Construction management
Encyclopedia
Construction Project Management is the overall planning, coordination and control of a project from inception to completion aimed at meeting a client’s requirements in order to produce a functionally and financially viable project that will be complete mingement (CPM) is project management that applies to the construction sector (3rd Forum ”International Construction Project Management” 26th/27 June 2003 in Berlin).
The Construction Management Association of America (CMAA) (a primary US construction management certification and advocacy body) says the 120 most common responsibilities of a Construction Manager fall into the following 7 categories: Project Management Planning, Cost Management, Time Management, Quality Management, Contract Administration, Safety Management, and CM Professional Practice which includes specific activities like defining the responsibilities and management structure of the project management team, organizing and leading by implementing project controls, defining roles and responsibilities and developing communication protocols, and identifying elements of project design and construction likely to give rise to disputes and claims.
UK: 1. management of the site. 2. form of delivery
USA: form of delivery (compare above)
Real estate management (REM):
professional property advice (as opposed to a project, REM is a continuous process)
Corporate real estate management (CREM): REM focused on a company’s property
Management contracting (MC):
UK: form of delivery
USA: CM at risk
Programme management (ProgM):
UK: 1. programme management is concerned with managing time in a project and is thereby part of the CPM function. 2. management of a client’s portfolio (client’s programme in this sense is equivalent to a client’s brief)
USA: management of a client’s portfolio (compare above)
Project control (PC): The PC function is concerned with gathering data regarding project progress, producing progress reports, monitoring time, cost, and quality. Compared to the CPM function, the PC function can be characterised to be passive, whereas a construction project manager needs to take action.
Project leader (PL): The PL is responsible for achieving the project’s objectives. He is the manager “in line”.
Project director (PD): The PD is the leader of a big project that can be broken down in sub-projects (e.g. Channel tunnel). He can also be the head of a PM organisation.
OR: The OR is the representative of the owner. This function can be provided either internally or externally.
DC: Document Control - A key function of a Project Manager.
FBOT: finance build operate transfer
BOT: build operate transfer
DBOT: design build operate transfer
BOO: build own operate
EPC: engineering procurement construction
PFI: private finance initiative
GC: general contractor
GMP: Guaranteed maximum price
MPC: multiple prime contracts:
UK: one contractor takes responsibility for the development (package deal)
USA: a client may have 5 or 6 prime contractors
, operations management
engineer degree, doctor of philosophy
degree, postdoctoral researcher
); on-job-training; and continuing education / professional development. For information on degree programs, reference ACCE, the American Council for Construction Education, or ASC, the Associated Schools of Construction.
According to the American Council for Construction Education (the academic accrediting body of construction management educational programs in the U.S.), the academic field of construction management encompasses a wide range of topics. These range from general management skills, to management skills specifically related to construction, to technical knowledge of construction methods and practices. There are many schools offering Construction Management programs, including some that offer a Masters degree.
or engineer
), the builder (usually called the general contractor
). Traditionally, there are two contracts between these parties as they work together to plan, design, and construct the project. The first contract is the owner-designer contract, which involves planning, design, and construction administration. The second contract is the owner-contractor contract, which involves construction. An indirect, third-party relationship exist between the designer and the contractor due to these two contracts.
An alternate contract or business model replaces the two traditional contracts with three contracts: owner-designer, owner-construction project manager, and owner-builder. The construction project management company becomes an additional party engaged in the project to act as an advisor to the owner, to which they are contractually tied. The construction manager's role is to provide construction advice to the designer, on the owner's behalf, design advice to the constructor, again on the owner's behalf, and other advice as necessary.
technology has enabled much of the ability of contractors to maintain tight construction time
There are two main advantages to using a design-build contract. First, the construction team is motivated to work with the design team to develop a design with constructability in mind. In that way it is possible for the team to creatively find ways to reduce construction costs without reducing the function of the final product. The owner can expect a reduced price due to the increased constructability of the design.
The other major advantage involves the schedule. Many projects are given out with an extremely tight time frame. By letting out the contract as a design-build contract, the contractor is established, and early mobilization and construction activities are able to proceed concurrently with the design. Under a traditional contract, construction cannot begin until after the design is finished, the project is bid and awarded, and the team can mobilize. This type of contract can take months off the finish date of a project.
The major problem with design-build contracts is the inherent conflict of interest. In a standard contract the designer is responsible to the owner to review the work of the builder to be sure the products and methods meet specifications and codes. The builder as a construction professional experienced working with many designers is attuned to picking up design flaws which would go uncaught or unmentioned when builder is also designer. The owner may be more likely to get a building that is over-designed in order to increase costs and profits for the design-builder, or built with lesser grade products to maximize profits. If time is of the essence, a design and construction contracts can be awarded separately, with bidding taking place on preliminary plans in a not-to-exceed contract in lieu of a single firm design-build contract.
Comprehensive management of every stage of the project, beginning with the original concept and project definition, yields the greatest possible benefit to owners from Construction Management. As time progresses beyond the pre-design phase the CM's ability to effect cost savings diminishes. The Agency CM can represent the owner by helping to select the design team as well as the construction team and manage the design preventing scope creep
, helping the owner stay within a pre-determined budget by performing Value Engineering, Cost/Benefit Analysis and Best Value Comparisons.
(GMP), in most cases. The construction manager acts as consultant to the owner in the development and design phases, (often referred to as "Preconstruction Services"), but as the equivalent of a general contractor during the construction phase. When a construction manager is bound to a GMP, the most fundamental character of the relationship is changed. In addition to acting in the owner's interest, the construction manager must manage and control construction costs to not exceed the GMP, which would be a financial hit to the CM company.
CM at risk is a global term referring to a business relationship of Construction contractor, Owner and Architect / Designer. Typically, a CM At Risk arrangement eliminates a "Low Bid" construction project. A GMP agreement is a typical part of the CM and Owner agreement somewhat comparable to a "Low Bid" contract, but with a number of adjustments in responsibilities required by the CM. The following are some of the potential benefits of a CM At Risk arrangement:
Budget management: Before design of a project is completed ( 6 months to 1½ years of coordination between Designer and Owner), the CM is involved with estimating the cost of constructing a project based on the goals of the Designer and Owner (design concept) and the overall scope of the project. In balancing the costs, schedule, quality and scope of the project, decisions can be made to modify the design concept instead of having to spend a considerable amount of time, effort and money re-designing and/or modifying completed construction documents. For instance, if the Owner decides to spend more money or obtain more funding for the project, adjustments can be made to the project more cost-effectively without having to complete construction documents as a predecessor to pricing. To manage the budget before design is done, construction crews are mobilized, the CM is often spending significant resources each week with onsite management, major items are purchased, etc., etc., is a much more efficient use of everyone's time, effort, Architect / Designer's costs, and the CM's General Conditions costs, AND delivering to the Owner a design within his budget.
The Construction Management Association of America (CMAA) (a primary US construction management certification and advocacy body) says the 120 most common responsibilities of a Construction Manager fall into the following 7 categories: Project Management Planning, Cost Management, Time Management, Quality Management, Contract Administration, Safety Management, and CM Professional Practice which includes specific activities like defining the responsibilities and management structure of the project management team, organizing and leading by implementing project controls, defining roles and responsibilities and developing communication protocols, and identifying elements of project design and construction likely to give rise to disputes and claims.
Functions
The functions of construction project management typically include the following :- Specifying project objectives and plans including delineation of scope, budgeting, scheduling, setting performance requirements, and selecting project participants.
- Maximizing resource efficiency through procurement of labor, materials and equipment.
- Implementing various operations through proper coordination and control of planning, design, estimating, contracting and construction in the entire process.
- Developing effective communications and mechanisms for resolving conflicts
Terminology
Construction management (CM):UK: 1. management of the site. 2. form of delivery
USA: form of delivery (compare above)
Real estate management (REM):
professional property advice (as opposed to a project, REM is a continuous process)
Corporate real estate management (CREM): REM focused on a company’s property
Management contracting (MC):
UK: form of delivery
USA: CM at risk
Programme management (ProgM):
UK: 1. programme management is concerned with managing time in a project and is thereby part of the CPM function. 2. management of a client’s portfolio (client’s programme in this sense is equivalent to a client’s brief)
USA: management of a client’s portfolio (compare above)
Project control (PC): The PC function is concerned with gathering data regarding project progress, producing progress reports, monitoring time, cost, and quality. Compared to the CPM function, the PC function can be characterised to be passive, whereas a construction project manager needs to take action.
Project leader (PL): The PL is responsible for achieving the project’s objectives. He is the manager “in line”.
Project director (PD): The PD is the leader of a big project that can be broken down in sub-projects (e.g. Channel tunnel). He can also be the head of a PM organisation.
OR: The OR is the representative of the owner. This function can be provided either internally or externally.
DC: Document Control - A key function of a Project Manager.
FBOT: finance build operate transfer
BOT: build operate transfer
DBOT: design build operate transfer
BOO: build own operate
EPC: engineering procurement construction
PFI: private finance initiative
GC: general contractor
GMP: Guaranteed maximum price
MPC: multiple prime contracts:
UK: one contractor takes responsibility for the development (package deal)
USA: a client may have 5 or 6 prime contractors
Study and practice
Construction Management education comes in a variety of formats: formal degree programs (one-year associate degree; four-year baccalaureate degree, masters degree, project managementProject management
Project management is the discipline of planning, organizing, securing, and managing resources to achieve specific goals. A project is a temporary endeavor with a defined beginning and end , undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value...
, operations management
Operations management
Operations management is an area of management concerned with overseeing, designing, and redesigning business operations in the production of goods and/or services. It involves the responsibility of ensuring that business operations are efficient in terms of using as little resources as needed, and...
engineer degree, doctor of philosophy
Doctor of Philosophy
Doctor of Philosophy, abbreviated as Ph.D., PhD, D.Phil., or DPhil , in English-speaking countries, is a postgraduate academic degree awarded by universities...
degree, postdoctoral researcher
Postdoctoral researcher
Postdoctoral research is scholarly research conducted by a person who has recently completed doctoral studies, normally within the previous five years. It is intended to further deepen expertise in a specialist subject, including acquiring novel skills and methods...
); on-job-training; and continuing education / professional development. For information on degree programs, reference ACCE, the American Council for Construction Education, or ASC, the Associated Schools of Construction.
According to the American Council for Construction Education (the academic accrediting body of construction management educational programs in the U.S.), the academic field of construction management encompasses a wide range of topics. These range from general management skills, to management skills specifically related to construction, to technical knowledge of construction methods and practices. There are many schools offering Construction Management programs, including some that offer a Masters degree.
Business model
Typically the construction industry includes three parties: an owner, a designer (architectArchitect
An architect is a person trained in the planning, design and oversight of the construction of buildings. To practice architecture means to offer or render services in connection with the design and construction of a building, or group of buildings and the space within the site surrounding the...
or engineer
Engineer
An engineer is a professional practitioner of engineering, concerned with applying scientific knowledge, mathematics and ingenuity to develop solutions for technical problems. Engineers design materials, structures, machines and systems while considering the limitations imposed by practicality,...
), the builder (usually called the general contractor
General contractor
A general contractor is responsible for the day-to-day oversight of a construction site, management of vendors and trades, and communication of information to involved parties throughout the course of a building project.-Description:...
). Traditionally, there are two contracts between these parties as they work together to plan, design, and construct the project. The first contract is the owner-designer contract, which involves planning, design, and construction administration. The second contract is the owner-contractor contract, which involves construction. An indirect, third-party relationship exist between the designer and the contractor due to these two contracts.
An alternate contract or business model replaces the two traditional contracts with three contracts: owner-designer, owner-construction project manager, and owner-builder. The construction project management company becomes an additional party engaged in the project to act as an advisor to the owner, to which they are contractually tied. The construction manager's role is to provide construction advice to the designer, on the owner's behalf, design advice to the constructor, again on the owner's behalf, and other advice as necessary.
Design, bid, build contracts
Design, bid, build describes the prevailing model of construction management in which the general contractor is engaged through a tender process after the designs have been completed by the architect or engineer.Design and build contracts
Recently a different business model has become more popular. Many owners – particularly government agencies have let out contracts which are known as Design-Build contracts. In this type of contract, the construction team is known as the design-builder. They are responsible for taking a concept developed by the owner, completing the detailed design, and then pending the owner's approval on the design, they can proceed with construction. Virtual Design and ConstructionVirtual Design and Construction
Virtual Design and Construction is the management of integrated multi-disciplinary performance models of design-construction projects, including the product , work processes and organization of the design - construction - operation team in order to support explicit and public business objectives...
technology has enabled much of the ability of contractors to maintain tight construction time
There are two main advantages to using a design-build contract. First, the construction team is motivated to work with the design team to develop a design with constructability in mind. In that way it is possible for the team to creatively find ways to reduce construction costs without reducing the function of the final product. The owner can expect a reduced price due to the increased constructability of the design.
The other major advantage involves the schedule. Many projects are given out with an extremely tight time frame. By letting out the contract as a design-build contract, the contractor is established, and early mobilization and construction activities are able to proceed concurrently with the design. Under a traditional contract, construction cannot begin until after the design is finished, the project is bid and awarded, and the team can mobilize. This type of contract can take months off the finish date of a project.
The major problem with design-build contracts is the inherent conflict of interest. In a standard contract the designer is responsible to the owner to review the work of the builder to be sure the products and methods meet specifications and codes. The builder as a construction professional experienced working with many designers is attuned to picking up design flaws which would go uncaught or unmentioned when builder is also designer. The owner may be more likely to get a building that is over-designed in order to increase costs and profits for the design-builder, or built with lesser grade products to maximize profits. If time is of the essence, a design and construction contracts can be awarded separately, with bidding taking place on preliminary plans in a not-to-exceed contract in lieu of a single firm design-build contract.
Planning and scheduling
Project management methodology:- Work breakdown structure
- Project network of activities
- Critical path method (CPM)
- Resource management
- Resource leveling
Architecture–Engineer
- Work inspection
- Change orders
- Review payments
- Materials and samples
- Shop drawings
- 3d image
Agency CM
Construction Cost Management is a fee-based service in which the Construction Manager (C.M) is responsible exclusively to the owner and acts in the owner's interests at every stage of the project. The construction manager offers advice, uncolored by any conflicting interest, on matters such as:- Optimum use of available funds;
- Control of the scope of the work;
- Project scheduling;
- Optimum use of design and construction firms' skills and talents;
- Avoidance of delays, changes and disputes;
- Enhancing project design and construction quality;
- Optimum flexibility in contracting and procurement.
- Cash flow Management.
Comprehensive management of every stage of the project, beginning with the original concept and project definition, yields the greatest possible benefit to owners from Construction Management. As time progresses beyond the pre-design phase the CM's ability to effect cost savings diminishes. The Agency CM can represent the owner by helping to select the design team as well as the construction team and manage the design preventing scope creep
Scope creep
Scope Creep in project management refers to uncontrolled changes or continuous growth in a project's scope. This phenomenon can occur when the scope of a project is not properly defined, documented, or controlled...
, helping the owner stay within a pre-determined budget by performing Value Engineering, Cost/Benefit Analysis and Best Value Comparisons.
CM at-risk
CM at-risk is a delivery method which entails a commitment by the construction manager to deliver the project within a Guaranteed Maximum PriceGuaranteed Maximum Price
A Guaranteed Maximum Price contract is a cost-type contract where the contractor is compensated for actual costs incurred plus a fixed fee subject to a ceiling price...
(GMP), in most cases. The construction manager acts as consultant to the owner in the development and design phases, (often referred to as "Preconstruction Services"), but as the equivalent of a general contractor during the construction phase. When a construction manager is bound to a GMP, the most fundamental character of the relationship is changed. In addition to acting in the owner's interest, the construction manager must manage and control construction costs to not exceed the GMP, which would be a financial hit to the CM company.
CM at risk is a global term referring to a business relationship of Construction contractor, Owner and Architect / Designer. Typically, a CM At Risk arrangement eliminates a "Low Bid" construction project. A GMP agreement is a typical part of the CM and Owner agreement somewhat comparable to a "Low Bid" contract, but with a number of adjustments in responsibilities required by the CM. The following are some of the potential benefits of a CM At Risk arrangement:
Budget management: Before design of a project is completed ( 6 months to 1½ years of coordination between Designer and Owner), the CM is involved with estimating the cost of constructing a project based on the goals of the Designer and Owner (design concept) and the overall scope of the project. In balancing the costs, schedule, quality and scope of the project, decisions can be made to modify the design concept instead of having to spend a considerable amount of time, effort and money re-designing and/or modifying completed construction documents. For instance, if the Owner decides to spend more money or obtain more funding for the project, adjustments can be made to the project more cost-effectively without having to complete construction documents as a predecessor to pricing. To manage the budget before design is done, construction crews are mobilized, the CM is often spending significant resources each week with onsite management, major items are purchased, etc., etc., is a much more efficient use of everyone's time, effort, Architect / Designer's costs, and the CM's General Conditions costs, AND delivering to the Owner a design within his budget.
Regulation
In the UK the industry is regulated though Construction Design Management regulations, which prevent incidents on construction sites and civil engineering structures once they are completed.Further reading
- Halpin, Daniel W., Construction Management, Wiley, Third Edition.