Construction Phase

Important because:

(i) The quality of the completed project is highly
dependent on the workmanship and management
of construction
(ii) Majority of the total project budget and schedule is
expanded during construction phase
(iii) More time and cost in construction imply that any
delay or cost variance will have greater effect on
the project
Construction Phase
Quality of construction depends on:
(i) Completeness and quality of contract
documents
(ii) Skilled labourers who have the skills
necessary to produce the work
(iii) Field supervisors who have the ability to
coordinate the numerous activities
(iv) Quality of material and appropriate tools
and equipment that are used for construction
(v) Effective management of the skilled
workers and schedule and cost
Construction Phase
Objective of construction:
To build the project in accordance with
the plans and specifications and within
budget and on schedule and to the
satisfaction of the owner
To achieve the objective, there are
three assumptions:
Assumptions for construction phase
(1) Scope: The design plans and specifications
contain no errors and meet the owners
requirements and appropriate codes and
standards.
(2) Budget: The budget is acceptable: i.e. it is
what the owner can afford to pay and what the
contractor can build it with a reasonable profit.
(3) Schedule: The schedule is reasonable. i.e.
short enough to finish when the owner needs it,
but long enough for the contractor to do the work
The above assumptions are reasonable but in
practice they are often variances due to the
nature of construction work.
Bidding or Tendering
Prequalification of prospective
contractors or bidders
Evaluation criteria:
Records of experience
Financial capability
Safety records
General character and reputation in the
industry

Tendering
Open tender or closed tender
Advertisement for invitation to tender
Bid bond or tender deposit to be provided during
submission of tender.
Bid bond is refundable to the unsuccessful contractors.
For competitive bidding, obtain 3 to 5 bids
Generally, the more the bids the more competitive the
bidding i.e. lower bid price. However quality of bidders
is more important the quantity.
Bid period must be reasonable to ensure adequate time
for the contractors to prepare proposals ( bids)
Too short some may decline
Too long unnecessary delay in construction
Methods of Tendering
Open Tendering
An open invitation to contractors
through newspaper or journal
Advantage is competitive price
Disadvantage is indiscriminate request
for open tender may lead to poor
quality work
Contractors are sometimes ill-
equipped, financially unstable or lack
the experience to take up the job
Methods of Tendering
Selective Tendering
Contractors are short listed and invited to
submit quotations
Lists of contractors are either recommended by
the consultants or invited to submit
prequalification to tender
Contractor chosen is usually the lowest bid
Proper control of tenders to ensure that they
are qualified in terms of experience, financially
sound and have technical experience to
undertake the job
Methods of Tendering
Negotiated or closed tendering
Under the contract, time factor is
important
Technical drawings and bill of quantity
(BQ) are not prepared and the extent
of the contract is not yet defined
Continuation of the project of repetition
of existing contract may be desirable
Tendering
Addendum ( or addenda)
Changes in bid package during the tender period to
correct errors, clarify requirement or make changes
Too many addenda --- frighten the bidders, create
doubt, create risk in the mind of bidders thus
increase bid price
Pre-bid conference
Clarify any unique aspect of work
Explain special working conditions
Answer questions of contractors
All clarification at the meeting, not in the bid
documents should be confirmed in writing to all
bidders (use addenda)
Bid opening
Closed or open
Must have proper procedure to
record
Normally attended by the owner
Award of contract
Letter of intend or letter of award
Signing of contract
Engineers Instruction to start work
Performance Bond, CAR, Contractor
all risk insurance and third party
liability

Performance Bond
Usually 10 % of contract amount
Performance bond is a three-party instrument in
which a bonding company ( termed surety)
guarantees ( or bonds) to the owner that the
project will be build by the contractor in
accordance with the contract. If for any reason,
the contractor becomes unable or unwilling to
complete the contract, the surety will take steps
to engage another contractor to complete
contract or other steps specified in the
instrument. The cost of performance bond
depends on the size and risk of the contract and
the reputation and expertise of the contractor.
Engineering Instruction (EI)
The Engineering may from time to time issue further
drawings, details or written instructions related to:
The variation works (VO)
Discrepancy between the contract documents
Removal from site of any materials brought in by the
contractor
Removal of any person employed by the contractor who
has misconducted himself
Removal or re-execution of any works executed by the
contractor
Opening up for inspection of work covered up
Making good of any defect during the defect liability
period
Any matter which the Engineer is empowered by the
contract to issue instruction for the good of the works
Variation Order (VO)
Any changes during construction may be
instituted through variation order in writing
The changes may be for the following:
Increase or decrease the quantity of any work
included in the contract
Omit any such work
Change the character or quality of any such work
Change the level, line position and dimensions of
any part of the works
Execute addition work of any kind necessary for the
completion of the works
Clarify discrepancy between contract documents
Dispute Resolutions
Due to nature of construction projects it is
almost certain that contractor, owner and
designer will be involved in disputes
There are four(4) methods of resolution of
disputes:
Direct negotiations
Mediation
Arbitration
Litigation
Direct Negotiations
Direct negotiation between parties in dispute
Quickest and most economical
Factual matters are discussed without the
formality of legal formats
Negotiator for each party must have authority to
act for his company
Success of the negotiation depends on the
willingness of both parties to negotiate in good
faith
Can enhance good business relationships between
the parties


Mediation
Used when direct negotiation failed
Use an independent, objective person to assist in
resolving the dispute
Mediator has no authority to issue a final decision
Mediation is voluntary
Mutual agreement to have the mediator to serve
as a catalyst to explore alternative solutions
To gather facts, clarify discrepancies and to
persuade the parties to adopt flexibility in their
stance
Arbitration
It is similar to mediation except the arbitrator has the
authority to issue a final binding decision that cannot be
appealed by the disputing parties
Submission of a dispute to a mutually agreed impartial third
party whose decision is legally binding and enforceable
Arbitration clause is provided in the Conditions of Contract
5 steps procedure
Agreement to arbitrate
Selection of arbitrator
Preparation of hearing
Hearing of disputes
The award
Decision by the arbitrator is made within 30 days from the
close of the hearing
Litigation
Resolution of disputes by lawsuits
Adopt the legal formality of the court
system
Most costly, time consuming and complex
method for resolution of dispute
Legal counsels who follow the formality of
the legal judicial system are used to
represent the interest of the parties
Fianl resolution of dispute is determined
by a court of law
Extension of time
Contractor must apply through written notice of the
causes of delay when work is going to be delayed
Engineer will have to consider granting extension of
time
Engineer shall estimate the length of the delay beyond
the completion date and approve in writing a fair and
reasonable extesion of time
Extension of time can be granted based on the
following reasons
Force majeure this means any event which happens
beyond the control of man
Exceptional inclement weather this refers to the
weather condition which deviates from the normal annual
weather trend.
Loss or damage occasioned by fire, lightning, explosion,
storm, flood, ground subsidence etc.
Extension of time
Any instruction given by the engineer provided such
instructions are not issued due to any default of the
contractor or his subcontractors.
Contractor not having received in due time from the
engineer necessary instructions, drawings, levels
etc
Delay in giving possession of site
Action due to strike, affecting any trades employed
by the works
Delay on the part of the artisans, trademen or other
engaged by the employer
Contractors inability to procure any material for
reason beyond his control which he could not
reasonably have foreseen at the closing of tender
Delay on the part of the nominated supplier
Quality Control
Quality control is part of a quality
assurance program that has for many
years been recognized as the inspection
and testing of materials and workmanship
to see that the work meets the
requirements of the drawings and
specifications
Quality is the responsibility of all parties,
though principal responsibility is placed
on the contractor
Quality Control
What can we do to pass quality control?
What can we do to get pass inspection?
What can we do to finish the project that
we can be proud of that meets the
specifications and satisfies the owner?
Without right attitude, even the best
planned quality-control program cannot
be successful
Major objectives of Quality Control
To ensure the completed work meets
the specifications
To reduce customers or clients
complaints
To improve the reliability of products or
work produced
To increase customers or clients
confidence
To reduce production costs
Evolution of quality control
Inspection
A process of checking what is produced is what is
required
Two forms --- quantifiable e.g. level, dimensions, or
open to interpretation e.g. cleaniness, safety

Quality control by sampling
Involve inspection to stages in the development of
goods and services to ensure that they are carried
out to satisfy requirements
Done on sampling basis dictated by statistical
methods e.g. taking cube tests



Evolution of quality control
Quality assurance
Emphasize defect prevention
To ensure that specifications are consistently
met.
Fit for Purpose and Right first time are the
principles of quality assurance
ISO 9000 (BS 5750) certification
Document of quality control process and
always follow the process to ensure
consistency of product i.e ensure that quality is
built into the production sustem
Evolution of quality control
Total quality management
Based on the philosophy of continuously improving of
quality of goods or services and customer satisfaction
Everyone in the company should be involved and
committed
TQM ensures that its goods and services meet the
following criteria:

Be fit for purpose on a consistently reliable basis
Delight the customer with the service
Quality of product is so much better than the competitors that
customers want it regardless of prices
There is a mechanism for continuous improvement on the
quality of goods
Job site safety
Safety is an important part of project management just
as are planning, scheduling, estimating, cost control
and other project work
Concern of safety must be shown at all levels and each
phase of the project
Accidents not only affect workers but also their families
The economic costs, liability consequences, regulatory
requirements and the image of a company all show the
importance of safety related to a project
Construction, by the nature of the work, involves
manay potential hazards to workers and equipment,
such as heat, noise, wind, dust, vibrations and toxic
chemicals

Job site safety
The Occupational Safety and Health Administration
(OSHA) was enacted by the Federal Government as a
regulatory agency to ensure safety of workers
It applies to all parties involved in the project
Project manager must work closely with his team
members to include safety in every aspect of the
project
Safety should start at the top level of an organisation
and by words and actions, be infused in each level of
management through to the workers at the job site
Accident costs include medical costs premiums for
compensation benefits, liability and property loss and
delay, (cost of loss time)
Safety and productivity are two related parts for higher
job performance. The safer the workers, the quicker
they work, the higher the productivity
Common causes of accident
Negligence of workers
Unsafe working conditions
Improper erection of scaffolding
Inadequate safety precautionary measures such
as warning sign, barricades, safety belt etc.
Insufficient lighting
Indifference to safety rules and regulations
Failure to check the safety of handing equipment
Inexperience workers
Inadequate design

Steps to prevent accidents
Institute job site safety by management and monitoring
safety as part of the requirement of the project management
Form safety committee to monitor the safety requirements at
site
Install adequate warning signs and lightings
Use of safety gears at the site
Briefing / training of safety requirement to all workers at site
Regularly check and maintain the handling equipment in safe
working order
Maintain order and cleanliness at site
Follow proper design and erection procedure for scaffolding
Adopt good / standard engineering codes of practices in
construction