project development.

Stage 2: Project Development

This is where the bulk of the project consultants are selected and the Owner approves the Project
Implementation Plan including design instructions. Design work is begun and carried through to
application for municipal development (or local authority) approval and Owner’s approval of the
Master Project Plan.

Stage 3: Preparation for Construction

At this stage the design is completed sufficient for construction, the building permit is obtained, and
the construction work is tendered and awarded for all trades.

Stage 4: Construction
The project is actually built, involving management and review of construction, and administration
of the related contracts.

Stage 5: Commissioning and Completion

This includes proving the building systems, obtaining the occupancy permit, completion
documentation, and turnover of the building to the Owner for occupancy and use.

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Stage 6: Occupancy

This includes description of initial responsibilities for occupancy period and consideration for
design and warranty requirements. During this period a focus on Management Lessons Learned is
held.
Page | 5 The Building Process follows a relatively fixed sequence of stages between project concept and
completion. Each of these, if properly carried out, is a building block of project success. Each stage
includes its own sequence of management decisions.

Stages Milestones
Project Initiated
1 Business
Planning Development authorized
2 Project
Development Development approved
3 Preparation for
Construction Working drawings &
construction contracts
4 Construction
Ready for commissioning
5 Commissioning
& Completion Substantial completion &
project handover
6 Occupancy
End of warranties
(after project)

Figure 2 - Project Stages

The sequence in the above figure represents the project life cycle from concept, through
development, design documentation and construction, to completion, leading to the occupancy
period (after the project completion).
Each stage should be sufficiently complete and, for pre-construction, project viability confirmed
before the Owner authorizes the next stage to proceed. The responsibility assignments and
practices for achieving the results vary with the delivery method.
For some projects, ‘sufficient’ may mean full completion of each stage. For others, significant
overlapping of stages may be acceptable. Especially on a fast-track project, there may be
substantial exceptions to total completion of an intermediate stage when the next one starts.

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STAGE 1: BUSINESS PLANNING

1.1 Organizing the Start of the Project

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The project begins with the Owner’s concept and then the business planning based on it. This first
stage is the direct responsibility of the originating Owner.
This stage should be completed by approval or rejection of a business plan derived from the
project concept, and hence a decision whether and when to proceed with project development.
The decision should be based on a project definition which meets regulatory constraints, an
approximate project budget and schedule, and plans for funding, all at a summary level.

1.1.1 Owner’s Senior Manager and Project Manager roles

The Owner should assign a senior manager to provide the main interface between the project and
the Owner organization as a whole, including specific approval authority. The alternative is to risk
the project being governed by uncoordinated influences. The assigned senior manager, who may
be considered as a sponsor of the project, should appoint a “Project Manager” with the necessary
broad qualifications to lead this stage and lead or oversee subsequent stages.
If the Project Manager is retained from outside the organization the selection process should be
based on the specific required qualification. Such qualification-based methods should be used to
select management, design and advisory consultants.
The assigned Project Manager whether from the Owner’s staff or under contract, needs broad
expertise in the Building Process. The Project Manager arranges contracts between the Owner
and others.
The Project Manager needs to be especially effective in bringing cohesion to the Owner’s
organization, in determining the approach to management of the whole project, and in recognizing
the Owner’s longer-term interests and liabilities.

1.1.2 Initial part of Design Manager role

The design studies at this stage of the project may be at a very conceptual level. However, they
require coordination and have substantial impact on whether the project justification is founded on
a complete overview of the scope of work and the problems to be addressed later. Hence it is
prudent to assign the role of Design Manager during business planning, to retain and coordinate
design professionals in feasibility studies and preparing a design concept for each active project
alternative.

1.2 Practices during Business Planning

This sub-section gives general guidelines for practices needed to make a prudent project selection
and to enable project development then to proceed in an orderly manner. Business planning
practices are required for business and public service opportunities and include evaluation of
potentially feasible project alternatives. A great deal of the planning effort is spent during this time.
One of the goals of the Business Planning effort is to set or establish the “go” – “no-go” milestones
for the project and this is done during the early stages of the project.

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1.2.1 Project Concept and Initiation

A project is considered to start when a prospective Owner recognizes an opportunity or need for a
building, and decides to study its concept. The Owner should make preliminary statements of the
Page | 7 project goal and end product definition. This should include any required building characteristics,
and any identified alternatives whether relating to use, project scope or building location.
Since a good start is the key to a successful project, a management discipline should be put in
place at once and elaborated on as the project team increases in size and diversity. The Project

Stage 1: Business Planning

Start of Stage 1: a Project Concept and Initiation

Opportunity or b Defining the Owner Organization

Need for a
c Project Alternatives & Business Risks
Building-Project
d Regulatory Management Strategy

e Business Plan

f Pre-construction Financing
Stage 2
Stage End: Approval to Develop Project
Project Development
( or not )

Figure 3 - Business Planning Practices

Manager and the senior manager should agree terms of reference, a time frame, resources and a
budget for completing the business planning stage.

1.2.2 Defining the Owner Organization

Usually, the Owner that undertakes a building-project is a sole entity and is involved with the
project throughout. However, public-private partnerships are on the increase. , an originating
Owner may arrange a joint venture for the project. Or, the Owner may assign management of the
whole project to a developer or other agent. These options may cover a period of building
occupancy. Business arrangements such as these determine the legal Owner of the project and
how management roles are to be carried out or delegated throughout. The Owner organization
varies among projects, but the Building Process is much the same.
Whatever Ownership arrangements are made, they should provide a single business entity for
interfacing with the project, with the lead Project Manager role clearly identified. Under some
circumstances business partners may be added or changed later in the project. This requires
special care to minimize disruption and to clearly communicate or revise the Project Objectives.
The options for forming the Owner organization are sometimes called project delivery methods.
For example, contracting out the management of the whole project to be managed by a Project
Manager as agent is sometimes called the “Project Management” delivery method. Whatever
Owner organization is formed during the business planning stage will later select the delivery

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method. The Project Manager should prepare a preliminary strategy which should influence the
Owner’s organization for the project. The implications of the various delivery options for quality and
risk should be considered. This helps prepare for the project development stage with its increasing
complexity.

Page | 8 1.2.3 Business Risks and Project Alternatives

There may be alternative business opportunities, project locations, or building characteristics that
need to be considered. Evaluation of these and other business needs may dictate changes to the
preliminary goal and consideration of further project alternatives. The risks include the possibility
that the project will be unsuccessful, and that substantial liabilities may be incurred.
Each Owner needs to tailor risk analysis and the associated benefit-cost evaluation to the specific
business. The Owner may accept, mitigate, and/or assign risks, or spend effort and money to
remove uncertainties and reduce the possibility of problems.
Risk analysis should be a major factor in selecting the preferred project alternative. The Owner’s
tolerance for risk, or even an unfavorable project outcome, may be a crucial aspect of the business
plan and the deciding factor for whether to go after uncertain opportunities. Risk planning interacts
with stipulation of quality requirements which are in addition to those needed for compliance with
regulations. Higher quality is likely to give better performance, but at a cost premium.

1. Establish the Context

Identify Business Requirements.
Identify Boundaries and Constraints.
Identify Stakeholders‫ز‬

2. Identify Risks
Determine Communication Methods with Stakeholders.

Identify Potential Sources of Risk.

Conduct Research, If Required.
Communicate Decisions and Key Events.

Maintain Records Management System.

6. Communicate and Consult

Consult Regarding Issues.

7. Monitor and Review

Review and Update Plans

Record Key Milestones.
Monitor Performance.

3. Analyze Risks
Select Methods for Analyzing Risk.
Determine Likelihood, Consequences.
Estimate Level of Risk.

4. Evaluate Risks
Compare with Criteria
Set Risk Priorities.

5. Treat Risks
Identify Treatment Options.
Evaluate Treatment Options.
Select Treatment Options.
Prepare Treatment Plan.
Implement Treatment Plan.

Figure 4 – Risk Management Overview

To identify a best alternative, the Project Manager should carry out the steps below.

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 Specify the characteristics of apparently attractive alternative project concepts, and evaluate
each based on:
 Criteria specific to the project and its Owner, applying these to reduce the number of
alternatives needing detailed consideration;
Page | 9  Less tangible benefits and costs, such as reputation and environmental impacts;
 Risk analysis that identifies factors which may adversely or favorably affect the project
outcome.
 Assess all other project costs, including marketing, off-site services, municipal development
requirements, access, financing, etc.
If the project is straightforward, as for a utility-style building with little fast tracking, the Owner may
emphasize minimum acceptable quality and least cost for all products and services. On the other
hand, if there are high risks, or opportunities for innovative design, it is prudent to invest in
management, design and quality assurance from more experienced people.
Frequently, Owners need the certainty of knowing the project maximum cost; and this may be a
pre-determined amount. Attempting to achieve cost certainty simply by assigning all risks to others
may not be an effective strategy. A more prudent approach is to manage the project so as to
minimize risks and their consequences, and then assign each risk to the party best able to manage
it, and to allow time and cost contingencies for the problems that may occur.
1.2.4 Regulatory Management Strategy
A strategy should be developed by identifying potential conflicts between the project concept and
applicable regulations, and initiating resolution of the conflicts. Replanning may be needed to meet
regulatory conditions or to define project components that do not raise regulatory concerns. The
strategy should recognize that requirements vary between different jurisdictions, and lay out:
 the regulations which will be significant to the project,
 the responsibilities, including those of the registered coordinating professional, for undertaking
the needed involvement with regulators.

Project scope, quality, cost and schedule can be affected. The Project Manager, with assistance
from design professionals, should:
 Identify zoning limitations, development approvals for the jurisdiction in which the project is
located, and other regulatory requirements such as for parking, streets, and major roads, and
external obligations;
 Determine regulatory procedures and agency contacts, and give priority to processes with long
lead times for obtaining approvals;
 Assign responsibilities for coordinating interaction with the Regulatory Process and determine
the assistance and coordination offered by the municipality.

Direct discussion with municipalities and other regulatory authorities can assist coordination with
the regulatory process. Assigning a consultant familiar with the regularities is a great importance.

1.2.5 Business Plan (for the project)

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Market, operation and financial studies differ among sectors of the building industry and among
Owners. These studies are needed for a full evaluation of the project and then for effective
interaction with the Project Team. The Project Manager, through the Owner’s team, summarizes
the project concept, financing, risk, regulatory, schedule and insurance issues, based on the
proposed alternative(s). The business plan should cover the project and the subsequent building
Page | 10 use or sale. A main purpose is to determine the justification for a building-project and often to
enable comparison with competing uses for funds or land. The plan should:
 Define the project concept and preliminary objectives, budget and schedule.
 Identify the specific needs and constraints that will influence the identification of project
objectives and requirements.
 Analyze financing of full costs and benefits, cash flows, uncertainties and financing charges for
the project; full costs should cover marketing and other business support and overhead, even if
not to be accounted for as a project cost; (the analysis is often called a “pro forma”); financial
planning expertise is needed), Define the Owner’s project organization and assignment of
project roles.
 Involve the people who could introduce subsequent changes or delays, whether from inside or
outside the Owner’s organization.
 Be endorsed by all those who have a business or user interest in the project and whose
acceptance will later be needed for project construction; this reduces the possibility of
omissions in planning, which could lead to disruptive changes and could even jeopardize
project viability. When building users will not be identified until later, someone who is
knowledgeable of typical user requirements should represent their interests at this stage.

1.2.6 Pre-construction Financing

The preliminary budget should identify funds for the stages until construction will be committed.
The business plan should give a separate justification for the initial funds since the full project
justification is of course still based on preliminary information. Securing of financing to enable the
project to be fully developed in a timely manner is essential since project success depends on
orderly development. Funds can then be budgeted for the project development and preparation for
construction stages, and committed for each stage separately.

1.2.7 Approval to Develop Project (or not)

The Owner, on the recommendation of the Project Manager, has to decide whether to proceed
with, defer, modify or cancel the project. By proceeding the Owner decides to invest in project
development including preliminary design, with the expectation of proceeding to design
documentation and construction.

 Project Development Instruction

A full justification for the project is essential and clear instructions and authority should be given to
the Project Manager for developing the project and making decisions on behalf of the Owner.
These features may be combined into a project instruction to function as a mandate to develop the
project towards a defined construction completion date and total project cost, and recognizing the
regulatory environment under which the project will proceed. The Owner’s senior manager or

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higher authority should issue the mandate to the Project Manager (who should take part in its
preparation).
This formality reinforces proper business planning and accountability for the decision to continue
with the project, and reduces the potential for costly misunderstanding.
Page | 11 In deciding to proceed with the project, the Owner should give clear instructions for project
development and define the initial project organization. Instructions should:
 Be issued to and agreed with the assigned Project Manager, and approved at a senior level
within the Owner’s organization.
 Identify overall project objectives and needs of the Owner and users (more precise definition of
project objectives and requirements will continue during the project development stage); this
should include a preliminary project budget and master schedule consistent with the business
plan.
 Summarize how the Owner’s organization will interface with the project, including specific
practices for decisions, recommendations, approvals and other formal communication involving
the Owner and project team members.
 Authorize the Project Manager to assign all project team responsibilities; to proceed with
project development, subject to further approvals of the project, (the next approval may be on
completion of the schematic design); a plan for initiating the project and project team should
already be in place. Assignments may be to existing or newly hired staff, or by contract.

1.3 Management Problems during Business Planning

Many problems arise during this stage from disconnects between decisions and eventual project
implementation and use. An Owner may assign business planning to people who do not have
sufficient experience of what will follow. The Owner needs to select people with the capability to
prepare for management of the whole project.
Problems such as those itemized below typically occur when practices are omitted or are not
properly carried out or coordinated. This may reduce the success of any of the practices laid out
for this and subsequent stages, and may induce errors, omissions and disruptive changes.
 Comprehensive business and project planning may not be a condition for corporate approvals,
and assigned business responsibilities may not be well defined for a specific project. This may
lead to incomplete planning for this stage.
 Unclear or incomplete responsibility assignments can confuse and fragment business and
project planning. Project initiation without certainty of funding, authority or organization will add
to this problem.
 Assignment of a broadly qualified Project Manager may be considered unnecessary, so that
the overall leadership of the project may be insufficient for the crucial early planning.
 Many projects have got into trouble because of an insufficiently disciplined analysis and
decision process in determining project objectives and plans. The Owner should require the
same accountability from staff for timely work, reliable analysis and information, and firm
recommendations, as is expected from those providing services under contract.

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 The interests of eventual users and any buyer-Owners may not be represented when project
requirements are set. (There is consumer protection law for eventual Owners or lessees from
the open market, mainly for residential buildings).
 The user representation problem exists in a different form for a “build-to-suit” project, with a
specific buyer or lessee at pre-determined pricing. A developer may resist user requirements
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unless there is a price adjustment. The solution is to negotiate the requirements prior to signing
of the turnkey contract.
 The Owner may pre-determine financial, scope, quality, and timing objectives and constraints
for the project, without confirming them to be compatible. This is often the starting point of
projects that get into trouble. The relative priorities of long term building quality, project cost
and project completion date may then be unclear. Cost and schedule may be treated as more
important than quality to the detriment of the end product. , planning is likely to be less
thorough.

First-time Owners and those who build infrequently should especially consider concerns such as
the above.

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STAGE 2: PROJECT DEVELOPMENT

2.1 Organizing Project Development

Page | 13 This stage should define the project scope, timing, cost, risks and delivery method, sufficient to
produce a Master Project Plan. The Owner on the recommendation of the Project Manager should
approve these elements, in readiness for the ‘preparation for construction’ stage to proceed. The
Master Project Plan stems from the Project Business and Implementation Plans being elaborated
during the schematic design and design development. The Project Manager should coordinate
with applicable regulatory authorities to facilitate development approvals, re-zoning and
subsequent approvals. The Design Manager typically provides the main input.

Stage 2: Project Development

Prior Stage # 1: a Consultant Selection

Business Planning b Project Implementation Plan

c Site & Environmental Investigations

d Schematic Design & Design Development

e Quality Management Planning

f Planning for Risk & Project Delivery

g Master Project Plan

h Approvals for Development

Stage 3
Stage End: Approval to Project to Proceed Preparation for
Construction

Figure 5 - Project development Practices

2.1.1 Owner’s Senior Manager Role during Project Development

A senior manager should continue to be “sponsor” of the project by:
 Holding the Project Manager accountable for the ongoing success of the project;
 Providing user and Owner requirements for the development of the implementation and
summary plans, and approving these plans;
 Generating consideration of changes which later arise in the Owner’s or user’s requirements or
external influences on the project.

The senior manager and Project Manager should define how ongoing requirements and
information will be communicated in a timely manner, to and from the Project Team. Where
changes may be justified, their impacts on the project should be evaluated before specific

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instructions are issued. The Project Manager will be involved in some external changes, such as in
relation to permit conditions, but others will be the responsibility of the senior manager.

2.1.2 Project Manager Role during Project Development

The Project Manager, as agent of the Owner should keep overall leadership of the stage, and
Page | 14 should as a minimum lead the activities below.

 Organize the Project Team for setting Project Objectives, and for development, preliminary
design and preliminary construction planning.
 Direct preparation of the initial project plan to cover: project definition; Owner, regulatory and
user requirements; and needs of applicable community and other stakeholders.
 Ensure consistency among the preliminary design, the preliminary cost plan and funding plan,
the master schedule and the Owner’s expectations, including required project quality.
 Reach agreement with the Design Manager on the process for approving drawings and
specifications, and later the manufacture and construction of the building and its components
and systems. Agree, who will be the registered coordinating professional for the project.
 Direct the analysis and assignment of project and business risks.
 Guide project definition and requirements for the design, and approve site selection, the facility
program and each phase of the design, but excluding technical approval of the design
(responsibility of the Design Manager).
 Oversee interaction with the regulatory authorities to ensure that lines of communication are
established, with a clear mutual understanding of the required approvals and permits and their
timing.
 Direct a public involvement process if required by the Owner, or if the need for this is shown by
constraints and influences on the project identified in the municipal approval process.
 Oversee the selection of the project delivery method and the preparations for timely and
effective implementation, including the degree of emphasis on quality.
 Oversee comprehensive and timely project planning, with all required information and
expertise, for approval by the senior manager before beginning the preparation for construction
stage. As for all Owner involvement, keep the Owner appropriately informed and advised and
ensure that Owner’s decisions are expeditiously made.
 Plan the points throughout the project when approval will be required by Owner or Project
Manager, and set the criteria applicable to each.

2.1.3 Design Manager Role during project development

 The Design Manager has responsibilities as summarized below.
 Form and lead the design team, including specialist design consultants
 Provide input into definition of the Project Objectives and Project Plans with respect to design
issues, so that the preliminary design matches the Project Objectives.
 Assist the Project Manager to finalize the design requirements and to align the Owner’s
expectations with the budget and time needed to meet them. Substantial detail is usual for a

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complex facility, for which the instructions are often called a “Design Brief”. Design instructions
should be used to initiate the schematic design, design development and construction
documentation phases of the design, and be included in project plans. The Design Manager for
approval by the Project Manager usually prepares them, authorizing the scope of the design
prior to each phase.
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 Perform or assign and coordinate services, which must under regulations be carried out by
design professionals, including the registered coordinating professional. If there are multiple
consultant assignments directly with the Owner, coordination by the Design Manager is
essential to prevent confusion of the design responsibility chain.
 Manage the schematic design and design development, and necessary investigation work.
Oversee optimal and timely site and environmental investigations. Control the project scope in
accordance with the Project Objectives, giving clear instructions to designers to enable the
information required for adequate design to be obtained and utilized.
 Approve the technical content of the design drawings and specifications.
 Establish and apply quality standards for the design work, and specify or provide advice for the
quality of the end product. Develop and manage the quality assurance program for the design.

2.1.4 Construction Manager Role during project development

For a more complex project, or if special construction methods are possible, an experienced
construction advisor should be assigned at this stage.
This initiates the Construction Manager Role, which should be assigned to an experienced builder
preferably directly, but in same instances, as part of the Project Manager consultant’s team.

It is important that the design reflects available resources and materials, as well as ease of
construction. Construction Methodology, materials storage and delivery, and equipment usage
shall be discussed by the Construction Manager during this phase.

2.2 Practices during Project Development

2.2.1 Consultant Selection

The Project Manager and Design Manager retain consultants to complete the Project Team as
planned during the business planning stage.
Specific teamwork criteria should be stated in requests for proposals, and methods used to
evaluate proponents accordingly.
The attitude and priority given to quality in relation to cost and schedule are substantially set in this
stage.

2.2.2 Project Implementation Plan

It is important to have an approved Project Implementation Plan before starting the schematic
design. For an uncomplicated building, this may only need to cover the Project Objectives and
constraints and a “Functional Program” to provide authorization and guidance for the design.
These should be written as specifically as allowed by decisions and information available at the

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time. A Functional Program shall be prepared by the Design Manager based on the information
provided by the Client.
For larger or more complex structures the functional program extends to performance
requirements for systems and equipment. The term “facility program” is often used for such
buildings. Much interaction amongst planners and designers may be needed before all
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requirements are agreed. The process will be overseen by:
 The Project Manager, particularly if having special expertise of similar special-purpose
buildings from previous projects;
 The Design Manager, from the Project Manager’s staff; or,
 A consultant specializing in design and construction management for the applicable class of
buildings will be retained by the Project Manager or in some projects, by the prime consultant.
Requirements are typically defined for each system as performance requirements and for each
space as dimensions. These parameters should be used to prepare a corresponding preliminary
target cost estimate. Project scope changes may follow, to respond to evolving Owner or user
needs, to keep actual costs within a budget limit or to fully utilize available funds.
Performance specifications should optimize operation and maintenance costs and risks over the
life of the building.

2.2.3 Site and Environmental Investigations

Normally, the Project Manager will arrange site topographical surveys and authorize the prime
consultant to carry out environmental investigations. The latter should assist the management of
project risk. Extensive site investigation may increase certainty that there will be no unexpected
problems.

2.2.4 Schematic Design and Design Development

 Schematic Design including Site Finalization

This is the first design phase after the project is initiated. Its purpose is to develop an optimal
design concept to reflect the Owner’s project concept, and to obtain approval from the Owner.
Looking at alternatives is a way of drawing out potential innovations. If warranted by the design,
alternatives under consideration, more formal processes of design optimization and value analysis
may be utilized.
Before moving forward to the design development phase it is essential that areas of substantial
project risk be addressed. This entails finalization of the site, determination of its topography and
soil characteristics, and evaluation of environmental issues and zoning constraints. This phase
seals the design concept and no major changes to the concept should be introduced after this
stage.

 Design Development including Drawings for Development Approvals

Design development starts after the end of schematic design, and it completes the preliminary
design phases. It includes coordinated architectural, structural, electrical and mechanical designs,
and a comprehensive outline specification. Hence it should include finalized requirements for all
major systems and components within a well integrated design.

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The drawings developed at this stage are used for review with the applicable municipality. This
stage leads directly into the creation and finalization of the Construction Documents. The Design
Development Documents will be reviewed to verify that the entire approved Owner requested
elements are included in the design. For all intents and purpose the design of the structures is
fixed and early procurement and construction services can be released.
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2.2.5 Quality Management Planning
The quality management process consists of defining the required end product and then meeting
each of the requirements for achieving it. In each phase of the design there is added definition of
the quality required for the end product. Every party performing work on the project is obligated to
meet design, construction and other service requirements which contribute to the definition and
achievement of the required product quality.

The direct responsibility for producing the required quality of each system and component remains
with the applicable designer, construction contractor or other party doing work. The Owner may
choose to rely on these responsibilities and associated liabilities and may decide not to specify
additional quality assurance.

However, this can be a false economy because the majority of problems develop at the interfaces
between participants, and independent review can identify errors, gaps, and omissions that are
missed by the people doing a particular section of the work. The overall management of the
design is relegated to the senior or lead design firm. Overview of this function must be
accomplished as the design progresses and at each phase of the design completion.

Costs from failure of any party to meet their quality responsibilities may fall to a substantial extent
on the Owner, and project performance and completion objectives may be compromised. There
may be lost opportunities if designers and builders are not motivated to look for best solutions in
the interests of the project. Hence, there is growing understanding in the industry that minimizing of
fees and prices can be counter-productive where expertise is sought.

2.2.6 Planning for Risk and Project Delivery

Risk analysis and selection of project delivery method are linked activities having design and non-
design aspects. Since they depend on the Owner’s priorities and need for certainty, the Project
Manager should take the lead. Design and construction expertise are essential regarding potential
problems and their avoidance or solution.

The project delivery method affects the assignment and timing of design work. For example, if
design-build delivery is selected, the preliminary design should enable drawings to be issued at the
start of the next stage so that selection of the design-build contractor may be expedited and design
documentation can commence.

In the interests of achieving maximum value at minimum cost, the Owner should not assign risks
related to attributes of the land, nor assign any risks to people that cannot control them. However,
the Owner may best carry risks of floods or other extreme occurrences that cannot easily be

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foreseen. Builder’s All Risk Insurance must be in-place and maintained during the construction
process.

2.2.7 Master Project Plan

Master planning covers overall scope, costs, schedule and financing as well as quality
Page | 18 management, project delivery and assignment of risk.

The Project Manager should oversee the Master Project Plan and confirm its consistency with the
Project Objectives. Assistance should be obtained from the prime consultant, a representative of
the eventual users, and others responsible for components of the plan. Approval by the Project
Manager of the master schedule confirms the planned project completion date and intermediate
milestones. Approval of the Master Project Plan by the Owner’s Senior Manager should include an
instruction, developed with the Project Manager, to complete the project subject to identified further
approvals.
The budget and schedule prepared for the Implementation Plan should be updated with greater
detail. They may be based partly on summary activities and experience of other projects rather
than on detailed analysis.

2.2.8 Approvals for Development

The Project Manager should initiate liaison with municipal and/ or other authorities having
jurisdiction, in preparation for development and re-zoning approval applications, and for addressing
related issues. This lays groundwork for the subsequent building permit. The lead for interacting
with regulators and for coordinating the related work is typically assigned to the prime consultant. It
includes legal searches, land surveys and related registrations and permit applications.
Knowledge and advice relating to the requirements of the various jurisdictions is often provided by
the prime consultant or by a specialist. The Project Manager should coordinate or oversee any
public involvement.

2.2.9 Approve Project to Proceed or Cancel or Defer Project

Completion of internal approvals, and receipt of a development permit, should be pre-requisites for
a decision to proceed to the preparation for construction stage. Or confidence that unresolved
regulatory conditions will not cause major modifications, may justify starting the next stage,
including design documentation.
Changes in project justification or other business factors, or regulatory problems may cause the
Owner to defer, modify or cancel the project at this point. Later cancellation would write off much
larger costs. Therefore, the end of the project development stage is likely to be the last point at
which a project may be cancelled and the sunk investment still be justifiable as a feasibility
exercise.

2.3 Management Problems during Project Development

The problems discussed below are common. Although they typically arise during the project
development stage, many of them are likely to resurface later in the project.
The assignment of responsibility and risk is commonly at the root of many errors and omissions.
Experienced management is needed to motivate teamwork and to minimize later changes and
payment disputes.

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 Ineffective Direction by Owner

 Clear and comprehensive instructions about the Project Objectives may not be supplied to
designers, especially if the Owner does not have sufficient qualified staff available to develop
the Project Objectives, or if there is insufficient coordination with designers.
Page | 19  The importance of careful planning in this stage can be ‘drowned out’ by a perceived urgency
to obtain permits and to proceed with the project design and construction. The need to have a
Project Manager in overall charge of this stage may not be recognized, but it is imperative.
 The investment value of appropriate management and design may not be properly understood,
with project initial costs being an overly dominant factor when deciding whether to purchase
expertise. As a result, the potential value from the full life of the building may not be optimized
relative to its cost.
 Design documentation may be commenced prematurely, before the project definition is
sufficiently complete; if so, later changes and disruption are likely.

 Improper Management of Design and Non-design Services

 Taking a narrow view of one responsibility isolated in one time period may make shortcuts
appear immediately beneficial. However, it may threaten the success of the overall design, or
the next project stage or the whole project. Work may be divided up and assigned to specialties
without corresponding arrangements for coordination. Shortcuts include making expedient
design decisions in place of design optimization.
 Owners may select designers mainly on a lowest-price basis, making it less likely that superior
design services and optimal life-cycle building costs will be realized. Owners may not
understand that “basic compensation” covers only basic services and leaves gaps in the overall
assignment of responsibility.
 In the public sector it can be problematic to pre-qualify consultants or to award work other than
to the lowest bidder. However, it is becoming a more common agency requirement to purchase
management and design services by taking qualifications into account, or even making
selection based on qualifications alone with pricing then being negotiated with the best-
qualified proponent.
 Non-design services may be assumed to be part of a prime consultant’s capability, instead of
being assigned separately if the prime consultant does not have people with the required
qualifications. An inappropriate assignment stands in the way of comprehensive project
development.
 If the system for delivering design and construction is not ready for use, with information and
competent people available to apply it properly, a detrimental ad hoc approach may prevail
throughout the project. This problem is common on less successful projects.

 Inadequate Planning for Project Delivery

 Risk management and selection of project delivery method may be predetermined without the
characteristics and difficulties of the specific project being assessed by those with the
necessary expertise.
 An Owner may seek to transfer all risk by contracts onto managers, designers and construction
or trade contractors, and in so doing assign responsibilities for potential problems to parties

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who cannot control the problems, or who are not in a position to manage or carry the
associated risk.
 An Owner’s representative may be charged with responsibility to bring the project to completion
on time and within budget, in isolation from the responsibility of the designers for quality and for
compliance with regulations. This may create conflict between Owner and designer by giving
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inappropriate priority to savings of cost and time at the expense of meeting quality
requirements.
 Design and/or construction work may be fragmented by inappropriate use of multiple contracts
and fast-tracking without the required skilled coordination of a design and management firm.
This may create confusion at interfaces of design or trade specialties and can lead to errors
being undetected or uncorrected.
 Confusion over guarantees, liability and insurance may lead to inappropriate responsibility
assignment. There may be an incorrect expectation that project or construction managers, who
provide project direction for a fee, should guarantee performance of designers or construction
and trade contractors.
 Master scheduling of the project may inappropriately concentrate on the construction period in
isolation. There may be insufficient attention to the business and design decisions and
approvals which have a substantial influence on total project duration. These determine when
contracts can be tendered and awarded and whether subsequent instructions are timely and
free from changes.

 Flawed Management of Permits and Funding

 Preparations for submission and review of permit applications are complex. If these are not
well coordinated within the Project Team and with regulators this may delay permits and any
dependent financing.
 Securing of regulatory approvals may be regarded as the primary purpose of project
development. This can compromise the necessary emphasis on comprehensive definition of
the project and its delivery method.

 Confusion over Expectations

 Agreement to modify the scope of the project so as to accommodate budget limitations can be
made without original expectations being changed in the client’s mind. There may be customer
dissatisfaction when the building takes shape, and changes may become necessary to re-
establish expectations.

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STAGE 3: PREPARATION FOR CONSTRUCTION

In this stage, working drawings and other documents for construction are completed, and
Page | 21 construction plans approved so that all construction may commence.

3.1 Organizing Preparation for Construction

Stage 3 is treated as the start of project delivery, under all delivery methods.

Stage 3: Preparation for Construction

Prior Stage # 2: a Modify Design Team

Project b Technical Document for
Development Building Permit & Construction

c Quality Assurance Program

d Municipal Building Permit

e Financing for Construction

f Planning for Construction

g Procurement for Supply and Construction

Stage 4
Stage End: Construction “Go”, “No-Go” Decision
(Design-Build commitment to complete project may be at end of Stage 2) Construction

Figure 6 - Preparations for Construction Practices

The Design Manager Role is typically assigned to the prime consultant, while the parts of the
Project Manager and Construction Manager Roles are assigned in ways that depend on the
delivery method.
There may be substantial overlap between this stage and the follow-up construction stage, when a
fast-tracking approach is taken. Approval to commence construction and issue the initial trades
packages for tender is then followed by a sequence of approvals to issue documents for tender
corresponding to the sequence of trades.

3.1.1 Modify Design Team

Continuation with the design necessitates a larger design team. Its organization and accountability
depend on the selected delivery method.

3.1.2 Technical Documents for Building Permit and Construction

The design team should complete the technical documents for building permit and construction,
including supply of Owner’s equipment, furniture and fixtures. These design documents should
include specifications as well as working drawings, for acceptance by the Project Manager. Owner,

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designers, municipality, contract managers, planners, estimators, bidders, actual contractors and
others use the documents for various purposes.
The Owner, through the Project Manager, should continue to be involved in design choices of
importance to stakeholders. Timing of choices is crucial since even small changes made after
closure dates for drawing approvals can cause substantial redesign, and construction contracts are
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adversely affected if already awarded. The prime consultant should reach agreement with the
Project Manager on a document submission schedule covering all design disciplines and Owner’s
approvals.
This schedule should identify reviews and approvals, and letter of assurance and other
submissions to authorities having jurisdiction.
The preparation for construction stage requires design documentation up to and including working
drawings for bid invitations. More detailed parts of design documentation, such as shop drawings,
can be completed during construction.

3.1.3 Quality Assurance Program

The quality management plan approved during the project development stage should include a
quality assurance program for design and construction, to meet regulations such as for letters of
assurance and to the further extent required by the Owner. The prime consultant should initiate the
program. Design quality assurance becomes more extensive as the design progresses, and should
follow practices recommended by the design professions.

3.1.4 Municipal Building Permits

The Project Manager, often through the prime consultant, who prepares most of the required
documentation, applies for the building permit. Permit approval by the municipality is required prior
to start of construction.

3.1.5 Financing for Project Construction

The Owner should secure financing to match the cost plan for project completion. If no serious
problems have arisen during design documentation, this should be a formality. However,
confirmation of project validity is still needed:
 The cost consultant should update the estimate of probable construction costs with specialist in
estimating and construction.
 By using this information and by updating the assessment of project risks the Project Manager
updates the project budget, including contingency.
 The Project Manager should update the business plan as needed, for Owner’s Senior
Manager’s approval, and formally confirm financing for all planned costs.

3.1.6 Planning for Construction

This step covers construction planning needed prior to bid invitations and bid submissions. The
plan should be prepared jointly by the prime consultant and the Project Manager, for approval by
the Owner and should:
 Cover finalized project definition, performance requirements, cost, schedule, and contracting
plans, and supporting drawing and field review requirements.

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 Plan the assignments of all construction responsibilities and risks, partly by reference to the
actual contracts to be used.
 Involve the design team and cost, schedule and other specialists.
 Be validated or amended by bidders since their bids offer to complete on time.
Page | 23 Planned assignments should anticipate all requirements and potential problems. This includes
schedule management responsibilities, which should be assigned to people able to determine
status in comparison to the project and contract schedules, and to initiate corrective measures
when a schedule slips. Slippage in comparison to key dates needs to be recognized and analyzed
even when detailed activity sequences are rearranged, or when much work is presented as long-
duration activities.

3.1.7 Procurement for Owner Supplied Materials and Equipment

This comprises the bid and award of all supply, construction contracts, and supporting services
needed for construction. Bidding of major items may be dependent on construction approval per
the next heading. However, long lead times for major equipment may be protected before
construction is approved if there is a commitment to build the project once remaining preparations
are completed.

3.1.8 Construction “go”, “no-go” decision

The Project Manager recommends to the Owner’s Senior Manager that construction commence.
The main function of this approval gate is to make sure that preparations for construction are either
substantially complete or sufficiently advanced under a fast-tracking process, before moving
ahead.
A project should be cancelled at this point only under exceptional circumstances, since
accumulated costs are substantial. Nevertheless changes to the scheduled completion date may
be appropriate in response to market changes or in order to defer expenditures.

3.2 Management Problems during Preparation for Construction

Problems are more likely to occur when the defined scope of work is not firm.
 Owners may not provide sufficient funds for design working drawings, resulting in construction
drawings being incomplete and making shop drawing preparation more difficult and time
consuming during the construction stage.
 An overly optimistic budget for construction may necessitate re-design to reduce scope when
pricing is known, causing delay and possibly sub-optimal design.
 Fast-tracking of design and construction adds a level of uncertainty and may result in the initial
assumptions for the early design packages having to be revised later at increased cost.
Revisions can be made less likely by making early assumptions on the high side, for example
for structural loading from equipment still to be detailed. Nevertheless there is the potential for
changes to structural and other elements after construction has commenced.
A desire for cost certainty may result in plans to assign risks away from the Owner.

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STAGE 4: CONSTRUCTION

4.1 Organizing Construction

Through the above practices, construction is carried in accordance with the design requirements,
Page | 24 as detailed by construction, shop drawings, and specifications. Many of the practices in this stage
run concurrently.
The Site Supervision Consultant should coordinate the work to meet the time frame of the master
schedule and the details of the approved construction schedule. The prime consultant should

Stage 4: Construction

a Working Documents for Construction

b Regulatory & Construction Management Procedures

c Shop Drawing Preparation & Administration

d Supply & Construction, including

Supervision and Labor Relations
e Quality Control of Supply & Construction
f Construction Safety
g Administration of Contract Schedules,
Changes & Payments
h Construction Reviews including
Regulatory Requirements

Stage End: Building Ready to Commission

Figure 7 - Construction Practices

carry out the construction reviews and resolve all issues of quality and code compliance, enabling
letters of assurance to be signed.
Administration of contracts by or on behalf of the Project Manager is needed to confirm compliance
with requirements. It includes management of changes and payments. This contract administration
role needs to be established at this stage. It is to be noted that contract administration capability
should be a consultant selection criterion.

4.1.1 Working Documents for Construction

The prime consultant should complete and coordinate the construction drawings and instructions.
This includes clarification of any unclear, incomplete or apparently conflicting information in the
drawings and specifications. These may result in extra work, change orders, contract time
extensions or disputes. The specific involvements of prime consultant, Project Manager and
contract administrator depend on the delivery method. For each major division of the work,

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(architectural, structural, electrical, mechanical, plumbing and fire), a design professional must be
appointed “designer of record” with individual responsibility for the integrity of the design.
A schedule for construction drawing issue should have been part of the documents for
construction. The schedule is usually detailed and provided through the Prime Consultant Role and
then used by all parties for coordinating progress of all drawings.
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Deviations from the drawing schedule may impact the master schedule and should be monitored
by the Project Manager. Corrective action to make up time or re-negotiate the schedule may be
necessary.

4.1.2 Regulatory and Construction Management Procedures

The success of the construction stage depends on organized and timely processes. In general, a
minimum of variation is recommended from practices and related forms that are proven on building
projects.
The construction team needs to agree written procedures for the areas listed below, consistent
with applicable contracts (‘contractor’ indicates general or trade contractor as applicable).
Requirements for related permanent records need to be agreed.

 Design Coordination and Construction Reviews

(Agreed by Site Supervision Consultant, prime consultant and contractor)
 Transmittals for construction, shop, coordination, erection and construction engineering
drawings.
 Technical evaluation of changes.
 Communications such as frequency, attendance and agenda/ minutes for site coordination
meetings.
 Field review and inspection and testing requirements.

 Other Contract Administration

(Agreed by Site Supervision Consultant, contract administrator, contractor, and
subcontractor)
 Listing of (trade) sub-contractors and contact information.
 Extras, back charges, contemplated change notices, change orders, notification of disputes,
and process for emails, handwritten memos and other correspondence.
 Submission, monitoring and updating of construction and trade schedules, and issue of master
schedule updates.
 Receiving procedures for Owner-supplied equipment.
 Allocation of space for access, staging, lay down, offices, trade contractor use etc. and
revisions as space availability and needs change.
 Progress and final payments (likely based on a schedule of values which breaks down the
contract price), lien and performance holdbacks.

 Construction (established by contractor)

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 Documentation of Quality Control (QC) practices for own work and Quality Assurance (QA)
practices for monitoring subcontractors’ work, including contract requirements.
 Sub-trade coordination and safety of all workers
 Permit applications for work on public property and for work of various trades.
Page | 26  Purchasing and receiving procedures for contractor’s materials.

4.1.3 Shop Drawing Preparation and Administration

The preparation, submission and review of properly prepared shop drawings needs to be efficient
and timely for construction to proceed as scheduled. Confirmation that the project will be built as
designed is achieved as below.
 Shop drawings are specified under all of the building specification, under applicable codes, and
possibly under special conditions.
 Builders produce construction engineering and erection drawings.
 Coordination drawings may be drawn by the mechanical trade contractor or other contracted
party. These are required so that the locations of the various building services and components
are mutually compatible and that access, staging, lay down and office areas are coordinated
for all trades.

4.1.4 Construction Tracking

The Site Supervision Consultant should direct the construction stage, subject to limitations
imposed under the applicable contracts, and is accountable to the Project Manager. Actual
assignments and approval authority depend on the delivery method and this will affect the
construction procedures.
The construction team should include the builder(s), the prime consultant and other principal
consultants, major suppliers and the Project Manager’s contract administrator. Other consultants
and suppliers may be considered to be members of an extended team.
The Project Manager should organize pre-construction meetings for the construction team to lay
the groundwork for managing construction, including all of the documentation, coordination and
administration required.
The builders:
 Determine, control and coordinate the methods, sequence and timing of construction work and
supporting temporary services (i.e. utilities, temporary access roads, material handling and
storage, rigging etc.).
 Should be directly or, if subcontractors, indirectly accountable to the Project Manager for
performance as per contract.
 Must coordinate with the prime consultant to enable designers-of-record to ascertain whether
work is in accordance with the drawings and specifications.
Practices for supervision and labor relations for construction are well established by construction
and trade associations. Labor relations are highly sensitive to job safety and worker training.

4.1.5 Quality Control of Construction

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This is the direct responsibility of the applicable builders and through them their suppliers and
vendors, with additional inspection and testing arranged by the Site Supervision Consultant and
the Design Manager if required for the quality assurance program.

Responsibilities are as below.

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 Builders should implement quality control procedures, in order to meet the quality requirements
specified in their contracts; this is the direct control by tradesmen and supervision on how the
work is done.
 Builders hire qualified tradesmen and supervision.
 Specifications may require additional tests or inspections, for example mill test certificates and
strength and slump testing of concrete placed, under the direction of the prime consultant.
 The construction team should resolve any disputes about quality of work, through enforcement
of specifications, revisions to work methods, or changes in materials, etc., to meet the design
intent. If a dispute cannot be resolved in these ways, contract terms for dispute resolution are
to be implemented.

4.1.6 Construction Safety

Under the applicable standard contracts, general and trade contractors are responsible for
construction safety including all safety regulations for their work. Construction safety requires the
following:
 The Project Manager should assign overall responsibility for site safety, often in a general
contract. Otherwise the Owner can be liable for job safety. Where there are multiple contracts
or the Owner is constructing part of the work, safety responsibilities should be confirmed at the
start of construction. Satisfactory safety management should be a pre-requisite bidder
qualification.
 Builders must meet safety standards, as specified by government regulations, and by their
company safety practices. These should include preparation, implementation, and monitoring
of the safety plan and its job-site accident prevention and response methods.
 General and trade contractors should secure bonds or liability insurances, as specified by
regulations or terms in their contracts, or further coverage as desired.
 The builders should identify potential safety problems and implement solutions prior to being
directed by the Site Supervision Consultant and bringing up wider concerns at site safety
meetings.
 The Prime and other consultants should notify the construction team of any threat to safety
encountered during field reviews.
 Builders should coordinate with design professionals for the safety of formwork and
excavations, and the stability of structures and permanent equipment during construction.

4.1.7 Administration of Contract Schedules, Changes, and Payments

Each buyer under a contract needs to monitor performance by the seller and make appropriate
payments. On small projects, the Project Manager may act as the Owner’s contract administrator.
On larger projects the role is usually assigned, consistent with the delivery method. Financiers may

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require independent checks on progress, retaining a cost consultant. Each party to a contract
contributes to its administration.

A contract administrator originates and manages various documents, such as but not limited to
those listed under 4.1.2 above. Documentation responsibilities should be assigned among
Page | 28 technical, management and administration roles.

 Administration of Construction Schedules

All standard contracts require prime contractors to submit a construction schedule within a time
limit after award. The contract administrator should expedite schedule submission, partly through
pre-construction meetings, and on receipt should organize the review and acceptance of the
schedule, subject to applicable criteria. The accepted schedule should then be used for more
detailed planning of design and construction. Its purpose is to help identify the extent, causes and
required actions in relation to variances between planned and actual progress.

 Contract Changes
The Owner, Project Manager, designers, or builders may initiate changes in order to improve the
project scope or design. Alternatively, changes may be identified in the site soils, access, services,
or other contract provisions. External factors such as regulations or taxes may cause changes.
Regardless of how a change arises it is processed by the contract administrator in coordination
with others involved in determining the scope of the change. When changes are agreed,
adjustments are usually made to the contract price and the construction schedule.
It is usual for contract changes to affect administration of subcontracts which require similar
change provisions.

 Payments for Work in Progress

Part of the pre-construction meeting agenda is for the contract administrator and the corresponding
contractor representative to agree a schedule of values for determining monthly progress
payments. This subdivides all of the work and the contract price into categories that can be
measured. The quantity of work completed determines how much should be paid in each category
for each period. A separate accounting should be kept of change orders issued, and the progress
of work on each change for recognition in applicable progress payments.
The compilation of amounts to be paid should be organized so that payments to subcontractors
are determined as part of one process.

 Contractual Relations
The way in which the contract is administered may be seen either as fair or as standing in the way
of builders’ entitlements and enforcing contract terms in a biased manner. The contract
administration role is the basis in developing cooperation between Project Manager, prime
consultant, and builders. It is imperative that this basis is unbiased to avoid adversarial relations
which prevent effective teamwork.

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The Project Manager is involved in administrative decisions. Contract relations may be adversely
affected if construction contractors are reluctant to work towards fair resolution of problems,
especially if an effective dispute resolution process is lacking.
Appropriate solutions are more likely to be reached by those directly involved with the specifics of
a problem, and the need to refer decisions up the organizational hierarchy is limited. Negotiations
Page | 29
are ineffective if someone who is not a party to the discussion can overturn agreements later.
Alternatively, if one party is unable to be objective, or is not negotiating in good faith, then
escalation up the formal dispute resolution process may be necessary. If disputes are prolonged
when equitable solutions are available, they are likely to interfere with effective teamwork.
The best practice is that both parties to a contract should assign decision-making authority for
contractual problems to be resolved at the working level, up to a pre-determined maximum
amount.

4.1.8 Construction Reviews including Regulatory Requirements

This covers field reviews which are required by regulations to be performed by designers of record.
The applicable design professionals must be authorized to perform reviews to the extent
necessary for them to ascertain whether to sign a letter of assurance to the effect that the
constructed work conforms to the required codes. Design requirements are wider than those
covered by regulated codes so review is needed to assure that all design requirements are met.
This requires review of supplier’s work per the prime consultant’s discretion. Construction reviews
are summarized below.
 The site supervision consultant should review the quality of construction as required by the QA
program, which must recognize the building code and other regulations. The Project Manager
should verify the effectiveness of quality control by the builders and those inspecting and
testing the work to ascertain whether construction is completed in accordance with the design
documents.
 The Site Supervision consultant should arrange for appropriate consultant review the work
applicable to their discipline (using qualified personnel), and submit reports.
 In municipalities which recognize Certified Professionals (CP), such an individual may be
assigned to coordinate field reviews culminating in submission of a “Certification of Field
Review and Compliance” and “Application for Occupancy Permit”. The CP is required to carry
out specific duties and be present, for example, at specific commissioning tests.
 The construction team should resolve disputes related to deficiencies in a timely manner, or
enacts established dispute resolution procedures.

4.1.9 Building Ready to Commission

The Site Supervision consultant should initiate final inspections and deficiency reports and when
satisfied that work is sufficiently complete, recommends to the Project Manager that
commissioning proceed. All components should have been constructed as specified, but further
procedures are needed to verify that everything is fully operational.

4.2 Management Problems during Construction

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Problems under the following headings provide further warnings against making choices or
relaxing good practices to obtain short-term advantage, convenience or apparent deflection of risk.
Project success may be threatened as a result. Most of the problems can be minimized if
recommended practices are followed.

Page | 30  Schedule Management

Project monitoring, re-planning and on-time completion can be impeded by a number of
shortcomings. Common problems in assigning schedule management responsibility are as follows:
 Assignments may not be explicit about who is responsible to initiate corrective measures when
a schedule slips. For example, an Owner may assume this responsibility has been assigned to
the Site Supervision consultant when in reality only progress reporting has been specified.
 It may be clear that the Site Supervision consultant is responsible only to administer the
schedule, while the Owner keeps the authority to expedite the work or direct schedule
changes. Then, if the Owner does not appreciate the significance of schedule slippage, or does
not intervene, delays may accumulate which could have been minimized by identifying
responsibility. Conflict may result.
Parts of the solution enable comparison of plans to actual progress while there is still time for
remedial action if work is late:
 Dates for key progress points (milestones) are identified in the project master schedule which
is maintained through realistic updates.
 Schedule presentation identifies the planned and actual dates for milestones; this emphasis
enables the impact on the overall schedule to be readily appreciated and the timing and
sequencing of activities between milestones to be more flexible.
 Schedule management responsibilities, and the authority to initiate corrective action, are
completely assigned to qualified people, either in the Owner’s organization or through an
applicable contract with the Project Manager.
This approach assists accountability for progress with a minimum of interference in the running of
the work. However, not all builders see accountability as helpful.

 Responsibility for Management and Administration

Responsibilities for project management and contract administration services during construction
are not always clear. The applicable contracts need to define who is to carry out schedule
management, per previous heading, and the various aspects quality control and assurance,
administration of changes, time extensions, payment certification, organization of meetings, and
transmittal of drawings and technical instructions, etc.
Each of these assignments, whether to prime consultant, Site Supervision consultant, design-build
contractor, Project Manager or a specialist contract administrator depends on the delivery method
and its details. This is an area where supplemental conditions are often needed in a standard
contract to define the responsibilities for the specific project.

 Dispute Management
 Site coordination meetings may degenerate into ‘blaming’ sessions rather than producing
solutions to day-to-day difficulties in coordinating the work.

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 Slow resolution of claims and other disputes may lead to an accumulation of disputes, and
block co-operation and cause delays, cost overruns, and more claims. The easiest solutions
are reached by dealing with problems while they are fresh in people’s minds and the work can
still be observed.

Page | 31  Shop Drawings

 Requirements incompletely detailed on construction drawings; responsibilities inappropriately
assigned or not understood; poor scheduling and preparation and review of submissions.
 The construction documents may be incomplete and effectively require a vendor to complete
from ‘where the designer left off’. This is often connected to design fees having been set
unreasonably low and can cause more detailing difficulty than anticipated by budgets. Time
required to complete the excessive shop drawings is often not allowed for on the schedule, with
shop drawings often on the project’s critical path, especially for structural work. Time pressures
may induce errors and threaten quality.
 A general contractor may default on the responsibility to manage the shop drawing process
and rely on trade contractors to produce what is required. This can result in a loss of both time
and drawing quality creating pressure to lower drawing standards with record drawings (if
properly prepared) providing the only correct information.
 When vendors are inexperienced, which is more likely if selection has been based solely on the
lowest price without pre-qualification, they may not be aware of the standards for shop
drawings nor of actual shortcomings in design information.
 Lack of funding for shop drawing review may reduce incentive for reviewers to insist on
required standards or to undertake appropriate checks of drawings and calculations before
accepting shop drawings.

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STAGE 5: COMMISSIONING and COMPLETION

5.1 Organizing Commissioning and Completion
Page | 32 During this stage all specified performance and operating requirements should be confirmed, partly
for acceptance by the authorities having jurisdiction. The project can then be handed over to the
Owner for operation, although there may be minor deficiencies still requiring correction. A major
milestone is reached when the prime consultant certifies substantial performance of the work. This
initiates release of holdbacks to the general contractor and others.
The completion processes provide assurance that the project is technically successful. However,
success is only proven during actual operation of the building, and business success from the
project is determined by the building functionality, the proficiency of building operation, and the
validity of market assumptions.

5.1.1 Building Systems Start-up

This is overseen by the Design Manager and carried out by the applicable builders, with
supervision by designers of record and suppliers as applicable. The commissioning process is part
of the design responsibility for each building system, and correlates to operation requirements.
Commissioning functions as quality assurance and demonstration to the Owner that the building
functions and performs as intended.

5.1.2 Substantial performance

Inspection reports should be issued by the designers of record as a result of the findings from
commissioning. Corrections are performed by the applicable builders, subject to any validated
disputes about the deficiencies reported. Follow-up by the designers of record forms the final step
of field reviews and enables certification of substantial performance by the prime consultant (or
equivalent).
After substantial performance, lien holdbacks are released. Performance holdbacks are retained
sufficient to cover the cost of remaining corrections as estimated by the contract administrator.

5.1.3 Occupancy Permit

The coordinating registered professional should arrange issue of letters of assurance, signed by
each designer of record to the effect that the project has been constructed as designed. This is a
prerequisite for the municipality to issue the occupancy permit. An occupancy permit application
may be initiated by a Certified Professional.

5.1.4 Permanent Records

Documents for use during occupancy are part of the project requirements (product scope). These
include permits, record drawings, operation and maintenance manuals and any final reports
required by the Owner. Many documents used only during the project itself should be kept as
these are regarded as part of the record of development, design and construction processes.
Municipal regulations require record drawings from Coordinating Registered Professional or
Certified Professional.

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Contractors are usually required to prepare record drawings as part of their responsibilities. These
are for review by the prime consultant for completeness and then for use during occupancy. As-
built mark-ups of construction, shop and coordination drawings need to be maintained during the
work for record drawings to be complete and accurate. Unless actual locations of items embedded
in concrete or walls are drawn before they are covered up, record drawings will be incomplete.
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Some permanent records are needed for the certification of substantial performance, e.g. permits
and certificates these are Design Manager Responsibilities.
Operation and maintenance manuals for equipment and building systems are provided by
suppliers and contractors where specified. Many manuals are documents for equipment or building
components that are provided for many projects, e.g. roofs or boilers, but many must be
customized. The users are best served if the manuals are clear and organized and if special
training is provided for difficult items.
Certificates verifying the operation of various mechanical and electrical systems are required for
operation. Financial, correspondence, as-built progress and other historical records are assembled
per detailed agreements for documentation described in sub-section 4.1.
Requirements for permanent documentation are most effectively addressed during the preparation
for construction stage as part of construction specifications. The accuracy and completeness of
record drawings and documentation cannot be over-emphasized when considering their effect on
the operation and maintenance costs to be incurred during building occupancy.

5.1.5 Handover to Property Management

Building handover involves the transfer of care, custody and control of the building to the users, as
well as contractual completion. When substantial performance of the project has been certified by
the prime consultant, and the occupancy permit received, the Project Manager accepts the project
on behalf of the Owner. This may be subject to deficiencies and any other outstanding items, but
these do not delay the handover for occupancy. The Owner has the right to retain sufficient money
to cover the cost of the outstanding items and should do so.
Training of users and property managers should be clearly defined either as part of the project or
as part of operation. It should be linked to the preparation and timing of operation and maintenance
manuals, which are usual parts of the project scope.
The contract administrator and builders should initiate supplier warranties and occupancy period
insurance when applicable project components are in service.

5.1.6 Financial and Administrative closure

This step consolidates the closure of design and construction contracts. It includes completion of
builder’s lien administration, resolution of disputes except for any still bound up in formal resolution
processes, filing of job records, certification of final payments to contractors, and completion of the
permanent project documentation.

5.1.7 Project Review for Lessons Learned

This activity has proven to be most challenging to implement on all kinds of projects. Hurry to
proceed to the next project, concerns about blaming sessions, and lack of preparation all
contribute to lessons being retained only as individual experience rather than being organized into
recommendations for improvements.

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For lessons to be assimilated, a process of record and note-keeping needs to be planned and
monitored. This is only likely to happen if each project participant assigns an individual as
responsible to monitor and compile significant experiences. Design changes, schedule slippage
and cost overruns, records of quality and other problems and their solutions are all possible
documentation with which to facilitate the recognition of the significant variances between plans
Page | 34 and actual should be examined for the lessons they reveal. A formal debriefing is recommended.
Skilled facilitating may be needed to maintain an environment of learning rather than criticism.
However, many lessons will be about good ideas that should be repeated.

5.1.8 Closure of One-year Warranties

Most manufacturers’ warranties are for one year. During the warranty period the property manager
should follow the requirements of the operating and maintenance manuals and is likely to identify
any problems with operation of the building systems. Any resulting warranty call backs will have
made any identified repairs, and a warranty inspection by the Owner or prime consultant at the end
of warranty periods and correction of new or outstanding problems, should be precedent to closure
of the warranties.

5.1.9 Final Project Acceptance by Owner

There is an arbitrary aspect to the determination of when a building project is totally complete.
Physical completion including satisfaction of problems under warranty, and financial completion of
contracts may be considered to be part of the project. Total physical completion of a project is
often elusive, and the prime consultant usually does not certify total completion. Total financial
completion may be deferred for years if there are disputes which cannot easily be settled.
As a datum, however, a project may be considered totally complete when:
 all deficiencies are corrected,
 all one-year warranties have been satisfied, and
 all contracts have been closed except for specifically identified disputes.
For the datum, completion is taken as one year after substantial performance. This generally
coincides with the end to the prime consultant’s role on the project.
Longer term warranties, such as for water-tightness of the building, remain in effect. However, it is
common for the Owner to issue a final acceptance about a year after substantial performance. This
does not remove the rights of the contracting parties.

5.2 Management Problems during Commissioning and Completion

These involve the handling either of problems which have developed but not been solved during
the project, or of difficulties in achieving total project completion.
 Delays to final approval and occupancy can arise due to a lack of coordination on the design
team during the prior stages of the project. A common shortcoming is a failure of the electrical
and mechanical systems to work together and satisfy the Building Code requirements for fire
and life safety.
 Inadequate building operation and maintenance instructions from designer and builder to
Owner and to others may leave users unprepared. This may be precipitated by users’ time not

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being expected or planned prior to handover. A solution is to identify handover items in project
and operating plans.
 Once holdbacks have been released the incentives to complete remaining deficiencies are
reduced. A holdback may be kept for rectification of deficiencies but this sometimes provides
too little incentive for contractors and their sub-trades to give priority to total completion of their
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work. It may be necessary to expedite this work in addition to holding back money until
performance is complete. This can cause project completion to be continually deferred.
The Owner, with due notice, may need to arrange for completion by others and pay for the
work out of the deficiency holdback.
 Co-operation between contracting parties over dispute resolution may have broken down,
especially if costly problems occurred during the work that one party claimed should be solved
at the expense of the other. This may have resulted in financial settlement being deferred to
the end of the job. The difficulty of resolution increases as disputes accumulate and interact,
possibly including claims for costs of making up lost time. Formal dispute resolution processes,
whether through the courts or by alternative methods, can be time consuming and expensive.
 Marginal performance should be identified as a way of anticipating possible future problems,
and only deferral of only minor deficiencies should be allowed as the work progresses.
Completion on-time and within budget, and acceptance for project handover, do not guarantee
a trouble-free occupancy period.
 Formal assimilation of lessons learned is regrettably uncommon. This may be connected to the
absence of a review process during and at the end of the project, because people are too busy
with the current project or in starting the next, or may expect embarrassment from reviewing
problems, or see insufficient value in doing so. The more successful the project, the more
willing people are to review their participation in it.

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STAGE 6: OCCUPANCY
6.1 Initial Responsibilities for Occupancy Period
Page | 36 During project development, Section 2.2, options should be included for the Owner to occupy the
building or to lease or sell it to others. However, lease or sale is not considered part of the project.
There may be some design modifications needed during the typical one-year warranty period, prior
to total project completion. These could necessitate construction or remedial work and associated
coordination and could involve users as well.

6.2 Management Problems Evident during Occupancy

A physical or financial failure is likely to have management as well as technical causes. Such
failures often occur during occupancy but reflect on the prior management of the project. They
indicate failure to meet the objectives for a building that lasts both physically and operationally.
During occupancy, the success of a project is more thoroughly tested than is possible during
commissioning. The design structural, mechanical or electrical loading may not be applied for
some years, if at all. Design loading for seismic or other special load conditions may only be
reached during a major event. Actual business conditions affect operational success.

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