Week 1 Lecture

Subject Overview
 Management of cost, time and quality from a site perspective
 Covers numerically based techniques that assist in resource management
 Does not deal with the management of human resources as considered from the psychological or
sociological standpoint

Course Content
 Productivity improvement
- method study
- work measurement
 Time management
- intro to project planning
- understanding of critical path scheduling
- develop your own plan for a project
 Site management
- labour
-subcontract labour
- materials
-plant and equipment
 Cost control
 OHS and site safety
- regulations
- Risk management approach
- practical site safety
 Industrial relations
- project team
- role of unions
- Contemporary IR
 Quality management
- history
- quality assurance
- effect of QA at site management level
- identifying quality requirements

Assignments
 2 assignments, based on site visits, done in pairs (encouraged, but don’t have to – recommended
though)
 Hard copies handed in in the lecture, but keep a copy
What Is Management
 The process of organising and controlling resources in order to meet certain goals or objectives
 Includes an abundance of techniques appropriate in particular circumstances
 May also often involve the concept of synergy

Why manage and plan?

 Management and planning techniques help to reduce variability and uncertainty
- planning forces a better understanding of the project
- earlier this occurs in a project = more likely chance of rational decisions made

Management of Construction
 Building development process is made up of two distinct activities
- design/documentation
- construction
 Skills and functions required in each stage are different
 = the more time goes by
means less influence
over the cost

Management of
construction stage is SO
IMPORTANT in terms of
cost

Management during construction

 Approx. 80% of project costs are expended during construction
 Management at this stage in terms of organisation, monitoring and control is critical

Project Procurement Outline

 Project risks
 Project procurement (delivery) strategies (contractor doesn’t have much of a choice in this, more the
client)
- the client would choose one method over another usually due to minimising risk
 Contractual arrangements

Client Goals
 Every client has a particular goal for the project, if not met the impact on the client organisation is
significant
 Each project is unique and has its own risks and uncertainties
 Projects can fail because of:
- separated functions
- scope creep (clients keep wanting more, designers take this as a requirement and so may not do their
job as well as they should – not good at distinguishing between wants and needs)
- project acceleration (speeding up is usually better and has a positive psychological effect but if too fast
= incomplete documents and things need to be redone etc.)
- poor relationships (between client and builder or designer etc.)
- external environment

Project Risks
General - financial
- time
- design
- quality
Client organisation - organisational risks (levels of experience and involvement)
- financial
Project specific - external (political, socio-political and economic)
- project itself (complex and technical)
Minimising Risk
 Client must monitor the entire process
- devise mechanisms to ensure client goals are met
 Client must select project team whose skills match project needs
- reduced risk
- how this team interacts depends on the procurement route and contract strategy used

Procurement Routes
= the client’s approach to organising the project team that will manage the entire design and construction
process
- selection process governed by risk but also the client goals and project characteristics (also known as delivery
method)
THREE COMMON STRATEGIES
= traditional, design/construct and management (construction management and management contracting)

Traditional
 Client hires consultants
 Documentation is completed
 Consultants paid a fee (either fixed or a % of projected
project costs)
 Owner selects main contractor via competitive tender or by
negotiation
 Main contractor responsible for execution of works

 also
more transparent = good, but takes longer and can
be more expensive
NOVATION = between design & construct. Start
traditional – works for client then works for
builder

Design & Construct

 Came up in the 1990s from the industrial sector

 Single point of responsibility
 Firm hired to perform both design and construct
- in house expertise
- joint venture
 Client needs to be experienced to gain best results
Two management approaches:

Management Contracting Construction Contracting

^ different levels of risk management

 Contracts

= Agreement between 2 parties in which one agrees to perform a

particular or service in exchange for something (consideration) in
return

 Requires offer and acceptance

 Involves some form of consideration e.g. money
 Formalises arrangement between parties
 Both parties agree to conditions

Types of contracts
1. Single fixed price (or lump sum, or hard money)
- contractor agrees to provide specifies amount of work for a specific sum
- often used with traditional delivery methods i.e. Well defined scope with minimal variations
- where work not fully detailed provisional sums included – schedule of rates may be better if these are
excessive
- owner is aware with reasonable accuracy of what the project will cost
- contract only as good as accuracy of documentation
- minimises risk for clients – contractor takes all the risk but also all the savings
2. Unit price/ schedule of rates
- nature and scope known – but quantities indefinite
- contractor includes unit rate in bid for each item
- as quantities measured contractor is paid
- overheads and profit included in rates
- good for projects that are complex and its difficult to quantity the work necessary
- if quantities are different to estimated then the client takes this risk, but they also keep any savings
- final price not known until last invoice prepared
3. Cost plus fee (prime cost contracts)
- contractor is reimbursed by client for all work costs (including admin) and also receives a fee
(equivalent to a profit)
- e.g. Federation square
- client must clearly define what will be reimbursed and what’s covered by fee
- profit guaranteed
- allows work to proceed as design develops
- good where scope difficult to define
- encourages collaborative work in design construct contracts
- often used with GMP (e.g. CAP)

Fees
 Vary to offer different incentives to contractor
- % of estimated or actual cost
- fixed fee
- variable purchase
- fee fixed with bonus and penalty provisions
- fee based on GMP
 Client gets all or some of any savings and builder takes some or all of the risks (GMP)
- like project procurement it’s important to choose the right one for the client as it also addresses project risk
- select the one that will purchase the construction service for the best place within acceptable levels of risk
 Week 2 Lecture- Site Management
Intro to site management
= Addresses a range of issues relevant to the establishment and management of construction sites with an
emphasis on:
 Site safety
 Site planning and layout
 Materials handling
 Equipment selection
 Industrial relations

Think of a site like a product but one that has to be dismantled at the end

Timeline =
 Before construction begins, most of the work for site management is determined in the most effective
and efficient manner
 It begins during the tendering stage, where a budget neds to be allocated for site management issues
 One of the end products of site management is called the site layout plan

Roles and Responsibilities

e.g. Site Manager responsibilities =

 Be familiar with site procedures

 Deal with site induction processes
 Keep and maintain site records
 Understand procedures regarding
permits
 Be computer literate
 Understand basic programme
techniques

Occupational Health & Safety

WHS (work health and safety) management plan
 Useful for contractors and sub-contractors and is a requirement of projects over $250 000
 Done in accordance with Work Health And Safety Act 2011 and Work Health And Safety Regulations
2011
 Includes:
- WHS roles and responsibilities
- SWMS checklist
- site induction checklist
- plant hazard checklist
- plant and equipment register
- incident report form
- emergency plan