CONSTRUCTION

PROJECT
MANAGEMENT

Prepared By:
DAN GERICO L. BACANI
Supervising Engineer A
CONSTRUCTION PROJECT MANAGEMENT
What is Project Management ?
The management of construction projects requires knowledge of modern management as well
as understanding of the design and construction process. Construction projects have specific
set of objectives and constraints such as required timeframe.
Generally, project management is distinguished from the general management of corporations
by the mission-oriented nature of a project. A project organization will be terminated when
the mission is accomplished.
Project Management is the art of directing and coordinating human and material resources
throughout the life of a project by using modern management techniques to achieve
predetermined objectives of scope, cost, time, quality and participation satisfaction.
The basic ingredients tor a management framework is represented schematically in Figure A. A
working knowledge of general management and familiarity with the special knowledge domain
related to the project are indispensable. Modern management practices and various special
knowledge domains have absorbed various techniques or tools which were once identified
only with the supporting disciplines. Hence, the representation in Figure A reflects only the
sources from which the project management framework evolves.

FIGURE A: Basic Ingredients in Project Management

Specifically, project management in construction encompasses a set of objectives which may

be accomplished by implementing a series of operations subject to resource constraints.
Subsequently, the functions of project management for construction generally include the
following:

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 1. Specifications of project objectives and plans including delineation of scope,
budgeting, scheduling, setting performance requirements, and selecting
project participants.

2. Maximization of efficient resource utilization through procurement of labor,

materials and equipment according to prescribed schedule and plan.

3. Implementation of various operations through proper coordination and

control of planning, design, estimating, contracting and construction in the entire
process.

4. Development of effective communications and mechanisms for resolving

conflicts among the various participants.

Project Management focuses on nine distinct areas requiring project manager knowledge and
attention:
1. Project integration management to ensure that the various project elements
are effectively coordinated.

2. Project scope management to ensure that all the work required (and only the
required work) is included.

3. Project time management to provide an effective project schedule.

4. Project cost management to identify needed resources and maintain budget

control.

5. Project quality management to ensure functional requirements are met.

6. Project human resource management to development and effectively employ
project personnel.

7. Project communications management to ensure effective internal and

external communications.

8. Project risk management to analyze and mitigate potential risks.

9. Project procurement management to obtain necessary resources from

external sources.

1.2 Organization of Project Participants

The top management sets the overall policy and selects the appropriate organization to take
charge of a proposed project. Its policy will dictate how the project life cycle is divided among
organizations and which professionals will be engaged. Decisions by the top management will
also influence the organization to be adopted for project management.

Since construction projects may be managed by a spectrum of participants in a variety of

combinations, the organization for the management of such projects may vary from case to
case.
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 FIGURE B: A Matrix Organization

FIGURE C: A Project-Oriented Organization

On one extreme, each project may be staffed by existing personnel in the functional divisions of the
organization on an ad-hoc basis as shown in Figure B until the project is completed. This arrangement is
referred to as matrix organization as each project manager must negotiate all resources for the project
from the existing organizational framework. On the other hand, the organization may consist of a small
central functional staff for the exclusive purpose of supporting various projects, each of which has its
functional divisions as shown in Figure B. This decentralized set-up is referred to as the project oriented
organization as each project manager has autonomy in managing the project.

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The project manager, in the broadest sense of the term, is the most important person for
the success or failure of a project. The project manager is responsible for planning,
organizing and controlling the project. In turn, the project manager receives authority
from the management of the organization to mobilize the necessary resources to
complete a project.

The project manager must be able to exert interpersonal influence in order to lead the
project team. The project manager often gains the support of his team through a
combination of the following:

Formal authority resulting from an official capacity which is empowered to issue

orders.

Reward and/or penalty power resulting from his capacity to dispense directly or
indirectly
valued organization rewards or penalties.

Expert power when the project manager is perceived as possessing special

knowledge or
expertise on the job.

Attractive power because the project manager has a personality or other

characteristics
to convince others.

1.4 Interpersonal Behavior in Project Organizations

While a successful project manager must be a good leader, other members of the project
team must also learn to work together, whether they are assembled from different
divisions of the same organization or even from different organizations. Some problems of
interaction may arise initially when the team members are unfamiliar with their own roles
in the project team particularly for a large and complex project. These problems must be
resolved quickly in order to develop an effective, functioning team.

Many of the major issues in construction projects require effective interventions by

individuals, groups and organizations. The fundamental challenge is to enhance
communication among individuals, groups and organizations so that obstacles in the way
of improving interpersonal relations may be removed. In very large projects, professional
behavior scientists may be necessary in diagnosing the problems and advising the
personnel working on the project. The power of the organization should be used
judiciously in resolving conflicts.

The major symptoms of interpersonal behavior problems can be detected by experienced

observers, and they are often the source of serious communication difficulties among
participants in a project. For example, members of a project team may avoid each other
and withdraw from active interactions about differences that need to be dealt with. They
may resent suggestions for improvement, and become defensive to minimize culpability
4 of 10achievements. All these actions are detrimental
rather than take the initiative to maximize
While these symptoms can occur to individuals at any organization, they are compounded if the
project team consists of individuals who are put together from different organizations.
Invariably, different organizations have different cultures or modes of operation. Individuals
from different groups may not have a common loyalty and may prefer to expand their energy in
the directions most advantageous to themselves instead of the project team.

2.0 Fundamental Scheduling Procedures

2.1 Relevance of Construction Schedules

In addition to assigning dates to project activities, project scheduling is intended to match the
resources of equipment, materials and labor with project work tasks over time. Good scheduling
can eliminate problems due to production bottlenecks, facilitate the timely procurement of
necessary materials, and otherwise insure the completion of a project as soon as possible. In
contrast, poor scheduling can result in considerable waste as laborers and equipment wait for
the availability of needed resources or the completion of preceding tasks. Delays in the
completion of an entire project due to poor scheduling can also create havoc for owners who
are eager to start using the constructed facilities.

Attitudes toward the formal scheduling of projects are often extreme. Many
owners require detailed construction schedules to be submitted by contractors as a means of
monitoring the work progress. The actual work performed is commonly compared to the
schedule to determine if construction is proceeding satisfactorily. After the completion of
construction, similar comparisons between the planned schedule and the actual
accomplishments may be performed to allocate the liability for project delays due to changes
requested by the owner, worker strikes or other unforeseen circumstances.

In contrast to these instances of reliance upon formal schedules, many field supervisors disdain
and dislike formal scheduling procedures. In particular, the critical path method of scheduling is
commonly required by owners and has been taught in universities for over two decades, but is
often regarded in the field as irrelevant to actual operations and a time consuming distraction.
The result is "seat-of-the-pants" scheduling that can be good or that can result in grossly
inefficient schedules and poor productivity. Progressive construction firms use formal
scheduling procedures whenever the complexity of work tasks is high and the coordination of
different workers is required.

Formal scheduling procedures have become much more common with the advent of personal
computers on construction sites and easy-to-use software programs. Sharing schedule
information via the Internet has also provided a greater incentive to use formal scheduling
methods. Savvy construction supervisors often carry schedule and budget information around
with wearable or handheld computers. As a result, the continued development of easy to use
computer programs and improved methods of presenting schedules have overcome the
practical problems associated with formal scheduling mechanisms. But problems with the use of
scheduling techniques will continue until managers understand their proper use and limitations.

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A basic distinction exists between resource oriented and time oriented scheduling techniques.
For resource oriented scheduling, the focus is on using and scheduling particular resources in an
effective fashion. For example, the project manager's main concern on a high-rise building site
might be to insure that cranes are used effectively for moving materials; without effective
scheduling in this case, delivery trucks might queue on the ground and workers wait for
deliveries on upper floors. For time oriented scheduling, the emphasis is on determining the
completion time of the project given the necessary precedence relationships among activities.
Hybrid techniques for resource leveling or resource constrained scheduling in the presence of
precedence relationships also exist. Most scheduling software is time-oriented, although
virtually all of the programs have the capability to introduce resource constraints.

3.0 PERT / CPM

PERT (Program Evaluation Review Technique) and CPM (Critical Path Method) were developed
independently in the later part of the 1950’s. These two are networks used for planning and
coordinating large scale projects.

PERT / CPM is a control tool for defining the parts of construction job and then putting them
together in a network form. It serves as an aid to the construction manager but it does not
make decisions for him nor does it guarantee good management. PERT / CPM only serves the
Project Manager to see the whole picture of the entire job. It encourages periodic re-evaluation
and providing an accurate measure of progress. Thus, a person in charge of each work and the
project manager know what supposed to happen and when it is supposed to happen.

3.1 PERT / CPM Project Requirements

In all major projects of the governments, PERT / CPM network is a mandatory requirements.
Under RA 9184, the “Government Procurement Reform Act” for government infrastructure
contract provides that:

The program of work shall include, among other things, estimates of the work, items, quantities
and costs and a PERT / CPM network of the project activities… In the preparation of the bidding
documents, the agency shall make an estimate of the actual number of working days required
to complete the project through PERT / CPM analysis at the project activities and corrected for
holidays and weekends.

3.2 Three Phases of PERT / CPM

The three phases of PERT / CPM are:

1. Planning
2. Scheduling
3. Control – Monitor

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Planning

Planning is defined as determining the relationship between the work operation and the
sequence in which they are to be performed. The PERT / CPM offers the solution through
systematic approach. The specific information provided by the CPM are as follows.

1. PERT / CPM pinpoints the particular work operations whose completion times
are responsible for controlling the complete date.
2. It provides a means of speeding up a project without excessive costs for
overtime.
3. It gives a time leeway or float available for each of the non-critical work
operations. The information of float time will give the project manager that
opportunity to maneuver in their planning and control of the operations.
4. It establishes time boundaries for operations with possibilities of shifting
resources, equipment and manpower to meet time requirements.
5. PERT / CPM indicates the earliest starting dates for each work operations and
sub-contracts for supply and delivery of materials.
6. It shows the most advantageous scheduling for all operations. This gives
planning information as to time and cost in choosing methods, equipment,
crew and work hours.
7. It offers a means of assessing the effect on the overall project variations in one
operation such as change orders.

In any project construction undertaking, planning is the most important considerations which
must include the following:

1. Gathering all the necessary input data to make the PERT/CPM works.
2. Planning phase is the main work of the contractor for being familiar and
knowledgeable of his costing methods of doing business.
3. The contractor can seek assistance for the accomplishment of work particularly
the gathering of data, but his basic responsibility on this matter cannot be
delegated to any outsider.
4. The contractor has the complete perception, experiences, resources, and
interest in getting the project done in the best possible time and cost.
5. The planning stages give the contractor a ‘dry run’ on the construction of the
project.
6. If the contractor wants an effective approach and use of the construction
management , he must do it himself.
7. By performing the work personally, one obtains intimate first hand knowledge
of the job and gain insight and details of anticipated problems.

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Scheduling

In PERT/CPM, scheduling is defined as the process of translating the arrow diagram into time
table of calendar days. This is done by the day date table converting working days into calendar
days which permits the inclusion of weekends, holidays, weather and other time lost.

The PERT / CPM schedules shows the relationships between the operations and the leeway
limitations. All activities should be checked with the day to day table. All crew and management
restraints along the critical path should be verified and the restraints should be adjusted to give
satisfactory project completion. Non-critical activities can be scheduled to more efficiently
utilize manpower and available resources.

Job control through the use of PERT/CPM gives the management a reliable system identifying
job problems within days instead of months. The diagram must show the status of the project at
long time and indicate which activities can be started and to pinpoint the course of the delay.

The PERT/ CPM diagram should be updated periodically to a account for:

1. Time discrepancies
2. Deliveries
3. Weather
4. Change Orders
5. Unexpected events or conditions.

Updating the diagram is based on the number days the project is out of schedule.

Controlling and Monitoring

Flexibility and updated re-computations brought about by changing conditions
is the key to a successful network programming. To keep the schedule more up to date and
meaningful it must have the following output.

1. The contractor is supplied with time status report showing the overall status of
the project in general.
2. The contractor is provided with revised schedules which reflect the actual work
conditions and the project status.
3. The contractor is supplied with cost status reports showing how much money
is being disbursed for what type of expenses.
4. The contractor should be supplied with those reports as frequently as desired
or required to maintain control over the project.

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In the planning phase, there are five inputs that can be obtain:

1. A network diagram defining the activities in the project.

2. The duration of the project.
3. Cost estimates of the activities for monitoring cost, cash flow requirements.
4. Resource estimates.
5. Trade indicators (responsibility) for activity grouping.

From the Schedule phase, there are four output that can be obtained:

1. The schedule of activities in the network showing the following:

a. The critical activities
b. The Earliest Start date for each activity
c. The Earliest Finish ate for each activity
d. The Latest Start date for each activity
e. The Latest Finish date for each activity
f. The Float which refers to the amount of extra time available for
an activity.

2. A Bar Chart or a Time Scaled Network ( arrow diagram network for the project)

3. A Resource Analysis showing the number and kind of resources, manpower,

equipment and others that are required for each day of the project.

4. A Cash Requirement prediction indicating how much cash to be disbursed for

the job and the amount of money that will be collected as a result of work
accomplishment.

The Control Monitor Phase uses actual data which includes:

1. Addition to the project – this refers to new activities

2. Deletion from the project

3. Changes as to duration, description, trade indicators, cost estimates or

resource estimates.

4. Actual starting dates

5. Actual finishing dates

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4.0 Crashing and Time/Cost Tradeoffs
Activity durations can often vary depending upon the type and amount of resources that are
applied. Assigning more workers to a particular activity will normally result in shorter duration.
Greater speed may result in higher costs and lower quality, however.

A simple representation of the possible relationship between the duration of an activity and its
direct costs is shown in Figure D. Considering only this activity in isolation and without reference
to the project completion deadline, a manager would undoubtedly choose a duration which
implies minimum direct cost, represented by D3 and C3 in the figure. Unfortunately, if each
activity was scheduled for the duration that resulted in the minimum direct cost in this way, the
time to complete the entire project might be too long and substantial penalties associated with
late project start-up might be incurred. This is a small example of sub-optimization, in which a
small component of a project is optimized or improved to the detriment of the entire project
performance. Avoiding this problem of sub-optimization is a fundamental concern of project
managers.

C1

C2

C3

D1 D2 D3

FIGURE D: Illustration of a Linear Time/Cost Tradeoff for an Activity

At the other extreme, a manager might choose to complete the activity in the minimum
possible time, D1 but at a higher cost C1. This minimum completion time is commonly called the
activity crash time. The linear relationship shown in the figure between these two points implies
that any intermediate point may represent the ideal or optimal trade-off between time and cost
for this activity.

What is the reason for an increase in direct cost as the activity duration is reduced? A simple
case arises in the use of overtime work. By scheduling weekend or evening work, the
completion time for an activity as measured in calendar days will be reduced. However,
premium wages must be paid for such overtime work, so the cost will increase. Also, overtime
work is more prone to accidents and quality problems must be corrected, so indirect costs may
also increase.

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