Construction Management

For Civil Engineering

CE 462

Lecturers:
Dr. S. Oduro-Kwarteng
Dr. Obeng-Atuah
Department of Civil Engineering,
Kwame Nkrumah University of Science and Technology, KNUST, Kumasi

January 2015

Preface
Civil engineering projects are most often complex and the construction engineer or
manager has to deal with complex task and project instructions from the commencement
of the project to completion. He must be up to the task and produce construction documents
which detail what has to be done at all stages of the work. These instructions and
Civil Engineering Dept. KNUST

information need to be concise, informative and put in a well-organized form for

construction site management. Site management of construction works embodies the
production planning, instructions, day-to-day management, and control of construction
works on site.

The main parameters of construction project that require control are time, cost and
quality/performance. These parameters must be managed by the construction engineer
for successful completion of the construction project. Any student in Civil Engineering
requires knowledge of construction management of civil engineering projects.

This teaching material is mainly concerned with the site management of civil engineering
construction works. This material will be of help to practicing young civil engineers who
want to develop a career in site management of construction works. A young civil engineer
working with a consulting firm can be called upon to supervise contractors executing site
construction works. On the other hand a young civil engineer working with a contracting
firm can be put in charge of site management as site engineer or site manager.

COURSE OBJECTIVES
By the end of this course students should be able to state, explain or describe the following:
o General management principles and practice
o Role of construction industry in Ghana and project cycle,
o Elements, types and conditions of civil engineering contracts,
o Preparation of construction site establishment and method statement
o Construction planning techniques and work programming,
o Controls in site management of construction works,
o Work study and operations research in construction,
o Valuation of construction works and claims

List of References
1. Construction management: principle and practice by Alan Griffith and Paul Watson

TABLE OF CONTENTS

PART ONE – CONSTRUCTION CONTRACT ADMINISTRATION AND

MANAGEMENT 1

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1.0 51.1 DEFINITION AND PRINCIPLES OF MANAGEMENT

1
1.2 ROLES OF MANAGERS 3
1.3 MANAGEMENT PRACTICE: ORGANISATIONAL STRUCTURE 4
1.4 MOTIVATION OF CONSTRUCTION WORKERS 8
2.0 Error! Bookmark not defined.2.1 ELEMENTS OF CONTRACT LAW AND
ARBITRATION 11
2.2 TYPES OF CIVIL ENGINEERING CONTRACT 12
2.3 TENDER DOCUMENTS AND TENDERING PROCESS 14
2.4 TENDER EVALUATION AND SELECTION OF A CONTRACTOR 17
3.0 Error! Bookmark not defined.3.1 CONSTRUCTION PROJECT CYCLE
18
3.2 TYPES OF CONTRACTUAL RELATIONSHIPS 20
3.3 TRADITIONAL PROCUREMENT SYSTEM 21
3.4 CONSTRUCTION CONTRACTUAL ORGANISATION 22
3.5 REGISTRATION AND CLASSIFICATION OF CONTRACTORS 25
3.6 IMPORTANCE OF CONSTRUCTION INDUSTRY 26
4.0 CONTRACT ADMINISTRATION AND MANAGEMENT 27
4.1 SCOPE OF CONTRACT ADMINISTRATION AND MANAGEMENT 27
4.2 ROLES OF EMPLOYER, ENGINEER OR HIS REPRESENTATIVE, AND
CONTRACTOR 28
4.3 SITE MEETINGS AND PROGRESS REPORTING 28
4.4 DEFINITIONS AND PURPOSE OF VALUATION OF CONSTRUCTION
WORKS 28
4.5 GENERAL PROCEDURE FOR WORKS VALUATION 29
4.6 PURPOSE AND CONTENTS OF INTERIM PAYMENT CERTIFICATES (IPC),
AND VETTING OF CERTIFICATE 33
4.7 PRINCIPLES OF VALUATION OF WORKS 36
4.8 TAKING OVER CERTIFICATES 41
4.9 VARIATIONS AND CLAIMS 42

PART TWO - CONSTRUCTION PLANNING, PRODUCTION AND

SUPERVISION 46

5.0 515.1 SITE ESTABLISHMENT OF PRELIMINARIES CONTAINED IN THE

CONTRACT 46
5.2 SITE ORGANISATION STRUCTURE 47
5.3 SITE LAYOUT PLANNING AND PREPARATION 48

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5.4 WELFARE PROVISION 51

6.0 CONSTRUCTION PRODUCTION 52
6.1 WORK STUDY (WORK TASK ANALYSIS) 52
6.2 METHOD STUDY 53
6.3 TIME STUDY OR WORK MEASUREMENT 55
7.0 CONSTRUCTION PLANNING TECHNIQUES 61
7.1 CONSTRUCTION PLANNING AND METHOD STATEMENT 61
7.2 PRE-TENDER PLANNING 62
7.3 POST TENDER PLANNING 62
7.4 CONSTRUCTION PLANNING: CRITICAL PATH METHOD 63
7.5 PROJECT CRASHING AND TIME-COST TRADE OFF 76
7.6 LINE OF BALANCE 80
8.0 CONSTRUCTION CONTROL 86
8.1 CONCEPT OF CONTROL 86
8.2 PROGRESS AND TIME CONTROL 87
8.3 COST CONTROL 90
8.4 QUALITY CONTROL 92

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PART ONE – CONSTRUCTION CONTRACT

ADMINISTRATION AND MANAGEMENT

CHAPTER ONE

1.0 MANAGEMENT PRINCIPLES AND PRACTICE

By the end of this session students should be able to state, explain or describe the
following:
o Management Principles (Theories and management functions-planning,
organising, coordinating, controlling, decision making)
o Role of managers
o Organization structures
o Motivation of construction workers (incentives and Maslow’s hierarchy of
needs)

1.1 DEFINITION AND PRINCIPLES OF MANAGEMENT

Management science also called Operation Research has its basis in rational or systematic
approach. Management science;
1. Prescribes a standardised set of thoughtfully designed and relevant procedures
together with the necessary control functions,
2. Involves the study and analysis of operations for efficiency. i.e. design to achieve
objectives at the minimum cost, minimum time duration and with appropriate
quality
3. Motivation of employees,
4. Study problem, factors must be measured through quantitative evaluation before
analysis takes place,

Behavioural sciences – This deals with psychology, sociology and anthropology –

(specifically socio-cultural anthropology) personal characteristics,

Management is defined as a set of activities directed at the efficient and effective

utilization of resources in the pursuit of one or more goals.

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Managerial
Activities
Financial,
Human resources
resources
Efficient and effective
utilization of
resources
Physical, Information
resources resources
Goals
achievement

Conceptual framwork for effective management practice

Management functions
Managers engage in different activities and change activities frequently. Management is a
process which involves four formal activities or management functions. Management
functions are the set of activities inherent in most managerial jobs. These activities are:
1. Planning (work, material, plant, labour) and decision making. This involves
determining the organizational goals and deciding how to best achieve them.
2. Organising (work, workers). Organising is the process of grouping activities and
resources in a logical and appropriate way. It involves setting up organizational
chart, clear channels of communications between and within functional areas,
flow of instructions and information, work content, quality standards, limit of
authority.
3. Directing or leading and motivating (personnel, workers). Motivating
employees to attain goals, managing group processes, and dealing with conflict
and change are all part of leading function.
4. Controlling (time, cost, quality). Controlling refers to the process of monitoring
progress and organizational activities towards goal attainment and making the
necessary adjustments.
5. Staffing

Efficiency and effectiveness

Management also involves the efficient and effective use of resources (human, physical,
financial, and information such as procedures, productivities etc.). Successful management
is the achievement of both efficiency and effectiveness. Effectiveness combined with
efficiency is the hallmark of successful management. Efficiency means operating in such a
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way that resources are not wasted. Efficiency means operating or carrying out activities
without wasting resources. Efficiency is commonly defined as the minimum resource
level that is theoretically required to run the desired operations in a given system
compared to how much resources that are actually used. Effectiveness means doing the
right thing in the right way at the right times.

“Efficiency is the ability to produce an intended result in the way that results in the least
waste of time, effort, and resources. Effectiveness is the ability to produce a better result,
one that delivers more value or achieves a better outcome.”

Organizational goals
Goals are targets organizations aim for. These goals are the statements expressing where
the organization wants to be at a specified time in the future. Any well functioning
organisation is structured to meet the goals or aims and objectives that are set out by the
leadership of that organization. Goals are structured by establishing the goals in the form
of a hierarchy or levels, providing at each level, the structure and resources needed for the
goal's achievement.

Goals set by levels

1. Strategic goals (top level - strategic management)
o At the top of the hierarchy, broad level of strategic goals are set,
o Goals provide a clear purpose and direction for the organization.
o Cover the organisation's interaction with its environment and its future
achievements in this respect.

2. Operating goals (bottom level)

o These are the level at which actual work is carried out. They are the
lowest level where operating activities are done.
o They are detailed, specific, usually quantitative and as a rule concerned
with the relatively short term,
o For production units, specific outputs are stated,
o Achieving goals with maximum efficiency

e.g The 17 SDGs are Strategic goals for the United Nations, but the specific targets e.g
11.1, 11.2, etc are specific for the countries. Similar applies for the construction industry.

1.2 ROLES OF MANAGERS

There are three categories of managers’ role: Interpersonal roles, Informational roles and
Decision roles.

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Manager’s
role

Interpersonal roles Informational roles Decision roles

1. Figurehead 1. Monitor 1. Entrepreneur
2. Leader 2. Disseminat 2. Disturbance
3. Liaison* or handler
3. Spokespers 3. Resource
on allocator,
Figure 1 Role of Manager 4. Negotiator

*A manager is a liason between for instance, the ownership of the company, and the
workers

Management Skills
A manger is responsible for selecting, obtaining, distributing, organizing and putting to use
all the resources that are necessary to pursue and achieve an organisation's objective. A
good manager should have the following skills.

1. Technical skills-to exercise expertise related to the procedures and methods of

the organisation in a proficient manner e.g. Apporpirate engineering
knowlegde/training for an engineering work.

2. Human relation skills (interpersonal skills)- This is the ability to get on with
other people and to work in cooperation with them. For the inter personal
relationship to be strong and healthy, a manager needs to be self-aware,
understanding, and sensitive to the feelings and thoughts of others,

3. Diagnostic skills - This is the ability to see problems from a broad range of
views and to provide solutions for the benefit of the whole rather than a small
part of an organisation's objective.e.g If the manager cannot diagnose the
problems within the organization, how then can he/she solve them?

4. Conceptual skills - This is the ability to understand how a variety of factors

are interrelated, and to identify and exploit new opportunities for the
organization.

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1.3 MANAGEMENT PRACTICE: ORGANISATIONAL

STRUCTURE
Design of organisational structure

Organisations have planned formal structure or skeleton called organizational structure.

The structure is designed to achieve the goals of the organisation. The organisational
structure:
● Is planned in order to meet the goals of the organisation,
● Provides a basis for manager's action,
● Shows the layout of the various parts of an organisation and how they
relate to each other,
● Provides a description for the jobs in the structure and how the positions
related to those jobs are coordinated.
● Shows the hierarchical relationship of authority and the linking of the
relevant parts of the structure,

There are two type of organizational structure. These are:

❑ Functional classification (Unitary-form) (functional divisions, division of labour
– sections, groups to deal with specialization),

Individuals or groups have only a specific function. e.g. a person brought in to do concrete
works may do all the concrete works on the various parts of the project (i.e, building, drain,
etc. wherever there are concrete works, this group would be there to perform this sole
function).

GM

Building Concrete Pipework Administration

and
works works drainage

Figure 2 Unitary form of organization

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❑ Project/product classification (multidivisional form) (Department, divisions)

GM

A. Water B. Structural C. Road D. Urban storm

supply and works works drainage works
sanitation

Figure 3 Multidivision form of organization

e.g. Here, groups take charge of specific aspects of the project (similar to CED) where
each expert manages for instance the volumes of concrete works generated within their
respective area of work.

There are two types of organizations structure: Mechanistic organization and Organic
organization.

Mechanistic organizations have:

o Unitary form of organization
o Strong vertical specialization and control,
o Well-documented policies, processes, procedures and proceedings of all
kinds, for both decision making and control,
o Centralised Hierarchy of control with well-defined division of labour, and
resources,

Organic organizations have:

o Multidivision form of organization,
o Decentralized or flat hierarchy of authority with strong horizontal
specialization and few documented policies, procedures and rules,
o informal coordination and control,

There are two aspects of organization structure: Vertical specialization and horizontal
specialization. In most cases companies’ organizational structures are designed by
combining the two specializations depending on the size of the company.

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Vertical specialisation (VS). It refers to the hierarchical structure of authority, from

managers to subordinates,

Legal services MD Board

Plant pool Adm Constuction

Figure 4 Organisational structure showing vertical specialization

(MD- managing director, Adm-administration)

Horizontal specialization (HS). It is the differentiation of functions within a level of the

hierarchy. For example, at one particular level may be shown managers of departments,
each having approximately equal importance in the hierarchy, though they have quite
different functions to perform. There are three forms of horizontal specification (H.S.):
functional, divisional and matrix.

● Functional departmentation results in grouping by functional skills. The types of

work task are grouped together.

● The Divisional departmentation results in horizontal grouping by product,

geographical location, customer, or service, eg. A construction company can be
divided into - civil engineering works, building works, etc.

● The Matrix departmentation is an organisational structure that attempts to place

equal emphasis on technical and product development and a major departure from
traditional structures (described above). In the matrix form there is reporting from
within organisation to two authorities, each group of specialists reports both to a
functional manager of their particular expertise group and also to a project manager.
The project manager (P.M) sees to the achievement of project objectives by
building the project team consisting of members of functional groups, namely the
design, estimating, purchasing and construction.

GM

Design Estimating Purchasing Construction

Responsibility

P.M Project responsibilities

Functional

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Figure 5 Organisational structure showing vertical specialization

Design of organisational system

The designs are based on open system and the type of technology employed by the
organization and the kind of environment encountered by it. Organisations are designed as
open system having strong links with the environment. Closed system (rigid) has no
interaction with the environment. The determinants to guide design of organisation
structures are environmental interaction, technology used by the organization and
psychosocial influences. Environmental interactions include input and output factors.
Technology is used for transforming the input (all types of resources) into the finished
product. Psychological influence is a behavioural science which involves the study of
human factors in organisation and the manner people behave in organizations.

Organisation charts
They are diagrams used to illustrate the formal structure of an organisation and are
generally used to communicate the details of the structure to those who need to know.
● Charts depict the hierarchical structure in such a way that they show the direct
relationships between managers and their subordinates.
● Brief job description, detail processes and work tasks with which each is
involved are excluded but are provided as document.
● The chart does not fully detail the following:
o lines of authority,
o staff relationships,
o detailed jobs carried out by each individual in a group,
o informal relationships,
o lateral links showing cooperative action between various positions in the
structure,
o those situations where informalities have become the norm
● The structure shows the distribution of authority to managers and
specialization (authority and responsibility). The following are shown;
o division of labour e.g. department, sections, groups to deal with
specialization,
o span of control (relates to the number of subordinates that a manager can
supervise effectively) in manager-subordinate relationship and vertical
flow of authority and responsibility,
o Line and staff units: line positions have formal authority to make decisions
whereas staff positions have functional authority to advise those in line
positions.

1.4 MOTIVATION OF CONSTRUCTION WORKERS

Motivation Theory: Abraham Maslow’s hierarchy of needs theory

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There are two main sources of motivation to work: one is job satisfaction and the other is
financial reward gained. A need acts as a motivator as long as it remains unsatisfied
Maslow identified a hierarchy of needs consisting of a series (five levels) of ascending
needs in order of importance from basic need to self-actualisation. Needs change from time
to time because some will eventually be satisfied (law of diminishing utility) or
(satisfaction is a progression concept). E.g. an employee's needs are likely to change over
a period of time after a pay raise is awarded.
o Employee's needs which are not met affect performance. Examples of such needs
are: Money, respect, security, proving one's ability at work, friendship, etc.
o Manager has to identify these needs and make appropriate conditions to meet them,
o In promoting motivation the objective of the organisation must also be met, for
employee to be truly productive.

Self-
Actualisation

Esteem

Social needs

Safety or security

Basic needs/Physiological needs

Figure 6 Maslow’s hierarchy of needs

o Satisfied need is no more a satisfaction "deficit" (deficit principle)

o Progression principle is implicit in the theory, if the need below one
particular level is satisfied the need arise to another level

1. Physiological needs
- Need for the fundamental human requirements of shelter, food, clothe,
water, sleep,

2. Security
- Need for a feeling of security and protection against dangers or threats
- Need for stable association with others in interpersonal relationships

3. Social Needs

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- Need for association with other individuals or in groups, to belong to a

group,
- Need for love and affection,
- relationships with other
- Acceptance by others

4. Esteem
- To achieve in order to gain approval and recognition,
- Need to be held in esteem by others,
- Need for sense of mastery (power of influence over others,
- Need for respect,
- Need for recognition by others,
- Status,
- Competence,
- Achievement,

5. Self-actualisation
- Need to realise the full potential within oneself, engage in self-
development activities,
- Use creative ability, higher degree of self-expression,
- Freedom to make choices, decision and take action,

Job Satisfaction (Frederick Herzberg theory)

The aim of a manager is to create an environment in which the objectives of the

organisation can be economically and satisfactorily achieved while at the same time good
working conditions are provided for the human resources involved. Herzberg theory noted
that there are demotivators as well as motivators.

Job satisfaction is the extent to which a person feels satisfied or dissatisfied:

● With the work they have to carry out
● With their place in the hierarchy in relation to the colleagues with whom they
work and
● With the general environment in which they carry out their work

High job satisfaction results in

● Employees spending more time at their work
● Increasing their effort and raising productivity
● Enjoying good relations with their co-employees
● Seeking and accepting advice of their supervisors
● Being punctual with a minimum amount of absenteeism

Low job satisfaction

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● Employee will complain

● Argue
● Seek transfer
● Lower effort
● Be absent
● Ultimately quit

Herzberg two-factor theory of job satisfaction

Strong determinants of job satisfaction are: (growth factors or motivator factors)
● Achievement
● Recognition
● The work itself (job interest)
● Responsibility
● Advancement

Factors that cause job dissatisfaction (hygiene factors)

● Company policy and administration
● Supervision
● Salary
● Interpersonal relations
● Working conditions

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CHAPTER TWO

2.0 CIVIL ENGINEERING CONTRACTS

By the end of this session students should be able to state, explain or describe the
following:
o Elements of Contract law and arbitration
o Types of Civil Engineering Contracts,
o Contract Documents (contents and preparation of contract documents)
o Tendering Process (Types of tenders, tendering procedure)
o Bid Evaluation and award of contract

2.1 ELEMENTS OF CONTRACT LAW AND ARBITRATION

Construction contract is a legally and enforceable agreement, containing the condition
under which the constitution of a facility will take place. Client decides on the form of
contractual organisation that will best suit the constitution works. Not all forms of
contract can be implemented with every contractual organization. There should be offer
and acceptance of contract. Offer of contract is the form of a tender to execute the contract
and acceptance of the contract offer is the agreement by a client. When full and complete
agreement about conditions and the consideration (usually payments) has been reached,
the acceptance can be formalised.

Essentials of valid contract

The principal requirements of a contract are that the parties to the contract have the legal
capacity to do so, that their objectives are legal, and that the parties genuinely agree to be
parties to the contract (create a legally binding association between them).

Validity of Contracts
For a contract to be valid there must be:
1. Offer and acceptance of that offer. The client issue offer letter to the
contractor indicating the contractor sum and the contractor writes acceptance
letter to the client.
2. "form" which consists of a "deed" which is written, signed, sealed and
delivered,
or "consideration" – this support the contract if it is not by deed. It is defined
as some return, made by the promisee in respect of the promise made to him,
3. The parties must be legally capable of undertaking the obligations imposed
by the contract,
4. Genuine identity of consent of a party to a contract or of the subject matter
5. Legal backing of the subject matter of the contract,
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6. Intention to create a legal relationship,

Remedies for Breach of Contract

a) Damages
It consists of a sum of money, which will, as far as it is practicable, place the aggrieved
party in the same position as if the contract had been performed
The sum is called "liquidated damages" – it represents a genuine estimate o the loss
that is likely to result from the breach of contract. "Penalty" is the agreed sum in the
nature of punishment for the breach of contract. It is not normally recoverable in full,
but liquidated damages are recoverable in full.

b) Order for payment of a debt – It is "action of debt"

A debt, which is a liquidated or ascertained sum of money due from debtor to the
creditor, is to be recovered by an "action of debt"

c) Specific performance
It refers to an order of the court directing a party to a contract to perform his part of the
agreement. It is now only applied by the counts on rare occasions when damages would
be an inadequate remedy. It constitutes a fair and reasonable remedy and is capable of
effective supervision by the court.

d) Injunction
It is an order of court directing a person not to perform a specified act. If A had agreed
not to do something for the benefit of B and is found doing it, B can apply to court for
an injunction restraining A from carrying out his operation. Damages in these
circumstances would not be an adequate remedy.

e) Rescission
It consists of an order of court cancelling or setting aside a contract and results in setting
the parties back in the position that they were in before the contract was made.

2.2 TYPES OF CIVIL ENGINEERING CONTRACT

Types of construction contract are based predominantly on the ways in which a
contractor is paid for the work carried out.
1. Price in advance contracts: lump sum contracts, bill of quantities/
admeasurements contracts and schedule of rate,
2. cost reimbursement contracts,

Price in Advance
a) Lump sum
The contract sum is fixed and agreed before construction work commences and can be
used in:
1. traditional design-and- construction contracts
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2. management contracting
3. construction management contracts

Either – specification can be performance oriented eg construction 5km asphalt road in a

year.
Or – the project must be fully designed and detailed, complete with specifications for
quality of workmanship and materials and fully detailed drawings
❑ Evaluation of lump sum tenders is relatively straight forward
❑ Another form of lumpsum is All-in-contract based on performance-
oriented specification
Advantages to client
1. the overall price for the work is known at the outset
2. the client is not too involved in the construction process itself
3. it is readily possible to arrange for competitive tenders at the pre-contract
stage
4. A considerable amount of the risk and responsibility for the outcome of the
project can be transferred to the contractor
Disadvantages to client
1. overall project programme is usually longer than by employing some of the
other methods available because of the need to provide precise details of the
works
2. Also if changes are made to the scope of the work or unforeseen difficulties
arise, then disputes over payment will occur and the lump sum price will be
driven up.
- to solve this, re-evaluation based on quoted rates from tender documents
are used.

b) Bill of quantities contract

o List of items of work briefly described against quantities to be carried out are
entered.
o Standard item description and measurements are used
o It is used for work that has been only partly designed and detailed, and for which
all detailed drawing a are not yet available
o Quantities in the bill are approximate

c) Schedule of rates
- is a list of categories of work believed to be required in the works (but with not
quantities given) against which the tenderer is expected to write in the rate required
for carrying out one unit of measurement of the item

Main advantage of b) and c)

Client can often gain an advantage in the project programme, since the work can be put
out to tender before the fine detail of the design and drawings are finalized.

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Disadvantage
There is the increased risk that arises from the uncertainty of not knowing the exact
contract sum before work is commenced.

Cost reimbursement contracts

It involves recording the total actual cost of materials, plants and labour known as
allowable or prime cost, incurred in order to carry out works, and then adding to then a
previously agreed fee to cover profits and head office overheads
❑ it is used for work where it is not possible to prepare accurate definitions of the
extent and nature of the works involved prior to commencing constitution work
❑ it means the tenderer cannot prepare a realistic price, in either lump sum or
admeasurements terms

Advantages
❑ It has a great deal of flexibility built into it: so that the extent of works to be arried
out can be varied easily as can the overall programme and the total duration
involved be changed.

Disadvantages
o it is sometimes difficult to impose a ceiling on the amount of money to be spent
and that an unscrupulous contractor may abuse the system unless closely
supervised [there is incentive towards wastefulness]
o the method also demands considerable administrative input in supervising and
recording expenditure, in giving approvals for work to be undertaken and in
generally controlling costs i.e. The client involvement is greatly needed

Types of cost reimbursement are

1. Prime cost plus percentage fee
2. cost plus fluctuating fee
3. cost plus fixed fee
4. target cost plus fee

2.3 TENDER DOCUMENTS AND TENDERING PROCESS

The prime function of the tender documents is to provide would-be contractors who are
tendering with sufficient information about the works to enable them prepare competitive
and well-informed tenders.
Contractors tendering need to know:
a. know everything that will influence their costs estimation of the work to be
constructed
b. the form in which the tender should be prepared
c. how the tender should be submitted
d. the conditions governing the way in which the work must be carried out
e. the mode of payment and factors that will affect it

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f. Know their contractual responsibilities and those of the other parties concerned
with the ownership, engineering, design, and construction.

Tender Documents
1. Instruction to bidders
2. form of agreement/form of tender
3. general and specific condition of contracts
4. specification
5. drawing
6. bill of quantities

The tender documents will depend on the contractual arrangements, and in the most
common situation, i.e. a lump sum contract based upon bills of quantities as in building,
will consist of the following:
● Bills of quantities – including particulars of the conditions of contract
● Location drawings – from contract drawings
● Two copies of the form of tender
For civil engineering contracts where bill of quantities are dispensed with or not
necessary or for work of minor nature, the tender document will consist of the following:
● The specification, including particulars of the conditions of contract
● Drawing identical to contract drawings to define the extent of the work
● Two copies of the form of tender

Tendering Procedures
Client and his consultants decide on:
1. The contractual organisation to be used
2. the type of contract to be used
3. the tendering procedure

Tendering process involves 4 steps:

o Invitation to tender by client (letter of invitation)
o Preparation and submission of tenders by contractors
o Tender evaluation and selection of a contractor
o Contract award and taking over of site,

There are 3 ways of how tenders are invited:

1. Open tendering
2. selective tendering
3. negotiated tenders

1. Open Tendering
- through advertisement, given brief description and invitation of contractors to
tender
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- a cash deposit is required when contract document is requested; to discourage

some contractors
Advantage
It attracts maximum number of contractors or tenders and hence be the most competitive

Disadvantages
- Ill-equipped contractors to carry out the work either financially or technically are
received through this method
- They may also lack sufficient experience of the most appropriate kind
- An unnecessary burden is placed on the industry by way of unrewarded expense
for time and effort that is put into unsuccessful bids

2. Selective tendering
- Disadvantages of open tendering can be overcome by selective tendering
- It involves short list of contractors that are known to have appropriate
qualifications to carry out the work satisfactorily
- Prequalifying process: contractors are asked for further details concerning

● technical competence
● financial standing
● resources that they have at their disposal
● their relevant experience

3. Negotiated tendering
It is used where the magnitude of work is not fully established at the outset, where an
early start is of great importance and for work which is extremely difficult to undertake.
Many contracts negotiated with single contractors are of the prime cost type and it
involves two-stage tendering -initial competitive tendering, followed by negotiation.

Extension of contract: It is used in extending the scope of the work beyond a first-stage
contract. Negotiation is based on the tender submitted for the original contract.
Serial tendering is another form of extension contract, but the intention to have
extension is normally expressed at the time of the initial invitation to tender. The
intention to have subsequent contracts based upon the tender for the first is incorporated.

2.4 TENDER EVALUATION AND SELECTION OF A

CONTRACTOR

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o Contractors submit competitive tenders

o Contractor’s proposed construction method and any qualification added in a
covering letter from the tenderer is reported to client
o Check BQ's, rates, prices for inaccuracies and make correction before the
tenderers are compared
o Tenders are compared,
o Check for under- or over pricing of the rates. The difference may be due to errors
in the computations.
o After necessary checks and adjustments are made, a successful tenderer is
selected or a letter of intent is sent to the contractor when it is urgent to get the
successful tenderer preparing to start work before formal acceptance is made.
o A form of agreement can be used beforehand is required of the contractor, unless
a performance bond (is a document by which the contractor provides a formal
assurance to the client that the company will complete its entire obligation under
the contract). The guarantor or surety is usually a bank bond on payment of the
fee or premium by the contractor.

EXERCISE

1. What are the similarities and differences in the content of invitation for tenders
advertised in the print media in Ghana?
2. What are the contents of general and special conditions of FIDIC contract?
3. Outline the tendering procedure from advertisement stage to award of contract of
national and international competitive bidding in Ghana.
4. Write short notes of the role of arbitrator and the procedure for arbitration in civil
engineering contracts in Ghana.
5. Distinguish between performance and workmanship specifications. Outline the
content of technical specification for civil engineering contracts in Ghana
6. Outline the procedure for bid evaluation indicating details of responsiveness of
contractors to bidding. What are the conditions for rejecting a tender from a contractor?
7. Write short notes on price the following:
i. Price in advance contracts
ii. Cost reimbursement contracts,

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CHAPTER THREE

3.0 CONSTRUCTION PROJECT MANAGEMENT CYCLE AND

PROCUREMENT
By the end of this session students should be able to state, explain or describe the
following:
o Project Management Cycle (development process)
o Procurement system
o Registration and classification of contractors
o Importance of construction industry

3.1 CONSTRUCTION PROJECT CYCLE

Project works takes place in several distinct stages known as project cycle. The stages are
closely linked to each other and follow a logical progression. The last stage helps to provide
the basis for renewal of the cycle through subsequent project work. The various stages of
the project cycle are:
1. Project identification
2. Project preparation (pre-feasibility and project feasibility)
3. Project appraisal
4. Project implementation (construction and commissioning)
5. Project operation and maintenance
6. Monitoring and evaluation

Project identification
- It concerns with identifying project ideas that appears to represent high priority use of
the country's resource to achieve an important objective
- Project ideas should meet initial test of feasibility,
- Technical and institutional solution is found, and suitable policies adopted at cost
commensurate with the expected benefit
- Project identification report covers
o Project linkages with sector plan
o Current situation
o Need for the project
o Major options and alternatives
o Cost estimates, financing plan and institutional support
o Proposed pre feasibility and feasibility studies and other recommendations

Project preparation-Prefeasibility

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- It involves preliminary designs, costing and screening all alternative plans or

solutions capable of fully addressing all concern at project identification.
- Alternative plans are reduced to two or three solutions for further investigation into
detail at the project feasibility stage
- The report covers
o Introduction
o The project area and the need for the project
o Strategic plans
o Proposed project
o Conclusion and recommendation

Project preparation- Project feasibility

- It involves preliminary designs and analysis of alternatives,
- It requires a progressive refinement of the design of the project in all its dimensions,
technical, institutional, social, environmental and economic
- Report covers
o Background
o The project area and the need for the project
o The proposed project and designs
o Institutional and financial aspects
o Conclusion and recommendation

Project Appraisal
External agencies require a formal process of appraisal
● To assess the soundness of the project and
● Its overall readiness for implementation before approving of a project
● Check the proposed project for sound engineering based on acceptable,
appropriate and affordable technology which can be supported by the
proposed institutions,

Project implementation
It involves the management and execution of project activities from detailed design
through construction/installation to final commissioning. It covers actual development
and involves production of working drawings, and construction of projects up to the
commissioning to the project. It includes monitoring of all aspects of the project as it
proceeds and supervision by over site agencies.

Project operation and Maintenance

At this stage project benefits begin to flow through sound operation and adequate
maintenance. It is ensured that continued production of project output and hence
realization of project benefits is achieved. Project life is realized through adequate
maintenance based on
● Maintenance schedule
● Provision of spare parts

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● Clear differentiation between planned maintenance and breakdown

maintenance

Project Evaluation
It reviews project performance in terms of functioning, utilization and general impact on
the beneficiaries. The evaluation is based on the initial purpose for which it is built;
condition under which the project achieves success are to be stated; measure output against
standards; and the project is to be designed to make up for any shortfall.

3.2 TYPES OF CONTRACTUAL RELATIONSHIPS

To produce a constructed facility (e.g. civil works, road, building) a number of parties
have to be brought together to work within a contractual relationship.
1. Technical and/or financial responsibilities need to be defined,
2. Inter relationships between parties need to be established,

Party A: Client, owner, promoter, or employer,

This party is the customer of the constitution, industry and proposes to

purchase either a constructed facility or one of the other services that are
offered by the industry. Client may be individual, a group of people, a
partnership, a limited liability company or a local or central government
authority.

A client may not be skilled in construction practice may need expert advice
on the ff:
o feasibility studies and design of the works that are proposed,
o specialist equipment installations
o the preparation of the contract documents and other contract procedures
o tendering procedures and tender evaluation
o construction programming and scheduling
o the supervision of the construction of the work
o the certification of completed work for payment
o dealing with variation orders and claims for additional payments

Party B: Consultants
The advisers on above may be from:
o Client's own in-house staff
o They may be appointed from outside organisation

The members in this organisation have professional skills in engineering. They

Include: civil or structural, mechanical, building services, or professionals in architecture,
quantity surveying and project management. The generic term of consultants is used to
describe these advisers in general.

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Party C: Contractor
Contractor is an individual or a company (usually protected by limited liability) that
contracts to carry out the constitution works.
● Main contractor is appointed to execute the job,
● Subcontractor, who has specialist skills, experience and equipment to deal
with specialised aspects of the work as nominated by client. i.e. the client
subcontract or sublet some of the work to subcontractors.

3.3 TRADITIONAL PROCUREMENT SYSTEM

Procurement system is defined as the organisation structure adopted by the client for the
management of the design and construction of a building project. The objective is to
ensure that resources for the project are acquired in the most effective way. The resources
are:
1. technical and managerial expertise e.g. engineers, architects
2. construction labour, plant, equipment and materials

Appointment of consultants Appointment of contractor

Constructing
Designing

Figure 7 Traditional form of procuring consultant and contractor

Characteristics of traditional procurement system

1. Design is separated from construction, the responsibility of design and
construction is respectively vested in different organisations namely designers
and contractors
2. Design of the project is completed before contractor commences work on site.
3. Consultant prepares tender documents on which competitive bids on lump-
sum basis after completing the design are obtained from contractors
4. Successful contractor at the tender stage enters into contract with the client
and executes the work under the supervision of the original
consultant/designer,
Advantages
1. Final project and tendering cost is minimised and will be lower than using
majority of other procurement methods,
● Provided that the design has been fully developed and uncertainties
eliminated before tenders,
2. The existence of price bill of quantities,
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● enables interim evaluation to be assessed,

● and variations to be quickly and accurately valued by means of pre-agreed
rates,
3. It provides high degree of certainty that, quality and functional standards will
be met, than when using other systems.
4. Client is informed of his financial commitment before construction starts

Disadvantages
1. For tenders based on incomplete design, bids obtained can be considered as
● Indicative of the final cost
● The client is thus vulnerable to claims for additional financial re-
investment from the contractor:
2. The sequential fragmented nature of this system can
● Results in lengthening design and construction period. (project
implementation time is not shortened)
● Poor construction and communication between client and project team
● And problems of buildability,

3.4 CONSTRUCTION CONTRACTUAL ORGANISATION

The contractual relationship between parties will depend on the type of organisation that a
client chooses in order to obtain the constitution work. Organising contractual relationships
can be classified into 3 groups as follows: Traditional, design and construction, and
management.

Traditional Contractual Organisation (TCO)

In TCO the client has a direct contract with consultants to carry out the design works and
also probably the supervision of the construction, with quantity surveyor (QS) as one of
the consultants. The QS gives advice on a range of matter relating to:
1. the cost of the work
2. preparing some of the contract documents (BOQ's)
3. measuring the work completed form valuation and variation purposes, together
with the preparation of a final account
The client has direct contract with a contractor. The contractor comes into contract with
suppliers of materials of all kinds and with subcontractors for carrying out specialist
works and equipments installations.

Client Construction Management,

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Figure 8 Traditional form of procuring contractor

1. Nominated subcontractors
These are those suppliers and/or subcontractors nominated by the client or on his
behalf by one of the consultants.

2. Non-nominated or domestic subcontractors

They are arranged by the contractors to subcontract subject to an approval of the
engineering or architectural consultant.

Design and Construct Organisation

Organisation for a design and construct method involve a client having a contractual
relationship with a design and construct contractor. In this relationship the contract is for
the contractor to design the proposed constructed facility and to build it. In an absence of
in-house skill for the client, consultant is appointed to advise the client:
● on the arrangement for tenders for work to be submitted to design and build
contractor,
● for evaluation of tenders and work
● the selection of a suitable contractor

Management Contractual Organisation (MCO)

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MCO are generally formed to provide one of two types of service:

1. Management contracting,
2. Construction management,

Client

Consultant

Designers Design and

construct
contractor

Subcontractor and suppliers

Figure 9 Traditional form of procuring consultant and contractor

Management contracting organisation

● A client has a contractual relationship with a contractor who acts as a
management contractor, to provide purely management services,
● A client also contracts directly with consultants to provide design and cost
consultancy services,
● The management contractor then contracts directly with other contractors to
carry out the construction work,
Client

Consultants Management
contractor

Works contractors

Subcontractors and
suppliers

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Figure 10 Traditional form of procuring consultant and contractor

Construction management Organisation

A client enters into direct contracts with a professional construction manager, design and
cost consultants, and a works contractor.

Client

Consultants Construction
manager

Works contractors

Subcontractors and suppliers

Figure 11 Traditional form of procuring consultant and contractor

- The contractor is in direct relationship with the client rather than the construction
manager (CM)
- CM undertakes management functions as delegated directly by the client. CM acts
as the agent of the client.

3.5 REGISTRATION AND CLASSIFICATION OF CONTRACTORS

The construction works are undertaken by three groups of contractors based on the scale
of work:
(i) Large-scale multinational contracting firms
(ii) Medium-Scale local contracting firms
(iii) Small-scale firms.

Among these groups, major projects of the construction works are done by the large-scale
multinational firms. Sub-contracts and smaller contracts are done by small-scale and
medium-scale local firms.

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The classification of contractors undertaking civil works is aimed at the proper grading of
contractors into respective works categories and financial classes.
Table classification of road contractors.
Categorie Financia Nam Tender Total value
s l class e of figure up to of work up to
class cedi cedi
equivalent of equivalent of
A 4 A4 US$250,000 US$400,000
Roads, 3 A3 US$650,000 US$1,000,00
airports, 2 A2 US$1,250,00 0
etc 1 A1 0 US$2,000,00
No limit 0
No limit
B 4 B4 US$100,000 US$150,000
Bridges, 3 B3 US$250,000 US$400,000
culverts 2 B2 US$500,000 US$750,000
1 B1 No limit No limit
S 4 S4 NA NA
Steel 3 S3 US$250,000 US$400,000
Bridges, 2 S2 US$500,000 US$750,000
1 S1 No limit No limit
NA-not applicable

3.6 IMPORTANCE OF CONSTRUCTION INDUSTRY

The construction industry is composed of two sub-sectors: (i) building construction
(ii) Civil engineering construction. Broadly, building works are construction works in
which people will work or dwell, for example residential and non-residential buildings.
But civil engineering construction works are more concerned with controlling the natural
environment to provide what is known as the "infrastructure", for example roads, dams,
drains and airports. The major civil engineering contraction activities are: the excavation,
transport and compaction of earth and rock; construction in steel and concrete. The
construction industry provides the physical facilities for the other sectors, to enhance
development and growth. The development activities in turn lead to indirect employment
generation in the other sectors of the economy.

EXERCISE
1. Write short notes on each stage of project cycle.
2. Construction delivery methods can be categorized as follows. Explain each of the
method.
(a) traditional method
(b) design-build method
(c) construction management method
(d) turnkey method
(e) build-operate-transfer (BOT) method
3. What is the role of consulting firm in construction of a civil engineering project?
4. Who is a resident engineer and what are his/her duties for a typical civil works
project?

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CHAPTER FOUR

4.0 CONTRACT ADMINISTRATION AND MANAGEMENT

By the end of this chapter students should be able to state, explain or describe
the following:

o Scope of contract supervision and management

o Roles of Employer, Engineer or his Representative, and Contractor
o Site meetings and progress reporting
o Purpose of valuation of works
o Procedure for valuation of works
o Preparation of certification for payment
o Variations and claims

4.1 SCOPE OF CONTRACT ADMINISTRATION AND

MANAGEMENT

This covers the following aspects:

1. Contract supervision (progress and quality control)
o Review and update of engineering designs
o Work programming and progress control
o Quality testing and control
o Produce as built drawings

2. Cost control

o Valuation of works for interim payment,

o Obtaining monthly application from contractor for interim payment,
o Evaluate claims for additional payments
o Approval of claims and variation orders

3. Correspondence and contract administration

o Possession of site/ setting out

o Pre-commencement meetings
o Site meetings
o Site inspections
o Monthly, quarterly and annual progress reports, project completion reports
o Specifications/drawing/revised drawings
o Keeping and filing of site records and correspondences

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4. Taking-over of works

o Partial taking-over of the works

o Payment of retention money (half paid to contractor)
o Statement of completion (final account)
o Final taking-over and final taking-over certificate
o Defect liability period
o Final statement and final certificate

4.2 ROLES OF EMPLOYER, ENGINEER OR HIS

REPRESENTATIVE, AND CONTRACTOR
Read on the following:

o Role of the employer

o Role of the engineer (consultant)
o Duties of the engineer’s representative (ER)

4.3 SITE MEETINGS AND PROGRESS REPORTING

Read on the following:

o Purpose of routine site meetings

o Principal participants at site meetings
o Agenda for site meetings
o How to organize site meetings and minutes of site meetings
o Content of progress report and annexes to the report,

4.4 DEFINITIONS AND PURPOSE OF VALUATION OF

CONSTRUCTION WORKS

Purpose of Valuation of works is to:

o Provide a means of estimating cost of project;

o Determine amount payable to the Contractor at any point in time during
implementation of project;
o Provide means of determining value of works for purposes of planning/cost
control;
o Provide means for cost studies and trends.

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Definitions

Dayworks: Different work inputs subject to payment on time basis for the Contractor’s
materials, plant and equipment as well as labour.

Defect: Any part of the works not completed in accordance with drawings and
technical specification (material and workmanship)

Defects Liability Certificate:

Certificate/Letter of approval by Consultant’s Project Manager upon
correction of defects if any at the end of Defects Liability Period.

Defects Liability Period:

Period named in Contract Document and calculated from completion date.

Final Payment:
Certificate of payment issued by Consultant’s Project Manager just before
Defects Liability Period.

Interim Payment Certificate:

Any Certificate of Payment other than the Final Payment Certificate.

Retention Money:
The aggregate of all monies retained by Employer pursuant to Clause 48
and its conditions therein.

Variation: Instructions given by the Project Manager which varies the works.

4.5 GENERAL PROCEDURE FOR WORKS VALUATION

Contractor’s Quantity Surveyor’s Preparation

Prior to the valuation date, the Contractor’s Quantity Surveyor will carry out some
preparatory work to ensure the availability of all valuation information and avoid under
valuation. Hence, he/she will carry out the following before meeting his/her counterpart.

(a) Prepare interim valuations with Sub-Contractors working on the project (e.g, ground
worker; bricklayer, plasterer, painter) for work executed over the period.

(b) Advise all Nominated Sub-Contractors and Suppliers to submit their application for
payment before the valuation date.

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(c) Inform and advise all Statutory Authorities to submit their fees and charges (including
materials and components) for work executed to date.

(d) Work through the list of all Architect’s instructions executed and their estimated
values.

(e) Where an Architect’s/Consultant’s instruction has been executed on a daywork basis,

the Contractor’s Quantity surveyor ensures that the daywork is signed by the Clerk
of Works and bears the Architect’s instruction origin or number, priced and ready for
the Client’s Quantity surveyor’s decision whether or not it will be included in the
valuation.

(f) Prepare, list and value all site instructions or Contractor’s verbal instructions which
have been executed but awaited formal Architect’s/Consultant’s instructions

(g) Calculate the estimated value of claim for loss and/or expense, which the Architect
has been notified of but has yet to be prepared formally for submission.

(h) Re-measure any executed work item, which has been provisionally measured in the
bills of quantities.

(i) Prepare a list of materials and components on and off site

(j) Prepare a list of any construction problems such as variations between drawings and
the bills of quantities, under-measurements in the bills of quantities and so on, which
requires adjustment within the valuation.

Client’s Quantity Surveyor’s Preparation

Before the valuation date, the Client’s Quantity Surveyor will carry out the following
before the meeting.

(a) Go through the previous valuation notes (if any) to familiarize himself/herself with the
details with the build of that valuation.

(b) Check the site minutes and correspondence file to determine if they contain any
information, which may influence the outcome of the subsequent valuation.

(c) Examine the Nominated Sub-Contractor/ Supplier’s application for payment and
prepare list of items worthy of inspection on site.

(d) Check if all Nominated Sub-Contractor/ Supplier’s have received payment due to them
in the previous valuation.

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(e) Finalize the measurement and computation of any executed variations and
provisionally measured bills of quantities items for discussion and/or inclusion in the
valuation.

(f) Examine the list of unfixed materials included in the previous valuation and note any
materials, which, by reason of their value/quantity their use should reconcile with
thelist of unfixed materials on site for the current valuation.

(g) Check the authenticity of daywork sheets received and note those with excessive man-
hours for clarification or adjustment before inclusion in the valuation.

(h) Find out from the Architect whether there are any defective construction works on site,
which should not be included in the valuation.

(i) Check whether the Client’s authenticated VAT receipt for the previous interim
valuation has been returned by the Contractor.

The Valuation Meeting

When both Quantity Surveyors meet on site, their first task is to tour the site, inspect the
works and take notes as necessary of the proportion of work executed on each section, trade
or element. The site notes should cover the Main Contractor’s, Sub-Contractors and
Statutory Authorities’ work, quantities of materials/components on site and any items of
work worthy of discussion/attention.

On return to the site office, the value of each section, trade or element is assessed.
Generally, the following are normally considered in the preparation of the interim
valuation.
● Main Contractor’s work items
● Nominated Sub-Contractor’s Application for Payment
● Nominated Suppliers’ Application for Payment
● Statutory Authorities’ Application for Payment

Main Contractor’s work items

The main Contractor’s work comprises the following:

(a) Measured Work

Where a priced bill of quantities is in use, the value of work executed by the Contractor
can be determined from the measured work section. This process consists of going
through the bills of quantities and extracting the value of completed and partially

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completed work items. The proportion of partially completed work items is assessed
by visual inspection rather than by precise measurement.

(b) Any authorized variations, which have been executed and measured, or value/adjusted
are included in the valuation.

Generally, interim valuation is prepared prior to the issue of an interim certificate for
payment. An interim valuation is an accurate assessment of the value of work executed
satisfactorily by the Contractor. The process involves valuation of the total amount of work,
which has been properly executed since the commencement of production, and the
material/components on site and off site (where instructed for inclusion by the consultant)
on the date of the valuation. The purpose of valuation is, firstly, to make recommendation
to the consultant for the issue of an interim certificate and, secondly, to finance the
contractor, and as means of checking progress of the works.

The main items of importance to be considered when valuing the works are:
● Measured work, including preliminaries
● Value of variations
● Value of Nominated Sub-Contractors and Supplier’s work
● Fluctuations, where applicable
● Unfixed materials on and off site
● Retention monies
● Advance Payment
● Previous payments
The interim valuation is normally prepared by the Contractor’s Quantity Surveyor to save
time and submitted to the Client’s Quantity Surveyor during their site valuation meeting
for his/her perusal and agreement. Moreover, the advantages accrued when both Surveyors
prepare the interim valuation together is hat several points of difference can be resolved
leading to the production of a fair valuation. The general procedure for preparation of
interim valuations is that both Quantity Surveyors arrange and confirm the valuation
meeting date and tie before they meet on site. However, at times, interim valuation dates
are agreed in advance (e.g. the last Friday or the 27th day of each month) at the project-
briefing meeting.

Accuracy of Valuation

The valuation for Consultants interim certificates should be made as accurately as is

reasonable possible. The contractor is entitles under the contract to the value of work
satisfactorily completed. However, the Client on the other hand must be protected against
over payment as in the event of insolvency of the Contractor, any excess payment cannot
be recovered and the Client might have to meet extra expense in employing another
Contractor to complete the works.

Aspects of Valuation of Works

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Valuation of Works shall consist of the following:

o Joint Measurement of Works (by Consultant, Contractor and Employer

representatives);
o Compute value of completed works as per rates in BOQ; Value of the permanent
works calculated and any other items of payment (equipment, temporary works,
day works, purchases etc.);
o Valuation of materials on site if required; Percentage of invoice values of listed
materials (% as allowed for in Contract Document for materials on site);
o Compute price adjustments;
o Compute retention to be withheld or released;
o Compute repayment/deductions for any advances;
o Other sums to which Contractor may be entitled to or otherwise
(underpayments/overpayments, deductions for previous materials on site etc.).
Compute value of works executed less cumulative amount certified previously (value of
last Interim Certificate)

4.6 PURPOSE AND CONTENTS OF INTERIM PAYMENT

CERTIFICATES (IPC), AND VETTING OF CERTIFICATE
The Purpose of Interim Payment

Interim payments benefit both contractor and Client as follows:

(a) The Contractor obtains cash flow and keeps finance cost down and gives contractual
safeguards (through payment for work done) if Client defaults.
(b) Clients benefits from lower tender figures.

Contents of Interim Payment Certificates Application

Interim Payment Certificates (IPC) shall then be the calculated value of all
works/payments/deductions etc. less cumulative amount previously certified.

Every IPC shall include/accompanied by the following:

o Covering letter stating amount payable to Contractor;
o Summary of items for payment on certificate
o Repayment on any advances
o Price adjustment computations
o Progress report sheet;
o Valuation Sheets
o Invoices of items executed under Provisional Sums;
o Copies of Performance Securities/Bonds;
o Copies of Insurance covers;
o Measurement sheets;
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o Tests results (It is required that test results as specified in technical specifications of
completed works/partially completed works which are being valued are attached to
IPC’s. Only works that have passed all requirements of specifications shall be certified
for payment)
o Calculation sheets.

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4.7 PRINCIPLES OF VALUATION OF WORKS

Joint Measurement of Works

To facilitate the process of Valuation of Works and Vetting, it is recommended that the
representatives of the Client, Consultant and Contractor undertake joint measurement of
works. Joint measurement of works reduces time involved in vetting of Claims. It also
reduces/eliminates points of contention.

Minimum Value of Certificate

The value of any Interim Payment Certificate (IPC) should not be below the minimum
value stipulated in the Contract Documents. This value is determined by/related to Contract
Price and duration of Contract.

Performance Security

This is given by Contractor as a guarantee to perform obligations in compliance with

contract and maintain same throughout the duration of the contract until Defects Liability
Period and until all Liabilities of Contractor to the Employer are fulfilled. Copies of
approved Performance Security are required as attachments to Valuation of Works.

Performance Guarantee

o This is warranty given by Guarantor (Bank, Financial Institution) to pay a specified

sum if Contractor does not fulfill his obligation to employer;
o Pursuant to clause 52 of Conditions of Contract, Performance Guarantee is required
to be valid until 28 days from date of issue of Certificate of Completion;
o Performance Guarantee can generally be invoked on demand without proof/reason
of non-performance. The Guarantor is obliged to make payment simply on demand;
o Usually the Contractor is at risk as Employer (beneficiary) can exercise right to call
even in the event of dispute awaiting arbitration;
o Cost of securing Security as stipulated in the Contract Document (general items)
shall be reimbursed to Contractor upon evidence of securing the required security;
o A copy of the security shall be attached to the first Interim Payment Certificate;
o The original shall be presented to the Employer through the Project Manager.

Performance Bond

o This is a written obligation to pay the Employer (beneficiary) on behalf of the

Contractor (principal) a specified sum upon occurrence of a specified event;
o The Bond shall be valid until one year from date of issue of Completion Certificate;
o Unlike the Performance Guarantee, it is not enforceable until a court decision or
arbitration award;
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o The Performance Guarantee is therefore stronger and more independent than the
Performance Bond.

Insurance (Clause 13.1)

The Contractor is required to provide in the joint names of the Employer and Contractor,
insurance cover for the works from start date to end of Defects Liability Period in amounts
and deductibles stated in Contract Documents for the following events:
o Loss/Damage to Works, Plant and Materials;
o Loss/damage to Equipment;
o Loss/Damage to property (except works, plant and equipment, materials) in
connection with the Contractor;
o Personal injury or death;

Scope of Insurance shall be specified in Conditions of Contract. Cost of securing insurance

as stipulated in General Items shall be reimbursed the Contractor upon providing evidence
for securing it. Payments for cost of securing insurance covers are “one-off” payments and
do not attract fluctuations. Copies of Insurance Covers shall be attached to Valuation of
Works.
Insurance Cover is required for
o Works/Contractor’s Plant/Equipment;
o Damage to persons/property
o All Risk

Provisional Sums (PS)

o Provisional Sums (PS) are sums included in Contract to be used for execution of any
part of the works, supplies, materials, plant, services, contingencies (Price and Physical
contingencies) where estimation of quantities, costs are difficult to determine at design
stage;
o Contractor is required to submit to Project Manager all quotations, invoices, vouchers,
receipts in connection with expenditures made under PS except where work is valued
by rates/prices set out in the BOQ;
o All expenditures under PS are required to be authorized by the Project Manager (PM);
o Where nominated Sub-Contractor is used, the main Contractor charges attendance rates
specified in the BOQ (Maximum of 30%).

Lump Sums (LS)

o The Consultant’s PM shall require the Contractor to submit a breakdown for each LS
item in the BOQ for approval within specified no. of days (usually 18 days) before
contract is signed;
o The value of each LS item contained in BOQ cannot be exceeded.

Variation Orders (VO)

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o VO’s are instructions to Contractor by PM which varies the works. Variation orders
may increase/decrease scope of works.
o If the work in the variation corresponds with an item description in the BOQ, the rate
in the BOQ shall be used to calculate the value of the variation, if
▪ The quantity of work involved does not exceed 25% of initial quantity in BOQ
▪ The cost change does not exceed 1% of initial contract price
▪ The timing of its execution does not cause the cost per unit of quantity to change
If the above conditions are not satisfied quotations from Contractor for new
rates for relevant items of work shall be negotiated with the Project
Manager. The Employer will have to approve the new rates to make it valid.
o Approval of the Employer is required for the following:
▪ Variation Order is in excess of 15% of initial Contract Price (sub-clause 3.8.2)
▪ Variation Order requires extension of time

Dayworks

o Dayworks are varied work inputs estimated on time basis for Contractor’s Labour,
Plant, Equipment, and Materials;
o Dayworks rates in Contractor’s bid are used for small additional works for which the
Project Manager gives advance written instructions for work to be paid for by that
manner;
o Payment under Dayworks will only be made to Contractor subject to signed Dayworks
forms;

Valuation of Materials on Site

o Materials on Site procured by Contractor for works can be valued for payment.
Payment is made on a percentage of submitted invoices;
o Such percentage is stated in the preamble to BOQ (usually should not exceed 75%);
o Amounts being certified for materials on site shall not exceed that required to complete
works and quantities involved should correspond to immediate requirements of
Contractor’s programme of works;
o Full repayment of advances made to the Contractor for materials on site are to be made
immediately after materials have been used in works;
o Payment under materials on site does not attract price adjustments (fluctuation).

Price Adjustments (Fluctuation)

Some contracts contain a price variation clause in order to protect the contractor against the risk
of rising prices due to inflation. To calculate the amount due, either the contractor has to produce
evidence of how prices have altered since he submitted his tender, or a formula that uses published
indices of price changes is applied to the payments due to him under billed rates.

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Prices/rates shall be adjusted for fluctuations in the cost of inputs only if provided for in
Contract Documents. In the event of changes in economic conditions compared to those
obtained 30 days before date of submission of the Bid.

Price adjustment is effected by the following formula:

P = x + a EL + b LL + c PL + d FU + e BI + f CE + g RS + h AG + i TI + j MT + MI
EL0 LL0 PL0 FU0 BI0 CE0 RS0 AG0 TI0 MT0 MI0

Where:
P = price adjustment factor;

X = a fixed coefficient, specified in the Contract Data, representing the non-

adjustable portion in contractual payments.
a, b, c, etc. are coefficients representing the estimated proportion of each cost element
(labour, materials, etc.) in the Works, or sections thereof, excluding Provisional Sums.

o The sum of the coefficients, the adjustable and non-adjustable portions of the payments,
should add up to 1 (one);
o The fixed coefficient x is usually 0.15 to take account of fixed cost elements;
o The current cost elements are designated as EL, PL etc. and the base cost indices are
EL0, PL0, etc.
o Base prices refer to prices of various aspects of the Bid price at a specified time prior
to the payment under the certification for adjustments;

EL = Expatriate Labour
LL = Local Labour
PL = Provision of Construction Plant
FU = Fuel
BI = Bitumen
CE = Cement
RS = Reinforcing Steel
AG = Aggregate
TI = Timber
MT = Maritime Transport
MI = Miscellaneous Expenditures

Retention Money

The retention money, as stated in the contract must be deducted from the total amount calculated
as due to the contractor in interim certificates for work done.

o There shall be a deduction indicated in the Contract Documents per each IPC. The limit
of cumulative retention shall be stated in the Contract Data (usually 5% of the Contract
price);

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o Retention is held by the Employer as “insurance” for the remedy of defects which may
be outstanding after Defects Liability Period;
o 10% of the value of each IPC is deducted as retention money by the Employer till the
limit of retention is reached;
o On completion of the whole works, one half of the retention money shall be released
to the Contractor and the other one half released when the Defects liability Period has
passed and the Project Manager has certified that all defects notified to Contractor have
been corrected;
o Deductions for retention shall not be made where the Contract allows the Contractor to
provide a Retention Bank Guarantee (This helps in the cash flow of the Contractor).

Advance Payment (Mobilisation)

Advance payment is made by employer if allowed/stipulated in Contract Documents

(usually against the provision of an unconditional Bank Guarantee in a form/by a Bank
acceptable to employer and in amounts/currencies equal to payment).
o The Guarantee must remain effective until advance payment has been fully repaid;
o The Contractor is to use payment for Plant, Equipment and Materials;
o Mobilisation required specifically for works, the Contractor is therefore required to
show/supply invoices and related documents to the Project Manager (clause 51 of the
Conditions of Contract applies);
o Interest must not be charged on advance payment.

Repayment of Advances

o Repayments are effected by deductions from IPC’s and shall be started from the first
IPC and completed before completion of works ( or as may be stated in Contract
Document);
o Repayment is determined as follows (assuming full repayment is required by 80%
completion):

A
R = Va  0.8  Vt

Where: R = Amount to be repaid

Va = Amount of the advance
Vt = Initial value of the contract (upon which advance was
made)
A = Amount of the interim payment (less revision of
prices/fluctuations)

Liquidated Damages

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o These are punitive charges stated in Contract Documents that the Contractor shall pay
each day that the completion date is later than the intended completion date (Clause 49
of Conditions of Contract);
o Cumulated amount of liquidated Damages shall not exceed the amount defined in the
Contract Documents (usually set between 5% – 10% of the Contract price).

Contingency

This is the Provisional Sum of money for quantity over runs and possible price increases
in summary of Bills of Quantities;

Where such Provisional Sum is provided, the Conditions of Contract shall state
manner/authority under which it can be used (usually the authority of the PM).

4.8 TAKING OVER CERTIFICATES

Purpose of General Certificates

The purpose of General Certificate in standard form of building contract serves three
main purposes as follows:
● To set out the consultant’s satisfaction with some aspects of the physical work and
ultimately with the whole of it.
● To notify the Client that the Contractor is entitled to payment (interim or final).
● To embody the consultant’s decision as between the parties in some matter in which
the contract gives him/her.

Purpose of Certificate of Practical Completion

With the issue of certificate of practical completion the following take effect

automatically in accordance with contract conditions.

● The Contractor becomes entitled to the release of half of the money of the total retention
fund (contract conditions 25 (4)).
● The defects liability period begins (contract condition 13)
● The Contractor is relieved of the obligation to insure the works (contract condition 16)
● Period of measurement begins (contract condition 25 (5)).
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● Contractors obligation under performance bond ends

● Any arbitration dependent upon the issuing of the certificate of practical completion
may be pursued.

Timetable for Certificate

● Certificates must be issued as stated in the contract Appendix (or monthly intervals
(25(1)).
● However, interim valuations are made by Quantity Surveyor whenever the Consultant
considers it necessary for a certificate.
● It is normal to always base a certificate on a valuation but not essential.
● The valuation shall be calculated not more than seven (7) days before the certificate
date (25(2)).
● The Contractor is entitled to payment fourteen (14) days from issue of the certificate or
days state in the appendix to contract conditions.

4.9 VARIATIONS AND CLAIMS

General Claims

The word 'claim' is defined in the context of FIDIC Conditions of Contract to mean "the
Contractor makes formal demands for his due in writing": The demands are for any
additional payment or extension of time pursuant to any clause of the Contract. Some
situations, which may give rise to claims, are as follows:
o Disputes over quantities,
o applicability of items in BOQ
o new items,
o specification interpretation,
o failure to give possession of site ,
o delay of issue of drawings or instructions by the Engineer
o delay in approval by the Engineer,
o adverse physical obstructions or condition ,
o variation and valuation of variations
o delay in payment by the Employer,
o actions of a nominated sub-contractor,
o acceleration,
o remedies
o special risks and
o suspension of work by the Employerlthe Engineer

Claims may be classified as

(1) Contractual claims,
(2) Extra-contractual claims, and
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(3) Ex-gratia claims.

Contractual claims are those made based on grounds, which are provided in the Conditions
of Contract as entitling the Contractor to additional payment.

Extra -contractual claims are those made upon grounds, which are considered to be legally
enforceable, although not covered by the terms of the Contract. Examples are unreasonable
termination of the Contract or failure to provide materials or facilities, which the Employer
has obligation to provide.

Ex -gratia claims are those not legally enforceable where the Contractor has suffered loss
or damage from causes outside his control, which are not the normal risks of his trade or
of the job unforeseeable at the time of tendering. For example claims fur extra cost of
carrying out the work owing to political, industrial or economic conditions, enforced use
of materials not covered by the price fluctuation clauses, etc.

The Sequence followed by the Contractor should be:

(i) Writing Notice to the Engineer (or the ER if authority was deleqaled) within 28
days.
(ii) Keep contemporary records and
(iii) Amount and ground of Claim in writing to the Engineer (within 28 days after the
notice).

The Engineer (or the ER) should then:

(i) Receive Notice of Claim,

(ii) Inspect contemporary records and instruct required measures
(iii) Decide his acceptance based on the following;
o is the ground of the claim reasonable or Justified?
o is the amount of the claim reasonable or justified?
The QS should monitor the Contractor's works and backup data on a daily, weekly and
monthly basis.

Procedures for Dealing with Claims

FIDIC Conditions of Contract, Clauses 53.1 -53.5, stipulate the formal procedure for
claims as follows:

(1) Notice of Claims

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Notwithstanding any other provision of the Contract, if the Contractor intends to claim any
additional payment pursuant to any Clause of these Conditions or otherwise, he shall give
notice of his intention to the Engineer, with a copy to the Employer, within 28 days after
the event giving rise to the claim has first arisen.

(2) Contemporary Records

Upon the happening of the event referred to in the Sub-Clause 53.1, the Contractor shall
keep such contemporary records as may reasonably be necessary to support any claim he
may subsequently wish to make. Without necessarily admitting the Employer's liability,
the Engineer shall on receipt of a notice under Sub-Clause 53.1, inspect such contemporary
records and ay instruct the Contractor to keep any further contemporary records as are
reasonable and be material to the claim of which notice has been given. The Contractor
shall permit the Engineer to inspect all records kept pursuant to this Sub-Clause and shall
supply him with copies thereof as and when the Engineer so instructs.

(3) Substantiation of Claims

Within 28 days, or such other reasonable time as may be agreed by the Engineer, of giving
notice under Sub-Clause 53.1, the Contractor shall send to the Engineer an account giving
detailed particulars of the amount claimed and the grounds upon which the claim is based.
Where the event giving rise to the claims has a continuing effect, such account shall be
considered to be an interim account and the Contractor shall, at such intervals as the
Engineer may reasonably require, send further interim accounts giving the accumulated
amount of the claim and any further grounds upon which is based. In cases where interim-
accounts are sent to the Engineer, the Contractor shall send a final account within 28 days
of the end of the effects resulting from the event.
The Contractor shall, if required to do so by the Engineer, forward a copy to the Employer
of all accounts sent to the Engineer pursuant to this sub- Clause.

(4) Failure to Comply

If the Contractor fails to comply with any of the provisions of this Clause in respect of any
claim which he seeks to make, his entitlement to payment in respect 1hereof shall not
exceed such as the Engineer or any arbitrator or arbitrators appointed pursuant to Sub-
Clause 67.3 assessing the claim considers to be verified by contemporary records (whether
or not such records were brought to the Engineer's notice as required under Sub- Clause
53.2 and 53.3).

(5) Payments of Claims

The Contractor is entitled to include in any interim payment certified by the Engineer
pursuant to Clause 60 such amount in respect of any claim for which he has supplied
sufficient evidence to enable the Engineer to determine the amount due.

Notification of intention to submit a claim must be given in writing. Any attempt by the
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Contractor to give oral notification or to ask for a Claim Number on the telephone should
be rejected. Inclusion of an amount against a brief description in the monthly statement
does not constitute proper notice of a claim and the Contractor must be so advised. The
notification must specify the event giving rise to the Claim, state why the Contractor
considers the Employer is liable, and state the provision in the Contract upon which the
claim is founded.

Negotiation of Claims

When the claim has been accepted in principle and has been evaluated negotiations should
be carried out with the Contractor to reach an amicable settlement. Once the claim has been
assessed a payment should be included in the interim certificates to be issued under Clause
60.1. If agreement cannot be reached, the Engineer should nevertheless determine the
amount at which he has assessed the claim leaving the Contractor under Clause 67.1.

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PART TWO - CONSTRUCTION PLANNING,

PRODUCTION AND SUPERVISION

CHAPTER FIVE

5.0 CONSTRUCTION SITE ESTABLISHMENT AND

ORGANISATION
By the end of this session students should be able to state, explain or describe the
following:

o Site establishment of preliminaries contained in the contract

o Construction site organizational structure
o Site layout design (site layout planning and preparation)
o Welfare provision, occupational health and safety issues

Site establishment is an essential component of pre-tender, pre-contract and start on site.

An efficient and effective site establishment provides the key to successful project
commencement, execution and completion. Site establishment for construction works
involves temporary construction works needed for the construction project. Site
establishment is discussed under four headings:
o Site establishment of preliminaries contained in the contract
o Site organisation structure
o Site layout planning and preparation
o Welfare provision

5.1 SITE ESTABLISHMENT OF PRELIMINARIES CONTAINED IN

THE CONTRACT
The preliminaries of contract outline some temporary works, facilities and initial preparation to be
done before commencement of a project. These include items such as:
o Contractual requirements (bond and insurances);
o Specified requirements

Contractual requirement

This covers items such as insurance of works, performance guarantee bond and third
party insurance.

Specified requirements

The provision of the following in the contract is considered:

o Accommodation (offices, stores, canteen, etc.)
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o Services (water, power, site transport, welfare etc),

o Plant and temporary works of many kinds

The specified requirements describe any requirements of the Engineer. The Specified
requirements cover accommodation and services, offices for the resident engineer,
provision of laboratory, surveying equipment, transport, telephone for the engineer’s site
staff, and tests on materials or the works, tests on materials etc. and a range of temporary
works that the engineer might use.

Site establishment and site preparation include planned location of main offices, storage
facilities, workshops and contractor’s equipment, modalities for providing offices,
accommodation, proposed communication methods etc are organized.

The site may need to be cleared by removing bushes and trees to allow access and
uninterrupted construction work. As part of the site preparation the site offices, storage
sheds etc need to be constructed.

5.2 SITE ORGANISATION STRUCTURE

Site organization proposed for the execution of works depends on the complexity of the
project, and it differs from project to project. The site organization chart showing the
positions of key work-force and the lines of authority and span of control. It clearly defines
and show structured channel of:
o Authority
o Responsibility
o Communication
o Control

Description of the works, the main activities are listed,

The approximate quantities provide the basis for the estimation of the manpower and
logistics required for successful completion of the project. Depending on the quantities of
main work items presented below, the required logistics and work force will be used to
complete works.

Site organisation structure

Organization chart proposed for the execution of works is presented. The organization chart
shows the positions of key work-force and the lines of authority and span of control.

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Managing
Director

Site
manager

Site Quantity
Site
Administrator Engineer Surveyor

Site Supervisor
Surveyor

Concrete Steel bending Building Works

Carpentry
Works
Foreman foreman Foreman
Foreman

Gang 1 Gang 1 Gang 2 Gang 2 Gang 1 Gang 1 Gang 2

Gang 2

Figure 12 Site Organization Chart for Construction Works

Work-force Requirement
The under listed human resources indicate the proposed work-force that would be assigned
for the successful execution of the project. The CVs of key staff are attached to this tender.
List and number of the staff proposed are provided. The organization structure and number
of workers depend on the proposed methodology and work programme for construction.
The positions and responsibilities of key personnel are described.

5.3 SITE LAYOUT PLANNING AND PREPARATION

Layout of construction site with fence is prepared prior during the tendering stage and it is
included in the method statement. The site offices, toilets, workshop, storage building and
canteen are shown on the site layout map. In setting out site, the key aspects that need to
be considered and included are:
o Layout plan, access and traffic control
o Storage and logistics
o Communication and site control
o Offices for the resident engineer, stores, canteen, etc.
o Site enclosure if necessary – fencing and hoarding
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o Quality control, provision of laboratory, surveying equipment, tests on materials or

the works,
o Safety and security
o Signposting

Logistics
Logistical description of equipment operation, usage, sharing and maintenance of
contractor’s equipment / tools etc is presented. The list of plant resources to be assigned
for successful execution of the project are provided

o Excavator
o Concrete mixers,
o Poker vibrators (various diameters)
o Generators,
o Air compressor and tools
o Welding equipment
o Bar bending equipment
o Pressure testing pumps
o Dewatering pumps
o Plate compactors
o Tipper trucks
o Water tanker
o Survey equipment (levelling and Theodolite)
o Pick-Ups

Site layout and accommodation

Temporary site yard with fence will be provided. The site offices, toilets, workshop, storage
building and canteen will be provided within the yard. It is our intention to provide
temporary residential accommodation if rented accommodation is not available. The site
layout has to be attached.

Materials supply and delivery

Procurement of plant and materials is a key factor affecting the timely completion of the
works. The procurement of plant and materials will be done in advance to avoid delays in
the work. The list of material suppliers including samples, specification sheets, certification
documents, where appropriate will be made available to the consultant. Cement at the
various sites and movement of materials between stores and sites will be well coordinated
to avoid shortage of materials on site.

Main construction works and methods

This section presents sequencing of activities for the construction and technical
descriptions of methods to be used for key activities including setting-out, pipe works
including valve chamber and stand post, and concrete works. The sequencing of activities
for the construction is provided.
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o The sequencing of activities for the construction of office building is as follows:

o Setting out of foundation for excavation,
o Excavation of foundation trenches,
o Construction of substructure footings, columns and blockwork,
o Backing and hardcore filling,
o Floor concreting,
o Construction of Superstructure, columns, beams, slabs, masonry and woodwork,
o Roofing,
o Finishing and painting,

The setting out of the construction works is done in accordance with the drawings and
specifications. The leveling instrument will also be used to establish the right levels to help
ascertain the accepted depths for excavation.
Manual labour and excavator are employed in excavating the trenches and foundations.

Quality assurance procedures

Quality assurance is the process that ensures that adequate systems, procedures and control
documents are in place to meet the quality criteria set by consultant.

The incorporation of quality assurance methods and procedures into the construction
system is done with the primary objectives of providing our client with the quality of work
required. As part of our quality assurance the following strategies are used:
o ISO certification of materials and equipment is inspected and the documentation
made available to the consultant before procurement is made.
o Characteristic strength of chippings and reinforcement and quality of sand and other
materials is analysed at approved laboratory before procurement is made.
o All materials to be brought to site is inspected prior to delivery.
o Once materials are delivered to site they are stored in a safe manner so as to prevent
deterioration in quality.
o Specified mix designs is complied with and concrete cubes sis sampled and tested
as work progresses. Furthermore, concrete poured is adequately cured to give the
expected strength.
o The methods to be used to control quality include dimension checks, material tests
prior to delivery, non-destructive tests, pressure tests, and leak tests.

Deliverables (reports, drawings, catalogues and specifications, communication)

The reports, drawings, manuals, and specifications for the project will be well documented
and filled. Catalogues and manual for repairs and maintenance is compiled and made
available to the Consultant and the operating staff. There is information flow and
coordination concerning material and equipment delivery to site, and technical issues.

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5.4 WELFARE PROVISION

The welfare of workers in the form of providing welfare facilities on site has to be
established. The contractor is required to implement a number of important preventive
measures. These measures are:
o Welfare facilities such as toilet, washing facilities, canteen, drinking water, storing
and changing clothing, rest facilities, are provided
o Provision and use of relevant personal protective gear (helmets, boots etc)
o A safety booklet to be provided for workers,
o First aid kit be made available at each site

Occupational Health and Safety Issues

In order to ensure a safe and healthy working environment, the Contractor is required to
implement a number of important preventive measures. These measures are:
o The responsibilities and roles will be clearly defined
o A safety booklet will be provided for workers,
o Provision and use of relevant personal protective gear (helmets, boots etc)
o First aid kit be made available at each site
o Welfare facilities such as canteen and drinking water will be provided
o Adequate cleaning, housekeeping and awareness of HIV/AIDS prevention
o Adequate fencing, signing and guarding of working area
o Provisions for road safety; maintenance of vehicles and machinery
o Recording and analysing of accidents to prevent similar accidents
o Precaution taken for working near overhead power lines
o Prevention of excessive exposure to dust and noise

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CHAPTER SIX

6.0 CONSTRUCTION PRODUCTION

By the end of this session students should be able to state, explain or describe the
following:

o Construction production processes

o Method study
o Time study (Work Measurements)
o Equipment and labour productivity
o Performance improvement

6.1 WORK STUDY (WORK TASK ANALYSIS)

Work study is a tool of productivity analysis for examining work operations to ensure
efficiency and economy. Work study is a measurement science which concerns the
techniques of method study and work measurement (time study), which is used in the
examination of human work and systematic investigation of all resources and factors which
affect the efficiency and economy of the production operations being reviewed, in order to
effect improvement. Both method study and time study have gained wide acceptance in the
manufacturing industry and are increasingly finding favour in the construction industry by
bringing improvement to the badly organized environment all too often found on
construction projects.

Work Study

Method Study Time study or Work

To improve methods of Measurement
operation To assess human effectiveness

Higher productivity

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6.2 METHOD STUDY

Method study is sometimes called Process Study or Motion Study. The object of Method
Study is to examine the ways of doing work in order to develop easier and more effective
methods of production. Although the detailed analysis may become very complex, the
basic procedure is the same for every investigation. Method study when properly used
should result in higher productivity through an improved production facility layout, a better
environment for work, reduction of danger and fatigue, and improved quality of work, re-
planning and progressing of production, and better plant and equipment design.

Some problems which require method study to solve them:

● Recourse to excessive labour overtime
● Bottlenecks in the flow of materials
● High material wastage
● Frequent plant breakdowns
● Fatiguing work
● Poor quality and workmanship
● Delays in progress
● Excessive errors and mistakes
● Site congestion and poor site layout
● High labour turnover
● Bad working conditions
● Shortage of resources

Method study is essentially concerned with finding better ways of doing things, and it
contributes to improve efficiency by getting rid of unnecessary work, available delays,
and other forms of waste. This is achieves through:
● Improved layout and design of construction site and plants,
● Improved working procedures,
● Improved use of materials, plants and equipment, and manpower.
● Improved working environment,
● Improved design or specification of the work,

Flow Diagram
The flow diagram records the activities on a plan of the area. A set of symbols is used to
record the sequence of events and assists in the visualization of the processes under
study.
Element Symbol

Operation element
Transport element
Storage
Delays D
Leveling L
Idle element

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Inspection
Laying/ compaction

Process and Multiple Activity Charts

A graphic representation of an operation analysis is called the process chart. The method
of presentation of process chart is similar to flow diagram, except that only relevant aspects
are recorded. Like the flow diagram, the symbols are used but a plan is not required. It is
recommended when the sequence of flow adopted by workers would congest a drawing.

The sequence of elements and cycle of operations are displayed on a multiple activity chart
by construction site management. Multiple activity charts show the activities durations
using line for each element and equipment cycle times.

Example. Draw a multiple activity chart for pouring of mixing and transporting concrete
and pouring the concrete at four flow of a building. Assume cycle times and concrete
batch volume.

Method study procedure

Aim:
To improve working methods
Procedures:
● Define the problem and select operation or work to be studied,
● Record all the proposed methods, record the observed facts of the present or
proposed method
● Examine the methods or facts critically to determine their true purpose and
seek possible alternatives.
● Develop the best method; develop the most practical, economical and efficient
method with due regards to all the relevant circumstances.
● Approve and maintain new method; approve the improved method as standard
practice, and maintain the new method by regular inspection,
Result:
● Improve workplace layout
● Improve equipment design
● Reduction in worker fatigue etc.
● All leading to increased efficiency and
productivity

Select
The choice should be the job must likely to affect the overall productivity of the total
enterprise. Factors to be considered may be economic, technical or human. Economic
considerations include bottlenecks which are holding up other activities e.g. formwork
for reinforced concrete framed buildings,

Record
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In order that the method of work concerned may be subjected to a critical analysis it is
necessary to prepare a factual record of activities involved and this allows a "before and
after" comparison to be made when improved procedure has been installed. Graphical
recording methods could be used if possible.

Examine or analyse
The record facts concerning the work under investigations must be exhaustively
examined in an ordered sequence and objective manner. Critical examination is the crux
of the basic procedure. The objective of critically examining the recorded facts of an
existing or proposed method is to determine the true reasons underlying each event, and
to draw up of a systematic list of all possible improvement for later development. The
examination is achieved by two main sets of detailed questions: the primary question is
how to indicate the facts and the reasons underlying them, and the secondary question
is how to indicate the alternative method and to ensure that every aspect of the activity
under consideration is examined and that all alternatives have fully considered.

Develop
A comprehensive statement of the existing method together with clear indications of
possible improvements would be available to the investigator. The most effective of the
proposed method is now developed, using essential operations and inspections as
framework. When improved method is fully synthesized it should be recorded on a flow
process chart, with a survey of the total number of activities so that the savings time and
/ or distance may be compared. This summary must intend be subjected to the same
analysis to ensure that the proposed method is logical and practical.

6.3 TIME STUDY OR WORK MEASUREMENT

Work Measurement or Time Study is defined in the BS 3138 as the application of
techniques designed to establish the time for a qualified worker to carry out a specified job
at a defined level of performance. In this sense it includes those aspects of work study
which are outside the province of method study.

Work Measurement Technique is a work measurement technique for recording the times
and rates of working for the elements of a specified work carried out under specified
conditions, and for analysing the data so as to determine the time necessary to carry out a
particular work. One of the difficulties of applying time study in construction stems for the
fact that it is not always easy to define small elements of the work being undertaken. It is
also affected by the variety of ways by which operatives fatigue can influence time study.

Objectives of Work Measurement

Using as a target, the times establish for jobs at the defined level of performance, work
measurement has the following uses:

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● To assist in method study by comparison of times for alternative methods, and

for allocating labour to jobs in proportions to the work involved so that the
labour on a job is properly balanced.
● To enable realistic schedules of work to be prepared by relating reasonably
accurate assessment of human cork to plant capacity.
● As the basis of realistic and fair incentive schemes
● To assist in the organisation of labour by enabling a daily comparison to be
made between the actual times and target times.
● As a basis for labour requirement and budgeting control systems.
● To enable estimates to be prepared for future labour requirements and costs.

Procedure of Work Measurement

● The job is broken down into its elements,
● For the elements of human work, the records of basic times for each element
are consulted,
● For the elements for which there is no basic time already available, the basic
time is determined by the appropriate work,
● The value so determined for any of the elements which could conceivably
recur in another job is added to the records of basic times.
● The provision of rest required is assessed and added to the basic time, to arrive
at the time for doing the work at the standard rate of working and for
recovering from the effort i.e. the work content, ,
● The addition of the relaxation allowance may be done element by element or
the basic times for the element may be summed and the relaxation allowance
added job wise again to the work content.
● The necessary technical data are collected for any machines involved in the
job,
● The values for the human work, the technical data and any other appropriate
allowance are combined to arrive at the standard time for the job.

The assessment of time study involves:

● Synthetical estimating
● Predetermined motion time system
● Activity Sampling
● Rated Activity Sampling

Synthesis: Synthesis of work measurement for building up the time for a job or parts of a
job at a defined level of performance is conducted by adding element times obtained
previously from time studies on other jobs containing the elements concerned, or from
synthetic data. Estimating is a means of assessing the time required to carry out work, based
on similar types of work, without a detailed breakdown of the work into elements and their
corresponding times at a defined level of performance.

Predetermined Motion Time System: The times established for basic human motions are
used to build up the time for the job at a defined level of performance.

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Activity Sampling: In this technique large a number of observations are made over a period
of time of one or group of machines, processes or workers. Each observation records what
is happening at that instant and the percentage of observations recorded for a particular
activity or delay is a measure of the percentage of time during which that activity or delay
occurs. It employs statistical analysis techniques to facilitate predictions about a state of
activity and hence inactivity of the study subject by examining a representative sample of
actions. The main advantage of the use of activity sampling lies in the fact that a larger
number of machines or men can be studied in one situation than in a continuous time study
leading to a broader picture of efficiency of the particular operation.
Rated Activity Sampling: This is an extension of the activity sampling in which rating is
applied so that, where the frequency is known, work content may be established in addition
to the proportion of time occupied by other activities or delays.

Standard Rating
BS 3138 defines standard rating as the rating corresponding to the average rate at which
qualified workers will naturally work at a job, provided they adhere to the specific method
and are motivated to apply themselves to their work. If the standard rating is maintained
and the appropriate relaxation is taken, a worker will achieve standard performance over
the working day or shift. The concept of standard rating is only acquired through
experience in judging different speeds of movements, effort, consistency and dexterity (or
skill) in order to be able to differentiate between fast, slow or medium rates of doing work.
The BS rating scale provides a suitable description for varying levels of worker
performance achieved over a short period of time and is divided into five-point graduations
with 100 representing standard rating. Thus, the rating is assessed using the following:
125: very quick, high skill, highly motivated
100: Brisk, qualified skill, motivated
75: Not fast, average skill, disinterested
50: Very slow; unskilled, unmotivated

Calculation of Basic Time

The basic or normal time for a work task is the time that a qualified worker would use to
carry out a specific job at a defined working level. This is represented mathematically as:

Basic Time = Observed time x assessed rating

Standard rating

Relaxation Allowance
It is an allowance of time made to a worker for personal needs and for recovery from the
fatigue caused by doing his work. It varies from job to job, according to the work type.
Thus, the heavier the work, the higher the energy required to do the work, and the greater
will be his allowance. Below are the fatigue factors:

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Personal Needs-Standard (S): This allowance of 6% covers normal personal needs such
as tea breaks, visits to the lavatory, etc which can be judged common to all jobs.
Conditions-(C): Up to 10% is allowed for the working condition under which the job is
performed. In a well furnished environment little or no allowance is given.
Physical effort (E): Up to 50% should be allowed according to the energy required to do
a job. Normal sedentary work (eg. sitting) would require no allowance, whereas hard
work will require the maximum.
Position (P): Up to 10% should be allowed as follows:

● Walking normally or Standing 1% - 2%

● Sitting or walking with a light load occasionally bending or stretching
3%- 4%
● Walking under heavy load or more 5%-7%
● Working in a restricted or cramped environment 8%-10%

Attention (A): Up to 10 % should be allowed according to requirements. Most normal

jobs take 2%-3%.
Monotony (M): Up to about 8% should be allowed. Most normal jobs require very little in
the construction industry.

Calculation of Standard Time

The standard time for a particular work is obtained by including some relaxation
allowances plus contingency. The units would be standard minutes or standard hours and
it represents the correct time for a worker to execute a task or an elements of work.
Standard time = Basic time + (relaxation allowance + contingency) x Basic Time

Contingencies
A number of minor activities may be infrequent that work measurement cannot be
undertaken economically. In such situations a contingency allowance, expressed as a
percentage of basic times may be included in the work content of the job. Examples of such
activities are: consultation of other labourers, and sharpening of tools.

Performance Level
The standard time for an activity when compared with the actual time spent on the task
indicates the level of performance achieved. That is:

Performance (%) = total standard time for all measured and estimated work x 100
Labour minutes or hours of work time available

Application of Work Study in Construction

After researching into the appropriate method of doing a particular job, it would have to be
introduced to the workers and the entire work environment on the site. The work study
expert thus faces the problem of human resistance to the introduction to new methods.
The main objective is to improve upon the existing way of doing things by effecting
change, regard must be paid to the reactions of the employees of any status whatsoever
who experiences these effects. While the individual's reaction is important, much of the
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fear and even the past have been demonstrated by working groups, organised or otherwise.
Those responsible for introducing the work study do well to remember that the work study
specialist is a person from outside the working group which he studies and may therefore
be regarded – until the appropriate explanations have been made – as a threat to the
equilibrium of the group. From this it follows that, if the effect of work study is to break
up or even rearrange working groups effort must be made to explain the reasons for the
change in order to gain its acceptance.
It is essential that trade unionists are included in the early stages of the work study. In such
consultations there bound to be no hesitation in the discussion of all the problems involved
and the possible repercussions and effects. So long as a tradition of consultation and
explanations is carried out, difficulties should not occur. If they do they should easily be
dealt with the atmosphere of confidence.

EXERCISES

Question 1
An activity sampling in a preliminary survey was conducted at a construction site and
the results indicate that 20% of the time of a gang of workers is spent idly. Estimate the
total number of observations required to determine the proportion of idle time within 5%
accuracy. The critical value at 95% confidence limit is 1.96.
(i) What was the proportion of people not
idle?.........................................
(ii) Calculate the total number of observations......................................

Question 2
1. A work study was conducted at a construction site on concrete work. Aggregates
were loaded manually into a concrete mixing machine. The concrete was poured into
dumper and transported to a hoist and lifted to the 4th floor of multi-storey building.
Materials loading - 2 minutes
Mixing of materials - 2 minutes
Transporting and discharging concrete into hoist bucket - 1 minute
Dumper returns to mixer - 1 minute
Lifting, discharge and return of hoist - 2 minutes
Mixer load (capacity) is - 0.5m3

(i) What is the cycle time of the concrete mixing machine...............................

(ii) What is the cycle time of the Dumper..........................................................
(iii) What is the cycle time of the Hoist..............................................................
(iv) Calculate idle time of hoist in percentage ...................................................
(v) Calculate idle time of dumper in percentage ..................................
(vi) Calculate the concrete production output in an 8-hour working day....
..............................................................................................................

(b) The sequence of elements and cycle of operations in (a) above are displayed on a
multiple activity chart by construction site management. Complete the following
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multiple activity chart by showing the duration using line for each element and
equipment cycle times. The 2 minutes duration of material loading is shown as an
example.

Time (minutes)
Elements/cycle symbol duration 1 2 3 4 5 6 7 8 9 1 1 1 1 1 1
0 1 2 3 4 5
Materials loading

Mixing of materials

Cycle time of mixer

Transport and
discharge of concrete
into hoist bucket
Dumper returns to
mixer
Cycle time of dumper

Lifting, discharge and

return of hoist

Cycle time of hoist

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CHAPTER SEVEN

7.0 CONSTRUCTION PLANNING TECHNIQUES

By the end of this session students should be able to state, explain or describe the
following:

o Preparation of method statement

o Pre-tender and pre-contract planning
o Post tender or contract planning
o Construction Planning Methods (CPM, PERT, Line of balance)
o Work Programming (Construction Schedules using bar charts and
Microsoft Project)

7.1 CONSTRUCTION PLANNING AND METHOD STATEMENT

Method statement is prepared by the contractor to provide the basis for programming of
the works. Content of method statement includes the following:
o Summary of major operations and logical sequence of construction,
o Outline of the construction methods to be used
o Work-force (labour) Requirement
o Material requirement
o Plant requirement
o Overall work programme

Construction planning and programming of works involves determining and organizing

the following:
o Method of construction (method statement)
o Sequence of operation
o Volume of work (for each work item in the BOQ)
o Duration and Resources required for each work item,
o Analysis of network and preparation of programme of works using Gantt Chart
or MS Project,
The programming of works is used for progress monitoring and control of the project.

These are presented in a logical sequence of construction.

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7.2 PRE-TENDER PLANNING

a) Procedure for overall programming
1. Break down the major operations in the overall project into more detailed
operations (element of work), taking care to include all operations. Any
preparatory work necessary must be included.
2. Fill in plant-hours and/or productive man-hours for the detailed operations
3. Decide on the number of operatives and plant necessary and calculate the time
required, plotting each operation on the programme as it is considered. The aim is
to provide continuity of work for men and plant and to meet the target set in the
overall programme.

Pre-Contract Planning
Activities Resource requirements
Breakdown project into major operations only
Eg. Materials, labour, plant and
- set up site equipment,
- sub-structure
- R. C. frame
- Structural blockwork
- Roofing
- Finishing
- External work
- Cleaning up and tidying site

b) Schedules of resources and activities

Labour schedule (labour requirement): This is drawn up on the basis of the overall
programme by adding up the labour required each week. Plant schedule (plant
requirement): This is drawn up from the overall programme and shows major items of
plant required each week. The other schedules are: material requirement schedule, sub
contractors schedules, information requirement schedule, and component schedules. All
these can be drawn up, based on the overall programme.

c) Financial control
A financial graph can be prepared from the overall programme by applying costs to the
operations.

7.3 POST TENDER PLANNING

This involves overall construction planning after award of construction. It involves short
term (monthly) planning on site, weekly planning and daily planning of the construction
works. These are used for progress control to ensure that the project is completed on
schedule.
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Post-Contract Planning (Short term Planning)

Activities Resource requirements
Break down major operations into detailed Materials, labour, plant and
element of work equipment,
Eg. For R.C. frame
- R. in columns
- Formwork to col.
- Concrete to col.
- Formwork to beams and slab
- R. to beams and slab
- Conc. to beams and slab

Short term (monthly) planning on site

Short term programming can cover a period of 4 to 6 weeks or may cover a stage of the
work. The purpose is to ensure that work proceeds in accordance with the overall
programme, which in turn is converted into a working schedule.

Weekly planning
Purpose of weekly programming is to ensure that the six-weekly programme is
effectively carried out. It is used as a basis for operational instructions, for
communicating the plan to the trades foremen, gangers and operatives and to help in co-
coordinating the requirements of different sites.

Daily programming
The work must be planned in detail if it is to be done effectively.

7.4 CONSTRUCTION PLANNING: CRITICAL PATH METHOD

Increasing use of critical path method (CPM) will demonstrate the importance of
time, performance records and cost performance information to the construction
industry. The importance of CPM and the failures of CPM in construction need to be
well understood.

Advantages of CPM
1. It is a logical mathematical model of the project, based upon the optimum
time required for each work process and making the most economical use of
available resources.
2. During executing of the project it permits systematic reviewing of current
situations as they arise, so that
● Allowance can be made for the effects of uncertainties in the original
planning and

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● Remedial measures initiated for those operations that require correction or

acceleration
● As well as enabling a revaluation of future uncertainties to be made
3. It leads to considerable reduction of project times and costs
4. The use of CPM enables the most economical planning of all operations to
meet desirable completion dates. It replaces the judgement based on
experience (or trial- and- error) formerly used to select operation times, crew
sizes, equipment, etc.
5. With CPM one readily determines with certainty the best completion date for
the project
6. Means of communicating plans, schedules, time and cost performance of
project. It provides a means of assessing the effect of all variations – changes
orders, extra work, or deductions – upon the time of completion and upon the
cost of the work.

Definitions of terms in network analysis

Activity (job or task) is the portion of a project which requires time and resources and has
beginning and ending. Eg. Excavation, paper work, plant operations, etc.

Event is the ending and beginning points of activities, at which activity is completed or
another takes place. In project control event is a milestone that represents a major measure
of progress in the project. Event is a point or a milestone at which activity is completed or
another takes place.

.Critical path activities have total float of zero. Any delay will cause the project
completion to be delayed. The sum of all duration on critical path gives the minimum
duration for the project completion.

Total float
It is spare time available, which can be delayed or expended and still not interfere with the
project end date.
.
Free Float
It is the amount of time by which an activity could be extended or delayed without
interfering with the succeeding event.

Interfering float
It is amount of spare time available which if used will affect the subsequent activity.

Network Analysis using Activity-on-the-arrow

Activity-on-Arrow (AOA), (Arrow diagram),

There are five steps for the network analysis. Steps in producing a network are as follows:

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Step 1. List the activities and estimating the duration of activities. The durations and
time analysis is carried out to estimate time required for each activity and this is based on
knowledge of the work, experience, records, and work-study.

Step2: Produce a logical network of activities. Develop a logical network diagram using
arrows to represent all the activities of the project. The arrows are joined together in a
logical relationship. Identify all the activities with numbers for the events e.g. use numbers
with circles around at the ends of the arrow to represents an activity (method of
identification). The following are examples of how to produce a logical network where
activities have correct immediate predecessors and successors.

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Each activity must have a different set of starting and finishing node numbers. This poses
a problem when two activities (A and B) start and finish at the same event node, and means
that the example shown below is incorrect. In order to apply this rule, therefore, an artificial
or ‘dummy’ activity is introduced into the network. This ‘dummy’ has a duration of zero
time and thus does not affect the logic or overall time of the project.

A
Wrong network

B
A

Correct network
Dummy
B

o To avoid the situation where two arrows leave the same event and arrive together
at another event i.e., activities would have the same identification numbers, hence
a dummy is used, introducing extra event to ensure that each activity has a unique
identification.
o Introduce dummy (a simply logical link which do not represent any activity)
where necessary.

A
C
Wrong

B
C
A
Correct
B

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Step 3. Produce a schedule by calculating forward and backward passes.

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o Carry out forward pass calculations, which determine the earliest times that
every activity may start and finish. The maximum EF value is taken to be the
ES value for the subsequent activities when two or more activities meet at the
same end node.
o Carry out backward pass calculations, which determine the latest times that
every activity may start and finish. The minimum EF value is taken to be the
LF value for the immediate predecessors (activities) when two or more
activities start at the same node.
o The Earliest time of Start event (ES) is the earliest possible time the activity
can start
o The Latest time of Finish event (LF) is the latest time the activity can finish
without delaying the completion of the project
o The Latest time of Start event (LS) is the latest time a preceding activity may
finish
o The Earliest time of the Finish event (EF) is the earliest time that a
succeeding activity may start

Earlie Lates Earlie Latest

st t st time
time Time time of
of 0of2 of 5 8 Finish
Start Start Finish event
event event0 45 event (LF)
Use boxes as
shown below to
(ES) (LS)
2 8
(EF) present
calculation
E E results
4 is duration S
L F
L
S F
A – activity
name or ID
Step 4 Calculate total float, free float and interfering float.
o The calculation of “total float”, i.e. the time available to each activity for delay
before other activities become affected,
Total float (TF) = LF – ES – Duration
Total float (TF) = LS – ES -= LF – EF

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o The calculation of “free float”, i.e. the time available to each activity for
delay before other activities become affected
Free float (FF) = minimum ES of succeeding activity – its own EF
(four boxes approach)
Free float (FF) = EF – ES– Duration (two boxes approach)
Interfering float = TF –FF

Calculation of floats 1
1
0
2
3
5
8 3
1
Earliest Latest 5 Earliest Latest
time of Time of time of time of
start start finish finish
event event event event
Total time available
(ES) LS
duration
( ) (EF ) Total float (LF)
duration Free interfering
1 1 2 float float 3
0 8 5 3
Graphical
illustration of
floats
Graphical illustration of floats

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Step 5. Assess resources required for each activity.

Resources can be written alongside each arrow in the network (and in bar chart).
The resource aggregation chart is useful in assessing work content (for
labourers) and for estimates. Float available allows the distribution of peaks of
resource demand. There are two approaches to assessing resources required:
o There is time limit for the project. The project has to be completed
within the minimum time possible for completing the project, so make
use of available floats.
o There is also resource limited problem (resource-limited resource
considerations). The project must be completed with the limited
resources,

The following example illustrates the calculations involved in network analysis.

Worked Example: Critical Path Analysis

Activities, predecessors and duration for the Project are shown below. What is the critical
path of the above project? Calculate the total and free floats for the activities.

Activity Description Immediate Duration

predecessor (days)
A Clear Site and mobilize resources None 10
B Procure materials (cement, chippings etc.) None 10
C Excavate trench A 23
D Pour base concrete C,G 12
E Stone pitching C,G,H 14
F C,G,H 30
H B 17
I A 13
K J,D,E 9
L I 1
M L 8
G B 15

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J I 12

Solution
The critial path is 1-2-4-5-9. The delay of any of the critical activities will delay the
project completion date.
ES EF 10 23
23 24
LS LF 13 29 42
54 55
2 0000 6
I 0000 8
1 L
0 10 10 8
23 J 12 23 35 24 32
0 10 C M
42 54 55 63
A 10 33 33 45 0000 47 56
10 33 0 0
42 54 12 54 63
1 9
4 0000 7 0000 9
D
B 10 25 33 47 K
18 33 40 54
10
33 33 F
0 10 G E 14 33 63
15 33 33
6 16 30 33 63
H 10
3
5
17 10 27
16 33
Calculation of floats 10

Item Arro t ES LS EF LF TF FF IF Critical

w
A 1-2 1 0 0 10 10 0 0 0 C
0
B 1-3 1 0 6 10 16 6 0 6
0
C 2-4 2 10 10 33 33 0 0 0 C
3
I 2-6 1 10 29 23 42 19 0 19
3
G 3-4 1 10 18 25 33 8 8 0
5
H 3-5 1 10 16 27 33 6 0 0
7
Dum 4-5 33 033 33 33 0 0 0 C
my
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D 4-7 1 33 42 45 54 9 2 7
2
E 5-7 1 33 40 47 54 7 0 7
4
F 5-9 3 33 33 63 63 0 0 0 C
0
J 6-7 1 23 42 35 54 19 12 7
2
L 6-8 1 23 54 24 55 31 0 31
K 7-9 9 47 54 56 63 7 7 0
M 8-9 8 24 55 32 63 31 31 0

Scheduling of Activities
Activi Working Days
ty
Item Arro Critica 0 10 20 30 40 50 60
w l
A 1-2 Critica
l
B
C Critica
l
D
E
F Critica
l
G
H
I
J
K
L
M 8-9

Scheduled Duration free float Interferring float

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7.4 PROGRAMME EVALUATION AND REVIEW TECHNIQUE (PERT)

PERT is used to assess the risk associated with high-stake project especially military
intervention projects where completion dates need to be met. PERT is used for project
evaluation and it involves stochastic network analysis. It is used to predict duration of
projects. It is rarely used in the planning of a normal construction projects.

In CPM single time is estimated for each activity, but in PERT three times are estimated
for each activity. These times are the optimistic, pessimistic and the most likely durations
for the activity. These three time estimates are used to determine the mean and variance for
a beta distribution of the activity times. The mean duration of an activity in a PERT network
is given by:

Te = (a+4m+b)
6
Where,
a is the optimistic duration
b is the pessimistic duration
m is the most likely duration

The standard deviations (s) of the individual activities are calculated using the following
equation.
s = (b-a)
6
The expected project duration is obtained from forward and backward passes analysis. But
it is possible to compute the variance for the project completion time. To determine the
project variance, the sum of the variances for those activities on the critical path is
calculated. Project variance of critical path is calculated as follows:

The project variance = (s12 + s22 + s32 + s42 +……sn2)

The project standard deviation = (s12 + s22 + s32 + s42 +……sn2)1/2

In CPM/PERT method assumes that the activity times are statistically independent, which
allows us to sum the individual expected activity times and variances to get an expected
project time and variance. Given this assumption, the expected project duration and the
variance are interpreted as the mean completion time (µ) and variance of a normal
distribution.

Worked Example
The network below shows the optimistic, most likely, pessimistic durations (a, m, b). What
is the critical path of the above project? Calculate the total and free floats for the activities.
What is the project duration? Calculate the probability that the programme will be
completed in 33 weeks or less.

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6-8-10 2-3-6
2 4 9

1-4-6
6-9-15

1 2-3-5
6 10 11
1-2-4

2-4-8
4-7-9
2-4-5

3 4-7-12 5-9-11 5-9-11

5 7 8

Solution

Activity EstimatedDuration
Estimated Duration (weeks) Mean
Mean SD
duration
i J a m b Te s
1 2 6 9 15 9.5 1.50
1 3 2 4 8 4.3 1.00
2 4 6 8 10 8.0 0.67
3 5 4 7 12 7.3 1.33
4 9 2 3 6 3.3 0.67
5 6 4 7 9 6.8 0.83
5 7 5 9 11 8.7 1.00
6 8 1 2 4 2.2 0.50
7 8 5 9 11 3.2 0.50
8 10 2 4 5 3.8 0.50
9 10 1 4 6 3.8 0.83
10 11 2 3 5 3.2 0.50

Use Te = (a+4m+b) and s = (b-a) to calculate the mean duration and the SDs.
6 6

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8.0 3.3
2 4 9
3.8
9.5 30.5

30.5

1 3.2
6 10 11
2.2

4.3
6.8
3.8
3 7.3 8.7 3.2
5 7 8

Calculation of Probability of meeting scheduled project durations

The mean duration (µ) of the project is 30.5 weeks (ie project end date/project duration),
and the event scheduled time (Ts) for completion is 33 weeks or less.
The Critical Path is 1-3-5-7-8-10-11
The standard deviations (SD) of the individual activities are used to calculate the SD of the
critical path. Standard deviation (SD) of critical path is calculated as follows:

SD: 1 1.33 1 0.50 0.5 0.5

Project standard deviation,  = (12 + 1.332 + 12 + 0.52 + 0.52 + 0.52)1/2 = 2.13

Ts µ
30.5 33 Time
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P (x  33)

P (X  33) = Z = (Ts - Tx )

µ – expected mean time for an event
Ts – event scheduled time
 – standard deviation

33 − 
P (Z <  )
but  = 2.13 (ie standard deviation of critical path)
µ = 30.5 (ie project end date/project duration)

P(Z < 1.173) = Φ (1.173) Read from probability table and add 0.5.

7.5 PROJECT CRASHING AND TIME-COST TRADE OFF

To this point we have demonstrated the use of CPM and PERT network analysis for
determining project time schedules. This in itself is valuable to the manager planning a
project. However, in addition to scheduling projects, the project manager is frequently
confronted with the problem of having to reduce the scheduled completion time of a project
to meet a deadline. In other words, the manager must finish the project sooner than
indicated by the CPM or PERT network analysis.

Project duration can be reduced by assigning more labour to project activities, often in the
form of overtime, and by assigning more resources (material, equipment, etc.). However,
additional labour and resources cost money and hence increase the overall project cost.
Thus, the decision to reduce the project duration must be based on an analysis of the trade-
off between time and cost. Project crashing is a method for shortening the project duration
by reducing the time of one or more of the critical project activities to a time that is less
than the normal activity time. This reduction in the normal activity times is referred to as
crashing. Crashing is achieved by devoting more resources, measured in terms of dollars,
to the activities to be crashed.

To demonstrate how project crashing works, we will employ the network for constructing
a house (Figure below). Although this example network encompasses only single-activity
time estimates as in CPM, the project crashing procedure can be applied in the same manner
to PERT networks with probabilistic activity time estimates.

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In this Figure, we will assume that the times (in weeks) shown on the network activities
are the normal activity times. For example, normally 12 weeks are required to complete
activity 1–2. Furthermore, we will assume that the cost required to complete this activity
in the time indicated is $3,000. This cost is referred to as the normal activity cost. Next, we
will assume that the building contractor has estimated that activity 1–2 can be completed
in seven weeks, but it will cost $5,000 to complete the activity instead of $3,000. This new
estimated activity time is known as the crash time, and the revised cost is referred to as the
crash cost. Activity 1–2 can be crashed at a total of five weeks (normal time - crash time =
12 – 7 = 5 weeks) at a total crash cost of $2,000 (crash cost - normal cost = $5,000–3,000
= $2,000). Dividing the total crash cost by the total allowable crash time yields the crash
cost per week.

If we assume that the relationship between crash cost and crash time is linear, then activity
1–2 can be crashed by any amount of time (not exceeding the maximum allowable crash
time) at a rate of $400 per week. For example, if the contractor decided to crash activity 1–
2 by only 2 weeks (for an activity time of 10 weeks), the crash cost would be $800 ($400
per week x 2 weeks). The linear relationships between crash cost and crash time and
between normal cost and normal time are illustrated in Figure below.

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The normal times and costs, the crash times and costs are shown in the Table below.

normal crash Allowabl Activity

Activity Node No time cost crash cras e crash Crash Cost
de Time h time per week
cost
Design 1 2 12 3000 7 5000 5 400
Substructure 2 3 8 2000 5 3500 3 500
order materials 2 4 4 4000 3 7000 1 3000
Dummy 3 4 0 0 0 0 0 0
Fabrication of Truss 4 5 4 500 1 1100 3 200
super structure 4 6 12 5000 9 7100 3 7000
0 0
Erect truss 5 6 4 500 1 1100 3 200
External work 6 7 4 1500 3 2200 1 7000
0 0

Project crashing with linear programming

The linear programming model required to perform project crashing analysis differs from
the linear programming model formulated for the general CPM/PERT network. The linear
programming model for project crashing is somewhat longer and more complex.
The objective for CPM general linear programming model was to minimize project
duration, but the objective of project crashing is to minimize the cost of crashing given the
limits on how much individual activities can be crashed. As a result, the general linear
programming model formulation must be expanded to include crash times and cost. We
will continue to define the earliest event times for activity i–j as xi, and xj. In addition, we
will define the amount of time each activity i–j is crashed as yij. Thus, the decision variables
are defined as:
xi, = earliest event time of node i
xj = earliest event time of node j
yij = amount of time by which activity i–j is crashed (i.e., reduced)

The objective of the project crashing model is to minimize the cost of crashing. The
objective of project crashing is to reduce the project duration at the minimum possible crash
cost. For our house-building network, the objective function is written as

minimize Z = $400y12 + 500y23 + 3,000y24 + 200y45 + 7,000y46 + 200y56 + 7,000y67

The objective function coefficients are the activity crash costs per week from above Table.
The variables yij indicate the number of weeks each activity will be reduced. For example,
if activity 1–2 is crashed by 2 weeks, then y12 = 2 and a cost of $800 is incurred.
The model constraints must specify the limits on the amount of time each activity can be
crashed. Using the allowable crash times for each activity from above Table enables us to
develop the following set of constraints.
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y12 ≤ 5
y23 ≤ 3
y24 ≤ 1
y34 ≤ 0
y45 ≤ 3
y46 ≤ 3
y56 ≤ 3
y67 ≤ 1

For example, the first constraint, y12 ≤ 5, specifies that the amount of time that activity 1-
2 is reduced cannot exceed five weeks. The next group of constraints must mathematically
represent the relationship between earliest event times for each activity in the network, as
the constraint xj – xi ≥ tij. However, we must now reflect the fact that activity times can be
crashed by an amount yjj. The activity 1-2 constraint is formulated as: x2 – x1 ≥ 12, this
constraint can also be written as x2 +12 ≤ x2
This latter constraint indicates that the earliest event time at node 1 (x1) plus the normal
activity time (12 weeks) cannot exceed the earliest event time at node 2 (x2). To reflect the
fact that this activity can be crashed, it is necessary only to subtract the amount by which
it can be crashed from the left-hand side of the preceding constraint.
xl + 12 - y12 ≤ x2 , where y12 is amount activity 1-2 can be crashed
This revised constraint now indicates that the earliest event time at node 2 (x2) is
determined not only by the earliest event time at node 1 plus the activity time, but also by
the amount the activity is crashed. Each activity in the network must have a similar
constraint, as follows.
xl + 12 - y12 ≤ x2
x2 + 8 - y23 ≤ x3
x2 + 4 - y24 ≤ x4
x3 + 0 - y34 ≤ x4
x4 + 4 - y4s ≤ x5
x4 + 12 - y46 ≤ x6
x5 + 4 - y56 ≤ x6
x6 + 4 - y67 ≤ x7
Finally, we must indicate the project duration we are seeking (i.e., the crashed project time).
Because the housing contractor wants to crash the project from the 36-week normal critical
path time to 30 weeks, our final model constraint specifies that the earliest event time at
node 7 should not exceed 30 weeks: x7 ≤ 30
The complete linear programming model formulation is summarized as follows.
minimize Z = $400y12 + 500y23 + 3000y24 + 200y45 + 7000y46 + 200y56 + 7000y67
subject to
y12 ≤ 5
y23 ≤ 3
y24 ≤ 1
y34 ≤ 0
y45 ≤ 3
y46 ≤ 3
y56 ≤ 3
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y67 ≤ 1
yl2 + x2 - xl ≤ 12
y23 + x3 - x2 ≤ 8
y24 + x4 - x2 ≤ 4
y34 + x4 - x3 ≤ 0
y45 + x5 - x4 ≤ 4
y46 + x6 - x4 ≤ 12
ys6 + x6 - x5 ≤ 4
x67 + x7 - x6 ≤ 4
x7 ≤ 30
xi,yij ≤ 0
Because we have been able to develop a linear programming model for project crashing,
we can also solve this model using Excel.

7.6 LINE OF BALANCE

Definition of Line of Balance
It is a planning technique for repetitive work. The basis of the technique is to fine the
required resources for each stage or operation so that the following stages are not interfered
with and the target output can be achieved.

Advantage
1. It gives a better indication of the dependence of one activity on another
2. It is very useful when progressing, because it is immediately obvious when
corrective action needs to be taken

Preparing a line of balance schedule

2. Prepare a logic diagram,
3. Estimate the man hours required to complete each operation
4. Choose buffers times which will guard against the risk of interference
between operations,
5. Calculate the required output target in order to meet a given project
completion date,
6. Complete the table
7. Draw the schedule, from the information calculated in table
8. Examine the schedule and asses possible alternatives to bring about a more
"balanced" schedule which might include:
i) Changing the rate of output of one activity by reducing (or increasing)
the gang size part way through the project;
eg. An operation can have one gang of men for a number of units and a
gang of 2 thereafter,
ii) Lay off and recall one gang,
Eg. Operation can be suspended for a number of days or weeks after
completing a number of units.
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iii) Overlap some activities ie. Have a non –sequential logic diagram,
which means that the schedules shows sloping lines on the diagrams
which are superimposed, but such schedules become difficult to read
and this severely reduces the effectiveness as a means of
communication with operational staff such as foremen and gangers
iv) Or schedule every activity to work at the same rate. This is known as
"parallel scheduling" and involves employing enough resources to
ensure that the rate of output required can be achieved.

Worked Example

There are 120 pylons to be constructed. The handover rate specified is 6 pylons per week
(target rate of build).

Operation man-hours optimum number of men

(Men in on team)
A Excavate 55 4
B concrete foundation 64 4
C Erect tower 145 8
D Fix cantilever cable arms 90 8
E Fix insulators 25 5

a) Prepare a line of balance schedule assuming that each gang works at its natural
rate.
b) State clearly the contract duration. Assume 5-day working week, 8hours per day,
and a minimum buffer time of two days.

Solution
R = 6 pylons per week
120 pylons to be constructed
Activit Men Men Theoretica Actual Actual Time Time in Buffer
y hours per l gang size gang rate of in days days from time
per activity size output for start of
activity each first unit to
activity start of last
unit
1 2 3 4 5 6 7 8 9
A 55 4 8.3 8 5.8 1.7 102.3 2
B 64 4 9.6 12 7.5 2.0 79.3 2
C 145 8 21.8 24 6.6 2.3 89.9 2
D 90 8 13.5 16 7.1 1.4 83.7 2
E 25 5 3.75 5 8 0.6 74.4 2

Theoretical gang size which is the men required per week for each activity to produce 6
pylons per week is obtained by multiplying the R by the men per week.

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Theoretical gang size = men per week  R

men hours per activity
Theoretical gang size = R
working hours per week

The ratio of men hours per working hours per week gives the number of men to complete
one activity in a week. By multiplying this ratio with R gives the number of men to
complete the activity to meet the target R. Actual gang size is a multiple of men per activity
(could be little above or below theoretical gang size). The actual gang size is used to re-
calculate the new value of R called the actual rate of output.
Actual gang size  R
Actual rate of output =
Thoerotical gang size
Where R is the rate of output or target rate of build (6 pylons per week)

men hours per activity

Time in days for each activity =
men per activity  [Link] hours in working day
Where men per activity is the number of men in one team,

(N - 1)  5 days in a week
Time in days from start of first unit to last unit =
Actual rate of output
N is the total number of facilities to be built, and it 120 is this example.

Draw the line of balance schedule as shown below and indicate the start and end
time for each activity
Rate of Built
120

60

1
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A B C D E

Duration
EXERCISES

Q1
A construction site operation involves excavation of 15000m3 and the excavator output is
25m3 per hour. Assume 6 working days and 8 hours a day.
i. How long would it take in terms of weeks to complete the
operation?.............................
ii. What would be the duration in weeks if a second excavator with output of 50m3
per hour is engaged together with the first excavator from start to
finish?.....................................

Q2 An excavator with an output of 36 m3 per hour is to be used to excavate cut section

of a road construction project. The excavated material is to be disposed of by trucks, each
with capacity of 3m3 and 20 minutes cycle time. Calculate the following:

i. The number of truck loads per hour………………………………………………...

ii. The loading time (in
minutes)………………………………………………………..
[Link] number of trucks required for one-hour
cycle………………………………….

[Hint: A truck cycle time is the time taken to load the truck, to travel to tip, off-load and
return to loading point]

Q3 Critical Path Analysis for a School Project

Activities, predecessors and duration for a School Project

Activity Description Immediate Duration

predecessor (days)
A Clear Site and mobilize labour and equipment None 5
B Excavate foundation A 15
C Procure materials (sand, cement, chippings etc.) A 10
D Pour foundation concrete B, C 5
E Mould sandcrete blocks (substructure) C 5
F Construct substructure block work D, E 15
G Construct superstructure block work F, H 30
H Make doors and window frames I 10
I Procure and preserve roof timber C 10
J Roofing, plastering and painting G, I 25
K Fabricate roof trusses I 15
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L Mould sandcrete blocks (superstructure) C 10

Draw the network diagram.
What is the critical path of the above project?
Calculate the total and free floats for the activities.

Q4 A construction project has the following PERT activity time estimates in weeks.

(i) Calculate the activities durations and variance and fill the table below.

Time estimate (weeks) Duration Variance

Activity a m b
1-2 5 8 17
1-3 7 10 13
2-3 3 5 7
2-4 1 3 5
3-4 4 6 8
3-5 3 3 3
4-5 3 4 5

(ii) The network below shows the activities and their predecessors. Calculate earliest
time of start (ES) and finish (EF), and the latest time of start (LS) and finish (LF)
for each activity and fill in the boxes for each activity. Fill in the earliest and latest
times for each activity in the network in the boxes provided as shown below:
ES EF
LS LF

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1
5

(iii) Calculate the total for the following activities and fill the table.

Activity total float

1-2
1-3
2-3
2-4
3-4
3-5
4-5

(iv) Write down the critical path of the above project.

(v) What is the expected project completion time and variance?
Expected project completion time………………………………………………..
Expected project variance…………………………….………………………..
(vi) What is the probability that the project will be completed in 28 weeks or less?

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CHAPTER EIGHT

8.0 CONSTRUCTION CONTROL

8.1 CONCEPT OF CONTROL

Control involves comparing actual performance with a pre-determined plan or target and
taking the necessary corrective actions to keep the plan on schedules should any deviations
from planned progress occur.

The control process is aimed at early discovery of any deviations or departure from planned
progress, so that plans or schedules can to be revised (Figure 1). This aim is achieved
through:
o Regular monitoring of progress or achievement
o Comparison of achievement against planned progress
o Taking corrective actions
Control is a continuous process throughout the project construction period (Figure 2).
Figure 1 Monitoring Progress

% Completion Planned Progress

Actual achievement

ACTION REQUIRED

Time
Figure 2 Control Cycle
Collect progress reports
and data for monitoring
progress

Take corrective actions Conduct Progress

and revise schedule Analysis

Determine project status

and delays
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Site management control

The principles and techniques of site management for those who do have direct control of
resources would justify a separate volume. However, a brief description of what is involved
is given below under the heading “Site control”. The principal participants at the
constructing stage are the project manager and the contractor. On a large contract, the
contractor may appoint a supervisor whom he may also call the Site manager or project
manager, so there is often confusion regarding the roles of these two main participants.
The "project manager" used in this teaching material refers to the client's representative
with overall responsibility for managing all stages of the project. "Contractor" refers to
the person responsible for the construction works only. However, it is important that the
project manager should understand the way in which a contractor manages a project.

Control Parameters: Time, Cost and Quality

There are three elements to be controlled in a construction project. These are:

o Progress (Time) against Schedule

o Cost against tender or budget,
o Quality against specification

8.2 PROGRESS AND TIME CONTROL

The project manager should have prepared a time – schedule for the whole project during
the briefing stage. Although lacking in detail, this will provide basic control information,
such as the planned completion dates for each stage. As the project progress, information
will become available from which a more detailed plan can be prepared. Thus, by the end
of the briefing stage it should be possible to prepare a detailed work plan for the designing
stage, showing not only when activities are to be completed but also the resources required.

Similarly it should be possible to prepare a more detailed schedule for the construction
stage well before completion of the designing stage. The schedule is shown in a bar chart,
for large and complex projects it may be necessary to use network analysis. The required
completion times for the construction stage should be written in the contract document
since they may have an important bearing on the tender price.

During the construction stage it is the contractor’s responsibility to prepare a detailed work
plan, which meets the requirements of the contract. The project manager should assess the
realism of the contractor’s schedules, especially as regards availability of resources. It is
the responsibility of the main contractor to coordinate the work of his subcontractors; but
there may be suppliers, or indeed other main contractors, whose activities the project
manager must coordinate.
It sometimes not clearly understood that the project manager does not usually have direct
authority over the resources of men, materials and equipment needed to build the project.
For example, if a brick wall is being built too slowly because the contractor has not
employed enough bricklayers, the project manager cannot give instructions for the
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employment of more bricklayers. What he can and should do is point out the consequences
of this slow building on the project as a whole. The principles and techniques of site
management for those who do have direct control of resources are discussed in other
chapters and under “site control”. The tools for progress control are the bar charts or critical
path networks described in Chapter five. Whichever technique is used, the project manager
should take the following steps:
● Establish “targets” or “milestones” – times by which identifiable complete sections
of work must be completed. One such target would be the completion of sketch
plans during the designing stage, or the completion of all work to render a building
watertight so that equipment may be safely installed.
● As each target event occurs, compare actual against targeted performance. For
example, were the sketch plans completed on the date planned, or two weeks
before, or one month after?
● Assess the effect of performance to date on future progress; and project - end date.
● If necessary, re-plan so as to achieve original targets or to come as near as possible
to achieving them;
● Request appropriate action for those directly responsible for the various activities.

Planning and control techniques achieve nothing unless they are translated into action, and
it is the responsibility of the project manager to see that this happens for effective time
control.

The following Table is an example of progress report for a construction project in Ghana.
The percentages of previous and current work done for each work item are presented each
month. The priced Bill of Quantities is added as an annex to the progress report.

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8.3 COST CONTROL

The project budget
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The aim of cost control of a construction project should be the active control of the final
cost to the client, not merely the passive registration of payments. The tool used for control
is the project budget, and the principles shown in the figure below.

PROJECT
BUDGET

Estimated cost Special

Unforeseen cost reserve
fund

A carefully prepared budget is vital for the effective control of project costs. It is also
essential that it should be consistent with the aims of the project, and the required functions
and quality standards. A decision on the project, investments cost should be taken only
after the preparation of a reliable cost estimate. The project budget should be prepared
according to an accounting plan. The choice of accounts and the level of detail will depend
upon the client’s information needs and the control requirements. The budget should cover
the complete project costs, including cost for the briefing and designing stages and general
cost such as service connection charges. The accounting plan serves as a check. The budget
for each account is based on the estimated cost, with an addition for contingencies. The
sum of individual budget accounts gives a total which is exclusive of price escalation and
contingencies.

To deal with general contingencies, a reserve fund may be budgeted for at the discretion of
the client. This fund would cover such things as changes in the conditions upon which the
budget was based, and would be used be used only with the client’ specific approval.
The way in which cost estimates are built up is now described.

Cost estimates
Several estimates of “cost” are prepared during the stages of a project. Care must be taken
to distinguish between an estimate of “cost” and a “price”: for example a contractor may
prepare an estimate of the cost to him of a project, but the tender price he submits will be
his assessment of the highest figure that will secure him the contract. His price will then be
the clients cost. The reliability of any information depends on the information which is
actually available at the stage when the estimate is prepared. Three categories of
information are necessary:
Information about the project and its components. In the briefing stage information is
normally restricted to rough estimates. Only when the sketch plans have been prepared is
it possible to estimate cost with any degree of accuracy. A full knowledge of the quantities

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involved is available only when the working drawings have been finalised. Prior to this,
however, it is possible to compile approximate “bills of quantities”.
Information about resources. Only when the contractor starts planning site operations is
information available about the manpower and other resources:
Information about prices. The contractor normally has a good knowledge of the actual
prevailing prices for different materials and other resources. It is often more difficult for
the designers to obtain reliable prices information for the estimates prepared during the
designing stage. Prices in “bills of quantities” from the briefing stage, the price information
is normally limited to such data as cost per unit floor area, or unit length of road, as
established for previously completed projects. The choice of estimating method depends
on the quality of the available information. An estimate of total construction costs proceeds
through four main stages
Preliminary estimates used in the briefing stage and based on cost records of broadly
similar projects.
Detailed estimates, prepared by the project management team prior to tender, based on
accurate quantities measured from working drawings and prices from previous project
documents
Contract sums, which may be a very good guide to the clients cost in the case of a fixed
price contract but less so in other circumstances.
Operational estimates, usually prepared by the contractor, based on the planning of site
operations.

A cost estimates can never be more accurate than the information it is based on. Only an
“operational estimate” or a fixed price contact sum can provide a really accurate cost
estimate. The accuracy of earlier estimates is inevitably lower, with those at the briefing
stage the least reliable. However, if one starts to produce estimates of final cost at this very
early stage, their accuracy can be progressively improved. The forecast of the likely level
of contractor’s tenders will also require an assessment of the keenness of the competition,
which will in turn vary with general economic conditions. When submitting an estimate to
the client at any stage, the project management team should always add a not on the
probable degree of accuracy that has been achieved.

Control Curves and Cash Flow

The continuous curves (S-curve) shown below can of course be drawn only if it is possible
to estimate the value of work done in detail. This implies a contract based on a bill of
quantities. Where the contract payments are based on some other method, the project
manager’s ability to obtain a single and reasonably objective measure of overall progress
is diminished.

Maintenance Period
/defect liability
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Cumulative Retention
cost and
Measured
value
value of
work

Contractor pays suppliers

Cash received from client

Application to client

100%
Figure S-curve

It is important to note that the S curves described above relate to the value of work done
and cash payments. The common system is that contractors are paid periodically, usually
monthly, in a way related to the value of the work completed. The contractor submits an
application for payment on a particular date each month. This is then checked and the
project manager approves an amount which the client has to pay within a specified period.
Thus the client’s cash flow may be derived from the value S curve.

8.4 QUALITY CONTROL

Quality control in a construction project should aim at satisfying the client’s stated needs
and requirements. Quality control must be exercised during all stages of a project. During
the briefing and designing stages, a step-by-step decision-making process, incorporating
“control” at which developing design is formally reviewed makes the necessary overall
control easier. Quality control during the construction stage is usually exercised on site by
a clerk of works. Resident Engineer is responsible for seeing that the daily activities of the
contractor result in an end product which satisfies the contract specifications. For example,
he/she will ensure that the materials used for making concrete are up to standard and that
they are mixed in the correct proportion. And that the tests are made on samples of the
missed concrete. It may also be necessary for designers and specialists to carry out site
inspections and checks. It is often useful to establish a control plan, showing when, where
and by whom checks are needed.

The project manager

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The project manager can control site operations only within the conditions of the contract.
In the "standard approach", this means that he should record progress and notify the
contractor if he is behind schedule. He/she can also, through the clerk of works, control
quality against the specification. His control over the client's cost is limited to ensuring that
variations from the contract drawings and specifications are minimized and that valuations
are correct. Where a variation is unavoidable, it should be formally ordered on a standard
form. The principles for pricing the variation order should always be agreed with the
contractor before hand. A fixed price is preferable.

Despite the apparent restriction on his authority, the project manager can exert a
considerable influence on site operations. Even on small projects there are many activities
carried out by agencies and persons other than the main contractor. These activities should
be included in the projects manager's overall work plan, and he should co-ordinate them.
He may also need to give technical advice to the contractor regarding the way in which the
work should be carried out. This may be especially important on a small project where the
contractor is inexperienced.

An important but often neglected aspect of site operations is that of safety. It is the prime
responsibility of the contractor and other organisations working on site to ensure the safety
of their employees. However, the project manager should see that the various regulations
are being observed, and he should encourage the contractor to take common-sense safety
measures such as keeping the site tidy. The next chapter describes safety in more detail.
The main site responsibilities of the projects manager are as follows:
❑ Ensuring the overall co-ordination of contractors, suppliers and other
organisations working on site.
❑ Obtaining the necessary statutory permissions. These may include site entry,
building permits, work permits, notifications to safety inspectors, and so on.
❑ Arranging for services such as water, electricity and gas
❑ Ensuring compliance with safety and fire regulations
❑ Monitoring progress and quality
❑ Checking periodic valuations and facilitating payments to the contractor

These controls cannot be effectively exercised in an office remote from the site. On a large
contract the project manager and his team must therefore be located on site. On smaller
projects where the project manager may have a number of sites to look after, his site visits
should be frequent and long enough to enable him to grasp fully what is going on.

Site Management and Control by the Contractor

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The word "contractor" is used to denote the organisation, which actually execute the works.
The principles of site control described here apply equally to parastatal contracting
organisations, private contractors and direct labour forces, but the word contractor is
applied to them all. The contractor directly controls the construction works. He assembles
and organises the necessary resources of labour, materials and plant and equipment.
Implicit in the supply of these is the need for a fourth resource: money.
The principles used by the contractor in managing these resources are exactly the same as
those used by the project manager.

1. Gather facts

4. Take corrective 2. Analyse

action the facts

3. Predict the
likely outcome

Labour
The tender prepared by the contractor should have been based on his estimate of the work-
hours of labour required to execute the project. Usually this estimate is built up from
estimates of the required numbers of carpenters, masons, labourers and so on. If he is to
make a profit, the contractor must ensure that the productivity of his tradesmen and
labourers is high enough to enable the work to be completed within the estimated work-
hours. This can only be done by measuring the work-hours for each activity or group of
activities and comparing them with the estimated amount. If they exceed the allowance,
the contractor must investigate the causes and take corrective action. If they are fewer, he
must still check that the cost of these hours is not more than his estimate.

Materials
In the same way as the contractor estimates the cost of labour needed for the works, so he
estimates the cost of materials. An important difference is that apart from authorised
variations, the quantity of materials is fixed. It is still essential for the contractor to control
closely his material usage, as sites are very vulnerable to losses through wastage, theft or
(in the case of such items as cement) deterioration.

Plant and equipment

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These include items temporarily needed during construction, such as trucks, concrete
mixers, hoists, ladders, buckets and shovels. The provision of these is the responsibility of
the contractor and is included in his tender price. His responsibility does not include
permanent building installations such as air-conditioning units, lifts, heating and
ventilation units or generators. The same principles of measuring cost against estimate
apply to plant management.

Money
From the contractor's point of view, money is the most important resource of all. Without
it he cannot acquire the other three resources he needs. That many contractors
underestimate their need for this resource. What follows is not about profit, but about the
working capital necessary to run a contract. Even before building operations start, money
is needed for –
❑ Hire of supervisory and administrative staff;
❑ Statutory fees, such as building permits;
❑ Service connection;
❑ Materials;
❑ Hire of transport.

Many contractors underestimate their need for working capital. The fact that a certain value
of work has been completed by a certain date does not necessarily mean that payment will
be made soon after. The contractor must have enough capital to continue paying wages,
purchasing materials and hiring plant during that gap between a valuation of the work and
actual payment. The need for working capital places a particularly heavy burden on small
contractors, and so the project manager should do all he can to facilitate interim payments.

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